[Senate Hearing 111-534]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 111-534
 
    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2010

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

                                HEARINGS

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                                   ON

                           H.R. 3183/S. 1436

 AN ACT MAKING APPROPRIATIONS FOR ENERGY AND WATER DEVELOPMENT FOR THE 
     FISCAL YEAR ENDING SEPTEMBER 30, 2010, AND FOR OTHER PURPOSES

                               __________

                      Department of Defense--Civil
                          Department of Energy
                       Department of the Interior
                       Nondepartmental Witnesses

                               __________

         Printed for the use of the Committee on Appropriations


  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html

                               __________


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                      COMMITTEE ON APPROPRIATIONS

                   DANIEL K. INOUYE, Hawaii, Chairman
ROBERT C. BYRD, West Virginia        THAD COCHRAN, Mississippi
PATRICK J. LEAHY, Vermont            CHRISTOPHER S. BOND, Missouri
TOM HARKIN, Iowa                     MITCH McCONNELL, Kentucky
BARBARA A. MIKULSKI, Maryland        RICHARD C. SHELBY, Alabama
HERB KOHL, Wisconsin                 JUDD GREGG, New Hampshire
PATTY MURRAY, Washington             ROBERT F. BENNETT, Utah
BYRON L. DORGAN, North Dakota        KAY BAILEY HUTCHISON, Texas
DIANNE FEINSTEIN, California         SAM BROWNBACK, Kansas
RICHARD J. DURBIN, Illinois          LAMAR ALEXANDER, Tennessee
TIM JOHNSON, South Dakota            SUSAN COLLINS, Maine
MARY L. LANDRIEU, Louisiana          GEORGE V. VOINOVICH, Ohio
JACK REED, Rhode Island              LISA MURKOWSKI, Alaska
FRANK R. LAUTENBERG, New Jersey
BEN NELSON, Nebraska
MARK PRYOR, Arkansas
JON TESTER, Montana
ARLEN SPECTER, Pennsylvania

                    Charles J. Houy, Staff Director
                  Bruce Evans, Minority Staff Director
                                 ------                                

              Subcommittee on Energy and Water Development

                BYRON L. DORGAN, North Dakota, Chairman
ROBERT C. BYRD, West Virginia        ROBERT F. BENNETT, Utah
PATTY MURRAY, Washington             THAD COCHRAN, Mississippi
DIANNE FEINSTEIN, California         MITCH McCONNELL, Kentucky
TIM JOHNSON, South Dakota            CHRISTOPHER S. BOND, Missouri
MARY L. LANDRIEU, Louisiana          KAY BAILEY HUTCHISON, Texas
JACK REED, Rhode Island              RICHARD C. SHELBY, Alabama
FRANK R. LAUTENBERG, New Jersey      LAMAR ALEXANDER, Tennessee
TOM HARKIN, Iowa                     GEORGE V. VOINOVICH, Ohio
JON TESTER, Montana
DANIEL K. INOUYE, Hawaii, (ex 
    officio)

                           Professional Staff

                               Doug Clapp
                             Roger Cockrell
                         Franz Wuerfmannsdobler
                        Scott O'Malia (Minority)
                         Brad Fuller (Minority)

                         Administrative Support

                            Molly Barackman


                            C O N T E N T S

                              ----------                              

                         Tuesday, May 19, 2009

                                                                   Page

Department of Energy.............................................     1

                         Tuesday, June 2, 2009

Deparment of Energy: National Nuclear Security Administration....    51

                        Thursday, June 18, 2009

Department of Defense--Civil: Department of the Army: Corps of 
  Engineers--Civil...............................................    91
Department of the Interior: Bureau of Reclamation................   106

                       Nondepartmental Witnesses

Department of Defense--Civil: Department of the Army: Corps of 
  Engineers--Civil...............................................   157
Department of the Interior: Bureau of Reclamation................   181
Department of Energy.............................................   201


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2010

                              ----------                              


                         TUESDAY, MAY 19, 2009

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:22 a.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Byron L. Dorgan (chairman) 
presiding.
    Present: Senators Dorgan, Murray, Feinstein, Reed, Tester, 
Bennett, Cochran, and Alexander.

                          DEPARTMENT OF ENERGY

STATEMENT OF HON. STEVEN CHU, SECRETARY


              opening statement of senator byron l. dorgan


    Senator Dorgan. I'm going to call the hearing to order. 
This is a hearing of the Energy and Water Subcommittee of the 
Appropriations Committee. Dr. Chu, we welcome you to the 
subcommittee this morning. I'm sorry for the inconvenience. 
We're starting a few minutes late. I think probably all three 
of us were on the floor of the Senate, waiting for a 10 or 
10:15 vote to occur, and we were just informed it won't occur 
now, but will occur sometime in the future, either in the short 
term or the longer term, any moment, or perhaps sometime today. 
So that's the reason I was a bit delayed.
    We have asked Secretary Chu from the Department of Energy 
to come and present and discuss the 2010 budget. My expectation 
is that we will be truncated a bit and probably be interrupted 
with a short recess for a cloture vote. I want to note that we 
will have Administrator D'Agostino before the subcommittee on 
June 2, to discuss the National Nuclear Security 
Administration's budget request. We're free to discuss any of 
that today as well, but I simply want to remind members that 
there will be further opportunity to discuss that in 2 weeks' 
time.
    This year's budget of $27.1 billion for the Department is 
basically flat compared to 2009 appropriation numbers. A 
substantial sum of money, a great deal of money, was provided--
$38.7 billion as a part of the American Recovery and 
Reinvestment Act. Those numbers, of course, were not intended 
to be a substitute for the regular budget. They were intended 
for the purpose of moving money around the country, getting 
people to work, getting contractors working and building 
projects and doing things that are of substantial value, and 
creating assets for the future.
    I was a bit surprised when I received the President's 
budget. Because I felt that with the economy recovery funds, a 
very substantial amount of money, $38.7 billion, to the 
Department, that we might see a very different approach in 
trying to deal with the priorities in the Department. And I'm 
going to talk to you today about some of the strengths that I 
see in the budget request and some of the concerns that I have.
    I think there are some good stories in the funding increase 
proposals. I think we have to maximize the capability of 
renewable energy in our country. In order to do that, we not 
only have to say, ``Here's where the country's headed,'' and 
plot a map to get there, but we have to create the capability 
to have an interstate transmission capability that connects all 
of America. That's not easy, that's very difficult to do.
    The science budget is robust. There's also a proposal for 
eight new Energy Innovation Hubs, which I view as a means of 
helping the Department of Energy address what normally people 
call the Valley of Death, the dilemma of getting technology 
transferred from basic science to applied research and then out 
into the marketplace, so that it accomplishes what we intend to 
accomplish in the field of energy for our country's future.
    I'm going to just truncate my statement. I will, during the 
questioning, have an opportunity to go through a wide range of 
subjects with you, Secretary Chu. I think what I'd like to do, 
with the permission of our colleagues, is call on Senator 
Bennett for a brief opening statement, call on the Secretary to 
make a presentation. Perhaps about that time, we'll have to go 
over for the cloture vote. And then come back and have 
substantial opportunity this morning to ask questions of the 
Secretary.
    If that is all right with my colleagues, let me call on the 
ranking member, Senator Bennett.


             OPENING STATEMENT OF SENATOR ROBERT F. BENNETT


    Senator Bennett. Thank you very much, Mr. Chairman. I will 
abbreviate my opening statement. Mr. Secretary, welcome to the 
subcommittee. We're glad to have you here in your first 
experience in defending your budget. And having served in the 
executive branch myself, I know that this isn't entirely your 
budget, that the OMB has had a few suggestions, shall we say. 
And you may or may not be pleased with those, but I won't call 
on you to defend or comment on those.
    Just a few highlights, you apply additional resources to 
programs that appear to already enjoy some surpluses, but fail 
to address chronic pension shortfalls that have been created by 
the poor market performance. Now, I understand that these could 
not be foreseen, but I don't think it's acceptable to ignore 
the estimated $500 to $600 million shortfall spread across the 
Department and the impact that that will have in undercutting 
scientific and cleanup missions.
    I continue my interest in NNSA and the labs, and would be 
interested in talking to you about that and some of the 
comments that you've made there. The Office of Science and 
Renewable Energy has received nearly 50 percent of the stimulus 
funding, and it seems unlikely that this will be spent before 
the 2010 deadline. So we could talk about how that could be 
shifted, it's not a matter of I don't favor this kind of thing, 
but you can only shovel so much money out the door in certain 
circumstances, and that's one thing that I would look at.
    Funding for environmental cleanup is down $161 million. 
There are two other factors that significantly increase the 
deficit of this program. It fails to fully fund the pension 
shortfalls that will reduce environmental cleanup by an 
estimated $400 million in fiscal year 2010, and I've included 
an amendment to the budget resolution to mitigate the impacts 
that budgets will have on the cleanup. And I'm grateful, Mr. 
Chairman, for your support in that effort.
    The budget includes a $200 million tax on uranium fuel to 
be paid by utilities, offsetting this to our overall budget 
authority. If we don't do this--and it's frankly a little bit 
of a budget gimmick--it creates a $200 million shortfall in our 
bill. And this revenue isn't necessary, as there is $4.5 
billion in existing balances. Those kinds of details, we would 
talk through.
    So with that, Mr. Chairman, I will leave it there and do 
the best we can to move the hearing forward.
    Senator Dorgan. Senator Bennett, thank you very much. Mr. 
Secretary, I know that you personally worked hard on the budget 
that was presented to us, but you did so with very limited time 
and also with very limited staff. I regret that a good number 
of your nominations are all being held up. I have spoken to the 
Senator that has the hold. It's a hold that's very Byzantine, 
as far as I'm concerned, because that Senator has been promised 
a hearing date, which is what he wanted. So I hope that you get 
those nominations through so that you can have a full 
complement of staff.
    But having done what you have done, please tell us the 
justification for the administration's budget proposals for the 
Department of Energy. Mr. Secretary, thank you for being here.


                      STATEMENT OF HON. STEVEN CHU


    Secretary Chu. Okay, thank you. Chairman Dorgan, Ranking 
Member Bennett, members of the subcommittee, I am pleased to be 
before you today to present President Obama's fiscal year 2010 
budget request for the Department of Energy.
    The President's 2010 budget seeks to usher in a new era of 
responsibility, an era in which we invest to create new jobs 
and lift our economy out of recession, while laying a new 
foundation for our long-term growth and prosperity.
    President Obama's 2010 budget invests in clean, renewable 
sources of energy, so we can reduce our dependence on oil, 
address the threat of a changing climate, and become the world 
leader in new, clean energy economy.
    The 2010 budget request for the Department of Energy is 
$26.4 billion, essentially flat compared to fiscal year 2009, 
and it complements the significant energy investments in the 
American Recovery and Reinvestment Act. This budget request 
emphasizes science, discovery, and innovation to support the 
key missions of the Department.
    My written testimony includes an extensive breakdown of 
this budget, and I'd like to use this time briefly to highlight 
a few numbers and areas of particular importance. To promote 
nuclear security in the President's ambitious non-proliferation 
goals, the budget requests $9.9 billion for the National 
Nuclear Security Administration.
    To continue to accelerate legacy cleanup of our Nation's 
nuclear weapons production, the budget requests $5.8 billion 
for the Office of Environmental Management. To bolster the 
Department's commitment to scientific discovery, the budget 
requests $4.9 billion for the Office of Science. And fostering 
the revolution in energy supply and demand while positioning 
the United States to lead on a global climate change policy, 
the budget includes requests for a range of energy investments, 
including $882 million for the Office of Fossil Energy, $845 
million for the Office of Nuclear Energy, and $2.3 billion for 
the Office of Energy Efficiency and Renewable Energy.
    That clean energy funding includes several notable 
strategic investments, even as this budget holds the line on 
spending overall. Solar power will receive $320 million, an 
increase of 82 percent. Wind energy is funded at $75 million, 
an increase of 36 percent. Funding for clean vehicle programs 
is up 22 percent to $333 million, and funding for building 
technologies is increased by 69 percent to $238 million.
    Another significant increase is in the Office of 
Electricity Delivery and Energy Reliability, which received 
$208 million, 52 percent more than in fiscal year 2009, as it 
works to develop a new smart electric grid. The request also 
includes funding to implement the Loan Guarantee Program and 
Advanced Technology Vehicle Manufacturing Loan Program.
    With that brief overview, I want to turn to one of my top 
priorities in the budget as Secretary, amplifying the Office of 
Science's fundamental research with innovative approaches to 
solving the Nation's energy problems. Specifically, this budget 
request includes three initiatives designed to cover a spectrum 
of basic to applied science to maximize our chances of energy 
breakthroughs. The fiscal year 2010 budget will launch eight 
Energy Innovation Hubs, while the Energy Frontier Research 
Centers and the ARPA-E were launched last month.
    Let me briefly explain the differences among these 
initiatives and why I believe launching these hubs is so 
important. The EFRCs are small-scale collaborations, 
predominately universities, that focus on overcoming known 
hurdles in basic science that block energy breakthroughs, not 
on developing energy technologies themselves.
    ARPA-E is a highly entrepreneurial funding model that 
explores potentially revolutionary technologies that are too 
risky for industry to fund. The proposed Energy Innovation Hubs 
will take a very different approach. They will be multi-
disciplinary, highly collaborative teams, ideally working under 
one roof to solve priority technology challenges, such as 
artificial photosynthesis, or creating fuels from sunlight.
    A few years ago, I changed the course of my scientific work 
to focus on solving our energy and climate challenges because 
of the urgency of this issue and because I remain optimistic 
that science can offer better solutions than we can imagine 
today. But those solutions will only come if we harness the 
creativity and ingenuity and intellectual horsepower of our 
best scientists in the right way.
    I'm convinced that launching Energy Innovation Hubs is a 
critical next step in this effort. Bringing together the best 
scientists from different disciplines in a collaborative effort 
is our best hope of achieving priority goals, such as making 
solar energy cost competitive with fossil fuels, or developing 
new building designs that use dramatically less energy, or 
developing an economical battery that will take your car 300 
miles without recharging.
    These are the breakthroughs we need, and the Energy 
Innovation Hubs will help us achieve them. I saw the power of 
truly collaborative science like this firsthand during my time 
at Bell Laboratories. I believe that to solve the energy 
problem, the Department of Energy must strive to be the modern 
version of Bell Laboratories in energy research, and this is 
what these hubs will do. These investments will pay for 
themselves many times over and enhance America's 
competitiveness on the green energy jobs of tomorrow.
    A final initiative in the fiscal year 2010 budget is a 
comprehensive K-20+ science and engineering effort called RE-
ENERGYSE, standing for REgaining our ENERGY Science and 
Engineering Edge, funded at $115 million. Through RE-ENERGYSE, 
the Department will partner with the National Science 
Foundation to educate thousands of students at all levels in 
the fields that contribute to our fundamental understanding of 
energy science and engineering systems.


                           PREPARED STATEMENT


    It is my firm belief that the short-term impact of the 
Recovery Act, combined with the long-term vision in President 
Obama's fiscal year 2010 budget, will lay the necessary 
groundwork for a clean economy. Both President Obama and I look 
forward to working with the 111th Congress to make this vision 
a reality. I appreciate this opportunity to appear before you, 
and I'm happy to take questions at this time.
    [The statement follows:]

                 Prepared Statement of Hon. Steven Chu

    Chairman Dorgan, Ranking Member Bennett, members of the 
subcommittee, I am pleased to be before you today to present President 
Obama's fiscal year 2010 budget request for the Department of Energy.
    The President's 2010 budget seeks to usher in a new era of 
responsibility--an era in which we invest to create new jobs and lift 
our economy out of recession, while laying a new foundation for our 
long-term growth and prosperity.
    The fiscal year 2010 budget request of $26.4 billion provides the 
next critical investment in a multi-year effort to address the 
interconnected challenges of economic uncertainty, U.S. dependence on 
oil, and the threat of a changing climate by transforming the way our 
Nation produces and consumes energy. Meeting these challenges will 
require both swift action in the near-term and a sustained commitment 
for the long term to build a new economy powered by clean, reliable, 
affordable and secure energy. We will also train the next generation of 
a technical workforce and the scientific researchers needed to maintain 
the United States' preeminent position in science and technology. At 
its core, this budget request emphasizes science, discovery, and 
innovation to support the key missions of the Department.
    I want to note at the outset that in developing the fiscal year 
2010 request the Department considered that the $38.7 billion of 
American Recovery and Reinvestment Act of 2009 (Recovery Act) funding 
received by the Department allows for the acceleration of a number of 
important commitments. The Recovery Act makes investments in energy 
conservation and renewable energy sources ($16.8 billion), 
environmental management ($6 billion), loan guarantees for renewable 
energy and electric power transmission projects ($6 billion), grid 
modernization ($4.5 billion), carbon capture and sequestration ($3.4 
billion), basic scientific research ($1.6 billion), and the 
establishment of the Advanced Research Projects Agency-Energy (ARPA-E) 
($400 million). These investments will help jumpstart the economy, save 
and create jobs, and serve as a down payment on addressing fundamental 
energy challenges, while reducing carbon emissions and U.S. dependence 
on oil.

      INVESTING IN SCIENCE TO ACHIEVE TRANSFORMATIONAL DISCOVERIES

    The fiscal year 2010 budget request supports our strategic 
framework by:
  --Investing in science to achieve transformational discoveries;
  --Fostering the revolution in energy supply and demand while 
        positioning the United States to lead on global climate change 
        policy;
  --Increasing American economic competitiveness;
  --Maintaining the nuclear deterrent, reducing the risk of nuclear 
        proliferation, and advancing nuclear legacy cleanup; and
  --Improving the management of the Department.
    The President has committed to doubling Federal investment in basic 
research over 10 years. The Department will support this commitment by 
investing in basic and applied research, creating new incentives for 
private innovation, and promoting breakthroughs in energy. Our Nation's 
ability to sustain a growing economy and a rising standard of living 
for all Americans depends on continued advances in science and 
technology. Scientific and technological discovery and innovation are 
the major engines of increasing productivity and are indispensable to 
ensuring economic growth, job creation, and rising incomes for American 
families in the technologically-driven 21st century.
    As Secretary, one of my top priorities is to amplify the 
fundamental research undertaken by the Office of Science with novel 
approaches to solving the Nation's energy problems. While the 
Department has made important contributions over the years, despite 
almost three decades of effort, we are still confronted by the 
fundamental problems of energy security and environmental degradation 
from our energy use. That is why I am proposing new approaches to 
solving the energy question. Specifically, this budget request includes 
three initiatives designed to cover the spectrum of basic to applied 
science to maximize our chances of energy breakthroughs. The fiscal 
year 2010 budget will launch eight Energy Innovation Hubs, while the 
Energy Frontier Research Centers (EFRCs) and ARPA-E were launched last 
month.
    Let me briefly explain the differences and why I believe launching 
these Hubs is so important.
    EFRCs are small-scale collaborations (predominantly at 
universities) that focus on overcoming known hurdles in basic science 
that block energy breakthroughs--not on developing energy technologies 
themselves.
    ARPA-E is a highly entrepreneurial funding model that explores 
potentially revolutionary technologies that are too risky for industry 
to fund.
    The proposed Energy Innovation Hubs will take a very different 
approach--they will be multi-disciplinary, highly collaborative teams 
ideally working under one roof to solve priority technology challenges, 
such as artificial photosynthesis (creating fuels from sunlight).
    A few years ago, I changed the course of my scientific work to 
focus on solving our energy and climate challenges. I did so because of 
the great national and global urgency of this issue--but also because, 
as a scientist, I remain optimistic that science can offer us better 
solutions than we can imagine today. But those solutions won't come 
easily; they will only come if we harness the creativity and ingenuity 
and intellectual horsepower of our best scientists in the right way.
    Having dedicated the last several years of my work to solving the 
energy challenge, I'm convinced that launching Energy Innovation Hubs 
is a critical next step in this effort. Bringing together the best 
scientists from different disciplines in collaborative efforts is our 
best hope of achieving priority goals such as making solar energy cost 
competitive with fossil fuels, or developing new building designs that 
use dramatically less energy, or developing an economical battery that 
will take your car 300 miles without recharging.
    These are the breakthroughs we need--and the Energy Innovation Hubs 
will help us achieve them. I saw the power of truly collaborative 
science like this firsthand during my time at Bell Laboratories. I 
believe that to solve the energy problem, the Department of Energy must 
strive to be the modern version of Bell Labs in energy research, and 
that is what these Hubs will do.
    The scientific collaboration the Hubs will foster will be unique 
and indispensable, and must be backed by a meaningful and sustained 
investment. These investments will pay for themselves many times over, 
ensuring American leadership and American competitiveness when it comes 
to the green energy jobs of tomorrow.
    The following is additional information about the three 
initiatives:
  --Energy Innovation Hubs.--In fiscal year 2010 the Department 
        proposes to fund eight multi-disciplinary Energy Innovation 
        Hubs, at a total of $280 million. Modeled after the 
        Department's Bioenergy Research Centers, the work of the Hubs 
        will span from basic research to engineering development to 
        commercialization and a hand-off to industry. Each Hub will be 
        funded at $25 million per year, with one-time additional start-
        up funding of $10 million in the first year for renovation, 
        equipment and instrumentation.
      The Hubs will support cross-disciplinary research and development 
        focused on the barriers to transforming energy technologies 
        into commercially deployable materials, devices, and systems. 
        They will advance highly promising areas of energy science and 
        technology from their early stages of research to the point 
        that the risk level will be low enough for industry to deploy 
        them into the marketplace. While the intent is to provide a 
        funding stream that is more dependable than the standard 
        funding mechanisms, renewal after 5 years will not be 
        automatic. To receive renewed funding, Hubs will be expected to 
        be delivering exceptional scientific progress.
      The research Hubs will explore the following topics: Solar 
        Electricity; Fuels from Sunlight; Batteries and Energy Storage; 
        Carbon Capture and Storage; Grid Materials, Devices, and 
        Systems; Energy Efficient Building Systems Design; Extreme 
        Materials; and Modeling and Simulation.
  --Energy Frontier Research Centers.--In fiscal year 2010 the 
        Department of Energy will continue to support Energy Frontier 
        Research Centers (EFRC). Currently there are 46 EFRCs, funded 
        at $2 to $5 million per year. These centers enlist the talents 
        and skills of the very best scientists and engineers to address 
        current fundamental scientific roadblocks to clean energy and 
        energy security. Roughly one-third of the centers are supported 
        by Recovery Act funding. These centers, involving almost 1,800 
        researchers and students from universities, national labs, 
        industry, and non-profit organizations from 36 States and the 
        District of Columbia, address the full range of energy research 
        challenges in renewable and low-carbon energy, energy 
        efficiency, energy storage, and cross-cutting science. EFRC 
        researchers take advantage of new capabilities in 
        nanotechnology, light sources that are a million times brighter 
        than the sun, supercomputers, and other advanced 
        instrumentation, much of it developed in collaboration with the 
        Department of Energy's Office of Science.
  --Advanced Research Projects Agency-Energy (ARPA-E).--ARPA-E is a new 
        Department of Energy organization modeled after the Defense 
        Advanced Research Projects Agency, created during the 
        Eisenhower administration in response to Sputnik. The Recovery 
        Act provided $400 million and the fiscal year 2010 budget 
        requests $10 million for ARPA-E. The purpose of ARPA-E is to 
        advance high-risk, high-reward energy research projects that 
        can yield revolutionary changes in how we produce, distribute, 
        and use energy. It will ensure that the United States maintains 
        a technological lead in developing and deploying advanced 
        energy technologies.
      ARPA-E seeks out the best ideas and assembles teams that can move 
        quickly to help bring the idea to market, and funds this work 
        through grants that range between $500,000 and $10 million. 
        Most projects will be funded with seed money that sunsets after 
        3 years. Research teams are expected to either make 
        exceptionally rapid progress or bring their technology to the 
        point the private sector can pick it up within that time.
    These initiatives will be augmented with a broad educational effort 
that cuts across DOE program offices to inspire students and workers to 
pursue careers in science, engineering, and entrepreneurship 
specifically related to clean energy. This education effort will help 
to develop the scientific and technical expertise to sustain the new 
energy economy and increase American competitiveness.
  --RE-ENERGYSE (REgaining our ENERGY Science and Engineering Edge).--
        As part of President Obama's recent address before the National 
        Academy of Sciences on reinvigorating scientific research and 
        innovation in the United States, the President announced a 
        joint education initiative between the National Science 
        Foundation and the Department of Energy to ``inspire tens of 
        thousands American students to pursue careers in science, 
        engineering and entrepreneurship related to clean energy.''
      As part of this initiative, the Department will launch a 
        comprehensive K-20+ science and engineering initiative, funded 
        at $115 million in fiscal year 2010, to educate thousands of 
        students at all levels in the fields contributing to the 
        fundamental understanding of energy science and engineering 
        systems. This initiative, which complements the Department's 
        other education efforts, will provide graduate research 
        fellowships in scientific and technical fields that advance the 
        Department's energy mission; provide training grants to 
        universities that establish multidisciplinary research and 
        education programs related to clean energy; support 
        universities that dramatically expand energy-related research 
        opportunities for undergraduates; build partnerships between 
        community colleges and different segments of the clean tech 
        industry to develop customized curriculum for ``green collar'' 
        jobs; and increase public awareness, particularly among young 
        people, about the role that science and technology can play in 
        responsible environmental stewardship.

Office of Science
    The fiscal year 2010 budget requests $4.9 billion for the Office of 
Science, a $184 million increase over fiscal year 2009. In general, the 
2010 request will focus on breakthrough science while developing and 
nurturing science and engineering talent. It will also increase funding 
for climate science and continue America's role in international 
science and energy experiments. The budget also invests in the next 
generation of America's scientists by expanding graduate fellowship 
programs in critical energy-related fields. This funding builds upon 
the $1.6 billion provided in the Recovery Act for basic science 
programs at the Department of Energy.
    The Office of Science supports investigators from more than 300 
academic institutions and from all of the DOE laboratories. The fiscal 
year 2010 budget request will support about 25,000 Ph.D.s, graduate 
students, undergraduates, engineers, and technicians. Approximately 
24,000 researchers from universities, national laboratories, industry, 
and international partners are expected to use the Office of Science's 
scientific user facilities. The fiscal year 2010 request supports the 
President's plan to increase Federal investment in the sciences and 
train students and researchers in critical fields, to invest in areas 
critical to our clean energy future, and to make the United States a 
leader on climate change.
    Two of the Department's eight Energy Innovation Hubs are requested 
in the Office of Science in fiscal year 2010 ($70 million). These Hubs 
will bring together teams of experts from multiple disciplines to focus 
on two grand challenges in energy: the creation of fuels directly from 
sunlight without the use of plants or microbes and advanced methods of 
electrical energy storage.
    The Office of Science supports a diverse number of research 
programs including:
  --High-Energy Physics ($819 million)
  --Nuclear Physics ($552 million)
  --Biological and Environmental Research ($604 million)
  --Basic Energy Sciences ($1.7 billion)
  --Advanced Scientific Computing Research ($409 million)
  --Fusion Energy Sciences ($421 million)
fostering the revolution in energy supply and demand while positioning 
       the united states to lead on global climate change policy
    U.S. dependence on oil is a national security challenge. 
Furthermore, the United States has a responsibility to curb carbon 
emissions to mitigate the effects of global climate change. The fiscal 
year 2010 budget request will expand the use of low-carbon and 
renewable energy sources and efficiency, and support the Smart Grid. 
Deploying these technologies will position the United States to lead on 
global climate change policy.

Energy Efficiency and Renewables
    Achieving these goals requires changes to both the demand and 
supply of energy. DOE is addressing both by improving the Nation's 
energy efficiency to reduce energy demand and by investing in 
technologies and approaches to transform energy supply and 
transmission. The fiscal year 2010 budget request of $2.3 billion for 
the Office of Energy Efficiency and Renewable Energy (EERE) will 
transform the Nation's energy infrastructure by investing in a variety 
of renewable sources of electricity generation and deploying 
technologies to reduce our dependence on oil and decrease energy use in 
homes, transportation, and industry. These sources of energy will 
reduce the production of GHG emissions and usher in a revitalized 
economy built on the next generation of domestic production. 
Investments in efficiency R&D, grants to States and weatherization 
assistance will have immediately tangible benefits by reducing energy 
use, lowering energy bills, and reducing GHG emissions and helping to 
create jobs across the country.
    This budget request for EERE provides a diverse portfolio of 
solutions to our energy and environmental challenges. This starts with 
improving energy efficiency, which can be one of the cheapest, cleanest 
means of reducing greenhouse gas emissions. The budget includes 
significant increases in several programs in support of the President's 
efforts to promote energy efficiency, including these increases:
  --Building Technology Program $238 million (+$98 million or 69 
        percent)
  --Vehicle Technology Program $333 million (+$60 million or 22 
        percent); and
    The budget continues the shift to clean and renewable energy, 
including these increases:
  --Solar Energy Program $320 million (+$145 million, or 82 percent);
  --Wind Energy Program $75 million (+$20 million, or 36 percent); and
  --Geothermal Program $50 million (+$6 million or 14 percent.)
    The budget also has funding for:
  --Fuel Cells Technology ($68.2 million)
  --Biomass and Biorefinery Systems R&D ($235 million)
  --Water Power ($30 million)
  --Industrial Technologies ($100 million)
  --FEMP ($32.3 million)
  --Weatherization ($220 million)
  --State Energy Program Grants ($75 million)

Electricity Transmission and Reliability
    The Nation's ability to meet the growing demand for reliable 
electricity is challenged by an aging electricity transmission and 
distribution system and by vulnerabilities in the U.S. energy supply 
chain. Despite increasing demand, the United States has experienced a 
long period of underinvestment in power transmission and infrastructure 
maintenance. The majority of the power delivery system was built on 
technology developed in the 1960s, 1970s and 1980s and is limited by 
the speed with which it can respond to disturbances. This limitation 
increases the vulnerability of the power system to outages that can 
spread quickly and have regional effects. Deploying the next generation 
of clean energy sources will require modernization of U.S. energy 
infrastructure which will rely on digital network controls and 
transmission, distribution and storage breakthroughs.
    The proposed fiscal year 2010 Office of Electricity Delivery and 
Energy Reliability budget provides $208 million, an increase of 52 
percent over fiscal year 2009, and builds on the ``smart grid'' 
investments and other activities to modernize and secure the electric 
grid provided by $4.5 billion of Recovery Act funds, supporting the 
following areas:
  --Clean energy transmission and reliability ($42 million)
  --Smart grid research and development ($67 million)
  --Energy storage ($15 million)
  --Cyber security for energy delivery systems ($50 million)
  --Permitting, siting and analysis ($6.4 million)
  --Infrastructure security and energy restoration ($6.2 million)

Fossil Energy
    The fiscal year 2010 budget request of $882 million for the Office 
of Fossil Energy (FE) will help ensure that the United States can 
utilize traditional domestic energy resources in a clean and affordable 
manner. The United States has 25 percent of the world's coal reserves, 
and fossil fuels currently supply 86 percent of the Nation's energy. 
Low-carbon emissions coal plants and production of methane (natural 
gas) from gas hydrates will help allow fossil fuels to be used as 
abundant and low-carbon emitting energy resources. In direct support of 
the Department of Energy's Energy Security mission, $229 million of the 
$882 million has been requested to provide operations, maintenance and 
repair funding for a Strategic Petroleum Reserve program that is 
environmentally responsible and fully responsive to the needs of the 
Nation and the public, protecting against potential disruptions in 
foreign and domestic petroleum supplies.
    The Department is committed to advancing Carbon Capture and Storage 
(CCS) technologies in order to promote cleaner and efficient use of 
fossil fuels. The $3.4 billion in Recovery Act funds, combined with 
$222 million requested in fiscal year 2010 for CCS research and 
development, is the keystone of the Department's clean coal research 
program which seeks to establish the capability of producing 
electricity from coal with dramatically reduced atmospheric emissions 
of carbon dioxide.
    In fiscal year 2010, the Energy Innovation Hub for CCS will focus 
on enabling fundamental advances and discovery of novel and 
revolutionary capture/separation approaches to dramatically reduce the 
energy penalty and cost associated with CO2 capture.
    The fiscal year 2010 budget request for FE funds the following 
areas:
  --Coal ($403.9 million) including $179.9 million for carbon 
        sequestration
  --Fossil energy research and development ($617.6 million)
  --Naval Petroleum and Oil Shale Reserves ($23.6 million)
  --Strategic Petroleum Reserve ($229.1 million)
  --Northeast Home Heating Oil Reserve ($11.3 million)

Nuclear Energy
    The $845 million budget request for the Office of Nuclear Energy 
(NE) recognizes that nuclear energy is a fundamental component of the 
energy mix which currently supplies approximately 20 percent of the 
Nation's electricity and over 70 percent of low carbon emitting 
electricity.
    In order to research and develop nuclear energy technologies that 
could help meet non-proliferation and climate goals, and to maintain 
the national nuclear technology infrastructure, the fiscal year 2010 
budget request for NE funds the following areas:
  --Nuclear Power 2010 ($20 million)
  --Generation IV ($191 million)
  --Fuel Cycle Research and Development Program ($192 million)
  --Radiological Facilities Management ($77 million)
  --Idaho Facilities Management ($203 million)

Loan Guarantee Program
    In fiscal year 2010, the DOE will continue to accelerate the 
availability of loans for innovative technologies through the Loan 
Guarantee Program, while ensuring taxpayer interests are protected. The 
Department requests $43.0 million in funding in fiscal year 2010 to 
operate the Office and support personnel and associated costs. This 
request will be offset by collections authorized under title XVII of 
the Energy Policy Act of 2005 (EPACT 2005). Additionally, the fiscal 
year 2010 budget provides $20 million for administrative costs to help 
enable the Advanced Technology Vehicle Manufacturing Loan Program to 
support up to $25 billion in loans to automobile and automobile part 
manufacturers for re-equipping, expanding, or establishing 
manufacturing facilities to produce advanced technology vehicles or 
qualified components.

    MAINTAINING THE NUCLEAR DETERRENT, REDUCING THE RISK OF NUCLEAR 
          PROLIFERATION, AND ADVANCING NUCLEAR LEGACY CLEAN-UP

Nuclear Security
    The National Nuclear Security Administration (NNSA) continues 
significant efforts to meet administration and secretarial priorities, 
leveraging science to promote national security. The fiscal year 2010 
President's budget request is $9.9 billion, which is $815 million more 
than the fiscal year 2009 request, to meet defense and homeland 
security-related objectives.
    The United States continues a fundamental shift in national 
security strategy to address the realities of the 21st century. The 
fiscal year 2004 directed reductions to the U.S. nuclear weapons 
stockpile were completed in 2007, 5 years early. Today's nuclear 
weapons stockpile is now the size envisioned for 2012, and by 2012 it 
will be almost 15 percent less than that--a total that is just 25 
percent of what it was at the end of the cold war. Consistent with the 
administration's Nuclear Posture Review, the Department of Energy has 
created a vision for a revitalized nuclear weapons complex that is 
significantly more agile and responsive, and will allow further 
reductions in the nuclear stockpile by providing an industrial hedge 
against geopolitical or technical problems.
    The fiscal year 2010 budget request for NNSA funds the following 
areas:
  --Weapons Activities ($6.4 billion)
  --Defense Nuclear Nonproliferation ($2.14 billion)
  --Naval Reactors ($1.0 billion): $175 million increase from fiscal 
        year 2009
  --Office of the Administrator ($420.8 million)

Environmental Management
    The Federal Government has the dual responsibilities of addressing 
the nuclear weapons production legacy of our past and providing the 
necessary environmental infrastructure for today that will ensure a 
clean, safe and healthy environment for future generations. To deliver 
on the Department's obligations stemming from 50 years of nuclear 
research and weapons production during the cold war, the Office of 
Environmental Management (EM) continues to focus its resources on those 
activities that will yield the greatest risk reductions, with safety as 
the utmost priority. To achieve a balance of risk reduction and 
environmental cleanup, the fiscal year 2010 request of $5.8 billion, a 
decrease of 3 percent from fiscal year 2009, builds upon the $6 billion 
in Recovery Act funding. These investments are already having an 
impact. Fifty skilled new workers recently reported to work at the 
Savannah River Site.
    This request supports the following activities, in priority order:
  --Essential activities to maintain a safe and secure posture in the 
        EM complex
  --Radioactive tank waste stabilization, treatment, and disposal
  --Spent nuclear fuel storage, receipt and disposition
  --Special nuclear material consolidation, processing, and disposition
  --High priority groundwater remediation
  --Transuranic and mixed/low level waste disposition
  --Soil and groundwater remediation
  --Excess facilities deactivation & decommissioning
    In developing the fiscal year 2010 budget for its environmental 
cleanup efforts, the Department will focus on achieving the greatest 
risk reduction, while also incorporating regulatory compliance 
commitments and best business practices, to maximize cleanup progress. 
In fiscal year 2010, EM is aggressively pursuing the consolidation and 
disposition of surplus plutonium and other special nuclear materials to 
enhance national security and to minimize the storage risks and costs 
associated with these materials. In addition, EM continues to make 
significant progress on the construction and operation of waste 
treatment and immobilization facilities across the complex. The budget 
continues shipments of remote-handled transuranic waste to the Waste 
Isolation Pilot Plant.
    The fiscal year 2010 budget request for EM funds the following 
activities:
  --Non-Defense Environmental Management ($238 million)
  --Defense Environmental Management ($5.5 billion)
  --UED&D Fund ($559 million)

Yucca Mountain
    The fiscal year 2010 budget request of $197 million for OCRWM 
implements the administration's decision to terminate the Yucca 
Mountain program while developing nuclear waste disposal alternatives. 
All funding for development of the Yucca Mountain facility would be 
eliminated, such as further land acquisition, transportation access, 
and additional engineering. The budget request includes the minimal 
funding needed to explore alternatives for nuclear waste disposal 
through OCRWM and to continue participation in the Nuclear Regulatory 
Commission (NRC) license application process, consistent with the 
provisions of the Nuclear Waste Policy Act. The administration intends 
to convene a ``blue-ribbon'' panel of experts to evaluate alternative 
approaches for meeting the Federal responsibility to manage and 
ultimately dispose of spent nuclear fuel and high-level radioactive 
waste from both commercial and defense activities. The panel will 
provide the opportunity for a meaningful dialogue on how best to 
address this challenging issue and will provide recommendations for 
managing and disposing of spent nuclear fuel and high-level radioactive 
waste.

               IMPROVING THE MANAGEMENT OF THE DEPARTMENT

    As Secretary, I am making a concerted effort to improve management 
throughout the Department. The Department is committed to strengthening 
its management to implement the $26.4 billion fiscal year 2010 request 
and $38.7 billion of Recovery Act funds. The Department has developed 
strong oversight strategies for Recovery Act implementation, including 
upfront risk assessments and building specific risk management plans, 
upgrading process controls, establishing personal risk assurance 
accountabilities, and expanding outreach, training, and coordination 
between Headquarters and field offices. The Recovery Act, however, is 
only one aspect of a much larger effort to improve the Department's 
management.
    As part of President Obama's commitment to fiscal discipline, DOE 
will focus on using its resources responsibly, transparently, and 
effectively by identifying potential savings throughout the agency. The 
fiscal year 2010 budget request of $182.3 million for Departmental 
Administration, along with resources in individual program offices, 
will continue the improvement in key functional areas such as human, 
financial, project, and information technology management. These 
efforts will instill management excellence and encourage the most 
efficient use of the Department's resources.
    The Office of the Chief Information Officer (CIO) will receive 
$104.5 million, $33.4 million of which will go to cybersecurity and 
secure communications, $9.4 million to the corporate management 
information program, and $23.6 million for energy information 
technology services.
    The Office of the Chief Financial Officer will continue its effort 
in fiscal year 2010 to build and improve its integrated business 
management system, iMANAGE, with the deployment of budget execution and 
formulation modules such as iBUDGET. To accomplish this and other 
goals, the CFO's office will receive $66 million in the fiscal year 
2010 budget. A significant portion of the increase is to assume costs 
previously carried by the CIO for accounting systems operations.
    The Office of Management ($88.4 million) and the Office of Human 
Capital Management ($29.5 million) will help ensure effective and 
efficient management principles permeate from top to bottom at the 
Department of Energy. The Department has been making steady progress in 
improving project management and developed an action plan with concrete 
steps and scheduled milestones to successfully address the root causes 
of the major challenges to planning and managing Department projects. 
The action plan identifies eight measures that, when fulfilled, will 
result in significant, measurable, and sustainable improvements in the 
Department's contract and project management performance and culture. 
Primary actions include: strengthened front-end planning, optimized 
staffing, improved risk management, better alignment of funding 
profiles and cost baselines, strengthened cost estimating capability, 
improved acquisition strategies and plans, improved oversight, and 
stricter adherence to project management requirements.
    The Department's human capital management efforts are focused on an 
integrated approach that ensures human capital programs and policies 
are linked to the Department's missions, strategies, and strategic 
goals, while providing for continuous improvement in efficiency and 
effectiveness. The Department is revising its human capital management 
strategic plan to address future organizational needs, workforce size, 
skill gaps, performance management systems and diversity. To accomplish 
this goal, the Department will continue to implement strategies to 
attract, motivate and retain a highly skilled and diverse workforce to 
meet the future needs of the Nation in such vital areas as scientific 
discovery and innovation.

                               CONCLUSION

    It is my firm belief that the short-term impact of the Recovery Act 
combined with the new approaches and long-term vision in President 
Obama's fiscal year 2010 budget, will lay the groundwork necessary for 
creating the new green economy. Both President Obama and I look forward 
to working with the 111th Congress to make this vision a reality.
    I appreciate the opportunity to appear before you to present the 
fiscal year 2010 budget proposal for the Department of Energy. I will 
be happy to take any questions that the chairman and members of the 
subcommittee may have at this time.

                          FUNDING ALLOCATIONS

    Senator Dorgan. Mr. Secretary, thank you very much for your 
testimony. I have a good many questions, so I will begin with 
the first few questions, and then my colleagues will ask 
questions, and I will be able to stay and ask remaining 
questions.
    Let me ask you about coal. I asked during, I believe it was 
your confirmation hearing, about the statement, ``Coal is my 
worst nightmare,'' that you made, and you described the context 
of that statement, and I understand it.
    This budget essentially flat funds coal research and 
development. The fact is, coal is our most abundant resource by 
far, not even close. If it's our most abundant resource--and I 
and many others believe and I would hope you believe that we 
can continue to use coal, because we can use science, research, 
and technology to decarbonize coal--then how do we get there if 
we flat fund research and development with respect to coal?
    So can you give me a little bit of the philosophy that led 
to a flat funding for that account? Given what the President 
said about the substantial front-end investments for these 
kinds of things, I would have expected a very substantial 
recommended increase, in order for us to use coal in our 
future, because it's our most abundant resource.
    Secretary Chu. Well, Mr. Chairman, I agree with you, and I 
have to say that this budget reflects that because it has 
folded in the fact that we have received $3.4 billion, 
substantial funds, in the American Recovery and Reinvestment 
Act. Many of the pilot programs for that money, $3.4 billion 
that might have been funded in this section now have gone over 
to that.
    So in a certain sense, that incredibly large amount of 
funding for these pilot programs and the investigations are 
then, say, ``well, we will continue this current budget'', 
certainly if it were not for the Recovery Act funds, you would 
have seen a different budget.
    So even though I know the philosophy of the Recovery Act 
was to be seen as strictly supplemental, in the context of that 
addition, I think it's reasonable.
    Senator Dorgan. Well, that was the philosophy, actually. 
But I think most of the stimulus funding is considered to be 
demonstration projects rather than R&D. In the area of solar, 
which I support, and some other areas, even though there was 
substantial money in the stimulus, there's also substantial 
money in R&D, but coal is flat funded.
    Quickly, do you believe that we will have to continue to 
use coal in our future and need to find ways to decarbonize 
coal?
    Secretary Chu. Yes.

                                HYDROGEN

    Senator Dorgan. Okay. Well, we'll talk more about that. Let 
me ask you about hydrogen. You have essentially zeroed out the 
hydrogen program. You've moved a portion of it into a different 
direction, but there are about 190 ongoing hydrogen projects 
that are unfunded.
    We've got about 500 jobs, 140 at universities, 150 at 
national laboratories, 235 in industry, that have been working 
on hydrogen. And I agree that hydrogen is not near term. But I 
also agree if someone is going to look at things that are not 
near term, but are essential in the longer term, who but the 
Department of Energy should do that?
    I'm stunned that the budget essentially just moves away 
from hydrogen fuel cell research and stops projects in the 
middle of these projects. I don't understand just deciding to 
take projects that are half completed and say, ``You know what? 
We've decided that we're not going to do those projects 
anymore.'' I'm a big fan of hydrogen in fuel cells, and I 
believe that they are going to be part of our future. I agree 
it's not near term, but I agree also that the Energy Department 
has a significant role in continuing this research, your 
response?
    Secretary Chu. Well, this was a tough call. I think it was 
centered mostly on saying that hydrogen for vehicles is not 
near term, and that we wanted to prioritize to be investing 
more in things like advanced batteries, something that I could 
see in the next 10, 15 years could actually be adopted on a 
significant mass-deployment scale.
    Hydrogen stationary fuel cells I think we will continue 
funding. There are real issues that I have with transportation 
vehicles. The most problematic, in my opinion, is we still have 
not figured out how to store hydrogen in a compact form. So 
while we can be funding more basic research and looking for 
ways to do that, that is something of real significance.
    The other is the infrastructure. We would have to create a 
totally new infrastructure in order to have the hydrogen 
vehicles be fueled. Not insignificant is the fact that the 
hydrogen, if we were to deploy this within the next 10 years, 
would come out of reforming natural gas, and it's a 
questionable call as to whether we want to be using the 
reforming of natural gas.
    And so there are many issues. At a more basic research 
level, I think there have been advances in fuel cells, and we 
want to push on more radical approaches to these things. But I 
think stationary hydrogen is going to be, in my opinion, the 
first application.
    Senator Dorgan. Well, in North Dakota, we're actually using 
wind power to produce hydrogen from water, separating hydrogen 
from--well, at any rate, my point is that I think the 
Department's made a significant mistake here. And I, for one, 
am not interested in shutting down these research projects, and 
I'm going to do everything we can to continue them.
    We're only looking at near term, the next 5 to 15 years, 
but when you come around talking about cap and trade and 
climate change, you're going to talk about 2040 and 2060, 2070. 
So I really think this is an important area of research.
    President Bush, Senator Bennett, myself, so many others 
have been very involved in this, and to see these contracts 
shut down in the middle of the contract on very important 
research, I think is not a smart thing to do. So we'll have 
more to discuss about that.

                         BLUE RIBBON COMMISSION

    Quickly, what is the status of the development of the 
Nuclear Waste Blue Ribbon Commission? You recommend shutting 
down Yucca Mountain as a storage site. So the question is 
what's the development of the Commission, the status? What's 
your evaluation of what the Energy Committee is doing? In the 
energy authorizing committee, we have proposed something of 
that sort. Are you considering recycling spent nuclear fuel to 
reduce the volume? So give us your thoughts about what is 
behind shutting down Yucca Mountain.
    Secretary Chu. There's a first draft of names that are 
beginning to be circulated among the White House personnel 
people. We will be circulating them among Congress also for 
comment. The authorization committees, Chairman Bingaman and 
his committee, is I think--we're essentially in sync, in terms 
of trying to develop a very measured, intelligent, deep group 
of people that can actually step back and say that there are 
options available to us today, and looking down in our crystal 
ball and tea leaves 50 years from now, 20, 50 years from now, 
we can see other options.
    So now is a good opportunity to say--to charge the 
committee. There are options. I personally feel that if we do 
it right, we can develop ways of processing nuclear fuel to 
recover much more of the inherent energy value of that stuff, 
perhaps--through recycling, but we need to develop processes 
that are economically viable and proliferation resistant.
    So if that's true, and I think there's a reasonably good 
chance we can do this in the coming decades, then we would want 
to have two different types of storage--an interim type of 
storage, where you can then either get back the access, 
reprocess the fuel. We also want to be investing in types of 
reactors that can help burn down this fuel, and especially 
the--waste, so we can greatly reduce the waste.
    Now, having--after you've done all that, then there comes a 
point where you say you might not want to have access to, after 
you've burned down a considerable amount of the energy value. 
So then a permanent disposition might be called for. But these 
are things that the Blue Ribbon Panel should be discussing. And 
it's the hope that with their advice to both the administration 
and the Congress, we can formulate a path forward that I think 
could be much better than the one we're currently on.
    Senator Dorgan. I'm going to reserve the remainder of my 
questions until the end. Senator Bennett?

                             NUCLEAR POWER

    Senator Bennett. Thank you, Mr. Chairman. Mr. Secretary, 
let's continue this conversation about nuclear power. You've 
testified several times, and again today, in your support of 
nuclear power. And I'm delighted with that, because I'm a 
strong proponent myself. The budget fails to demonstrate any 
urgency, in my view, particularly deploying state-of-the-art 
reactor technology. And the rest of the world is investing in 
new reactors. Russia, France, India, all beginning to line up 
countries to sell their reactor technologies.
    Now, the United States is clearly the leader in terms of 
safety. There have never been lives lost. There's never been a 
problem with the American reactors. So that raises the question 
of why we are not the export leader in this business, but these 
other countries are.
    So would you be willing to support additional funding for 
the NP2010 program if it improved U.S. export competitiveness 
and accelerated the deployment of new reactors domestically? 
That would, I believe, create thousands of new jobs in the 
United States. Is that something that you could be supportive 
of, if this subcommittee moved in that direction?
    Secretary Chu. Well, in terms of NP2010, there were two 
reactors that we initially were supporting, the AP1000, the 
Westinghouse reactor, and the GE reactor. It is my 
understanding that the orders for the GE reactor have shifted, 
and it's not clear. And so while that reactor is still going 
forward in a much different pace--and so a decision was made 
until we get strong signs from General Electric that they were 
going to go ahead and push this because of the recession, 
because of a shifting of orders, for example, from the GE 
reactor to the Westinghouse reactor, the support of the 
licensing of that reactor didn't seem to be as high a priority.
    So I do want very much to restart the nuclear industry. 
We're in a final review of a number of proposals for the loan 
guarantees. And so that's something that has a very high 
priority with me. This specific reactor, the GE reactor, and 
the extension of 2010 will really depend, in large part, on 
what General Electric--how aggressively they want to move 
forward on it as well.

                            LOAN GUARANTEES

    Senator Bennett. I see. Let's talk about the loan 
guarantees for a minute. In the bill that left the Senate, 
there was a very hefty increase in loan guarantees. It did not 
survive with the conversations in the conference. Those of us--
well, I won't say those--I was subjected to some fairly heavy 
criticism on the part of people who said, ``Well, the loan 
guarantees should not include nuclear. The loan guarantees 
should be entirely for wind and solar and that sort of thing, 
and you shouldn't include nuclear in there.''
    The Department's issued five solicitations under the Loan 
Guarantee Program, and in four of the five, demand vastly 
exceeded the available supply. Now, would you be open to having 
the Congress change the law so that you could shift from one 
pattern to the other, if there's one that's undersubscribed, 
and make that money available to others? And do you still 
support the idea that under the loan guarantees, nuclear has to 
be included as renewable, in the sense that we are defining as 
renewable something that is not emitting carbon?
    Secretary Chu. I absolutely support the idea that within 
the loan guarantees, restarting the nuclear industry should be 
supported. Right now, the $18.5 billion can probably help start 
three of their four applications. We're looking as to whether 
there can be some cost-sharing with non-Federal loan guarantees 
from abroad in order to fund four. I think that's a start. I 
personally would like to see a bigger start.
    Senator Bennett. Well, the request for $93 billion for the 
$18.5, so there's obviously a great deal of interest in it. And 
my concern is that if you have other areas under loan 
guarantees where the requests are below the amount available, 
that you be given the authority to shift money from that and 
make it available to nuclear. Is that something you would be 
supportive of?
    Secretary Chu. I think in general, philosophically, 
absolutely yes. But I think to balance that, there is a fear, 
because the cost of nuclear is so high, that there is a fear 
that if you were allowed to shift the money, that it could 
easily gobble up a lot of the things of the lower cost 
renewable energy projects. So there should be a balance there, 
but having the flexibility to make those decisions, I would 
welcome.
    Senator Bennett. Okay, one last question. We've talked 
about the stimulus package and the amount of money that's 
available. Can you give us a path as to how quickly some of 
this money can be moved out? It has not moved as rapidly as 
many people thought that it should. And are those people just--
their expectations are too high, and you're moving the best you 
can? Or have you run into problems? Or is there a holdup where 
we can be helpful? Can you give us the timeline? Just give us 
an overall view of what's happening with all of the money that 
got appropriated to----
    Secretary Chu. I think the progress in the loan guarantees 
has been actually very good since when the new administration 
took over. When I took over initially, I was told that the 
first loan, which was authorized by----
    Senator Bennett. Not just loan guarantees, but generally, 
the President--you have $38.7 billion appropriated, and you 
spent 1 percent of that.
    Secretary Chu. Okay. That's right. So in many of the 
programs we're doing, we're on target. We have a schedule that 
we want to have allocated 70 percent of that Recovery Act money 
by Labor Day. There's an issue here because in many of the 
things that we do, we request for proposals. We have to review 
the proposals, and then we have to make decisions.
    So in order to do this, there's going to be a massive 
review this summer of many of those programs. So we've gotten 
clearance from OMB, apportionment of many of these things. And 
so the allocations, we hope a lot of them can be made by this 
Labor Day. So, so far, there has been $4 billion obligated to 
date, about 10 percent.
    Senator Bennett. About 10 percent. Okay. So, Labor Day is 
an updated timeline when you will have, what, 70 percent of it 
spent?
    Secretary Chu. Well, by spent, what we're saying----
    Senator Bennett. Or obligated?
    Secretary Chu. Yes, we're trying to get to that obligation 
period by that time. That's correct.
    Senator Bennett. By Labor Day. And are there any accounts 
that you see that might, in fact, lower the amount you'll have 
to spend in fiscal year 2010 as a result of the normal 
appropriations?
    Secretary Chu. Sorry, I didn't quite get the question.
    Senator Bennett. If you have the backup of stimulus funds 
that you've been unable to spend and then those get spent 
during fiscal year 2010, does that mean there is any fiscal 
year 2010 money that can, in fact, be delayed until fiscal year 
2011 because you simply can't physically spend it?
    Secretary Chu. Right. Well, we're going to be trying to do 
our best to satisfy the statutes of that Economic Recovery, 
which is really to have it essentially obligated--100 percent 
of it obligated by 2010, and a large fraction of it spent. But 
as you know, there--in some of these things that we're doing, 
in order to lay the foundation for a new energy economy, it's 
not as though it's money instantly into supplemental check----

                             RECOVERY FUNDS

    Senator Bennett. Oh, I understand that. But you understand 
the angst that is out there among our constituents about the 
amount of money in total the Federal Government is spending and 
the concern that it may not be spent wisely. And if, as you 
move forward in your pattern to say, ``Okay, this is the proper 
timetable and the proper method of spending stimulus funds,'' 
and you discover that in doing that, it means that you do not 
need as much of the 2010, in terms of--speaking in business 
terms now--actual cash flow. I'm not talking about changing 
your plans or changing your research programs or your targets 
or something.
    But there becomes a physical question of pushing the money 
out the door. And in terms of actual cash flow in 2010, you 
can't prudently do it----
    Secretary Chu. Right.
    Senator Bennett. Would you share with the subcommittee 
those funds that might be pushed onto 2011?
    Secretary Chu. Yes, I could share those concerns. But we 
are looking at novel ways of addressing this. It is a--you're 
quite right to say that this is a Herculean task. It more than 
effectively doubles our budget. And so, for example, I have 
sent a letter out to all the presidents of the major research 
universities, the relevant deans, the presidents, and the 
executive chairs of all the relevant professional societies, to 
say that we're going to have essentially a review-fest over a 
period of one week in Washington, asking them to nominate for 
this summer their best people to help us review these 
proposals. We cannot do this alone with our current staff. And 
so we're looking at things like that in order to get this 
moving.
    Senator Bennett. Okay. Thank you very much.
    Senator Dorgan. Senator Bennett, thank you very much. I 
have just been called by Senator Reed, the majority leader, to 
go to the floor to negotiate an amendment that they're trying 
to clear before they do final on this, in the bill that's now 
pending. So I've asked Senator Murray to chair while I'm gone. 
And let me call on Senator Alexander. We're recognizing 
Senators in order of appearance at the hearing.

                            INNOVATION HUBS

    Senator Alexander. Thank you very much, Mr. Chairman. Mr. 
Secretary, welcome. On May 9, 2008, I made an address at Oak 
Ridge Laboratory about a new Manhattan project for clean energy 
independence, seven grand challenges for the next 5 years: 
plug-in cars and trucks, carbon capture, solar power, nuclear 
waste, advanced biofuels, green buildings, and fusion. So I 
like your hubs. I think that's exactly the way to go about 
these grand challenges.
    I have a question about a relatively small item. In the 
America Competes Act, which you had a role in developing the 
recommendations for, there is a provision for distinguished 
scientists who would have one foot at a university and one foot 
at a national laboratory. It's worked well at Oak Ridge, for 
example, with the University of Tennessee over the last 20 
years.
    There's authorization for up to 100, was the idea, to be 
phased in over a period of time, and there's the authorization 
for $30 million of spending, none of which is funded yet in 
this budget. I just want to call that to your attention in case 
it does get funded to suggest that moving ahead with those at 
the rate of four or five a year might be one way to advance 
these hubs, as you're looking to attract very talented people 
to focus their attention on those. Have you noticed this?
    Secretary Chu. Actually, first, let me just say I support 
the idea. I think having intimate collaborations from 
universities and national labs is something I'm very supportive 
of. I would be encouraging--although one doesn't see it 
specifically in a line item of a budget, one is beginning to 
see this in the national labs, and I would be encouraging the 
national labs to grow much stronger relationships with 
surrounding universities. It serves both the university and the 
national labs very well. It brings in a lot of young blood. It 
creates a churn and intellectual excitement.
    So while it doesn't have to necessarily show up in a line 
item, I will be encouraging all the national labs to do just 
that within their programs.
    Senator Alexander. And this authority isn't earmarked to a 
particular university; it's for the Secretary to compete and do 
it in whatever way is right. I would like to explore the 
questions that Senator Dorgan and Senator Bennett raised about 
nuclear power.
    The President, in his inaugural address, talked about power 
from the earth, the wind, and the sun, and that's captured the 
imagination of a lot of people. But it's less than 1\1/2\ 
percent of our electricity today, and if we double it or triple 
it, we still don't have much. And even if we reach the 15 or 20 
percent that some people think we might of renewable power, 
that's probably it, and that still leaves a need for 80 or 85 
baseload power.
    I thought the President's rumored proposal today of capping 
greenhouse gases from tailpipes by a low-carbon fuel standard 
was a good idea. I think that it makes sense because that will 
encourage switching to an existing technology, such as electric 
cars. We have enough--we could plug in, Brookings says, half 
our cars and trucks, without building one new power plant, if 
we do it at night, we have so much unused capacity.
    If we look back at the beginning of the cap-and-trade 
program in 1990 and 1991, we had an existing technology then 
for dealing with the acid rain. We had scrubbers that would 
take care of that. Where I'm going is, as we move along in the 
greenhouse gas discussion, we probably get next to coal plants, 
which are 40 percent of the carbon. And we don't have an 
existing technology to deal with that, except nuclear power, 
and with a limited amount of experience with burying carbon 
underground.
    So why wouldn't we be as aggressive about expanding nuclear 
power and doubling or tripling research in Manhattan project to 
find a way to get rid of the carbon in existing coal plants as 
we are with wind and solar and other so-called renewable 
powers? They're not baseload powers. And isn't it true we have 
to have some new source of clean baseload power? Why not just 
put a plan in to build 100 new nuclear powerplants in the next 
20 years as a start toward that and double or triple research 
to take carbon from existing coal plants?
    Secretary Chu. Well, as enthusiastic as I am about nuclear 
power, that number, 100, would be a lot. It would be a huge 
challenge to our nuclear industry. I think I've repeatedly gone 
on record as saying, as you well know, that this 
administration, this Department, the hopefully soon-to-be 
confirmed members of my team are all enthusiastic about it. 
They say it is a necessary part of our baseload power.
    I agree with you, if you're going to go above 15, 20, 25 
percent renewables, there are real issues having to do with the 
transmission and distribution system, having to do with 
storage. The storage problem is especially an unsolved problem, 
but there are options, and so we'll be looking at, for example, 
pumped hydro, where it's appropriate in certain regions.
    But I reiterate the fact that we're blessed with a lot of 
coal, and although we do not have today the technologies that 
would make capture and sequestration of coal economically 
competitive, I think there's a good chance that we can get 
there. And so I'd prefer to take a different stand and say 
let's push all of these things as hard as we can.
    The nuclear industry, if you look at the capacity of their 
ability to build reactors, it's not there today, and so while 
we want to move aggressively ahead on that, I think we still 
have to try to move aggressively as we can on developing the 
technologies for capture and sequestration.
    Senator Murray [presiding]. Thank you, Senator Alexander.
    Senator Alexander. Thank you, Madam Chairman.
    Senator Murray. We'll move to Senator Tester.

                         LOAN GUARANTEE PROGRAM

    Senator Tester. Yes, thank you, Madam Chair, and thank you 
for being here, Secretary Chu. A couple of things, going back 
to some previous questions, I certainly appreciate the 
situation you're in and that there is a sizable sum of money 
available to you to send out. But I also appreciate the fact 
that you're taking the time to make sure we get the results 
from this. It's just not money spent for the sake of spending 
money. And I think there's a real urgency in generation and 
transmission in this country, as the questions before me have 
pointed out.
    I want to go back a little bit to the Loan Guarantee 
Program. You talked about a massive review--I don't know if it 
was of that program or not. But just can you tell me where we 
are as far as the decisionmaking process of that Loan Guarantee 
Program, and what is the timeframe for getting some of the loan 
guarantees out the door?
    Secretary Chu. Okay, so we've made a provisional grant to 
one company. That means that they have to find funding for the 
current statute for the 20 percent. This is middle May. I think 
by the end of this month, we'll be announcing a number of 
others. We've greatly accelerated all the review processes and 
how we do it, and we're doing many things in parallel now, 
something that the Department is not used to.
    And so the loan guarantees essentially are being 
accelerated by about a factor of 5, maybe closer to 10. So this 
is a very significant focus on making sure that these things 
are reviewed, reviewed adequately, but very quickly.
    Senator Tester. Okay. So you're anticipating some 
announcements--because we are in the middle of May----
    Secretary Chu. Right.
    Senator Tester [continuing]. Any day?
    Secretary Chu. Certainly within the next couple weeks to a 
month, yes.

                              WIND ENERGY

    Senator Tester. Okay, all right. We have great wind 
resources, particularly in the eastern part of Montana. And 
what has traditionally happened over the last 4 or 5 years is 
they've built a lot of towers in a fairly small area for 
purposes of maintenance and construction, cranes, all that 
stuff. It looks to me like the best benefit you can get out of 
wind is if you decentralize it, if you move it around for 
intermittency purposes. The wind's blowing somewhere in eastern 
Montana every day, all the time, and the issue is the grid.
    Do you ever put forth policies or put forth direction to 
electrical generation companies to encourage them, or is there 
anything we can do to encourage that, or is that even a good 
idea? I'm talking about decentralization of wind to reduce 
intermittency and reduce the need for--go ahead.
    Secretary Chu. No, that is a very good idea. In fact, a 
number of Cabinet-level people have been meeting on an every-
other-week basis. The principals--meet--this is Interior, Ag, 
Energy, CEQ, a number of stakeholders--to try to develop a 
coherent plan where the energy resources, both solar and wind, 
where are the places where it would not be--we have to be very 
sensitive to environmental concern and danger species, things 
like that, and trying to now develop this--FERC is also, of 
course, part of this. And we're trying to then develop this and 
start to work with the private sector.
    Senator Tester. So you have the ability to give some 
direction?
    Secretary Chu. Well, we're----
    Senator Tester. Or we need to do it at this level?
    Secretary Chu. Well, we are trying to develop some plan 
that gets buy-in from the private sector.
    Senator Tester. Okay. That's the best.
    Secretary Chu. The meetings have been going on for several 
months.

                      CO2 SEQUESTRATION

    Senator Tester. A few weeks ago, this subcommittee had a 
hearing on beneficial use of CO2. We heard some 
pretty encouraging things about algae. One that was 
particularly encouraging to me was cement, making cement, not 
having to separate the flue gas. It sounded to me like it was 
tricked out and ready to go.
    Two questions, No. 1, is that kind of specialty use of 
CO2 something that you see as viable and is it 
something that can happen? And then the follow-up question is, 
is the beneficial reuse of CO2, is it being limited 
by our study of carbon sequestration and storage?
    Secretary Chu. We are certainly looking into those things--
the algae converted CO2 into lipids that can be used 
for transportation fuel and cement. The verdict is not in 
whether these processes work but if they could go to a scale 
necessary to be significant, and so we're looking very hard 
into this. I do know other countries also are looking into--for 
example, I just had a discussion with some representatives of 
China. They're keen on seeing whether this can actually work.
    But again, we're in the process of trying to study whether 
it can really go to scale or whether it will be a small, more 
boutique type of thing. Cement especially is something that 
goes in several stages. There are various grades of cement and 
long before you can actually get into a structural cement there 
are many issues having to do with structural integrity. The 
economic viability is something--it's--but these are fairly new 
ideas, and so we are very interested in looking and seeing if 
they can really work.
    Senator Tester. Do you think the budget's adequate enough 
to deal with the CO2 issue, generally speaking, both 
as beneficial use and as storage? Is this an adequate budget to 
deal with that?
    Secretary Chu. I believe it is. I think we're upping, 
actually, the funding in algae, and cement, there are a couple 
of companies looking at this, in terms of supporting that with 
loan guarantees.
    Senator Murray. Thank you, Senator Tester. Senator 
Feinstein.

                           DESERT PROTECTION

    Senator Feinstein. Thank you very much, Madam Chairman. 
Good morning, Secretary. It's good to see you here. I've tried 
to obtain an appointment with you. So far, I've not been able, 
so I'm going to take this opportunity to express a concern 
publicly that I would have expressed privately, had I had the 
opportunity.
    You may not know this, but I authored the Desert Protection 
Act in southern California. We created two new national parks, 
Joshua Tree and Death Valley, and the Mojave Preserve. Since 
that time, for about the past 7 years, we've been trying to buy 
railroad inholdings to put them into conservation and have in 
effect bought about 700,000 acres in a very unique public-
private partnership. The private sectors contributed $40 
million, and we, about $17 million, to be able to do that.
    So it was much to my consternation that I was suddenly told 
that a lot of large solar facilities were going on the land 
that we had just purchased with a lot of private money to 
conserve. So I went down to the desert and brought the 
companies involved and took a look.
    And here's what I found, that I saw seven projects. They 
totaled nearly 60 square miles, 60 square miles. One was 9.3 
square miles. One was 7.03 square miles. One, 15 miles square, 
that's BrightSource, Iberdrola, 3.09, the second Iberdrola, 
another 3.09, PG&E, 6.56, and Solal, 6.25, and many of them in 
this land that is due for conservation and that had been 
purchased for the purpose of conservation.
    Then I began to look, and I talked to Southern California 
Edison, ``What's your largest solar project?'' 50 megawatts. 
And I see here, we've got 914, 815 megawatts, 500, 500, 500, 
800, 600, huge projects. And I asked how was this done? Well, 
the national topography of the land is leveled out. The sand is 
removed. A gravel surface is put in. The solar troughs are 
centered. You need a large steam plant, and you need very large 
transmission lines.
    The question comes, for me, having tried very hard over 16 
years to protect this area of the desert, now to see it all in 
the main going for a huge number--now, I'm only talking about 7 
out of 65 projects for the area. Those were the only ones I 
saw. But the ones I saw were 60 square miles' worth of solar 
troughs, huge steam plants and fences that will go around it. 
Right in the middle of a desert where the desert tortoise has 
some habitat, where there are other problems--bighorn sheep, 
Indian petroglyphs, and so on--and we've been able to clean up 
this desert over time.
    The question I have is should we not cap the size of these 
things? The largest that I know of is in Kramer Junction. Two 
projects, one 160 megawatts and one 150. Each one is about 2 
square miles. Those are the largest I know of anywhere in the 
United States. And now we're talking about one of 15 square 
miles. Should we not cap the size of these?
    Secretary Chu. Well, I certainly would be willing to--
first, I'm a little bit surprised if you asked to see me and my 
staff said no.
    Senator Feinstein. Well, we just haven't gotten a response. 
That's sort of the way it's done. You just don't hear.
    Secretary Chu. Oh.
    Senator Feinstein. But anyway.
    Secretary Chu. I'm still surprised. You actually have my 
private number.
    Senator Feinstein. Well, I should call you at home, then.
    Secretary Chu. But I'd certainly be willing to talk to you 
about this. These are sensitive issues and we have to think 
hard about them. I don't know--I was actually just informed 
only a few days ago about this concern and I'd certainly be 
willing to look into it.
    I think this is one of those very delicate issues, as I was 
saying to Senator Tester, as we are developing a plan moving 
forward in conjunction with the other Secretaries, one of the 
issues is the sensitivity to habitats of endangered species 
that we're looking at, and we're trying to make sure that we 
fold all those concerns into where there would be good sites 
for solar and wind.
    Senator Feinstein. My time is up. Let me say one more 
thing. In my State, I have 47,000 abandoned mines. People came 
in, they mined, they took the stuff they wanted and they walked 
away from the mines. Solar technology is going to change. In 
Daggett, I've looked at some photovoltaics and solar troughs. 
They walked away from them. They left the steam engine there, 
steam plant there. This has to be considered as well.
    Everything right now is how you can do it the cheapest 
possible way you can. Huge is better. But I've got to tell you, 
I'm going to fight for this land to be protected. And I think 
that size is a factor, and you just can't come in and build 15 
miles square facilities with huge steam plants. We're willing 
to do our share. I am. I understand the desert is a good place 
for it. But the sky's not the limit, Mr. Secretary, and that's 
what I want to say. Thank you, Madam Chairman.

                             WASTE CLEANUP

    Senator Murray. Thank you, Senator Feinstein. Mr. 
Secretary, thank you. You and I have spoken on several 
occasions about the legal and moral obligation for the Federal 
Government to clean up the waste that was left behind from 
World War II and the cold war. We've talked about it prior to 
your confirmation, at the Budget Committee hearing, and again 
after the release of the 2010 budget proposal.
    My position is really clear, and the administration is 
going to have to expect it to remain consistent, because that's 
what I want for these budgets. I want budgets that clearly meet 
the obligations we have to the Nation and the States and the 
communities that are home to those cleanup sites. And I want 
budgets that consistently make progress toward the goal of 
cleaning up that waste.
    The funding highs and lows that we see just don't get us 
there, and unfortunately, that's what I see in the EM budget 
we've been presented with. Let me talk about the highs. In the 
Office of River Protection, it's good to see an increase for 
the work at the tank farm. We have seen years and years of 
pushing off those infrastructure needs, and there's a lot of 
work that needs to be done there. You're putting your focus 
back on that work, and I do appreciate that. I expect that we 
can remain consistent, and we'll look forward to that as the 
new base level of funding for those tanks. That's really 
important.
    However, the same effort isn't evident with Richland 
Operations, where there's a reduction in funding below the 
fiscal year 2009 and fiscal year 2008 appropriated amounts. 
That reduction does not represent a consistent effort for 
stable and compliant budgets. We all have to remember that the 
economic recovery funds were meant to make up for lost time and 
to create good-paying jobs, not to make amends for this year.
    The River Corridor Closure Project is up; however, the 
Central Plateau is down. Reducing the active cleanup footprint 
at the site is a really large task that requires consistent 
budgets to fund the effort. So I encourage you to keep that in 
mind when you're planning for next year's budget so we don't 
get ourselves back into this position again.
    As you know, Hanford is not going to be cleaned up in 5 or 
10 years. It's a large project, massive in size, and we need to 
manage it thoughtfully and consistently with that long-term 
mission in mind. And that's why I am always saying we need 
stable and consistent budget, so we can get the job done 
safely, No. 1, and successfully.
    I also wanted to just quickly mention to you the Hammer 
Facility that is on site at Hanford. The Hammer Facility offers 
incredibly wonderful training for people who take on the very, 
very dangerous work of cleanup. And I'm hopeful that when you 
do come out to visit the Hanford site, that you'll get the 
opportunity to stop by and see Hammer, see what they're doing, 
to help promote a safe working environment at a very, very 
challenging place.
    I'm still looking forward to your visit at some point in 
the near future, where you can see progress on the site, but 
also, some of the worker safety training going on at Hammer and 
at PNNL and how everything works together towards cleanup.
    I do have a number of detailed questions for you on support 
for Hammer and the B reactor. I'll submit those for the record. 
But I do have a question for you while you're here, Mr. 
Secretary. I do want to say that I'm pleased at the overall 
increase for energy efficiency and renewable energy. We've got 
to move forward on a clean energy economy. And I think that 
does help us keep on the path.
    Now that you have spent some time at the Department, I'm 
looking forward to hearing an update on the Water Power 
Program. As you know, that program got $40 million in 2009, and 
the President is now requesting a 25 percent reduction, which I 
am very concerned about. I think we have to have a very strong 
continued investment in existing hydro facilities that will 
allow us to use those to supplement the more unpredictable 
sources, like wind or solar. And I think we have to increase 
our work to develop new marine and hydrokinetic technologies, 
as well, that you and I have talked about before.

                              WATER POWER

    So with my less than a minute left could you talk to me a 
little bit about your vision for the Water Power Program.
    Secretary Chu. I think, first, very briefly, I am very 
committed to continuing the cleanup as aggressively as we can 
and looking for better ways of doing that. It's not only the 
money, but it's also the way it's invested and funded. And so a 
lot of time is now being spent in reviewing how we deal with 
the contractors, making sure that they do the job in a timely 
manner.
    In terms of the water projects, it's too late to start this 
in 2010, but in the 2011 budget, I'm a big advocate for looking 
at ways of being, let me just say friendly to the fish, but 
allow us to continue hydropower, but also to look at the 
possibility of actually having some pumped hydro, small amounts 
of sources, so that we can actually couple the renewable energy 
better. And so we're going to be looking very hard at that.
    Senator Murray. Okay. I look forward to working with you on 
that. I think it's extremely important. And I appreciate your 
response. Senator Cochran.

                      STRATEGIC PETROLEUM RESERVE

    Senator Cochran. Mr. Secretary, welcome to the 
subcommittee. We thank you for your cooperation and your 
service as Secretary, a very important position. In the budget 
request for the Strategic Petroleum Reserve, roughly $50 
million is included and proposed for the purchase of a new 
cavern to replace an existing storage cavern that was said to 
pose an extreme environmental risk. And this is for storage of 
strategic petroleum reserve.
    There are salt domes in my State of Mississippi which some 
think are ideal sites for the storage of the petroleum reserve. 
Your Assistant Secretary recently testified about legislation 
to increase storage capacity, specifically for the strategic 
petroleum reserve.
    I'm curious to know what your thoughts are about choosing 
caverns that some say are not environmentally appropriate for 
storage, rather than looking into the possibility of salt domes 
that are coincidentally located in southern Mississippi. I'm 
just curious to know if this has reached your level for 
attention and consideration.
    Secretary Chu. Well, my understanding is that one cavern, 
which I believe is the salt cavern--it wasn't understood that 
the thickness of the salt was, in one section of it, thin 
enough that it could open up the possibility of a breach and 
can actually--the petroleum could leak into the environment.
    And so that was discovered, in my understanding, last year, 
year and a half. And so once it was discovered, it was decided 
that that posed an environmental risk and we should go out and 
purchase some property to put it in a place where the envelope, 
if you will, would be less likely to be breached. And so that's 
what we're in the process of doing, but salt caverns are 
actually used for that, as you well know.
    Senator Cochran. Right. Well, I was just curious to know 
whether that reached your level for your personal attention. I 
don't have any fixed views about which caverns are the best or 
not the best, but we certainly want to be sure that they are 
safe in terms of environmental consequences, and certainly in 
respect to possible damage to people who live in the area.
    Funding, incidentally for the strategic petroleum reserve 
included $35 million for a site near Richton, Mississippi, 
contingent on a report issued by the Department within 45 days. 
My staff has contacted the Department about the report, and 
we're just curious to know what the status of that report is, 
if you know.
    Secretary Chu. I don't know. I could get back to you on 
that and give you the details.
    Senator Cochran. We would appreciate that, and we would 
like to be kept in the loop, as long as you have active 
consideration of Mississippi sites. Or I know in Louisiana, 
they have some salt caverns there as well. But it's of 
importance. We want to be a positive contributor to the solving 
of our energy problems, and we think that there are some 
caverns that possibly could be suitable, and we'd like to 
know--there was a report, I think, contemplated at one time to 
describe and define this, so the general public would have some 
better ideas of what's going on. Rumors get started, and I 
would like to know what the facts are so I can pass that on to 
my constituents. If you could look into that, I would 
appreciate it very much.
    Secretary Chu. Sure, I'd be delighted to.
    Senator Cochran. Thank you. Thank you, Madam Chairman. 
Sorry, Mr. Chairman.

                               GEOTHERMAL

    Senator Tester. Oh, that's entirely all right. I'll ask a 
few questions here, waiting for Senator Reed to go here. Real 
quick, do you think that there's any future as far as 
geothermal goes in relation to baseload power, or is it 
economically not going to happen?
    Secretary Chu. I think there is a real potential, 
especially enhanced geothermal. But we're looking--geothermal 
right now is on .3 percent of our electricity generation 
capacity in the United States.
    Senator Tester. But we have incredible resource.
    Secretary Chu. We have incredible resource. It's mostly--my 
understanding, it's mostly in the ability to do enhanced 
geothermal, meaning that you pump in water or carbon dioxide 
that uses the heat transfer fluid. We know how to fracture rock 
much better than we did before, and so this is a possibility.
    We are going to be investing in research to see whether 
enhanced geothermal can actually be viable. If it is viable, 
there is a very large resource.
    Senator Tester. How many years out do you think it is, 
before the first viability?
    Secretary Chu. I'm trying to think of the briefing, but 
these things are issues where you're going to--it's, again, 
there's--it takes time to drill. It takes time to test it. Ten 
years. I don't know.
    Senator Tester. Okay. Senator Reed.

                       WIND AND GRID INVESTMENTS

    Senator Reed. Thank you very much. Mr. Secretary, thank you 
for joining us today. I know you are aware that my State of 
Rhode Island is aggressively trying to deploy wind-powered 
facilities off its coast in State waters near Block Island and 
in Federal waters further out. This is not only going to 
provide us with, we hope, renewable energy resources, but also 
provide a stimulus to our manufacturing sector, producing the 
blades to turbines and other equipment.
    One of the concerns we have is that the investments that 
you are leading in terms of the grid might focus the attention 
away from these projects along the east coast and more toward 
the center of the country. And I would just ask you to sort of 
ask us how these grid improvements can help and not hinder the 
development of these wind projects. And it's not just Rhode 
Island. It's Delaware. It's all up and down the--Virginia, all 
up and down the coast, this sector.
    Secretary Chu. Well, you're raising a very important point. 
The Atlantic Coast has a lot of wind resources, very close to 
population centers. And we are--certainly this is part of us, 
as we get out feet wet, so to speak, in finding out how to 
develop the wind resources.
    I think it's important to actually develop them in both 
places. The more diverse the set of wind resources, not only in 
Montana, but all over the United States, the better we have of 
actually becoming more base load. So to have wind resources off 
the shallow Atlantic Coast and having it in the Northern 
Midwest, they're very important.
    So in talking to power distribution companies, utility 
companies, it's not clear to them what the best economic 
investment is either. So we're trying to work through this. The 
issue with offshore is that for shallow offshore, it's about a 
factor of two more expensive initial investment. Even more so--
perhaps a factor of three or more--in the maintenance, and so 
far, the maintenance is higher than expected in the European 
experience. And so we are trying to work through all of these 
things. Hopefully within several years, we can get the wind 
turbines so that the gear boxes, the blades, are much more 
robust.
    But so these are all issues. Going offshore actually 
complicates that.
    Senator Reed. Yes, indeed. I think, though, that--and I 
don't want to suggest a response, but it seems that there 
should be a very explicit recognition of these offshore efforts 
and coordination as you invest in the grid. It would help 
either inadvertently or directly see huge investments, which 
make it even more difficult to bring this power----
    Secretary Chu. No, I agree with you. I think it should be a 
balanced view, and how to develop the renewable resources at 
large in the United States in the most balanced way. And in our 
little group of secretaries and other administrators, this is 
very much on the table, the balance between Atlantic offshore 
and Midwest, for example.
    Senator Reed. And principally FERC and the Department of 
the Interior will have the principal roles of the siting, et 
cetera. But I presume the Department of Energy will be an 
active participant, from your comments.
    Secretary Chu. Yes. But you said it correctly FERC and 
Interior will have the major roles in deciding.

                             WEATHERIZATION

    Senator Reed. Let me--I have at this time, one final topic. 
And that is thanks to the efforts of Chairman Dorgan 
particularly, there's been an unprecedented investment in 
weatherization in the Recovery Act. And then the 2009 
appropriations bill has $450 million to complement the roughly 
$5 billion in the Recovery Act. But the 2010 budget has only 
$220 million for weatherization. Now, I understand some of that 
is because of a big spike up, and you're coming down. But there 
is a concern that we're ramping up this capacity of 
weatherization. We're getting people out there, particularly in 
the context of recovery, those are good jobs, and then we're 
going to see the funding streams diminish rapidly, leaving us 
with capacity and people, but--and still with demand.
    So I wonder if you could just give us the notion of what's 
your long-term strategy for weatherization, Dr. Chu.
    Secretary Chu. Yes, Senator, you were actually raising a 
very good point. Because in the weatherization, roughly $10 
billion is, in the Recovery Act, spread around several 
agencies. Part of that is actually building a workforce that 
can weatherize, and after 2 years or 2\1/2\ years, what do you 
do with this workforce?
    So I think what we are very concerned about, in trying to 
design self-sustained programs beyond that. Let me give you one 
example. Secretary Donovan and I are looking for ways in which, 
when properties change hands, when you buy a home, that you can 
have financing, additional financing, say an extra $10,000, 
$15,000 that's part of your mortgage that, if done right, that 
financing could actually decrease the cost of running your 
house, because the money you save in lower utility bills will 
be more than compensative for the additional little bit of 
mortgage.
    Now, when you sell your property, it's--okay, the 
investments are there. And so that helps overcome the initial 
hurdle of capital that is very important. This weatherization 
could cost $10,000, $15,000 for middle-class homes. It also 
gets the middle class into this.
    We're also looking at programs where banks could be 
encouraged to again for the affordability of the house, ask 
that, in addition to a termite inspection, they ask for the 
utility bills from the gas and heat. And in that section of the 
country, this is the spread of utility bills per square foot 
for average house. So just like a refrigerator label, this is 
the spread--the home you're thinking of buying is here or here.
    This does--first, no taxpayer money. Very little 
transaction cost, but it motivates several things. You get a 
more informed consumer. You actually give incentive to the 
current homeowner to weatherize, to increase the resale value 
of the home. And you actually--then there's an incentive. It 
also helps the new home builders who are reluctant to put in 
energy efficiency. One can predict the energy efficiency of 
those new homes, and they look much better. And so you 
stimulate in many ways, just by the simple transaction that 
seems to me logical, in the sense that what a bank really cares 
about is the affordability of the home. It includes the taxes. 
It includes the mortgage rate. It includes the utility bills.
    So there are things like that we're looking to do--and 
revolving funds yet another one, so that we actually get this, 
1 million or 2 million homes is just the beginning. We need to 
get this self sustaining in a very deep way. So these are some 
of the programs we're thinking of piloting and testing.
    Senator Reed. Thanks very much, Mr. Secretary. Thank you, 
Mr. Chairman.
    Senator Tester. Thank you.

                          HYDROGEN FUEL CELLS

    Senator Dorgan [presiding]. Senator Reed, thank you very 
much. Mr. Secretary, again, I regret that I was called over to 
the Capitol, but I appreciate your answering the questions of 
my colleagues. Let me go back to the issue of hydrogen. I want 
to ask a number of questions then we will let you be on your 
way.
    The hydrogen fuel cell issue has been a part of the 
Department of Energy's portfolio for well over a decade now. In 
2006, the Department of Energy developed and released the 
hydrogen posture plan. It laid out a 15-year strategy for 
hydrogen and fuel cell research, development, demonstration, 
and deployment.
    Since about 2001, roughly $1.5 billion has been invested by 
the Federal Government in hydrogen and fuel cells, and industry 
and the States are estimated to have spent somewhere in excess 
of $4 billion. My understanding, from the experts who know, is 
that these programs have met their cost and their technical 
goals. Research has kept pace with key milestones established 
in the hydrogen posture plan.
    So, again, I don't understand. Let me be more specific. Do 
you come to us saying you want to shut down these research 
projects in the middle of the research? Is that what the budget 
is asking us to do?
    Secretary Chu. Well, it is a shifting of priorities. I 
would be very happy to talk to you about this and discuss this. 
But certainly it was more the intent of the 2000--the concern 
in the 2010 budget was focused more on the transportation 
sector and whether hydrogen cars could become a reality in 
let's say 20 years, and whether--or do we see it further out, 
and whether we should be investing these resources in, for 
example, much more efficient internal combustion engines, 
especially, from my point of view, diesels, since the new 
advances in diesels allow diesels to now meet California EPA 
standards. They're very clean diesels, and also the plug-in 
vehicles.
    And so in terms of offsetting our imports of foreign oils, 
getting some more oil independence, really getting these things 
in the marketplace, I see those as more likely solutions in the 
next 20 to 30 years.
    Senator Dorgan. I don't disagree with that at all, but do 
you think 50 years from now, that your hope is more efficient 
internal combustion engines, more diesel engines on the road? 
Or is it your hope that perhaps we do things that are 
transformative? For example, continuing to work on hydrogen 
fuel cells that are longer term? And if not the Department of 
Energy to work on this, who?
    And then finally, you didn't quite answer the question. Do 
you really want us to shut down about I think 190 research 
projects that are in the middle of the project? And we just 
say, ``You know what? That was yesterday's money, yesterday's 
Secretary, yesterday's idea. Shut them all down.'' And you 
really want us to do that?
    Secretary Chu. Well, I'd be happy to work with you and look 
at the details of where the programs are and things of that 
nature. And we can work out----
    Senator Dorgan. I'm hoping to help you with the funding for 
these projects, by the way, because I think--well, we may not 
be around in the long term, in the long term, we're all dead. 
But the fact is the near term is not the only thing that's 
important to us. If we're going to be transformative, I think 
you look out beyond 5, 10, and 20 years.

                            WIND DYNAMOMETER

    Let me ask you, Mr. Secretary, about an issue, wind 
dynamometer that is at NREL. My understanding is that we've 
spent a lot of money to test commercial wind turbines at NREL. 
I've been there. I've seen this, big investment in hardware. 
I'm told that the DOE is now pursuing competitive solicitation 
in the private sector for a dynamometer, rather than 
capitalizing on the investment made at NREL. Are we moving away 
from NREL as a center of expertise in this area, and if so, 
why?
    Secretary Chu. Well, actually, I'll confess I don't know 
that part of it. I do know that we have this wind test facility 
at NREL and there's a dynamometer. Getting the private sector 
involved is something I think the Department of Energy is very 
interested in. So I don't know the exact details of that.
    Senator Dorgan. Would you look at that?
    Secretary Chu. Sure.
    Senator Dorgan. And my understanding is, there's some 
interest in the Department of Energy to duplicate that 
investment in the private sector up in the Northeast, and I'd 
be very concerned about that. I mean, I would hope that we 
would continue having NREL as the center of that research.
    Secretary Chu. Oh, well, there's something else--maybe it's 
this, but we are making investments in Boston, but that's a 
wind test facility. That's not----

                                PENSIONS

    Senator Dorgan. That's not what I'm thinking of. And also--
I'm going to say really nice things about you in a moment, but 
I do want to ask these questions. It appears to me there's 
about a $500 million to $1 billion shortfall on the pension 
side.
    Secretary Chu. Yes.
    Senator Dorgan. And I think my colleague from Utah 
mentioned that, and I didn't hear, but maybe you've answered it 
since I----
    Secretary Chu. No, I actually didn't get to that. This is 
of great concern to us. We did scramble around for a lot of the 
money. This is a serious concern. We have a lot of employees 
and former employees, and we have an obligation to them. And so 
there was some last-minute scrambling to find some emergency 
funds. It's not completely covered yet. In the long term, this 
is an obligation the Department of Energy has in the sense that 
we have a liability. I don't think any other agency has this 
liability. We have to figure out a way, for example, of having 
our contractors move toward defined contributions rather than 
defined benefits. Of course, we grandfather in all the people 
that we've had obligation to. We're not talking about that. But 
this overhanging liability is something serious, and because of 
the stock market decrease and because of the new act that says 
it has 80 percent funded, we all of the sudden got these 
shortfalls.
    We're aware of the problem. The long-term fix will probably 
have to be something like evolving toward--as we get in new 
contracts, toward defined contributions.
    Senator Dorgan. Right. So we might have some unfinished 
business on the budget side. I mean, it appears to us it's a 
$500 million to $1 billion that's a shortfall. We'll have to 
continue to work with you on that.

                          RECYCLING SPENT FUEL

    Let me ask if you could just describe again, so that I 
understand, in shorthand under what conditions would you 
consider recycling spent nuclear fuel?
    Secretary Chu. If we could develop proliferation 
resistance, something that would be unlikely that terrorists, 
if they got hold of this material, could actually work with it 
as an example, if it has some soft protection, so it doesn't 
create a stream of separate plutonium or something that's 
easily shielded.
    There's also the economic viability of the processes in 
general. We want to see industry saying there's a path forward 
which that we can really invest in these recycling plans. And 
finally, we need to develop generation IV reactors, high-energy 
neutron spectrum reactors that can burn down this waste.
    I think actually all these things are solvable. It could 
take decades, but I'm certainly interested in looking at it, 
looking at the work. There's--if we extract a lot of the worth 
of the nuclear fuel, this is a clean source of energy, baseload 
energy, and I think the waste problem is solvable, and I think 
there's a likelihood if we do it right and get a bunch of very 
smart people on it, that we can develop these recycling 
methods.
    Senator Dorgan. And I would say, as you look out there, 
decades out on the horizon exist not just this issue, but 
hydrogen as well, in the longer term. You come from a science 
laboratory, are a Nobel Prize winner, a very distinguished 
person and I feel very strongly that the administration has 
solicited the service of someone who's extraordinary. So I'm 
very pleased you're there.
    But I also know where you are. You're in the Department of 
Energy, and that's a great place. You've got some great people 
there. But it's also an area filled with superglue in some 
areas. You just slow everything down then get it all stopped. 
On the issue of loan guarantees and the things that you've come 
to in this agency, an agency that in some areas, it just is 
almost impossible to move. You can observe more movement in a 
glacier than in the Department of Energy on some issues.

                      ACCELERATING LOAN GUARANTEES

    So tell me about what you have discovered and what your 
experience is with respect to getting some of these Loan 
Guarantee Programs moving that were just dead stopped.
    Secretary Chu. Well, we discovered first, that they could 
be increased by a factor of 5, maybe even 10. The only way we 
discovered this is actually, for example, we hired Matt Rogers, 
an outstanding person from McKinsey, and by literally first 
looking at other agencies in the Government, seeing how they do 
their loan programs, and then looking at how we do it, but then 
looking step by step at everything and how you actually go 
about the business in terms of little horror stories here and 
there. They said that the amount of paper required was such 
that they were concerned of any loans below several hundred 
million dollars. They couldn't know how people could afford to 
do this because of the paperwork required, the amount of 
paperwork, 500 to 1,000 pages. We're working very hard to 
reduce that. The target is 50 pages. If you can't get your idea 
out in 50 pages, there's something wrong with it.
    In terms of vetting, many of the times, if you have a dual 
vetting process, if there's a substantial financial investment 
and a bank does some of the things, we can then cooperate and 
do that. The idea that in helping the customers, the potential 
customers, there was a strong sense that you couldn't help any 
particular customer because it would be unfair, it was giving a 
particular advantage to that particular applicant. And so we're 
turning that around and saying there's another way to be fair--
help everyone. It's a novel thought, but we're moving ahead on 
that.
    And so what it really took after the first couple weeks to 
say, okay. The people there need a little help in seeing that 
you can actually move this considerably faster. The idea that 
you go in serially and then you get to the next point and you 
go again, it's like a long relay race. Every time you pass the 
baton, the baton's dropped.
    In actual fact, in industrial project management, in good 
project managements in the Federal Government, that's not done 
that way. You can start many things nearly in parallel. So we 
essentially are looking at every nook and cranny and finding 
that we can actually increase this considerably. And so, again, 
we went from getting the first loan out in 1\1/2\ years to 
getting the first loan out in 58 days from the time I took 
office. And so we are very anxious to see this continue.
    You made a reference to the fact that it is--the friction 
in the Department of Energy is considerable. Our committee is 
more that Newton was right--the body set in motion tends to 
stop the next day, unless you continue to apply pressure.
    But I think the good news is as we work through this and 
actually give people the tools and the ideas of how to do this, 
there is now beginning to be genuine excitement in the career 
people.
    Senator Dorgan. Senator Tester, did you have other 
questions?
    Senator Tester. Yes, I just had one, if I might.
    Senator Dorgan. Let me just--if you might, let me finish 
with my one question, then I'll recognize you for whatever you 
wish.

                           DECARBONIZING COAL

    People are coming to my office with really interesting 
ideas. I had a person in some while ago who has a couple 
hundred scientists working on developing synthetic microbes to 
chew the coal. That's a scientific term, chew the coal, I 
guess. Actually, the synthetic microbes would consume the coal, 
and through the consumption of coal by these microbes, you 
would produce methane, and probably even be able to do that in 
situ, underground.
    I have no idea whether that's just harebrained or 
unbelievably interesting in the next 5 years, 25, or 50 years. 
Someone comes to me with a patent that says, ``I have the 
silver bullet with respect to decarbonizing coal.'' In fact, we 
had a hearing on it, and the guy that comes to the hearing is 
the recognized expert in the country from Stanford on cement 
and concrete. And he takes all of the flue gas from a coal 
plant, and through mineralization, or whatever, produces a 
product that is, he says, harder than concrete and more 
valuable and contains all of the CO2.
    A company comes to me and says, ``We have a process by 
which we separate CO2 with the flue gas, and we get 
nitrogen, hydrogen, and baking soda, and baking soda contains 
all the CO2.'' Those are just three, but there are 
lots of them, lots of people out there doing interesting 
things.
    Give me your assessment. And the reason I'm asking this is 
because I believe, again, we're going to continue to use coal 
in the future. The question is, how effectively and at what 
cost do we decarbonize coal?
    Give me your assessment of those kinds of things and ideas, 
and are you running into them, and do you believe they 
represent great promise for the future?
    Secretary Chu. I'm running into them. I think many of them 
are very interesting, and we are looking at them very hard. I 
think one of the things that you're seeing and the things I'm 
also seeing is there's an unleashing of incredible ingenuity 
and imagination. Not all these things will work. Most of them 
will probably not work, but yet out of that, I think there's a 
great possibility that there would be some really very good 
ideas.
    I'm a big fan of, at least in these early stages, where it 
costs very little to explore these ideas, to explore as many of 
them as possible. Now, this is actually one of the joys of 
being in the job I have. We can look at these wonderful new 
ideas and say, ``Is there going to be merit in this 5, 10, even 
15 years out,'' of all those things, the concrete, the 
conversion of coal, so most of the pollutants and the really 
bad stuff is just left deep underground, and you just sip out 
the natural gas.
    These are potentially very good ideas. What's especially 
nice about some of these ideas, especially the one on the bio 
part, is that's occurring in an area where the science is 
advancing very rapidly. And so the chance of a dramatic 
breakthrough--because we now know how to reprogram these 
microbes in completely new ways, offer real hope.
    Whenever you see the science advancing most rapidly, 
there's more likelihood of getting really big breakthroughs.
    Senator Dorgan. Senator Tester?

                      RENEWABLE PORTFOLIO STANDARD

    Senator Tester. Thank you, Mr. Chairman. I just--there are 
two policies that we're wrestling with right now. One of them 
is putting a value on carbon, and the other one is a renewable 
portfolio standard. Assuming we put a value on carbon, is there 
really a need for a renewable portfolio standard?
    Secretary Chu. I think there is. Because of the way you are 
going to be capping and bringing down the cap in a gradual way, 
that it--and the type of legislation that is being discussed 
actually has to allow the United States to make this transition 
over a period of time. I mean, that's realistic. We just have 
to do that.
    And what our renewable portfolio standard does is it gives 
you a guaranteed market, and so it can tell investors, we need 
to get to let's say 15 or 20 percent. The price signal, if you 
will, from the cap and trade and the decrease in the carbon 
emissions is one way, but that has to be, by its very nature, 
in order for the country to make a transition, a slow gradual 
process, and a renewable electricity or renewable clean energy 
standard, you say, now I've created a market, and so it's a 
draw, so that the investment community can say, ``Yes, I can 
put in my wind turbines or my photovoltaics.'' So they actually 
complemented each other.
    Senator Tester. Okay. Thank you very much.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Dorgan. Well, Mr. Secretary, you are the first 
Cabinet Secretary to use the term joy in describing your work 
in all the years I have served here, but I expect that joy 
reflects your background as someone who ran a science lab, and 
having access to all of the interesting things that are going 
on in these laboratories.
    At this time I would ask the subcommittee members to please 
submit any additional questions they have for the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

             Questions Submitted by Senator Byron L. Dorgan

    Question. The DOE currently has approximately 190 multi-year 
contracts for hydrogen related research that would be terminated under 
the fiscal year 2010 DOE budget request. How many of these contracts go 
through fiscal year 2010? What is the amount of funding that would be 
required in fiscal year 2010 to honor these existing contracts?
    Answer. The refocused Fuel Cell Technologies program allows the 
Department to prioritize technologies that will have a more immediate 
energy impact and bring consumers advanced transportation choices 
sooner. Certain projects in the areas of hydrogen production and 
delivery, hydrogen storage, technology validation, systems analysis, 
manufacturing, safety and codes and standards, education, and market 
transformation would not be funded at the 2010 request level. If the 
Department continued on the previous schedule, the 190 projects would 
require approximately $105 million in fiscal year 2010. However, 
project performers know that funding is subject to annual appropriation 
and changing priorities.
    Question. Congress set up the Hydrogen Technical Advisory Committee 
(HTAC) to provide detailed analysis of the hydrogen and fuel cell 
vehicle program to the Secretary. Did you consult with the HTAC before 
making the decision to terminate the hydrogen and fuel cell vehicle 
programs?
    Answer. The Secretary considered all available information before 
making the decision to re-focus research, development and demonstration 
activities on fuel cell system technologies. While the HTAC 
periodically submits reports, letters and other information to the 
Secretary for consideration, the HTAC primarily provides valuable 
technical progress information, which is only one of multiple entities 
supporting DOE funding allocation decisions.
    Question. The 2006 Hydrogen Posture Plan established key technical 
milestones and timelines. Would you agree that the hydrogen program has 
been meeting and exceeding these milestones? If this is the case, how 
would the fiscal year 2010 budget request not be short-circuiting the 
progress being made by this program?
    Answer. The Department agrees that the program has been meeting a 
number of the milestones. However, given the Nation's economic climate 
and the urgency in addressing climate change and petroleum reduction, 
the Department is balancing the advanced transportation technology 
portfolio to fast-track lower-risk energy technologies and to bring 
consumers near-term, advanced transportation choices. Technologies such 
as biofuels and plug-in electric drive vehicles will achieve benefits 
sooner, at less cost, and with less technology risk than hydrogen fuel 
cells.
    In addition, the Recovery Act provides approximately $41.9 million 
for near-term benefits such as commercialization and deployment of fuel 
cells and job creation in fuel cell manufacturing, installation, 
maintenance, and support services that will help develop a supply base 
that could eventually support automotive applications. The Department 
also plans to spend up to approximately $50 million in fiscal year 2010 
through the Office of Science for relevant cross-cutting basic research 
(e.g. catalysis, membranes and biological/photoelectrochemical 
approaches) to enable breakthroughs in hydrogen technologies and $16.4 
million through the Office of Fossil Energy to continue work on 
hydrogen production from coal, with carbon sequestration, due to the 
importance of zero carbon approaches.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray

    Question. Secretary Chu, I am pleased to see an overall increase 
for Energy Efficiency and Renewable Energy. We've got to move forward 
toward a clean energy economy and this will help keep us on that path.
    And now that you have spent some time at the Department, I'm 
looking forward to hearing an update on the Water Power Program. As you 
know, the Program received $40 million in fiscal year 2009 and the 
President is requesting a 25 percent reduction in funding, which I am 
very concerned about. We must continue investment in our existing hydro 
facilities to allow us to use those flexible resources to firm up 
intermittent renewable resources like wind and solar. And we must also 
increase our work to develop new marine and hydrokinetic technologies 
that may also be able to act as base load resources in the future.
    What are your priorities for the Water Power program, specifically 
with regard to both marine and hydrokinetic technologies and also with 
regard to conventional hydropower?
    Answer. DOE is excited about the potential to develop both emerging 
marine and hydrokinetic technologies as well as untapped hydropower 
resources, including efficiency or capacity upgrades at existing 
facilities, the construction of hydropower plants at existing non-
powered dams, and the possible construction off small or ``low-impact'' 
hydropower and pumped storage facilities.
    The $40 million appropriated for water power in fiscal year 2009 
allowed DOE to initiate aggressive action to address both marine and 
hydrokinetics and conventional hydropower, and the Department is 
working diligently to ensure this new increased level of funding is 
spent carefully and wisely. The Department's current priorities for 
marine and hydrokinetic technologies (i.e. wave, tidal, in-stream, 
ocean current, and ocean thermal) are to evaluate the cost and 
performance of the various technology types, to determine how much 
energy is available and extractable from each resource, to support the 
industry in designing and testing innovative energy conversion devices, 
and to predict and evaluate the possible environmental impacts of water 
power technologies. As the size of these resources and the ability of 
emerging technologies to capture those resources becomes clearer, the 
Department will be better able to determine if higher funding levels 
are necessary.
    DOE also recognizes that incremental conventional hydropower 
generation requires a careful second look, and is particularly 
enthusiastic about its potential to provide on-demand, dispatchable 
power to support grid stability and further integrate variable 
generation. The Department's priorities for hydropower are to address 
barriers to the development of incremental hydropower generation 
(including efficiency and capacity upgrades at existing facilities and 
the construction of facilities at existing non-powered dams) and to 
address the development of pumped storage. DOE is undertaking a 
comprehensive effort to understand existing hydropower assets and 
resources, to identify undeveloped incremental hydro resources and 
costs, to quantify and maximize the value of the existing hydro fleet 
to support the grid, and to improve the environmental performance of 
hydropower generation in the United States.
    Question. Mr. Secretary, I've already reiterated my invite for you 
to come out to Washington and see the DOE footprint in my State. And I 
also want to encourage you--again--to visit the Marine Sciences 
Laboratory in Sequim, Washington. Not only is it located on the 
beautiful Olympic Peninsula, it is also the Department's only marine 
sciences lab. I encourage you to use the Water Power Program to expand 
the work at the lab, and utilize the expertise and knowledge there.
    I am not reassured that this administration sees the value of this 
potential clean energy source. Can you tell me how you plan to 
integrate the Marine Sciences Laboratory into the Water Power Program?
    Answer. The Department is funding a number of activities in the 
Pacific Northwest, including PNNL's Marine Sciences Lab. Researchers at 
the Marine Sciences Laboratory work closely with the DOE-funded 
Northwest National Marine Renewable Energy Center, a partnership among 
DOE, the University of Washington, and Oregon State University. The Lab 
also supports environmental assessments at two tidal energy projects in 
the Puget Sound led by 2008 DOE grant recipients, Verdant Power and 
Snohomish County Public Utility District, so that it can thoroughly 
test and develop marine energy technology designs and launch 
demonstration projects. In addition, two DOE solicitations (FOAs No. 
DEFOA0000069 and 0000070) for water power projects closed on June 4, 
which included environmental studies for marine energy, and for which 
PNNL was eligible to apply.
    Question. Secretary Chu, hydropower is an important clean energy 
resource in the Pacific Northwest. Work is needed to assess potential 
resources and environmental impacts, technical upgrades, integration 
with renewable, and the potential of pumped storage. How do you plan to 
support these conventional hydropower needs within the Water Power 
program?
    Answer. The Department recognizes the strong role that conventional 
hydropower plays in our Nation's renewable energy portfolio and is 
enthusiastic about exploring further the untapped potential of 
incremental conventional hydropower. We are addressing its needs in our 
Water Power Program through four strategic objectives: understanding 
assets and resources, increasing incremental power generation, 
improving environmental performance, and maximizing hydropower values 
to the grid. A key first step is a project the Department is calling 
the National Hydropower Asset Assessment. This effort will build and 
analyze a unique and comprehensive database of existing Federal and 
non-Federal projects, their generation outputs, and water availability 
at the projects. This assessment will also provide a basis for 
evaluating current technology needs and opportunities that will help 
hydropower maintain its important position among renewable energy in 
the United States.
    The Department is also soliciting new, industry-led projects to 
assess undeveloped hydropower resources at existing dams in the United 
States. This opportunity is encompassed within the Advanced Water Power 
Funding Opportunity Announcement (DE-FOA-0000069), which will be 
announced this summer. DOE laboratories are also engaged in providing 
new engineering and environmental R&D to support the hydropower 
industry.
    Question. Mr. Secretary, what incentives can we put in place to 
facilitate the development of new pumped storage resources and the 
continued investment in our existing hydro facilities, to allow us to 
use those flexible resources to firm up intermittent renewable 
resources like wind and solar?
    Answer. Development of new pumped storage projects in the United 
States faces major challenges in two areas: financing very large 
capital construction costs, and surviving a long, costly, and uncertain 
regulatory process that is as complex as that associated with nuclear 
power. If new pumped storage projects used renewable energy in their 
pump cycle, these projects could also get consideration for inclusion 
in renewable energy standards, which would provide an additional 
financial incentive for development. Other policy initiatives that 
would help this type of development include streamlining the regulatory 
process and designing energy markets that return more reliable, long-
term benefits to developers of generation units that provide valuable 
services to the Nation's electricity grid.
    DOE recently issued a Notice of Intent on the $3.3 billion Smart 
Grid Investment Grant Program and a draft Funding Opportunity 
Announcement (FOA) for an additional $615 million for Smart Grid 
Demonstrations funded by the Recovery Act. Energy storage technology 
and specifically smart grid applications, including integration of 
pumped hydro storage with renewable resources like wind and solar, are 
within the scope of these two Recovery Act projects. The Department is 
in the process of reviewing all comments received during the public 
commenting period for incorporation into the final FOAs, both of which 
are expected to be released in June 2009 through the FedConnect portal 
at www.fedconnect.net.
    Question. As DOE builds toward President Obama's clean energy 
economy, how will DOE evaluate a resource's contribution to and 
potential to meet these important, ambitious energy and environmental 
goals? What role does DOE anticipate for hydropower in helping to meet 
these objectives, especially as Congress moves to address global 
warming?
    Answer. DOE is actively investigating the potential role of water 
power technologies, including both emerging marine and hydrokinetic 
technologies as well as conventional hydropower, in meeting the 
President's clean energy goals.
    The Department is working to better understand the role for the 
full suite of marine and hydrokinetic technologies, including wave, 
tidal, ocean current, river in-stream, and ocean thermal energy, by 
evaluating the cost and performance of the various technology types, 
determining how much energy is available and extractable from each 
resource, supporting the industry in designing and testing innovative 
energy conversion devices, and predicting and evaluating the possible 
environmental impacts of water power technologies. As the size of these 
resources and the ability of emerging technologies to capture them 
becomes clearer, the Department will better be able to assess their 
true potential in contributing substantially to the national 
electricity generation portfolio.
    In addition, DOE is enthusiastic about the potential development of 
certain untapped hydropower resources, including efficiency or capacity 
upgrades at existing facilities, the construction of hydropower plants 
at existing non-powered dams, and possibly the construction off small 
or ``low-impact'' hydropower and pumped storage facilities. As a large-
scale, and quickly dispatchable generation source, incremental 
hydropower may be able not only to provide a clean and renewable source 
of electricity but also facilitate the further integration of 
intermittent renewable resources.
    Question. As you know, transportation emissions are a significant 
source of greenhouse gas emissions. This administration is investing 
considerably in alternative fuels for energy security and environmental 
reasons; however, most of those are focused on personal vehicles. As 
you know, air transportation is solely dependent on jet fuels at this 
time. What thought has DOE given to advancing jet biofuels, including 
research and development, feedstock development, technology and 
infrastructure?
    Answer. Traditionally, DOE has focused on ground transportation 
fuels, while most air transportation work has been conducted by the 
Department of Defense, the Department of Transportation and the 
National Aeronautics and Space Administration. However, DOE has begun 
to focus on the production of heavy duty fuels including, ``green'' and 
renewable diesels, and aviation fuels.
    For example, the Joint BioEnergy Institute led by Lawrence Berkeley 
National Laboratory is re-engineering microbes to produce hydrocarbon 
fuels like green gasoline, diesel, and jet fuel. A subset of recently 
selected DOE Energy Frontiers Research Centers will focus on 
fundamental research related to producing advanced biofuels, such as 
bio-oils from microalgae, which are promising intermediates for the 
production of advanced biofuels, including green jet fuel. The National 
Renewable Energy Laboratory, Sandia National Laboratory, and other 
laboratories are also launching research into algal biofuels for the 
Defense Advanced Research Projects Agency and Air Force Office of 
Scientific Research. Algae-based fuels will also be eligible for both 
Advanced Research Projects Agency-Energy and DOE Loan Guarantee funding 
opportunities.
    Additionally, DOE will use Recovery Act funding to support a 
competitive solicitation for two research consortia aimed at 
accelerating the development of cost competitive advanced fungible 
biofuels, which include hydrocarbon fuels, diesel and jet fuel, and 
algae based biofuels which also include jet fuel. The solicitation is 
expected to be released in the summer of 2009. In order to capture 
relevant technologies that are ready for deployment, a current 
competitive solicitation closing on June 30, 2009 allows for pilot- and 
demonstration-scale biorefineries that include jet fuel from biomass. 
DOE's Office of Fossil Energy announced $70.6 million of Recovery Act 
funding will be spent to facilitate the existing algae-based carbon 
mitigation project at Cholla Power Plant in Holbrook, Arizona to expand 
testing with a coal-based gasification system. The goal is to produce 
fuels from domestic resources while reducing atmospheric CO2 
emissions. DOE's Office of Fossil Energy and the National Energy 
Technology Laboratory issued a Recovery Act funding opportunity on June 
8 that allows conversion of to CO2 biomass (algae, for 
example) and subsequent biofuels production as a mechanism of 
CO2 sequestration and use.
    Question. Secretary Chu, I want to ask about a section of the 
hydrogen fuel cell budget, the Market Transformation program. This 
subcommittee has in the past supported the Market Transformation, which 
helps support fuel cell deployment in early commercial applications, 
because we share your view that we ought to do now what we can do now 
on fuel cells. I understand that you allocated a small part of the 
stimulus dollars to fuel cell deployment this year. Can you tell me why 
the President's budget proposes no funding for Market Transportation 
program?
    Answer. The President's budget proposes no additional funds for 
market transformation activities in fiscal year 2010 because the $41.9 
million of Recovery Act funding dedicated to fuel cell market 
transformation activities will support 13 projects over fiscal year 
2009 and fiscal year 2010. These projects will deploy more than 1,000 
fuel cells and will help create jobs in fuel cell manufacturing, 
installation, maintenance and support service sectors. Together with 
$72.4 million of industry cost-share, the total 2-year funding for 
these projects is $114.3 million.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett

        LOAN GUARANTEES--LOAN PROGRAM--3.5 YEARS AND NO REWARDS

    Question. Mr. Secretary, the Department has taken over 3.5 years to 
establish the loan guarantee program and it still has not granted a 
single loan guarantee. I believe this program has tremendous potential, 
but worry that it is not being implemented in a timely and effective 
manner. For example:
    GAO recently notified the subcommittee staff that the current 
subsidy model used to establish the risk premiums paid by applicants 
was suspended in February by OMB.
    Finally, I understand you have also proposed several changes to the 
operations of the loan guarantee program, but many of these reforms 
have yet to be implemented.
    How soon, will you be implementing your reforms and will any of 
these changes require legislation?
    Answer. The Department is continuously implementing changes in its 
procedures that facilitate the loan guarantee process. The Department 
of Energy has not identified any needed legislative changes.
    Question. When do you expect to make final awards in light of OMB 
suspending the use of the credit subsidy model?
    Answer. To clarify, OMB did not suspend the credit subsidy model. 
In implementing the model, the Department identified a technical issue 
related to certain types of projects and OMB and DOE have resolved the 
issue. The Department issued a conditional commitment for its first 
loan guarantee in March and issued two additional conditional 
commitments in July.
    Question. Is there anything Congress can do to help?
    Answer. The Department appreciates Congress's support for this 
important program.

                            INDUSTRY LETTER

    Question. I have attached a copy of the letter sent to the 
President regarding specific reforms to the Loan Guarantee program.
    Can you please review each of the specific recommendations and 
provide a written response to the subcommittee as to your position of 
each of the policy recommendations and possible impact to the program.
    Answer. The Department is currently reviewing the letter.
    not all science funding is equal--especially at the weapons labs
    Question. Mr. Secretary, I am troubled by the disparity in funding 
for applied and fundamental scientific research provided to DOE labs 
verses the NNSA labs. Clearly, the cancellation of the Los Alamos 
Neutron Science Center (LANSCE) Refurbishment is the most glaring 
example of the selectiveness of the research funding in this budget. 
The LANSCE facility is the scientific corner stone of Los Alamos, 
serving both classified and unclassified work and with over 500 users 
annually.
    How do you explain the failure in the budget to link the DOE and 
NNSA science?
    Answer. Budgeting is, in the end, an exercise in priorities and 
choices with limited resources. While there is certainly good science 
that could be done with a refurbished LANSCE, other investments in both 
NNSA and Science facilities will yield a greater and more immediate 
benefit. A refurbishment could be considered in the next budget cycle.
    Question. The OMB Web site lists LANSCE refurbishment as a 
terminated program and specifically states one reason being that 
Nuclear Energy Office doesn't support isotope production any longer. 
Last year the isotope program was shifted to the Office of Science 
program. Will LANSCE continue to have a roll [sic] in the Science 
program?
    Answer. The Isotope Production Facility (IPF) at LANSCE uses a 
portion of the H+ beam extracted at 100 MeV from the 
accelerator; this facility produces a variety of radioisotopes used in 
medical diagnosis and treatment and for scientific research. Together 
with DOE's Brookhaven and Oak Ridge National Laboratories, the IPF 
provides the national supply of radioisotopes not available 
commercially for both research and applications. In addition to regular 
fiscal year 2009 appropriations and an fiscal year 2010 request within 
the Office of Science, the IPF is currently receiving Recovery Act 
funds from the Office of Science for enhanced isotope production 
capabilities and R&D. The LANSCE accelerator also supplies protons to 
the Lujan Center, a pulsed spallation neutron source that is used by 
researchers supported by the Office of Science, NNSA, and other 
agencies.

           THE NEED FOR SCIENTIFIC LEADERSHIP WITHIN THE NNSA

    Question. Mr. Secretary, in light of your budget, which fails to 
adequately invest in building the science missions at the NNSA labs, I 
believe we need to establish a new position within the NNSA to steward 
and cultivate scientific research using the existing NNSA facilities. I 
believe this position should report to Secretary, Deputy Secretary and 
the NNSA Administrator. This might help raise awareness of both the 
weapons science, and non-weapons science that goes on at our NNSA labs. 
Certainly the grand challenge of energy security and climate change 
science are of such complexity that this work can and should be shared 
with all the labs.
    I am considering a modification to the NNSA Act to create a new 
position within the NNSA reporting directly to you to lead the NNSA 
science program and to work with the rest of the Department to 
integrate the national security capabilities with those in basic and 
applied programs within DOE. What do you think about that?
    Answer. I share your concern about sustaining science and 
engineering vitality at the NNSA's laboratories at Los Alamos, 
Livermore and Sandia. We are considering how to best broaden and 
sustain our science underpinning of nuclear security and how to do that 
appropriately for the related interests of other agencies that use 
these laboratory capabilities for science and national security 
missions. It is possible that a new position as you describe could be 
appropriate and useful in sustaining and advancing the science and 
engineering the Nation needs. At present we are focusing on basis and 
needs for our nuclear security science and engineering considering both 
the Department's missions and the related interests such as those in 
the intelligence community, the Department of Defense and the 
Department of Homeland Security. Within a few months, when I have a 
clearer picture of the basis and needs for these science and 
engineering skills, we will be in a better position to discuss the 
change you propose.

                        FOSSIL ENERGY--FUTUREGEN

    Question. The FutureGen project was halted due to cost escalations, 
but it is my understanding that the administration is considering 
resuming this project, using $1 billion in Recovery Act Funds to do so.
    Can you share with us your thoughts on resuming this project?
    Answer. DOE officials have been meeting with officials of the 
FutureGen Industrial Alliance, Inc., and on June 12, Secretary Chu 
announced that an agreement was established with the Alliance to move 
forward with the FutureGen project pending a joint decision based on a 
detailed cost estimate and fundraising activities, thereby limiting the 
risk of cost increases while accomplishing the goals of the program.
    Question. There is roughly $1.5 billion available for the Clean 
Coal Power Initiative (CCPI) round three solicitation. This far exceeds 
the initial requested amount for this solicitation, and in large part 
is due to project defaults from previous rounds. This research also 
mirrors the demonstration goals of building a zero-emission coal plant 
as proposed by FutureGen.
    Will you please explain to us why you are considering restarting 
the FutureGen project, when that same type of research is available for 
the CCPI round three solicitation?
    Answer. The FutureGen project has already completed conceptual 
design, project siting, approximately 1 year of preliminary design 
activities, an extensive Environmental Impact Statement (EIS), and an 
associated risk assessment. With those activities already completed, if 
the project was reinstated in the near future, the FutureGen Alliance 
conceptually could complete preliminary and detailed design and, if a 
decision were made to proceed, potentially could start the construction 
phase in 2010. Conversely, commercial demonstration projects resulting 
from the CCPI round three solicitation are at the proposal or project 
definition stage of development. Accordingly, it may take those 
projects considerable time to commence construction, compared to 
FutureGen. Given the time-sensitive nature of both climate change and 
economic recovery, the FutureGen project (if it is restarted) could 
provide a demonstration of technology that could accelerate follow-on 
activities such as CCPI projects (where relevant.) Also, CCPI 
demonstration projects may involve different technologies and site 
locations than FutureGen. We believe it is prudent to develop a 
portfolio of power plant and carbon capture technologies, as well as to 
compile operational experience on different regional sequestration 
geologies throughout the United States.
    The FutureGen Project will provide for the design, construction and 
operation of a coal-fueled, integrated gasification combined cycle 
(IGCC) with pre-combustion subsystems for the capture of carbon dioxide 
and geologic sequestration into a saline formation. In comparison, 
CCPI-3 will provide commercial demonstration projects that may include 
post-combustion capture systems or an oxy-fueled combustion process. 
CCPI-3 will provide one or more sequestration options, including 
beneficial reuse in enhanced oil recovery or enhanced coal bed methane 
recovery options as well as the possibility of basalt formations or 
stacked storage. The different approaches provided by these programs 
will support an expanded portfolio providing the DOE the ability to 
make progress toward capture and sequestration goals.

                                SCIENCE

    Question. This budget includes over $300 million in new Secretarial 
priority initiatives, while funding for Nuclear Energy, Fossil Energy 
and NNSA Science have all been reduced.
    How do you reconcile this investment?
    Answer. Under the Secretary's proposed initiatives the Department's 
overall investment in Nuclear Energy, Fossil Energy, and NNSA will 
actually increase, with new funding going into areas with the biggest 
potential pay-off for the Nation. In Nuclear Energy, the Secretary is 
proposing two new Energy Innovation Hubs, one to support ``Extreme 
Materials'' with the goal of achieving higher reactor efficiencies and 
one to support advanced computer modeling and simulations of nuclear 
processes and systems. For Fossil Energy, a Hub is envisioned to 
advance Carbon Capture and Sequestration technology. And, within the 
NNSA, funding shifts from construction to the transition of the 
National Ignition Facility to a fully capable experimental facility in 
pursuit of the first ignition campaign.
    In addition, the RE-ENERGYSE program (Regaining our ENERGY Science 
and Engineering Edge) is a $115 million new initiative designed to 
attract and train the next generation workforce for the 21st century 
energy economy. RE-ENERGYSE will support education and R&D initiatives 
in all energy programs.

                                 ARPA-E

    Question. In light of the new Energy Hubs, large untapped potential 
in the loan guarantee program, and substantial funding increases for 
EERE and Science, I am trying to figure out the role ARPA-E at the 
Department of Energy, except as another layer of bureaucracy.
    Can you please provide a specific example or technology that will 
benefit from ARPA-E and how is it different from the loan guarantee 
program, office of science or renewable energy efforts?
    Answer. ARPA-E is a highly entrepreneurial program that will fund 
``creative, out-of-the-box, transformational'' energy research not 
currently funded by other programs. ARPA-E seeks to accelerate 
transformational advances in areas which address national energy 
priorities and are too risky for industry to invest in without public 
support. Transformational R&D is about creating new ways of doing 
things and leading to the next generation of technology that will allow 
the United States to be competitive in the global market.
    ARPA-E will seek out the best ideas and move quickly to bring 
selected immature energy technologies with exceptional potential beyond 
the risk barriers that prevent their translation from the laboratory 
bench to the marketplace. Essential aspects of this nimble and flexible 
approach include:
  --Technology Focus Flexibility.--ARPA-E will look for the best 
        opportunities to improve energy security and curb climate 
        change by making significant programmatic investments lasting 2 
        to 5 years. ARPA-E will fund transformational, high risk 
        technologies with the potential for 2-3  improvements in 
        technology performance and/or cost when compared to current 
        technologies. ARPA-E will then move on to the next big ideas, 
        shifting into and out of areas depending on the most promising 
        opportunities for transformational change.
  --Programmatic Flexibility.--ARPA-E will have the flexibility to 
        forge and nurture optimized partnerships that combine unique 
        talents and insight from different fields. The programs can use 
        DOE's ``Other Transactions'' authority (Technology Investment 
        Agreements) to help attract organizations that traditionally do 
        not participate in Government RD&D programs. Also, ARPAE will 
        promote results-oriented programs through the use of 
        challenging program milestones and the discipline to end 
        programs that fail to perform.
  --Organizational Flexibility.--ARPA-E is a lean, flat organization 
        that reports directly to the Secretary of Energy. ARPA-E has 
        very broad hiring authority to attract program managers from 
        universities, industry, the venture capital community and 
        elsewhere. Program managers will be part of the organization 
        for 3 year terms--not for their entire career. After having 
        made a successful technology impact, they will move on to other 
        opportunities in industry, academia, and elsewhere. ARPA-E's 
        structure will promote technical and programmatic agility by 
        ensuring that the organization has the right resources to 
        address the goal of enhancing the United State's economic and 
        energy security.
    These essential aspects of ARPA-E's approach will allow scientists 
and technologists to rapidly bring transformational ideas to a level of 
maturity sufficient for industry to take over development and bring the 
resultant technologies to market. ARPA-E's mission is to enhance the 
economic and energy security of the United States by developing new 
energy technologies that offer the potential for making significant 
progress toward reducing imported energy; reducing energy-related 
emissions, including greenhouse gases; and improving energy efficiency.
    Each of the other existing DOE organizations has a unique role that 
ARPA-E complements.
  --The Office of Science (SC) is charged with discovery and knowledge 
        generation. SC is focused on the fundamentals of energy-related 
        science, generating new discoveries and a base of knowledge 
        which are used to create future energy technologies and improve 
        existing ones.
  --The Office of Energy Efficiency and Renewable Energy (EERE) and the 
        other Applied Programs at DOE are focused on applied R&D as 
        well as demonstration and deployment activities in specific, 
        targeted, program areas which address national energy 
        priorities and in collaboration with industry. Both EERE and 
        ARPA-E focus on high pay-off technology development. However, 
        EERE supports a more focused suite of technologies through a 
        longer gestation period. Such longer-term support may include 
        commercial viability demonstration projects which are often 
        necessary before market acceptance of capital-intensive energy 
        technologies as well as activities which address other 
        information, market, and regulatory barriers to technology 
        adoption. The commercial demonstration projects involve large 
        scale engineering and process integration work and require 
        specialized management and oversight.
  --The Energy Innovation Hubs, modeled on the Department's successful 
        Bioenergy Research Centers, will focus significant R&D 
        resources within SC, EERE and other Applied Programs on a 
        sustained development approach to basic and applied R&D on our 
        most critical energy science and technology challenges. This is 
        to be contrasted with the opportunistic style of ARPA-E, which 
        is designed to push an area rapidly forward and then move on to 
        another priority. Each Hub will be comprised of a highly 
        collaborative team spanning many disciplines and drawn from the 
        full spectrum of R&D practitioners--including universities, 
        private industry, non-profits, and national laboratories--and 
        each Hub is expected to become a world leader for R&D in its 
        topical area. The Hubs will support cross-disciplinary R&D 
        focused on the barriers to transforming energy technologies 
        into commercially deployable materials, devices, and systems. 
        Each Hub has proposed funding at $25 million per year, for a 5-
        year term, with additional start-up funding of $10 million in 
        the first year for renovation (but not ``bricks and mortar''), 
        equipment, and instrumentation.
  --The Loan Guarantee Program is for a later stage of technology 
        development, guaranteeing loans to support early commercial use 
        of advanced technologies (and for a limited time commercial 
        technologies under the Recovery Act). The Loan Guarantee 
        Program is targeted at early commercial use, not energy 
        research, development, and demonstration programs.
    Each of the organizations has a unique contribution for creating, 
developing, and deploying the energy technologies this Nation needs. 
ARPA-E was formed this spring and has released its first solicitation, 
but has not yet selected nor funded any projects. ARPA-E is organized 
to manage high risk R&D projects proactively. Many years of experience 
in scientific research and technology development have shown that 
different stages of the science and technology enterprise need 
different management styles and organization. ARPA-E complements the 
existing DOE organizations by adding one specifically organized and 
focused on high-risk transformational technologies.

                             NUCLEAR ENERGY

    Question. Will the United States continue to play a role in the 
Global Nuclear Energy Partnership international discussions and 
contribute actively to these meetings and support international 
research and best practices regarding nuclear safety, security and 
nonproliferation? Will the Department of Energy continue to send staff 
to participate in these meetings?
    Answer. Yes, the United States continues to support the objectives 
of the international component of GNEP and the use of civil nuclear 
energy in ways that advance safety, security and nonproliferation. The 
Department continues to participate in the GNEP international meetings 
while the subject of how best to achieve GNEP-international objectives 
is undergoing an interagency review. We believe that proliferation 
issues should be a top priority in any discussions about the expanded 
use of civil nuclear energy and, in particular, in discussions that 
relate to development, deployment and operation of fuel cycle 
technologies. Thus, it is important for the Department to remain 
engaged in international meetings and activities that are developing 
strategies to ensure reliable nuclear fuel services and to provide 
management options for spent fuel in a manner that minimizes 
proliferation concerns.

                             YUCCA MOUNTAIN

    Question. Nuclear power will be critical to reaching our energy 
independence and reducing our reliance on fossil fuels. Yet, with the 
termination of Yucca Mountain in this budget, we still have no clear 
strategy on how to deal with nuclear waste.
    Exactly what is the Department's strategy to deal with spent fuel?
    Answer. The administration intends to convene a ``blue-ribbon'' 
panel of experts to evaluate alternative approaches for meeting the 
Federal responsibility to manage and ultimately dispose of spent 
nuclear fuel and high-level radioactive waste from both commercial and 
defense activities.
    Question. Why should the ratepayers, who have paid $20 billion in 
fees, be forced to continue to store on site and not be entitled to a 
refund of these fees?
    Answer. We remain committed to meeting our obligations for managing 
and ultimately disposing of spent nuclear fuel and high-level 
radioactive waste. The administration intends to convene a ``blue-
ribbon'' panel of experts to evaluate alternative approaches for 
meeting the Federal responsibility to manage and ultimately dispose of 
spent nuclear fuel and high-level radioactive waste from both 
commercial and defense activities. The administration looks forward to 
ongoing dialogue with members of Congress, interested stakeholders, and 
others as we review these alternative approaches in the months ahead.
    Question. You have announced that you intend to appoint a Blue 
Ribbon Commission to consider all the options for addressing our spent 
fuel needs.
    When do you intend to appoint this commission and what will they 
specifically be asked to consider?
    Answer. The ``blue-ribbon'' panel will provide the opportunity for 
a full public dialogue on how best to address this challenging issue 
and will provide recommendations that may form the basis for working 
with Congress to revise the statutory framework for managing and 
disposing of spent nuclear fuel and high-level radioactive waste. As we 
go forward with convening the panel, I will keep Congress informed of 
our progress.

        IDAHO NATIONAL LAB--NEXT GENERATION NUCLEAR PLANT (NGNP)

    Question. Mr. Secretary, the Idaho laboratory has aggressively 
pursued the Next Generation Nuclear Plant (NGNP) project. The Energy 
Policy Act of 2005 authorized the construction of this reactor at the 
Idaho National Lab.
    The fiscal year 2010 budget documents make no mention of this 
plant. In fact, rather than prioritizing research on two advanced 
technology reactors which were down selected last year, this budget 
proposes to expand research back to 6 types of advanced reactors.
    Can you please explain the justification for expanding the 
Department's research priorities? Where is this program headed and what 
does it mean for the NGNP reactor at Idaho?
    Answer. The fiscal year 2010 budget request of $191 million 
represents a firm commitment to move forward with needed long term 
research and development on underlying technologies supporting 
Generation IV reactor concepts, including high temperature gas reactors 
under consideration for the Next Generation Nuclear Plant (NGNP). The 
request also includes $35 million for a modeling and simulation Energy 
Innovation Hub. The Department is currently evaluating its long-term 
plans for the NGNP project, which would rely on the private sector 
entering into a cost-sharing partnership with the Department. This 
budget request reflects the Department's commitment to be a strong 
partner in support of gas reactor technology.

                                PENSIONS

    Question. Understanding that the pension funding shortfalls 
continue to shift on a daily basis; will the Department please provide 
written quarterly updates regarding the estimated pension shortfalls 
and programmatic impacts?
    I think every member of this subcommittee would classify 
Environmental Cleanup as a priority, and you can see this in the 
funding provided in the Recovery Act. However, your request decreases 
the funding from fiscal year 2009 based on funding in the Recovery Act. 
EERE and Science also received large sums of money in the Recovery Act, 
but both of those programs are increased in your budget request.
    How can you justify cutting cleanup because of Recovery Act funds, 
when you have a $400 million pension shortfall in this program?
    Answer. The Department closely monitors the funding obligations 
associated with DOE contractor sponsored defined-benefit (DB) pension 
plans. Each contractor that sponsors a DB pension plan collects 
information to determine a plan's funded status as of the end of each 
pension plan year (that for most plans is December 31) that is then 
certified by a plan's actuary as of April 1. This funded status is the 
basis for determining what level of funding the contractor must 
contribute to a DB pension plan to ensure that as of the end of a plan 
year the plan is funded in accordance with applicable law (e.g., the 
Employee Retirement Income Security Act) and Departmental direction. 
Evaluations of a plan's funded status at interim points during the 
pension plan year would not change the level of funding required for 
that pension plan year or provide any certainty about what level of 
funding will be needed for the next pension plan year. Therefore, 
quarterly updates on the funded status of a plan would not provide 
information that would be useful in determining the amount of funds 
that will be needed to meet annual funding requirements. However, the 
Department is prepared to brief your staff on this issue at any time.
    The fiscal year 2010 budget request for the Environmental 
Management program supports the Department's mission and allows 
contractors to make all required pension payments to their DB pension 
plans.
    Question. Do you foresee any layoffs at any of the cleanup sites as 
a result of unfunded pension obligations?
    Answer. The Department closely monitors the funding obligations 
associated with DOE contractor sponsored defined-benefit (DB) pension 
plans. Each contractor that sponsors a DB pension plan collects 
information to determine a plan's funded status as of the end of each 
pension plan year (that for most plans is December 31) that is then 
certified by a plan's actuary as of April 1. This funded status is the 
basis for determining what level of funding the contractor must 
contribute to a DB pension plan to ensure that as of the end of a plan 
year the plan is funded in accordance with applicable law (e.g., the 
Employee Retirement Income Security Act) and Departmental direction. 
Evaluations of a plan's funded status at interim points during the 
pension plan year would not change the level of funding required for 
that pension plan year or provide any certainty about what level of 
funding will be needed for the next pension plan year. Therefore, 
quarterly updates on the funded status of a plan would not provide 
information that would be useful in determining the amount of funds 
that will be needed to meet annual funding requirements. However, the 
Department is prepared to brief your staff on this issue at any time.
    The Department does not anticipate impacts to the EM contractor 
workforce during fiscal year 2010 due to contractor funding of DB 
pension plans.

                         ENERGY INNOVATION HUBS

    Question. Mr. Secretary, this budget provides $280 million to 
establish eight energy hubs, a personal priority of yours. These eight 
centers of excellence will attack energy related problems in a 
collaborative manner.
    Why did the budget recommend establishing a hub for extreme 
materials research within the Office of Nuclear Energy and at the same 
time cancel the refurbishment of the Los Alamos Neutron Science Center, 
which supports a similar mission and also has computing capabilities?
    Answer. The Energy Innovation Hub for Extreme Materials will be 
competitively chosen. Its mission will be to support cross-disciplinary 
research and development focused on the barriers to transforming energy 
technologies into commercially deployable materials, devices and 
systems. Since the location and specific work scope of the Energy 
Innovation Hub for Extreme Materials will be decided through a 
competitive procurement process, it must be independent of the 
refurbishment of the Los Alamos Neutron Science Center.
    While there is certainly good science that could be done with a 
refurbished LANSCE, DOE believes that other investments in other 
facilities will yield a greater and more immediate benefit.
    The eight Energy Innovation Hubs will advance highly promising 
areas of energy science and technology from their early research 
concept stage to the point where the risk level is low enough for 
industry to deploy them into the marketplace. The work of the Hubs will 
encompass the full span from basic research to engineering development 
to commercialization and hand-off to industry.
    Question. Did the Department give any thought to establishing a hub 
to focus on environmental cleanup? What about a hub to defeat the cyber 
security threat?
    Answer. The Department deliberated at length on the optimum number 
and topics for the Energy Innovation Hubs. The goal for the Hubs is to 
make significant progress in overcoming current barriers to the United 
States' becoming a global leader in new energy technologies. The focus 
of the Hubs is on development and commercialization of clean, economic, 
sustainable energy technologies.
    Neither the Environmental Management program nor Cyber Security 
efforts in the Department fall within this ``energy technologies'' 
focus of the Hubs. And, in fact, each of these efforts is already well 
defined and supported. That said, the concept of establishing a Hub for 
either Environmental Management or Cyber Security could be considered 
in the future if such an idea seemed advisable.

                             WEATHERIZATION

    Question. The weatherization assistance program has over $5 billion 
available from the ARRA, Continuing Resolution, and fiscal year 2009. I 
am told that the Department will be spending that money over the next 3 
years.
    How can you justify another $220 million request when you cannot 
spend it this fiscal year?
    Answer. To achieve the increases in the numbers of homes 
weatherized, State and local agencies are in the process of hiring and 
training thousands of workers. In addition to increased hiring, State 
and local agencies will be making a substantial capital investment in 
procuring vehicles and equipment to outfit these new weatherization 
crews. However, the ``ramp-up'' in the number of weatherized homes per 
month enabled by Recovery Act funds will not be fully realized until 
the hiring, training, and acquisition process is completed. DOE expects 
that the weatherization network should be close to its target rate of 
22,000 homes weatherized per month by the end of the year. As a result, 
DOE expects that weatherization activities enabled by the Recovery Act 
should continue into 2011.
    Additional funds in fiscal year 2010 are required to maintain the 
pace of hiring, training and expansion enabled by the Recovery Act in 
order to build the capacity needed to realize the President's goal of 
weatherizing 1 million homes annually. Without this continued 
investment, new hires could be lost at the end of 3 years and local 
agencies could be saddled with excess vehicles, equipment, and costs 
associated with lay-offs of their work forces.

                             CYBER SECURITY

    Question. Mr. Secretary, the largest increase in the budget of the 
Office of Electricity Delivery and Reliability is for cyber security. 
No doubt, this is in response to the press reports that foreign hackers 
can gain access to our electrical grid.
    However, NNSA cyber security staff has briefed the subcommittee 
regarding a large and sustained increase in cyber attacks against 
Department systems this year. Unfortunately, the budget for NNSA cyber 
security fails to provide any increase to combat these cyber attacks on 
our national security infrastructure.
    How do you rationalize an increase in the Office of Electricity, 
but no increase for the NNSA?
    Answer. NNSA's cyber security budget was not increased because NNSA 
has sufficient resources to address the threats.
    Question. Do you believe you have the threats to the NNSA 
classified and national security information contained?
    Answer. The threats to the national security information and 
classified system within the NNSA computing environment are constantly 
changing and represent risks to our operations. However, with the 
technology enhancement (i.e. EnCase Enterprise) and process 
improvements (NNSA Policy (NAP)) NNSA has invested in over the past 2 
years, I believe that we have minimized the threats to the classified 
environment and national security information and are operating at an 
acceptable level of risk. The Department and NNSA senior leadership 
will continue to monitor the threats to our classified information 
technology assets along with the accompanying risks in order to make 
necessary changes and provide an appropriate level of protection.

                             URANIUM TAXES

    Question. Mr. Secretary, your budget proposes a $200 million/year 
tax on nuclear power utilities to be applied to the Uranium Enrichment 
Decommission and Decontamination Fund. This account currently enjoys a 
surplus of $4.7 billion and can sustain the ongoing cleanup for 7 years 
at current spending rates. Since these funds are not needed immediately 
and haven't been reauthorized by Congress I have to assume this is 
nothing more than a gimmick used to offset deficit spending or meet 
budget shortfalls.
    Mr. Secretary, the GAO did a study last year and found that the 
Department had a very valuable amount of unrecovered uranium sitting in 
storage at the very sites you want to cleanup. The value of these 
depleted uranium tails easily exceed the revenue raised by the tax and 
cleanup an existing liability on the Department's books.
    Will you consider the sale of the depleted uranium tails stored in 
Kentucky and Ohio as an alternative to raising taxes on utilities who 
use nuclear power and have already paid $1.5 billion in taxes already?
    Answer. The Department continues to monitor the uranium market as 
it manages various inventories of uranium declared excess to the 
Nation's national security needs. Any proceeds from any sale of the 
Department's uranium inventory will be deposited in the U.S. Treasury 
as required by the Miscellaneous Receipts Act (31 U.S.C.  3302); 
therefore, the proceeds cannot be applied toward cleanup of the gaseous 
diffusion plants.

                            CLEAN UP FUNDING

    Question. Mr. Secretary, your budget tells two distinctly different 
stories regarding the stimulus funds. When it comes to environmental 
cleanup, you justify a reduction in the fiscal year 2010 budget request 
due available stimulus funds. [sic] However, when it comes to renewable 
energy projects you have provided additional increases despite that 
program enjoying $17 billion in additional Stimulus funding.
    Can you please explain why this budget tells two completely 
different stories regarding the impact of stimulus funding on the 
budget?
    Answer. The total funding requests provided in the fiscal year 2010 
budget, in conjunction with Recovery Act funds, were carefully 
considered so as to make the biggest impact, given the status of the 
science and technology in each area.
    The fiscal year 2010 budget was formulated in light of the 
significant funding provided in the Recovery Act. Recovery funding 
enabled the Department to accelerate a number of important commitments 
in the areas of renewable energy, environmental management, grid 
modernization, carbon capture and sequestration (CCS) and basic science 
research.
    In building the fiscal year 2010 request, the administration 
adopted a thoughtful approach that considered not only whether a 
program had received Recovery Act funding, but also how those funds fit 
within our overall policy goals and priorities.
    In some cases, the Recovery Act investments are so significant that 
they amount to several years of base funding. This allowed the 
Department to make prudent use of our resources to address other high 
priorities. In other instances, like Environmental Management, the 
Recovery funding is being used on projects that meet the objectives of 
economic stimulus, but which may not ordinarily compete well against 
projects aimed at addressing the clean up of higher-risk sites. Our 
fiscal year 2010 request for EM continues to focus on high risk sites.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran

    Question. Mr. Secretary, in your budget for the Strategic Petroleum 
Reserve, you propose roughly $50 million for the purchase of a new 
cavern to replace an existing storage cavern that was said to pose ``an 
extreme environmental risk.'' My staff was informed that the Department 
purchased this cavern instead of taking advantage of salt domes already 
owned by the Department of Energy for Strategic Petroleum Reserve 
Expansion. Why?
    Answer. The Department has not purchased any new caverns for the 
Strategic Petroleum Reserve. The cavern that has been identified for 
decommissioning, Cavern 20, is located at the Bayou Choctaw site and is 
in very close proximity to the edge of the salt dome. After use during 
Hurricane Katrina in 2005, Cavern 20 experienced preferential leaching 
towards the edge of the salt dome. Continued use of the cavern presents 
a risk of major environmental danger. The fiscal year 2010 request 
proposes funding for the purchase of an existing commercial storage 
cavern that is located adjacent to the Bayou Choctaw site to replace 
the unsound cavern. It is vital for the Department to maintain its 
current inventory level and drawdown response capabilities at the Bayou 
Choctaw site because this site is the only Strategic Petroleum Reserve 
site that directly serves the refiners on the lower Mississippi River 
and refiners in the Midwest served by the Capline Distribution System. 
Crude oil releases from this site were instrumental in keeping the 
Capline system refiners supplied after the hurricanes in 2005 and 2008.
    Question. Your acting assistant Secretary for the Strategic 
Petroleum Reserve testified before the Environment and Public Works 
Committee recently about legislation sponsored by Senator Bingaman to 
create new storage for refined oil in the Strategic Petroleum Reserve. 
As you know, salt domes in my State of Mississippi were identified by 
the last administration as a possible location for the expansion of the 
Strategic Petroleum Reserve. Although funds were not included for 
expansion activities in your budget, your staff expressed interest in 
the idea of new refined oil storage capacity. The Department of Energy 
owns salt caverns in Mississippi, which could hold both refined and 
crude oil. Will Mississippi be considered as the site for this plan, 
likely to be included in the Energy package Senator Bingaman is 
planning to move through the Senate this summer?
    Answer. Although the Department has identified land for site 
development for 1 billion barrel expansion of the SPR at Richton, 
Mississippi, the Department has not acquired the land. Rather, DOE has 
completed prerequisite activities to include salt dome seismic 
analyses, site environmental surveys, and title work in preparation for 
the site acquisition. DOE has recently concluded studies for 
preparation of a Supplemental Environmental Impact Statement (SEIS) to 
find more environmentally suitable locations for the water intake 
system, the offshore brine disposal and the marine terminal in 
Pascagoula.
    The Department is currently evaluating the situation involving the 
land acquisition and the additional $31.5 million appropriated in 
fiscal year 2009 for new site expansion activities, beyond land 
acquisition.
    Question. Funding for fiscal year 2009 for the Strategic Petroleum 
Reserve included $35 million for the Richton, Mississippi site, 
contingent on a report issued by the Department within 45 days. My 
staff has contacted yours about the report. What is the status of this 
report?
    Answer. Pursuant to the fiscal year 2009 Omnibus Appropriations Act 
(Public Law 111-8), a draft report assessing the effects of expansion 
of the Reserve on the domestic petroleum market is undergoing internal 
review. We will publish and submit the final report to Congress as soon 
as the review process has been completed.
                                 ______
                                 
           Questions Submitted by Senator George V. Voinovich

    Question. Over the last several years, the Department of Energy has 
greatly increased its oversight of the contractors responsible for 
managing and operating (M&O) the national laboratories under M&O 
contracts through prescriptive directives and requirements administered 
by overlapping and often redundant oversight organizations. Currently, 
the DOE's oversight organizations employ thousands of Federal staff 
with annual budgets of $500 million. Given that no other agency expends 
this amount of resources to oversee contractors who were supposedly 
engaged to apply best private-sector practices to operations, do you 
think the level of regulatory oversight at the Department's national 
laboratories has gotten out of control and hampers their ability to 
provide solutions to our Nation's pressing energy needs?
    Answer. As Secretary of Energy, I am firmly committed to improving 
efficiency at our Laboratories. There is much that the Department can 
and will do to enhance our laboratories' ability to deliver on the DOE 
missions. Significant improvement can be made with a concerted effort. 
Further, we will also review the use of independent certifications (ISO 
9000 and 14000, DOE Voluntary Protection Programs, etc.) as part of our 
expectations and our strategy for overseeing our contractors' business 
and operations systems and processes. Finally, we will consider the 
circumstances under which external regulation may be appropriate.
    Question. The Government-owned, contractor-operated (GOCO) model 
for laboratory management was originally designed to bring the best 
possible scientific and management talent to the laboratories and to 
allow them to apply the best private-sector business practices, thus 
maximizing their flexibility and efficiency. However, as laboratory 
resources are increasingly being redirected from performing R&D to 
demonstrating compliance with extremely prescriptive DOE work 
requirements, the argument for rethinking DOE's GOCO model is 
strengthened. What is your vision of the GOCO management relationship 
between DOE and its contractors?
    Answer. In my view, the proper relationship between the Department 
and its M&O contractors is one that focuses on clear definitions of 
performance expectations and outcomes and on holding our contractors 
accountable for achieving those outcomes.
    The success of the relationship between DOE and its M&O contractors 
depends on a clear and consistently-applied understanding of the roles 
and responsibilities of each party. The Department should specify what 
goals and requirements the contractors must meet and then hold the 
contractors accountable for meeting these goals. The contractors should 
determine how to meet those contract goals and requirements and apply 
best business practices.
    Question. How do you explain the current role of the local DOE 
site/field offices, and do you see this role changing over time?
    Answer. The current role of the local DOE site/field offices is to 
provide contractual support and oversight of the Department's national 
laboratories and other facilities that are Government-owned and 
contractor operated (GOCO). As you know, I am committed to improving 
the overall management of the Department, to make it more efficient, 
responsive, and economic in meeting our missions and better serving the 
American people. Toward this end I have already begun the process of 
reviewing the Department's current management structures, processes, 
and procedures, and would expect this to continue for some time.
    Question. In terms of execution of civilian R&D programs, how would 
you categorize the differences between the DOE Office of Science, 
National Science Foundation, and National Institute of Health?
    Answer. DOE is a mission agency with responsibilities in energy, 
environment, national security, and discovery science. The DOE Office 
of Science supports scientific research within this mission at over 300 
universities and the national laboratories. The Office of Science also 
plans, builds, and operates scientific user facilities for the 
scientific community. These facilities are a significant pillar of the 
U.S. scientific enterprise. The DOE Office of Science is the steward 
for 10 national laboratories, and it is the primary Federal supporter 
of basic research in service of the energy mission. The programs of the 
Office of Science are carefully planned and focused in areas of 
importance to advance the DOE mission.
    NIH is the primary Federal agency for conducting and supporting 
medical research. It is part of the Department of Health and Human 
Services, the principal agency for protecting the health of all 
Americans and providing essential human services. NIH employs 
intramural researchers and also funds extramural researchers. The DOE 
Office of Science generally does not directly fund medical science and 
does not have Federal intramural researchers.
    The National Science Foundation (NSF) aims ``to promote the 
progress of science; to advance the national health, prosperity, and 
welfare; to secure the national defense. . . .'' The NSF supports all 
fields of fundamental science and engineering, except for medical 
sciences, and also supports the social sciences.
    NSF is proposal-driven and funds science independent of the field 
or application of that science; in contrast the DOE Office of Science 
is mission-driven, supporting science serving the DOE missions of 
energy, environment, and national security.
    A cornerstone of Office of Science funding is a rigorous peer 
review process, much like NIH and NSF.
    Question. Although our national laboratory system includes what may 
be the largest and most impressive collection of scientific facilities 
and talent in the world, the American tax payer does not receive the 
maximum benefit from these investments because current DOE policy 
prevents labs from partnering with private companies on research 
proposals from Federal agencies. Would you support a change in current 
DOE policy to authorize national laboratories, on a non-exclusive 
basis, to partner with private industry on research request for 
proposals (RFPs)?
    Answer. Senator Voinovich, you raise an interesting issue as to how 
to best utilize our national laboratories, which for the most part are 
Government-owned contractor-operated and are Federally Funded Research 
and Development Centers (FFRDCs). Our national laboratories partner 
extensively with private industry through, for example, the Work for 
Others program, Cooperative Research and Development Agreements, 
licensing arrangements and user agreements. With respect to responding 
to RFPs, however, the Federal Acquisition Regulation, which applies on 
a Government-wide basis, requires that agencies sponsoring FFRDCs 
include in the sponsoring agreement a prohibition against the FFRDC's 
competing with any non-FFRDC concern in response to a Federal agency 
RFP. DOE's implementation of that requirement is set out in DOE Order 
481.1C stating that FFRDCs may not respond to RFPs that involve head-
to-head competition. This preclusion is based partly on the sanctioned 
special access to Government information that FFRDCs have that could 
put commercial competitors at a disadvantage. The Order goes on to 
permit, under certain circumstances, FFRDCs to respond to Broad Agency 
Announcements, financial assistance solicitations, Program Research and 
Development Announcements, and similar solicitations which do not 
result in head-to-head competition. I believe that the DOE should look 
carefully at improving opportunities for private industry to partner 
with DOE national laboratories.
    Question. Has the Department of Energy determined which energy 
sources will provide the most electricity with the lowest carbon-
emissions and smallest lifecycle footprint on the environment as a 
whole, including raw materials and land usage? Has the DOE done a 
comprehensive study to determine the effectiveness of U.S. energy 
subsidies, and if not, has the DOE determined which energy subsidies, 
if any, would result in the best return on investment for tax payers 
while meeting the President's GHG emissions targets?
    Answer. No, but the Department of Energy is continuing to develop 
and evaluate a portfolio of technologies with the lowest life-cycle 
costs and carbon footprint to meet the Nation's growing electricity 
demand.
    Numerous Federal programs operate today to help accelerate the 
deployment of greenhouse gas intensity-reducing technologies by 
providing various financial incentives, including direct subsidies. 
While these financial incentives are expected to reduce GHG emissions, 
they also incur costs to the U.S. Government. DOE is evaluating the 
economic and environmental effectiveness of energy subsidies. The 
Energy Information Administration did recently complete a study, 
``Federal Financial Interventions and Subsidies in Energy Markets,'' 
but this study does not calculate the return on investment in terms of 
GHG emissions reduction. The executive summary is available at: http://
www.eia.doe.gov/oiaf/servicerpt/subsidy2/pdf/execsum.pdf.
    Question. What is the Department of Energy doing to help expand the 
number of nuclear power plants we have in the United States and reduce 
our dependence on foreign energy sources? Will additional loan 
guarantee authority be given to allow industry to move forward?
    Answer. The Nuclear Power 2010 (NP2010) program was established to 
address the issues limiting deployment of new nuclear plants in the 
United States. The primary goal of the NP2010 program was to 
demonstrate the streamlined Federal regulatory processes governing the 
siting and construction of new, standardized nuclear plant designs. The 
NP2010 program has successfully met its objectives, and we await 
industry decisions to build the first new nuclear plants in more than 
30 years. The NP2010 program is requesting $20.0 million in fiscal year 
2010 to complete support of the NuStart New Nuclear Plant Licensing 
Demonstration project. This industry cost-shared project includes 
interactions with the Nuclear Regulatory Commission (NRC) to obtain the 
NuStart Construction and Operating License for the AP1000 advanced 
light water reactor design including meetings with the Advisory 
Committee on Reactor Safety, issuance of Final Safety Evaluation 
Reports and Final Environmental Impact Statements and initiation of 
hearings by the Advisory Committee on Reactor Safeguards.
    Taken together, the NP2010 program and loan guarantees for nuclear 
power projects are designed to address the technical, regulatory and 
financial risks associated with deploying new nuclear plants. DOE is 
not seeking additional loan guarantee authority or additional 
appropriations for credit subsidy costs in fiscal year 2010.
    Question. What initiatives and programs is the Department of Energy 
planning to ensure we have the technical workforce required to 
maintain, build and service our Nation's nuclear power plants in a safe 
and efficient manner?
    Answer. The Office of Nuclear Energy will provide $2.9 million in 
undergraduate scholarships and graduate fellowships to high-quality 
undergraduate and graduate students going into nuclear science and 
engineering disciplines at universities and colleges located in the 
United States. The Office of Nuclear Energy also has recommended that 
29 universities and colleges receive a total of $6 million in grants 
for new equipment and instrumentation for their existing research 
reactors, for other specialized nuclear science and engineering 
facilities, and to establish classrooms and laboratories. These grants 
are designed to enhance the universities' and colleges' nuclear energy 
research and development capabilities to educate the next generation of 
nuclear engineers and scientists.
    Working with industry, the Office of Nuclear Energy will soon begin 
activities to more thoroughly analyze total workforce needs to support 
continued safe and reliable operation of the existing nuclear fleet and 
construction and operation of the next generation of nuclear power 
plants in the United States. Finally, the Department will continue to 
look for partnership opportunities with industry groups, academia, and 
other Government agencies to ensure an adequate, highly skilled 
workforce is available to ensure continued safe and reliable nuclear 
power operations.

                          SUBCOMMITTEE RECESS

    Senator Dorgan. Thank you for being with us this morning. 
Our subcommittee will want to work closely with you and with 
your staff in the Department of Energy as we work through the 
markup of an appropriations bill going forward in the coming 
fiscal year. This hearing is recessed.
    [Whereupon, at 11:54 a.m., Tuesday, May 19, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2010

                              ----------                              


                         TUESDAY, JUNE 2, 2009

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:18 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Byron L. Dorgan (chairman) 
presiding.
    Present: Senator Dorgan, Feinstein, and Bennett.

                          DEPARTMENT OF ENERGY

                National Nuclear Security Administration

STATEMENT OF HON. THOMAS P. D'AGOSTINO, UNDER SECRETARY 
            FOR NUCLEAR SECURITY AND ADMINISTRATOR
ACCOMPANIED BY:
        BRIGADIER GENERAL GARRETT HARENCAK, PRINCIPAL ASSISTANT DEPUTY 
            ADMINISTRATOR FOR MILITARY APPLICATION, OFFICE OF DEFENSE 
            PROGRAMS
        KEN BAKER, PRINCIPAL ASSISTANT DEPUTY ADMINISTRATOR FOR DEFENSE 
            NUCLEAR NONPROLIFERATION

              OPENING STATEMENT OF SENATOR BYRON L. DORGAN

    Senator Dorgan. We will call the hearing to order. This is 
the Senate Appropriations Committee Subcommittee on Energy and 
Water Development.
    We appreciate all of you being here. I apologize for being 
just a bit tardy this morning.
    We are here to take testimony from Administrator Thomas 
D'Agostino of the Department of Energy's National Nuclear 
Security Administration on the fiscal year 2010 budget request.
    Joining Mr. D'Agostino at the witness table to help field 
questions will be the two NNSA Principal Assistant Deputy 
Administrators, Brigadier General Harencak--I hope I have that 
correct, Brigadier General. Welcome to you. And Mr. Ken Baker, 
Mr. Baker, welcome.
    This year's budget request of $9.9 billion for the NNSA is 
up $815 million, or almost 9 percent, when compared to the 
fiscal year 2009 appropriation. But almost $600 million of that 
increase is simply a transfer of the MOX fabrication facility 
construction project to NNSA. Excluding that shift, NNSA's 
budget is flat in fiscal year 2010, with only a tangible 
increase in the Naval Reactors Program.
    As we have seen in other parts of the Department of 
Energy's budget request, there are very few positive changes in 
the NNSA budget from fiscal year 2009 to fiscal year 2010. In 
fact, there are numerous program areas where the exact same 
number is requested in fiscal year 2010 as was requested the 
previous fiscal year. Whether it is a weapons program budget or 
the fossil energy program budget, it is hard to imagine that so 
little is truly in need of change over the coming year, and I 
assume we will talk about that this morning.
    I understand that the Nuclear Posture Review is currently 
underway and that this will have an impact on our stockpile and 
perhaps on the complex that supports the stockpile. However, I 
am not sure this is justification enough for decisions to halt 
some of the projects or for the lack of actual positive changes 
in the budget request. The fact is NNSA is going to have a very 
active future. That is clear when looking at the wide number of 
areas that we will discuss today.
    Through renegotiation of the START Treaty and completion of 
the NPR, we are likely to be on a path to fewer nuclear weapons 
in our stockpile. This will require more dismantlement. That 
requires more funding. However, we will continue to have 
nuclear weapons for the near future, and that, too, requires 
funding for stewardship and life extension programs.
    Also, the President announced in April his goal of securing 
vulnerable nuclear material around the world within 4 years. 
That is a very critical issue that we must address 
aggressively, and that, too, will cost some funding.
    Further, whether because of new treaties or actions by 
North Korea and others, proliferation and nuclear detection are 
becoming much more prominent as issues and are also critical 
issues and, once again, require funding. All of these areas 
require resources. A flat fiscal year 2010 budget means 
additional pressures, it seems to me, in the out-years, and 
that is something we will discuss this morning.
    I want to make one final point. The weapons program is 
primarily focused on issues directly related to the stockpile. 
But the fact is, a significant infrastructure funded by the 
weapons programs also benefits other programs, such as science 
and non-proliferation, both of which are important. The NNSA's 
computing program has led this Nation to the forefront of 
computing worldwide.
    I know that the announcement about that, that we have 
computing capabilities now that are not exceeded anywhere in 
the world, was made with great pride and that was done at our 
weapons lab. The program not only serves stockpile modeling, 
but also climate change, non-proliferation modeling, and more.
    NNSA computer modeling has contributed significantly to the 
Intergovernmental Panel on Climate Change. Their non-
proliferation program uses computer modeling to better analyze 
seismic events related to detonation. This fact, I think, seems 
forgotten in the budget request.
    The NNSA's investment in supercomputing has dropped 7 
percent since 2006. By comparison, the Department of Energy's 
Office of Science computing budget has increased 79 percent 
over the same period.
    So we are in a political transition year. The stockpile 
still requires attention. Proliferation is an ever-increasing 
concern, and base capabilities still need to be maintained or 
increased. A flat budget is going to make that a very 
significant struggle.
    I understand, Mr. D'Agostino that you are not ultimately 
responsible for this budget request, but you have, nonetheless, 
come here to answer questions about it. We have seen the Office 
of Management and Budget passbacks that make it clear that OMB 
has significant control in this area. Although this may not 
reflect all of your views on all accounts, we will rely on you 
to explain it today.
    I have always appreciated your candor and appreciated 
working with you, Mr. D'Agostino. I am going to call on Senator 
Bennett for an opening comment. I do want to mention that we 
apparently will have either one or two votes, starting at 11 
o'clock today, and we will recess for that purpose.
    Senator Bennett.

             OPENING STATEMENT OF SENATOR ROBERT F. BENNETT

    Senator Bennett. Thank you very much, Mr. Chairman.
    And most of the items that I intended to cover in my 
opening statement you have already covered. The budget is flat, 
and it is flat in a number of areas that, as you have outlined, 
need to be looked at and improved. It is reduced--this budget 
has reduced science funding and non-proliferation R&D by 
several hundred million dollars. And future funding will 
continue to erode the capability over time. I find that a very 
disturbing trend.
    I have always been willing to fund R&D, particularly the 
kind of pure science that we see in the national labs, and your 
description of the computing power and other things is an 
accurate portrayal of the challenge that we face.
    I support sustaining the test ban moratorium. But if we are 
going to do that, we have to have a significant investment in 
our scientific capabilities and the people and the 
infrastructure that go along to ensure those capabilities so 
that we can accurately predict the status of our nuclear 
deterrent. And I don't believe the budget provides adequate 
funding for the scientific capabilities and falls short in the 
areas you have described.
    So I look forward to working with you, Mr. Chairman, to try 
to repair this damage that has come. And Mr. D'Agostino, I have 
been sitting at the same table where you are in previous 
administrations, and I know the frustrations of making a 
submission to OMB and being told no less how much you are going 
to defend when you get to Congress. And we don't ask you to 
violate your instructions from OMB, but any degree of candor 
you can share with us would be very much appreciated.
    Senator Dorgan. Senator Bennett, thank you.
    We will try to get the sound system fixed here, get it 
turned up just a bit so the audience can hear.
    Senator Feinstein, would you like to make a brief opening 
comment, and then we will go to Mr. D'Agostino?

                 STATEMENT OF SENATOR DIANNE FEINSTEIN

    Senator Feinstein. Well, just one quick thing. I had the 
great pleasure--I guess it was Friday----
    Mr. D'Agostino. Yes, ma'am.
    Senator Feinstein [continuing]. Friday, of being at 
Lawrence Livermore to see the beginning--and Mr. D'Agostino was 
one of the speakers. And to see the beginning of the National 
Ignition Facility, which you have been helpful with, both of 
you, over the years. It has been somewhat controversial, but 
the conversation was so exciting, and that is that it may be 
possible--``may'' is the operative word--to combine fission and 
fusion to really be able to present a brand-new source of 
energy, which not only would be cost effective, but would be 
carbon free.
    And it would appear, and I hope--the reason I wanted to 
come was to ask you more about this--that this might well be 
the new mission of that lab. And I will just end it. I have 
watched the labs and really come to wonder if the right thing 
was done in the privatization of these labs because we have 
lost a lot of valued employees. And the labs are only good if 
they have a mission, and the mission has changed. So I want to 
talk about that a little bit later on.
    But thank you very much.
    Senator Dorgan. Senator Feinstein, thank you very much.
    Mr. D'Agostino, I just alluded to the announcement about 
the Roadrunner, I believe, at Los Alamos, the most powerful 
computer in the world. We have great accomplishment at our 
weapons labs, not dealing just exclusively with weapons. One of 
my concerns is given the changing of the nature of the Bell 
Labs over the years and so on, our national laboratories are 
critically important to this country continuing its edge in 
science and research and technology.
    I am very worried about losing the strength of our 
scientists at these laboratories. We need to continue funding, 
and there are many things that can be done in the weapons labs 
and the science labs that can advance this country's interests. 
I worry very much about diminished funding and losing some of 
our best and most capable people.

                 STATEMENT OF HON. THOMAS P. D'AGOSTINO

    So let me call on you for an opening statement, and then we 
will begin with questions.
    Mr. D'Agostino. Well, thanks very much, Chairman Dorgan, 
and Senator Bennett, Senator Feinstein.
    As you know, I am Tom D'Agostino. I am the Administrator 
here at the National Nuclear Security Administration. I am 
accompanied by Ken Baker, who runs our non-proliferation 
program, and Brigadier General Gary Harencak, who runs our 
defense programs activities and is responsible for maintaining 
the base capability on nuclear security for our program. And we 
do appreciate the opportunity to be here today and to talk to 
you about our programs and to answer your questions.
    Also, in the audience, we have some members of our summer 
student intern program. These are the folks, ultimately, I 
wanted them to come and see the process at work, the way 
Government works. These are the folks that will be leading 
these types of security programs out in the future. We are 
really proud, fortunate to have them here, and it is exciting 
to have young folks in the organization to see what we do and 
to capture, get a little bit of that vision that we saw at the 
National Ignition Facility, get excited about the programs, and 
take us forward. So I'm excited about that.
    As you know, we believe NNSA is critical to the security of 
the United States and our allies. The President's fiscal year 
2010 budget request is $9.9 billion. It is an increase, as you 
said, sir, of about 8.9 percent over the fiscal year 2009 
appropriated level. The budget request provides funding to 
enable the NNSA to leverage science, to promote U.S. national 
security objectives.
    NNSA programs are on the front of the lines of the 
following national security endeavors: maintaining a safe, 
secure, and reliable stockpile and capabilities to support that 
stockpile; accelerating and expanding our efforts here and 
around the world to reduce the global threat posed by nuclear 
terrorism, nuclear proliferation, and unsecured materials; 
providing the United States Navy with safe, militarily 
effective propulsion systems; and supporting U.S. leadership in 
science and technology.
    As the President has initiated bold steps to put an end to 
cold war thinking to lead to a new international effort to 
enhance global security, the 2010 budget request for NNSA is 
the first step. There are other steps, but this is the first 
step towards implementation of this new strategy.
    For our non-proliferation programs, funding increases are 
requested to expand and respond quickly to opportunities to 
reduce global nuclear threats. Increases are also requested, as 
you said, sir, in the Naval Reactors Program to begin 
development of reactor and propulsion systems for the next-
generation submarine, among other activities.
    For the programs in our weapons activities appropriation, 
the budget strategy is to maintain capabilities and activities 
at the current level until the strategic direction is 
established in the upcoming Nuclear Posture Review.
    In President Obama's speech in Prague, he indicated his 
commitment to maintaining a safe, secure, and reliable 
stockpile while pursuing a vision of a world free from the 
threat of nuclear weapons. The NNSA maintains the unique 
knowledge and technical capabilities that are critical to 
achieving both of these objectives.
    Our non-proliferation programs are focused on securing the 
key ingredient of nuclear weapons, in effect, the weapons 
usable materials and the related equipment and technologies. 
Supporting NNSA efforts include the Elimination of Weapons-
Grade Plutonium Production Program, which has been working with 
Russia to shut down Russia's plutonium production reactors, and 
the Fissile Material Disposition Program, which will provide a 
disposition path of 34 metric tons each of U.S. and Russian 
excess plutonium.
    The NNSA is a recognized leader on these and other non-
proliferation initiatives to prevent proliferators or 
terrorists from acquiring a nuclear weapon. This includes our 
activities to secure and reduce weapons-grade nuclear materials 
at sites worldwide, but also our efforts to detect and 
intercept WMD-related materials in transit.
    In addition, we will also work in 2010 to support the 
President's call to strengthen the Non-Proliferation Treaty, 
support the International Atomic Energy Agency, and strengthen 
international safeguards inspections. To implement this 
comprehensive strategy, we will need to expand our cooperation 
with Russia, pursue new partnerships, and work to secure 
vulnerable nuclear material around the world in 4 years.
    Our Global Threat Reduction Initiative and the 
International Material Protection and Cooperation Programs will 
have a major role in this 4-year plan.
    NNSA is actively participating in a national debate over 
our Nation's nuclear security and non-proliferation strategic 
framework. This debate is not just about the size of the 
stockpile and warheads. It includes the inescapable obligation 
to transform our current cold war era nuclear weapons complex 
into a 21st century nuclear security enterprise that retains 
the capabilities necessary to meet emerging national security 
threats.
    In a future with fewer warheads, no nuclear tests, tighter 
controls on materials worldwide, and effective counteraction of 
nuclear terrorist threats, the science and technology 
capabilities will play an increased role, not decreased role, 
in addressing these challenges. We must ensure that our 
evolving strategic posture and our stockpile, non-proliferation 
programs, arms control, and counterterrorism programs are 
melded together in an integrated, comprehensive strategy to 
protect our country and our allies.
    The Department of Defense, as you know, has initiated this 
Nuclear Posture Review, which is scheduled to culminate in a 
report later this year. I want to assure the subcommittee that 
we are active members of that review and we are making sure 
that science and technology that underpins essential policy 
decisions is part of that review.
    As you know, we have made tremendous progress in reducing 
the size of our stockpile in recent years. The stockpile will 
now be less than one quarter of what it was at the end of the 
cold war, the smallest stockpile in 50 years. These reductions 
send the right message to the rest of the world that the United 
States is committed to Article 6 of the Non-Proliferation 
Treaty, which will help create a positive momentum heading into 
the 2010 NPT review conference.
    Each year since the Stockpile Stewardship Program was 
developed, we have been able to certify the safety, security, 
and reliability of the stockpile with no need to conduct 
underground tests. Since 1993, we have acquired a suite of 
capabilities determined necessary to maintain an effective 
stockpile.
    Most recently, as Senator Feinstein has mentioned, the 
National Ignition Facility has come online, and ultimately, we 
are going to be--our goal in the next few years is to actually 
apply these tools to address not only the national security 
problems but maintain the science that we need and to look for 
other opportunities to address our energy issues out into the 
future.
    But the challenge for stockpile stewardship in the future 
ultimately is to really make full use of this suite of tools. 
Following completion of the Nuclear Posture Review, we will 
prepare a 5-year plan, which recapitalizes our infrastructure, 
retains our scientific, technical, and engineering expertise, 
and makes full use of our experiments and supercomputing 
facilities.
    As the subcommittee knows, numerous external reviews have 
identified the fragile state of our technical expertise and 
capabilities, and it ultimately resides in our people. It is 
clear that our people are our most important resource. We need 
to retain those skills and capabilities and develop the next 
generation of scientists, engineers, and technicians needed to 
perform work in non-proliferation, in counterterrorism, and in 
forensics.
    Of course, we need to maintain--these are the same people 
that are responsible for maintaining our stockpile.
    Mr. Chairman and members of the subcommittee, that 
concludes my statement, and I will be pleased and look forward 
to taking your questions.
    [The statement follows:]

            Prepared Statement of Hon. Thomas P. D'Agostino

    Thank you for the opportunity to discuss our vision for the 
National Nuclear Security Administration. My remarks today focus on the 
fiscal year 2010 President's budget request. The budget requested today 
will allow the National Nuclear Security Administration to continue to 
achieve the mission expected of it by the President, the Congress, and 
the American people.
    In a recent trip to Prague, President Obama outlined his vision of 
a world without nuclear weapons. To this end, the United States will 
take concrete steps towards achieving such a world by reducing the role 
of nuclear weapons in our national security strategy and urging others 
to do the same. Until that ultimate goal is achieved, however, the 
United States will maintain nuclear forces sufficient to deter any 
adversary, and guarantee that defense to our allies. To support this 
vision, the National Nuclear Security Administration (NNSA) will 
continue to:
  --Ensure a safe, secure, reliable and effective nuclear weapons 
        stockpile, even if that stockpile is reduced under a START 
        Follow-On Treaty.
  --Reduce the threat to the United States posed by the proliferation 
        of nuclear weapons, and related nuclear materials and 
        expertise.
  --Provide safe, reliable, militarily-effective propulsion systems to 
        the U.S. Navy.
    By pursuing its mission to achieve these ends, and by providing our 
unique knowledge and support to our partners in national security, the 
NNSA will continue to meet its current statutory responsibilities while 
supporting the long-term goal of a world free from the threat of 
nuclear weapons.
    While the President's long-term objectives are clear, the role of 
the nuclear weapons stockpile and America's deterrence policy are being 
reviewed as part of the ongoing Nuclear Posture Review. Efforts are 
underway in the NPR to establish the size and composition of the future 
stockpile and the means for managing geopolitical or technical risk--
NNSA is fully engaged in these activities. Its role is to provide the 
technical and scientific input to inform policy decisions, and then to 
enable the implementation of the decisions.
    NNSA is advancing our knowledge of the physical; chemical, and 
materials processes that govern nuclear weapons operation and is 
applying that knowledge in extending the life of existing weapons 
systems. We have recently completed construction of the National 
Ignition Facility at the Lawrence Livermore National Laboratory (LLNL) 
to explore weapons-critical regimes of high temperature and pressure 
and will begin our first ignition campaign to improve our scientific 
understanding of phenomena that could previously only be explored 
theoretically or in full-scale nuclear testing. The NNSA is also 
conducting warhead Life Extension Programs to ensure that our country 
remains secure without the production of new fissile materials, and 
without conducting underground nuclear tests. On the basis of the most 
recent assessment by the Directors of our national nuclear weapon 
laboratories, today's nuclear stockpile remains safe, reliable, and 
secure. At the same time, we are concerned about increasing challenges 
in maintaining, for the long term, the safety and reliability of the 
aging, finely-tuned warheads that were produced in the 1970's and 
1980's and are well past their original planned service life.
    I am committed to continuing to transform our national laboratories 
and production plants into a smaller and more cost-effective Nuclear 
Security Enterprise. However, I am mindful that our design laboratories 
and production facilities are national assets that support a large 
number of defense, security, and intelligence activities. As the role 
of nuclear weapons in our Nation's defense evolves and the threats to 
national security continue to grow, the focus of this enterprise must 
also change and place its tremendous intellectual capacity and unique 
facilities in the service of addressing other challenges related to 
national defense. We are taking steps to move in this direction, 
including functioning as a national science, technology, and systems 
engineering resource to other agencies with national security 
responsibilities.
    The NNSA fiscal year 2010 congressional budget request will allow 
continued progress in obtaining the essential goals I have outlined. It 
will allow us to:
  --Continue transforming into a Nuclear Security Enterprise by:
    --Involving the next generation of our Nation's scientific, 
            engineering, and technical professionals in the broad sweep 
            of technical challenges;
    --Operating the National Ignition Facility, allowing the use of 
            innovative technology to provide answers to important 
            scientific questions;
    --Shrinking the cold war complex by preparing buildings for 
            decommissioning and decontamination, and replacing these 
            antiquated facilities with modern and efficient facilities; 
            as well as disposing of excess real property through 
            demolition, transfer and the preparation of process-
            contaminated facilities for transfer to the Department of 
            Energy (DOE) Office of Environmental Management (EM) for 
            final disposition;
    --Initiating a Site Stewardship program to ensure that NNSA 
            increases the use of renewable and efficient energy, and 
            reduces the number of locations with security Category I/II 
            Special Nuclear Materials, including the removal of these 
            materials from the Lawrence Livermore National Laboratory 
            by the end of 2012; and
    --Reducing security, safety and environmental risks by 
            consolidating and disposing of excess nuclear materials 
            wherever possible.
  --Support the development and implementation of arms control, 
        nonproliferation, and civil nuclear energy agreements by:
    --Providing technical and policy support to U.S. delegations 
            negotiating arms control, nonproliferation, and peaceful 
            nuclear energy cooperation agreements;
    --Developing the technologies and approaches needed to verify 
            compliance with negotiated treaties and agreements; and
    --Providing training and technical support to the International 
            Atomic Energy Agency.
  --Support U.S. commitments through construction of the Mixed Oxide 
        Fuel Fabrication Facility and Waste Solidification Building to 
        provide a disposition pathway for excess U.S. fissile 
        materials, and to help Russia implement its reciprocal 
        commitments.
  --Continue our successful programs to secure and/or eliminate 
        vulnerable nuclear and radioactive material in other countries, 
        enhance nuclear/radiological material detection capabilities at 
        borders, airports, and seaports, and strengthen 
        nonproliferation practices and standards worldwide.
  --Embark on the design and development of an advanced reactor core 
        and propulsion plant supporting the timely replacement of the 
        OHIO Class Submarine.
  --Overhaul of the land-based prototype reactor plant used to test 
        advanced materials and techniques in a realistic operating 
        environment prior to their inclusion in propulsion plants.
  --Honor the commitments made to those who won the cold war by 
        ensuring their pensions are secure in times of financial 
        uncertainty.
    Today, I'd like to testify on our efforts in Weapons Activities, 

Defense Nuclear Nonproliferation, and Naval Reactors.

                      WEAPONS ACTIVITIES OVERVIEW

    The NNSA will ensure that our nuclear stockpile remains safe, 
secure and effective to deter any adversary, and provide a defense 
umbrella to our allies. At the same time, NNSA will continue to pursue 
a modern more flexible Nuclear Security Enterprise that is 
significantly smaller than the Cold War complex, but is able to address 
a variety of stockpile scenarios.
    As I have committed to you previously, NNSA continues to retire and 
dismantle nuclear weapons. By 2012 our stockpile will be one-quarter of 
the size it was at the end of the cold war. As the United States 
prepares for the 2010 Review Conference of the Nuclear Non-
Proliferation Treaty, this fact alone should emphasize the commitment 
we make to both our Nation and to the world.
    As a full partner in the Nuclear Posture Review, the NNSA is 
working with the Departments of Defense and State to establish the 
plans, policies, and programs that will govern the future posture of 
our nuclear forces and supporting infrastructure. The recently issued 
report of the Bipartisan Congressional Commission on the Strategic 
Posture of the United States will help guide these efforts. These 
reviews will assist the U.S. Congress and the administration in clearly 
defining our future direction.
    As the NPR proceeds, NNSA continues to carry out a number of 
activities in support of the stockpile including warhead surveillance, 
assessment, replacement of limited life components in existing weapon 
systems, and dismantlements. We are also continuing the W76 Life 
Extension Program and a feasibility study with the Air Force for a Life 
Extension Program for some models of the B61 gravity bomb. There are 
also activities planned in the six campaigns and the studies needed for 
Annual Assessment of the stockpile.
    The NNSA will also continue transforming the Nuclear Security 
Enterprise into a modern, smaller, and more flexible complex. The NNSA 
inherited a system of laboratories and production plants designed to 
produce large volumes of weapons and designs needed to counter Soviet 
aggression. We have initiated a major effort to right-size the 
enterprise to meet the new, anticipated requirements. The NNSA is 
consolidating Category I and II Special Nuclear Materials; removing 
these items from selected sites and providing safe, secure storage for 
this material.
    In fiscal year 2010, we will be reducing our infrastructure 
footprint through the deactivation and decommissioning of buildings 
such as Buildings 9206 and 9201 at Y-12. We will also plan for the 
future infrastructure through continuing design of the Uranium 
Processing Facility at Y-12, the Pit Disassembly and Conversion 
Facility at the Savannah River Site, and the Chemistry and Metallurgy 
Research Replacement Facility at the Los Alamos National Laboratory, 
and begin the process of planning for an orderly migration of missions 
to a smaller and more flexible facility at the Kansas City Plant.
    The NNSA has received assistance in our ability to alter our 
infrastructure in the form of an increase in the General Plant Projects 
limit. We are pleased with the decision to increase the ceiling on 
General Plant Projects from $5 million to $10 million. We believe that 
this aids in the maintenance and repair of the enduring enterprise. 
Following on this increase, the NNSA is submitting a legislative 
proposal to similarly increase the design cost limit for these 
construction projects from $600,000 to $1,500,000. We seek your support 
for the proposal.
    But while NNSA is reducing its footprint, and while the total 
number of warheads in the stockpile continues to decline, there are 
capabilities that must be preserved. Not only are these capabilities 
needed to support the maintenance of any stockpile, but they are also 
needed to support the Nuclear Security Enterprise's initiatives in 
nonproliferation, nuclear counterterrorism, nuclear forensics, and 
nuclear incident response. It's important to note that the enterprise 
does not scale linearly with the size of the stockpile; and the need 
for baseline functional capabilities is not eliminated with cessation 
of research into new designs and the cessation of any production of new 
weapons systems. These capabilities are needed whether we have a few 
warheads, or a few thousand.
    Although NNSA did not receive any funds directly from the American 
Recovery and Reinvestment Act, we are assisting other parts of the 
Department in implementing their plans for stimulus work at the NNSA 
sites and stand ready to do more.
    As NNSA prepares for the future, we must focus on the retention of 
our scientific, technical, and engineering personnel throughout the 
complex. Without experienced scientific, technical, and engineering 
personnel, NNSA cannot succeed at its mission. Throughout the cold war 
we were able to attract the Nation's brightest scientists, engineers, 
and technical professionals by providing challenges, facilities, and 
opportunities that were unique, were on the forefront of science, and 
that allowed them to put their talents to work to serve their country. 
Today we are transitioning our emphasis to a broader nuclear security 
mission, but our need to attract the best scientists, engineers and 
technical professionals remains. By developing new scientific tools 
such as the National Ignition Facility, new challenges such as the 
detection of smuggled uranium and plutonium, and the modernization of 
facilities such as the Chemistry and Metallurgy Research Replacement 
Facility, we can continue to attract bright technical minds who wish to 
serve their country. We believe that our response to the spectrum of 
threats to national security is not only the right steps for us to take 
to make the Nation more secure, but also will provide a significant set 
of technical areas that will motivate young scientists to join us in 
our mission.
    The challenges are huge and meeting them calls upon both basic 
science and applied technology. Approximately 70 years ago, Hans Bethe 
advanced the state of science with his critical work explaining the 
physical processes governing the life cycles of stars. Today the 
National Ignition Facility (NIF) stands on the threshold of producing 
stellar conditions in the laboratory. By moving the enterprise forward 
in advancing the boundaries of science, we will continue to attract our 
Nation's brightest minds to our scientific endeavors. In fiscal year 
2009, two significant technological milestones were achieved; crossing 
the one mega joule threshold with NIF and the one petaflop threshold in 
the Advanced Simulation and Computing Campaign.

               DEFENSE NUCLEAR NONPROLIFERATION OVERVIEW

    As part of the President's comprehensive strategy to address the 
international nuclear threat, the President also called for 
strengthening the Nuclear Nonproliferation Treaty, accelerating our 
efforts to secure vulnerable nuclear materials around the world, and 
increasing our work to detect, deter, and eliminate illicit trafficking 
of nuclear materials. The NNSA Nuclear Security Enterprise is actively 
engaged in these and other nonproliferation missions and will provide 
the technical expertise to ensure they are successful.
    The movement of funding for the Mixed Oxide Fuel Fabrication 
Facility and the Waste Solidification Building into the Fissile 
Materials Disposition budget is the largest change in the fiscal year 
2010 Congressional Budget for Defense Nuclear Nonproliferation program. 
These critical facilities provide the nonproliferation programs a 
disposition pathway for at least 34 metric tons of surplus U.S. weapons 
grade plutonium. I'm pleased to report that the United States and 
Russia have agreed on a revised Russian program to dispose of Russia's 
34 metric tons of their surplus weapons plutonium. These changes will 
be codified in a Protocol that will amend the 2000 U.S.-Russian 
Plutonium Management and Disposition Agreement, and we expect to sign 
the Protocol this summer. In light of President Obama's recent 
statements in Prague and London, I am particularly pleased that the 
U.S. and Russian plutonium disposition programs are coming together at 
this time. As a result of these efforts, the United States and Russia 
will ultimately dispose of enough weapons plutonium for at least 17,000 
nuclear weapons.
    I should note also that with this budget request, we are submitting 
our last request for funding to eliminate the production of weapons-
grade plutonium production in Russia by December 2010, through the 
shutdown of Russia's last weapons-grade plutonium production reactor in 
Zheleznogorsk.
    The NNSA directly supports President Obama's goal to accelerate 
efforts to secure all vulnerable nuclear material from around the world 
within 4 years, including the expansion and acceleration of our 
existing efforts. The NNSA is the key agency supporting the 
administration's goal of minimizing the use of highly-enriched uranium 
(HEU) in the civil nuclear sector through our program to shutdown 
entirely or convert HEU fueled research reactors to the use of low-
enriched uranium (LEU) fuel. In fiscal year 2010, we will direct 
significant funding to the Global Threat Reduction Initiative (GTRI) 
mission to eliminate and protect vulnerable nuclear and radiological 
materials located at civilian sites worldwide.
    In fiscal year 2010, we will also improve the physical security of 
nuclear material, as well as facilitate the development and 
implementation of material control and accountability procedures, and 
train personnel, to protect a total of 73 nuclear sites throughout 
Russia and the former Soviet republics. The NNSA will fulfill the 
administration's goal of securing nuclear weapons-usable material by 
ensuring that the material possessed by the Russian Navy, the Russian 
Ministry of Defense, Rosatom and Russian civilian sites is secured.
    But improving the security of weapons-usable material at its source 
is only the start. We must also develop a Second Line of Defense in 
order to anticipate the possibility that nuclear weapons-usable 
material could be smuggled out and transported across international 
borders. And in fact, we know that illicit trafficking in nuclear and 
other radioactive materials continues, especially in Eastern Europe, 
the Caucasus, and Central Asia. In response to the President's charge 
to do more to combat nuclear trafficking, we will install additional 
radiation detection equipment at 42 foreign sites across Europe, Asia, 
and North America, and provide detection equipment in 15 additional 
ports where cargo is loaded for shipment to the United States.
    This work started several years ago. Technology advances and 
foreign personnel turnover have occurred since NNSA first began 
securing sites and borders in foreign countries. Funds will be used not 
only to perform new installations and train personnel at new sites, but 
will also be used to upgrade older equipment at existing sites, and to 
provide refresher training to foreign security professionals.
    Additionally, in fiscal year 2010, NNSA will expand and accelerate 
its Next Generation Safeguards Initiative (NGSI), adding $15 million to 
revitalize the U.S. technical and human capital base necessary to 
strengthen the international safeguards system and the International 
Atomic Energy Agency, in line with President Obama's charge in Prague. 
The NGSI complements related NNSA priorities to reduce proliferation 
risks associated with growing international interest in the use of 
nuclear power; to expand export control training and outreach; to 
develop and implement reliable fuel services as an alternative to the 
further spread of enrichment and reprocessing capabilities; and--
consistent with the President's call for progress towards a world 
without nuclear weapons--to provide technical support for negotiations 
of the START follow-on agreement, Comprehensive Nuclear Test-Ban 
Treaty, and a verifiable Fissile Material Cutoff Treaty.

                        NAVAL REACTORS OVERVIEW

    The NNSA also contributes to national security through the Naval 
Reactors Program. This program ensures that the nuclear propulsion 
plants aboard our Navy's warships remain safe and reliable for their 
complete service lives. Over 40 percent of the Navy's major combatants 
are nuclear-powered. All of the Nation's aircraft carriers, attack 
submarines, guided missile submarines, and ballistic missile submarines 
enjoy the significant operational advantage afforded by nuclear power, 
including speed, endurance, and enhanced combat payload. Through NNSAs 
efforts, nuclear-powered warships are on station where American 
interests are threatened, and ready to conduct sustained combat 
operations.
    For over 60 years, the Naval Reactors program has had complete 
responsibility for all aspects of Naval Nuclear Propulsion. The Naval 
Nuclear Propulsion Program currently supports 82 active nuclear-powered 
warships and 103 operating reactors. This represents 8 propulsion plant 
designs, in seven classes of ships, as well as a training platform.
    Naval Reactors funding supports safe and reliable operation of the 
Nation's Nuclear Fleet. This includes providing rigorous oversight, 
analysis of plant performance and conditions, as well as addressing 
emergent operational issues and technology obsolescence for 71 
submarines, 11 aircraft carriers and four research and development and 
training platforms. This funding also supports new plant design 
projects (i.e., reactor plant for the GERALD R. FORD-class aircraft 
carrier and alternative lower-cost core for VIRGINIA-class submarines), 
as well as ensuring proper storage of naval spent nuclear fuel, prudent 
recapitalization of aging facilities, and remediation of environmental 
liabilities.
    The OHIO-class SSBNs, which are the most survivable leg of the U.S. 
Strategic Forces, are approaching the end of their service lives. The 
Navy recently completed studies for a follow-on replacement to the 
OHIO-class and is funding the commencement of design work in fiscal 
year 2010. NNSA funding in fiscal year 2010 supports reactor core and 
propulsion plant design and development efforts to support this 
replacement.
    Since 1978, the land-based prototype reactor plant (S8G) has 
provided an essential capability to test required changes or 
improvements to components and systems prior to installation in 
operational ships. The prototype has also provided required, high-
quality training for new sailors preparing to operate the Nation's 
nuclear-powered vessels. This land-based prototype will run out of fuel 
and require a refueling overhaul starting in 2018. This overhaul and 
the resultant opportunity to test advanced materials and manufacturing 
techniques in a caustic operating environment will significantly 
mitigate risk in the OHIO Replacement reactor plant design. To support 
the refueling overhaul schedule, concept studies and systems design and 
development efforts will begin in 2010.
    The Expended Core Facility, located at the Naval Reactors Facility 
on the Idaho National Laboratory, is the central location for Naval 
spent nuclear fuel receipt, inspection, dissection, packaging for dry 
storage, and temporary storage, as well as detailed examination of 
spent cores and irradiation specimens. Continuous, efficient operation 
of this facility is vital to ensure the United States can support fuel 
handling operations in our shipyards conducting construction, repair, 
and restoration of nuclear ships. The existing facility and related 
infrastructure is over 50 years old and requires recapitalization. The 
mission need for recapitalizing this capability has been approved and 
conceptual design efforts begin in 2010.
    The Program continues to explore and develop potentially advanced 
technologies that could deliver a compellingly better energy source for 
nuclear ships. For example, using a supercritical carbon dioxide energy 
conversion as a replacement for the traditional steam cycle is 
envisioned to be significantly smaller for the same power output, 
simpler, more automated, and more affordable. Leveraging existing 
university, industry, and Nuclear Security Enterprise scientific and 
engineering work in this technology, conceptual development and small-
scale testing is underway to support eventual megawatt-scale testing 
and prototyping.
    Acquisition of a new surface combatant (i.e., cruiser) in support 
of new ballistic missile defense and anti-air warfare mission 
requirements are currently under evaluation by the Navy. Based on these 
mission requirements, this new ship will potentially require higher 
energy capacity and output than is currently available from traditional 
fossil fueled power plants. Further, the National Defense Authorization 
Act (NDAA) for 2008 authorizes the Navy to construct all future major 
combatant vessels with integrated nuclear power systems unless this 
requirement is waived by the Secretary of Defense. The Navy is 
currently analyzing alternative shipboard systems that will determine 
final power plant requirements. Should the Navy decide to pursue a 
nuclear-powered cruiser in its current long-range shipbuilding plan, 
DOE-cognizant reactor core and propulsion plant design and development 
will be required.
    The value of nuclear power for naval propulsion is well recognized 
and the demand for its inherent capabilities remains strong. By taking 
every opportunity for economies in our work and business practices, we 
have made a concerted effort to meet the Navy's demand for new 
propulsion plant designs while assuring the safe and reliable operation 
and maintenance of the existing fleet. However, the need to deal with a 
formidable collection of new challenges coupled with the Program's 
aging infrastructure and environmental legacies requires a fortified 
level of resource commitment.
NNSA Future-Years Nuclear Security Program
    The NNSA fiscal year 2010 congressional budget request is $9.9 
billion, a total of $815.4 million above the fiscal year 2009 
appropriations. Of the 8.9 percent increase, about 7 percent is 
attributable to the re-location of funding for the Mixed Oxide Fuel 
Fabrication facility project back to NNSA in the Defense nuclear 
Nonproliferation appropriation.
    The NNSA budget justification contains information for 5 years as 
required by section 3253 of Public Law 106-065, entitled Future-Years 
Nuclear Security Program (FYNSP). The fiscal year 2010-2014 FYNSP 
projects $50.4 billion for NNSA programs through 2014. The principal 
increases from the fiscal year 2009-2013 FYNSP are: the transfer of 
funding for the Mixed Oxide (MOX) Fuel Fabrication Facility project 
back from the Office of Nuclear Energy to NNSA; the multi-year 
initiative to further enhance global nuclear nonproliferation efforts; 
and some of the increase required to support the development of the new 
generation submarine reactor replacement. For Weapons Activities, the 
outyear projections reflect only a continuation of current 
capabilities, pending upcoming strategic nuclear policy decisions. The 
fiscal year 2011-2015 budget process is expected to present a fully 
integrated Future Years Nuclear Security Program budget aligned with 
the new strategic direction and program requirements for all of the 
NNSA programs.
NNSA Budget Summary by Appropriation and Program
            Weapons Activities Appropriation
    The Weapons Activities appropriation funds five NNSA program 
organizations. (There are six subheadings below. Combining ``Site 
Stewardship'' and ``Infrastructure and Environment'' would reduce the 
count to five and mirror the NNSA structure.) The fiscal year 2010 
congressional budget request is $6.4 billion for Weapons Activities, 
essentially level with fiscal year 2009 appropriation.
            Defense Programs
    The fiscal year 2010 congressional budget request for Defense 
Programs is $5.0 billion, a decrease of 1.1 percent from the fiscal 
year 2009 appropriation that is primarily attributable to transitioning 
the Pit Disassembly and Conversion Facility and the Waste 
Solidification Building to other programs. The outyear projections for 
Defense Programs reflect a continuation of current programs and 
services pending further national nuclear policy direction expected 
during 2009.
    Within the President's Budget request level, the NNSA will continue 
all programs to meet the immediate needs of the stockpile, stockpile 
surveillance, annual assessment, and Life Extension Programs (LEP). As 
directed by the Nuclear Weapons Council, a feasibility and cost study 
was initiated in September, 2008, to investigate the replacement of 
aging non-nuclear components in the family of B61 bombs, and to study 
the potential incorporation of modern safety and security features in 
these systems. Included in the program are efforts to complete the B61 
Phase 6.2/6.2A refurbishment study evaluating end-of-life components, 
aging, reliability, and surety improvement options. The decrease within 
the Directed Stockpile Work (DSW) request is attributable mainly to the 
relocation of the funding for the Pit Disassembly and Conversion 
Facility (PDCF) to Readiness in Technical Base and Facilities (RTBF) 
and the Waste Solidification Building (WSB) to Defense Nuclear 
Nonproliferation.
    The Campaign activities for Science, Engineering, Inertial 
Confinement Fusion and Advanced Simulation and Computing maintain the 
fiscal year 2009 funding level throughout the FYNSP. The Science 
Campaign consolidates a new subprogram called ``Academic Alliances'' 
that encompasses the funding for university grants, alliances, and the 
joint program with Science. The Engineering campaign increases emphasis 
on Enhanced Surveillance and Systems Engineering Technology in the 
fiscal year 2010 congressional budget request. The Inertial Confinement 
Fusion Ignition and High Yield Campaign is requested at $437 million, 
and in fiscal year 2010, the emphasis shifts away from NIF assembly and 
toward Facility Operations as the program continues to refine 
requirements and prepare for the first ignition experiments in 2010. 
The fiscal year 2010 congressional budget request for the Advanced 
Simulation and Computing Campaign provides growth in physics and 
engineering models as support shifts away from hardware procurements 
and system software.
    The Readiness Campaign funds the development and deployment of 
modern manufacturing capabilities to produce materials and components 
in compliance with weapon design and performance requirements and in 
accordance with Life Extension Program and refurbishment schedules. In 
fiscal year 2010, the Readiness Campaign will focus on supporting the 
Tritium Readiness activities and high priority projects to deliver new 
or enhanced processes, technologies, and capabilities to meet the 
current needs of the stockpile. The reduction in Tritium Readiness was 
planned, and is due to the cyclical nature of production.
    The Readiness in Technical Base and Facilities request is $62 
million above the fiscal year 2009 appropriations. The increase is 
attributable to additional funding provided to mitigate increased 
pension costs at the M&O contractor sites. Within the request for 
operating expenses, an increase is included for the Kansas City Plant 
supporting the work for the move to a new, smaller facility. Funding 
for construction projects is requested at $203 million to sustain 
ongoing construction and design efforts. The location of funding for 
the PDCF project has been changed from DSW to RTBF. One new 
construction project is requested: the Nuclear Facilities Risk 
Reduction Project at Y-12 will provide maintenance to sustain uranium 
related capabilities at Building 9212.
    The Secure Transportation Asset program is requested at $234.9 
million, an increase of 9.6 percent over the fiscal year 2009 
appropriation. The STA program plans to acquire a total of three 
transport category aircraft. One 737-type aircraft will be purchased 
each year--starting in fiscal year 2010, fiscal year 2011, and fiscal 
year 2012 to replace the aging aircraft. In addition to the aircraft 
purchases, the remaining increase will be used for training and 
equipment.
            Nuclear Counterterrorism Incident Response (NCTIR)/
                    Emergency Operations
    The NCTIR program responds to and mitigates nuclear and 
radiological incidents worldwide as the U.S. Government's primary 
capability for radiological and nuclear emergency response. The fiscal 
year 2010 congressional budget request for these activities is $221.9 
million, an increase of 3 percent over fiscal year 2009 appropriations. 
The increase reflects funding growth in three specific areas of the 
program--International Emergency Management and Cooperation, Emergency 
Response, and Render Safe Stabilization Operations. These initiatives 
support increased efforts to address serious emergency management 
programs in priority countries, while continuing and completing ongoing 
programs with the International Atomic Energy Agency (IAEA) and other 
international partners and countries; scientific breakthroughs for 
Render Safe Stabilization Operations and the Technical Integration 
programs and continued implementation of National Technical Nuclear 
Forensics for pre- and post-detonation phases and the Stabilization 
aspect of nuclear emergencies through development of first generation 
stabilization equipment including training and maintenance programs to 
selected teams nationwide in support of better emergency response 
capability.
            Infrastructure and Environment
    This organization is responsible for the Facilities and 
Infrastructure Recapitalization Program, (FIRP) and the new Site 
Stewardship Program which encompasses Environmental Projects and 
Operations (EPO) that provides for Long-Term Stewardship (LTS) at NNSA 
sites after remediation is completed by the DOE Office of Environmental 
Management, Nuclear Materials Integration, Stewardship Planning which 
contains a renewable energy efficiency project; and may ultimately 
include deactivation and demolition activities.
    The fiscal year 2010 congressional budget request for FIRP is 
$154.9 million, an increase of 5 percent above fiscal year 2009. This 
provides funding for recapitalization, infrastructure planning and 
construction. The increase supports continued progress in restoring the 
condition of mission critical facilities and infrastructure across the 
Nuclear Security Enterprise to an acceptable condition. The program's 
original goals established in fiscal year 2003 include: elimination of 
$1.2 billion of deferred maintenance, achieving a Facility Condition 
Index (FCI) of 5 percent, and elimination of 3 million gsf of excess 
facilities. The original $1.2 billion deferred maintenance buydown goal 
is based on the requirement to meet the FIRP commitment of 5 percent 
FCI for all facilities. The program's deferred maintenance goal was 
adjusted in fiscal year 2007 to eliminate $900 million of deferred 
maintenance by fiscal year 2013 as a result of transformation decisions 
that reduced facility deferred maintenance requirements. The principle 
assumption governing FIRP is that the program will be funded only 
through fiscal year 2013.
    The fiscal year 2010 congressional budget request for Facilities 
and Infrastructure Recapitalization is $154.9 million, an increase of 5 
percent above fiscal year 2009. This provides funding for 
recapitalization, infrastructure planning and construction. The 
increase supports continued progress in restoring the condition of 
mission essential facilities and infrastructure across the Nuclear 
Security Enterprise to an acceptable condition.
    The fiscal year 2010 congressional budget request for the new GPRA 
Unit, Site Stewardship, is $90.4 million. The goal of the Site 
Stewardship Program is to ensure environmental compliance and energy 
and operational efficiency throughout the Nuclear Security Enterprise, 
while modernizing, streamlining, consolidating, and sustaining the 
stewardship and vitality of the sites as they transition within NNSA's 
plans for transformation. The Site Stewardship program will institute 
and maintain a robust operational framework at the NNSA Government-
owned, contractor-operated sites that encompass responsibility for 
achieving the NNSA mission. This new GPRA Unit will encompass 
activities currently under Environmental Projects and Operations (EPO) 
and will include new subprogram elements Nuclear Materials Integration 
(NMI) and Stewardship Planning. In the I&E organization only EPO was 
funded (as a separate GPRA unit) in fiscal year 2008 and fiscal year 
2009 and is reflected as such for those 2 years since this is a non-
comparable budget submission. The Environmental Programs and Operations 
increases 7 percent over the fiscal year 2009 appropriation to address 
ongoing and new regulatory-driven Long Term Stewardship activities at 
NNSA sites where Environmental Management activities have been 
completed. Nuclear Materials Integration provides focused attention on 
the consolidation and disposition of specific NNSA special nuclear 
materials. Current activities include the de-inventory of security 
Category I and II Special Nuclear Material (SNM) from LLNL and also the 
consolidation and disposal of inactive actinides at other sites. Funds 
for these material consolidation and disposal activities are being 
transferred from Defense Programs to Infrastructure and Environment in 
fiscal year 2010.
    The majority of the requested fiscal year 2010 funding increase of 
$28 million is in Stewardship Planning for an operating expense-funded 
project, the Pantex Renewable Energy Project (PREP) at the Pantex 
Plant, that will create a more flexible, more reliable, and 
environmentally friendly source of renewable energy that supports DOE/
NNSA operating goals and missions. The PREP will generate surplus 
electrical energy, reduce greenhouse gas emissions at local power 
plants, enhance energy security, and create jobs. This modular, 
operating expense-funded project will play a key role in satisfying 
NNSA's renewable energy objectives consistent with DOE Order 430.2B, 
Departmental Energy, Renewable Energy and Transportation Management.
            Defense Nuclear Security
    The fiscal year 2010 congressional budget request for Defense 
Nuclear Security is $749.0 million to support the base program and on 
sustaining the NNSA sites 2003 Design Basis Threat baseline operations, 
and begin initial steps to implement the Department's new Graded 
Security Protection (GSP) policy. During fiscal year 2010, the program 
will focus on eliminating or mitigating identified vulnerabilities 
across the Nuclear Security Enterprise. Funding for one new 
construction start is requested for the Security Improvements Project 
(SIP). The SIP will install a new security system to manage and 
integrate personnel security and access control systems at the Y-12 
National Security Complex.
    Starting in fiscal year 2009, there is no longer an ``offset'' in 
this account or the Departmental Administration Appropriation for the 
security charges associated with reimbursable work. In the fiscal year 
2010 congressional budget request, mission-driven activities will 
continue to be fully funded with direct appropriations, but security 
required for Work for Others will be covered as part of full cost 
recovery for these projects. Institutional security activities will 
continue to be funded by indirect or general and administrative costs 
at each site.
            Cyber Security
    The Cyber Security program will sustain the NNSA infrastructure and 
upgrade elements that will counter cyber threats from external and 
internal attacks using the latest available technologies.
    The fiscal year 2010 congressional budget request for Cyber 
Security is $122.5 million, an increase of 1 percent over the fiscal 
year 2009 appropriations. The Cyber Security program is in the process 
of a major 5-year effort focused on revitalization, certification, 
accreditation and training across the NNSA enterprise. Revitalization 
enables NNSA to respond to its highest priorities and to address 
current and future risks; certification and accreditation assure proper 
documentation of risks and justification of associated operations for 
systems at all sites; and, education and awareness provides training 
for Federal and contractor personnel to meet expanding skill 
requirements of NNSA cyber security and information environments.
            Defense Nuclear Nonproliferation (DNN) Appropriation
    The DNN program goal is to detect, prevent, and reverse the 
proliferation of Weapons of Mass Destruction (WMD). Our programs 
address the threat that hostile nations or terrorist groups may acquire 
weapons of mass destruction or weapons-usable material, dual-use 
production or technology, or WMD capabilities, by securing or 
eliminating vulnerable stockpiles of weapon-usable materials, 
technology, and expertise in Russia and other countries of concern.
    The fiscal year 2010 congressional budget request for the DNN 
appropriation totals $2.1 billion. The most significant fiscal year 
2010 and out-year increases relate to the request to move the funding 
for the MOX Fuel Fabrication Facility project and the WSB back to 
NNSA's DNN Programs. The NNSA has funded the MOX Fuel Fabrication 
Facility project and the WSB baseline increases within the requested 
funding for fiscal year 2010 and the outyears. Other increases include 
International Materials Protection and Cooperation (INMP&C) and 
Nonproliferation and International Security (NIS), both of which 
increase 38 percent over the fiscal year 2009 levels.
    Funding in the INMP&C fiscal year 2010 congressional budget request 
of $552.3 million is an increase of 38 percent over the fiscal year 
2009 appropriated level. This increase is the first step in fulfilling 
President Obama's promise during his Prague address that the United 
States will expand its partnership with Russia and pursue new 
partnerships to eliminate or secure vulnerable nuclear materials. This 
budget provides for sustainability support to Russian warhead and 
material sites with completed INMP&C upgrades, INMP&C upgrades to 
areas/buildings agreed to after the Bratislava Summit and the projects 
to assist the Russian Federation and other partner countries in 
establishing the necessary infrastructure to sustain effective MPC&A 
operations. In addition, the budget provides for the Second Line of 
Defense program and the installation of radiation detection equipment 
at 43 foreign sites and 15 Megaports.
    The fiscal year 2010 congressional budget request for the NIS 
program is $207.2 million, an increase of 38 percent over the fiscal 
year 2009 appropriations. This supports the Next Generation Safeguards 
Initiative (NGSI), which aims to strengthen the international 
safeguards system and revitalize the U.S. technical base and the human 
capital that supports it; as well as nuclear disablement, 
dismantlement, and verification activities in North Korea; policy and 
technical support for U.S. efforts to address proliferation by Iran, 
North Korea and proliferation networks; and the implementation of 
nuclear arms reduction and associated agreements.
    The fiscal year 2010 congressional budget request for the Global 
Threat Reduction Initiative (GTRI) is $353.5 million, a 10.5 percent 
reduction from the fiscal year 2009 appropriations. Most of this 
decrease results from the completion of the Kazakhstan Spent Fuel work 
in CY 2010. The fiscal year 2010 congressional budget request of $24.5 
million for the Elimination of Weapons Grade Plutonium Production 
(EWGPP) is the final increment of U.S. funding needed for this program. 
The significant reduction in the budget reflects close-out and 
completion of the construction activities for the Zheleznogorsk 
Project.
    The Nonproliferation and Verification R&D program is requested at 
$297.3 million, a decrease from the fiscal year 2009 level. This 
decrease reflects both an unrequested congressional addition in 2009 
and NNSA's funding in 2009 of the total required in 2009 and 2010 for 
the Physical Sciences building in Washington State. The $297.3 million 
is sufficient to support long-term R&D leading to detection systems for 
strengthening U.S. capabilities to respond to current and projected 
threats to national and homeland security posed by the proliferation of 
nuclear weapons and diversion of special nuclear material. Almost a 
third of this funding is for production of operational nuclear 
detonation detection sensors to support the Nation's operational 
nuclear detonation detection and reporting infrastructure through joint 
programs with DOD.
    The President's Request for Fissile Materials Disposition is $701.9 
million, reflecting the transfer of funding for the MOX Fuel 
Fabrication Facility project and WSB projects back to this program. In 
addition to these U.S. plutonium disposition activities, the program 
supports three other principal elements: efforts to dispose of U.S. HEU 
declared surplus to defense needs primarily by down-blending it into 
low enriched uranium; technical analyses and support to negotiations 
among the United States, Russia, and the International Atomic Energy 
Agency on monitoring and inspection regimes required by a 2000 U.S.-
Russia plutonium disposition agreement; and limited support for the 
early disposition of Russia's plutonium in that country's BN-600 
reactor including U.S. technical support to oversee work in Russia for 
early disposition of Russian weapon-grade plutonium in fast reactors. 
The United States and Russia began negotiations on amendments to the 
2000 Agreement in 2008, and expect to complete the negotiations this 
summer.
            Naval Reactors Appropriation
    The NNSA's Naval Reactors program continues to provide the U.S. 
Navy with safe, military effective nuclear propulsion plants and ensure 
their continued safe and reliable operation. The fiscal year 2010 
congressional budget request for Naval Reactors is $1,003.1 million, an 
increase of 21 percent over the fiscal year 2009 appropriations.
    This increase provides additional funding to initiate the new 
mission work for the design and delivery of a new reactor core and 
propulsion plant to support the next-generation submarine design, and 
refueling of the S8G Prototype, one of two land-based reactor plant 
prototypes that serve as a testing platform for nuclear technology. 
Significant outyear funding is required for both of these activities. A 
portion of the fiscal year 2010 increase will also support Naval 
Reactors pension responsibilities.
            Office of the Administrator Appropriation
    This appropriation provides corporate direction, Federal personnel, 
and resources necessary to plan, manage, and oversee the operation of 
the NNSA. It provides funding for all Federal NNSA staff in 
Headquarters and field locations except those supporting Naval Reactors 
and the Secure Transportation Asset agents and transportation staff.
    The fiscal year 2010 congressional budget request of $420.8 million 
reflects a decrease of $18.4 million that is attributable to 
Congressionally-directed projects funded in fiscal year 2009. Staffing 
increases in fiscal year 2010 by 28 full time equivalents (FTEs) from 
1,942 to 1,970 reflecting functional transfers and growth to 
accommodate mission program increases. The projected staffing level for 
fiscal year 2010 is 1,970 and is maintained throughout the outyear 
period. The Historically Black Colleges/Hispanic Serving Institutions 
programs will continue through fiscal year 2010 on grants made by 
appropriations provided in fiscal year 2009 and through program 
funding. The fiscal year 2010 congressional budget request includes 
$4.1 million for the Massie Chairs and related activities only.

    Senator Dorgan. Mr. D'Agostino, thank you very much. I 
appreciate very much your appearance and the appearance of 
Brigadier General Harencak and Ken Baker as well.
    Let me just make a quick comment first. I noted that an OMB 
document earlier this year called for a study of moving the 
NNSA out of the Department of Energy and into the Department of 
Defense. It reminds me that bad ideas have unlimited shelf life 
here in the Nation's capital, and also that bad ideas are 
bipartisan.
    This is a bad idea that has been debated and long ago 
discarded. So if you get a chance to talk to OMB, would you 
suggest that they close the cover of that book and move on?
    Mr. D'Agostino. Yes, sir. I will be glad to.

            FUTURE OF THE LOS ALAMOS NEUTRON SCIENCE CENTER

    Senator Dorgan. Thank you very much.
    I understand that the budget proposal that you are here to 
discuss proposes eliminating funding for the refurbishing of 
what is called the Los Alamos Neutron Science Center, or the 
LANSCE facility. We have an OMB passback calling for canceling 
this project. So perhaps it was not your decision, but there is 
no funding for LANSCE refurbishment in the 2010 request, though 
it was provided $19 million in last year's request.
    I am told that there is no other classified facility 
capable of the scientific research being conducted at LANSCE. I 
am told to replace the LANSCE facility or to make another 
facility, such as SNS, at Oak Ridge classified would be more 
expensive than refurbishment.
    So, a couple of questions, do you believe that LANSCE is 
important to the Stockpile Stewardship Program?
    Mr. D'Agostino. Yes, I do, sir.
    Senator Dorgan. Considering the age of the stockpile and 
non-proliferation treaties, do you think keeping the LANSCE 
facility operating in the future will be important for the 
country?
    Mr. D'Agostino. Absolutely. I think it will be useful to 
help us in neutron cross-section measurement, which is what it 
is doing right now, and to exploring what we call proton 
radiography, which is a different way of examining what is 
actually going on inside very dense materials, and to do the 
nuclear science and material science work. We think the country 
needs that in the future.
    Senator Dorgan. Without refurbishment, how long is the 
LANSCE expected to be an effective facility?
    Mr. D'Agostino. That is a tough question to answer. Most of 
what we are doing right now is accepting risk if we don't 
refurbish the facility, risk that the accelerator pieces are 
going to get to a point where they will age out. Already some 
of the components are hard to replace.
    So what we are in right now is a maintenance mode, keeping 
it working. In fact, that is our plan out into the future--
keeping the facility working out into the future. My goal is to 
revisit this discussion or revisit the question because I do 
think, in the long run, what we do with LANSCE ultimately has 
to be integrated with the bigger picture on science and the 
technology that we need to maintain out in the future.
    And so, my goal would be to essentially make sure it keeps 
operating, one; keep doing the experiments that we need, two; 
and three, figure out, make sure that we have an integrated 
picture post NPR, once the NPR is done, that figures out how 
science and technology fits in.

                         SCIENCE FUNDING TRENDS

    Senator Dorgan. Well, at this point, we are not talking 
about the Reliable Replacement Weapon, or the RRW program, but 
we are talking about stockpile stewardship, which I understand 
is increasingly reliant on science. So the question is, given 
the heavy reliance on science for stockpile stewardship and 
reliability, how do we reconcile flat funding in the area of 
science?
    Mr. D'Agostino. What we did, as a result of a number of 
changes that have happened over the last 3 months, frankly, I 
have decided that it was much more important to make sure that 
we stem and stop the decrease in our science programs that was 
happening, as you noted in your remarks earlier. And so, what 
we did is some reallocation, quite frankly, in the last few 
months, about $130 million worth to stop the decrease where 
science was going, and then--what I would call stop the 
bleeding, and then start getting in on the repair side.
    So where are we right now, it is my plan, at least, this is 
the low point on science is stopping the decrease, and then we 
are going to need to be reinvesting out into the future, fiscal 
year 2011 budgets and the like.
    You will notice, sir, and as you have said, the numbers are 
exactly the same. And you said, was that coincidence or what? 
It is not--what are the chances of having an exact same out-
year number? And its chances are zero. And the reality is I 
have submitted to you or to Congress--the President has 
submitted to you essentially a program that says this is a 1-
year look. The administration has just come in, established 
some very aggressive and some broad goals that it wants to 
implement in the nuclear security arena.
    And because of that, some of these programs, the idea of 
securing materials worldwide in 4 years; as you mentioned, this 
Comprehensive Test Ban Treaty piece; fissile material cutoff 
piece; the new START Treaty; the dismantlements; those require 
a fair amount of detailed program planning that we are doing 
right now. And we didn't have time to reflect that 
appropriately in the out-year budget request. So you will see 
these strange-looking numbers, and that is why.

                       NUCLEAR NON-PROLIFERATION

    Senator Dorgan. Given what has happened in the world in 
recent days, weeks, months, it seems to me that the issue of 
nuclear non-proliferation is unbelievably important. It is 
something people don't talk about in coffee shops. I understand 
that. It is not part of the contemporary debate on talk shows. 
But it is unbelievably important.
    It appears that that account is flat-funded, and the 
President announced his goal to secure all nuclear material 
around the world by 2012. As I understand it, a team of 
officials was sent to Moscow some weeks ago to begin 
negotiations for replacing the START Treaty. Last week, North 
Korea, we think, set off their second nuclear weapon in 3 
years.
    With such increased emphasis on the need for nuclear test 
monitoring, verification research and those kinds of activities 
in the nuclear non-proliferation budget, how is it that the 
research and verification is reduced significantly? I mean does 
that square with anything that I just described or with 
anything that you believe?
    Mr. D'Agostino. I will explain how it squares. I do believe 
out into the future, you will be seeing a fairly different 
program from us. But let me start off with the following, if I 
could. You mentioned North Korea. And I would like, Mr. Baker, 
if you could, to talk to some of the details on the research 
and development program.
    The intelligence analysts that this country has used over 
the last--well, certainly very aggressively over the last 10 
days or so, but obviously, in the previous years, that analyze 
what is happening in the world, both nuclear smuggling, 
proliferation of not just materials, but components, missile 
technology, and the like. Most of those experts ultimately 
come, as you are probably aware, from this program, and they 
start off at the base. They start off in the General's program, 
and they end up being supportive to the intelligence agencies 
and the like.
    So we know what we know because of those folks. Ken Baker 
can talk about the research and development program and why the 
budget changes the way it does.
    Mr. Baker. I agree with you, Senator. It is a very 
dangerous world out there, probably more so than ever, even 
when we were back in the cold war, in my opinion.
    The research and development program has been reduced. The 
reason why it has been reduced this year, we had an $85 million 
plus-up last year over the President's budget, and we have 
finished the work at the Pacific Northwest laboratory, which 
was something like $40 million. That program is down. It is 
critical to us. It will be critical in the CTBT. It will be 
critical in START.
    It is a very important program, and again, I think you will 
see in the next years, as we work this 4-year plan, that 
budgets will increase in the future.
    Senator Dorgan. Senator Bennett?
    Senator Bennett. Thank you, Mr. Chairman.
    And I would like to follow up on the line of questioning 
you have already begun.

    IMPACT OF FLAT-FUNDING ON WEAPONS AND NON-PROLIFERATION PROGRAMS

    Mr. D'Agostino, you say funding is level, but, in fact, 
there are internal demands that make the amount of money that 
actually--to use an analogy that we have out in the West, the 
amount of water that actually gets to the end of the ditch is 
smaller than the overall numbers would indicate. I am talking 
about the pension shortfalls.
    It is my understanding that you have to make up some of the 
pension shortfalls of your contractors. Is that correct?
    Mr. D'Agostino. That is correct, Senator.
    Senator Bennett. All right. The numbers I have say that the 
contributions paid to DOE contractors in their pension plans 
from 2008--2003 to 2008 was $330 million, and you expect to pay 
$1.5 billion per year over the next 5 years, with the peak 
contribution years estimated to come in 2012 and 2013 at just 
under $2 billion per year.
    Now if you are going to deduct most of the savings out of 
the operating budget and delay facility closures and preventive 
maintenance and consolidation of special nuclear materials, 
obviously the top-line number is deceiving. So I think the 
trend is simply unsustainable. It will have a devastating 
impact on the weapons and non-proliferation program, and I want 
to know what the Department has considered, actions being taken 
to mitigate this problem over the next 5 years.
    Mr. D'Agostino. Yes, sir. You are absolutely right. With 
those kinds of numbers with no changes, that is an 
unsustainable path. It is an unsustainable program. But I will 
tell you what the Department has done at this point. And what 
the Department, I say the administration has done, quite 
frankly.
    One is when we first started this year, we were faced with 
this immediate problem. So we looked in just fiscal year 2009 
at areas where programs weren't spending, we didn't see the 
expenditure rate, things had gotten slow to start, and we 
figured out what could shift back a little bit. And we also 
made some adjustments to our overhead rates to get through 
fiscal year 2009. Otherwise, we would have been in the process 
of sending out literally tens of thousands of letters to all of 
our employees saying that their pension fund is underfunded.
    So that took care of fiscal year 2009. And for fiscal year 
2010, which is the current budget, we have received an 
increase. The total liability is on the order of close to $300 
million that we were potentially expecting in 2010. So what we 
received is an increase of about $122 million in order to 
address specifically the pension shortfall in our fiscal year 
2010 budget. That leaves, of course, $160 million of 
uncertainty.
    The way the pension process works, and I apologize for 
giving the long answer, is every January we go off and take a 
look at where we are, kind of a snapshot look. And that sets 
the trend for the upcoming year. This past January, we thought 
next year would be worse, and that is why we have come up with 
$122 million.
    We don't know what January is going to look like. So what 
we have taken is a big step in the right direction toward 
addressing our 2010 shortfall with the understanding that the 
financial situation will be different in January. It might be 
worse. It might be better. But we wanted to at least approach 
the solution with the backup plan to make some adjustments to 
our indirect rates. That kind of will spread the problem a 
little bit more broadly.
    So it is a dynamic problem, we look at it on a monthly 
basis. And this is, unfortunately, we are in a situation where 
we are going to be looking at it on this regular basis out into 
the future. But in the end, it is going to require, I believe, 
increases to top lines if we continue to see the past 
performance.
    Senator Bennett. That is the point I wanted to make and 
want to have clear on the record, that, at some point, the top 
line has to go up, or everything else suffers from it. We are 
in a fool's paradise if we say, ``Oh, we are keeping the 
funding level,'' when, effectively, we are not for these 
reasons.
    Mr. D'Agostino. Yes, sir.

  RESEARCH INTEGRATION BETWEEN THE DEPARTMENT OF ENERGY AND NATIONAL 
                    NUCLEAR SECURITY ADMINISTRATION

    Senator Bennett. Now let us talk about the need for 
scientific leadership within NNSA. I think we need to consider 
a new position within NNSA to steward and cultivate scientific 
research.
    Such an individual could help raise awareness of both 
weapon science and non-weapon science that goes on at the labs 
and work to integrate research among the DOE and NNSA labs. And 
the grand challenge of energy security and climate change 
science are of such complexity that this work, I think, should 
be shared with all the labs. I had reference made to that when 
I was out in the labs, when you were kind enough to give that 
tour.
    So I am considering a modification to the NNSA Act to 
create a new position within NNSA that would report directly to 
you, and it would--this position would lead the NNSA science 
program and work with the rest of the Department to integrate 
the national security capabilities with those in basic applied 
programs within DOE. Can you give me your reaction to that 
idea?
    Mr. D'Agostino. Yes, sir. Though not part of the NNSA Act, 
I think consistent--particularly after our trip that we took 
about a year and a half ago sir, we talked about the importance 
of science. Dr. Dave Crandall, who used to run the Research, 
Development, and Simulation Program in the weapons program, I 
brought him up to advise me. He doesn't have an official role, 
if you will, as you have described, from an authority 
standpoint. But in effect, he is doing some of that work as a 
chief scientist.
    I think the idea of having a named position is a good idea. 
It is very consistent with our drive to not so much focus just 
on nuclear weapons science, but to focus on nuclear security 
science, which will address non-proliferation, 
counterterrorism, forensics, and then, more broadly, work with 
the rest of the Department, the Office of Science, to draw 
those links together and show how these computers and these 
people can address global problems.
    So I am very favorably disposed to your suggestion, sir.
    Senator Bennett. All right. Well, I am glad you are using 
Dr. Crandall. But he has no budget authority and no mission 
responsibility.
    Mr. D'Agostino. Right.
    Senator Bennett. And so, I will be talking to you about how 
we might proceed on that.
    Mr. D'Agostino. Yes, sir.
    Senator Bennett. Thank you, Mr. Chairman.
    Senator Dorgan. Senator Feinstein?
    Senator Feinstein. Thank you very much, Mr. Chairman. I 
trust this mike is not working.
    Senator Dorgan. Turn it on and speak directly into it, if 
you would?
    Senator Feinstein. Hello? It is working.

   NUCLEAR POSTURE REVIEW, WEAPONS TREATY NEGOTIATION, AND STOCKPILE 
                               REDUCTION

    Mr. D'Agostino, it is my understanding, and the chairman 
touched on this, that you are involved in two efforts. One is 
the negotiation for a new nuclear weapons treaty with Russia, 
and the other is the Nuclear Posture Review that is due out the 
early part of 2010.
    It has been reported that this new treaty could set a new 
ceiling of 1,500 operationally deployed nuclear warheads for 
each nation, down from 1,700 to 2,200 under the Moscow treaty. 
Is that, in effect, true?
    Mr. D'Agostino. There are a lot of numbers. The short 
answer is we haven't closed on the details. There are a lot of 
numbers being bantered around. The President has made it very 
clear that he wants a number lower than the 1,700 to 2,200 
number.
    Where we are right now in the Nuclear Posture Review, which 
is the kind of committee of people that will be briefing the 
National Security Council and, ultimately, the President, quite 
frankly, in the next relatively short period of time, we are in 
the discussion phase of examining the policy. What is the 
policy that the Nation wants to carry forward into the future? 
And what size of stockpile is needed to maintain that policy 
strongly?
    There is a 1,500 number floating around out there. There 
are some lower numbers. There are some higher numbers, and I 
would rather not try to make a commitment right now.
    Senator Feinstein. Yes, all right. Well, that is fine. I am 
for the lowest possible number, as you know.
    Mr. D'Agostino. Yes, ma'am.
    Senator Feinstein. I think the buildup of huge nuclear 
weapons, 90 percent of which are owned by Russia and the United 
States, really endangers the world and really opens us up to 
all kinds of problems. So you know my views on this subject 
well.
    Mr. D'Agostino. Yes, ma'am.

         COSTS AND RESULTS OF NUCLEAR LABORATORY PRIVATIZATION

    Senator Feinstein. What is the total loss of employees at 
our nuclear labs since the privatization?
    Mr. D'Agostino. We have lost--as I have looked at the 
numbers going back in time for the last 3 or 4 years or so, the 
NNSA overall has changed, if you will, about 1,500--I will get 
to your answer. But overall, about 1,500 folks a year or so out 
of the 32,000, which we started off with, have been coming out.
    Senator Feinstein. Well, what is the total? I know it is 
over 2,000 at Los Alamos alone.
    Mr. D'Agostino. Yes, it is. The total is probably between 
3,000 and 3,500, give or take. It depends if we are counting 
not full-time lab employees, but temporary lab employees. But, 
in essence, it is in the thousands. It is a fairly significant 
number. It is a number that was about 2,500 or so last year 
when we talked to you, talked to the subcommittee here last 
year.
    It is a number that, for the most part, the lab directors 
have focused on driving these changes not with their scientists 
or engineers, though they have had to get into that some. But 
most of these reductions have happened as a result of 
administrative personnel being more efficient, quite frankly. 
And George Miller has got some good examples.
    Senator Feinstein. I am not talking necessarily about any 
one particular lab. I can tell you this. When I visited Los 
Alamos, the most significant thing I took away from it was the 
lack of people in that facility.
    Mr. D'Agostino. Right.
    Senator Feinstein. And I am concerned by it. And I remember 
the budget last year and the year before when you have these 
enormous fees to run these labs and those fees have been paid 
by cutting employees. And I think that is just a fact.
    Now the question comes, what does this do to the mission? 
And I am very concerned about it because I think the mission is 
subtly changing, the mission of the labs. I think the 
privatization is toward pushing things into the private sector, 
and the purpose of these labs is really to do some of the most 
advanced work that keeps this Nation ahead of others. And I am 
very worried about it and not at all sure that it is the right 
thing to have done.
    So let me ask you this question. Since the privatization, 
what would you name as the three big achievements produced by 
privatization?
    Mr. D'Agostino. What I would say the first achievement is 
on security. We have seen some huge improvements in security at 
both of the laboratories since privatization.
    Senator Feinstein. Okay, granted. And that is where the 
university was weak, and that has been picked up, and the 
security has improved. What else?
    Mr. D'Agostino. The other area is in management systems. 
Frankly, Los Alamos, for example, spread out over 43 square 
miles, was, in essence, a balkanized set of smaller 
laboratories, each operating slightly different procedures and 
procurement processes. It was very inefficient and caused 
problems.
    So the new management has drawn the lab together much more 
tightly and has driven----
    Senator Feinstein. Okay, and a third?
    Mr. D'Agostino. And has driven----
    Senator Feinstein. My time is going to--it is up, so a 
third?
    Mr. D'Agostino. Oh, okay. The third area I would see is 
focus. We have seen the kind of responsiveness to driving 
change and just as you described it very clearly, mission 
change. I would look at mission change to shifting from a cold 
war mission focus to a future world mission focus. I have seen 
movement on both of those laboratories and, in fact, working 
together, the two laboratories working together on establishing 
a new mission that I haven't seen in previous years.
    And I have worked in this program for a number of years 
and, quite frankly, am very impressed with the focus that Norm 
Pattiz has driven, as the Board of Governors, into making sure 
that there is responsiveness to the Government there. I 
recognize that there are downsides, too, ma'am, as well, as we 
talked about.
    Senator Feinstein. Well, I just--in one sentence. I would 
agree that there have been administrative changes, security 
changes, and that is good--at a tremendous price.
    And I am still--and maybe there is focus, but what I want 
to see is, what is the increased productivity in terms of 
benefit to the Nation? Candidly, I haven't seen it. So if it is 
there, I would hope you would advise me of it as time goes on.
    Mr. D'Agostino. I would like to do that, and I would 
actually like to take that for the record, if I could, and then 
provide that in writing?
    Senator Feinstein. I would be happy if you would do that.
    Senator Dorgan. Well, before the Senator from California 
leaves, we have had testimony from some laboratory directors 
about the substantial increased cost of the contracts to 
supervise these laboratories. We have also had some testimony 
about how these costs have ratcheted up, up, way up in a very 
dramatic fashion, and that eats into the ability to retain the 
scientists.
    I would like to understand this. I understand your answer 
that there have been some benefits, and I accept that security 
and other things. But it is also the case, isn't it, that the 
substantial increase in costs of these contracts to manage 
these laboratories by the private sector have increased? Could 
you send us some analysis of the weapons labs so that we can 
understand what those increases have been?
    Mr. D'Agostino. I would like to do that, Senator. I think 
that would be great. Or I could answer it now? It depends on 
how much time you have, sir.

                      LASER-POWERED FUSION ENERGY

    Senator Dorgan. Well, I want to ask Senator Feinstein to 
ask a few questions about the fission/fusion observation she 
saw because I am also interested in that. If you have time and 
you want to ask those questions, let me yield to you so that we 
can hear that discussion.
    Senator Feinstein. All right. The place is amazing. I have 
never seen anything like it. It truly looks like Star Wars. And 
the fact that you can get all of these lasers concentrating on 
this little tiny target of hydrogen encased in this gold pellet 
that goes ``boom'' and pushes out all of this energy. Now this 
just in my layperson's first blush is truly amazing.
    I think a purpose of the lab--or of this program, 
obviously, is to see that our nuclear weapons are safe without 
testing, and the assumption is that it will be able to do it. 
But the promise for the future is so great in terms of nuclear 
science and what nuclear science might produce as we develop 
the green economy. I mean, that is kind of the way I see it, 
but you may differ with that, Mr. D'Agostino?
    Mr. D'Agostino. No, ma'am. You have actually characterized 
it quite well. The three main purposes, first of all, the 
primary purpose is to support the deterrent. And frankly, I 
call it building that core group of varsity science team people 
that we need to address the non-proliferation problems that the 
country faces, the forensics and intelligence analysis that the 
country needs. That is number one.
    Number two, obviously, is advance the basic science. And 
number three, you have hit on it, is this idea that there is 
the opportunity to bring fusion into the picture to address a 
carbon-free kind of energy environment.
    So what I would say on the third element, which, of course, 
is kind of nirvana in some respects, and we will describe it 
that way, is the first step is to get to ignition. And we can't 
get to fusion without ignition. So our focus, our eyes will be 
focused in 2010 on getting a first credible ignition experiment 
and then seeing where that goes.
    The laboratory clearly has some proposals in that area on 
what the next step might be. I love the enthusiasm of the 
scientists and engineers there. It is captivating. It is 
energizing. I also want them to be pragmatic and realistic 
because I need to come and tell you what we believe we need in 
order to have an effective program.
    I believe it is time to start thinking about the next step, 
but it is not time to start figuring out, start pouring 
concrete because we are not quite there yet. So the first step 
is to do the ignition experiments, get success on fusion here 
on Earth. It has never been done before. It is a real tough 
problem.
    As Ed Moses said, Mother Nature is a tough person to deal 
with, and that reality is there. But it is quite exciting about 
what the future may hold.
    Senator Feinstein. Tom Friedman visited the lab last month 
and wrote a column, and he said if this thing works, it is a 
``holy cow'' game changer. And that is the fusion, and I guess 
eventually fission then, that is to keep the waste down, right?
    Mr. D'Agostino. The idea is fusion will release a 
tremendous--yes, ma'am. The fusion will release a tremendous 
amount of X-rays and neutrons that can ultimately be used to 
burn up, in effect, waste to these actinides and deal with what 
they call a fusion/fission hybrid. It is this idea of taking--
--
    Senator Dorgan. But pure fusion consumes its waste, doesn't 
it?
    Mr. D'Agostino. Pure fusion only generates helium, which is 
the helium gas. So it is not a problem. So, in effect, it 
doesn't really generate the kind of waste we see from fission, 
which generates these highly radioactive wastes. But what it 
does do, sir, is generate these neutrons and X-rays that can go 
help us burn up these materials that we would like to get rid 
of, ultimately.
    Senator Dorgan. As you can tell, we have a very strong 
scientific background here.
    Mr. D'Agostino. You did very well, sir.
    Senator Dorgan. The cloture vote just started, just an 
observation. I toured a lab the other day. It reminded me when 
you talked about lasers. Lasers are used for so many things. I 
toured a lab the other day in which they are using 
sophisticated computer technology and lasers to target female 
mosquitoes. Those are the ones that bite.
    Senator Feinstein. As all species.
    Senator Dorgan. I couldn't have said that. But at any rate, 
they can target over a 100-yard area all the mosquitoes and 
target the female mosquitoes, destroy the mosquitoes with 
lasers. It is pretty extraordinary, part of what they are 
trying to do is deal with malaria and other issues.
    At any rate, again, Mr. D'Agostino, we have a cloture vote 
that has started. What I would like to do is I have other 
questions, and I want to send you a list of questions and ask 
that you would respond for the record as we begin to get down 
the road here and evaluate what we might want to do on the 
appropriations side.
    I do want to say to you that I think this subcommittee has 
an advantage in working with you, and we appreciate you and 
your colleagues who have joined you today, the work that you 
are doing. These are challenging times, and I think a lot of 
the discussion has been about Earth-penetrating, bunker-buster 
weapons, or RRW, or a whole ranging of things over recent 
years.
    Life extension programs and stockpile stewardship are 
critically important, but now, especially now, the issue of 
non-proliferation and nuclear intelligence and those things, we 
are going to rely on your agency in a very significant way. And 
we need to have the best people there. We need to have adequate 
funding. In many ways, our future depends on that.

                     ADDITIONAL COMMITTEE QUESTIONS

    So let me thank you and your colleagues for being here, and 
we will be submitting additional questions for the record.
    Mr. D'Agostino. Thank you, sir. And thank you, Senator 
Feinstein. I appreciate it.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

            Questions Submitted by Senator Dianne Feinstein

                            NUCLEAR WEAPONS

    Question. As you know, Congress, on a clear bi-partisan basis, 
eliminated all funding for the Reliable Replacement Warhead program in 
fiscal year 2008 and fiscal year 2009. I am pleased that the 
administration has requested no funding for this program in its fiscal 
year 2010 budget request. This is good news.
    What factors led the administration to request no funding?
    Answer. The decision to terminate the RRW program was a 
Presidential decision and is fully supported by NNSA. NNSA will 
continue to assess the requirements to maintain our aging nuclear 
deterrent. While doing so, NNSA will ensure that all weapon activities 
designed to ensure the longevity of that deterrent are properly 
integrated with the overall nuclear security strategy being formulated 
in the Nuclear Posture Review.
    Question. In your testimony, you state: ``. . . we are concerned 
about increasing challenges in maintaining, for the long term, the 
safety and reliability of the aging, finely tuned warheads that were 
produced in the 1970s and 1980s and are well past their original 
planned service life''.
    Are you leaving the door open for reviving RRW at a later date? Can 
we say that the program is dead?
    Answer. The RRW program has been terminated and will not be 
revived. We will by necessity have to address critical stockpile 
challenges through the Life Extension Program (LEP), such as the need 
to enhance weapon safety and security, address aging systems that have 
a low performance margin to failure, or use exotic and hazardous 
materials.
    Question. The administration has begun to negotiate a new nuclear 
weapons treaty with Russia with the goal of concluding an agreement by 
the end of the year. A new Nuclear Posture review is also due by the 
end of the year and I am pleased that the National Nuclear Security 
Administration is actively engaged in both efforts.
    How will the Nuclear Posture Review influence the size of the 
reductions in each nation's stockpile?
    Answer. The NPR made it an early priority to accomplish the 
analysis necessary to support the START Follow-on treaty negotiations, 
which President Obama and President Medvedev directed should be 
completed before START expires in December 2009. This analysis has 
concluded that maintaining a nuclear triad with a bilaterally 
verifiable reduced number of operationally deployed strategic nuclear 
weapons and accountable strategic delivery vehicles would enhance our 
national security objectives and continue to provide extended 
deterrence to allies and friends. As a result, President Obama reached 
a Joint Understanding with President Medvedev in July, stating that ``. 
. . each party will reduce and limit strategic offensive arms so that 7 
years after entry into force of the treaty and thereafter, the limits 
will be in the range of 500-1,100 for strategic delivery vehicles, and 
in the range of 1,500-1,675 for their associated warheads. The specific 
numbers to be recorded in the treaty for these limits will be agreed 
through further negotiations.'' Strategies for augmentation forces and 
non-strategic weapons are still under review by the NPR team. For more 
information on pre-decisional Nuclear Posture Review topics, please 
contact:
    Note.--Source: Dr. Bradley Roberts, Deputy Assistant to the 
Secretary of Defense for Nuclear and Missile Defense Policy Co-
Director, 2009 Nuclear Posture Review.
    Question. It has been reported that the new treaty could set a new 
ceiling of 1,500 operationally deployed nuclear warheads for each 
nation, down from 1,700 to 2,200 set by the Moscow Treaty.
    Is that your understanding? Can we go lower?
    Answer. NNSA will maintain the stockpile the President deems 
necessary to support our national security. In July, President Obama 
reached a Joint Understanding with President Medvedev, stating that ``. 
. . each party will reduce and limit strategic offensive arms so that 7 
years after entry into force of the treaty and thereafter, the limits 
will be in the range of 500-1,100 for strategic delivery vehicles, and 
in the range of 1,500-1,675 for their associated warheads. The specific 
numbers to be recorded in the treaty for these limits will be agreed 
through further negotiations.'' The NPR is continuing analysis of 
alternative strategic approaches beyond the immediate confines of the 
START Follow-on negotiations to frame options for strategic nuclear 
decisions for the next 5-10 years. This analysis includes investigating 
possible future security environments in which relations with Russia 
dramatically improve, as well as implications if the START Follow-on 
treaty does not enter into force or if reset of the U.S.-Russian 
relationship does not continue.

                    NUCLEAR NONPROLIFERATION EFFORTS

    Question. I firmly believe that ratification of the Comprehensive 
Test Ban Treaty is critical to reclaiming U.S. leadership in the 
nuclear nonproliferation field and bringing us closer to a world free 
of nuclear weapons. Does the National Nuclear Security Administration 
support ratification of the Comprehensive Test Ban Treaty?
    Answer. NNSA certainly supports the administration's decision to 
seek ratification of the CTBT. We are confident that the science-based 
Stockpile Stewardship program, when linked with weapon system 
surveillance and life extension programs, will assure weapon safety, 
security, and effectiveness. The same high level of technical expertise 
and relevant experience that NNSA applies to stockpile management 
without underground testing also allows NNSA to play a leading role in: 
(1) preventing other states from evading the Treaty; (2) supporting the 
establishment, sustainment, and operation of the International 
Monitoring System, the CTBT On- Site Inspection regime, and other 
elements of the CTBT verification system; and (3) sustaining and 
improving U.S. National Technical Means to ensure viable independent 
treaty verification.
    Question. I applaud your commitment to supporting President Obama's 
goal of securing all vulnerable nuclear materials from around the world 
within 4 years. What do you need from Congress to meet this goal? What 
programs will be involved? What are the key challenges?
    Answer. The President's April 5, 2009, Prague speech outlined an 
ambitious strategy to address the international nuclear threat, 
including measures to reduce and eventually eliminate existing nuclear 
arsenals, halt proliferation of nuclear weapons to additional states, 
and prevent terrorists from acquiring nuclear weapons or materials. As 
part of this strategy, the President announced a new American effort, 
working with our international partners, to secure vulnerable nuclear 
materials around the world within 4 years. NNSA will play a key role in 
these efforts, together with our colleagues at the Departments of 
State, Defense, and other key U.S. interagency and international 
partners.
    NNSA's Defense Nuclear Nonproliferation office already partners 
with over 120 countries to address global nuclear proliferation and 
nuclear terrorism threats. However, contributing fully to the 
President's goal to secure all vulnerable nuclear material worldwide 
within 4 years will require expanding our cooperation with Russia and 
other key countries, pursuing new partnerships to secure materials, and 
strengthening nuclear security standards, practices, and international 
safeguards. The administration is working to identify priorities for 
expanding and accelerating U.S. nonproliferation and nuclear security 
efforts overseas with available resources. Key challenges in 
contributing NNSA workscope to help achieve the administration's 
nuclear security vision relate to obtaining the necessary agreements 
from sovereign countries for this cooperation, as well as the need for 
related legal agreements and, in a few cases, new technological tools.

                              WEAPONS LABS

    Question. A few years ago, the U.S. Government privatized the DOE 
weapons labs, including Lawrence Livermore National Lab in California. 
Soon after, it became clear that the decision had changed the economy 
situation at the lab. With a need to pay both taxes and produce a 
profit, the lab made significant cutbacks in employment, from 5,872 to 
5,715 employees.
    Now a few years into this process, what do you see as the benefits 
of privatizing this lab? Please be as specific as possible. Do you 
believe these benefits still outweigh the costs?
    Answer. Lawrence Livermore National Security, LLC (LLNS) took over 
management of the Lawrence Livermore National Laboratory (LLNL) from 
the University of California (UC) in October, 2007. It is true that 
moving from a contractor that is a non-profit educational institution 
to a for-profit entity costs the Government more in taxes and 
management fee. At the same time, since LLNS took over the management 
of LLNL, the Laboratory's operating budget has declined. The 
combination of these factors has presented the LLNS management team 
with many challenges. Despite these challenges, LLNS has maintained 
UC's record of outstanding performance in the mission and scientific 
areas of work performed for the Government and non-Government sponsors.
    At this point in the 7-year base contract term, it is still too 
early to have realized significant benefits from the contract change. 
However, from NNSA's first annual performance evaluation report 
completed on LLNS in fiscal year 2008, we have seen some marked 
improvements and accomplishments in the following areas of activity:
    Mission:
  --Developed 1st generation 3D energy balance model for weapons 
        physics
  --Executed National Ignition Facility project within scope, schedule, 
        and budget
  --Accomplished significant computing advancements
  --Executed the TriPod strategy to provide a future common tri-lab 
        software system
  --Exceeded goals for removal of special nuclear material
  --Sustained world leading science despite staff reductions
  --Advancements in nonproliferation and threat reduction technical 
        capabilities
    Operations:
  --Accelerated safety compliance requirement submissions for all 
        nuclear facilities
  --Improved security protection without mission impact
    Business and Institutional Management:
  --Simplified the cost model and upgraded financial systems
  --Successfully executed a challenging workforce restructuring plan
  --Made significant progress in standing up a new contractor assurance 
        system --Implemented numerous cost reduction initiatives
  --Contributions of Parent organizations assessments to improvements
    Again, this was LLNS's first year accomplishments. We are currently 
evaluating their second year performance results (fiscal year 2009) and 
have observed further improvements. Based on our overall observations, 
we fully expect that there will be widespread improved results 
throughout the Laboratory in all areas of mission, operations and 
business/institutional management as the LLNS management team fully 
implements the changes it needs in order to become a more effective and 
efficient organization. As this occurs, the Government should begin to 
see the more significant benefits it hoped to realize from the contract 
change.
    Question. On May 23, 130 former employees of Lawrence Livermore 
National Laboratory filed suit against the lab alleging age 
discrimination during layoffs last May.
    I understand you may not be able to comment about this case, but 
what steps have you taken to ensure that labs are getting and retaining 
the best people, regardless of gender, age, or ethnicity?
    Answer. To entice university students to join NNSA, numerous 
intern-like programs that offer extensive training and on-the-job 
experiences are underway to recruit contractor employees including the 
Sandia Nuclear Weapons Intern Program that provides graduate level 
training in nuclear security enterprise operations and Department of 
Defense interfaces, the Nonproliferation Graduate Program for practical 
application in nuclear technologies and nonproliferation, and numerous 
postdoctoral fellowship, grants and intern opportunities. These intern 
programs educate university students about the mission of NNSA and 
offer training and hands-on educational opportunities that aren't often 
found in the private sector.
    To retain the best employees, the NNSA National Laboratories offer 
employees opportunities to participate in cutting edge science through 
the Laboratory Directed Research and Development program and via the 
Work for Others programs. There are also many prospects for employees 
to undertake detail assignments, job swaps, perform in acting 
management capacities, and education reimbursement and training 
opportunities. The goal is to provide challenging, career enhancing 
opportunities to entice experienced and expert employees to stay within 
the NNSA to retain skill sets that take years and years to develop.
                                 ______
                                 
               Questions Submitted by Senator Jon Tester

    Question. In addition to strengthening the administration's ability 
to secure vulnerable nuclear stockpiles in Russia, will budget 
increases for programs like the Nuclear Materials Protection and 
Cooperation help secure weapons in other nations? If so, which ones and 
how are the resources allocated within the agency?
    Answer. Yes, the budget increases will allow our MPC&A program to 
partner with countries beyond Russia to help secure vulnerable nuclear 
materials. As with our work with Russia, this cooperation is tailored 
to an individual country's needs and can consist of security best 
practices sharing, provision of equipment, and related training. We 
would be able to offer a detailed briefing, as appropriate, regarding 
these other priorities.
    Question. In your opinion, Administrator D'Agostino, how far do the 
budget increases for securing vulnerable nuclear weapons and civilian 
stockpile go to do the job? What are the long-term budget needs going 
to be for the United States to help secure all of the most vulnerable 
stockpiles globally?
    Answer. Vulnerable nuclear fissile materials include highly 
enriched uranium (HEU) and plutonium whose physical protection is not 
on par with international standards (e.g., the IAEA guidelines 
published in INFCIRC/225/rev.4) or is otherwise judged to be at risk 
due to the particular threat environment in the country. Consistent 
with the President's April 5, 2009, speech in Prague, the 
administration is working to identify priorities for expanding and 
accelerating U.S. nonproliferation and nuclear security efforts to 
address these vulnerable nuclear materials overseas. NNSA fully 
supports the President's fiscal year 2010 budget request for 
nonproliferation and nuclear security work overseas as it allows us to 
address the highest priorities in achieving the President's 
unprecedented global nuclear security vision. In terms of the long-term 
budget needs for addressing vulnerable nuclear materials worldwide in 4 
years, the administration will continue efforts to identify remaining 
priorities and requirements.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett

    NOT ALL SCIENCE FUNDING IS EQUAL--ESPECIALLY AT THE WEAPONS LABS

    Question. Mr. D'Agostino, I am troubled by the disparity in funding 
for applied and fundamental scientific research provided by DOE Office 
of Science labs versus the NNSA labs. Clearly, the cancellation of the 
Los Alamos Neutron Science Center (LANSCE) Refurbishment is the most 
glaring example of the selectiveness of the research funding in the 
budget. The LANSCE facility is the scientific cornerstone of Los 
Alamos, serving both classified and unclassified work and supporting 
over 500 users annually.
    How do you explain the failure in the budget to link the DOE and 
NNSA science?
    Answer. The DOE Office of Science budget is devoted to supporting 
basic science facilities, personnel, and grants that will impact broad 
missions. The NNSA budget has a technically broad but specific mission 
and must balance the fundamental and applied science required for 
stockpile stewardship with the equally important work required for 
directly maintaining the stockpile, and all of the associated 
infrastructure, security, and environmental compliance for the nuclear 
weapons complex. With increasing costs and flat or decreasing budgets, 
we have consequently had to balance investments in research needed to 
address future concerns in order to address immediate stockpile issues 
and aging infrastructure.
    Question. What do you see as the scientific future for Los Alamos 
LANSCE?
    Answer. The principal Stockpile Stewardship (SSP) experiments at 
LANSCE involve conducting measurements of nuclear data for use in 
improving the accuracy of the simulation of nuclear weapon detonations 
and proton radiography of high explosive driven materials. While some 
of these capabilities exist, in part, at other facilities it would be 
necessary to make significant investments at several facilities in 
order to conduct the SSP relevant experiments currently performed at 
LANSCE. The ability to perform classified experiments, experiments that 
utilize high explosives, and stockpile relevant materials all in one 
place is a unique aspect of LANSCE. The Office of Science continues to 
use LANSCE for isotope production, neutron scattering, and materials 
science and we expect this work to continue for the foreseeable future.
    Question. What are your plans for conducting this work after the 
accelerator is gone?
    Answer. We do not plan to close the accelerator. While we plan to 
continue to operate the accelerator for the foreseeable future, it 
isn't really possible to know how long the accelerator will be able to 
operate without refurbishment. The decision on whether to re-invest in 
the infrastructure at LANSCE will be deferred until after fiscal year 
2010. All of the individual components are in principle repairable 
indefinitely, assuming parts are available, but in practice we expect 
that the reliability of the facility will decay without further 
investment. Without aspects of the refurbishment in some form yet to be 
determined, we are accepting increased risk of major component failures 
affecting continued operations.

       STRATEGIC POSTURE COMMISSION--INVESTMENT IN INFRASTRUCTURE

    Question. Mr. D'Agostino, the bipartisan consensus of the Perry/
Schlesinger Strategic Posture Commission Report was that total 
disarmament is unlikely in the foreseeable future. As such, the 
Commission recommends the NNSA undertake a focused investment strategy 
to ensure a capability is in place to respond to unforeseen military 
challenges and maintain the extended deterrent for our allies.
    The foundation of that capability is the completion of the CMR-
Replacement facility (Los Alamos) and the UPF Facility at Y-12 (Oak 
Ridge, TN). These facilities replace 1950's era facilities that are not 
protective of worker health and safety, and the Defense Nuclear 
Facilities Safety Board recommends they should be closed as soon as 
possible.
    Given the unique responsibility of each facility and likelihood 
that the United States and Russia won't agree to eliminate their 
respective stockpiles when do you anticipate making a decision on the 
fate of these facilities and what are the decision drivers for this 
decision?
    Answer. Our recently submitted fiscal year 2010 budget reflects a 
transition year for Weapons Account Activities while we complete the 
administration's Nuclear Posture Review (NPR). We are presently 
continuing design work for CMR-Replacement and UPF but have not 
included future construction funding pending recommendations from the 
NPR. I anticipate the fiscal year 2011 budget to be submitted to 
Congress in February 2010 will reflect our decision approach relative 
to these two major nuclear facilities.
    We recognize the need to replace the existing 1950's era facilities 
as rapidly as practical. The drivers for our decision will include the 
specific recommendations in the NPR and our judgment on how to best 
balance the competing needs of our enterprise given the available 
resources. We must achieve the correct balance between sustaining our 
science and technology base, refurbishing or modernizing our stockpile, 
and recapitalizing major facilities that would include constructing the 
CMR-Replacement and UPF.
    Question. Recent press articles reported that the budget request is 
not adequate to sustain the existing design teams and would force 
layoffs. Do you believe this budget request would result in layoffs and 
contribute to further project delays at either of these facilities?
    Answer. Yes. The proposed fiscal year 2010 funding plan will result 
in lower staffing levels for the design teams for CMRR and UPF than 
previously planned. The delay in funding pending the strategic 
decisions of the Nuclear Posture Review (NPR) and related 
considerations will make completion of both projects later than 
originally planned. The administration plans to make decisions about 
these two projects in the broader context of the NPR.
    Question. Your budget will delay the completion of the RLUOB by 1 
year based on this budget estimate. How much more funding is needed to 
complete this facility including acquisition of equipment and 
installation to maintain the current schedule of 2010?
    Answer. The RLUOB will complete construction in September 2009 and 
be equipped and made ready during 2010-2012, with the schedule 
controlled by equipment delivery. The costs of acquisition and 
installation of the RLUOB equipment and related scope to bring the 
facility up to operations are currently estimated at about $199 
million, of which approximately $36 million has been appropriated 
already. The President's budget request plus previously appropriated 
funds adequately support RLUOB and its equipment.
    Question. How much is needed to fund a new start on UPF and CMR-R?
    Answer. NNSA does not contemplate a ``new start'' for either 
project in fiscal year 2010 because the designs are not yet complete. 
The fiscal year 2010 funding request will allow both projects to make 
some design progress and avoid the need for a re-start. The funding 
levels in fiscal year 2010 balance sustaining continuity of the 
projects with minimizing commitment of resources until after completion 
of the Nuclear Posture Review.
    Question. The Defense Nuclear Facilities Safety Board also stated 
unequivocally that NNSA needs to get out of both the CMR and Y-12 
facilities. As a result of the delays created by the budget request, 
what will you tell the Defense Board, the scientists, and staff working 
in the old facilities that fall below the required structural and 
health and safety standards?
    Answer. The CMR facility at Los Alamos and the uranium processing 
facilities (9212/9215) at Y-12 are old, past-end-of-life facilities. 
Although these facilities are about 60 years old, we are maintaining 
and operating these facilities in a safe and secure manner. Over the 
past decade, we initiated actions and took proactive steps to reduce 
the hazards at these facilities. For example, improvement of facility 
safety systems, reduction of nuclear material inventories, 
implementation of new safety controls, etc., were some of the actions 
taken to enhance both the public and worker safety. This approach, 
however, does not fix the root problem of end-of-life infrastructure 
and is a temporary approach. Additional infrastructure investments will 
be needed to continue to safely operate these facilities until 
replacement facilities become available.
    Until replacement facilities are available for both CMR and Y-12 
facilities, we will continue to safely operate and maintain the 
existing facilities but at increasing costs, and manage increasing 
program vulnerability and safety risk. At CMR, risk reduction steps are 
being implemented through the CMR Facility Consolidation and Risk 
Mitigation Program. At Y-12, risk mitigation activities will be 
implemented through investment in the Facility Risk Reduction Program. 
In the absence of a decision on replacement facilities, dedicated 
commitment for increased operations funding would be required to 
continue to safely operate these facilities.
    transferring the tritium mission is a waste of taxpayer dollars
    Question. Mr. D'Agostino, last year, an independent study of the 
proposed transfer of the tritium R&D and design missions found that 
there was ``no programmatic or economic justification for closing down 
the LANL tritium R&D facility and reestablishing the capabilities at 
the Savannah River tritium site.''
    It is my understanding that the NNSA's Navy and Air Force customers 
are not convinced this transfer makes sense and find no justification 
for the move.
    Also, General Smolen, who was your deputy at the NNSA, recently 
stated in the press that ``There's really not any huge cost savings one 
way or another.'' He went on to say that the reason behind the decision 
was related to work-load leveling.
    As you are undoubtedly aware, the Senate included language in the 
supplemental stopping the transfer until an independent analysis can be 
performed of this decision and we can better understand the NNSA's 
rationale for this costly and unjustified decision.
    What was the rationale for the NNSA ignoring the TechSource study 
recommendation which advised against moving the tritium missions?
    Answer. We do not believe the TechSource study advised against 
moving the tritium missions as much as it stated that such a move 
should have a programmatic or economic justification, considering the 
importance of the GTS mission. The TechSource study provided useful 
recommendations for mitigating risks during the transition, and these 
have been incorporated into our implementation planning.
    Question. Do you support General Smolen's argument that work-load 
leveling was the rationale for this decision?
    Answer. Work-load leveling may be a benefit of this transition, 
however there are two other significant benefits. The first has to do 
with the potential for Sandia to provide a more integrated system 
architecture, incorporating GTS into the other non-nuclear subsystems. 
The second is that, as time goes on, it may no longer be possible to 
maintain a critical mass of technology staffs at multiple locations. 
While it may be possible to support two design agencies today, and to 
support two R&D centers that load and handle bulk quantities of 
tritium, we anticipate that future downsizing of the enterprise will 
force us to choose to have only one DA and one tritium R&D center of 
excellence. It seems prudent to plan ahead for this eventuality rather 
than to cope with it after the opportune time for transition has past. 
With the Savannah River Site having been established as the Tritium 
Center of Excellence, closer coordination of the R&D enterprise with 
the production facility is expected to be an advantageous initiative.
    Question. Will the tritium GTS mission be impacted by the Nuclear 
Posture Review?
    Answer. The likely outcome of the NPR is expected to lend further 
support to the GTS transition decision. Projected future workloads do 
not support keeping highly specialized technical expertise at multiple 
sites, and more leveraging of talent will be required to support system 
needs. The mechanical and materials knowledge will need to be applied 
across multiple component sets. As the NPR relates to stockpile size, 
our expectation is that the GTS DA and tritium R&D missions and 
workloads will not be significantly affected. Considering the range of 
probable recommendations, we will still need to support GTS 
technologies that are currently deployed, and to make further 
improvements to the reliability, safety, and surety of GTS units in the 
future. Reductions in the quantities of systems deployed or developed 
will not result in proportional reductions in the need for GTS field 
support or development but may constrain the resource base available to 
support these missions.
    Question. Dr. Seymour Sack sent a letter to Mr. D'Agostino on Feb 
8, 2008 to which a response was sent. Can you please forward a copy of 
Dr. Sack's letter regarding transfer of the tritium gas transfer system 
to my office or the Senate Security Office if it is classified?
    Answer. Yes. We did receive Dr. Sack's letter addressing his 
concerns with our decision process. We will provide a copy of Dr. 
Sack's letter as well as our response.

     DOES THIS ADMINISTRATION SUPPORT IMPROVED WEAPONS USE-DENIAL 
                              STRATEGIES?

    Question. Given the importance of the B61 to sustaining a safe, 
secure and reliable nuclear deterrent for the United States and its 
allies, the NNSA has made a decision to proceed with the B61 Life 
Extension Program. I have two concerns with your budget request. The 
first, it fails to provide sufficient funding to support a full 
feasibility study of both nuclear and non-nuclear parts as requested by 
the Air Force. Second, it fails to evaluate the option to integrate 
state-of-the-art use control devices. I believe it is important that 
the weapons we do retain have the best safety and security features 
built into them.
    Does the administration support adding more state-of-the-art safety 
and security features to our nuclear weapons systems like the B61?
    Answer. NNSA is committed to improving the surety (safety, security 
and use control) of the nuclear weapons stockpile at each insertion 
opportunity. This commitment meets the national imperative to ensure an 
adversary, either a nation or terrorist, never obtains a functional 
U.S. nuclear weapon. U.S. Presidents have consistently articulated this 
imperative through directive or policy such the National Security 
Presidential Directive 28 and more recently articulated by our 
President in the speech he delivered in Prague, April 2009.
    As directed by the Nuclear Weapons Council, the Phase 6.2 life 
extension study for the B61 Mods 3, 4, 7, and 10 bombs began in 
September 2008, and we are evaluating, within existing funding 
constraints, the inclusion of state-of-the-art surety features in both 
the non-nuclear and nuclear systems during the study.
    Question. How much more would it cost to expand the feasibility 
study to include adding safety and surety features to the physics 
package?
    Answer. The NWC has directed a study including improving surety of 
the nuclear explosive package (NEP). NNSA estimates that an additional 
$30 million in fiscal year 2010 would be needed to fully support the 
addition of the nuclear scope to the study. This includes the study of 
options to add improved safety, security and use control to the NEP. 
This additional scope and resources are needed to complete the 
feasibility study in fiscal year 2010 and align the program to achieve 
a first production unit by 2017. Alignment between the NNSA and DOD is 
essential to providing the needed capability.
    Question. Since this is an Air Force weapon, can you tell me what 
their preference would be regarding the expansion of this study to 
include the physics package?
    Answer. During an April 2009 senior-level review, the Air Force and 
other DOD representatives made it clear that it is a priority for NNSA 
to include the NEP in the B61 life extension study. In addition, senior 
Air Force officials have communicated with the Secretary of Energy, the 
NNSA Administrator, and congressional staff their strong endorsement of 
adding enhanced safety and security features within the nuclear 
explosive package.

                           ADVANCED COMPUTING

    Question. Supercomputing is another success of Stockpile 
Stewardship. You have the fastest computer in the world, and NNSA has 
achieved modeling and simulation capabilities that many thought 
impossible.
    The Defense Science Board conducted a study of the Advanced 
Computing program and was very complimentary of the achievements in 
this program to develop a predictive and simulation capability and 
drive innovation in the advanced computing architecture.
    The Defense Science Board study concluded that the existing budgets 
are inadequate to achieve the milestones established by the NNSA.
    Can you please provide the subcommittee with a list of the current 
milestones and the status of each and what impact the budget request 
will have on each milestone?
    Answer. Computer simulation underpins our ability to certify 
weapons in the absence of testing, as well as meet our broad national 
security responsibilities. ASC planning is based in part on the urgency 
of developing predictive tools while experts still reside in the 
complex. The ``milestones'' in the ASC Roadmap (2006) to which the 
Defense Science Board (DSB) report refers are actually stretch goals 
along the pathway set forth in four focus areas necessary to meet 
national security simulation needs. These target goals include, for 
example, developing science-based replacements for (ad hoc models) 
Knobs #1-4 in the 2009-2016 timeframe, attaining a 100x petascale 
computing capability in 2016, an exascale computing capability in 2018, 
and a 50 percent improvement in setup-to-solution time for significant 
finding investigation (SFI) simulations. The knob-removal goals are key 
stockpile stewardship objectives and have been incorporated into the 
Predictive Capability Framework (PCF) that integrates activities of the 
NNSA simulation, science and engineering campaigns. The target date for 
achieving these stretch goals may change depending on funding or as 
more insight is gained about the problems.
    The NNSA has decided to keep the 2010 budget for science level with 
2009 pending outcome from the Quadrennial Defense Review (QDR) and the 
Nuclear Posture Review (NPR). To some degree, the declining funding 
that the DSB reviewed has been stemmed. However, their question about 
how the ASC program intends to meet roadmap stretch goals in a timely 
fashion, such as achieving exascale computing by 2018 to support 
stockpile stewardship, remains a legitimate concern.
    Question. What is your plan for developing the next generation of 
computers and how is this effort specifically being coordinated with 
the Office of Science?
    Answer. There has been an ongoing R&D partnership between ASC and 
DOE Office of Science's Argonne National Laboratory (ANL) to develop 
advanced supercomputers based on the BlueGene P/Q architecture. 
However, this level of collaboration and associated funding will not 
achieve exascale computing. Developing the next generation of 
(exascale) computers will be a significant challenge, more difficult 
than the first effort under ASCI to develop a 100 teraFlop 
computational capability. Machines at the exascale will require 
radically new ways of thinking about computer architectures and ways to 
program applications.
    We recognize that this is a challenge beyond the scope of ASC alone 
within current funding projections, and that it will require a 
Government-wide solution. To this end we have taken the first steps to 
establish a collaboration with the Office of Science to make exascale 
computing a reality. This joint collaboration was announced at the June 
2009 Scientific Discovery through Advanced Computing (SciDAC) 
Conference in San Diego, CA, and a steering group has been formed. The 
first task for the steering group is to report to the ASCR and ASC 
programs the scope of what needs to be done to achieve exascale 
computing. Once identified, the scope could require focused investments 
for a period of time to be successful. The programs' intent is to work 
together through shared investments towards a common goal of achieving 
exascale computing by the end of the next decade.
    Question. And, what is your plan for ensuring that the 
sophisticated computer codes and models that you have in place now will 
be able to be run on these new generations of supercomputers?
    Answer. Generally, our modern-multiphysics codes are continuously 
updated. Portions of the codes that can best take advantage of the new 
architectures are modified to do so. Writing code can take years to 
achieve, and must be well planned and synchronized with evolving 
technologies. Consequently, ASC must be intimately involved with the 
technology frontier. Our approach ensures that the power of the 
supercomputers is available to users of the existing code base; it 
provides a reliable but very modest improvement in code and model 
performance. By adopting this incremental approach, risk that our codes 
and models will not be available is minimized.
    This approach will likely not be sufficient as we approach exascale 
computing. But, at this time it is premature to project what will be 
needed to move our codes to an, as yet, unknown architecture. Our 
planning will be synchronized with architectural designs as they 
mature. At that time we will make the traditional trade-offs between 
advancing the current codes, freezing development until transitioning 
is complete, or accelerating the transition by expanding the work 
scope. While we generally have not had to rely on expanding work scope 
in the recent past, this scenario is more likely as we approach 
exascale, which will dictate the need for additional funding for a 
limited term initiative in future years.
    Question. Can you please provide the subcommittee with a project 
data sheet on for the Zia and Sequoia machines, including cost, 
schedule, and mission justification?

                              PART 1--ZIA

    Answer. The DOE NNSA ASC Program requires a production capability 
computing system in 2010 to run extensive, high-fidelity integral 
calculations of high-priority applications within the Complex to 
support the national Stockpile Stewardship Program. The Zia capability 
system will replace the ASC Purple system for existing simulation codes 
as the next national user facility for computing across the tri-labs. 
This system will provide a capability class resource to the ASC 
simulation community for the 2010-2015 timeframe.
    Zia has a 3-year schedule, with delivery of the platform scheduled 
for Q3 fiscal year 2010 and assume the national user facility workload 
by the beginning of fiscal year 2011. The funding profile for Zia is as 
follows: fiscal year 2008--$0; fiscal year 2009--$15 million in budget, 
$0 spent with project at CD-1; fiscal year 2010--$42.36 million; fiscal 
year 2011--$14.6 million.

                            PART 2--SEQUOIA

    The Sequoia mission need is to run both high-fidelity science 
calculations and three-dimensional uncertainty quantification (UQ) 
calculations. In addition, Sequoia is an advanced architecture system 
that will push the state of the art on the road to exascale computing. 
It will provide the processing power necessary to run the most resolved 
calculations required by the weapons codes as they will exist between 
2011 and 2016.
    The scope of this project covers acquisition of Sequoia 
computational resources and related I/O infrastructure, platform vendor 
build contract, platform vendor development and engineering (D&E) 
contract, and an I/O infrastructure D&E contract. In addition to the 
2011 system delivery, the Sequoia contract will provide a smaller, but 
significant, initial delivery (ID) environment beginning in 2008 to 
permit the necessary scaling and code development to ensure effective 
use of the final platform.
    Sequoia has an extended 5-year schedule, with delivery of the final 
system scheduled for Q1 fiscal year 2012. The Future Years Nuclear 
Security Plan (FYNSP) funding profile for Sequoia is as follows: fiscal 
year 2008--$15 million; fiscal year 2009--$54 million in budget, $42 
million spent; fiscal year 2010--$14.5 million; fiscal year 2011--$38.7 
million; fiscal year 2012--$51.8 million; fiscal year 2013--$43.0 
million.

     CUT TO NONPROLIFERATION AND DETECTION RESEARCH AND DEVELOPMENT

    Question. Mr. D'Agostino, the budget request cuts the nuclear 
detection R&D budget by $66 million. This funding is critical to 
maintaining the technological advances to detect and monitor 
clandestine nuclear program or to catch smuggling of nuclear materials. 
In light of the activities in North Korea and Iran, it seems this 
funding reduction should be reconsidered.
    What is the rationale for this reduction?
    The apparent ``reduction'' of $66 million comes from comparing the 
fiscal year 2010 budget request with a fiscal year 2009 appropriation 
that was significantly higher than the fiscal year 2009 budget request. 
The administration's fiscal year 2010 budget request is greater than 
the fiscal year 2009 request.
    Question. Recent reports, including the Strategic Posture Review 
and the Council of Foreign Policy, recommended increased funding for 
forensic research and attribution. Can you please describe how this 
program is investing in our forensic and attribution capabilities and 
what long term investments in NNSA facilities aside from the 300 Area 
at PNNL where this program is building our capabilities?
    Answer. NNSA investments include purchase of specific scientific 
instrumentation for the NNSA laboratories to advance research in post-
detonation forensics analytical methods (some examples include: laser 
fluorination isotope ratio mass spectrometer (LLNL); Cameca secondary 
ion mass spectrometer (SIMS-LANL); Los Alamos Sferic array (measures 
ground EMP)). In addition to these activities funded by the NN R&D 
program, NNSA funds national technical nuclear forensics work through 
the Nuclear Counterterrorism and Incident Response program at about $10 
million annually.
    Question. NNSA facilities provide significant and varied research 
and discovery capabilities for different users and mission need. Each 
of these facilities is costly to maintain and staff. Can you please 
tell the subcommittee how much of the annual Nonproliferation and 
Detection R&D budget contributes to operations funding at our national 
labs in both real dollar amount and as a percentage of facility 
operations.
    Answer. NNSA's Defense Nuclear Nonproliferation (DNN), Office of 
Nonproliferation and Verification R&D funding is presented as a 
percentage of estimated overall NNSA fiscal year 2009 funding to the 
listed DOE/NNSA labs. The following table is provided.

           FISCAL YEAR 2009 APPROPRIATIONS--ALLOCATED BY SITE
                      [Estimates in whole dollars]
------------------------------------------------------------------------
                                        Nonproliferation    Percent of
           Reporting Entity             and Verification     NNSA Site
                                               R&D            Funding
------------------------------------------------------------------------
Ames National Laboratory..............         $236,000           100.0
Argonne National Laboratory...........        3,275,000             6.8
Brookhaven Science Association (BNL)..        2,171,000             5.1
BWXT Pantex...........................           35,000            <0.01
BWXT Y-12.............................        2,226,000             0.3
NNSA-HQ (including SBIR)..............       11,043,129            13.2
Idaho National Lab....................        4,595,000             2.3
Kansas City Plant.....................           35,000            <0.01
Lawrence Berkley National Lab.........        5,376,000            94.9
Lawrence Livermore National Lab.......       43,184,671             4.2
Los Alamos National Lab...............       88,231,445             6.0
NNSA-Service Center (incl. University        16,622,605             1.9
 grants)..............................
NSTech................................       10,538,000             3.9
Oak Ridge National Lab................       25,306,746            18.6
Pacific North West Lab................       42,257,800            19.5
PNSO/PNNL Construction................       18,460,000            98.8
Sandia National Lab...................       73,144,604             6.7
Savannah River Nuclear Solutions......       17,054,000             6.2
                                       ---------------------------------
      TOTALS..........................      363,792,000             4.9
------------------------------------------------------------------------

    Question. What are the long term technology challenges this program 
is working to solve and what are the top research priorities in this 
budget?
    Answer. The top research priorities in this budget are divided into 
two areas. Roughly 60 percent of the budget will focus on developing 
technologies and methods to detect foreign uranium-235 production 
activities, plutonium production activities, special nuclear material 
movement and on developing Global Nuclear Safeguards technologies. The 
other 40 percent of the budget will focus on improving the Nation's 
ability to detect nuclear detonations by building the Nation's 
operational treaty monitoring space sensors, developing the regional 
geophysical capabilities to enable the Nation's ground-based treaty 
monitoring networks, and advancing technology in post-detonation 
nuclear forensics.

                   HIGHLY ENRICHED URANIUM IN RUSSIA

    Question. Mr. D'Agostino, your testimony and pronouncements of the 
administration have clearly made nonproliferation a top priority 
including the goal of minimizing the use of highly-enriched uranium in 
the civilian nuclear sector. I am supportive of those goals, although I 
am concerned about the vast amount of undeclared reserves of Highly 
Enriched Uranium (HEU) held by Russia, which is outside of the scope of 
the existing program.
    Reports vary, but it is quite possible that Russian HEU stockpiles 
make up the largest inventory of weapon-usable material held in the 
world today.
    When President Obama travels to Russia this July to sign the 
Plutonium Material and Disposition Agreement, will he press Russian 
President Medvedev to declare the size and makeup of the Russian HEU 
reserves and press for additional down blending of that material, 
whether it is used in Russia or sold internationally?
    Answer. Nonproliferation, and specifically, eliminating stocks of 
excess fissile material are key priorities of this administration. 
Coming to agreement on the terms of the Plutonium Management and 
Disposition Agreement is one important step in this effort. The 
President also has committed to seek further weapons reductions under a 
START Follow-On Treaty and to open negotiations for a Fissile Material 
Cut-off Treaty. Given the critical success of the DOE/NNSA HEU 
Transparency Program over the past 15 years to verify the disposition 
of over 368 metric tons of the planned 500 metric tons of Russian HEU, 
we would welcome the possibility of down blending additional excess 
Russian HEU. This HEU Transparency effort has been one of our most 
successful bilateral nonproliferation efforts with Russia yet in the 
area of tangibly eliminating weapons-derived material. However, to date 
the Russians have been unwilling to consider an extension beyond the 
2013 end date of this program. DOE/NNSA would certainly welcome the 
continuation of this important effort if Russia declares additional 
amounts of excess HEU beyond the initial 500 metric tons in the HEU 
Agreement.
    Question. Your budget proposes additional investment to secure 
weapons-grade material in Russia. Wouldn't you prefer that this 
material be down blended to eliminate any further threats?
    Answer. We would prefer that excess material be downblended; we are 
already working with the Russians to downblend HEU under the Material 
Consolidation and Conversion project that is not of weapons origin and 
that has been declared excess by the Russians. We think this activity 
would be a way to help Russia eliminate the risks associated with this 
and all nuclear material, as well as avoid the associated long-term 
security costs. However, some Russian sites require weapons-useable HEU 
for their operations. In those cases, our joint intent is to protect 
the material as well as possible. Central storage facilities with 
modern security systems are a good way to improve material security.

                             CYBER SECURITY

    Question. Mr. D'Agostino, I find it curious that the DOE Office of 
Electricity Transmission Delivery and Reliability received $50 million 
in additional funding for cyber security research and development, yet 
the NNSA, which has seen a tremendous increase in cyber attacks of the 
past years, and recently in the last several months, received no 
additional funding increases.
    How do you explain this funding disparity?
    Answer. Funding for all programs within DOE, to include NNSA is 
determined by the Secretary of Energy through a very prescriptive 
process. NNSA's cyber security requirements are first presented by the 
NNSA CIO to the NNSA Administrator. The Administrator, after 
determining the highest priority needs for NNSA, makes the final 
recommendation to the Secretary who makes the final corporate decision.
    Question. Are you confident that the NNSA has adequate cyber 
protections in place to protect our national security secrets?
    Answer. The threats to the national security information and 
classified system within the NNSA computing environment are constantly 
changing and represent risks to our operations. However with the 
technology enhancement (i.e. EnCase Enterprise) and process 
improvements (NNSA Policy (NAP)) NNSA have invested in over past 2 
years, I believe that we have minimized the threats to the NNSA 
computing environment and national security information and are 
operating at an acceptable level of risk. NNSA's cyber security systems 
have benefited by external independent oversight programs, such as HSS, 
with activities such as network penetration testing and reviews of 
security plans and strategies. The Department and NNSA senior 
leadership will continue to monitor the threats to our computing assets 
along with the accompanying risks in order to make necessary changes 
and provide an appropriate level of protection.

                                SECURITY

    Question. Mr. D'Agostino, several NNSA sites have suggested that 
funding of safeguards and security is inadequate to support the 
mission. Do you have any security concerns with any NNSA site or do you 
believe any of the NNSA sites lack sufficient funding?
    Answer. The fiscal year 2010 budget request is adequate to support 
the core security mission and maintain the program within acceptable 
risk levels. At the request level, NNSA sites will be able to sustain 
the security baseline program and support NNSA Enterprise-wide efforts 
to consolidate high-security assets and reduce the overall security 
footprint. In fiscal year 2010, the NNSA security program will focus on 
improving the effectiveness and efficiency of security operations 
through standardization and consistency of security program 
implementation, and upgrades to the security systems infrastructure so 
as to enable the sites to maintain performance of the security mission 
at the same or reduced funding levels in the out-years. To this end, we 
are investing in improved performance assurance programs at each site, 
with emphasis on Federal manager oversight, and have undertaken a new 
initiative (Zero-Based Security Review) with the objectives of 
establishing clear performance expectations, and issuing consistent 
policy implementing guidance. NNSA sites are, and must remain, among 
the most well-protected facilities in the world.

                             NAVAL REACTORS

    Question. Mr. D'Agostino, your budget proposes to move forward on 
an Ohio Class submarine replacement. At the same time, you have frozen 
progress on CMR-R and UPF and other facilities pending the outcome of 
the NPR.
    Why not wait on the new submarine platform until the NPR is 
complete?
    Answer. The President has reaffirmed the need to maintain a strong 
deterrent for the foreseeable future. To ensure there is no gap in 
strategic coverage when the OHIO Class SSBNs begin to retire in 2027, 
we need to start concept design studies for the OHIO Class Replacement 
in fiscal year 2010. There are key technical and schedule drivers that 
require the fiscal year 2010 start so design and technology can mature 
to support a fiscal year 2019 ship construction schedule. Early design 
studies answer questions that will arise from the NPR deliberations. 
The design parameters under consideration are aimed at accommodating 
any conceivable conclusion of the NPR. The NPR will not determine the 
design of the submarine, but rather the number of weapons and targets. 
A reduction in weapons may result in fewer missile tubes per submarine; 
however, the total number of submarines is primarily derived from the 
number required at sea at any given time to provide a survivable 
deterrent in the regions we need to cover.
    Question. How is this investment different than that of a one-of-a-
kind facility such as CMR-R and UPF, both of which are necessary in 
order to maintain the deterrent?
    Answer. There are more investment similarities than differences 
between the Ohio Class Replacement project and the CMR-R and UPF 
projects required to modernize the NNSA nuclear infrastructure. All are 
needed to sustain essential capabilities for the long-term and the 
details of NPR conclusions will not have significant impact on early 
design activities. Early design work is needed for all three in order 
to most efficiently plan for sustaining capabilities. The investment in 
the OHIO Class Replacement project differs from that in the CMR-R and 
UPF projects only in the maturity of its design. While the OHIO Class 
Replacement project will be starting its conceptual design in fiscal 
year 2010, the CMR-R and UPF projects are both currently in latter 
stages of preliminary design. The previous answer pointed out how OHIO 
Class Replacement design at its current maturity is independent of the 
NPR's conclusions. Although more mature, the designs of both the CMR-R 
and UPF projects are primarily driven by the need to maintain essential 
capabilities that are expected to provide an adequate capacity merely 
by the existence of the capability. Thus, CMR-R and UPF sizes and 
capacities are independent of the NPR's conclusions at expected future 
stockpile size ranges.

                           PENSION SHORTFALLS

    Question. Mr. D'Agostino, The stock market down turn over the past 
year has significantly reduced the DOE contractor pension value. In 
order to make up the shortfall, contractors are required to adjust 
their program charges (known as the indirect rate). According to 
figures prepared by the Department, the average total contributions 
paid to DOE contractor pension plans from 2003 to 2008 was $330 
million. In the future, DOE expects to pay on average $1.5 billion per 
year over the next 5 years. The peak contribution years are estimated 
to come in 2012 and 2013 at just under $2 billion per year. The lion 
share of the contributions coming from NNSA and Environmental Cleanup 
sites.
    Based on this 2010 budget request, it appears that the NNSA is 
facing a pension shortfall of $411 million, of which $200 million was 
not budgeted for and will further reduce mission funding. It is my 
understanding that NNSA plans to deduct most of the savings out of the 
operating budget and delay facility closures and preventative 
maintenance and the consolidation of special nuclear materials.
    This trend is simply unsustainable and will have a devastating 
impact on the weapons and nonproliferation program. Has the Department 
considered the program impacts on to scientific research, operations 
and employment levels? What actions are being taken to mitigate this 
problem over the next 5 years?
    Answer. Because the pension payments for the Defined Benefit plans 
are a function of economic conditions, the number of retirees to 
receive benefits, and largely address legacy promises of benefits, we 
are very limited in what we can do now to mitigate the problem 
indicated by the analysis. Except for a few collective bargaining unit 
Plans, the NNSA M&O contractors have closed their defined benefit 
programs to new entrants in favor of defined contributions (401K) type 
of retirement plans. As a result, there is little to be done to reduce 
costs in the DB arena, instead NNSA and its M&O contractors are seeking 
ways to better address future payments.
    The pension plans of DOE's M&O contractors have suffered losses in 
asset value similar to those in the private sector as a result of the 
business downtown in the past 12 months. Overall, their plans are in 
relatively good shape compared to the rest of industry, however, the 
recession coupled with new Pension Protection Act requirements has 
resulted in funding shortfalls for some of plans.
    Additionally, our M&O contractors continue to experience 
fluctuations in pension liabilities, and the increased liabilities 
coupled with the decrease in Plan assets has resulted in a significant 
increase in the required contributions to pension plans at some of our 
sites. NNSA is monitoring the situation to understand the projected 
shortfalls, and to mitigate the resulting impact on all of our mission 
program activities, operations and employment levels. NNSA will 
exercise all flexibility available during budget execution to manage 
site and program impacts by incentivizing operating efficiencies at the 
M&O contractors, by reallocating available funding to affected 
contractors through reprogramming of remainder funding from completed 
projects and programs; and by deferring or canceling lower priority 
activities. However, the current projections for 2011 through 2013 of 
about $1 billion shortfall annually in budgeted dollars, which are 
likely to be required to reimburse our laboratory and plant contractors 
for their payments to defined benefit pension plans, are beyond the 
ability of the NNSA to handle through increased efficiencies and 
limited reprogramming from remainders in project funding. If economic 
improvements do not materialize to mitigate these cost increases, NNSA 
may well be required to drastically cut back, and in some cases 
abandon, planned activities at our Sites resulting in the potential for 
significant workforce restructurings.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander

    Question. The President's budget request shows no construction 
funding for the Uranium Processing Facility (UPF) until 2013 which puts 
the project 3-4 years behind schedule.
    If UPF is delayed beyond its currently planned operational date of 
2018, is it reasonable to assume that the Y-12 enriched uranium 
facilities can remain safe and reliable beyond 2018?
    Answer. The President's budget request included $54,478,000 for 
Project Engineering and Design of UPF in order to advance the project`s 
design, in accordance with the requirements of DOE Order 413.3A. NNSA 
will take the steps necessary to maintain the Y-12 enriched uranium 
facilities safe and reliable until UPF becomes operational. Concrete 
measures are being taken to reduce risk at Y-12. For instance, the 
Nuclear Facility Risk Reduction Project, a multi-year effort funding 
maintenance and limited improvements, will address the safety and 
reliability of uranium facilities until UPF can be built to replace 
those facilities. While sufficient capacity exists today, the risk of 
extended shutdown is unacceptably high and safety of operations remains 
a major concern. The Uranium Processing Facility (UPF) must be built to 
alleviate the risk of shutdown, reduce costs, and provide a safe 
working environment for our nuclear security workers. Construction of 
this facility is mission critical and will take at least 7 years to 
complete. Each year NNSA is required to take measures to mitigate the 
growing risks is another year longer the Nation runs the risk of losing 
its uranium processing capability, with a commensurate impact on its 
nuclear deterrent and its ability to supply the Navy with fuel.
    Question. How long would it take for the UPF to pay for itself in 
reduced annual costs?
    Answer. Based on the current preliminary project estimates, UPF's 
payback period is approximately 10 to 15 years. The UPF project's 
contribution to safety of the Y-12 site and of the public is, however, 
the overriding justification of the project--even if the actual payback 
period is found to be longer, it would not have been acceptable to 
continue operations in the current facilities.
    Question. What is the condition of Building 9212, where the uranium 
enrichment work currently takes place? Is this facility viable for 
long-term enriched uranium mission capability?
    Answer. Building 9212 is not suitable for performing long-term 
enriched uranium services. The enriched uranium services need to be 
transferred to a facility that can support long-term sustainability and 
meet modern industrial and nuclear safety standards. The enriched 
uranium services are being conducted in Building 9212, pending 
availability of UPF. NNSA will take the steps necessary to maintain the 
Y-12 enriched uranium facilities safe and reliable until UPF becomes 
operational. Our current uranium infrastructure is obsolete, costly, 
and decrepit. The risk of extended shutdown is unacceptably high, and 
worker safety continues to be a major concern.
    Question. If there were no new nuclear weapons production or life 
extension, would UPF still be needed?
    Answer. Yes, UPF sustains capabilities that are needed as long as 
the Nation has an inventory of HEU. UPF is essential to dismantling 
weapons to support arms controls initiatives, supporting the Naval 
Nuclear Reactors Program, for down-blending excess enriched uranium for 
non-proliferation purposes, and ultimately for power and research 
reactors (i.e., Accelerator Test Facility and High Flux Isotope 
Reactor). UPF is needed to support all stockpile activities involving 
the processing of Highly Enriched Uranium (HEU), including the 
surveillance and dismantlement programs. Many studies conducted on the 
UPF design, including the recently issued Dr. Everet Beckner/TechSource 
Study, concluded that approximately 75 percent of the UPF is required 
even if no new weapon is ever built and noted that continued operations 
of the current facilities at Y-12 past 2020, in particular the 9212 
building, would require accepting an appreciably increased safety risk.
    Question. Who has reviewed the capabilities and size of the UPF 
facility?
    Answer. The capabilities and size of UPF have been assessed both 
internal and external to NNSA over the past few years. First, the Y-12 
project team and NNSA Headquarters led a review of UPF that included 
subject matter experts from across the nuclear security enterprise, 
including the national laboratories. Second, NNSA conducted a joint 
review of UPF with technical assistance provided by the United 
Kingdom's Aldermaston Weapons Establishment. Third and most recently, 
NNSA chartered an independent external review committee headed up by 
former Deputy Administrator for Defense Programs, Dr. Everet Beckner. 
As stated by Dr. Beckner in his team's final report: ``Based upon our 
review, as will be demonstrated in the following report, I am now 
convinced that given the requirements as defined, a substantial change 
of size of the facility is not warranted at this time and the project 
should move forward without further delay.''
    Question. Can the enriched uranium mission be performed anywhere 
other than Y-12?
    Answer. No, the uranium enrichment mission can not be accomplished 
at other sites without additional funding. UPF (and the facilities it 
replaces) are part of an integrated manufacturing operation that 
includes the soon-to-be-completed Highly Enriched Uranium Manufacturing 
Facility (HEUMF) and the non-nuclear operations of the Y-12 site. It is 
possible for portions of the enriched uranium mission to be met in new 
facilities at two alternative sites, the Savannah River Site (down-
blending, sweetening, reuse of material) and the Pantex Plant 
(surveillance, disassembly), but with differing schedules, costs, and 
risk levels, and with the replication at some level of the capabilities 
of other parts of Y-12's integrated operation. An Integrated Project 
Team (IPT) conducted an analysis evaluating these alternative sites and 
produced a report on Uranium Mission Transformation in July 2008. As 
part of this effort, NNSA asked the Office of the Secretary of Defense 
(OSD) Cost Analysis Investment Group (CAIG) to act as an independent 
advisor to the IPT for this comparative business case analysis. The 
total operations and transportation costs were lower for Y-12 than the 
other alternatives. A new, fully trained, and qualified workforce would 
also have to be established if the mission were to be performed 
elsewhere. Overall, the comparative risk and costs are lower for Y-12 
than the alternative sites considered. The IPT concluded that the 
uranium mission should be retained at Y-12.
    Question. Your office has been studying how best to compete the 
NNSA production contracts (Y-12, Pantex, and Kansas City Plant) that 
are expiring next year. Recently your spokesman indicated the NNSA 
leadership would review the work of the team, who provided analysis for 
this decision, over the coming months. Given you are in the window 
where a decision needs to be made soon if new contracts are to be put 
in place, can you be more specific on schedule for this action.
    Answer. The acquisition strategy is in the final review process and 
we expect a decision in the near future. The extend/compete decisions 
will require Secretarial approval.

                          SUBCOMMITTEE RECESS

    Senator Dorgan. This hearing is recessed.
    [Whereupon, at 11:08 a.m., Tuesday, June 2, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2010

                              ----------                              


                        THURSDAY, JUNE 18, 2009

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:59 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Byron L. Dorgan (chairman) 
presiding.
    Present: Senators Dorgan, Tester, Bennett, Cochran, Bond, 
and Alexander.

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

STATEMENT OF TERRENCE C. SALT, ACTING ASSISTANT 
            SECRETARY OF THE ARMY

              OPENING STATEMENT OF SENATOR BYRON L. DORGAN

    Senator Dorgan. I'm going to call the meeting to order. 
This is the subcommittee of the Appropriations Committee of the 
United States Senate, Subcommittee on Energy and Water. Today 
we're going to take testimony on the fiscal year 2010 budget 
request for the U.S. Army Corps of Engineers and the Department 
of the Interior.
    Testifying for the Corps will be Terrence Salt, Acting 
Assistant Secretary of the Army for Civil Works. Mr. Salt, 
congratulations on your appointment as Principal Deputy and 
your current assignment as Acting Assistant Secretary. I look 
forward to working with you and Ms. Darcy once she is confirmed 
on the many water resource problems that we face.
    I know that you will familiarize yourself especially with 
North Dakota water issues and know something about some of them 
already, perhaps Mississippi issues as well. But those of us 
who serve on this subcommittee have an abiding interest in 
these matters.
    Lieutenant General Van Antwerp, Chief of the Engineers for 
the U.S. Army Corps of Engineers, it's always good to see you 
and welcome. We appreciate your being here.
    Testifying for the Department of the Interior will be 
Deanna Archuleta, the Acting Assistant Secretary for Water and 
Science at the Department. Welcome to you. Congratulations, 
too, on your appointment as the Deputy Assistant Secretary for 
Water and Science and on your current assignment as the Acting 
Assistant Secretary for Water and Science. I look forward to 
working with you and Ms. Castle once she is confirmed on many 
of the western water issues.
    Michael Connor, Commissioner of the Bureau of Reclamation. 
Commissioner Connor, congratulations on your recent 
confirmation. We appreciate your being here and I know that 
you're aware I'm passionate about the issues concerning rural 
water supply, especially on the unmet promises for now nearly 
five decades in North Dakota when they built the Garrison Dam, 
and I know you'll be more familiar with those projects as well 
and perhaps already are.
    The task of talking about the Corps budget is difficult 
because we've only had the details available for about a week. 
I'm talking about the detailed budget justifications. 
Justifications were released 5 weeks after the President 
released the budget to Congress, which has made it very 
difficult for us. Every other Federal agency got their budget 
justifications to Congress with the submission of the budget.
    I understand that some of that delay was beyond the control 
of the Corps, General. For instance, I understand the budget 
justifications were not cleared by OMB until May 29. That was 3 
weeks after the budget was released. So perhaps my real beef 
here is with the Office of Management and Budget. That would 
not be a new irritation for me.
    The Corps of Engineers did not get the budget 
justifications on the Internet until June 11, and printed 
copies were not furnished until June 12, to the extent that 
they were printed. So we've had staff working on these issues 
now, but it's been difficult.
    Mr. Salt, we postponed this hearing in May because those 
details weren't available, and I thought we might have to 
postpone a second time. But we're here finally at long last to 
talk about these various issues.
    This is the second time in 4 years that this has happened, 
so it's not about the administration. It's about particularly 
OMB and the tortured mechanics that these things go through.
    The President's fiscal year 2010 budget for the Corps of 
Engineers proposes $5.125 billion, which is $277 million below 
the fiscal year 2009 enacted of $5.402 billion. This is the 
narrowest gap that we've seen for a number of years between 
current enacted amount for fiscal year 2009 and the President's 
fiscal year 2010 budget.
    When you look at the budget details on an account by 
account basis, the difference really is considerably larger 
than that. General investigations is down $68 million from the 
current year. General construction is down $424 million from 
the current year, and this certainly doesn't help us reduce the 
more than $67 billion backlog in unconstructed projects.
    The Missouri River and tributaries is down $136 million 
from the current year.
    O&M is one of the bright spots in the Corps budget with an 
increase of about $300 million. O&M has been essentially flat 
for a number of years, even though personnel costs have 
continued to rise and the inventory of Corps projects has 
continued to age, increasing maintenance needs.
    In this case, the administration has not resorted to budget 
tricks, which we've seen in many previous years. I appreciate 
that. The O&M budget that I just described is in fact a true 
increase, not some mirage, and that will be helpful.
    To provide even this modest O&M increase and get the other 
major accounts to current levels would require an additional 
$600 million. Now, the two major projects for the Department of 
the Interior under this subcommittee are the Central Utah 
Project Completion Act and the Water and Related Resources for 
the Bureau of Reclamation. Your budgets, I would say to Ms. 
Archuleta and Mr. Connor, are relatively flat compared to 
fiscal year 2009.
    The Central Utah Project Completion account is proposed at 
the same amount as the current year, and the Bureau of 
Reclamation is down $55 million from the current year. A flat 
budget, of course, is a declining budget for your agencies. 
Personnel and contract costs continue to increase each year by 
some amount. So you're accomplishing less work when you propose 
a flat budget. Unfortunately, the needs for water and power in 
the West continue to rise.
    I'm very cognizant of the very serious deficit problems we 
face in our Government. I'm also aware, though, that some 
spending is just spending, while other spending is a really 
important investment which provides dividends for the future. 
Much of the investment we make in water projects and 
reclamation projects produce significant deficits and great 
assets for this country.
    So it's not escaped my notice that we really need to 
evaluate on a line by line basis what our needs are, what our 
responsibilities are, and what kinds of funding we will have 
available for them.
    I know that you come to us today as members of the 
administration, destined to support and required to support the 
budget that has been sent to us. In fact, only in recent years 
on one occasion have we had someone in a complete fit of candor 
and unbelievable truthfulness say: No, I'm sitting here at the 
table and the amount of money that's been requested is far 
short of what is really needed. We were staggered to hear that 
kind of testimony, and the next morning that person was fired.
    So my expectation is that you will pay fealty to the budget 
you're here to support today but you will hear from members of 
our subcommittee that in these areas of water projects and the 
Corps of Engineers' needs and responsibilities as well as the 
Bureau's responsibilities, that many of us have very 
significant and strong feelings about how to meet those 
obligations.
    I want to be able to get to you so that you can give us 
your statements, but I want to talk just for a moment about the 
American Recovery and Reinvestment Act. I was surprised that 
the request from the administration on an economic recovery act 
to try to lift the country's economy, which as you know was 
controversial--some voted for it, some didn't--included not one 
penny from the administration for either of your agencies. I 
was pretty surprised by that.
    It seems to me that if you're going to do something to 
substantially address infrastructure problems and put people 
back to work and have an asset when it's completed, one of the 
things you would look at would be water issues, water projects, 
and reclamation projects. But there wasn't any funding in the 
initial request.
    Senator Cochran and I and others included funding in this 
economic recovery package for water projects, then left it to 
your agencies to decide how the funding that we finally put 
together would be distributed. We believe we gave pretty clear 
guidance, without earmarking, how funding should be 
distributed, both in the legislation as well as in report 
language.
    But we have some concerns about how the distribution of 
that funding was developed behind closed doors. So we'll talk 
some about that today.
    Let me thank you for being here. I have other things I will 
put in the record that describe some of our interests and some 
of our concerns.
    Let me now call on my colleague from Mississippi, Senator 
Cochran, for any comments he wishes to make.

                   STATEMENT OF SENATOR THAD COCHRAN

    Senator Cochran. Mr. Chairman, thank you. Thank you for 
convening this important hearing to review the administration's 
fiscal year 2010 budget request. I'm pleased to join you in 
welcoming this panel and to thank them for appearing here 
before the subcommittee today.
    The Corps of Engineers has a very large presence in my 
State. Flood control activities on the Mississippi and Yazoo 
Rivers, dredging of ports on the Mississippi River and in the 
gulf coast region, and environmental infrastructure projects 
are all very important activities that affect the economic 
future of our State and the physical survival of our citizens.
    I'm concerned that the budget we are reviewing today might 
not adequately address some of these most important needs. But 
I would like to take the opportunity to compliment the efforts 
of the Corps of Engineers, the Mississippi Coastal Improvements 
Program team, specifically in Mobile, Alabama, for completing 
the plan to implement hurricane mitigation projects and to 
restore Mississippi's barrier islands.
    The plan the team has provided is a much needed project 
that is essential to protect the vast natural resources as well 
as property of the State of Mississippi and its citizens and to 
help protect infrastructure and commerce along the Gulf of 
Mexico.
    General Van Antwerp, as the Chief of Engineers I know you 
understand it is your charge to verify the final version of 
this plan. It's my hope that you will be able to certify the 
proposal expeditiously after a careful review of its merits.
    I would also like to compliment the Engineer Research and 
Design Center of the Army Corps of Engineers. The research 
undertaken at this facility is of the highest importance to our 
Nation and our armed forces. Once again, the center was named 
the Army's top research laboratory, an honor that is often 
bestowed on the researchers and staff in Vicksburg, 
Mississippi. We are very proud of all of them.
    The Civil Works Division of the Army Corps of Engineers has 
a unique history. It's vital to our Nation's infrastructure 
protection and it's very important that we in Congress 
recognize both the importance of the work done by the Corps of 
Engineers and carefully review the costs and other challenges 
that these projects may face.
    We thank you again for your cooperation with this 
subcommittee and I look forward to your testimony.
    Senator Dorgan. Senator Cochran, thank you very much.
    I wanted to make one additional point before I recognize 
the witnesses, and that is the question of earmarks. I'm 
speaking explicitly about the President's request coming 
through the agencies of what it is you wish to have funded--
your earmarks--and the metrics that you use to determine that, 
and the concern that many of us have how these things change 
year to year. The criteria for budgetable projects switch from 
one year to the next, depending on the administration, and even 
changes inside the same administration. For example, shifting 
views on shore protection projects, the way major 
rehabilitation projects and environmental compliance activities 
have bounced among various accounts, rural water projects are 
funded one year, next they are not funded, even the way the 
benefit-to-cost ratio is chosen to determine budgetable 
projects moves up and down on the list.
    Again, these are all earmarks chosen by someone, and 
ultimately the President. But someone in your agencies, through 
OMB, decides to earmark all this money and then send the 
earmarks to Congress and say: We've made these decisions about 
what our priorities are; that's how we've earmarked it; but we 
have our own metrics with which to make the decisions. We up 
here look at them and think: Well, why do those metrics change 
so much from one year to the next with shore protection or 
water projects and so on?
    We don't quite understand that, and we hope that we can 
begin a discussion with you about how you decide on what 
earmarks you request, what those metrics are, and whether those 
metrics can perhaps see the light of day so that we understand 
them a bit better.
    Well, let me thank all of you for being here and let me 
begin, Mr. Secretary, with your testimony. Terrence Salt, 
Acting Assistant Secretary of the Army for Civil Works, thank 
you for being with us.

                     STATEMENT OF TERRENCE C. SALT

    Mr. Salt. Sir, thank you, Chairman Dorgan, Senator Cochran. 
Thank you for the opportunity to present the President's budget 
for the Civil Works Program of the Army Corps of Engineers for 
fiscal year 2010. I will also briefly touch on the activities 
related to the stimulus bill.
    In developing this budget, we have sought to achieve four 
principal objectives: the first, to focus construction funds on 
those investments that provide the best return from a national 
perspective in achieving economic, environmental, and public 
safety objectives;
    Second, to support the safe and reliable operations and 
maintenance of key existing water resources infrastructure;
    Third, to improve Corps project planning and program 
performance;
    Finally, to advance aquatic ecosystem restoration efforts, 
including the restoration of Louisiana's coastal wetlands and 
Florida's Everglades.
    The budget provides funding for the development and 
restoration of the Nation's water and related resources within 
the three main Civil Works program areas. Sir, you mentioned 
the commercial navigation, flood and coastal storm damage 
reduction, and aquatic ecosystem restoration.
    Additionally, the budget supports hydropower, recreation, 
environmental stewardship, water supply services at existing 
water resource projects owned or operated by the Corps, 
protection of the Nation's regulated waters and wetlands, the 
cleanup of sites contaminated as a result of the Nation's early 
efforts to develop atomic weapons, and emergency preparedness 
and training.
    As you pointed out, the total discretionary funding of 
$5.125 billion in the fiscal year 2010 budget is our budget 
and, although it is less than was previously appropriated last 
year, it is the highest amount ever requested by the President 
for the Civil Works Program.
    The budget proposes enactment of legislation to authorize a 
lock usage fee which would, over time, replace the diesel fuel 
tax now paid by most commercial users of the inland and intra-
coastal waterways. This proposed legislation will address the 
declining balance in the Inland Waterways Trust Fund. This 
affects the Government's ability to finance the non-Federal 
portion of Federal capital investment in these waterways and 
will do so in a way that improves economic efficiency compared 
to the existing fuel tax by more closely aligning the costs of 
those who use the Corps locks for commerce with the capital 
costs that the Corps incurs on their behalf.
    The administration stands ready to work with the Congress 
and stakeholders with interests in these capital investments to 
help pass and implement this proposal.
    The fiscal year 2010 budget continues the Civil Works 
Program's commitment to a performance-based approach to 
budgeting. The Army applied objective performance guidelines to 
focus construction funds on these investments within the three 
main mission areas of the Corps that provides the best return 
from a national perspective in achieving economic, 
environmental, and public safety objectives.
    Similarly, the Army used objective performance criteria to 
allocate O&M funds in the fiscal year 2010 budget. The O&M 
criteria consider both the condition of the project and the 
potential consequences for project performance if the O&M 
activity were not undertaken in fiscal year 2010.
    In fiscal year 2010, the court will focus efforts on 
developing new strategies along with other Federal agencies and 
non-Federal project partners, to better manage, protect, and 
restore the Nation's water and related land resources, 
including flood plains, flood-prone areas and related 
ecosystems.
    I'd like to speak for a minute about the recently enacted 
American Recovery and Reinvestment Act, which provided $4.6 
billion for the Corps' Civil Works Program. The Corps is 
managing these funds and successfully achieving the Recovery 
Act's stated purposes. Obligations and expenditures commenced 
in early May. Upon clearance of the Corps' project plans and 
lists, projects were selected based on the fundamental tenet of 
prudent management and investment in infrastructure and the 
ecosystem restoration projects that will provide long-term 
benefits for the Nation.
    The Civil Works allocations are fully consistent with the 
President's direction provided in his executive memorandum of 
March 20, 2009, ensuring responsible spending of Recovery Act 
funds. Moreover, the Civil Works allocations are consistent 
with additional project selection criteria provided in the 
conference committee report accompanying the act that projects, 
programs, or activities that are accomplished with Recovery Act 
dollars will be obligated and executed quickly, will result in 
high immediate employment, have little schedule risk, will be 
executed by contract or direct hire of temporary labor, and 
will complete a project phase, a project, an element, or will 
provide a useful service that does not require additional 
funding.
    Also, as stipulated in the Recovery Act, no funds will be 
used for any project that at the time of the obligation has not 
received appropriations provided for energy and water 
development--essentially no new starts.
    The wide geographic distribution of projects spreads the 
employment and other economic benefits across the United 
States. Funding is also distributed across Civil Works programs 
to provide the Nation with project benefits related to inland 
and coastal navigation, the environment, flood risk management, 
hydropower, recreation, and more.
    I'm pleased to report that as of the close of business June 
12, 2009, the Corps has obligated more than $320 million, work 
on the ground has begun, and real progress is being made.
    In conclusion, this administration has made rebuilding 
America's infrastructure a priority. Through resources provided 
for the Army Civil Works program in the President's budget for 
fiscal year 2010, as well as the resources provided through the 
stimulus bill, the Corps can help achieve this objective.

                           PREPARED STATEMENT

    Mr. Chairman, I am proud to support this budget for the 
Army's Civil Works program. I look forward to working with this 
subcommittee and to your support of the President's budget 
proposals, and I welcome any questions you may have.
    Thank you, sir.
    [The statement follows:]

                 Prepared Statement of Terrence C. Salt

    Chairman Dorgan, Senator Bennett, distinguished members of the 
subcommittee, thank you for the opportunity to present the President's 
budget for the Civil Works Program of the Army Corps of Engineers for 
fiscal year 2010.

                                OVERVIEW

    In developing this budget, we sought to achieve four principal 
objectives:
  --Focus construction funds on those investments that provide the best 
        return from a national perspective in achieving economic, 
        environmental and public safety objectives;
  --Support the safe and reliable operation and maintenance of key 
        existing water resources infrastructure;
  --Improve Corps project planning and program performance; and
  --Advance aquatic ecosystem restoration efforts, including 
        restoration of Louisiana's coastal wetlands and Florida's 
        Everglades.
    The budget provides funding for development and restoration of the 
Nation's water and related resources within the three main Civil Works 
program areas: commercial navigation, flood and coastal storm damage 
reduction, and aquatic ecosystem restoration. Additionally, the budget 
supports hydropower, recreation, environmental stewardship, and water 
supply services at existing water resources projects owned or operated 
by the Corps. Finally, the Budget provides for protection of the 
Nation's regulated waters and wetlands; cleanup of sites contaminated 
as a result of the Nation's early efforts to develop atomic weapons; 
and emergency preparedness and training. The budget does not fund work 
that should be the responsibility of non-Federal interests or other 
Federal agencies, such as wastewater treatment and municipal and 
industrial water treatment and distribution.

             FISCAL YEAR 2010 DISCRETIONARY FUNDING PROGRAM

    The total discretionary funding of $5.125 billion in the fiscal 
year 2010 budget is the highest amount ever requested by the President 
for the Civil Works program.
    Within this total, $1.718 billion is budgeted for projects in the 
Construction account. The budget provides $2.504 billion for activities 
funded in the Operation and Maintenance (O&M) account.
    The fiscal year 2010 budget also includes $100 million for 
Investigations; $248 million for Flood Control, Mississippi River and 
Tributaries; $41 million for Flood Control and Coastal Emergency; $190 
million for the Regulatory Program; $134 million for the Formerly 
Utilized Sites Remedial Action Program; $184 million for the Expenses 
account and $6 million for the Office of the Assistant Secretary for 
Civil Works.
    Enclosure 1 displays the current estimate for the distribution of 
fiscal year 2010 discretionary funding among eight appropriation 
accounts, eight program areas plus executive direction and management, 
and five funding sources including the general fund of the Treasury and 
trust funds. Enclosure 2 is a crosscut between appropriation accounts 
and program areas.
    The fiscal year 2010 budget for the Civil Works program supports 
high performing new studies and construction starts.
    The budget funds three new watershed studies: Green River 
Watershed, Kentucky; Ocmulgee River Watershed, Georgia; St. Louis 
Watershed, Missouri; and a study addressing Access to Water Data. The 
budget also includes $2 million for a high-priority, interagency 
evaluation of the Nation's vulnerability to damage from flooding, the 
Water Resources Priorities study, as authorized in section 2032 of the 
Water Resources Development Act of 2007 (WRDA 2007).
    The budget also includes funding for five construction starts, 
namely Napa River Salt Marsh Restoration, California; Kansas City's, 
Missouri and Kansas flood damage reduction project; Washington, DC and 
Vicinity flood damage reduction project; Norfolk Harbor, Craney Island, 
VA; and the Bridges at Deep Creek, Virginia project on the Atlantic-
Intracoastal Waterway.
Restoring Louisiana Gulf Coast Wetlands
    For fiscal year 2010, the allocation for the Louisiana coastal area 
(LCA) has been increased by $5 million, from $20 million to $25 million 
in the Investigations account. Over 1 million acres of Louisiana's 
coastal wetlands have been lost since the 1930's; another one-third of 
a million acres could be lost over the next 50 years unless large-scale 
corrective actions are taken. A 10-year plan of studies, projects and 
science support was developed through a public involvement process, and 
working closely with other Federal agencies and the State of Louisiana. 
All construction activities under the plan will be subject to approval 
of feasibility level of detail documents by the Secretary of the Army. 
The increased funding level for fiscal year 2010 includes $20 million 
for the LCA ecosystem restoration program and reflects an accelerated 
schedule arising from section 7006(e)(3) of WRDA 2007. The fiscal year 
2010 amount also includes $5 million for the science needed to support 
the ongoing effort to restore the complex coastal wetland and barrier 
island ecosystem of coastal Louisiana.
Storm Damage Reduction for the Louisiana Coast
    The Investigations account includes $3 million for completion and 
review of the ongoing Louisiana Coastal Protection and Restoration 
(LACPR) study. The final LACPR Technical Report is scheduled to be 
completed at the Corps District level in late fiscal year 2009. Funding 
included in the fiscal year 2010 budget will be used to refine and 
integrate LACPR findings and outputs regarding alternative trade-offs, 
and coastal landscape contributions to risk management, with ongoing 
Hurricane Storm Damage Reduction projects and Coastal Protection and 
Restoration projects and to delineate comprehensive plans for higher 
levels of storm surge risk reduction.
Everglades
    In partnership with the South Florida Water Management District and 
the National Park Service, the Corps is working to restore much of the 
unique natural ecosystem value to the Everglades. The objective of the 
South Florida Ecosystem Restoration Program is to restore, protect and 
preserve the south Florida ecosystem, including the Everglades, while 
providing for other water related needs of the region. In order to move 
the program forward, the budget for the Corps provides $214 million for 
fiscal year 2010, an increase of $91 million above the amount 
appropriated in fiscal year 2009. Within this amount, the budget would 
initiate or advance construction of the three authorized projects in 
the Comprehensive Everglades Restoration Plan: Picayune Strand, Site 
One Impoundment, and Indian River Lagoon--South.

                      INLAND WATERWAYS LEGISLATION

    The budget proposes enactment of legislation to authorize a lock 
usage fee, which would over time replace the diesel fuel tax now paid 
by most commercial users of the inland and intracoastal waterways. This 
proposed legislation will improve the way that the Nation raises the 
revenue needed to cover the non-Federal share of the capital costs of 
inland and intracoastal waterways projects. The balance in the Inland 
Waterways Trust Fund (IWTF), which affects the Government's ability to 
finance the non-Federal portion of Federal capital investment in these 
waterways, has been declining since fiscal year 2002. The legislation 
will raise more revenue from the users and will do so in a way that 
improves economic efficiency compared to the existing fuel tax, by more 
closely aligning the costs of those who use the Corps locks for 
commerce with the capital costs that the Corps incurs on their behalf. 
The administration stands ready to work with the Congress and 
stakeholders with interest in these capital investments to help pass 
and implement this proposal. The amount provided in the fiscal year 
2010 budget for construction and rehabilitation of projects on the 
inland waterway system, $85 million, has been constrained to ensure 
that necessary funding will be available in the IWTF under current law, 
in the event that the proposed legislation is not in place prior to the 
beginning of fiscal year 2010.

                           OTHER INITIATIVES

Response to Climate Change at Corps Facilities
    The Corps is working, along with other Federal agencies, to address 
the implications of climate change, which has the potential to affect 
the way in which the Corps manages its projects. The fiscal year 2010 
budget includes $5 million in the O&M account to initiate a program to 
develop and begin implementing practical, nationally consistent, and 
cost-effective approaches and policies to reduce potential 
vulnerabilities to water infrastructure resulting from climate change.
Nationwide Evaluation of Hydropower Rehabilitation
    The budget includes $2 million in the O&M account to conduct a 
nationwide assessment of the Corps hydropower program. This initiative 
will help to develop a long-term programmatic investment strategy based 
on a national approach to prioritizing hydropower replacement studies 
and projects.
Low Commercial Use Navigation Pilot Project
    The budget emphasizes the safe and reliable operation of key 
infrastructure assets that are of central importance to the Nation, 
including federally maintained channels and harbors that support high 
volumes of commercial commerce. From a national perspective, projects 
that no longer carry significant commercial traffic nor serve to meet 
subsistence or safety needs have a lower priority. However, many of 
these low commercial use projects remain important locally to the 
people that they serve.
    The fiscal year 2010 budget includes a $1.5 million pilot project 
in the O&M account to develop and encourage alternate non-traditional 
ways to fund maintenance of low commercial use harbors and waterways. 
The pilot project would focus on the Atlantic Coast and Chesapeake Bay 
in the North Atlantic and South Atlantic Divisions of the Corps. It 
will identify the universe of Federal harbors and inland waterway 
segments that support lower levels of commercial use and their 
respective non-Federal sponsors. The project will also formulate a 
range of possible long-term options for the funding and management of 
such facilities, evaluate the pros and cons of these options, and 
examine their applicability to the various types of low use navigation 
projects. This initiative also envisions that more regional general 
permits will be developed through the Corps' Regulatory Program to 
streamline efforts by non-Federal entities to accomplish the 
maintenance of these channels harbors.

         PLANNING IMPROVEMENTS AND PERFORMANCE-BASED BUDGETING

    The Army continues working through the Chief of Engineers to 
strengthen and improve the planning expertise of the Corps, including 
greater support for planning Centers of Expertise, better integration 
of project purposes, and greater reliability of cost estimates and 
schedules in both planning and programming processes. These efforts 
have already begun and will ultimately improve all of our project 
reports.
    The fiscal year 2010 budget continues the Civil Works program's 
commitment to a performance-based approach to budgeting. Competing 
investment opportunities for studies, design, construction, and 
operation and maintenance were evaluated using multiple metrics. The 
Army used and will continue to use objective, performance criteria to 
guide its recommendations on the allocation of funds.
    The Army applied objective performance guidelines to its many 
competing construction projects in order to establish priorities among 
them and to guide the allocation of funds to high-performing ongoing 
projects and high-performing new construction starts. These guidelines 
focus construction funds on those investments within the three main 
mission areas of the Corps that provide the best return from a national 
perspective in achieving economic, environmental, and public safety 
objectives. Similarly, the Army used objective performance criteria to 
allocate O&M funds in the fiscal year 2010 budget. The O&M criteria 
consider both the condition of the project and the potential 
consequences for project performance if the O&M activity were not 
undertaken in fiscal year 2010.
    In fiscal year 2010 the Corps will focus efforts on developing new 
strategies, along with other Federal agencies and non-Federal project 
partners, to better manage, protect, and restore the Nation's water and 
related land resources, including floodplains, flood-prone areas, and 
related ecosystems. The Corps also will continue to pursue management 
reforms that improve project cost and schedule performance to ensure 
the greatest value from invested resources, while strengthening the 
accountability and transparency of the way in which taxpayer dollars 
are being spent.

                 AMERICAN RECOVERY AND REINVESTMENT ACT

    The American Recovery and Reinvestment Act provided $4.6 billion 
for the Civil Works program. That amount included $2 billion for the 
Construction account; $2.075 billion for O&M account; $375 million for 
Flood Control, Mississippi River and Tributaries; $25 million for 
Investigations; $25 million for the Regulatory Program; and $100 
million for the Formerly Used Sites Remedial Action Program. Economists 
estimate the Corps' Recovery Act appropriation will create or maintain 
approximately 57,400 direct construction industry jobs and an 
additional 64,000 indirect and induced jobs in firms supplying or 
supporting the construction and the businesses that sell goods and 
services to these workers and their families.
    The Corps will manage and expend these funds so as to achieve the 
Recovery Act's stated purposes, including both commencing expenditures 
as quickly as possible consistent with prudent management and investing 
in infrastructure and ecosystem restoration that will provide long-term 
benefits. The Civil Works allocations also are fully consistent with 
the President's direction provided in the Executive Memorandum of March 
20, 2009--Ensuring Responsible Spending of Recovery Act Funds. In that 
Memorandum, the President directed agencies to ensure that Recovery Act 
funds are spent responsibly and transparently and that projects are 
selected on merit-based principles.
    Moreover, the Civil Works allocations are consistent with 
additional project selection criteria provided in the Conference 
Committee report accompanying the act that projects, programs or 
activities that are accomplished with Recovery Act dollars will be 
obligated and executed quickly; will result in high, immediate 
employment; have little schedule risk; will be executed by contract or 
direct hire of temporary labor; and will complete a project phase, a 
project, an element, or will provide a useful service that does not 
require additional funding. Also as stipulated in the Recovery Act, no 
funds will be used for any PPA that, at the time of the obligation, has 
not received appropriations provided for Energy and Water Development.
    The Corps selected approximately 170 activities in the Construction 
account, 520 in the Operation and Maintenance account, 45 in the 
Mississippi and Tributaries account, 70 in the Investigations account, 
and 9 in the FUSRAP account. These activities mostly involve the 
funding of work under a single contract, though in some cases projects 
or useful increments of projects will be completed.
    The wide geographic distribution of projects spreads the employment 
and other economic benefits across the United States. Funding also is 
distributed across Civil Works programs to provide the Nation with 
project benefits related to inland and coastal navigation, the 
environment, flood risk management, hydropower, recreation, and more.

                               CONCLUSION

    The administration has made rebuilding America's infrastructure a 
priority. Through resources provided for the Army Civil Works program 
in the President's budget for fiscal year 2010, the Corps can help 
achieve this objective. We seek to apply 21st century technological 
advances to present day challenges, while protecting and restoring 
significant ecological resources.
    Mr. Chairman, I am proud to support the fiscal year 2010 budget for 
the Army Civil Works program. I look forward to working with this 
subcommittee and to your support of the President's Budget proposals. 
Thank you.

                              ENCLOSURE 1

 DEPARTMENT OF THE ARMY--CORPS OF ENGINEERS--CIVIL WORKS BUDGET SUMMARY,
                            FISCAL YEAR 2010
------------------------------------------------------------------------
                                                             Amount
------------------------------------------------------------------------
Requested New Appropriations by Account:
    Investigations...................................      $100,000,000
    Construction.....................................  \1\ 1,718,000,000
    Operation and Maintenance........................  \2\ 2,504,000,000
    Regulatory Program...............................       190,000,000
    Mississippi River and Tributaries................       248,000,000
    Expenses.........................................       184,000,000
    Flood Control and Coastal Emergencies............        41,000,000
    Formerly Utilized Sites Remedial Action Program..       134,000,000
    Office of the Assistant Secretary................         6,000,000
                                                      ------------------
      TOTAL..........................................     5,125,000,000
                                                      ==================
Sources of New Appropriations:
    General Fund.....................................    (4,204,000,000)
    Harbor Maintenance Trust Fund....................      (793,000,000)
    Inland Waterways Trust Fund......................       (85,000,000)
    Special Recreation User Fees.....................       (43,000,000)
                                                      ------------------
      TOTAL..........................................    (5,125,000,000)
                                                      ==================
Additional New Resources:
    Rivers and Harbors Contributed Funds.............   \3\ 369,000,000
    Coastal Wetlands Restoration Trust Fund..........    \4\ 86,000,000
    Permanent Appropriations.........................         9,000,000
                                                      ------------------
      TOTAL ADDITIONAL NEW RESORCES..................       464,000,000
                                                      ==================
      TOTAL PROGRAM FUNDING..........................     5,589,000,000
------------------------------------------------------------------------
\1\ Includes $85,000,000 from the Inland Waterways Trust Fund.
\2\ Includes $793,000,000 from the Harbor Maintenance Trust Fund and
  $43,000,000 in Special Recreation User Fees.
\3\ Cost Sharing contributions required by law for budgeted work
  financed 100 percent by non-Federal interest.
\4\ Transferred from the Sport Fish Restoration Account of the Aquatic
  Resources Trust Fund for planning, protection, and restoration of
  coastal wetlands in the State of Louisiana.


    Senator Dorgan. Mr. Salt, thank you very much. We 
appreciate your being here today.
    General Robert L. Van Antwerp, the Chief of Engineers for 
the U.S. Army Corps of Engineers. Thank you for being here, 
General. You may proceed.
    Let me just make the point that the written testimony that 
you have submitted will be made a part of the permanent record 
and you may summarize.

STATEMENT OF LIEUTENANT GENERAL ROBERT VAN ANTWERP, 
            CHIEF OF ENGINEERS
    General Van Antwerp. Thank you very much, Chairman Dorgan. 
It's great to see you again and thanks for the opportunity to 
testify on the fiscal year 2010 President's budget.
    I'd like to just set a couple of data points before I talk 
about the budget. For the Corps of Engineers, by the end of 
this year we'll have over $40 billion obligated under contract. 
It's the largest in the history of the Corps and we're 
celebrating our 234th birthday on June 16. So it is really a 
historic time in the Corps.
    In order to get this work done, we need to hire 3,300 
people, and we are about halfway there. For the Recovery Act, 
those will be temporary hires and contracts. For the regular 
program, of which of that $40 billion, $10 billion of that will 
be in the Civil Works area that will be under contract by the 
end of this year. So this is a very, very exciting time.
    A couple of other data points, the dams that are owned and 
operated by the Corps number 650. There are 10 of those dams 
that are in this budget for construction, for dam safety. We 
have over 12,000 miles of inland waterways that we're 
responsible for owning and operating. That really constitutes a 
lot of what enables the shipping industries to get goods to 
market.
    We have 241 lock chambers at 195 different sites. Most of 
those were built about 52 years ago. In fact, the average is 
52.5 years old for those lock chambers. So a lot of that O&M 
goes to getting at some of those facilities that greatly need 
that effort.
    We have 926 harbors that are maintained by the Corps of 
Engineers. The amount of dredging material on a given year 
averages over 200 million cubic yards. Of course, the disposal 
of that and the beneficial use of that dredged material is of 
great concern to us, and we want to use that in the most 
beneficial manner.
    We have over 11,000 miles of levees. Actually, that only 
constitutes about 16 percent of the levees in this country. 
Most of the Nation's levees are agricultural levees and others. 
But 16 percent of them are built and controlled by the Corps.
    We have 75 generating plants in hydropower. We generate 
about 24 percent of the U.S. hydropower.
    Then finally, just a data point, we had 370 million 
visitors to our project sites last year. It's really a great 
opportunity for recreation for the people of America.
    This is a performance-based budget. It completes 10 
projects, 4 in navigation, 6 are in flood and coastal storm 
damage reduction. Just broken down by percentage of this 
budget, 11 percent of the budget went for environmental things, 
35 percent for navigation, and 32 percent for flood and coastal 
storm damage reduction.
    In the construction program, it funds 93 construction 
projects, including the 10 dam safety that I mentioned, 9 
projects that address significant risk to human safety, and 8 
are project completions. There are five new starts in this 
budget.
    The O&M, as you've mentioned, is a 14 percent increase and 
this is much needed because of the age of a lot of those 
facilities.
    I want to give just a quick update on New Orleans. We're on 
track to make the 2011 hurricane season with the 100-year storm 
protection.
    Just a quick word on Iraq and Afghanistan, over the course 
of the years we have deployed more than 10,000 people over 
there. A couple of weeks ago we had our first civilian death. 
So there has been mourning, but we are taking care of that 
family and doing what's right there.

                           PREPARED STATEMENT

    Finally on the Recovery and Reinvestment Act, we anticipate 
by the end of this year, September 30, 2009, we'll have 45 
percent of that $4.6 billion obligated. It constitutes more 
than a thousand contract actions altogether.
    Sir, thank you for the opportunity to be here this morning 
and I look forward to the questions.
    [The statement follows:]

      Prepared Statement of Lieutenant General Robert Van Antwerp

    Mr. Chairman and distinguished members of the subcommittee, I am 
honored to be testifying before your subcommittee today, along with the 
Acting Assistant Secretary of the Army (Civil Works), Mr. Terrence 
Salt, on the President's fiscal year 2010 budget for the United States 
Army Corps of Engineers' Civil Works Program.
    My statement covers the following 5 topics:
  --Summary of Fiscal Year 2010 Program Budget
  --Investigations Program
  --Construction Program
  --Operation and Maintenance Program
  --Value of the Civil Works Program to the Nation

               SUMMARY OF FISCAL YEAR 2010 PROGRAM BUDGET

Introduction
    The fiscal year 2010 Civil Works budget is a performance-based 
budget, which makes the best use of available funds through a focus on 
the projects and activities that provide the highest economic and 
environmental returns on the Nation's investment or address significant 
risk to human safety. The Civil Works budget consists of a 
discretionary funding request of $5.125 billion and mandatory funding 
of $464 million, for a total direct program of $5.589 billion. In 
addition, Reimbursable Program funding, work that the Corps does for 
other agencies and entities with those agencies' and entities' funds, 
will be approximately $2.5 billion.
Direct Program
    The budget reflects the administration's commitment to the sound 
management of the Nation's water resources. The budget incorporates 
objective performance-based metrics for the construction and the 
operation and maintenance programs, and for proposed projects 
undergoing preconstruction engineering and design. It provides a high 
level of funding for maintenance, with a focus on those facilities that 
are of central importance to the Nation. It provides funding for the 
regulatory program to protect the Nation's waters and wetlands, and 
supports restoration of aquatic ecosystems. Additionally, it emphasizes 
the need to fund emergency preparedness and training activities for the 
Corps as part of the regular budget process.
Reimbursed Program
    Through the Interagency and Intergovernmental Services Program we 
help non-DOD Federal agencies, State, local, and tribal governments, 
and other countries with technical assistance in the areas of planning, 
engineering and construction. Rather than develop an internal workforce 
to oversee large design and construction projects, these entities 
utilize the skills and talents that we bring to our own Civil Works and 
Military Program missions. Our support is primarily through the 
development of contracts with private sector firms to perform technical 
assistance and management of engineering, environmental, and 
construction projects. This portion of our work is totally reimbursed 
by the agencies and entities that seek our assistance.
    Currently, we provide reimbursable support for about 70 Federal 
agencies and several State and local governments. Total reimbursement 
for such work in fiscal year 2010 is projected to be approximately $2.5 
billion. The exact amount will depend on the extent of fiscal year 2010 
assignments.

                         INVESTIGATIONS PROGRAM

    The budget for the investigations program would enable the Corps to 
evaluate and design the future projects that are most likely to be 
high-performing, within the Corps three main missions: Commercial 
navigation, flood and storm damage reduction, and aquatic ecosystem 
restoration. The budget includes $100 million for these and related 
activities in the Investigations account and $2.084 million in the 
Mississippi River and Tributaries account.
    This year the budget includes three new watershed studies, Ocmulgee 
River Basin Watershead, Georgia; Green River Watershed, Kentucky; and 
St. Louis Missouri River Watershed, Missouri; and a study addressing 
Access to Water Data. The budget also includes $2 million for a high-
priority, interagency evaluation of the Nation's vulnerability to 
damage from flooding, the Water Resources Priority study, as authorized 
in section 2032 of the Water Resources Development Act of 2007 (WRDA 
2007).

                          CONSTRUCTION PROGRAM

    The fiscal year 2010 budget includes $1.718 billion in 
discretionary funding in the Construction account and $87.343 million 
in the Mississippi River and Tributaries account to further this 
objective.
    The budget funds 93 construction projects, including 10 dam safety 
assurance, seepage control, and static instability correction projects, 
9 projects that address a significant risk to human safety, and 8 
project completions. Also, the budget provides significant funding for 
Corps aquatic ecosystem restoration efforts in South Florida including 
the Everglades, and in the Columbia River Basin and the Missouri River 
Basin, where this work supports the continued operation of Corps of 
Engineers multi-purpose projects by meeting the requirements of the 
Endangered Species Act.
    This budget includes funding for five new, high performing, 
construction projects. These include Washington, DC and vicinity flood 
risk reduction project; the Deep Creek Bridge Replacement, Virginia 
project on the Atlantic-Intercostal Waterway; the Norfolk Harbor, 
Craney Island, Virginia project; the Kansas City, Missouri and Kansas 
City, Kansas flood risk reduction project; and the Napa River Salt 
Marsh, California environmental restoration project.
    The budget uses objective performance measures to establish 
priorities among projects, and through continued proposed changes in 
the Corps contracting practices, that will also increase control over 
future costs. The performance measures used include the benefit-to-cost 
ratios for projects whose primary outputs are economic and are measured 
by economic returns. The selection process also gives priority to dam 
safety assurance, seepage control, static instability correction, and 
to projects that address a significant risk to human safety. Under each 
of these criterions, resources are allocated based on performance. This 
approach significantly improves overall program performance.

                   OPERATION AND MAINTENANCE PROGRAM

    As soon as the Corps constructs a project, the infrastructure 
begins to age. Generally, with periodic maintenance, we can operate our 
facilities for many years. The budget supports our continued 
stewardship of this infrastructure by focusing funding on key 
infrastructure that is of central importance to the Nation.
    The Operation and Maintenance (O&M) program for the fiscal year 
2010 budget includes $2.504 billion in the O&M account and an 
additional $158.573 million under the Mississippi River and Tributaries 
program. The Corps used objective performance criteria to allocate 
operation and maintenance funds to facilities. These criteria 
considered both the condition of the project and the potential 
consequences for project performance if the O&M activity is not 
undertaken in the 2010 budget. The focus is on the maintenance of key 
commercial navigation, flood and storm damage reduction, hydropower, 
and other facilities. Specifically, the operation and maintenance 
program supports completed works owned or operated by the Corps of 
Engineers. Other work to be accomplished includes dredging, repair, 
aquatic plant control, removal of sunken vessels, monitoring of 
completed coastal projects, and operation of structures and other 
facilities, as authorized in the various River and Harbor, Flood 
Control, and Water Resources Development Acts.

             VALUE OF THE CIVIL WORKS PROGRAM TO THE NATION

    We are privileged to be a part of an organization that directly 
supports the Nation's infrastructure. The way in which we manage our 
water resources can improve the quality of our citizens' lives and the 
environment in which we live.
    For example, Corps personnel from across the Nation continue to re-
construct and improve the storm damage reduction system for New 
Orleans. Their work will reduce the risk of damage from future storms 
to people and communities.
Research and Development
    The Research and Development Program for the Civil Works Program 
provides innovative engineering products, some of which can have 
applications in the private sector and in the military infrastructure 
sphere as well. By creating products that improve the efficiency and 
competitiveness of the Nation's engineering and construction industry 
and providing more cost-effective ways to operate and maintain 
infrastructure, Civil Works program research and development 
contributes to the national economy.

                               CONCLUSION

    The Corps of Engineers is committed to staying at the leading edge 
of service to the Nation. We're committed to change that ensures an 
open, transparent, and performance-based Civil Works Program.
    Thank you, Mr. Chairman and members of the subcommittee. This 
concludes my statement.

    Senator Dorgan. General, thank you. We appreciate your 
being here and your testimony.

                       DEPARTMENT OF THE INTERIOR

                         Bureau of Reclamation

STATEMENT OF DEANNA ARCHULETA, ACTING ASSISTANT 
            SECRETARY FOR WATER AND SCIENCE
ACCOMPANIED BY REED R. MURRAY, PROGRAM DIRECTOR, CENTRAL UTAH PROJECT 
            COMPLETION ACT OFFICE

    Senator Dorgan. Next we'll hear from Acting Assistant 
Secretary Deanna Archuleta. Thank you very much. You may 
proceed.
    Ms. Archuleta. Thank you. Thank you, Mr. Chairman, 
Senators, subcommittee members. Thank you for the opportunity 
to appear before you in support of the President's fiscal year 
2010 budget request for Bureau of Reclamation and the Central 
Utah Project Completion Act. With me today are Mike Connor, 
Commissioner of Bureau of Reclamation, and additionally we have 
Reed Murray, the Director of the Central Utah Project 
Completion Act office, should you have any questions regarding 
that program.
    I have submitted written testimony which presents a 
detailed summary of the Department's appropriation request. 
Today I would like to highlight the Department's 2010 
priorities and touch briefly on Reclamation and the Central 
Utah Project request, before turning it over to Commissioner 
Connor for a more detailed discussion on Reclamation's request.
    The Department of the Interior's mission is complex and 
multifaceted. Our program's missions stretch from the North 
Pole to the South Pole, across 12 different time zones, from 
the Caribbean to the Pacific Rim. Nearly every American lives 
within 1 hour driving distance from either our lands, our 
waters, all of which are managed by the Department of the 
Interior. As Secretary Salazar has said, the Department of the 
Interior is truly the Department of America.
    Our fiscal year 2010 budget of $12.1 billion will position 
us to provide enduring benefits to the American people by 
maximizing our opportunities to realize the potential of our 
lands, our waters, our resources, and our people. As you know, 
the Department has released a detailed implementation plan for 
$3 billion appropriated in the American Reinvestment and 
Recovery Act, which provided $1 billion for programs funded by 
this subcommittee. The Department, Reclamation, and the Central 
Utah Project Completion Act programs are moving expeditiously 
with our customers to invest those funds, which will quickly 
provide jobs and stimulate the economy.
    The fiscal year 2010 budget request for the Department of 
the Interior focuses on creating new energy frontiers, tackling 
climate change impacts, including the emphasis on water 
conservation, protecting America's treasures, and establishing 
a 21st Century Youth and Conservation Corps. And our fiscal 
year 2010 budget also assumes commitment to restoring the 
integrity of our Government to Government relationships with 
our Indian tribes and empowering our Native American 
communities.
    This is an overwhelming need to tackle climate change 
impacts. The key aspects of climate impacts, particularly in 
the West, are an increased variability of our water supplies. 
Our fiscal year 2010 Reclamation budget is proposing water 
conservation initiatives of $46 million, which will take 
significant steps toward addressing western water issues 
through three ongoing programs: an expansion of our water 
conservation challenge grant program, Reclamation's basin study 
program, and the title 16 water reclamation and reuse program. 
Through these programs, Reclamation will provide competitive 
grants for water marketing and conservation projects, basin 
wide planning studies that will address impacts of climate 
change and continued funding of water reuse and recycling 
projects.
    With regards to the programs under the jurisdiction of this 
subcommittee, the fiscal year 2010 request for Bureau of 
Reclamation and the Central Utah Project Completion Act is $1.1 
billion. I will defer to Commissioner Connor to discuss the 
details of Reclamation's request, but note that their 2010 
proposals support managing, developing, protecting water and 
the related resources in an environmentally and economically 
sound manner.
    Reclamation continues to strive for the highest levels of 
service to the American people and the highest levels of 
management excellence.
    The request for implementation for the Central Utah Project 
Completion Act is $42 million. The fiscal year 2010 funding 
provides funding for design, construction, and features of the 
Utah lake system, continues to implement water management 
improvement projects, as well as implementing fish, wildlife, 
and recreation mitigation, as well as other conservation 
projects.
    Through the Department's fiscal year 2010, we have a 
tremendous opportunity to improve the future of our children 
and our grandchildren with wise investments in clean energy, 
climate impacts, treasured landscapes, our youth, and the 
empowerment of Native Americans.

                          PREPARED STATEMENTS

    I appreciate the strong support this subcommittee has given 
the Department, in particular to the Bureau of Reclamation and 
to the Central Utah Project. I look forward to working with all 
of you in advancing those goals of all of our programs and 
would be happy to answer any questions you may have.
    [The statements follow:]

                 Prepared Statement of Deanna Archuleta

    Mr. Chairman, Mr. Bennett, and members of this subcommittee, I am 
pleased to appear before this subcommittee today to discuss the 
President's fiscal year 2010 budget for the Department of the Interior 
and to update you on progress in implementing our fiscal year 2009 
programs.
    The Department of the Interior's mission is complex and 
multifaceted. Our programs and mission stretch from the North Pole to 
the South Pole and across 12 time zones, from the Caribbean to the 
Pacific Rim. Our extensive mandate rivals any government agency in its 
breadth and diversity--and its importance to the everyday lives of 
Americans.
    Interior manages 500 million acres or about 1 in every 5 acres in 
the United States, including 391 national park units, 550 wildlife 
refuges, the 27 million-acre National Landscape Conservation System, 
and other public lands. These places are treasured landscapes and serve 
as economic engines for tourism and growth opportunities for 
recreation, wildlife conservation, and responsible resource use.
    The Department's public lands and 1.7 billion acres on the Outer 
Continental Shelf supply nearly one-third of the Nation's domestic 
energy production. These resources are vital to the Nation's energy 
security and provide economic returns to the Nation. In fiscal year 
2010, an estimated $14.0 billion in revenues will be generated from 
these lands and waters.
    The Department fulfills its special responsibilities to Native 
Americans managing one of the largest land trusts in the world 
including over 56 million acres held in trust for Indian tribes and 
individual Indians, over $3.4 billion of funds held in over 2,700 
tribal trust accounts, and over 380,000 open individual Indian Money 
accounts. The Bureau of Indian Education school system provides 
services to approximately 42,000 students in 23 States attending 183 
elementary and secondary schools and supports 30 tribally controlled 
community colleges, universities, and post-secondary schools.

                           THE FIRST 100 DAYS

    Recently, President Obama and Secretary Salazar marked their first 
140 days in office. It has been an exciting time as Secretary Salazar 
has begun to change how the Department of the Interior does business. 
He has already implemented changes to improve accountability, 
transparency, and ethical reform; established a vision for a new energy 
frontier that will help to produce and transmit renewable energy from 
our public lands; set an agenda for protecting America's open spaces 
and treasured landscapes with stewardship based on sound science; began 
strengthening the government-to-government relationship with Indian 
tribes; announced a new 21st Century Youth Conservation Corps; and 
implemented the President's economic recovery plan.
    The Department has released detailed implementation plans for $3 
billion appropriated in the American Recovery and Reinvestment Act that 
could significantly improve the safety and energy efficiency of our 
facilities; the reliability of our water infrastructure; and habitat 
for wildlife including endangered species.
    Thanks to your support, the Recovery Act provided $1 billion for 
the programs funded by this subcommittee.
    The Department, Reclamation and the Central Utah Project Completion 
Act program are moving expeditiously with our customers to invest funds 
appropriated by the Recovery Act in projects which will quickly provide 
jobs and stimulate the economy. As Secretary Salazar announced on April 
15, $945.2 million is being devoted to Reclamation recovery projects in 
six program investments areas:
  --Meeting Future Water Supply Needs--$450.9 million
  --Infrastructure Reliability and Safety--$164.5 million
  --Environmental/Ecosystem Restoration--$236.3 million
  --Green Buildings--$13.5 million
  --Water Conservation Initiative (Challenge Grants)--$40.0 million
  --Emergency Drought Relief--$40.0 million
    As permitted by the Recovery Act, $50.0 million is being 
transferred to the Department's Central Utah Project Completion Act for 
work that includes continuing construction of both the Spanish Fork 
Canyon Pipeline and the Spanish Fork--Provo Reservoir Canal Pipeline, 
as well as the construction of the Big Springs Fish Hatchery for the 
Ute Indian Tribe. Finally, as permitted by the statute, $4.8 million is 
being set aside for management and oversight.

                OVERVIEW OF THE FISCAL YEAR 2010 BUDGET

    The fiscal year 2010 Interior budget request for current 
appropriations is $12.1 billion, $802.0 million or 7.1 percent above 
the level enacted by Congress for fiscal year 2009. This comparison 
excludes $3 billion enacted in the Recovery Act. Permanent funding that 
becomes available as a result of existing legislation, without further 
action by the Congress, will provide an additional $6.1 billion, 
providing a total of $18.2 billion for Interior in fiscal year 2010.
    The request for the Bureau of Reclamation and the Central Utah 
Project Completion Act, funded under the jurisdiction of this 
subcommittee, is $1.2 billion for net discretionary funding. This is a 
decrease of $37.4 million below the level enacted for fiscal year 2009. 
This comparison excludes $1 billion in enacted Recovery Act funding. 
The fiscal year 2010 Reclamation discretionary budget request is $985.6 
million in current appropriations and the request for the Central Utah 
Project is $42.0 million, the same as fiscal year 2009 enacted. The 
decreases in Reclamation are primarily in title XVI and rural water, 
areas that received significant increases through the Recovery Act 
($135 million for title XVI and $200 million for rural water projects) 
and through earmarks in fiscal year 2009. These decreases are also 
somewhat offset by fiscal year 2010 increases for the new Water 
Conservation Initiative, the dam safety program, the Central Valley 
Project, and increases in several other programs.

                        TACKLING CLIMATE IMPACTS

    There is an overwhelming need to tackle climate change impacts. 
With lands that range from the Arctic to the Everglades, Interior's 
managers expect to observe the sometimes dramatic effects of a changing 
climate, including thawing permafrost and melting glaciers, changes in 
precipitation patterns, and sea level rise. In this dynamic context, 
Interior managers need information, tools, and resources to measure, 
understand, and respond to on-the-ground impacts. As the largest land 
manager in the Nation, Interior is positioned to pioneer adaptive 
management approaches to address the effects of climate change.

                     WATER CONSERVATION INITIATIVE

    A key aspect of climate impacts, particularly in the West, is 
increased variability of water supplies. The request includes funding 
for a comprehensive water conservation program focused on expanding and 
stretching limited water supplies in the West to reduce conflict, 
facilitate solutions to complex water issues, and meet the growing 
needs of expanding municipalities, the environment, and agriculture.
    The Department of the Interior has an important role to play in 
providing leadership and assistance to States, tribes, and local 
communities to address these competing demands for water. In fiscal 
year 2010, Reclamation is proposing a Water Conservation Initiative 
(WCI), at $46 million, which will take a significant step toward 
addressing western water issues through three ongoing programs. The WCI 
includes: (1) an expanded Water Conservation Challenge Grant Program 
(increased by $26 million over fiscal year 2009); (2) Reclamation's 
Basin Study Program; and (3) the title XVI Water Reclamation and Reuse 
Program. Through these programs, Reclamation will provide competitive 
grants for water marketing and conservation projects, and basin-wide 
planning studies that will provide projections of future water supply 
and demand on a basin-wide scale and address the impacts of climate 
change and drought.
    The Bureau of Reclamation's fiscal year 2010 net discretionary 
budget request of $1.0 billion is offset by $35.1 million in funds from 
the Central Valley Project Restoration Fund. This request supports 
Reclamation's mission of managing, developing, and protecting water and 
related resources in an environmentally and economically sound manner 
in the interest of the American people. The budget emphasizes reliable 
water delivery and power generation by requesting more than $427.2 
million to fund operation, maintenance, and rehabilitation activities 
at Reclamation facilities.
    To address important infrastructure funding needs, the budget 
includes an increase of $13.6 million for the Bureau of Reclamation's 
Safety of Dams program. This will allow the Bureau to address 
corrective actions at Folsom Dam and other high priority projects.
    Reclamation is currently developing programmatic criteria for a 
Rural Water Program as required under the Reclamation Rural Water 
Supply Act of 2006. Reclamation expects to begin appraisal level 
studies in fiscal year 2009. The fiscal year 2010 budget includes $64.0 
million for seven ongoing authorized rural water projects. Within this, 
$48.7 million supports the administration's commitment to complete 
seven ongoing authorized rural water projects including ongoing 
municipal, rural and industrial systems for the Pick Sloan-Missouri 
Basin Program--Garrison Diversion Unit in North Dakota; the Mni Wiconi 
and Perkins County in South Dakota, Lewis and Clark in South Dakota, 
Iowa, and Minnesota; Ft. Peck and North Central Mountain/Rocky Boys in 
Montana; and Jicarilla in New Mexico. Funding for the required 
operations and maintenance component of rural water projects is $15.3 
million for fiscal year 2010. For the construction component, 
Reclamation allocated funding based on objective criteria that gave 
priority to projects nearest to completion and projects that serve 
tribal needs.
    The $54.2 million budget for Animas-La Plata provides for 
directional drilling and pipeline construction on the Navajo Nation 
Municipal Pipeline, the first fill of Lake Nighthorse and construction 
of County Road 211 relocation will continue.
    The Bureau will complete removal of the Savage Rapids Dam in fiscal 
year 2010. The budget includes $23.7 million for the Middle Rio Grande 
project to continue to focus on the protection and recovery of the 
silvery minnow and southwestern willow flycatcher.
    The fiscal year 2010 request includes $2.0 million for the Bureau 
of Reclamation and $2.0 million for the U.S. Fish and Wildlife Service 
to further assess the costs and benefits of removing PacifiCorp's four 
dams on the Lower Klamath River. These studies will be conducted by 
Reclamation and FWS in coordination with BLM, BIA, the U.S. Forest 
Service, and the National Oceanic and Atmospheric Administration's 
National Marine Fisheries Service. The results of the study will be 
used by the Federal Government to determine if the potential benefits 
outweigh the costs of dam removal. Consideration will be given to the 
liabilities, environmental risks, and effects on downstream resources 
resulting from dam removal.
    The budget request for CALFED is $31.0 million, continuing 
implementation of priority activities that will resolve water conflicts 
in the Bay-Delta of California. Funds will be used for water storage, 
the conveyance program, water recycling and conservation, the science 
program, water quality assurance investigations, ecosystem restoration 
projects, and the oversight function to ensure program balance and 
integration.

        PICK SLOAN LEGISLATIVE PROPOSAL (BUREAU OF RECLAMATION)

    The fiscal year 2010 budget request for Reclamation is accompanied 
by a proposal that will affect receipt levels in fiscal year 2010 and 
in future years. This proposal will be transmitted separately from the 
budget for consideration by congressional authorizing committees. The 
proposal is for a reallocation of the repayment of capital costs for 
the Pick-Sloan Missouri Basin program.

                               CONCLUSION

    Thank you for the opportunity to testify on behalf of the 
President's fiscal year 2010 budget request for the Department of the 
Interior. I want to reiterate my appreciation for the long-standing 
support of this subcommittee. Our fiscal year 2010 budget will--in its 
entirety--make a dramatic difference for the American people. We have a 
tremendous opportunity to improve the future for our children and 
grandchildren with wise investments in clean energy, climate impacts, 
treasured landscapes, our youth, and the empowerment of Native 
Americans. This concludes my overview of the fiscal year 2010 budget 
proposal for the Department of the Interior and my written statement. I 
will be happy to answer any questions that you may have.
                                 ______
                                 
                  Prepared Statement of Reed R. Murray

    My name is Reed Murray. I serve as the Program Director of the 
Central Utah Project Completion Act Office under the Assistant 
Secretary--Water and Science in the Department of the Interior. I am 
pleased to provide the following information about the President's 
fiscal year 2010 budget for implementation of the Central Utah Project 
Completion Act.
    The Central Utah Project Completion Act, titles II-VI of Public Law 
102-575, provides for completion of the Central Utah Project (CUP) by 
the Central Utah Water Conservancy District. The act also authorizes 
funding for fish, wildlife, and recreation mitigation and conservation; 
establishes an account in the Treasury for deposit of these funds and 
other contributions; establishes the Utah Reclamation Mitigation and 
Conservation Commission to coordinate mitigation and conservation 
activities; and provides for the Ute Indian Rights Settlement.
    The act provides that the Secretary may not delegate his 
responsibilities under the act to the Bureau of Reclamation. As a 
result, the Department has established an office in Provo, Utah, with a 
Program Director to provide oversight, review and liaison with the 
District, the Mitigation Commission, and the Ute Indian Tribe, and to 
assist in administering the responsibilities of the Secretary under the 
act.
    The 2010 request for the Central Utah Project Completion Account 
provides $42.0 million for use by the District, the Mitigation 
Commission, and the Department to implement titles II-IV of the act. 
The project is currently scheduled to be completed by 2021.
    The fiscal year 2010 request for the District includes $37.7 
million to fund the designs, specifications, land acquisition, and 
construction of the Utah Lake System ($30.8 million); to implement 
water conservation measures ($5.9 million); and to implement 
groundwater conjunctive use projects ($1.0 million).
    The request includes $1.5 million for the Mitigation Commission. 
Approximately $1.2 million will be used to implement the fish, 
wildlife, and recreation mitigation and conservation projects 
authorized in title III. The Commission will use the remaining portion 
($271,200) for completing mitigation measures committed to in pre-1992 
Bureau of Reclamation planning documents.
    Finally, the request includes $2.8 million for the Program Office 
for operation and maintenance costs associated with instream flows; 
$1.1 million for fish hatchery facilities; and $1.7 million for program 
administration.
    In conclusion, we appreciate the opportunity to testify before the 
subcommittee and would be happy to respond to any questions.

    Senator Dorgan. Madam Secretary, thank you very much for 
being here.
    Commissioner Connor, welcome. You may proceed.

STATEMENT OF MICHAEL L. CONNOR, COMMISSIONER
ACCOMPANIED BY BOB WOLF, DIRECTOR OF PROGRAM AND BUDGET

    Mr. Connor. Thank you, Mr. Chairman.
    Mr. Chairman, Senator Bond, Senator Alexander, thank you 
for the opportunity to appear before you today in support of 
the President's fiscal year 2010 budget request for the Bureau 
of Reclamation. With me today is Bob Wolf, who is our Director 
of Program and Budget.
    Mr. Chairman, I'd just like to say it's very much a 
pleasure for me to be here at the witness table today. But as I 
told Roger and Scott earlier, I'm soon to find out that it's 
much more comfortable to do these hearings behind the dais, I 
think, than where I am today.
    The fiscal year 2010 discretionary budget request for 
Reclamation is $986 million. I have submitted written 
testimony. In the interest of time, as well as the fact that as 
a former Senate staff member, I should know the value of 
brevity, I'll quickly summarize three areas of the budget that 
we want to focus on. I also want to talk a little bit about 
Secretary Salazar's Water Conservation Initiative, which the 
Assistant Secretary just mentioned.
    The first area is maintaining our existing infrastructure. 
Reclamation's budget reflects the need to maintain our existing 
portfolio of projects. Reclamation has 476 dams, 348 
reservoirs, 58 power plants, and many other water delivery 
facilities. Much of that infrastructure is at least 50 years or 
older and its proper operation and maintenance is our top 
priority.
    About $427 million of Reclamation's discretionary budget is 
dedicated to making sure that our facilities are operated and 
maintained in a safe and reliable fashion. This is a 21 percent 
increase just over the last 2 years, but providing adequate 
funding for these activities continues to be one of 
Reclamation's highest priorities.
    Part of that program is our dam safety program. In 
Reclamation's infrastructure portfolio there are 371 dams and 
dikes that could result in loss of life if they were to fail. 
These structures form the core of Reclamation's Dam Safety 
Program. A total of $102 million is requested for this program, 
which is about a $14 million increase over the 2009 enacted 
level.
    The second area I want to focus on is new water 
development. Reclamation continues to be actively involved in 
programs to develop new water supplies and infrastructure. 
Examples of these ongoing water development activities in the 
fiscal year 2010 budget request include: the Animas-La Plata 
project, for which there is $54 million allocated to continue 
implementation of the Colorado Ute Settlement Act and Rural 
water programs.
    The budget includes $64 million in fiscal year 2010 funding 
for water systems to deliver surface water to Indian and non-
Indian communities in the Great Plains Region. These projects 
provide good quality water to rural areas where existing water 
supplies are either nonexistent or of very poor quality. The 
request includes funding for seven ongoing authorized rural 
water projects and funding for the O&M requirements that 
Reclamation has for the tribal water features is $15.3 million 
and about $49 million supports the administration's commitment 
to completing construction of the Mni Wiconi Project in South 
Dakota, the Garrison Unit in North Dakota, Lewis and Clark in 
South Dakota, Iowa, and Minnesota, Fort Peck in Montana, and 
for the first time we have included a budget request for 
Perkins County in South Dakota, Jicarilla Apache Project in New 
Mexico, and the North Central Montana Rocky Boys Project in 
Montana.
    Overall, the request for rural water projects will continue 
the substantial investment made in recent years, including the 
$200 million in Recovery Act funding that Reclamation is 
currently in the process of allocating.
    The fiscal year 2010 budget also requests $2.3 million for 
the establishment of the formal rural water supply program 
required under title 1 of the Rural Water Supply Act of 2006 
and we hope to get that program up and going by fall of this 
year.
    The third area is the environmental and ecosystem 
restoration programs that Reclamation has. Reclamation works to 
meet the increasing water demands of the West while protecting 
the environment. Reclamation has an established role in 
restoring aquatic habitat that is impacted by historic 
development and is working on a large number of restoration 
programs that are necessary to maintain compliance with the 
Endangered Species Act.
    Accordingly, the 2010 budget continues focus on these 
challenges, including increases for several programs addressing 
environmental issues. Some examples include a $15 million 
request for the Red Bluff Pumping Plant, which is part of the 
Central Valley Project in California. Additionally, you will 
see an increase in the Lower Colorado River Operations Program 
to fund the multi-species conservation program which is key to 
ESA compliance in the lower Colorado River.
    Finally, as I mentioned, I want to talk a little bit about 
Secretary Salazar's water conservation initiative. It's one of 
the most significant and exciting elements of our fiscal year 
2010 budget. In fiscal year 2010, Reclamation will implement 
the water conservation initiative to expand and stretch limited 
water supplies in the West, to reduce conflict, facilitate 
solutions to complex water issues, and meet the growing needs 
of municipalities, the environment, and agriculture.
    The fiscal year 2010 budget provides $46 million in funding 
for the water conservation initiative. This includes a $26 
million increase in challenge grants for fiscal year 2010 and 
Reclamation will use these--will provide these grants on a cost 
shared basis in the areas--to facilitate water transfers 
between willing sellers and buyers, water efficiency and 
conservation projects, and projects that improve water 
management by increasing operational flexibility in our 
systems, and finally, pilot and demonstration projects that 
demonstrate the viability of treating and using brackish ground 
water, sea water, or impaired waters within a specific locale.
    Within the funding requested in 2010, Reclamation will be 
able to fund at least 110 new water conservation projects. 
These projects will be required to be completed within 2 years 
from the date of funding and therefore will have a near-term 
impact on water savings. The initiative also incorporates the 
basin study program, in which Reclamation will work with State 
and local partners to initiate comprehensive water supply and 
demand studies in the West.
    A final piece for the water conservation initiative is 
funding for the title XVI Water Reclamation and Reuse Program. 
The funding requested in the 2010 budget is in addition to a 
substantial amount of funding provided by Congress in the 
Recovery Act.

                           PREPARED STATEMENT

    Mr. Chairman, please allow me to express my sincere 
appreciation for the continued support that this subcommittee 
has provided Reclamation.
    This completes my statement. I'll be happy to answer 
questions at the appropriate time.
    [The statement follows:]

                Prepared Statement of Michael L. Connor

    Thank you, Mr. Chairman, Mr. Bennett and members of the 
subcommittee, for the opportunity to appear before you in support of 
the President's fiscal year 2010 budget request for the Bureau of 
Reclamation. With me today is Bob Wolf, Director of Program and Budget.
    I appreciate the time and consideration this subcommittee gives to 
reviewing and understanding Reclamation's budget and its support for 
the program. Reclamation works hard to prioritize and define our 
program in a manner that serves the best interest of the public and 
those who rely on Reclamation for their water and power.
    Our fiscal year 2010 request continues support to activities that 
deliver water and generate hydropower, consistent with applicable State 
and Federal law, in an environmentally responsible and cost-effective 
manner.
    The proposed funding will allocate funds to projects and programs 
based on objective and performance-based criteria to most efficiently 
implement Reclamation's programs and its management responsibilities 
for the water and power infrastructure in the West. The President's 
budget request emphasizes the following principle: enhancing management 
of our water infrastructure and programs in the West by eliminating 
program redundancies, leveraging partnerships with our western 
stakeholders and maximizing opportunities for competitive processes.
    The fiscal year 2010 request for Reclamation totals $1.0 billion in 
gross budget authority. This takes into consideration the effects of 
the legislation that, beginning in fiscal year 2010, redirects an 
estimated $5.6 million for Friant surcharges from the Central Valley 
Project Restoration fund to the San Joaquin River Restoration Fund. The 
request also is partially offset by discretionary receipts in the 
Central Valley Project Restoration Fund of $35.1 million. The resulting 
net discretionary request for Reclamation is $985.6 million.

                      WATER AND RELATED RESOURCES

    The fiscal year 2010 request for Water and Related Resources is 
$893.1 million. The request for Water and Related Resources includes a 
total of $465.9 million for water and energy, land, and fish and 
wildlife resource management activities (which provides for 
construction and management of Reclamation lands, and actions to 
address the impacts of Reclamation projects on fish and wildlife). The 
request also includes $427.2 million for facility operations, 
maintenance, and rehabilitation activities which is used to ensure 
sound and safe ongoing operations. Adequate funding for facility 
operations, maintenance, and rehabilitation continues to be one of 
Reclamation's highest priorities. Reclamation continues to work closely 
with water users and other stakeholders to ensure that available funds 
are used effectively. These funds are used to allow the timely and 
effective delivery of project benefits; ensure the reliability and 
operational readiness of Reclamation's dams, reservoirs, power plants, 
and distribution systems; and identify, plan, and implement dam safety 
corrective actions and site security improvements.
Highlights of the Fiscal Year 2010 Request for Water and Related 
        Resources
    I would like to share with the subcommittee several highlights of 
the Reclamation budget, including one of the most significant and 
exciting elements of our 2010 request, the Water Conservation 
Initiative. In fiscal year 2010, Reclamation will implement the Water 
Conservation Initiative focused on expanding and stretching limited 
water supplies in the West to reduce conflict, facilitate solutions to 
complex water issues, and to meet the growing needs of expanding 
municipalities, the environment, and agriculture.
    Water Conservation Initiative (WCI) ($46.0 million).--Of this 
amount, $37.2 million appears as the Water Conservation Initiative line 
item. The remaining $8.8 million is funded in specific title XVI water 
reclamation and reuse projects.
    The American West is now the fastest growing region of the country 
and faces serious water challenges. Competition for finite water 
supplies, including water for environmental needs, is increasing as the 
need for water continues to grow. At the same time, extended droughts 
are impacting water availability and climate change is likely to 
compound the situation. With an increase of $26 million in fiscal year 
2010, Reclamation will help address these concerns by providing cost-
shared grants, on a competitive basis, through the Water Conservation 
Initiative. The Water Conservation Challenge Grants (previously Water 
for America Challenge Grants) provide the following types of on-the-
ground projects: (1) Water marketing projects with willing sellers and 
buyers, including water banks that transfer water to other uses to meet 
critical needs for water supplies; (2) water efficiency and 
conservation projects that allow users to decrease diversions and to 
use or transfer the water saved; (3) projects that improve water 
management by increasing operational flexibility (constructing aquifer 
recharge facilities or making system optimization and management 
improvements); and (4) pilot and demonstration projects that 
demonstrate the technical and economic viability of treating and using 
brackish groundwater, seawater, or impaired waters within a specific 
locale. All grant proposals will be evaluated using criteria that give 
priority to projects that save the most water, facilitate transfers to 
new uses, address endangered species and other environmental issues, 
improve energy efficiency, conserve Reclamation project water, and 
exceed the minimum 50 percent non-Federal cost-share requirement.
    With the funding requested in fiscal year 2010, Reclamation will be 
able to fund at least 110 new water conservation projects. The WCI 
competitive grant projects will be required to be completed within 2 
years from the date of funding. As a result, projects funded under the 
WCI will have a near-term impact on water savings. Reclamation believes 
that water conservation, use of markets, and improved efficiency are 
crucial elements of any plan to address western water issues. With the 
WCI grants, Reclamation will take an important step towards increasing 
conservation and efficiency on a West-wide basis.
    The WCI also incorporates the Basin Study Program in which 
Reclamation will work with State and local partners to initiate 
comprehensive water supply and demand studies in the West. Each study 
includes state of the art projections of future water supply and demand 
on a basin-wide scale; analysis of how the basin's existing water and 
power operations and infrastructure will perform in the face of 
changing water realities; and recommendations on how to optimize 
operations and infrastructure in the basin to supply adequate water in 
the future.
    The title XVI, Water Reclamation and Reuse Program also contributes 
to water conservation in the Western United States, and is included in 
the WCI. The request includes $9.0 million to make available cost-
shared funding for ongoing title XVI construction projects, research 
activities, and feasibility studies ($8.8 million directly supports 
named projects, $200,000 is used by the Commissioner's Office for 
administrative support of the program). Title XVI projects develop and 
supplement urban and irrigation water supplies through water reuse, 
thereby improving efficiency, providing flexibility during water 
shortages, and diversifying the water supply. There is also $3.0 
million for water reclamation funded in the California Bay-Delta 
program under the Water Use Efficiency activity.
    Other significant programs and highlights include:
    Animas-La Plata in Colorado and New Mexico ($54.2 million).--The 
fiscal year 2010 President's budget request will continue 
implementation of the Colorado Ute Settlement Act. This funding will 
provide for directional drilling and pipeline construction of the 
Navajo Nation Municipal Pipeline, the first fill of Lake Nighthorse, 
and construction of County Road 211 Relocation and other required 
relocations. In addition to construction funding, this request includes 
funding for operation and maintenance of improvements for wetland and 
wildlife mitigation lands associated with the project.
    Columbia/Snake River Salmon Recovery in Idaho, Oregon, Montana, and 
Washington ($18.0 million).--This program implements actions under both 
the 2000 Biological Opinion issued by FWS and section 7(a)(2) of the 
Endangered Species Act as required by the 2008 Biological Opinion 
issued in May 2008 by the National Marine Fisheries Services. The 
fiscal year 2010 President's budget request will enable Reclamation to 
address the requirements in the 2008 Biological Opinion for actions to 
enhance tributary spawning and rearing habitat to offset the effects of 
the Federal Columbia River Power System (FCRPS) hydro system operations 
on salmon and steelhead survival. It also will fund Reclamation's 
involvement with non-Federal parties located in Idaho, Oregon, and 
Washington to modify screens and remove instream diversion-related 
barriers. As required by the 2008 FCRPS Biological Opinion, it will 
fund Reclamation's participation in the implementation of real-time 
operational measures, system flood control, and Columbia Basin Project 
actions associated with ESA listed species.
    Klamath Project in Oregon and California ($25.0 million).--The 
fiscal year 2010 President's budget request will continue funding for 
Reclamation to collaborate with other Federal and State agencies, 
tribes and the public to develop a basin-wide recovery plan that 
addresses water supply, water quality, fish habitat, and fish 
populations.
    Klamath Dam Removal Study ($2.0 million).--The fiscal year 2010 
President's budget request includes $2.0 million for the Bureau of 
Reclamation and $2 million for the Fish and Wildlife Service (FWS) to 
further assess the costs and benefits of removing four privately-owned 
hydroelectric dams on the Lower Klamath River below the Federal 
project. The request will fund the study costs associated with 
preparing National Environmental Policy Act documentation. The FWS also 
has $2.0 million in its request to support these studies. These studies 
will be conducted by Reclamation and FWS in coordination with BLM and 
BIA, the U.S. Forest Service, and the National Oceanic and Atmospheric 
Administration's National Marine Fisheries Service. Reclamation also 
allocated $4.0 million in ARRA funding for these studies.
    Lower Colorado River Operations Program in California, Arizona and 
Nevada ($21.4 million).--The fiscal year 2010 President's budget 
request will provide funds for the work necessary to carry out the 
Secretary's responsibilities as water master of the lower Colorado 
River, including the development of the Shortage Guidelines and 
reservoir management strategies during low reservoir conditions. The 
fiscal year 2010 request funds measures under the multi-species 
conservation program to provide long-term Endangered Species Act 
compliance for lower Colorado River operations for both Federal and 
non-Federal purposes.
    Middle Rio Grande in New Mexico ($23.8 million).--The fiscal year 
2010 President's budget request will continue funding for endangered 
species activities and Reclamation's participation in the Middle Rio 
Grande Endangered Species Act Collaborative Program as well as repair 
of priority river maintenance sites.
    Platte River Endangered Species Recovery Program ($12.7 million).--
The President's fiscal year 2010 budget request for the Platte River 
Recovery Implementation Program is $12.7 million. The agreement for the 
program was signed by then Secretary Kempthorne and the Governors of 
Nebraska, Colorado and Wyoming in late 2006. Platte River habitat is 
essential to the recovery of the whooping crane, interior least tern, 
piping plover, and pallid sturgeon (all threatened or endangered 
species).
    Public Law 110-229 authorized the Secretary of the Interior, 
through Reclamation, and in partnership with the States of Wyoming, 
Nebraska, and Colorado, other Federal agencies, and other non-Federal 
entities to participate in the implementation of the Program for 
endangered species in the Central and Lower Plate River Basin and to 
modify Reclamation's Pathfinder Dam. No Federal appropriations are 
required to modify the Pathfinder Dam. Program activities include the 
acquisition of lands and water and contracting for habitat restoration 
projects.
    Research & Development ($12.9 million).--Reclamation's research and 
development program has two focus areas for fiscal year 2010: (1) 
Science and Technology (S&T) ($9.2 million) which includes funding for 
the development of new solutions and technologies which respond to 
Reclamation's operational needs with priorities in fiscal year 2010 for 
issues related to climate change and quagga mussels; and (2) the 
Desalination and Water Purification program ($3.7 million) which 
conducts desalination research, development and demonstrations for the 
purpose of converting unusable waters into useable water supplies. The 
research is conducted through competitive, merit-based cooperative 
agreements on a cost-shared basis.
    Rural Water Projects--Ongoing ($64.0 million).--This request 
includes funding for seven ongoing authorized rural water projects. The 
first priority for funding rural water projects is the required 
operations and maintenance component, which is $15.3 million for 2010. 
The budget also includes $48.7 million to support the administration's 
commitment to complete construction of ongoing rural water projects 
including ongoing municipal, rural and industrial systems for Mni 
Wiconi and Perkins County (SD), the rural water component of the 
Garrison Diversion Unit (ND), Fort Peck (MT), Jicarilla Apache 
Reservation (NM), Rocky Boys (MT), Perkins County and Lewis and Clark 
(SD, IA, MN). For the construction component, Reclamation allocated 
funding based on objective criteria that gave priority to projects 
nearest to completion and projects that serve tribal needs.
    Rural Water Program Development ($2.3 million).--On December 22, 
2006, the Rural Water Supply Act of 2006 was signed. The fiscal year 
2010 President's budget requests $2.3 million for title I of the 
statute that requires the Secretary to establish a formal rural water 
supply program for rural water projects in the 17 Western States. The 
act requires the establishment of programmatic and eligibility criteria 
for the rural water program along with other reporting requirements and 
criteria for appraisal and feasibility studies, and to establish clear 
guidelines for project development to help meet the water supply needs. 
Reclamation anticipates completing the final rule and beginning program 
implementation in late 2009.
    Savage Rapids in Oregon ($1.2 million).--The fiscal year 2010 
President's budget request will provide funds for completing the 
removal of the main portion of the Savage Rapids Dam to allow the 
Grants Pass Irrigation District to comply with a Federal court consent 
decree requiring the District to cease irrigation diversions. The 
project is expected to be completed in 2010. Removal of this irrigation 
diversion dam and the installation of pumping facilities allows the 
local farming community to continue irrigated agriculture and remove a 
migration barrier for the threatened Southern Oregon and Northern 
California coho salmon.
    Site Security ($28.9 million).--The President's 2010 budget request 
for site security helps to ensure the safety and security of the 
public, Reclamation's employees and key facilities. Funding will 
support all aspects of Bureau-wide security efforts including physical 
security upgrades at high risk critical assets, law enforcement, risk 
and threat analysis, personnel security, information security, security 
risk assessments and security-related studies, and guards and patrols.
    Under the provisions of section 513 of the Consolidated Natural 
Resources Act of 2008, Reclamation will collect $18.9 million in 
security-related operation and maintenance costs in 2010. Approximately 
60 percent of this amount is reimbursable through up-front revenues. 
Approximately 40 percent of this amount is appropriated and then 
reimbursed to projects through the normal operations and maintenance 
cost allocation process.
    Safety of Dams ($101.9 million).--The President's budget allows 
Reclamation to ensure that safety and reliability of Reclamation dams 
is one of the Bureau's highest priorities. The Dam Safety Program is 
critical to effectively manage risks to the downstream public, 
property, project, and natural resources. Of the budget request of 
$101.9 million, $50 million is for the Folsom Dam (CA), which has been 
identified as the Bureau's highest safety priority. Dam safety 
modifications, within the limits of enacted funding and latest 
information on risk, are planned to begin in 2010 for Glendo Dam (WY) 
and AR Bowman Dam (OR).

                       POLICY AND ADMINISTRATION

    The $61.2 million request in fiscal year 2010 funds the 
development, evaluation, and implementation of Reclamation-wide policy, 
rules, and regulations, including actions under the Government 
Performance and Results Act. These funds are also used for management 
and performance functions that are not chargeable to specific projects 
and required for ongoing Commissioner's activities.

                CENTRAL VALLEY PROJECT RESTORATION FUND

    This fund was established by the Central Valley Project Improvement 
Act, title XXXIV of Public Law 102-575, October 30, 1992. The request 
of $35.4 million is expected to be offset by discretionary receipts 
totaling $35.1 million, which is the maximum amount that can be 
collected from project beneficiaries under provisions of section 
3407(d) of the act. The discretionary receipts are adjusted on an 
annual basis to maintain payments totaling $30.0 million (October 1992 
price levels) on a 3-year rolling average basis.
    The CVPRF request is a net of $35.4 million. This excludes a 
redirection of an estimated $5.6 million collected from the Central 
Valley Project Friant Division water users to the new San Joaquin River 
Restoration Fund beginning in fiscal year 2010 as authorized in Public 
Law 111-11, Omnibus Public Land Management Act of 2009. Previously, 
these funds went into the CVPRF as outlined in the Reclamation Projects 
Authorization and Adjustments Act of 1992, title XXXIV of Public Law 
102-575, section 3406(c)(1). Under the Settlement Act, approximately 
$15.9 million per year of payments from the Central Valley Project, 
Friant Division water users are deposited in the Fund and available 
without further appropriations to implement the provisions of the 
settlement. These funds will be used for habitat restoration, 
improvement and acquisition, and other fish and wildlife restoration 
activities in the Central Valley Project area of California.

                   SAN JOAQUIN RIVER RESTORATION FUND

    As referenced above, funding in fiscal year 2010 will be used to 
continue planning, engineering, environmental compliance, fisheries 
management, water operations, and public involvement activities related 
to the Restoration and Water Management goals in the Settlement. No 
funds are requested beyond the $15.9 million that is available in 
mandatory spending.

             CALIFORNIA BAY-DELTA RESTORATION FUND (CALFED)

    Title I of Public Law 108-361, titled the Calfed Bay-Delta 
Authorization Act, was signed by the President on October 25, 2004. The 
act authorized $389 million in Federal appropriations over the period 
of fiscal year 2005 through fiscal year 2010. For fiscal year 2010, 
$31.0 million is requested to enable Reclamation to advance its 
commitments under the CALFED Record of Decision to resolve water 
resource conflicts in the CALFED solution area. Funds will be used for 
water storage studies, the conveyance program, water recycling and 
conservation, the science program, water quality assurance 
investigations, ecosystem restoration projects and oversight functions 
to ensure program balance and integration.

                  FISCAL YEAR 2010 PLANNED ACTIVITIES

    Reclamation's fiscal year 2010 priority goals are directly related 
to fulfilling contractual requests to deliver water and power. These 
include addressing a range of other water supply needs in the West, 
playing a significant role in restoring and protecting freshwater 
ecosystems consistent with applicable State and Federal law, and 
enhancing management of our water infrastructure while mitigating for 
any harmful environmental effects. Reclamation will deliver roughly 28 
million acre-feet of water to meet contractual obligations while 
addressing other resource needs (for example, fish and wildlife 
habitat, environmental enhancement, recreation, and Native American 
trust responsibilities).
    Reclamation will maintain dams and associated facilities in good 
condition to ensure the reliable delivery of water. Reclamation will 
maintain a forced outage average of 2.20 that is lower than the 
industry average for similar units to ensure reliable delivery of 
power. Reclamation will reduce salinity by setting a goal of preventing 
an additional 12,700 tons of salt from entering the water ways.
    Moreover, the fiscal year 2010 budget request demonstrates 
Reclamation's commitment in meeting the water and power needs of the 
West in a fiscally responsible manner. This budget continues 
Reclamation's emphasis on managing those valuable public resources. 
Reclamation is committed to working with its customers, States, tribes, 
and other stakeholders to find ways to balance and provide for the mix 
of water resource needs in 2010 and beyond.
    In addition, Reclamation, with funds from the American Recovery and 
Reinvestment Act of 2009, will undertake a variety of projects to meet 
future water supply needs, improve infrastructure reliability and 
safety, and restore ecosystems.

                               CONCLUSION

    Mr. Chairman, please allow me to express my sincere appreciation 
for the continued support that this subcommittee has provided 
Reclamation. This completes my statement. I would be happy to answer 
any questions that you may have at this time.

                             BUDGET PROCESS

    Senator Dorgan. Commissioner Connor, thank you very much.
    Mr. Salt, let me ask you why it took 5 weeks from the time 
that the President's budget was released to us getting details 
of that budget? What was going on in the background there?
    Mr. Salt. Sir, both the Recovery Act and the budget being 
so close together, there were a number of efforts by the 
administration to look at the policies that had existed, try 
and come up with a review of those policies, apply them in some 
appropriate way, first in the bill and then, based upon those 
sets of decisions, then to go and make the appropriate 
adjustments in the budget.
    I think as we were doing all of that some of the projects 
changed, some of the numbers changed. As we then went to adjust 
our documentation, it took us certainly longer than we had 
hoped, and I apologize for the delay.
    Senator Dorgan. I'm trying to understand on both the 
economic recovery plan and also this budget what role OMB 
played in the delays, because it seems to me that we have had 
very little time to review what you have submitted in detail. 
We've been put in that position twice in the last 4 years.
    You know, there are lots of questions about how we can get 
information about the metrics that you used to evaluate what 
funding you recommend. I said at the start, the President has 
recommended a lot of earmark funding here. It was true with the 
previous president. Presidents recommend their earmark funding. 
How are those earmarks decided upon? Who makes the judgments 
about here are the things we're going to earmark in our request 
to the Congress?
    Mr. Salt. Sir, as you pointed out in your opening comment, 
it is the President's budget. So obviously at some level the 
President is the one who submits the budget. I am here on his 
behalf presenting this budget. So I take full responsibility 
for the budget that is in front of you.
    I would say as a new person learning how this works, we 
receive broad guidance from OMB. We then apply that guidance as 
we assemble our budget. As I said in my testimony, our focus is 
on trying to ensure that we are recommending the highest 
priority projects. We are given a budget envelope that we fit 
within and it's trying then to recommend the highest priority 
projects.
    Senator Dorgan. Let me tell you why I'm asking the 
question. My sense is you have some sort of evaluation down 
there using certain metrics and models by which you decide 
here's what we'd like to fund. Then I assume it goes, as it has 
in the previous administration, down to the Office of 
Management and Budget and they say, well, here's our 
priorities, and they send it back to you. My understanding is 
these things bounce back and forth. I'm trying to understand 
how it works.
    But let me ask you a couple of specific questions. For 
example, the contract for the Ozark-Jeta Taylor Powerplant is 
not funded for completion in this budget. It's a project that 
you have had in your budget in prior years. I don't understand, 
for example, why you wouldn't fund this to completion or if 
you've changed your mind about the project.
    Mr. Salt. As part of the criteria, we used benefit to cost 
ratio. The sequence of priorities basically was that dam safety 
projects were put at the top of the list, high priority 
projects justified by their economic benefits were arrayed in 
order of their benefit to cost ratio, and in this case the 
Ozark-Jeta Project fell below the other priority projects that 
we had recommended.
    Senator Dorgan. Again, I don't have any particular 
attachment to this project. It just seems to me like if it fit 
some sort of criteria last year saying, it's a project we're 
building, we're going to keep funding it, and now you say, 
except this year we've decided that we don't want to keep 
funding it. I don't understand what the metrics are by which 
one makes that decision. We probably need to know more about 
that.

                       ENVIRONMENTAL RESTORATION

    A question about the Everglades funding, as I calculate 
what you're doing, the Everglades request is $214 million. 
We've spent I think about $1.3 billion on various components of 
Everglades restoration. I'm supportive of restoration projects 
in the Everglades, but the $214 million, that's in addition to 
the $123 million that was in the omnibus, and more than $100 
million you've proposed in the Recovery Act. So that's about 
$440 million in just a matter of months, intended to be 
utilized no later than September 30, 2010.
    I question whether that is going to be able to be done. In 
addition, the Everglades takes about 13 percent of the Corps 
construction budget, and then the next highest funded project 
is the Herbert Hoover Dike, also in Florida, which takes up 
about 8 percent of the construction funds. That means more than 
one-fifth of all the construction money for the Corps is going 
into these two Florida projects.
    I'm not talking about the merits of the projects, but I am 
saying that there are projects I assume in New York and 
California and Missouri and Utah and elsewhere that would 
probably say, how is it that one-fifth of the funding is going 
to be destined in Corps construction to the State of Florida?
    Mr. Salt. Sir, you've raised up a number of important 
issues. As you know, the Everglades restoration is largely 
funded on a 50-50 basis. Much of the work we're talking about 
here are projects that we've been working on for a long time. I 
think the Corps and our partners have been criticized for the 
lack of achieving any actual restoration benefits. So the 
administration is aware of those criticisms and is trying to 
move out with projects that would allow for actual on-the-
ground restoration.
    The recently authorized--the recent WRDA authorized a 
number of projects and what you're seeing in this budget is the 
startup of construction for these recently authorized projects 
that would allow for the progress that people are expecting.
    Senator Dorgan. And those are new starts?
    Mr. Salt. Sir, they are receiving construction funding for 
those elements for the first time, yes, sir.
    Senator Dorgan. General Van Antwerp, you've stated that 11 
percent of the total budget, fiscal year 2010 budget, is for 
environmental restoration. How much of the construction budget 
is set aside for environmental restoration?
    General Van Antwerp. I'm not certain of that figure. I'm 
going to have to get back with you on that number, of the 
actual construction projects. We don't have it broken down like 
that.
    Senator Dorgan. Would you break that down for us, please?
    General Van Antwerp. Yes, sir.
    Senator Dorgan. I have a question of the Bureau, but I want 
to commend the Corps and just say we've been through some 
significant flood fights this year. When you go into a flood 
fight you want the Corps on your side, and the men and women of 
the Corps who came to community after community to be engaged 
in those fights, we should not let the moment pass without 
saying thank you to the Corps and to the organization that 
helps make this happen.
    General Van Antwerp. Thank you, Senator.

                           PROJECT EVALUATION

    Senator Dorgan. In the Bureau of Reclamation, there are a 
number of projects in the fiscal year 2009 Energy and Water Act 
that were not included in the fiscal year 2010 budget request. 
Again, kind of what I asked the Corps: What's the reason for 
that? Have you changed your mind about projects that you 
previously thought worthy and now perhaps think are less 
worthy?
    Mr. Connor. Mr. Chairman, I think that what we're doing 
there is operating within the parameters of the overall budget 
number that we were given. We look at the budget and we 
allocate a set of priorities maintaining the existing 
infrastructure. Then we look at dam safety and security. Then 
we look at ongoing construction activities. Then finally we 
have to deal with our ESA compliance items.
    I recognize that within that ongoing construction activity 
we do have actions that have been undertaken with write-in 
funding on a lot of these rural water projects. But when we 
look at the kind of requirements with respect to maintaining 
that infrastructure, the safety and compliance activities so 
that we can keep delivering water, then we're left with a 
certain amount of money within that budget allocation that 
we're provided. That's where we have to make some tough 
choices.
    Senator Dorgan. So that's where your advice to the 
committee about how you made those choices would be helpful, 
that you force-rank them. I use the term ``earmark.'' You 
earmark your funding choices and force-rank them. We're 
wondering because of that ranking, are some of the things that 
you have previously funded now judged to be less worthy?
    So we'll submit a list of questions to you, but it would be 
helpful to us if you would submit at least a judgment about 
those that you have previously funded and are not now funding, 
to say, in addition to being short of money, we felt this 
ranked below the following, when it did not perhaps the year 
before or the year before that it did rank below another 
project.
    We're just trying to understand what you're doing and what 
your assessment is of the various projects related one to 
another.
    I have taken more than my share of time. I'm going to be 
submitting a list of questions to the Corps and the Bureau. We 
appreciate your being here.
    I'll call on the ranking member, Senator Bennett.
    Senator Bennett. I'll yield.
    Senator Dorgan. Then Senator Bond.
    Senator Bennett. Senator Tester and I were up with the 
Secretary. So you go ahead.
    Senator Dorgan. Senator Bond.

                STATEMENT OF SENATOR CHRISTOPHER S. BOND

    Senator Bond. Sorry I missed that fun.
    General, you mentioned the tremendous O&M costs for our 
operating locks, locks some 80 years old that were built for 50 
years. Many of us believe that they should be replaced and 
expanded for tremendous economic, energy, and environmental 
benefits. But of course, OMB does not agree.
    The chairman rightly pointed out, and he put his finger on 
the problem with earmarks by the administration. My experience 
in the few years I've been here is that the ultimate decisions 
on administration earmarks are made somewhere in the bowels of 
OMB by people we don't know, we don't see or even hear from 
directly, and our constituents can't communicate with.
    When one of us in Congress changes one of these priorities, 
we stand up for the specific item. We appropriately take 
responsibility and answer questions about them. I am one who 
believes that that is a very fair and not sufficiently 
exercised priority.

                             MISSOURI RIVER

    So going to one of the earmarks, the Corps is currently 
responsible under the Clean Water Act to ensure navigable 
waters, such as the Missouri River, are not polluted. A side 
note: I came from EPW, which is looking for a vast expansion in 
the Corps's responsibility that will require a huge number of 
people to regulate every puddle and pond that is not now 
navigable.
    But the administration budget includes $70 million for the 
Missouri River Fish and Wildlife Recovery Project. This is the 
construction of side channels and shallow water habitats across 
farm land adjacent to the Missouri River, for restoration 
activities, primarily for the habitat of the pallid sturgeon. 
Some are already constructed.
    Now, here's the problem. According to the Corps's 
estimates, construction of these projects will result in 
dumping 540 million tons of farm land soil directly into the 
Missouri River. Thus these projects will contribute more than 
350,000 tons of phosphorus to the Missouri River. These 
projects alone will supply 10 times what the EPA Task Force on 
Hypoxia determined to be the annual load of phosphorus of the 
entire Missouri River Basin.
    Scientists believe that phosphorus is a major contributing 
factor in hypoxia in the gulf. In Missouri, the Clean Water 
Commission has vigorously opposed this effort. Missouri 
citizens and farmers have implemented a $41 million soil and 
water conservation tax upon themselves, and Missouri farmers 
pay an additional $27 million of their money to cost-share to 
keep this soil out of the river because of their concern of 
negative environmental impacts.
    Given that the estimated cleanup cost to remove the 
phosphorus that the Corps is planning to put in the Missouri 
River in Missouri cleaning up the shallow water habitat 
projects will be $18 billion, how wise is dumping that soil in 
the Missouri River?
    General Van Antwerp. You have a lot of great facts, Senator 
Bond. I think as we do our section 108 study of the Missouri, 
we need to look further into those issues that you just raised 
right there. As far as the wisdom of that, I've got to really 
dig into the contents of that study. I understand what you're 
saying.
    Senator Bond. I'd like to be able to have a discussion with 
the genius who made that decision. If somebody believes that 
that is still a wise decision, it would be very nice, Mr. 
Chairman, if we could chat with that individual here in a 
hearing.
    These side channel projects are supposed to develop a 
habitat for the pallid sturgeon. I'd like to know how the 
projects were evaluated and justified. Do we know that we're 
getting the best value of our $70 million? I know the U.S. 
Geological Survey has done additional tests on the pallid 
sturgeon and believes there may be some other, more fruitful 
ways of encouraging the reproduction of pallid sturgeon. We 
are, through a Conservation Commission, engaging in a 
significant breeding program for pallid sturgeon so our 
favorite little fish will remain there.
    I would like to know what you have found out about the best 
way to stimulate the sex life of the pallid sturgeon. That 
would be helpful.

                         FLOOD RELIEF AUTHORITY

    Finally, we're very much concerned that a recent 
announcement by the administration to get FEMA out of the 
ability to help fight floods, remove debris, de-water, and 
assist in emergency efforts. There are many small communities 
in my State and I imagine in all States where our communities 
could be left high and dry or, worse, low and wet in the 
darkest hour.
    Does the Corps have any authorization to step forward in 
the gap left by FEMA's failure to deal with these natural 
disasters?
    General Van Antwerp. We do--we have a number of our own 
authorities under Public Law 84-99, which allows us to come in 
and flood fight and do coastal emergencies and those kinds of 
things separate from the FEMA. When we work for FEMA, we work 
under Emergency Support Function 3, which is for debris removal 
and ice and water and the blue roofs. So those issues are under 
FEMA when we respond to a disaster.
    Senator Bond. But you can handle--not just coastal, but you 
can handle the inland disasters that might strike the Dakotas, 
Utah, and Montana?
    General Van Antwerp. Right, much like the Midwest floods or 
even the ice storms of Kentucky this year. We're able to 
respond if it is a levee that's affected, we can come in under 
our own authority.
    Senator Bond. What tests if it's not a levee? What kind of 
damage do you have to have for you to move in?
    General Van Antwerp. If it's not a flood or a levee 
situation----
    Senator Bond. If it's a flood, you can take it?
    General Van Antwerp. If it's a flood, we're allowed to 
flood fight that with the local community. If a levee is judged 
that it is entitled to 84-99 funds, we can come in and build 
HESCO barriers, help increase the height of that levee, et 
cetera.
    Senator Bond. Thank you very much, General. We appreciate 
the good work you do. You're a vitally important partner and 
we're grateful for it. We just have some serious concerns about 
some of the things you've been directed to do.
    Thank you, sir.
    Senator Dorgan. Senator Bond, thank you.
    I should point out that if those in the audience observe a 
different look here on the dais, it's Seersucker Thursday. Some 
of us can only afford one suit, but our colleagues look pretty 
spiffy today and we're glad to see them here.
    Senator Bennett.
    Senator Bennett. Once I bought it for the first Seersucker 
Thursday, I was determined I was going to keep wearing it year 
after year because I'm not going to pay $150 for a suit and 
only wear it once. So that's where we are.
    Thank you, Mr. Chairman.

                    OBJECTIVE PERFORMANCE GUIDELINES

    Mr. Salt, your testimony says that the Corps is applying 
objective performance guidelines to the competing projects. Can 
you explain what the specific guidelines are?
    Mr. Salt. Sir, there are different guidelines depending on 
the business line that we're talking about. Our highest 
priority is dam safety. The Corps does a risk analysis, taking 
into consideration the condition of the dam and the probability 
that there would be a serious risk to public safety, and based 
on that criteria those projects that are deemed a serious risk 
are moved to the top of our list.
    For projects that are justified by the economic benefits, 
it's the benefit to cost ratio that is used. So we take the 
project portfolio that we have and we apply our benefit to cost 
ratio criteria.
    For our navigation projects, it's a combination of the 
state of the navigation channel, the degree to which it's 
silted in and the additional work, dredging or other repairs, 
which need to be done. The Chief of Engineers, General Van 
Antwerp, mentioned the navigation locks and the need to pay 
attention to the important maintenance of our navigation locks. 
That analysis is done based on a combination of the condition 
of the particular project and the impact of not doing the 
maintenance in that year. Again, a similar risk-based analysis 
is used for those projects.
    Senator Bennett. Do you apply those same standards to 
environmental infrastructure projects, the risk, economics, and 
navigation?
    Mr. Salt. Sir, for the environmental restoration, those 
efforts are prioritized basically by the administration as our 
highest priority environmental restoration efforts, and there 
are a number of large environmental restoration efforts. In 
2007, Congress directed the Corps to review its principles and 
guidelines, which really doesn't give the administration's 
national policy for evaluating projects. It doesn't really give 
any guidance as to how to deal with the environmental issue 
that you're talking about.
    We expect within a few months to have the draft proposed--a 
revised draft of the principles and guidelines that we're 
required to give to the National Academy of Sciences. It's in 
that document that we're looking at how to quantify non-
monetary benefits in a way that would allow for a more 
objective set of criteria for dealing with environmental 
restoration projects.
    Senator Bennett. Do you ever have a conflict where you say 
if we do this environmental infrastructure it's in fact going 
to increase the risk?
    Mr. Salt. I'm not aware of any--when I talk about the 
environmental, I'm talking about the environmental restoration 
projects. The environmental infrastructure is basically the 
sewage treatment and those sorts of projects, and I would say 
those are not supported by the administration.
    But for the environmental restoration projects, I'm not 
aware of any--those that I'm aware of in Florida--I've been 
working in Florida--we maintained existing authorizations and 
in fact the projects were formulated so that there was no harm 
done to flood or water supply interests. So I would say as a 
matter of policy that would be my expectation as it relates to 
environmental restoration projects.
    Senator Bennett. Okay.

                           DROUGHT ASSISTANCE

    Ms. Archuleta, the Bureau has budgeted $500,000 for drought 
assistance in fiscal 2010. Do you think that's sufficient?
    Ms. Archuleta. Well, Senator, certainly it's difficult to 
know what our drought conditions are going to be. We work 
collaboratively with NOAA. It's tough for us to predict what 
the weather conditions are going to look like in the coming 
year. We're hopeful and certainly we'll work as closely with 
that budget as we can.
    Senator Bennett. The Central Utah Project. I'm sure it 
comes as no surprise that I have an interest in that. The 
budget is flat compared to fiscal 2009. Obviously you think 
that's sufficient to meet the progress. But what is your 
funding, total funding capability for CUPCA in 2010?
    Ms. Archuleta. Well, actually, if I may, I'd like to turn 
it over to Mr. Murray, who's here, who knows the project, as 
you know, very well.
    Senator Bennett. Okay, good.
    Mr. Murray. Mr. Chairman, Senator Bennett----
    Senator Bennett. Would you identify yourself?
    Mr. Murray. Yes, Reed Murray. I'm the Program Director of 
the Central Utah Project.
    First of all, I'd like to thank the subcommittee for your 
support over the years of the Central Utah Project. As you 
know, it's the largest water project ever undertaken by the 
State. We do appreciate your support.
    Your question was the capability of the project.
    Senator Bennett. Right.
    Mr. Murray. Well, first of all, we do support the 
President's budget. As you mentioned, there is no increase over 
the 2009 appropriation. However, the boost in appropriations 
that we received through your support with the Recovery Act has 
helped us and given a significant increase to our program and 
allowed us to keep on schedule. So as far as our capability, we 
feel that the budget is the capability that we can maintain in 
2010, given that and the Recovery Act funds that we have.
    Senator Bennett. Good. Thank you.

                          TERMINATING PROJECTS

    I'm concerned about failure to complete existing projects. 
I think the chairman visited this issue as well. As I see it, 
this budget cancels 100 ongoing construction projects funded in 
fiscal 2009, not addressed in 2010. Terminating ongoing 
projects obviously long-term creates an enormous cost for the 
taxpayer.
    So Mr. Salt, can you quantify what you expect the Corps to 
be able to pay in contract termination fees if we adopt this 
request? Or will they simply be delayed and resumed at a 
certain point hereafter, which could potentially be 
significantly more expensive as construction costs go up?
    Mr. Salt. Sir, I don't know the number of projects that we 
have stopped. There's one project that, the Ozark Jeta Project 
I believe the chairman mentioned earlier, is a----
    Senator Bennett. I've noted that as well.
    Mr. Salt [continuing]. Has a continuing contract. The 
estimated termination costs if we're required to terminate are 
estimated at $12 million. That project--at the time we put the 
stimulus list together, our assumption was that that project 
would be in the budget. So it wasn't included in our list. It 
would have----

                         ECONOMIC RECOVERY ACT

    Senator Bennett. So you're saying it was not included in 
the Recovery----
    Mr. Salt. It was not in our initial stimulus list. When the 
final guidance--when we finally determined what was our 
criteria, on the benefit to cost----
    Senator Bennett. Right.
    Mr. Salt [continuing]. The benefit to cost ratio from that 
project fell under the--we were not able to get to it with the 
available funds that we had. Because it has a higher benefit to 
cost ratio than other projects that we included on our stimulus 
list, we are now looking at the possibility, if funds are 
available based on our execution of the Recovery Act funds, 
this would be a priority for us to include under Recovery Act 
funding, and that's something we will seriously look at.
    Senator Dorgan. Mr. Secretary, that gets to the point I was 
trying to ask you about earlier. I believe you were working on 
the fiscal year 2010 request at the same time that we provided 
funding for the Economic Recovery Act for you. As I said, there 
was zero money requested, inexplicably, for water projects in 
the economic recovery package.
    We provided money, then you began working on how that money 
would be spent, and that was concurrent with your work on the 
fiscal year 2010 budget request. So when you say that you 
expected it to be in the budget request, so you didn't put it 
in the economic recovery package, you were doing both of them. 
That's what I was trying to get at. Or did that list go 
somewhere else for somebody else to make decisions? And if so, 
whom?
    Senator Bennett. I'm assuming from your question and the 
chairman's explanation, from your answer to me and the 
chairman's probing, I'm assuming that we can expect some 
reprogramming requests from you to try to put some of this back 
in.
    Mr. Salt. Sir, that decision has been made. It is a 
priority, and I think as we move forward--I guess, Mr. 
Chairman, your comment gets to what I was trying to answer when 
I apologized for the delay. I think there were two areas where 
this came up. One was on the beach projects, where we were 
trying as a matter of policy to decide whether to fund some of 
them in the Recovery Act or not. We ended up doing not only 
initial nourishment, but also re-nourishment, and doing that as 
part of the budget, and not to include funding for those in the 
stimulus.
    Similarly, we were putting the stimulus together, we did 
make what turned out to be a wrong assumption that we would 
proceed with the continuing contracts in the budget. It turned 
out that the performance-based guidance we received was that we 
would fund down to a benefit to cost ratio for which the Ozark 
Jeta Project didn't compete on a benefit to cost basis, and it 
was not included in the President's budget.
    So it was our decision. Basically, we said here is the 
broad guidance we were given. As we applied that broad 
guidance, the Ozark Jeta Project fell below the threshold.
    Senator Bennett. You do incur an obligation to repay people 
who have been involved. Do you have plans to reimburse the 
Southwest Power Authority or their ratepayers for the $20 
million that they've contributed?
    Mr. Salt. Sir, that's why it's a priority that we consider 
it for the available funds in the Recovery Act.
    Senator Bennett. So it would be cheaper, wouldn't it, 
rather than reimburse that $20 million, to simply go ahead and 
finish it?
    Mr. Salt. Yes, sir, I think it would.
    Senator Bennett. Okay, then let's go ahead and finish it.
    I understand, having experience with OMB that OMB sometimes 
has a different view of life than agencies, and I won't press 
you any further on that. But I do feel that failing to complete 
existing projects ultimately ends up as a waste of taxpayers' 
money.
    Thank you, Mr. Chairman.
    Senator Dorgan. I think that there can be cases where an 
existing project at some point becomes a project that someone 
says, well, we'll reevaluate; it sounded good when we started 
it, but this is no longer a project that makes much sense.
    But the Senator from Utah makes an important point. If this 
project should be continued--I'd much sooner appropriate 
funding to finish a project that is worthy rather than pay 
penalties to end the project. I mean, $12 million or $20 
million is a lot of money.
    Did anyone raise this during the deliberations of the 
budget and the Recovery Act, or was it just not raised?
    Mr. Salt. Sir, we raised it and my counterparts in OMB even 
said I could blame them if I wanted. But I don't----
    Senator Dorgan. Maybe you just did.
    Mr. Salt. No, sir. No, sir. What I'm trying to say is I'm 
here and I take ownership of this budget. I'm trying to explain 
the rationale for it.

                           BUDGET PRIORITIES

    Senator Dorgan. I understand the difficulty. We're not 
trying to ruin your breakfast here. As I said at the start, you 
come representing a budget. You're required to pay fealty to 
that budget. I understand that. And we're just trying to 
understand what the criteria is by which decisions are made and 
who makes them.
    It was very frustrating for us as we watched particularly 
the economic recovery funds and the list, because you didn't 
have a list. You didn't ask for any funding. We provided 
funding. And then there was a list. I had to call the head of 
OMB and I called the White House to find out when would 
somebody start making decisions about funding some of these 
projects, because the purpose of them was to start some sort of 
economic recovery. It took some while to get something off 
center to get it moving.
    So again, I don't--I understand the point you're making, 
Mr. Salt. Yes?
    Mr. Salt. Sir, could I make one comment, that as a new 
person I too am sharing some of your frustration as to how 
we're doing this. We have talked to OMB. We have talked to 
folks that as part of our fiscal year 2011 budget to try and 
work with the Congress to come up with a better way.
    The big issues are what you alluded to, sir, how do you 
ensure that we're funding the highest priority needs, because 
we have a backlog that we can't get to of very high priority 
projects because we're funding the portfolio that we have. So 
we're very interested in trying to come up with a better way of 
working through this in a way that's more mutually 
satisfactory.
    Senator Dorgan. And we want to work with you. We want you 
to succeed. We want the best decisions possible to come out of 
all of this. This is not a subcommittee where there are 
political battles going on. We're all very interested in water 
and energy issues and we want the best decisions to be made. We 
want to work with you, and we appreciate your being here.
    A new member of this subcommittee, and we're pleased to 
have him, Senator Tester.
    Senator Tester. Thank you, Mr. Chairman.

                      MISSOURI RIVER RECOVERY PLAN

    We'll start with the General. But, Mr. Salt, if you want to 
throw in on this one you can. The Army Corps requested $70 
million for the Missouri River recovery plan. Senator Bond 
spoke of it a bit ago. Part of this money is to be used for 
completing an environmental analysis and engineering on an 
intake dam near Glendive, Montana. The replacement of that dam 
will open up about 240 miles to pallid sturgeon on the 
Yellowstone River.
    I guess the question is, does the $70 million request for 
that line item allow for the intake dam project to proceed in a 
timely manner?
    Mr. Salt. Senator, it does allow for it to proceed in a 
timely manner. There were also funds in the Recovery Act for 
that, so the combination of these allows us to proceed in a 
timely manner.
    Senator Tester. Thank you. What's the timeframe on that, on 
the removal and replacement of that dam?
    Mr. Salt. That I'm going to have to get the detailed 
schedule. I don't have it with me right now.
    Senator Tester. If you could do that and get it back to my 
office, I would certainly appreciate that. Thank you very much.

                          FORT PECK RESERVOIR

    Talk a little bit about--we'll talk a little bit about 
some--and this is also for you, General--about some lots on 
Fort Peck Reservoir. The WRD Act of 2000 authorized conveyance 
of about 400 cabin sites in four areas around Fort Peck to 
current leaseholders. I guess the question is that in the last 
2 years the Corps has received about $1.8 million to complete 
the surveys and environmental work to complete the sale. The 
authorization expires next year. Does the Corps have adequate 
resources to complete the lot sales before the authorization 
expires?
    General Van Antwerp. In this case we don't have the entire 
funds to complete this. There is an additional amount of funds 
that is needed to finish this project.
    Senator Tester. Okay. So the Omaha District reported to our 
office that about $1.9 million could be used in fiscal year 
2010 to complete the sales. I'm confused why they told my 
office that, but yet did not put in a request to that effect.
    General Van Antwerp. At this point I need to read about 
capability and what the district did was give you the 
capability. That of course is the amount of funding that could 
be used above the amount requested. In this case, there's no 
money requested in the President's budget for this project.
    Also, I have to remind that we would utilize additional 
funds on projects or studies, but there would have to be 
offsets. So it's all part of, as the budget was assembled this 
project didn't get the funds, but there is a capability to do 
work on this project if funds were appropriated.
    Senator Tester. Okay. The authorization expires next year. 
It's been going on since 2000, a 10-year project. I think that 
there is a will on both sides to do this. What I heard you just 
say is that you weren't going to do it because you didn't have 
capability of doing it?
    General Van Antwerp. No, we have capability of doing the 
work. As we looked at the budget in its entirety and it was put 
together, there weren't sufficient funds to allocate money 
toward this project.
    Senator Tester. Okay, so it didn't come up high enough on 
the priority list to ask for money for this project, is what 
you're saying?
    General Van Antwerp. That's correct.
    Senator Tester. Okay. So are you going to ask for an 
extension of that authorization? Are you just going to let it 
run out?
    You can get back to me on that, if you would. It would be 
good to get it done. Let's just put it that way.

            MISSOURI RIVER RECOVERY IMPLEMENTATION COMMITTEE

    I hate to pick on you, General. I've got another one. The 
Missouri River Recovery Implementation Committee was created as 
an all-inclusive--well, an inclusive; shouldn't say ``all''--
planning body for the stakeholders throughout the basin of the 
Missouri River. The legislation creating this project, the 
MRRIC Project, prohibited the stakeholders from getting help 
for traveling to these meetings. I've got a couple questions.
    How is stakeholder involvement? If you can't address it, 
you can get back to me on that, too. But how is stakeholder 
involvement as far as this subcommittee goes? That would be the 
first question.
    General Van Antwerp. First of all, it's crucial that we 
have stakeholder involvement.
    Senator Tester. Are they involved?
    General Van Antwerp. They are involved. That's absolutely 
crucial and it is part of the process. As we do all the 
activities--this is in kind of the preplanning stage, which is 
really when those stakeholders need to be involved.
    Senator Tester. I agree with you that it is absolutely 
critical that you get broad-based participation in the 
subcommittee. I can tell you the stakeholder travel is not 
permitted under the project and I have got--I have received a 
fair number of calls saying, particularly from Native American 
tribes who are part of that basin, saying that it's really not 
inhibiting their--its inhibiting their ability to come.
    I just want to get your thoughts on that. I mean, if we're 
getting broad-based attendance now, that truly is broad-based, 
that's a good thing. Going into the future, if it starts to cut 
back I think it would be great to know about that, so we can 
address it.
    General Van Antwerp. I think your concerns, Senator, are 
good. What we try and do in this case--we do not pay those 
funds for them to travel to be part of that stakeholder group. 
But we do try and locate our meetings where----
    Senator Tester. Centralized.
    General Van Antwerp [continuing]. They don't have to 
travel. So we will take--I'll take a close look at this and 
make sure we're not disadvantaging or not getting their input 
because we're not in their location.
    Senator Tester. I appreciate that.

                       SAINT MARY'S CANAL PROJECT

    Mike Connor, it's good to see you, good to see you on that 
side of the table, hope the position's working out well. I 
think you're doing good work.
    The President's budget included funding to conduct NEPA on 
the diversion dam at Saint Mary's Canal. We appreciate the 
recognition from the administration more than you will know 
that this facility is in bad need of repair--a critical first 
step.
    However, while replacing the diversion dam is needed, 
especially as it applies to endangered species protection, it 
does not address the risk of catastrophic failure of the 
overall parts of the system, which are--not if, but when 
they're going to fail. We cannot fix it, the project, as you 
probably know, Mike, until the alternatives are completed 
around it.
    Does the administration support NEPA on the entirety of the 
Saint Mary's Canal Project, and if they haven't been--if you 
don't know that question, I guess my question is would you 
advocate for that?
    Mr. Connor. Well, thank you for your welcome, Senator 
Tester.
    I don't know the complete answer to your question, but I do 
know we do have in the fiscal year 2010 budget a request to 
initiate the NEPA and the ESA consultation that we do need to 
complete.
    Senator Tester. And we thank you for that.
    Mr. Connor. So we will move forward very quickly in that 
manner. We are also having ongoing discussions with the Corps 
and our regional folks and a very good dialogue going right 
now, given the authority that the Corps also has, as to how to 
best move forward and maybe we can do it in a cooperative 
effort in doing our analysis and trying to develop a game plan 
under which we can maybe segment or look at different ways to 
get into the rehabilitation as we move forward with the NEPA 
and the ESA process.
    Senator Tester. Commissioner, the door is always open. We 
would love to be a part of those conversations. This is a 
critically important project for the northern tier of Montana, 
not only towns, but irrigators, and it's one of those things 
that should have been replaced 30, 40 years ago. But we are 
where we are.

                       RURAL WATER INFRASTRUCTURE

    Another question that deals with the rural water projects 
that received a good sum of money for the recovery package, and 
we appreciate your work there, too. Projects in my neck of the 
woods, Montana, North Dakota, South Dakota, these are long-term 
commitment projects, as you well know. Should we interpret the 
support in the Recovery Act as a renewed commitment from this 
administration to support rural water infrastructure? Is it 
high on their list?
    Mr. Connor. Well, the funding provided for those two rural 
water projects in Montana, I think represents the fact that 
there's a recognition of the need that exists there, and 
certainly trying to implement the Recovery Act in a way that 
met the goals of job creation and meeting other priorities as 
set forth in the legislation. So those two projects did receive 
substantial money.
    There is also a request, I think even maybe for the first 
time, on a couple of those projects for the fiscal year 2010 
budget. Recognizing that those requests are significantly lower 
than the funding provided by Congress, I think it's a 
recognition that we do want to continue toward moving forward 
with progress. Particularly in Fort Peck, I think we're getting 
substantially down the way to completion of the project.
    Senator Tester. Yes.
    Mr. Connor. Rocky Boys is still really in its infancy, but 
there is some level of funding in the 2010 budget to keep the 
activity going there.
    Senator Tester. Well, I certainly appreciate it. Just as a 
sidebar comment, from my days in the State legislature, from my 
first day in the State legislature as a matter of fact, these 
projects were on the list and they've more than doubled in the 
last 10 years because of inflation. I appreciate the 
administration's stepping up and putting some significant 
moneys in because it finally gets us ahead of inflation, and I 
think that we've got to get these projects done or literally a 
good portion of eastern Montana will have a hard time 
surviving. Let's just put it that way.
    Anyway, I thank you all for being at the hearing and I 
appreciate your comments.
    Thank you very much.
    Senator Dorgan. Senator Tester, thank you very much.
    Senator Alexander.
    Senator Alexander. Thank you. Thank you, Mr. Chairman.

                            CHICKAMAUGA LOCK

    I have just two. Thanks to each of you for being here. I 
have just two questions, General, and both of them are of you, 
if I may. I'm concerned the Corps is not properly prioritizing 
Chickamauga Lock near Chattanooga as it considers when to 
complete the construction of the new lock. You've done a lot of 
very important work on it and we appreciate that. But usually 
the Corps determines how important it is to repair or rebuild a 
lock based upon the value of the cargo passing through the 
lock. My concern is that in cases like the one we have at 
Chickamauga the Corps of Engineers isn't able to fully measure 
the value of the lock because the lock plays an important 
supporting role to the Oak Ridge National Laboratory and the Y-
12 National Security Complex, and the cargo that goes through 
the lock to the Oak Ridge Laboratory, which is the largest 
energy laboratory in the world, and the Y-12 National Security 
Complex, which has to do with nuclear weapons, is different and 
difficult to--is different in terms of evaluating it.
    Is there some way that you can consider the role 
Chickamauga Lock plays in supporting Oak Ridge and Y-12 as you 
assess the value of the lock and prioritize it with respect to 
your other lock repair and construction projects?
    General Van Antwerp. Senator, you make some great points. 
We'll take that under consideration. Right now the 
prioritization goes if it's life safety, then economic is 
slightly below that, but very, very important. So we need to 
look at these other considerations, and I will go and make sure 
that this is plugged in as we look at the value of these; when 
we rate our locks and dams, basically the dams, we have 
categorized all them as to the risk of danger for life safety 
and other factors.
    Senator Alexander. Nationally----
    Mr. Salt. Senator, could I comment on that, sir?
    Senator Alexander. Yes, of course.
    Mr. Salt. As we talked earlier, the current guidance for 
the Corps, national guidance, called the principles and 
guidelines, directs the Corps to focus on the aspects of a 
project that optimize the economic development, the NED plan.
    Senator Alexander. Right.
    Mr. Salt. The new P and G will attempt to look at other 
non-monetary factors as a way to try and expand the way we look 
at projects to include these other kinds of considerations. As 
I mentioned earlier, we expect to have our new draft of this 
out later this summer. But I would hope that it would give us 
the analytical basis and the national policy basis to try and 
get at the kinds of issues that you're raising.
    Senator Alexander. Well, the National Academy of Sciences 
in its report--well, in a variety of ways, but in its work with 
the Augustine Commission, which we called America Competes, one 
of the most important pieces of legislation we passed in 
Congress, said that America's brain power advantage since World 
War II is the single greatest contributing factor to our high 
standard of living. That's economic development.
    And the Oak Ridge National Laboratory is the single largest 
energy research laboratory in America, perhaps the world. So 
our great laboratories are our principal engines of economic 
development, not just in Tennessee, but in our country. And 
that's been recognized by the National Academies of Science and 
Engineering and Medicine. It's been affirmed by the Congress in 
our America Competes Act, where we prioritized those efforts.
    So national security is of course another part of it, but 
if we're going strictly on economic development--I remember 
when I was Governor of Tennessee I tried many different ways to 
help our State improve our low family incomes. I tried getting 
rid of the usury limit and I tried building highways. I tried 
everything, but it all came back to education. I eventually got 
into funding centers of excellence and master's teachers and 
chairs of teachers and creating distinguished scientist 
programs between the Oak Ridge National Laboratory and the 
University of Tennessee as the single best way to create higher 
family incomes, economic development. In fact, we became the 
State with the fastest growing family incomes in the country.
    So I'd make a strong argument that the Oak Ridge Laboratory 
and similar institutions around the country fit the economic 
development title or even should lead it. Economic development 
today is different than it was 50 years ago, most people who 
work in it understand that better schools, colleges, 
universities, national laboratories are essential to it.
    Anything else on Chickamauga I should know or ask about?
    General Van Antwerp. I will just tell you it's very high on 
our priority and we're watching it closely and having periodic 
reviews of it. It's moving along.
    Senator Alexander. Well, we've talked about it before and 
it has great importance to our entire region in terms of jobs.

                    CENTER HILL AND WOLF CREEK DAMS

    The other question I have has to do with Center Hill and 
Wolf Creek Dams. I greatly appreciate the priority that you've 
placed on those two dams. The President's budget request shows 
support for funding levels that will continue to keep the 
projects on track with minimal disruption to residents. There's 
a safety problem in Kentucky and in Tennessee outside 
Nashville.
    Now, here is my goal and my question. I'd like to get the 
lake levels back up to pre-construction levels as rapidly as we 
possibly can, because while the lake levels are low we're 
having to buy $100 million worth of electricity every year from 
outside sources that would otherwise be produced by 
hydroelectric.
    Now, this administration is placing a very high value on 
carbon-free electricity from renewable energy and the simplest, 
cleanest form of renewable energy is hydroelectric power. So my 
question is, is there a way that you can continue to do your 
work there, finish the work that you're doing about seepage, 
and bring the lake levels back up to their pre-construction 
levels so we can use that carbon-free electricity that we can 
produce?
    General Van Antwerp. Your point is very well made. I assure 
you we're going to bring those lake levels up as soon as we can 
and still have the proper safety measures. So now that we've 
got the grouting walls in Wolf Creek, for example, that allows 
some raising of that elevation. But it may be farther down the 
road before we can get back to pre-construction levels.
    Safety is the primary concern here. But I assure you we're 
trying, and we're reviewing this. What is the next level? We've 
got all of our experts on it to see, now that you have the 
grouting walls done, what does that allow you to do. We'll do 
some raising of it. As we've had inflows in and raised it up, 
we're watching the boils down below the dam that have lessened, 
by the way, because of the grout curtain.
    But we'll get it up there as soon as we can.
    Senator Alexander. I appreciate that and I have no 
complaint to make about anything about your work there. I just 
thought maybe I'd give you some extra ammunition, given the 
administration's focus on carbon-free electricity. This is a 
significant amount in an area--otherwise we use more coal or 
other things.
    Mr. Chairman, those are the only questions I have. I thank 
you for the time.
    Senator Dorgan. Senator Alexander, thank you very much.

                       RED RIVER VALLEY FLOODING

    Two other points, Commissioner Connor and Secretary 
Archuleta, I'm going to send you a note. I would ask that you 
respond if you would about additional information that you may 
be sending to OMB about the record of decision that's awaiting 
us on the Red River Valley Water Project. The previous 
secretary did not issue a record of decision. I understand 
there is discussion between your agency and OMB and my 
expectation is that you'll be sending them additional 
information. If you would give me a report on that, that record 
of decision has been waiting for some while.
    General Van Antwerp, I did not mention the Red River Valley 
flooding situation and the work that we have done. You've been 
in a number of meetings on the Devil's Lake flooding, chronic 
flooding problem. I'll be holding meetings on Saturday morning 
in Valley City, North Dakota, and Jamestown, North Dakota, 
about the James River and the Cheyenne River, both of which had 
very serious flooding this year. So we're working on a lot of 
issues with you in our State.
    I think all of us on this subcommittee find ourselves in 
that position. That's one of the reasons we aspire to be on 
this subcommittee, to address some very significant water 
policy issues.
    So we will continue to have those discussions. I didn't 
mention them earlier, but I wanted to make note for the record, 
just because we have had a lot of discussions recently about 
them, that they remain a significant priority.

                     ADDITIONAL COMMITTEE QUESTIONS

    I want to thank you for appearing. We will be submitting a 
list of questions to you and ask that you respond to them, and 
we appreciate very much your being here today.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

                Questions Submitted to Terrence C. Salt
             Questions Submitted by Senator Byron L. Dorgan

    Question. Who is the responsible official for approving what goes 
into the Corps' budget?
    Answer. While the Army made recommendations, this is ultimately the 
President's fiscal year 2010 budget.
    Question. Were you also the responsible person that made the 
decisions as to what projects were included in the Recovery Act?
    Answer. Yes, I was ultimately responsible for those decisions. 
Within the Corps headquarters, a senior management group is responsible 
overseeing the American Recovery and Reinvestment Act of 2009 (ARRA) 
activities.
    Question. Could you tell us a little about the decisionmaking 
process that went into the Recovery Act?
    Answer. USACE received $4.6 billion of ARRA funds in 6 different 
appropriation accounts. The projects selected represent a set of 
investments that will contribute to economic development. The Civil 
Works projects will further these Recovery Act stated purposes of 
preserving and creating jobs and promoting recovery as well as to 
invest in transportation, environmental protection and other 
infrastructure that will provide long term economic benefits .
    The Corps followed the Recovery Act's guidance which included 
commencing expenditures and activities as quickly as possible 
consistent with prudent management. The Corps made its allocation of 
Recovery Act construction funds based on the economic and environmental 
return of its ongoing projects. The projects will achieve the purposes 
of the Recovery Act to commence expenditures quickly by investing in 
infrastructure that will provide long term economic and environmental 
benefits to the Nation. Moreover, the projects are fully consistent 
with the President's direction to ensure that Recovery Act funds are 
spent responsibly and transparently.
    The projects also meet the five criteria enumerated in the 
Congressional report accompanying the Recovery Act, namely that the 
projects:
  --Be obligated/executed quickly;
  --Result in immediate employment;
  --Have little schedule risk;
  --Be executed by contract or direct hire of temporary labor; and
  --Complete a project phase, a project, an element, or will provide a 
        useful service that does not require additional funding.
    Question. I find it interesting that beach renourishment projects 
were deemed not eligible for funding in the Recovery Act and yet when 
the budget was released less than 3 weeks later, beach renourishment 
projects were included in your fiscal year 2010 budget. You had to be 
working on both of these at the same time. How is it that this decision 
was made?
    Answer. The administration has reviewed the policy for beach 
nourishment and re-nourishment in the context of Flood and Storm Damage 
Reduction. After reviewing the policy, the decision was made to have 
beach nourishment and re-nourishment projects compete for funding with 
other Corps construction projects. The decision was made to support the 
highest performing beach nourishment and re-nourishment projects and 
the first opportunity to do so was in the fiscal year 2010 budget.
    Question. It took 5 weeks from the time the President's budget was 
released on May 7 for the COE to provide detailed budget 
justifications. You knew in March what your funding allotment was going 
to be. Reclamation on the other hand did not find out their allotment 
until much later, yet managed to get their justifications released with 
the budget. What was the problem?
    Answer. I regret that the materials were not provided in a timely 
manner. We will work diligently to provide budget materials in a timely 
manner in the future.
    Question. Are you aware of any other agency in the executive branch 
that took this long to get their budget justifications submitted?
    Answer. No.

                   OZARK-JETA TAYLOR POWER PLANT, AR

    Question. I am surprised that the contract for the Ozark-Jeta 
Taylor power plant is not funded for completion in the fiscal year 2010 
budget. This is a project that you have budgeted for in prior years. 
Can you explain why you are not choosing to fund the completion of this 
contract in fiscal year 2010?
    Answer. The Ozark-Jeta Rehabilitation Contract was not funded this 
year because the decision point for allocation of funding to high-value 
projects was made on a performance basis within available resources. 
The Ozark-Jeta Rehabilitation project has a benefit-cost ratio (BCR) of 
1.8, which fell below the 2.5 BCR funding threshold.
    Question. What is the cost to complete this contract?
    Answer. The costs to complete this contract is $33 million.
    Question. What is the cost to terminate this contract?
    Answer. The costs for the termination is estimated to be $20 
million.
    Question. Why couldn't Recovery Act funds have been used to 
complete this project?
    Answer. At the time decisions on Recovery Act project selections 
were made, the Army did not know the full extent of the fiscal year 
2010 budget policies or the impacts on specific projects of such 
decisions. Therefore the Army did not know how Ozark-Jeta would be 
specifically treated in the budget.
    Question. Was the criteria for inclusion in the Recovery Act 
different than the criteria utilized in the fiscal year 2010 budget?
    Answer. Yes, there were many projects funded through the Recovery 
Act that would not be included in the fiscal year 2010 budget.

                                EARMARKS

    Question. Do you or Ms. Archuleta have any idea how President 
Bush's Executive order on earmarks will be enforced by President Obama?
    Answer. No, I do not.
    Question. For fiscal year 2009, Congress referenced all of the 
Corps and Bureau text and tables into the law. Is this causing you any 
execution issues?
    Answer. No.
    Question. Is this contributing to an increase in carry over from 
one fiscal year to the next?
    Answer. No.

                   NORFOLK HARBOR, CRANEY ISLAND, VA

    Question. I notice that you have recommended funding for the 
Norfolk Harbor, Craney Island project as a new start construction 
project for fiscal year 2010. As authorized in WRDA 2007, this project 
is to be 50/50 cost shared between the Federal Government and the local 
sponsor. However, it is my understanding that the Chief of Engineers 
recommendation for the project was that it be cost shared at 4 percent 
Federal costs and 96 percent non-Federal costs.
    Explain to us how a project that was authorized in violation of 
your own policies was funded as a new start in your budget?
    Answer. The decision on which projects to start is based on their 
benefit-cost ratios. This project has a benefit-cost ration of 3.6 to 1 
and was within the range of high-value projects selected for new 
starts. The project was first authorized in WRDA 98 at the 4/96 Federal 
non-Federal cost sharing based on the Chief's report of 1997. The 
budget is based on the project being executed at that cost sharing, 
rather than at the subsequently revised cost sharing.
    Question. Are you aware of any other time that the administration 
has recommended funding for a project that was not authorized in 
accordance with administration policy?
    Answer. Yes, and in that case also the project was budgeted on the 
basis that it would be executed at cost shared in accordance with 
policy.
    Question. What makes this one special?
    Answer. It is a high performing project with a benefit to cost 
ratio of 3.6.
    Question. You proposed $28.5 million for fiscal year 2010 which is 
clearly less than 4 percent of the total project cost of $750 million. 
Your budget justification indicates that once you fulfill the 4 percent 
Federal share that no more funding will be recommended by the 
administration. Are you not then leaving us with the problem of 
fulfilling the cost share authorized in law?
    Answer. The 4 percent share is based on the allocation of project 
costs as shown in the Chief's report of 1998 and reflective of the 
large local sponsor investments that must be made in land-side 
facilities and lands, easements and rights of way.

                      INLAND WATERWAYS TRUST FUND

    Question. You have again proposed a lockage fee as a replacement 
for the current diesel tax on the Inland Waterways as a way to enhance 
revenues in the Inland Waterway Trust Fund. This fee was roundly 
rejected by industry and Congress last year.
    Do you see a different outcome this year?
    Answer. The Inland Waterways Users Board formed an Inland Marine 
Transportation System (IMTS) Investment Strategy Team, with 
participation by representatives of the inland navigation community and 
Corps of Engineers representatives from around the country, to consider 
long-term investment options and to address the shortfall in the Inland 
Waterways Trust Fund (IWTF). The intent of this effort is to reach a 
consensus approach to address this issue.
    Question. Has the administration worked with the Finance or 
Environment and Public Works Committees in the Senate to determine what 
might be acceptable to enhance these revenues?
    Answer. I am not aware of such discussions.
    Question. This subcommittee will write a bill to conform to the 
revenues as they currently exist in the Trust Fund. No solution to the 
inadequate revenue nor forgiveness of the matching requirements of the 
Trust Fund will be proposed by this subcommittee.
    Were other methods to raise revenues besides this fee proposal 
considered?
    Answer. The administration proposal reflects some changes from the 
bill proposed last year, and a number of possibilities are being 
evaluated by the IMTS Investment Strategy Team to address the solvency 
of the IWTF.
    Question. What were they?
    Answer. The IMTS Strategy Investment Team is evaluating options 
such as increasing the current fuel tax, lockage fees, and a 
combination of funding methods.
    Question. How is the economic slowdown affecting the revenues in 
the existing Trust Fund?
    Answer. Revenues generated by the fuel tax are lower in fiscal year 
2008 and fiscal year 2009 than in recent years, about $85 to $87 
million. Revenues generated for the Inland Waterways Trust Fund are 
affected by many factors such as the overall economy, fuel efficiency 
of towboat engines, market conditions for the various commodities 
transported on the inland and intracoastal waterways, etc. At least 
part of the decline in revenues in fiscal year 2008 and fiscal year 
2009 is attributable to the economic slowdown.
    Question. Will we have to slow down work even further?
    Answer. The IWTF projects and corresponding amounts proposed in the 
President's fiscal year 2010 budget are predicated on revenue 
projections of $85 million in fiscal year 2010. The budget also 
provides for using that revenue to bring the few remaining 
rehabilitation projects under construction that were exempt from cost-
sharing in the fiscal year 2009 Omnibus Act back into a 50 percent-50 
percent balance between Construction Appropriations and IWTF. Due to 
the number of projects currently underway, the large funding 
requirements of those projects, and the lack of IWTF resources, 
available revenue will be applied to ongoing projects so as to make 
reasonable progress on high performing projects.

                               EVERGLADES

    Question. I am concerned by your Everglades request of $214.3 
million for fiscal year 2010. This amount is in addition to $123 
million we provided in the fiscal year 2009 Omnibus and more than $100 
million that you have proposed in the Recovery Act. That is nearly $440 
million provided in a matter of months that is intended to be utilized 
no later than September 30, 2010.
    Your track record on expending Everglades funding has not been all 
that great. Do you really believe you can efficiently use this much 
funding this fast?
    Answer. I believe the Everglades program has reached a point of 
maturity where efficient progress can be made using the full amount of 
funds budgeted.
    Question. According to an article in the Miami Herald on June 16, 
issues between the State and Federal Governments over how the State 
will be credited for land purchases are holding up initiation of the 
Picayune Strand project planned for fiscal year 2009. You budgeted 
$21.9 million in fiscal year 2009 to start this project and included 
$40.8 million in the Recovery Act to accelerate the project. It appears 
that none of these funds can be spent based on this article, is that 
correct?
    Answer. The issues described in the Miami Herald all have been 
resolved. The Master Agreement for the Comprehensive Everglades 
Restoration Plan (CERP) is scheduled for execution on August 13, 2009, 
as is the Project Partnership Agreement (PPA) for the Picayune Strand 
project. Following execution of these agreements, the Picayune Strand 
project construction will be initiated. The Corps is prepared to award 
and obligate all of the fiscal year 2009 appropriated funds, as well as 
the ARRA funds provided for Picayune Strand, in October 2009.
    Question. If the dispute is not resolved by October 1, you may 
carry over the $62.7 million planned for the Picayune Strand element. 
In addition, your budget indicates that you have programmed an 
additional $44.4 million in fiscal year 2010. I believe that makes the 
total just over $107 million for this project in fiscal year 2010 if 
the agreements can be worked out on crediting. Is that correct? 
Realistically do you believe you can execute this funding?
    Answer. Yes, $107 million is scheduled to be obligated for work 
planned on the Picayune Strand project, using funds previously 
appropriated and funds budgeted in fiscal year 2010. The execution of 
the Master Agreement and the Picayune Strand Project Partnership 
Agreement as scheduled August 13 will clear the path for construction. 
The first construction contract on the Picayune Strand project is 
scheduled to be awarded in October 2009, and the second contract is on 
schedule to be awarded in fiscal year 2010.
    Question. Your fiscal year 2010 budget proposes two more new starts 
for a total of $70 million. I believe you also have planned new starts 
for Mod Waters that you will be carrying out for the Interior 
Department.
    It appears that there are an awful lot of planned starts and little 
action on getting anything built. I have to ask, is it prudent to 
propose two more new starts in fiscal year 2010, for funding that will 
likely have to be carried over into fiscal year 2011?
    Answer. The fiscal year 2010 budget proposes the initiation of 
construction of two additional CERP projects, the Indian River Lagoon 
South C-44 ($22 million) and Site 1 Impoundment ($25 million). The 
Corps expects to obligate all those funds in fiscal year 2010. The 
Master Agreement will provide a streamlined process toward project 
delivery. With its planned execution on August 13 of this year, the 
CERP program is taking a major step forward in delivery of planned 
projects. Design efforts on the Indian River Lagoon and Site 1 
Impoundment projects will be complete, and construction is ready to be 
initiated, consistent with project sequencing in the Integrated 
Delivery Schedule.
    Question. We have an abundance of needs for that funding in fiscal 
year 2010. Despite the merits of the Everglades project it seems 
imprudent to be ``parking'' large sums of money in the project that 
cannot be utilized. This is not like running into an unexpected 
construction delay. The Miami Herald article indicates that this 
crediting dispute has been ongoing for 4 years. Don't get me wrong, I 
believe that restoration of the Everglades is a worthwhile expenditure 
of taxpayer funds, and this subcommittee has been supportive of it. 
Since fiscal year 2000, this subcommittee has appropriated more than 
$1.3 billion to the various components of Everglades Restoration. That 
is a far bigger commitment than we have made to any other project over 
the same period. However, let's assume that everything falls into 
place. Will there be enough personnel to execute all of this planned 
work? How will this massive infusion of funding for Everglades projects 
affect future Corps budgets?
    Answer. The crediting dispute is now resolved. As for personnel 
available to execute the program, the Corps is accustomed to adjusting 
management and oversight personnel in response to changing program 
levels and has plans in place to adjust personnel levels to short term 
and long term needs of the Everglades Restoration program. Each year we 
will consider the level of construction required to support planned 
Everglades work and balance these needs against the needs of other high 
performing projects.
    Question. In fiscal year 2010, the Everglades gobbles up more than 
13 percent of the Corps construction budget. The next highest funded 
project is the Herbert Hoover Dike, also in Florida, accounting for 
about 8 percent of the construction funds. That means that more than 
one-fifth of your construction money is going to Florida. I realize 
that the work is where the work is, but you can see that this puts me 
in a little bit of a quandary. Senator Feinstein would argue that there 
is plenty of work needed for flood control projects for Sacramento and 
Los Angeles. Senator Landrieu would argue that there is plenty of work 
needed for hurricane protection for the Louisiana Gulf Coast. Senators 
McConnell and Alexander would argue that there is plenty of work needed 
to repair Wolf Creek and Center Hill Dams. Senators Schumer and 
Gillibrand would be happy to tell you about the work that could be 
accomplished on the New York and New Jersey project. It is certainly 
not my intent to pit one Member of the Senate against another, but you 
can see my dilemma. These are all authorized worthwhile projects. Yet 
you have not accommodated their needs in your budget in the manner that 
you have accommodated the Everglades. What am I to tell these members?
    Answer. The administration has made funding decisions based on the 
performance of the projects. As the higher performing projects are 
funded to completion, opportunities to consider other projects will 
expand.
    Question. The budget justification for the Everglades again shows 
more than $4 million in Corps funding for the Modified Waters Delivery 
Plan. I thought Congress was quite clear in the fiscal year 2009 E&W 
bill, that this project should be funded through the Department of the 
Interior. Why is this included in the Corps budget when Congress has 
made it abundantly clear that this project should be funded 100 percent 
by Interior?
    Answer. Completion of the Modified Water Deliveries to Everglades 
National Park Project remains a high priority for the administration. 
The fiscal year 2010 budget reflects the administration's continued 
belief that the Corps and the Department of the Interior each has a 
role to play in restoring flows to the Park.
    Question. How much of the funding that this subcommittee has 
provided for Mod Waters was carried over into fiscal year 2009? How 
much will be carried into fiscal year 2010 based on current 
projections?
    Answer. The unobligated carry over from fiscal year 2008 into 
fiscal year 2009 was $32 million because the Corps was unable to award 
a contract for modifications to Tamiami Trail as a result of 
uncharacteristically high cost growth in the construction industry at 
the time. Since that time, the project scope has been revised and all 
associated issues have been resolved. No currently available funds are 
projected to be carried over into fiscal year 2010--all USACE available 
funds will be obligated on the Tamiami Trail construction contract, 
which is scheduled for award in September 2009.
    Question. I was surprised at your recommendation of more than $100 
million for Everglades' projects in the ARRA. The Everglades projects 
consistently receive one of, if not the highest allocation of funds in 
our annual bill. These annual amounts are supposed to be very close to 
the Corps capability. You notified me in a letter dated June 15 that 
one of the projects, ``Site 1'', has been removed from the ARRA list. I 
believe this project was planned for over $41 million in Recovery Act 
funding. Can you tell me about the decision process that brought you to 
include this project in the ARRA and the decision process to remove 
this project for consideration?
    Answer. The Everglades project is one of the highest value major 
environmental projects that this administration is pursuing. The 
project is of such value that the Army sought to accelerate the current 
plan through the use of ARRA funds. As explained in the referenced 
letter of June 15, 2009, if appropriations for Site 1 are made 
available in the Energy and Water appropriations for 2010 as 
recommended by the President, then Site 1 would be eligible to receive 
Recovery Act monies, if such are available at that time. Should 
Congress not provide construction funds for Site 1 in fiscal year 2010, 
then Recovery Act funds cannot be used for that project.
    Question. How much of the funding is anticipated to be carried over 
from fiscal year 2009 to fiscal year 2010?
    Answer. The estimated carry over from fiscal year 2009 to fiscal 
year 2010 for the South Florida Ecosystem Restoration (SFER) Program is 
$31 million. The majority of carry-over funding is due to delays in 
execution of the Master Agreement and to the receipt of favorable 
contract awards.
    Question. There has been a lot of talk of the State of Florida 
purchasing the lands belonging to U.S. Sugar. If that happens, will 
that affect the analysis of the projects that have already been 
planned?
    Answer. The affects of any lands purchased by the State of Florida 
remains uncertain, since the State has not yet determined their planned 
use of any lands purchased. However, the Corps has determined that the 
U.S. Sugar acquisition is not likely to affect the majority of projects 
identified for early implementation in the Integrated Delivery 
Schedule. Because of its proximity to the lands being acquired and 
potential affects to planned CERP features, the Everglades Agricultural 
Area Phase 1 Reservoir Project Implementation Report development has 
been suspended pending the outcome of the sugar purchase and assessment 
of affects planned use of U.S. Sugar lands may have.
    Question. Put more simply, this would be a major change without 
project conditions. How will that be incorporated into the design of 
current and future projects?
    Answer. The projects currently under construction and in design are 
not likely to be affected. However, it is possible that the State's 
land acquisitions may provide opportunities to improve the CERP Plan. 
The land purchase provides several key areas that may allow for 
substantial savings in the future.
    Question. Might this purchase result in the need for a major 
reevaluation of the suite of projects being considered for the 
Everglades?
    Answer. The projects currently under construction and in design are 
not likely to be affected. If the State indicates its intent to make 
the lands available for potential use in the CERP, the Corps would 
prepare a report to assess these opportunities, which would then be 
evaluated in detail in Project Implementation Reports and proposed for 
authorization.
    Question. There has been considerable discussion of global climate 
change and sea level rise in the media. Some of the more extreme 
projections I have seen show much of Southern Florida under water. 
While that is a possibility, how is the design of the current projects 
considering global climate change?
    Answer. The September 2008 Biennial Report to Congress recommended 
that additional studies be undertaken to determine sensitivity of 
restoration efforts to sea level rise. A CERP Technical Data report is 
now being developed to identify the potential impacts for a range of 
sea level rise scenarios. The initial draft of this Technical Report is 
expected to be available in late 2009.
                                 ______
                                 
            Questions Submitted by Senator Mary L. Landrieu

    Question. In late 2005, following hurricanes Katrina and Rita, 
Congress directed the Secretary of the Army (Public Laws 109-103 and 
109-148), acting through the Chief of Engineers, to conduct a 
comprehensive hurricane protection analysis and design in close 
coordination with the State of Louisiana and its appropriate agencies; 
to develop and present a full range of flood control, coastal 
restoration, and hurricane protection measures exclusive of normal 
policy considerations for South Louisiana; to consider providing 
protection for a storm surge equivalent to a Category 5 hurricane; and 
to submit a preliminary report within 6 months of enactment and final 
technical reports within 2 years. We now refer to this report as the 
LACPR or Louisiana Coastal Protection and Restoration Study or the 
``Category 5 Report''.
    Mr. Secretary and General, I understand that this report is now 
under further public review, but can you please detail for this 
subcommittee why is this report is nearly 2 years late? Additionally, 
please detail how the money appropriated for this report has been 
spent? Lastly, when the report is transmitted--will it contain specific 
recommendations for the authorizations of projects?
    Answer. Inserted below is a letter that was forwarded on February 
9, 2009 to the President of the Senate regarding the progress of the 
Louisiana Coastal Protection and Restoration (LACPR) Technical Report. 
It also discussed actions required to complete the technical report.
    As indicated in the letter, the Corps has worked diligently to 
ensure that the report addresses the entire scope of issues required by 
statute, including developing a full range of flood control, coastal 
restoration, and hurricane protection measures without regard to normal 
policy considerations related to the economic justification of 
projects, as well as to submit a final technical report for protection 
from Category 5 storm events.
    The Corps also has worked to coordinate its efforts with State and 
Federal agencies, obtain independent external peer review, and 
incorporate lessons learned from the Interagency Performance Evaluation 
Task Force.

                            Department of the Army,
                         Office of the Assistant Secretary,
                                  Washington, DC, February 9, 2009.
Honorable Joseph R. Biden, Jr.,
President of the Senate,
U.S. Capitol Building, Room S-212,
Washington, DC 20510-0012.
    Dear Mr. President: This letter is to advise you of the current 
progress of the report for Louisiana Coastal Protection and Restoration 
(LACPR) that is being prepared in response to the Energy and Water 
Development Appropriations Act of 2006 and the Department of Defense, 
Emergency Supplemental Appropriations to Address Hurricanes in the Gulf 
of Mexico, and Pandemic and Influenza Act, 2006.
    These statutes directed the Chief of Engineers to conduct a 
comprehensive hurricane protection analysis and design; to develop a 
full range of flood control, coastal restoration, and hurricane 
protection measures exclusive of normal policy considerations for South 
Louisiana; and to submit a final technical report for ``Category 5'' 
protection. The final report was originally scheduled for completion in 
December 2007. However, as described in my letter to you of December 
20, 2007, due to the magnitude and scope of the work being considered, 
the complexities of the study, and the necessity to provide a clear and 
fully informed report, additional time was needed to revise the draft 
technical report and to ensure its full coordination with State and 
Federal agencies, including critical independent external peer review 
by the National Academy of Sciences (NAS).
    While this study was underway, we incorporated the extensive 
knowledge and lessons learned from the Interagency Performance 
Evaluation Task Force (IPET) which itself was conducted under the 
review of the American Society of Civil Engineers and the independent 
peer review of NAS. Many of the models and tools that were developed by 
the IPET team provided a critical foundation to this study. Included 
within this study will be a systems analysis of both LACPR and the 
Mississippi Coastal Improvement Program (MSCIP). This continued 
analysis will ensure that we maintain a systems perspective for the 
region.
    The study authorization directed that the recommendations of this 
study not be constrained by normal policy considerations (i.e., not be 
constrained by the ratio of their projected costs to their projected 
benefits). U.S. Army Corps of Engineers (Corps) policy is to recommend 
to Congress a single plan that maximizes net economic benefits in 
meeting the study objectives. Without such a definitive discriminator 
the Corps' design recommendations could default to simply the most 
effective means of providing the required protection, but this approach 
undoubtedly would come at great cost, both to the Treasury and to the 
ecosystem. It is apparent, therefore, that decisions made by Congress 
regarding the activities to be authorized will need to be supported by 
a report that arrays the available information in a way that the 
relative advantages and disadvantages of the various courses of action 
can be readily displayed. An undertaking of such scope and complexity 
as providing comprehensive storm surge protection within a dynamic 
coastal and riverine environment and within an environmentally and 
socially-sensitive framework is an undertaking that requires supporting 
information of far greater scope and complexity than has ever been 
developed for other Civil Works projects.
    Consequently, a new tool to support the decisionmaking process has 
been developed by the Corps. The ``risk informed decision framework'' 
was utilized in both Gulf Coast studies to array the various 
alternatives that are considered most likely to be implementable, along 
with the assessments of various stakeholders, in a way that 
communicates the relative advantages and disadvantages of each. As a 
result of this process, decisionmakers should be able to make a well-
informed decision as to which alternatives can be knit into a holistic 
and systematic solution to the problems and are worthy of further 
pursuit.
    Over the past year, the Corps has worked in partnership with the 
State of Louisiana and other Federal agencies to refine the final array 
of alternatives which would make the Louisiana coast more resilient to 
future storm events. Tremendous efforts have been undertaken by the 
Corps and our partners toward the production of the final report. 
Approximately 20 meetings were held across the Louisiana coast with 
stakeholders and our Federal partners. There was also a critical need 
to ensure that the Corps completed an independent external peer review 
by the NAS. The NAS has provided initial comments and will be 
completing a final review within the next few months. Its initial 
comments are being addressed in the revisions to the technical report.
    In the coming months, the Corps will circulate draft and final 
reports, formerly coordinate the final report with the Governor of 
Louisiana and the Federal agencies, and undertake a final review 
process. The final report will include an array of alternatives with 
evaluation results for each alternative and a comparison of top-ranked 
plans based on input from stakeholders. This will include a ranking of 
alternatives that provide hurricane and storm risk reduction from an 
array of ``Category 5'' storm events. Due to the size and complexity of 
the Louisiana coastal system, a preliminary level of design and cost 
information is included, but a programmatic environmental impact 
statement will not be part of the submission package. The final 
technical report will provide a basis for sound, risk based, 
consideration of possible actions to manage storm surge related risks 
and will take into account previously authorized projects and those 
requiring further analysis.
    The Corps advises me that it will be in a position to submit a 
final report that is responsive to congressional and administration 
directions to this office by August 31, 2009. The Corps will also 
provide an implementation framework with the report. Once the Corps 
provides the complete documentation for the LACPR study, my office and 
the Office of Management and Budget will evaluate the report and 
provide an administration position on further recommendations. I am 
providing a copy of this letter to the Senate Subcommittees on Energy 
and Water Development, and Transportation and Infrastructure.
            Very truly yours,
                                    John Paul Woodley, Jr.,
                                   Assistant Secretary of the Army.
    Since the 2005 authorization, the Corps has obligated and expended 
approximately $22,769,000 on the LACPR Project, as follows:

------------------------------------------------------------------------

------------------------------------------------------------------------
Planning and Project Management............................   $9,561,000
Engineering & Design.......................................    3,944,000
Socioeconomics and Analysis................................    2,919,000
Environmental Studies......................................    1,005,000
Real Estate Investigations.................................       52,000
Multi-Criteria Decision Analysis (MCDA)....................      849,000
Public Outreach............................................      783,000
Other Federal Agencies.....................................      980,000
Report Development.........................................      535,000
Agency Technical Review (ATR)..............................      765,000
External Peer Review.......................................      876,000
Dutch Shadow Plan..........................................      500,000
                                                            ------------
      Total................................................   22,769,000
------------------------------------------------------------------------

    In lieu of specific construction recommendations, the technical 
report recommends implementation options and a path forward beyond the 
technical report.
    The report will require Congress and the administration to make 
tradeoffs with the input of other Federal agencies, the State, local 
government, other stakeholders, and the public. These decisions will 
involve billions of dollars and will impact the coast and its people 
over the next 50 to 100 years.
    All of the final alternative plans may have social and economic 
impacts requiring further evaluation and stakeholder input. The Corps 
will implement recommended projects in the most expeditious manner 
available by maximizing the use of available construction and study 
authorities (i.e., modifications of on-going projects/studies, post-
authorization change reports, or new authorizations).
    Question. In WRDA 2007, the Congress authorized the Louisiana 
Coastal Area or LCA. This authorization provides --for the first time--
authorization for coastal wetlands restoration in Louisiana. What is 
the status of this program in general and what is the timetable for 
creating a master plan under this program as required by the act? Has a 
task force been established? If not, why?
    Answer. The authorization for the Louisiana Coastal Area as 
identified in the Chief's Report dated January 31, 2005 required 
additional investigations prior to the initiation of construction. 
Overall, 12 project investigations are underway with 10 of those 
investigations starting after the enactment of WRDA 2007. I am advised 
that the investigations for the features authorized in section 
7006(e)(3) of WRDA 2007 are on track for completion of a Chief's Report 
by December 31, 2010 (as required by section 7006(e)(3)(B). The 
investigations for the features authorized by section 7006(e)(1) are 
scheduled to be completed by November 2011. The investigation for the 
Beneficial Use of Dredged Material Program authorized in section 
7006(d) is scheduled to be completed by July 2010. The investigation 
for the Barataria Basin Barrier Shoreline feature authorized by section 
7006(c) also is scheduled to be completed by July 2010, although issues 
remain to be resolved. The project management plans for the 
investigations for the other features that require submittal of a 
construction report, as outlined in section 7006(c), are being 
coordinated with the State of Louisiana.
    WRDA 2007, title VII, section 7002 provides for the development of 
a Comprehensive Plan. Given the importance of and the extensive, 
ongoing efforts to implement the restoration plan authorized in title 
VII, no work will be initiated to develop a comprehensive plan until 
such time as funds are appropriated.
    Section 7004 of WRDA 2007 establishes the Coastal Louisiana 
Ecosystem Protection and Restoration Task Force (Task Force), but to 
date, funds have not been appropriated to implement section 7004. In 
the interim, the Corps New Orleans District and Mississippi Valley 
Division have successfully engaged Federal and State agency 
representatives at the regional level throughout the study process for 
the Louisiana Coastal Protection and Restoration study and the 
Louisiana Coastal Area program. Similarly, Corps Headquarters has 
engaged Washington-level Federal Principals throughout the study 
process for these efforts. These meetings have been an efficient and 
effective way to communicate and solicit input from the agencies. Until 
funds are appropriated for the Task Force, the Corps will continue to 
engage the Federal and State agencies through the regional working 
group and Federal Principals Group.
    Question. The Corps of Engineers is currently re-evaluating 
Morganza to the Gulf Hurricane Protection project due to projected cost 
overruns. This situation is unacceptable. Congress has done its job by 
authorizing this project and the Corps should move quickly to sign the 
Record of Decision, remove any remaining obstacles and get to work. 
What is the status of this re-evaluation? Will the State and local 
government receive credit for the nearly $200 million they have 
appropriated for this project? In the long term, how with the Corps 
work with State and local partners to allow them to move forward with 
interim measures of protection on critical Federal projects and receive 
credit for this critical work?
    Answer. Section 1001(24) of the Water Resources Development Act of 
2007 (WRDA 2007) authorized 100-year level of risk reduction for 
Morganza to the Gulf based on the Chief of Engineer's Reports completed 
on August 23, 2002, and July 22, 2003. Due to changes in hydraulic 
conditions and design criteria established following Hurricanes Katrina 
and Rita in 2005, a revised project cost estimate was completed in 
October 2008. In this analysis the Corps applied the lessons learned 
and engineering design recommendations for improving the performance of 
hurricane and storm damage risk reduction systems that were identified 
by the Interagency Performance Evaluation Task Force (IPET). The 
results of the revised project cost estimate clearly show that the cost 
to provide post-Katrina 100-year level of risk reduction will exceed 
the authorized project cost by more than 20 percent, thereby exceeding 
the limit imposed by section 902 of WRDA 1986 and triggering the 
requirement for additional authorization. A Post Authorization Change 
(PAC) Report is being prepared to reaffirm the Federal interest and 
seek additional authorization. The PAC Report is scheduled for 
completion by December 2012. Initiation of construction of the Morganza 
to the Gulf project will be dependent upon additional Congressional 
authorization and appropriation of construction funds.
    As is the case for all Work-In-Kind credit, the non-Federal 
sponsor's design and construction will be reviewed for compliance with 
the Hurricane and Storm Damage Risk Reduction System guidelines, and a 
credit determination will be made on a case-by-case basis for each 
project feature.
    In order to maximize the amount of Work-In-Kind credit our State 
and local partners may receive, the Corps will continue to help our 
partners comply with the Hurricane and Storm Damage Risk Reduction 
System guidelines, considered the Federal standard. Specifically, the 
Corps will review and comment on the local sponsor's real estate 
acquisitions, relocations and engineering designs in a timely manner. 
The Corps will also conduct periodic field inspections on the local 
sponsor's construction sites, provide inspection reports, and work with 
the sponsor if any remedial actions are required to meet the Federal 
standard. In order for credit to be awarded, the project will have to 
be reauthorized, construction funds will have to be appropriated, a 
Record of Decision will have to be signed and a Project Partnership 
Agreement (PPA) will have to be executed.
    For any work performed by the our State and local partners in 
advance of the execution of a project partnership agreement to be 
eligible to receive a credit, the reauthorization of the project must 
include a provision that authorizes the Government to provide credit to 
the sponsor for the reasonable and allocable costs of the work 
performed in advance of the execution of the project partnership 
agreement and that the provision of such credit shall be subject to a 
finding by the Government that the said work is compatible with the 
Federal project, is constructed to a design standard that is acceptable 
to the Chief of Engineers, is economically justified and 
environmentally acceptable.
    Question. The Harbor Maintenance Trust Fund (HMTF) was created to 
provide the necessary funding to keep our harbors, ports and waterways 
safe and navigable; yet, the HMTF takes in far more revenues each year 
than it spends despite a backlog of approved projects. (NOTE: In fiscal 
year 2009, due to multiple supplemental appropriations bills including 
those for natural disasters, HMTF expenditures equaled revenues, but 
this is the rare exception, and our ports shouldn't be put in a 
position where they should have to depend on such supplementals simply 
to receive funding for necessary projects). Now that there is a 
substantial balance in the fund, don't you think annual expenditures 
should at least equal annual revenues? Do you think the HMTF should be 
restructured in order to more effectively use the funds collected?
    Answer. The overall Operation and Maintenance (O&M) program is 
prioritized for all missions, including navigation, flood risk 
management, hydropower, etc. O&M funding is budgeted for the diverse 
Civil Works missions based on performance metrics and priorities. The 
O&M budget includes funding for critical maintenance of the highest use 
navigation channels and harbors. If the HMTF funded activities were to 
be increased, other critical mission areas would be adversely impacted.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett

              OZARK-JETA TAYLOR HYDROPOWER REHABILITATION

    Question. I am aware that it is the Corps's policy, and that of 
this Congress, to enter into Continuing Contracts only when they are 
necessary for efficient construction. Congress has limited the Corps 
use of continuing contracts to insure that they are only used when 
necessary, and with the understanding that the Corps will budget these 
contracts efficiently through to completion. You have not budgeted for 
the continuation of the Ozark-Jeta Hydropower Rehab project, which will 
deliver clean, renewable energy into the foreseeable future when 
finished, even as you have budgeted extraordinary amounts for the 
Everglades where the benefits are much less tangible. Further, my 
understanding is that you require only $30 million to complete the 
contract and it will cost $20 million to terminate the contract. To not 
budget to continue this contract appears to be not only bad government, 
but also to contradict past Corps policy regarding budgeting for 
continuing contracts. Please provide the rationale for failing to 
budget to continue the work on the Ozark-Jeta Hydropower Rehab 
Continuing Contract?
    Answer. The Ozark-Jeta Rehabilitation Contract was not funded this 
year because the decision point for allocation of funding to high-value 
projects was made on a performance basis within available resources. 
The Ozark-Jeta Rehabilitation project has a benefit-cost ratio (BCR) of 
1.8, which fell below the 2.5 BCR funding threshold.
    Question. The work for the Ozark-Jeta Hydropower Project is almost 
two-thirds complete. Not only has the Federal Government invested more 
than $44 million to date, the non-Federal sponsors for this project, 
the Southwestern Power Marketing Association, have invested $20 million 
of their money. By your estimate, it will cost $20 million to pay the 
contractor to terminate this contract. Do you have any plans to 
reimburse the SWPA or their rate payers for their out-of-pocket costs? 
Did you consider the impact of this decision on the rate payers?
    Answer. As sponsors and signatories to the Project Cooperation 
Agreement for the project, the SWPA and/or their rate payers are 
subject to paying their share of the costs incurred by the project, 
even those for termination for convenience without reimbursement by the 
Corps or the Federal Government. The Army does not have authority to 
reimburse SWPA.
    Question. I understand that at least one turbine has already been 
dismantled and that an additional turbine has been ordered. What do you 
plan to do with the turbine that has been ordered--let it rust?
    Answer. The Army is currently working with the contractor to assess 
the project schedule to incorporate current funding constraints. Our 
goal is to develop a plan that will allow for beneficial use of all 
funded features of the project.
    Question. How do you expect additional funds ``to become 
available'' if you don't budget for the project? Are you leaving it up 
to this subcommittee to fix this problem? Does it require a 
congressional add, which is disparaged by the administration, to 
correct this lapse in judgment on the Government's part?
    Answer. The Army is looking at other options for funding of the 
project in fiscal year 2010. The Army is working with the Southwestern 
Power Administration, the agency in the Department of Energy 
responsible for marketing the power generated at Ozark, to identify 
``customer funding'' to continue contractor activities. The Army is 
also assessing the potential to fund fiscal year 2010 scheduled work 
with ARRA funding. If neither of these possibilities work out, the 
project will be put in caretaker status subject to funds coming 
available.
    Question. Mr. Secretary, How much energy will be lost as a result 
of not funding this project?
    Answer. According to the Southwestern Power Administration, the 
amount and value of the lost energy due to forced outages at Ozark for 
the last 2 fiscal years is 82,420 MWh valued at $5.1 million in fiscal 
year 2007; and 153,550 MWh valued at $9.5 million in fiscal year 2008. 
That rate of loss would continue or increase.
    Question. Mr. Secretary, What will happen to the Corps and contract 
workers when this project is terminated?
    Answer. This project is being constructed concurrently with the 
Webbers Falls Powerhouse rehabilitation project. If the Ozark 
Powerhouse Rehabilitation work is suspended or terminated, Corps and 
contract workers will be shifted from Ozark to Webbers Falls. At this 
time, the Corps does expect any employees will be terminated.
    Question. Mr. Secretary, I notice that you have funded the Richard 
B. Russell Powerhouse Rehab project when it has a benefit-cost ratio of 
1.9 which is lower than the BCR of Ozark-Jeta, AR project which is 2.4. 
Can you explain why these two projects which appear to be the same were 
treated differently in the budget?
    Answer. While Richard B. Russell is a Hydropower project on the 
Savannah River in GA and SC, the item budgeted for fiscal year 2010 is 
an environmental mitigation piece of the project. The work essentially 
deals with environmental monitoring of the oxygen injection system. 
Funds are budgeted for procurement and fabrication of 50 percent of the 
Government furnished equipment associated with the underwater diffuser 
system. For the record, the Ozark-Jeta project has a current benefit to 
cost ratio of 1.8.

                             BUDGET REQUEST

    Question. In your press release on the fiscal year 2010 budget you 
state that ``The budget represents the prudent level of investment in 
the Nation's water infrastructure and in the restoration of its aquatic 
resources. I am proud to present it.''
    What exactly are you proud of? Is it the more than 100 on-going 
construction projects funded in fiscal year 2009 that are not addressed 
in this budget, or is it the $227 million decrease from what we 
provided in the fiscal year 2008 Omnibus?
    Answer. I am proud of the fact that the fiscal year 2010 budget 
provided an increase of nearly 9 percent above previously budgeted 
levels for the Corps of Engineers water program. The budget includes 
$5.125 billion in new Federal funding for the Civil Works program, the 
highest budget ever proposed for the Civil Works program.
    The fiscal year 2010 budget provides critical funding that will 
enable the Corps to continue to contribute to the Nation's efforts to 
revitalize the economy, and restore the environment.
    Question. Is it prudent not to provide funding for projects that 
have been under construction for years?
    Answer. Projects funded through the fiscal year 2010 budget are the 
highest performing projects in their respective categories, and it is 
important to fund these projects as efficiently as possible.
    Question. What are we supposed to tell the project sponsors that 
are sharing in the costs of these projects?
    Answer. The administration has made funding decisions based on the 
performance of the projects. As the higher performing projects are 
funded to completion, opportunities to consider other projects will 
expand.
    Question. It will cost them more. It will cost us more. Again, how 
is this prudent?
    Answer. By focusing available funding on the highest performing 
projects in their categories, those projects can be completed more 
efficiently and their benefits brought on line sooner.
                                 ______
                                 
           Questions Submitted by Senator George V. Voinovich

    Question. Should the Great Lakes Navigation System be funded as a 
``system'' the way the Mississippi River System is?
    Answer. The Great Lakes projects are individually authorized and 
are considered coastal projects. While there is some interdependence of 
the Great Lakes ports and harbors on each other, the Great Lakes system 
is non-linear and many Great Lakes ports and harbors can operate 
independent of other harbors. Conversely, the inland navigation 
facilities on the Mississippi River, Ohio River, and other inland 
waterways are linear and interdependent on each other, and a single 
closure in the system will stop all traffic. For other than short-haul 
movements, the commercial towing vessels must transit through many 
locks and dams to move from the point of origin to the destination 
point and all the inland navigation infrastructure along the way must 
be functional for the trip to occur.

               THE AMERICAN RECOVERY AND REINVESTMENT ACT

    Question. It is my understanding that the Corps used ``geographic 
diversity'' when allocating stimulus funds. However, the Great Lakes 
region, encompassing eight States, received only 2 percent of the $4.6 
billion in civil works funding. Can you explain?
    Answer. The geographic diversity element was considered in the 
sense that the entire United States was canvassed for projects. ARRA 
projects are funded in 49 States, the District of Columbia, and Puerto 
Rico.
    When the bill was enacted, the USACE received $4.6 billion in 
American Recovery and Reinvestment Act (ARRA) funds in six different 
appropriation accounts. Each account has a purpose directed in statute 
and ARRA funding was directed or otherwise targeted to account 
capability. The projects selected represent a set of productive 
investments that will contribute to economic development and aquatic 
ecosystem restoration. The Civil Works projects will further these 
Recovery Act stated purposes of preserving and creating jobs and 
promoting recovery as well as to invest in transportation, 
environmental protection and other infrastructure that will provide 
long term economic benefits.
    The Corps followed the Recovery Act's guidance which included 
commencing expenditures and activities as quickly as possible 
consistent with prudent management. The Corps made its allocation of 
Recovery Act construction funds based on the economic and environmental 
return of its ongoing projects. The projects will achieve the purposes 
of the Recovery Act to commence expenditures quickly by investing in 
infrastructure that will provide long term economic and environmental 
benefits to the Nation. Moreover, the projects are fully consistent 
with the President's direction to ensure that Recovery Act funds are 
spent responsibly and transparently.
    The projects also meet the five criteria enumerated in the 
Congressional report accompanying the Recovery Act, namely that the 
projects:
  --Be obligated/executed quickly;
  --Result in high, immediate employment;
  --Have little schedule risk;
  --Be executed by contract or direct hire of temporary labor; and
  --Complete a project phase, a project, an element, or will provide a 
        useful service that does not require additional funding.
                                 ______
                                 
      Questions Submitted to Lieutenant General Robert Van Antwerp
             Question Submitted by Senator Mary L. Landrieu

    Question. A large amount of goods move in and out of our Nation's 
ports, and these ports play a vital role in our Nation's economy. 
Louisiana has some of the largest and most critical ports in our entire 
Nation. Navigable and safe ports are also essential to our Nation's 
security. Do you think the Army Corps of Engineers should take national 
security into account when it prioritizes funding for operations and 
maintenance projects? How will this new administration ensure that our 
ports are secure and maintained for this critical commerce?
    Answer. The impacts of a potential waterway closure due to loss of 
channel dimensions and/or lock/structure failure and its criticality to 
the navigation infrastructure are considered and weighted along with 
economic, environmental, safety, and industry impact factors. In 
addition, as a response to the Maritime Transportation Security Act of 
2002, Corps locks were assessed for criticality and risk reduction to 
infrastructure and security upgrades were implemented at critical locks 
and maintained through project operations and maintenance funds.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett

                          CIVIL WORKS PROGRAM

    Question. In your role as the Chief of Engineers, what do you see 
as the major water resource challenges facing this Country in the 
future.
    Answer. Some of the major challenges are in the area of developing 
new strategies to operate and manage existing water infrastructure in a 
sustainable manner that not only meets the Nation's contemporary water 
resources needs, but also adapts to changing conditions such as climate 
change and demographic shifts to ensure such resources are available 
for future generations. Competing water uses must be balanced to 
provide multiple benefits such as economic security, environmental 
health, social well-being, and public safety. For example, navigation 
projects must be designed and operated to not only safely and 
efficiently convey vessels and cargo to ports and waterways, but do so 
in an environmentally responsible manner. Flood risk management 
projects must simultaneously reduce flood risks and sustain healthy 
ecosystems. To address these competing demands, the Corps is beginning 
to undertake a new overarching strategy called Integrated Water 
Resources Management, which seeks to foster equitable, efficient 
management and sustainable use of water. There is much work to be done 
but it will lead to significant gains in these areas.
    Question. What level of funding would be necessary to maintain the 
progress realized in the Civil Works Program through the enacted 
appropriations levels for the past couple of years?
    Answer. This is truly a difficult and challenging question, in this 
time of significant funding for the Corps of Engineers Civil Works 
program. The Corps is currently working with over $20 billion that have 
been provided through a variety of appropriations, including not only 
regular Energy and Water appropriations, but also the American 
Reinvestment and Recovery Act and emergency supplemental funding. That 
is an unprecedented amount of money for the Corps of Engineers.
    Question. If the administration's budget proposal is enacted, what 
will be the impact on meeting the Army Corps' O&M backlog? The 
construction backlog?
    Answer. The fiscal year 2010 budget does not reduce the magnitude 
of the O&M and construction backlog. However, the budget is the 
appropriate mix of Construction and O&M funding and will enable the 
Corps to meet essential construction, operation, maintenance, and 
rehabilitation requirements in the Civil Works program. The O&M backlog 
and the Construction backlog do not represent a prioritization of work 
within either of the two accounts or between the accounts. The priority 
of work in the backlog varies widely.
    Question. What is the percentage of the Nation's commerce that come 
into or leaves this Country that goes through a Corps built and 
maintained harbor?
    Answer. The Corps of Engineers has 299 deep draft coastal harbor 
channels. Virtually all the waterborne cargo passes through a Corps 
navigation project, and anecdotal evidence indicates the vast majority 
of all import and export commerce passes through them. The Corps of 
Engineers doesn't track waterborne commerce in a way that enables me to 
provide a more specific answer to your question.
    Question. Could you characterize the proportion of the 
discretionary budget of the Federal Government that is directed toward 
building and maintaining this Country's water infrastructure today 
versus 30 years ago?
    Answer. Multiple agencies, including the Department of the Interior 
(Bureau of Reclamation), were provided resources for building and 
maintaining the Nation's water infrastructure. The Corps of Engineers, 
in fiscal year 1979, was provided 1 percent of the discretionary budget 
of the Federal Government for civil works projects and programs.
    In fiscal year 2009, 1.07 percent of the Federal Government's 
discretionary budget was provided for the Corps of Engineers. However, 
given the magnitude of changes in the Nation and in Federal programs, 
it is not clear that these percentages are meaningful.
    Question. Could you provide a historical perspective on the value 
of the Nation's inland waterways for national security and economic 
security?
    Answer. Navigation has been very important to national security and 
economic security for over 200 years. The benefits of navigation accrue 
to the Nation as a whole, with 31 States directly served by the 12,000 
mile commercial inland waterways. This helps to explain the major 
Federal interest in our Inland Marine Transportation System (IMTS).
    The IMTS is a major transportation mode and the Nation's industrial 
and agricultural sectors would be profoundly affected without an 
efficient, effective and safe Inland Marine Transportation System. The 
waterway system annually handles well over 600 million tons of cargo 
valued at over $112 billion. This includes energy commodities such as 
coal; petroleum and related products; construction materials; grain and 
other farm products, which move by waterways to ports for export; 
industrial and agricultural chemicals; forest products; and 
manufactured goods.
    The waterways play an important role is the movement of military 
equipment, supplies, fuel, and many defense-related raw materials and 
finished products. Over the years since World War II the use of the 
waterway system for national security purposes has shifted from rapid 
mobilization to a more lengthy mobilization. The waterway system now 
plays a role in the long-term or advance movement of military supplies, 
cargo, equipment, fuel, and industrial materials. With a longer 
mobilization scenario there is increased consideration of civil and 
industrial as well as military transportation needs. The interpretation 
of national defense transportation needs now includes three components: 
traditional military mobility, industrial mobility to support a 
conflict, and support for a mobilized civil economy. This paradigm 
places additional emphasis on the use of the inland waterways.
    Question. How much unobligated funding did the Corps carry over 
from fiscal year 2008 to fiscal year 2009?
    Answer. Unobligated funding carried over in the accounts receiving 
annual appropriations is as follows.

                        [In millions of dollars]
------------------------------------------------------------------------

------------------------------------------------------------------------
Investigations.............................................         92
Construction...............................................      1,461
Operation & Maintenance....................................        432
Mississippi River and Tributaries..........................         95
Formerly Utilized Sites Remedial Action Program............          5
Flood Control and Coastal Emergency........................      3,516
Regulatory Program.........................................         12
Expenses...................................................          1
                                                            ------------
      TOTAL................................................      5,614
------------------------------------------------------------------------

    These figures do not include funds appropriated in Public Law 110-
252 and not available for until fiscal year 2009, or funds appropriated 
in Public Law 110-329 that were not available until fiscal year 2009.
    Question. To what do you attribute this large carryover?
    Answer. About $4.4 billion of the total is supplemental funds 
appropriated to respond to emergency events. Often, obligations for 
project repairs and restoration activities following emergency events 
extend beyond the fiscal year in which the emergency events occur. In 
particular, about $3.5 billion of the supplemental funds carried over 
are Construction funds and Flood Control and Coastal Emergency funds 
being used in the program to protect the New Orleans metropolitan area, 
which is scheduled for completion in fiscal year 2011.
    About $1.2 billion is regularly appropriated funds being carried 
over on a variety of projects. This level of carryover is not 
unexpected, given that funds by and large are remaining on the projects 
for which they were provided, with minimal reprogramming compared to 
years before fiscal year 2006.
    Question. Do you anticipate another large carry over balance from 
fiscal year 2009 to fiscal year 2010?
    Answer. In fiscal year 2009 the Corps received, in addition to 
regular appropriations of $5.4 billion, supplemental funding of $9.3 
billion under Public Laws 110-252, 110-329, and 111-32, plus $4.6 
billion of funding under the American Recovery and Reinvestment Act, 
2009, Public Law 111-5. Of the supplemental funding, $5.8 billion is 
for the New Orleans metropolitan area, and much of the rest is for 
repairs and restoration activities that can extend into fiscal year 
2010.
    In addition, just under one-half of the Recovery Act funding will 
be obligated in fiscal year 2009. Therefore, there will be significant 
carryover into fiscal year 2010.
                                 ______
                                 
           Questions Submitted by Senator George V. Voinovich

                              GREAT LAKES

    Question. The Corps has dredged at less than the ``break-even'' 
line for virtually every year in the last decade for the Great Lakes. 
The only year, fiscal year 2008, in the last decade when the Corps 
dredged above the break-even point occurred because Congress added 
significant funding for that purpose. The Corps responded with a 
proposed administration Great Lakes budget for fiscal year 2009 that 
drastically cut the enacted amount. Please explain why there is so much 
resistance to dredging at or above the break-even point? Is it common 
in other regions to hit the break-even level of dredging only 
occasionally over an extended period of years?
    Answer. The President's fiscal year 2010 budget for navigation 
Operation and Maintenance for the Great Lakes is a $4 million increase 
over the fiscal year 2009 program. Competition for Federal funds is 
very keen and gets tighter each year. Our Operation and Maintenance 
(O&M) funding requirements continue to grow as the infrastructure ages, 
newly constructed projects are added to our inventory, and costs 
increase. The Corps budgets for many worthwhile operation and 
maintenance needs across the entire spectrum of Civil Works projects by 
prioritizing projects based on maximizing benefits. In navigation, the 
focus is on harbors and waterways that have high volumes of commerce.
    Question. The 2008 Army Corps document, Great Lakes Navigation 
System: Economic Strength to the Nation, describes the Great Lakes as 
having a dredging backlog that has ``grow[n] to an unprecedented level 
in major navigation channels and harbors.'' How can the Corps ever 
address the estimated $200 million Great Lakes dredging backlog when 
the Corps keeps dredging at less than the break-even level?
    Answer. The Corps has not been able to keep pace with annual 
channel sedimentation and within a relatively short period (e.g., 5 
years) cannot address prior years' accumulations (backlog) under 
historical funding levels. In fiscal year 2008 the Corps reduced the 
backlog in dredging quantity from 18 million cubic yards to 17 million 
cubic yards. Once the Corps completes the dredging funded by the fiscal 
year 2009 Omnibus and Recovery Act appropriations, the backlog will be 
reduced to 15.3 million cubic yards. These appropriations enabled us to 
address the backlog dredging needed to move toward a high performing 
Navigation system.
    The Corps could address the dredging backlog by planning other 
possible alternative control measures including higher efficiencies and 
a Demonstration Regional Commercial Efficiency Dredging Program. While 
the Corps always seeks to execute our programs in the most efficient 
manner possible, efficiencies addressing the dredging process are 
currently under review. For example, working with the States and other 
agencies toward less restrictive environmental windows to increase the 
time available to dredge in particular harbors will help reduce costs. 
The Corps plans to work with dredging contractors to find ways to 
reduce costs and plan to work with States to explore reducing 
restrictions on open water disposal and thus reduce filling rates for 
expensive Confined Disposal Facilities.
    The Corps will renew emphasis on beneficial use of dredged material 
and to open a dialog with State agencies for a scientifically-driven 
review of open water disposal policies to ensure that the environmental 
protections are achieved at the least cost to the taxpayers. A 
technical plan ``Demonstration Regional Commercial Efficiency Dredging 
Program'' using highly efficient, more technically advanced equipment 
to augment the typical annual dredging process will be prepared. This 
is the most promising prospective remedial action to address the 
dredging backlog but must be worked in concert with the other potential 
efficiency improvements. Solutions will be planned considering other 
competing national needs which have historically challenged resourcing 
backlog projects in the Great Lakes; however our goal is unwavering to 
meet the needs of waterborne commerce on the Great Lakes by making 
steady progress in reducing the dredging backlog.
    Question. Does the Corps consider the ``source of funds'' when 
making budget decisions? For example, shouldn't a project funded by 
industry via the Harbor Maintenance Trust Fund receive a higher 
priority than one funded by the taxpayers or cost shared by the 
taxpayer? Why doesn't the Corps spend what it collects from the Harbor 
Maintenance Trust Fund on eligible projects?
    Answer. The Corps of Engineers has a number of cost-sharing 
authorities for the Civil Works program. The source of funds is just 
one of many factors considered in the budget development process. The 
Corps of Engineers' overall Operation and Maintenance (O&M) program is 
prioritized for all missions, including navigation, flood risk 
management, hydropower, etc. Funding is budgeted for the diverse Civil 
Works missions based on various metrics and priorities within available 
resources,. and other critical mission areas would be adversely 
impacted if the funding for those activities were reduced to 
accommodate additional funding for HMTF funded activities.
    Question. The Corps uses different metrics to prioritize projects. 
Would it make sense to use the same metric for all parts of the 
country? Would transportation rate savings be a more appropriate metric 
than tons or ton-miles? Should the same metric be used for domestic 
transportation systems and a different metric for import/export 
systems? Should all tons be treated equally or should a domestic ton 
that creates value for Americans on both ends of the trip be treated 
differently from one that imports products while exporting jobs.
    Answer. Harbors and waterways are vital components of the Nation's 
transportation system. The Corps funds many worthwhile maintenance 
needs across the entire spectrum of Corps of Engineers Civil Works 
projects by prioritizing projects based on maximizing benefits. In 
navigation, the focus is on harbors and waterways that have high 
volumes of commerce. Funding is also based on other factors, 
particularly those that serve as critical harbors of refuge, 
subsistence harbors, facilitate U.S. Coast Guard search and rescue 
operations, supply energy needs to communities, and those that play an 
important role in national security and defense. The Corps is 
developing the necessary tools to use a risk-informed, asset management 
based approach to prioritizing funding and to evaluate the Federal 
return on investment. These tools will help in making better funding 
decisions than tons or ton-miles. In the mean time, the approach 
outlined above assists in making the best use of constrained resources 
and provides for commercial goods to reach the market and contribute to 
the economic well being of the Nation.
                                 ______
                                 
             Questions Submitted to Hon. Michael L. Connor
             Questions Submitted by Senator Byron L. Dorgan

                              RURAL WATER

    Question. In prior years I have talked about the drought situation 
in the West particularly as it relates to North Dakota. As we know, 
that is not the situation this year. However, can you talk about the 
drought situation in the West and what we should expect based on 
current models?
    Answer. Without significant snow pack or substantial rainfall, 
current drought conditions are expected to continue. Precipitation 
outlooks are generally unreliable beyond 3 months, and Reclamation 
itself does not forecast weather or drought conditions. Reclamation 
tracks current drought conditions based on information provided by 
other agencies focused on weather, including the National Oceanic and 
Atmospheric Administration's Climate Prediction Center (http://
www.cpc.noaa.gov/), and the Drought Monitor, managed by the National 
Drought Mitigation Center (http://www.drought.unl.edu/dm/monitor.html).
    Reclamation is working, together with other agencies, to promote 
the development of climate science and tools that will allow us to 
evaluate the impacts of climate change on water supplies. Reclamation 
has formed a Federal Climate Change and Western Water Group (CCAWWG) 
dedicated to providing scientific and research collaboration in support 
of Western water management as climate changes.
    Question. There are a number of projects in the fiscal year 2009 
Energy and Water Act that were not included in the President's fiscal 
year 2010 budget request. Can you provide us the capability amounts 
needed for those projects?
    Answer. All rural water projects are included in the President's 
fiscal year 2010 budget request.
    Question. I am happy to see that you have included all of the 
currently funded rural water projects in your budget. Although some are 
funded at very low levels. How did you arrive at the funding decisions 
for these projects?
    Answer. Rural water projects included in the fiscal year 2010 
President's budget request followed the criteria established by 
Reclamation which first provide for the required O&M component and then 
for projects nearest to completion and projects that serve on-
reservation needs.
    Question. How are we ever going to make progress on completing 
these projects, at these low budget levels? Inflation is going to 
increase the project cost faster than the funding we are investing.
    Answer. Reclamation is making significant progress in funding rural 
water projects throughout North and South Dakota and Montana. ARRA 
funds in the amount of $200 million were allocated to rural water 
projects. The Mid-Dakota rural water project was completed in fiscal 
year 2006 and Mni Wiconi is scheduled to be completed by 2013.

                               TITLE XVI

    Question. Title XVI programs are not well supported by the 
administration. Can you explain what the issues are with this program? 
It seems the program would be a good fit with Reclamation's mission of 
bringing water and power to the west.
    Answer. The title XVI Water Reclamation and Reuse Program is an 
important part of Reclamation's mission and is a key element of 
Reclamation's Water Conservation Initiative to address 21st century 
water challenges. Projects funded through the title XVI program enable 
water to be reused, thereby improving efficiency, providing flexibility 
during water shortages, and diversifying the water supply. In addition 
to the fiscal year 2010 request, $135 million of funding under the 
American Recovery and Reinvestment Act of 2009 has been allocated to 
title XVI projects.
    Question. What modifications do you believe could be made to the 
title XVI program that would make it more acceptable to the 
administration?
    Answer. Reclamation recognizes that water reuse is an essential 
tool in stretching limited water supplies in the West. Under the 
President's budget request, the title XVI program will be part of a 
Water Conservation Initiative--along with the Challenge Grant program 
and Basin Study program--to address increasing water demands and 
decreasing water supplies due to extended droughts and climate change. 
Reclamation looks forward to working with the subcommittee to make the 
title XVI program as effective as possible as part of this coordinated 
approach to addressing 21st century water challenges.
    Question. How much of a backlog currently exists in the currently 
authorized title XVI program?
    Answer. There are currently 53 authorized title XVI projects, 
including new projects authorized as a result of the Omnibus Public 
Land Management Act of 2009 (Public Law 111-11).

                          AGING INFRASTRUCTURE

    Question. The recently passed Lands Bill gave Reclamation the 
authority to address rehabilitation of its aging infrastructure. Prior 
to the passage of this legislation this rehabilitation work would have 
been a non Federal responsibility. Recognizing that this is a 
relatively new authority, has Reclamation established guidance for how 
this program is to be implemented?
    Answer. Reclamation is currently developing guidance regarding the 
implementation of this program. Similar programs designed to assist 
Reclamation project beneficiaries in financing the reimbursable costs 
of extraordinary maintenance and rehabilitation work have been 
implemented by Reclamation in the past, and we are drawing on that 
experience in developing implementation guidance.
    Question. Has Reclamation evaluated the condition of this 
infrastructure so that this work could be prioritized in a meaningful 
manner?
    Answer. Reclamation periodically evaluates the condition of its 
facilities through existing review programs. The recommendations 
resulting from the reviews are the basis for prioritization of funding 
for identified needs.
    Question. The language in the lands bill makes this work 
reimbursable over a period not to exceed 50 years. Will this be 
affordable to the non-Federal sponsors that most need this assistance?
    Answer. Current law requires the non-Federal sponsors to pay for 
their allocated portion of this work in advance or repay costs within 
the current year when work is performed. Allowing repayment over a term 
of up to 50 years will greatly ease the burden these entities have 
faced in the past in advancing or repaying the reimbursable costs that 
would be allocated to reimbursable project purposes. Reclamation would 
continue to pay the costs that would be allocated to non-reimbursable 
project purposes. However, given that some of the major repair work 
needed will be very costly, and that interest will be assessed on the 
reimbursable obligations, some project sponsors will still face 
challenges in repaying these costs. It is important to remember that 
non-Federal sponsors, in many cases, are responsible for repaying their 
allocated portions of the capital in addition to operations and 
maintenance costs of the Federal facilities. This law allows more 
flexibility to make payments over time, thereby reducing or minimizing 
long term Federal involvement.
    Question. With much of Reclamation's infrastructure more than 50 
years old, this problem is only going to increase. Has Reclamation 
developed contingencies to address failures of this infrastructure?
    Answer. Assuming that the reference to failures is in the context 
of not being able to continue water deliveries, this would pose a 
public policy question regarding the costs and benefits associated with 
major Federal investment in recapitalizing this infrastructure, as 
addressed in responses to Questions 12 and 13.
    Question. Would a cost shared Federal recapitalization of 
infrastructure that has exceeded its economic life make sense to 
consider?
    Answer. Reclamation believes that the Omnibus Public Land 
Management Act (Public Law 111-11) provides the authority to undertake 
such a program, and plans to consider the appropriateness of funding 
requests to supports these efforts on a project-by-project basis.
    Question. What would be required to establish a program like this 
in Reclamation?
    Answer. In order to establish an effective program to address aging 
infrastructure under the authority of the Omnibus Public Land 
Management Act, Public Law 111-11, Reclamation will need to establish 
procedures for allocating costs among reimbursable and non-reimbursable 
project purposes, set standards for appropriate repayments terms within 
the prescribed limits, and prioritize the use of available funds among 
its many aging facilities.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray

                      ODESSA SUBAREA SPECIAL STUDY

    Question. Commissioner Connor, I am disappointed that the Odessa 
Subarea Special Study, which was included in the fiscal year 2009 
President's budget request, has been eliminated in the fiscal year 2010 
President's budget request. As you know, the Columbia Basin Project is 
a critical tool for farmers in my home State of Washington. Securing a 
reliable surface water supply for the producers is important to 
ensuring the continuation of agriculture in Central Washington while 
protecting our groundwater supplies. Can you tell me why this project 
was eliminated in the President's budget request?
    Answer. Reclamation recognizes the importance of Columbia Basin 
water issues; however, faced with significant competing demands for 
aging infrastructure, satisfying Endangered Species Act regulatory 
requirements on operating projects, and other high priority water 
issues throughout the 17 Western States, no funding was included in the 
fiscal year 2010 President's budget. Reclamation also understands the 
importance, specifically, of the Odessa Subarea Special Study (Study). 
Reclamation has partnered with the State of Washington (State) to 
investigate the possibility of continuing development of the Columbia 
Basin Project to deliver project surface water to lands currently using 
ground water in the Odessa Subarea. Reclamation will continue to work 
with the State to bring the Study to completion as soon as possible. 
The State has identified the declining Odessa Subarea aquifer as the 
highest priority issue to address in the Columbia River Basin. The 
State will continue to fund the study in fiscal year 2010 and fiscal 
year 2011.
    Question. It is my understanding that the environmental impact 
statement analysis of the alternatives identified in the appraisal-
level investigation is underway, and the State of Washington and the 
Bureau are working together to complete this work. When do you 
anticipate completion of the feasibility study? Are you still on track 
for completion in 2011?
    Answer. Reclamation anticipates that the study may need to be 
extended. Reclamation and the State of Washington Department of Ecology 
(Ecology) are jointly preparing an environmental impact statement (EIS) 
to meet the National Environmental Policy Act and State Environmental 
Policy Act requirements. The draft EIS is currently scheduled for 
release to the public in spring 2010, with the final EIS scheduled for 
spring 2011.
    Question. Now that the appraisal-level investigation has been 
completed and the path forward has become more clear, an increase in 
the annual funding level will be needed to make sure the study is 
completed in a timely fashion. Unlike this year, can we expect to see 
future requests from the Bureau to reflect this?
    Answer. There will be a continued level of commitment from 
Reclamation to complete the study in fiscal year 2011. The State has 
indicated a continued level of commitment in 2010 and 2011.

                 WASHINGTON STATE ARRA FUNDED PROJECTS

    Question. Commissioner Connor, as you know, my State has many ready 
to go construction projects within the Bureau's purview, and as such 
was a beneficiary of Recovery Act funding, which I am thrilled about. 
Can you please provide an update on these projects?
    Answer. We too are pleased that so many worthy projects in the 
State of Washington received Recovery Act funding. The following is an 
update of those projects:
    The following contracts and work have been awarded:
  --Leavenworth National Fish Hatchery Complex--an Indefinite Delivery/
        Indefinite Quantity (IDIQ) task order was awarded for the 
        design of a water supply replacement system for the intake 
        facility. Amount $780,000.
  --Leavenworth National Fish Hatchery Complex--IDIQ task order was 
        awarded for survey work for the repair of the adult holding 
        pond. Amount $33,000.
  --Columbia/Snake River Habitat Projects hired a three-person crew to 
        work on the Methow Habitat Project Evaluation to meet 
        monitoring requirements. Amount $130,000.
    The following contracts are out for solicitation:
  --Roza Roller Gates solicitation was issued with an estimated award 
        of early October 2009 and construction projected to begin late 
        October 2009. Estimated cost $4.9 million.
  --Weber Siphon Complex solicitation was issued with an estimated 
        award of late September 2009 and construction projected to 
        begin late October 2009. Estimated cost is $49 million.
  --Potholes Supplemental Feed Route--Pinto Dam and Brooks Lake 
        solicitation was issued with an estimated award of mid-
        September 2009 and construction projected to begin mid-October 
        2009. Estimated cost is $3.1 million.
  --Grand Coulee Maintenance items have been advertised for bid on E-
        BUY with an estimated award date of mid-August 2009. Estimated 
        amount is $890,000.
    The following items are either in the review stage or being 
prepared:
  --Remaining Grand Coulee Maintenance items being reviewed for ARRA 
        compliance requirements in our Denver office.
  --Umatilla Project--Modifications and improvements on water delivery 
        system being reviewed for ARRA compliance requirements in our 
        Denver office.
  --Sunnyside Division Board of Control--the financial assistance 
        agreement to the Sunnyside Board of Control for piping three 
        large laterals is expected to be signed in mid-September.
  --Columbia/Snake River Habitat Projects--the financial assistance 
        agreement to the Methow Salmon Recovery Foundation for two fish 
        habitat improvement projects is expected be signed in early 
        September.
    Question. As you know, the Bureau owns billions of dollars worth of 
irrigation infrastructure all across the West, and the infrastructure 
is aging and in need of significant investment to maintain efficient 
operation. We have authorized and directed the Bureau to develop a 
Federal loan guarantee program to assist operators of Reclamation 
projects in securing low interest loans to encourage investment in 
Federal infrastructure.
    Can you please tell me the status of this program?
    Answer. This program has not yet been implemented. A proposed rule 
for the program has been published and comments were received. We will 
continue to keep Congress informed about the status of the program.
    Question. Do you think that this program is successful in 
encouraging local project operators to make these kinds of investments 
in our Federal facilities?
    Answer. The program has not been implemented, but we will continue 
to keep Congress informed about its status.
    Question. Are there other ways to encourage this investment?
    Answer. Section 9603 of the Omnibus Public Land Management Act of 
2009 (Public Law 111-11) was enacted to assist Reclamation project 
beneficiaries in paying for extraordinary operation and maintenance 
costs. Public Law 111-11 allows repayment of extraordinary O&M costs 
allocated to the authorized reimbursable purposes of the project within 
50 years, with interest.
                                 ______
                                 
            Questions Submitted by Senator Robert F. Bennett

                             QUAGGA MUSSELS

    Question. Quagga Mussels are becoming more of a problem in western 
waters and are affecting Reclamation projects. How much funding is 
included in Reclamation's budget to address the control of Quagga 
Mussels?
    Answer. In fiscal year 2009, Reclamation-wide appropriated funding 
for addressing the control of invasive mussels (both Quaqqa and Zebra 
mussels) includes just over $2.0 million. This funding encompasses 
activities related to the prevention of spread, early detection and 
rapid response for new infestations, control and management, research, 
and outreach and education. The fiscal year 2010 appropriated budget 
request totals nearly $3.5 million. In addition to appropriated 
funding, there are also direct or contributed funds and in-kind 
services to be provided by various partners and customers estimated to 
be nearly $375,000 and $475,000 in fiscal year 2009 and fiscal year 
2010, respectively. Reclamation also received $4.5 million in ARRA 
funding for monthly testing of 60 Reclamation reservoirs for presence 
of mussel larvae. This activity will continue through 2010.
    Question. What are the costs to Reclamation to deal with Quagga 
Mussels at Reclamation projects?
    Answer. Reclamation is continually working with its regional and 
area offices to consolidate invasive mussel related cost information. 
Appropriated Reclamation funding expenditures in fiscal year 2008 and 
fiscal year 2009 are estimated to total approximately $3.5 million and 
reflect Reclamation-wide costs to deal with invasive mussels to date. 
Future costs are expected to escalate as invasive mussels continue to 
spread throughout Reclamation in the 17 Western States.
    Question. Does Reclamation have a research and development program 
to study Quagga Mussels?
    Answer. Reclamation's Research and Development (R&D) Office has 
made invasive mussels a top priority. Zebra and Quagga mussel research 
under Reclamation's Science and Technology Program was started in 2008 
to address both existing and anticipated mussel impacts at Reclamation 
facilities throughout the Western United States. The emphasis is on 
monitoring, early detection, control, and mitigation to maintain 
Reclamation's water and hydropower operations. The goal is broad 
application of promising facilities protection technologies and 
strategies. Specific investigations seek to improve early detection 
methods, infrastructure coatings to prevent mussel settlement, mussel 
resistant fish screens, use of filters and Ultraviolet (UV) light 
systems, development of a bacterial product (Pseudomonas fluorescens) 
to kill mussels, control using natural predators, addressing post-
infestation rapid die-off impacts, and assessing mussel impacts in 
river and reservoir environments.
    Question. How much funding has Reclamation included in the fiscal 
year 2010 budget to study these invasive species?
    Answer. Reclamation's fiscal year 2010 R&D Office budget request 
includes $1.49 million for invasive mussel research.

                 DESALINATION RESEARCH AND DEVELOPMENT

    Question. What research and development plans does Reclamation have 
for the Brackish Groundwater National Desalination Research Facility?
    Answer. In general, the work at this facility will focus on 
improvement and testing of technologies for the treatment of inland 
brackish groundwater and disposal of concentrate, with special emphasis 
on the use of renewable energy to drive such processes.
    Research funds for the Brackish Groundwater National Desalination 
Research Facility (BGNDRF), appropriated to Reclamation under the 
Desalination Act of 1979, were earmarked to New Mexico State University 
in fiscal year 2008 ($3.365 million) and fiscal year 2009 ($2.0 
million). For fiscal year 2010, we requested $1.6 million for O&M of 
the BGNDRF, and $2.133 million for research on advanced water treatment 
technologies, some of which will occur at the facility.
    Research to date at BGNDRF has included work with Sandia National 
Laboratories and a private sector company looking at an innovative 
concentrate disposal method and testing of new membranes developed by a 
university through an Office of Naval Research grant. Also underway is 
concentrate disposal testing by Veolia Water and electro-dialysis 
testing with New Mexico State University and General Electric. Other 
projects are in the discussion stages.
    The facility will provide all the requirements for researchers 
working with desalination systems, concentrate management issues, 
renewable energy/desalination hybrids, and rural systems.
    Question. Will the funding budgeted allow for meaningful research 
at the facility?
    Answer. Historically, Reclamation has ensured that research 
appropriations produce the highest quality products by defining the 
research objectives to address the highest-priority questions, and 
funding research through an open, competitive, peer reviewed process. 
These have been the administration's standards for research 
administration.
    This approach will be used to administer research at the BGNDRF 
facility for those appropriations that Reclamation controls. The 
amounts requested in the President's 2010 budget are sufficient to 
undertake important work advancing the treatment of brackish 
groundwaters.
    Reclamation's ability to ensure meaningful research is limited to 
the extent that the funds appropriated for this research are earmarked 
without an open, competitive process.
    Question. What other advanced water treatment options are showing 
promise for impaired groundwater?
    Answer. Many technologies exist to treat a range of brackish 
waters. Reclamation focuses its research on technologies that may 
represent a significant breakthrough in either cost reduction or 
effectiveness of treatment. Currently, two of the most promising 
technologies that Reclamation is developing are: (1) a truly chlorine-
resistant thin-film composite reverse osmosis membrane that will allow 
pre-treatment with chlorine to prevent bio-fouling without the 
degradation of the membrane, and (2) a more efficient cellulose-
triacetate membrane that is naturally chlorine resistant. Both 
technologies will likely be tested at the BGNDRF.
    Reclamation is also working with other Government agencies, 
universities, non-profits, and the private sector. Not only are there 
new membrane formulations being created and tested by Reclamation and 
others, innovative work is continuing on the development of cost 
effective concentrate disposal, reduced energy consumption/lower 
CO2 footprint/renewables, reduced fouling, and alternative 
desalination technologies such as forward osmosis, membrane 
distillation, electro-dialysis, thermal technologies and others.
    Question. Do you see any potential for Reclamation becoming 
involved in the construction of desalination plants? Why?
    Answer. Historically, Reclamation has focused upon research and 
development of advanced water treatment technologies up through pilot 
scale testing and demonstration, and moving those technological 
advances to the private sector for commercialization. Given the very 
large global industry around design and construction of desalination 
plants, there does not appear to be a need for Reclamation to enter 
into this domain. However, Reclamation may be able to play a role in 
providing designs or reviewing designs for systems that are not a focus 
of the mainstream design and construction industry, for example for 
small-scale plants that are part of a Reclamation Rural Water project, 
or applications on Indian lands, or applications that are otherwise 
integrated with Reclamation projects.
    Question. You have only budgeted about $500,000 for drought 
assistance in fiscal year 2010. Is that funding sufficient to address 
the drought issues that are anticipated next year?
    Answer. Reclamation prepares its budgets 2 years in advance. 
Consequently, we are unable to forecast this kind of emergency. 
However, we make every effort to address the greatest need with the 
funds available and to put our efforts into funding on-the-ground 
activities.
    The amount requested for Drought Program funding in fiscal year 
2010 is primarily the result of a relatively flat overall budget for 
Reclamation and increasing costs associated with site security, dam 
safety, project rehabilitation, and operation and maintenance, to name 
just a few. Reclamation has many important programs that need to be 
funded, and has made its best effort to develop a budget that 
adequately balances the competing needs for these different programs.
    In addition to the $500,000 requested for drought assistance in 
fiscal year 2010, Reclamation recently announced $40 million in funding 
available under the American Recovery and Reinvestment Act (ARRA) of 
2009 to projects that will address the impacts of drought in 
California. The $40 million in ARRA funding will be used to fund 
drought projects beginning this summer and continuing throughout 2010.
    In addition to our Drought Program, Reclamation also addresses 
competing demands for finite water supplies through the Water 
Conservation Initiative. Reclamation has requested $46 million for the 
Water Conservation Initiative in 2010, which includes funding for the 
title XVI, Challenge Grant, and Basin Study Programs.
    Question. In the fiscal year 2010 budget, the rural Water Program 
authorized in 2006 appears to be finally getting out of the evaluation 
and rule making phase into actually starting to address the water needs 
in western States. Can you update us on the status of this program?
    Answer. The Rural Water Supply Act required that the Department of 
the Interior develop programmatic criteria for the new program and 
publish them in the Federal Register through a rulemaking process. In 
November 2008, the Department published an interim final rule (Rule) 
establishing comprehensive programmatic criteria governing eligibility, 
the prioritization of projects for funding, and the evaluation of 
studies completed under the program. The Rule became effective on an 
interim basis on December 17, 2008, and the 60-day public comment 
period ended on January 16, 2009. The Rule will be implemented upon 
completion of a set of guidelines or internal directives (``Directives 
and Standards'') describing how the program will be implemented by 
Reclamation. The Directives and Standards will describe key aspects of 
program implementation, such as how Reclamation will receive and review 
applications, how Reclamation will review completed studies, and will 
specify the required content of appraisal and feasibility studies 
completed or reviewed under the program. By establishing uniform 
requirements for program implementation, the Directives and Standards 
will help ensure that the program is implemented consistently, 
effectively and transparently across the organization.
                                 ______
                                 
                   Questions Submitted to Reed Murray
            Questions Submitted by Senator Robert F. Bennett

    Question. Mr. Reed, The budget for CUPCA is flat when compared to 
fiscal year 2009. Is this funding level sufficient to continue to make 
progress on this critical project?
    Answer. The President's 2010 budget for CUPCA is sufficient to 
continue CUP construction and implementation of CUP mitigation and 
conservation activities.
    Question. What is your total funding capability for CUPCA in fiscal 
year 2010?
    Answer. The President's 2010 budget for CUPCA represents the 
funding capability of the CUPCA program.
    Question. What will this additional capability accomplish?
    Answer. Since the President's 2010 budget represents the CUPCA 
programs funding capability the CUPCA budget justification documents 
adequately describe the proposed 2010 accomplishments.

                          SUBCOMMITTEE RECESS

    Senator Dorgan. This hearing is recessed.
    [Whereupon, at 11:50 a.m., Thursday June 18, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]


    ENERGY AND WATER DEVELOPMENT APPROPRIATIONS FOR FISCAL YEAR 2010

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

                       NONDEPARTMENTAL WITNESSES

    [Clerk's note.--At the direction of the subcommittee 
chairman, the following statements received by the subcommittee 
are made part of the hearing record on the Fiscal Year 2010 
Energy and Water Development Appropriations Act.]

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

         Prepared Statement of the Red River Valley Association
    Mr. Chairman and members of the subcommittee, I am Wayne Dowd, 
President, and pleased to represent the Red River Valley Association, 
629 Spring St., Shreveport, Louisiana. Our organization was founded in 
1925 with the express purpose of uniting the citizens of Arkansas, 
Louisiana, Oklahoma and Texas to develop the land and water resources 
of the Red River Basin.
    The Resolutions contained herein were adopted by the Association 
during its 84th Annual Meeting in Shreveport, Louisiana, on February 
19, 2009, and represent the combined concerns of the citizens of the 
Red River Basin area as they pertain to the goals of the Association. A 
summary of the civil works projects and requested funding is included 
in this testimony.
    The President's fiscal year 2010 budget included $5.1 billion for 
the civil works programs. It is $350 million more than proposed in 
fiscal year 2009 and $300 million less than what Congress enacted in 
the fiscal year 2009 Omnibus bill, $5.4 billion. The problem is also 
how the administration distributes funds. A few projects received the 
full ``Corps Capability'' to the detriment of many projects that 
receive no funding. Even though this is one of the largest 
administrative budgets, the $5.1 billion level does not come close to 
the real needs of our Nation. A more realistic funding level to meet 
the existing needs of the civil works program is $8 billion for fiscal 
year 2010. The traditional civil works programs remain at the low, 
unacceptable level as in past years. These projects are the backbone to 
our Nation's infrastructure for waterways, flood prevention, water 
supply and ecosystem restoration. We remind you that civil works 
projects are a true ``jobs program'' in that up to 85 percent of 
project funding is contracted to the private sector; 100 percent of the 
construction, as well as much of the architect and engineering work. 
Not only do these projects provide jobs, but provide economic 
development opportunities for our communities to grow and prosper, 
creating permanent jobs.
    We want to point out that we appreciate the funding Congress 
enacted in the fiscal year 2009 Omnibus Bill; however, it is $200 
million less than appropriated in fiscal year 2008. We encourage 
Congress to increase the ``water'' share of the total Energy and Water 
bill closer to 20 percent to reach the $8 billion capability.
    Another proposal allocates O&M funding by watershed regions and 
eliminates funding by individual project. We do not accept this concept 
since you will loose ownership and identity of each project; therefore, 
lose grass root support. If this was done, due to reprogramming 
constraints, then reprogramming should be addressed. Major 
reprogramming issues are with CG projects, not with O&M projects. Fund 
O&M by project, not watershed basins.
    We have great concerns over the issue of ``earmarks''. Civil Works 
projects are not earmarks! Civil Works projects go through a process; 
reconnaissance study, feasibility study, benefit to cost ratio test, 
EIS, peer review, review by agencies, public review and comment, final 
Chief of Engineer approval, authorization by all of Congress in a WRDA 
bill and signed by the President. WRDA 2007 added an independent review 
of major projects. No other Federal program goes through such a 
rigorous approval process. Each justified project ``stands alone'', are 
proven to be of national interest and should be funded by project. For 
most projects there is local sponsor cost sharing during the 
feasibility study, construction and for O&M. Those who have 
contributed, in most cases--millions of dollars--to the process, must 
have the ability to have a say for their projects to get funded. That 
voice is through their Congressional delegation. We believe that 
earmarks are not in the national interest, but it does not pertain to 
the civil works program. For civil works it is an issue of priority of 
projects to be funded and who will determine that, OMB or Congress! We 
hope Congress keeps their responsibility to set civil works priorities 
and to determine how its citizen's tax dollars are spent.
    The President's budget proposes eliminating the current fuel tax to 
fund the Inland Waterways Trust Fund (IWTF) and replace it with a barge 
lock-use fee. This change creates an unfair tax to industries on 
waterways with locks versus waterways without locks. The needs of the 
IWTF should be analyzed and determine what increase to the existing 
fuel tax would maintain the necessary income flow to keep projects 
funded from the Inland Water Trust Fund. The lockage fee proposal is 
unfair to tributary waterways with locks and we request it not be 
implemented.
    I would now like to comment on some of our specific requests for 
the future economic well being of the citizens residing in the four 
State Red River Basin regions. It is noted that at the time for 
testimony submission the details of the President's fiscal year 2010 
budget have yet to be released.
    Navigation.--The J. Bennett Johnston Waterway is living up to the 
expectations of the benefits projected. We are extremely proud of our 
public ports, municipalities and State agencies that have created this 
success. This upward ``trend'' in usage will continue as new industries 
commence operations. A major power company, CLECO, is investing $1 
billion in its Rodemacher Plant near Boyce, Louisiana, on the lower Red 
River and has started moving over 3 million tons of ``petroleum coke'' 
and limestone, by barge, in the 4th quarter 2008. These projects are a 
reality and there are many more industries considering using our 
Waterway.
    You are reminded that the Waterway is not complete, 6 percent 
remains to be constructed, $121 million. We appreciate Congress' 
appropriation level in fiscal year 2009 of $7,656,000. There is a 
capability for $21 million of work, but we realistically request $12 
million to keep the project moving toward completion, ``J. Bennett 
Johnston Waterway (CG)''.
    Now that the J. Bennett Johnston Waterway is reliable year round we 
must address efficiency. Presently a 9-foot draft is authorized for the 
J. Bennett Johnston Waterway. All waterways below Cairo, Illinois are 
authorized at 12-foot, to include the Mississippi River, Atchafalaya 
River, Arkansas River and Gulf Intracoastal Waterway. A 12-foot channel 
would allow an additional one-third capacity, per barge, which will 
greatly increase the efficiency of our Waterway and further reduce 
transportation rates. This one action would have the greatest, positive 
impact to reduce rates and increase competition, bringing more 
industries to use waterborne transportation. We request a 1-year 
reconnaissance study be funded to evaluate this proposal, at a cost of 
$100,000. Fact: Approximately 95 percent is already at 12-foot year 
round.
    The feasibility study to continue navigation from Shreveport-
Bossier City, Louisiana, into the State of Arkansas will be completed 
in CY 2010. This region of SW Arkansas and NE Texas continues to suffer 
major unemployment and this navigation project, although not the total 
solution, will help revitalize the economy. Due to the time lapsed in 
the study the ``freight rates'' calculated a number of years ago they 
must be re-evaluated this year. We request funding of $100,000 to 
conduct the re-evaluation of freight rates, ``Navigation into SW 
Arkansas''.
    Flood Prevention.--What will happen when we ignore our levee 
systems? We know the Red River levees in Arkansas do not meet Federal 
standards, which is why we have the authorized project, ``Red River 
Below Denison Dam, TX, AR & LA''. Now is the time to bring these levees 
up to standards, before a major flood event, which will occur.
    We continue to consider flood control a major objective and request 
you continue funding the levee rehabilitation projects ongoing in 
Arkansas. Five of 11 levee sections have been completed and brought to 
Federal standards.
    The levees in Louisiana have been incorporated into the Federal 
system; however, they do not meet current safety standards. These 
levees do not have a gravel surface roadway, threatening their 
integrity during times of flooding. It is essential for personnel to 
traverse the levees during a flood to inspect them for problems. 
Without the gravel surface the vehicles will cause rutting, which can 
create conditions for the levees to fail. A gravel surface will insure 
inspection personnel can check the levees during the saturated 
conditions of a flood.
    Appropriations of $15 million will construct one more levee section 
in Lafayette County, AR and continue the rock surfacing of levees in 
Louisiana, ``Red River Below Denison Dam, AR & LA''.
    Bank Stabilization.--One of the most important, continuing 
programs, on the Red River is bank stabilization in Arkansas and North 
Louisiana. We must stop the loss of valuable farmland that erodes down 
the river and interferes with the navigation channel. In addition to 
the loss of farmland is the threat to public utilities such as roads, 
electric power lines and bridges; as well as increased dredging cost in 
the navigable waterway in Louisiana. These bank stabilization projects 
are compatible with subsequent navigation into Arkansas and we urge 
that they be continued in those locations designated by the Corps of 
Engineers to be the areas of highest priority. We appreciated the 
Congressional funding in past fiscal years and request you fund this 
project at a level of $11 million in fiscal year 2010, ``Red River 
Emergency Bank Protection''.
    Water Quality.--The Assistant Secretary of the Army (Civil Works), 
in October 1998, agreed to support a re-evaluation of the Wichita River 
Basin tributary of the project. The re-evaluation report was completed 
and the Director of Civil Works signed the Environmental Record of 
Decision. The plan was found to be economically justified. Then the ASA 
(CW) directed that construction would not proceed until a local sponsor 
was found to assume 100 percent of the O&M for the project. The 2007 
WRDA bill included language that clarified that all aspects of this 
project will be at full Federal expense, to include O&M.
    Over the past years there has been a renewed interest by the 
Lugart-Altus Irrigation District to evaluate construction of Area VI, 
of the Chloride Control Project, in Oklahoma. They have obtained the 
support of many State and Federal legislators, as well as a letter from 
the Oklahoma Governor in support of a re-evaluation report.
    Total request for the ``Chloride Control Project'': $9,000,000 for 
the Texas and Oklahoma areas.
    Water Supply.--Lake Kemp, just west of Wichita Falls, TX, is a 
major water supply for the needs of this region. Due to siltation the 
available storage of water has been impacted. A reallocation study is 
needed to determine water distribution needs and raising the 
conservation pool. Total O&M of $664,000 is requested for fiscal year 
2010 ($214,000 is required for the base annual O&M, $300,000 for the 
study and $150,000 for service bridge and gate repair).
    A water re-allocation study has been completed for Lake Texoma. It 
will provide for an additional 600,000 acre-feet for municipal use. The 
release of the study has been delayed at the Corps HQ for over a year. 
Congress needs to request that this re-allocation study be approved and 
released.
    Studies.--We have a number of General Investigation (GI) studies 
that have been funded and have local sponsors prepared to cost share 
feasibility studies. Some of those important studies include: Bossier 
Parish Flood Control Study, LA--$350,000; Cross Lake Water Supply 
Study, LA--$100,000; SE Oklahoma Water Resource Study, OK--$500,000; SW 
Arkansas Study, AR--$100,000; Washita River Basin, OK--$500,000 and 
Wichita River Basin, TX--$100,000. These studies are important to have 
projects ready for future construction.
    Operation & Maintenance.--Full O&M capability levels are not only 
important for our Waterway project but for all our Corps projects and 
flood control lakes. The backlog of critical maintenance only becomes 
worse and more expensive with time. The ``2007 Summer Flood of Record'' 
was devastating to the recreation industry at Lake Texoma, on the main 
stem Red River, as well as a number of other Oklahoma lakes. We urge 
you to appropriate funding to address this serious issue, either 
through an emergency supplemental or the appropriation bill. We request 
that the Corps O&M projects be funded at the expressed, full Corps 
capability.
    American Recovery and Reinvestment Act of 2009.--The original 
administrative submission did not include civil works funding. We want 
to thank Congress for including $4.6 billion in the ``stimulus'' 
package for civil works projects, especially in the O&M account. These 
additional funds will be important to address our long list of backlog 
needs.
    Thank you for the opportunity to present this testimony and project 
details of the Red River Valley Association on behalf of the 
industries, organizations, municipalities and citizens we represent 
throughout the four State Red River Valley region. The Civil Works 
program directly relates to national security by investing in economic 
infrastructure. If waterways are closed companies will not relocate to 
other parts of the country--they will move over seas. If we do not 
invest now there will be a negative impact on our ability to compete in 
the world market threatening our national security.

                  RED RIVER VALLEY ASSOCIATION FISCAL YEAR 2010 APPROPRIATIONS--CIVIL WORKS \1\
                                             [Dollars in thousands]
----------------------------------------------------------------------------------------------------------------
                                           Fiscal Year     RRVA Fiscal      President
                                           2009 Approp      Year 2010      Fiscal Year        Local Sponsor
                                             Omnibus         Request      2010  Budget         Requirements
----------------------------------------------------------------------------------------------------------------
Studies (GI):
    Navigation into SW Arkansas:         ..............            $100  ..............  (ARRC)
     Feasibility.
    Red River Waterway, LA-12' Channel,  ..............             100  ..............  (RRWC)
      Recon.
    Bossier Parish, LA.................            $191             350  ..............  (Bossier Levee)
    Cross Lake, LA Water Supply                     229             100  ..............  (Shreveport)
     Supplement.
    SE Oklahoma Water Resource Study:               311             500  ..............  (OWRB)
     Feasibili-  ty.
    SW Arkansas Ecosystem Restoration:              143             184  ..............  (?)
     Recon Study.
    Cypress Valley Watershed, TX.......  ..............             100  ..............  (?)
    Sulphur River Basin, TX............  ..............           1,000  ..............  (Sulphur Auth)
    Washita River Basin, OK............             191             500  ..............  (L)
    Wichita River Basin above Lake       ..............             100  ..............  (L)
     Kemp, TX: Recon.
    Red River Above Denison Dam, TX &    ..............             100  ..............  (L)
     OK:  Recon.
    Red River Waterway, Index, AR to     ..............              44  ..............  (?)
     Denison  Dam.
    Mountain Fork River Watershed, OK &  ..............  ..............  ..............  (?)
     AR, Recon.
    Walnut Bayou, Little River, AR.....  ..............             100  ..............  (ANRC)
    Red River Waterway, Index to         ..............  ..............  ..............  (?)
     Denison, Bendway Weir.
Construction General (CG):
    Red River Waterway: J.B. Johnston             7,656          21,000  ..............  (RRWC)
     Waterway, LA.
    Chloride Control Project, TX & OK..           2,201           9,000  ..............  N/A
    Red River Below Denison Dam; AR &             2,105          11,000  ..............  (Levee Districts)
     LA.
        Bowie County Levee, TX.........  ..............  ..............  ..............  (Levee Districts)
    Red River Emergency Bank Protection           2,817          15,000  ..............  (Levee Districts)
    Big Cypress Valley Watershed, TX:    ..............           1,450  ..............  (Jefferson)
     section 1135.
    Palo Duro Creek, Canyon, TX:         ..............             100  ..............  (Canyon, TX)
     section 205.
    Millwood, Grassy Lake, AR: section          ( \2\ )             350  ..............  (?)
     1135.
    Little River County/Ogden Levee,     ..............             300  ..............  (ASWC)
     AR, PED.
    McKinney Bayou, AR, PED............  ..............  ..............  ..............  .......................
    Miller County Levee, AR, section     ..............  ..............  ..............  (Miller Levee)
     1135.
Operation and Maintenance (O&M):
    J. Bennett Johnston Waterway, LA...           9,797          16,230  ..............  .......................
    Lake Kemp, TX--Total Need..........             198             664  ..............  .......................
        Basic Annual O&M...............  ..............             214  ..............  .......................
        Reallocation Study.............  ..............             300  ..............  .......................
        Service Bridge & Gate Repair...  ..............             150  ..............  .......................
    Lake Texoma, TX & OK--Total Need...           6,164           9,393  ..............  .......................
        Basic Annual O&M...............  ..............           6,393  ..............  .......................
        Suppl. EIS.....................  ..............           1,000  ..............  .......................
        Backlog Maintenance............  ..............           2,000  ..............  .......................
    Chloride Control Project, TX & OK..           1,348           5,824  ..............  .......................
----------------------------------------------------------------------------------------------------------------
\1\ Depending on final Stimulus funding RRVA fiscal year 2010 requests may change. Details of the President's
  fiscal year 2010 budget have NOT yet been released.
\2\ YES.

NOTE: Local Sponsor Column--Sponsor indicated in ( ); (?) indicates No Sponsor identified and need one to
  continue (L) indicates Sponsor not required now but need one for feasibility; N/A--No Sponsor required.

                                 ______
                                 
              Prepared Statement of The Nature Conservancy

    Mr. Chairman and the members of the subcommittee, thank you for the 
opportunity to present The Nature Conservancy's recommendations for 
fiscal year 2010 appropriations for the U.S. Army Corps of Engineers 
(Corps) and Bureau of Reclamation.
    The Nature Conservancy's recommendations represent a priority set 
of efforts that are both individually important and collectively 
designed to demonstrate innovations in restoration to help guide future 
resource allocation. Further, if done well, ecosystem restoration 
projects pay dividends through services such as provision of more 
reliable and higher quality water, natural flood attenuation, 
sustaining commercial fisheries, and supporting economically-important 
outdoor recreation. Moreover, the Nation's resiliency to climate change 
will be substantially dictated by the health of our ecosystems. In 
short, we believe the public investments we are requesting now will pay 
far larger dividends for decades to come.

                     CORPS CONSTRUCTION PRIORITIES

    Continuing Authorities Program.--We thank the subcommittee for 
continuing its strong support of the section 1135: Project 
Modifications for Improvement of the Environment and section 206: 
Aquatic Ecosystem Restoration programs. However, demand for these 
programs continues to outstrip funding. The Conservancy requests that 
the programs be fully funded by appropriating $40 million for section 
1135 and $50 million for section 206.
    The Conservancy seeks funding for two section 1135 projects. The 
Spunky Bottoms project (IL) is a model floodplain restoration and 
reconnection effort on the Illinois River that needs $400,000 to 
complete a feasibility study in fiscal year 2010; the Conservancy is 
the non-Federal cost share partner. Additional dollars will be 
necessary for the planning, specifications, construction and monitoring 
phases, totaling approximately $7.5 million. The Chain Bridge Flats 
project (D.C.) needs $100,000 to complete a reconnaissance report to 
restore a globally rare habitat along the Potomac River.
    The Conservancy also seeks funding for three section 206 projects: 
Emiquon Preserve (IL), a floodplain restoration and reconnection 
project that needs $600,000 to complete a feasibility study, sign a 
project partnership agreement, and begin design; Camp Creek (OR), a 
headwaters stream restoration project that needs $575,000 to sign a PCA 
and complete construction; and Navajo Reservation Implementation (NM), 
which needs $510,000 for restoration on the San Juan River. The 
Conservancy is the cost share partner for Emiquon and Camp Creek.
    We continue to be concerned about the subcommittee's guidance for 
these programs. The prioritization requirements and ``no new starts'' 
rule in the fiscal year 2009 report block the implementation of 
important conservation priorities that enjoy strong support from their 
local communities. We urge the subcommittee to adopt a more flexible 
approach. Appropriating the requested amounts will help address the 
backlog in these programs, as will funds from the American Recovery and 
Reinvestment Act.
    Estuary Restoration Program.--The Estuary Restoration Program is a 
national, multi-level, multi-agency strategy to restore our Nation's 
estuaries that benefits fish, shellfish and wildlife; improves surface 
and groundwater resources; provides flood control; and enhances 
recreational opportunities. The Conservancy supports $10 million for 
the Estuary Restoration Program in fiscal year 2010.
    Upper Mississippi River Navigation and Ecosystem Sustainability 
Program.--The Navigation and Ecosystem Sustainability Program (NESP) is 
a dual purpose authority for integrated management of the Upper 
Mississippi River (UMR) system's habitat and navigation facilities. All 
activities implemented under the existing Environmental Management 
Program (EMP) can be transitioned into NESP, but it is critical to fund 
both programs until the transition is complete. While the Corps has the 
capability to execute a $50 million budget for NESP in fiscal year 2010 
for ecosystem restoration and navigation projects, and we support this 
funding level, we also recognize the current budgetary constraints and 
acknowledge that a more realistic NESP fiscal year 2010 new start 
request should be $35 million. The Conservancy also supports $33.2 
million for EMP in fiscal year 2010.
    Missouri River Fish and Wildlife Recovery Program (MRRP).--Under 
this program, the Corps has completed 30 projects in the lower Missouri 
basin States to assist in the recovery of three listed species, 
restoring more than 40,000 acres of habitat. New authority was provided 
in WRDA 2007 for the expenditure of funds in the upper basin States and 
for the Intake Dam project on the Yellowstone River in Montana. 
Construction of fish passage and screens at Intake Dam is a priority 
for the recovery of the endangered pallid sturgeon and other warm-water 
fish. The Conservancy supports $85 million for the MRRP in fiscal year 
2010, including sufficient funding to continue progress on the design 
and construction of fish passage and screens at Intake Dam.
    South Florida Everglades Ecosystem Restoration Program.--Corps 
flood control projects, coupled with agricultural and urban 
development, have degraded one of the most diverse and ecologically 
rich wetlands ecosystems in the world. WRDA 2007 authorized 
construction of the first projects under the Comprehensive Everglades 
Restoration Plan (CERP). We place priority on funding the restoration 
of the Kissimmee River, a project that is almost 75 percent complete 
and already a restoration success story. The Conservancy requests $300 
million for the South Florida Ecosystem Restoration Program in fiscal 
year 2010.
    Puget Sound and Adjacent Waters.--The Puget Sound and Adjacent 
Waters Program provides funding for early action projects to restore 
Puget Sound and its watershed. The Conservancy requests $3.5 million 
for Puget Sound and Adjacent Waters in fiscal year 2010. Identification 
of these early action projects is informed by the Puget Sound Nearshore 
Ecosystem Restoration project (in the Investigations account), for 
which the Conservancy requests $1.5 million in fiscal year 2010.
    Hamilton City Flood Damage Reduction and Ecosystem Restoration.--
This project will increase flood protection for Hamilton City, CA and 
surrounding agricultural lands and restore approximately 1,500 acres of 
riparian habitat. The PED phase for this project will be complete in 
fiscal year 2009, the non-Federal sponsor is in place and the project 
received construction authorization in WRDA 2007. The Conservancy 
supports $15 million in fiscal year 2010 to complete the first phase of 
construction.
    Chesapeake Bay Oyster Recovery.--Eastern oyster populations in the 
Chesapeake Bay have been decimated from historical levels by a century 
of overfishing, disease and pollution. This project will help move the 
oyster population towards sustainable levels. The requested 
appropriation will create more than 60 acres of additional oyster 
habitat. The Conservancy supports $4 million in fiscal year 2010 for 
this program.

                       SUSTAINABLE RIVERS PROJECT

    The Sustainable Rivers Project (SRP) is an initiative launched by 
the Corps that recognizes the urgent need to update decades-old water 
management practices to meet society's needs today and in the coming 
decades. The SRP is developing and demonstrating innovative approaches 
to reservoir operations that restore critical ecosystems and valuable 
ecosystem services, while continuing to provide for (and often 
improving) water supply and flood risk management. These innovative 
approaches also offer substantial promise for social and ecological 
adaptation to climate change. The SRP currently involves work in 8 
river basins containing 36 Federal reservoirs, as well as training and 
development of next-generation decision support tools for water 
management. The Conservancy requests $3 million for the Corps' 
Institute for Water Resources to support engineering and scientific 
needs of current and new SRP sites.
    Savannah Basin Comprehensive Water Resources Study.--The Savannah 
River basin is experiencing tremendous growth, and recent droughts have 
highlighted the need to comprehensively address water use issues in the 
basin. The reconnaissance phase of this study evaluated water 
management in the reservoirs and indicated that future needs may not be 
met under current management practices. The feasibility phase will 
consider a new set of rules that could meet future demands while 
protecting more than 200 miles of river and tens of thousands of acres 
of wetlands. The Conservancy supports $250,000 in fiscal year 2010.
    Willamette River Floodplain Restoration Study.--The Corps and the 
Conservancy are working together to identify ecological flow 
requirements downstream of Corps dams, and to incorporate those flows 
into dam operations. Initial efforts have focused on the Middle and 
Coast Forks of the Willamette, in conjunction with a study to identify 
floodplain habitat restoration opportunities, and implementation and 
monitoring of flow releases are ongoing. Flow analysis has begun in 
additional tributaries, with the ultimate goal of system-wide changes 
in dam operation and floodplain management to meet ecological goals. 
The Conservancy supports $150,000 in fiscal year 2010 to continue this 
study.
    Connecticut River Watershed Study.--This project will restore 410 
miles of river flow and thousands of acres of natural habitat in the 
Connecticut River Basin. The basin is a priority landscape for the 
Conservancy due to its high quality tributary systems, unique natural 
communities and multitude of ESA-listed species. The study identifies 
dam management modifications for environmental benefits while 
maintaining beneficial human uses. We support $450,000 in fiscal year 
2010 for this study.
    Bill Williams River--Alamo Dam.--Numerous Federal, State and 
private partners have invested significant funding in determining the 
flow needs of downstream ecosystems and working with the Corps to 
change operations at Alamo Dam to provide these flows. This request 
will provide additional baseline information about the River and 
continue long-term monitoring to guide future management actions on 
rivers across the southwestern U.S. The Conservancy supports an 
Operations and Maintenance appropriation for Alamo Dam in fiscal year 
2010 that includes $250,000 for these purposes.

                  OTHER CORPS INVESTIGATION PRIORITIES

    Thames River Basin Watershed Study.--The Thames River Basin 
ecosystem, including its tributaries to Long Island Sound, depends on 
naturally variable water flow, good water quality and suitable habitat. 
This study will determine what research and measures are necessary to 
improve the management of water control structures in the basin. We 
support $100,000 in fiscal year 2010 to complete the reconnaissance 
phase.
    Middle Potomac River Watershed Comprehensive Study.--This study 
will develop a comprehensive, multi-jurisdictional sustainable 
watershed management plan for the Middle Potomac River watershed, 
balancing the ecological functions and services provided by the river 
with the human demands upon it. To support the completion of the 
watershed assessment, we support $844,000 in fiscal year 2010.
    Yellowstone River Corridor Comprehensive Study.--Funding this 
ongoing study of economics, fisheries, and wetlands studies will help 
ensure that the longest free-flowing river in the lower 48 States 
maintains its natural functions while supporting irrigation and other 
economic uses of its waters. The Conservancy supports $750,000 for 
fiscal year 2010.
    Lake Champlain Canal Feasibility Study.--Invasive species are the 
most significant threat to the native biodiversity of Lake Champlain in 
New York and Vermont. Several new invaders are poised to enter Lake 
Champlain through the Champlain Canal in coming years, and an invasive 
species dispersal barrier is urgently needed. The Corps is authorized 
to study the feasibility of such a barrier and to construct and operate 
it. The Conservancy supports $500,000 for the feasibility study in 
fiscal year 2010.
    Susquehanna River Basin Low Flow Management and Environmental 
Restoration.--Drought conditions, combined with current and projected 
demands for water use, have the potential to impact natural ecosystems 
in the Susquehanna River basin and the upper Chesapeake Bay. This 
appropriation will fund a basin-wide study to investigate low flow 
conditions and establish ecologically based goals and standards for low 
flow management. The Conservancy supports $285,000 in fiscal year 2010 
for this project.
    Navajo Reservation Watershed Management, Restoration and 
Development.--The San Juan River watershed is severely impacted by 
water withdrawals, flow regulation at Navajo Dam and runoff from 
petroleum extraction and agriculture. This project will formulate a 
conservation strategy for the watershed within the Navajo Nation. The 
Conservancy supports $315,000 in fiscal year 2010 for this project.
    Pecos River Environmental Management Planning.--The Pecos River 
below Santa Rosa Dam is severely affected by flow regulation, 
irrigation, water withdrawals and runoff, preventing native vegetation 
from regenerating and causing frequent drying. This project will help 
develop a comprehensive strategy that identifies key conservation 
targets, critical threats and practical actions to address them. The 
Conservancy supports $840,000 in fiscal year 2010 for this project.

                             CORPS EXPENSES

    Mid-Atlantic River Basin Commissions.--We applaud the subcommittee 
for restoring Federal funding to the Delaware, Potomac, and Susquehanna 
River Basin Commissions in fiscal year 2009. They are essential to 
advancing and coordinating the water management and conservation 
interests of the Federal Government, the affected States, and the 
Conservancy. We support $2,365,000 for the Commissions in fiscal year 
2010.

                         BUREAU OF RECLAMATION

    Upper Colorado River Endangered Fish Recovery and San Juan River 
Basin Recovery Programs.--These programs take a balanced approach to 
restore four endangered fish species in the Colorado River system while 
allowing water use to continue in the arid West. A full appropriation 
will fund work on remaining major capital projects, including the 
completion of fish screens at the Hogback Diversion Dam and Tusher Wash 
Dam. The Conservancy supports $3.2 million in fiscal year 2010 for 
these Programs.
    Platte River Recovery Implementation Program.--An agreement between 
the Governors of Wyoming, Nebraska and Colorado and the Secretary of 
the Interior sets forth a plan to restore five endangered or threatened 
species in the Platte River basin. The Conservancy supports $14,038,500 
for this recovery effort in fiscal year 2010.
    Over the course of the past 10 years, restoration funding through 
the Corps has frequently focused on a select set of large-scale 
programs. These programs have been essential to restoring and 
maintaining some of America's most precious and imperiled ecosystems. 
At the same time, the role of smaller-scale projects should not be 
underestimated for their cumulative benefit and power as demonstrations 
to guide broader-scale efforts. We encourage the subcommittee to 
address the needs of these critical projects while continuing to 
support large-scale programs.
    All of the restoration projects supported in this testimony will 
create the same kinds of on-the-ground jobs created through the 
American Recovery and Reinvestment Act. The restored wetland and water 
resources resulting from these projects will also contribute ongoing 
value to local and regional economies through the important ecosystem 
services provided by healthy waterways and wetlands.
    Thank you for the opportunity to present our comments on the Energy 
and Water Appropriations bill.
                                 ______
                                 
  Prepared Statement of the American Society of Civil Engineers (ASCE)

    Mr. Chairman and members of the subcommittee, the American Society 
of Civil Engineers (ASCE) welcomes the opportunity to provide our views 
on the budget estimates for the U.S. Army Corps of Engineers (USACE or 
the Corps) and the U.S. Bureau of Reclamation (Bureau) for fiscal year 
2010.
    In its recent report on the concurrent resolution for fiscal year 
2010, the House Budget Committee said that the United States faces two 
significant deficits: the first, a budget in deficit this year alone by 
$1.752 trillion, according to the Office of Management and Budget 
(OMB); the second, an economy running at 6.8 percent, or $1 trillion, 
below its potential.
    These are daunting numbers, and Congress confronts a major 
challenge in funding the operations of the Government in light of the 
depressed economy and the continuing Federal deficits.
    But ASCE believes the Nation faces a third deficit--one that is as 
important as the first two. The United States must manage a continuing 
infrastructure investment deficit. Federal outlays for basic public 
works systems have declined relative to gross domestic product (GDP) 
over the past several decades.
    In its 2009 Report Card for America's Infrastructure, ASCE reported 
that the Nation needs to invest approximately $2.2 trillion over the 
next 5 years to maintain the Nation's total infrastructure in good 
condition.
    Even with current and planned investments from Federal, State, and 
local governments in the next 5 years, the ``gap'' between the overall 
need and actual spending will total more than $1 trillion by 2014.
    Within the Nation's general water resources alone, ASCE identified 
a 5-year funding gap of more than $20 billion.
    Nowhere is the infrastructure investment deficit more acute than in 
our waterways. Of the 257 locks still in use on the Nation's inland 
waterways, 30 were built in the 19th century and another 92 are more 
than 60 years old. The average age of all federally owned or operated 
locks is nearly 60 years, well past their planned design life of 50 
years. The cost to replace the present system of locks is estimated at 
more than $125 billion.
congress should appropriate $7 billion for the u.s. corps of engineers 

                CIVIL WORKS PROGRAM IN FISCAL YEAR 2010

    The U.S. Army Corps of Engineers has one of the Federal 
Government's largest environmental responsibilities. The Corps provides 
ecosystem restoration, constructs sustainable facilities, regulates 
waterways and manages natural resources, and cleans up contaminated 
military bases.
    Forty-one States, 16 State capitals and all States east of the 
Mississippi River are served by commercially navigable waterways. The 
U.S. inland waterway system consists of 12,000 miles of navigable 
waterways in four systems that connect with most of the States in the 
United States. The entire system contains 257 locks. The waterways 
include the Mississippi River, the Ohio River Basin, the Gulf 
Intercoastal Waterway, and the Pacific Coast systems.
    Three-quarters of the Nation's inland waterways (9,000 miles) are 
within the Mississippi River system. The next largest segment is the 
Ohio River system (2,800 miles). The Gulf Coast Intercoastal Waterway 
system is 1,109 miles, and the Columbia River system is only 596 miles 
long, the shortest of the four major systems.
    The network includes nearly 11,000 miles of the ``fuel-taxed inland 
waterway system.'' Commercial waterway operators on these designated 
waterways pay a fuel tax, deposited in the Inland Waterways Trust Fund, 
which funds half the cost of new construction and major rehabilitation 
of the inland waterway infrastructure.
    Because of their ability to move large amounts of cargo, the inland 
waterways are a strategic economic and military resource. A recent 
analysis by the U.S. Army War College concluded that ``the strategic 
contributions of these inland waterways are not well understood. The 
lack of adequate understanding impacts decisions contributing to 
efficient management, adequate funding, and effective integration with 
other modes of transportation at the national level. Recommendations 
demonstrate that leveraging the strategic value of U.S. inland 
waterways will contribute to building an effective and reliable 
national transportation network for the 21st century.''
    The current system of inland waterways lacks resilience in that 
waterway usage is increasing but facilities are aging and many are well 
past their design life of 50 years. Recovery from any event of 
significance would be harmed by the age and deteriorated condition of 
the system. Future investment must focus on life-cycle maintenance, 
system interdependencies, redundancy, security, and recovery from 
natural and man-made hazards.
    In spite of inadequate budgets in recent years, the Corps continues 
to keep the waterways functioning. It will open new twin 1,200-foot 
locks on the Ohio River to replace a single, shorter lock built in 
1921. The Corps is currently constructing new, larger locks in several 
States, including Illinois, Kentucky, Louisiana, Pennsylvania, and West 
Virginia.
    The Corps also is embarking on major renovations of several older 
locks. These projects represent a $3.5 billion investment in 
modernizing the Nation's inland waterways. They also include 
significant investments in environmental restoration and management.
    The Corps is bringing new technology online to make waterways 
navigation safer. The latest innovation is called ``real-time current 
and velocities.'' This system alerts waterways users to the real-time 
speed of wind and currents on inland waterways. A total of six systems 
will be completed by the end of 2009.
    In addition to the infrastructure mentioned above, the Corps has 
major responsibilities in other areas. It protects coastlines; develops 
flood-reduction and hydropower projects; oversees 4,300 recreation 
areas at 420 lakes in 43 States; and operates 134 multiple-purpose 
projects that contain storage for water supply in 26 States and Puerto 
Rico.
    The USACE also shares responsibility among Federal, State and local 
agencies, and private landowners for raising awareness and 
understanding of the risks associated with living and working behind 
levees.
    The fiscal year 2009 appropriation for the Corps of Engineers is 
$5.4 billion, but the construction backlog for the Corps tops $60 
billion nationwide. Even with the addition of $4.6 billion for fiscal 
year 2009 through the American Recovery and Reinvestment Act, the 
investment deficit on our waterways remains at an estimated $20.5 
billion through 2014.
    The President's budget proposal for fiscal year 2010 is $5.1 
billion. Despite the difficult budget climate and the dismal economic 
picture, we urge an appropriation of $7 billion in fiscal year 2010 to 
begin the long overdue process of rebuilding America's water resources 
infrastructure.

    CONGRESS SHOULD APPROPRIATE $1.3 BILLION FOR THE U.S. BUREAU OF 
                    RECLAMATION IN FISCAL YEAR 2010

    The Bureau of Reclamation's mission is to ``manage, develop, and 
protect water and related resources in an environmentally and 
economically sound manner in the interest of the American public.'' The 
Bureau is the Nation's largest wholesale water supplier; it administers 
348 reservoirs with a total storage capacity of 245 million acre-feet 
of water. It provides water to more than 31 million customers and 
supplies 20 percent of western farmers with water to irrigate 10 
million acres of farmland.
    In addition, the Bureau is the Nation's second largest producer of 
hydroelectric power, generating more than 40 billion kilowatt-hours of 
energy each year--an amount equivalent to the energy provided by 80 
million barrels of crude oil. In the 100 years since Reclamation's 
creation, the Federal Government has invested almost $21 billion in 
original development costs for its infrastructure and other facilities.
    The Bureau operates 348 dams and reservoirs, 58 hydropower 
generation facilities, more than 8,000 miles of canals, more than 
24,000 miles of water distribution laterals, and more than 13,000 miles 
of drains. ASCE notes that most of Reclamation's major dams, 
reservoirs, hydroelectric plants, and irrigation systems are 50 or more 
years old. In December 2007, the Bureau calculated that nearly 80 of 
the 348 dams (approximately 23 percent) are 90 to 100 years old or 
older.
    The Bureau has identified an estimated $3 billion in total 
infrastructure investment needs over the next 20 years.
    We concur with former Commissioner Robert Johnson, who informed 
Congress in 2008 that, although the Bureau and its more than 350 
operating partners have successfully operated and maintained the 
infrastructure to date, the aging process will inevitably lead to 
increased pressure on budgets and user rates to keep infrastructure 
service and reliability corresponding with past levels. The Bureau and 
its partners anticipate a steady increase in infrastructure repair 
needs that will continue to grow over time, the Bureau said last April.
    The fiscal year 2009 appropriation was $1.1 billion, the same as 
fiscal year 2008, for dams, canals, water treatment and conservation, 
and rural water projects. The fiscal year 2010 proposal is $1.020 
billion. Congress should appropriate $1.3 billion for the U.S. Bureau 
of Reclamation in fiscal year 2010, with the bulk of the increase set 
aside for infrastructure renewal under the Bureau's 5-year capital 
improvement plan.
                                 ______
                                 
 Prepared Statement of the Board of Levee Commissioners for the Yazoo-
                           Mississippi Delta

 U.S. ARMY CORPS OF ENGINEERS MISSISSIPPI RIVER & TRIBUTARIES PROJECT 
                 FISCAL YEAR 2010 REQUEST--$500 MILLION

    As the front line flood protection provider for the approximately 
300,000 Mississippians who reside within the 10 counties of our levee 
district, the Yazoo-Mississippi Delta Levee Board humbly requests that 
you allocate adequate funding to fully fund the Mississippi River and 
Tributaries Project (MR&T) at the Corps of Engineers' capability level 
for the 2010 fiscal year--$500 million.
    And yes, we do know that is a lot of money. Even in this time--one 
which many of us believed we'd never see--of trillion dollar deficits 
and untold trillions in evaporated wealth, we do indeed know that $500 
million is a lot of money.
    We know that these are perilous times for our Nation, times in 
which the collective wisdom and sound judgment of you men and women 
will be nothing less than critical to our well being as a people. We 
know there are simply fiscal limits and we know that priorities must be 
and will be set.
    But we also know that flood control is nothing less than vital to 
America's heartland. In many cases, such as our part of the Mississippi 
Delta, flood control is the primary factor allowing those who live 
there to live there. The heartland produces much of the food and fiber 
which allows us to feed and clothe not only our Nation, but much of the 
world. But there can be no food, there can be no fiber if the most 
fertile soils this side of the Nile delta were to be under water--were 
to be again inundated by the same water which created them.
    The Mainline Mississippi River Levee System, truly one of the 
world's greatest engineering marvels, is literally all that stands 
between the human beings who live and produce and prosper up and down, 
along either side of the Mississippi River--the largest, most powerful 
and often most fickle flowing waterway on the North American continent. 
Our levees are strong, true and tested, but like all the creations of 
man, they must be maintained; they must be vigilantly strengthened and 
repaired from the ravages of the power they contain every day.
    We ask that the MR&T's levees be funded at levels of $69.972 
million for construction, $61.2 million for channel improvements, 
$13.522 million for levee maintenance and $79.309 million for channel 
maintenance.
    There are many projects, many efforts within the flood control 
umbrella that is the MR&T, and there are many who will speak to you on 
behalf of them, but for our people, for the lives and livelihoods of 
those we are dedicated to protect, there is only this levee board to 
speak. And so we now will.
    For us there must remain one overriding priority--the Upper Yazoo 
Project. Ladies and Gentlemen, this effort designed to protect 
thousands from chronic flooding along the Yazoo/Coldwater river system, 
is perhaps the least controversial flood control project in the Nation, 
favored not only by our citizenry but the environmental community, as 
well. It is designed and it is demonstratively effective within its 
completed reaches. It need only be adequately funded to provide long 
awaited relief to those who have suffered for many years.
    We ask that you provide the Corps capability funding level of $24.4 
million in 2010.
    We also ask that this collective Congress provide funding for the 
following projects affecting our district and its people at the 2010 
capability levels:

------------------------------------------------------------------------

------------------------------------------------------------------------
                    CONSTRUCTION
Backwater...........................................            $325,000
Main Stem...........................................             $25,000
MS Delta Headwaters.................................         $25 million
Big Sunflower River.................................       $2.18 million
Reformulation Study.................................          $3 million

                     MAINTENANCE

Revetments and Dikes................................       $58.2 million
Sardis Lake.........................................     $14.483 million
Arkabutla Lake......................................     $13.793 million
Enid Lake...........................................      $12.69 million
Grenada Lake........................................     $13.231 million
Greenwood...........................................       $1.85 million
Yazoo City..........................................            $550,000
Yazoo Main Stem.....................................      $3.154 million
Yazoo Tributaries...................................            $953,000
Big Sunflower.......................................      $4.311 million
Yazoo Backwater.....................................            $905,000
------------------------------------------------------------------------

    Thank you for your careful consideration of our requests and we 
trust that once again, as has been so critical for our people on so 
many occasions over the years, the old adage will once again be 
validated: ``The President proposes, but the Congress disposes.''
                                 ______
                                 
     Prepared Statement of the California State Coastal Conservancy

                                SUMMARY

    On behalf of the California State Coastal Conservancy, I want to 
thank the subcommittee for this opportunity to present our priorities 
for fiscal year 2010 and, at the same time, express our appreciation 
for your support of the Conservancy's projects in past years. The 
Conservancy respectfully requests needed funding for the following 
critical U.S. Army Corps of Engineers projects during fiscal year 2010. 
All of these requests reflect Corps of Engineers capability for the 
individual projects: $18 million for the Matilija Dam Ecosystem Project 
(Construction General); $7,750,000 for Napa River Salt Marsh Project 
(Construction General); $18,500,000 for the Hamilton Bel-Marin Keys 
Wetland Restoration Project (Construction General) and $2,800,000 for 
the South San Francisco Bay Shoreline Study (General Investigations).

                         CONSERVANCY BACKGROUND

    The California Coastal Conservancy, established in 1976, is a State 
agency that uses entrepreneurial techniques to purchase, protect, 
restore and enhance coastal resources while providing public access to 
the shore. We work in partnership with local governments, other public 
agencies, nonprofit organizations, and private landowners to accomplish 
these goals.
    To date, the Conservancy has undertaken more than 950 projects 
along the 1,100 mile California coastline and around San Francisco Bay, 
resulting in completed projects in every coastal county and all 9 San 
Francisco Bay Area counties. Through these projects, the Conservancy: 
protects and improves coastal wetlands, streams, and watersheds; works 
with local communities to revitalize urban waterfronts; assists local 
communities in solving complex land-use problems; and protects 
agricultural lands and supports coastal agriculture, to list a few of 
its main activities.
    Since our establishment in 1976, the Coastal Conservancy has: 
helped build more than 300 access ways and trails opening more than 80 
miles of coastal and bay lands for public use; assisted in the 
completion of over 100 urban waterfront projects; and joined in 
partnership endeavors with more than 100 local land trusts and other 
nonprofit groups, making local community involvement an integral part 
of the Coastal Conservancy's work.

  MATILIJA DAM ECOSYSTEM RESTORATION PROJECT--CORPS OF ENGINEERS, LOS 
                            ANGELES DISTRICT

    In fiscal year 2010 we are seeking $18,500,000 in Construction 
funding for the Army Corps of Engineers Construction General account to 
finalize design and begin the removal of the Matilija Dam in Ventura 
County, California. Approximately $1 million will be utilized to 
finalize design activities and the remaining $14 million in Corps 
capability will be used to advance construction of the project. Of that 
amount, approximately $7,500,000 would be designated for construction 
activities associated with the high-flow bypass of the dam with the 
remaining $5,500,000 being utilized for the building of levees 
downstream from the site.
    The Matilija Dam Ecosystem Restoration Project, authorized in 
Public Law 110-114, is a project of vital importance and consists of 
the removal of the no longer needed or functional 200-foot tall 
Matilija Dam, located on a tributary to the Ventura River. The dam is 
currently unusable as sediment has filled in its reservoir. Completion 
of the project will reopen 17.3 miles of unimpeded habitat for the 
endangered steelhead trout and other aquatic species. In addition, the 
project will restore over 2,800 acres of habitat that will support a 
wide variety of native species, including 25 special status species 
while replenishing area beaches by allowing sand (now trapped behind 
the Dam) to flow to coastal beaches upon the Dam's removal.
    The removal of Matilija Dam will also provide extensive economic 
benefits in addition to the environmental benefits that will be 
accrued. Specifically, over the life of the project we can expect an 
increase in California's economic output of $250 million and the 
creation of 1,500 jobs for the $100 million investment in the 
construction of the project. In the more immediate future (3 years) 
there would be an economic benefit of $150 million and the creation of 
over 900 jobs making the project a sound investment in California and 
the Nation's economy.
    This project is one of the largest dam removal projects in the 
Country and enjoys broad support from many local, State and Federal 
agencies. To remove the dam, 6 million cubic yards of sediments will be 
moved or recontoured and a high flow sediment bypass system will be 
constructed at a water diversion downstream. In addition, a silt 
removal system will be installed along the diversion canal. 
Furthermore, levees will be built in several places along the river 
channel to protect property from flooding due to the expected increases 
in stream channel elevation in the first years after removal of the 
dam. The project also involves removal of invasive plants and the 
installation of replacement water wells.

   NAPA RIVER SALT MARSH--CORPS OF ENGINEERS, SAN FRANCISCO DISTRICT

    For fiscal year 2010, we are seeking $8 million in construction 
funds to continue to advance this critical project that is nearly two-
thirds complete. The only remaining work is that which was authorized 
for construction in Public Law 110-114 and must be undertaken by the 
U.S. Army Corps of Engineers. The funds requested would allow the Corps 
of Engineers to complete design and begin construction of their portion 
of the Napa River Salt Marsh Project which includes the restoration of 
Ponds 6-8. It is important to note that the project can be completed 
quickly as it only requires a total of $13 million to construct the 
Ponds 6-8 improvements over an estimated 2-year construction period.
    Substantial funding during the current fiscal year is essential to 
ongoing project success as the local sponsors have spent their full 
share and have no additional State or local funds dedicated to the 
project to continue its implementation. State and local partners 
expended their share on completion of Phases I and II of the project. 
Phase I involved opening 3,000 acres of salt ponds (Ponds 3, 4, and 5) 
to full tidal action in 2006 and is the largest tidal restoration 
project in the San Francisco Bay to date. Phase II involved the 
restoration of 1,700 acres (Ponds 1/1A, and 2) to managed ponds for 
waterfowl and shorebirds in 2007. Without Federal funding this fiscal 
year, the project will continue to be halted, benefits will continue to 
be delayed and project costs will increase greatly.
    The project is part of a larger environmental restoration effort to 
restore the Nation's second largest estuary the San Francisco Bay, and 
its watershed, to its natural state. This restoration effort is 
expected to improve the environmental sustainability of the Estuary 
while providing great scenic and recreational values for the local 
community. Federal funds are critically required for the completion of 
the project whose extensive benefits to the region include: providing 
extensive wetland habitat in San Francisco Bay; the beneficial use for 
recycled water in the North Bay; improved open space and recreational 
opportunities; and resolving urgent issues associated with 
deterioration of the site's levee, water control structures, and water 
quality.
    Our request reflects Corps capability and funding will be utilized 
to complete design of Ponds 6-8. In addition, funding will initiate 
design of the recycled water pipeline, an item expressly included by 
Congress in the project's authorization. Funds will also be used to 
secure necessary permits and approvals and begin construction of Ponds 
6-8.
    The 10,000 acre Napa River Salt Marsh was purchased by the State of 
California from Cargill in 1994 and is managed by the California 
Department of Fish and Game. The State Coastal Conservancy has been the 
non-Federal sponsor working with the Corps on the Feasibility Study. 
The Corps' Feasibility Study was completed and the Chief's Report was 
signed in December 2004.

     HAMILTON BEL-MARIN KEYS WETLAND RESTORATION PROJECT--CORPS OF 
                   ENGINEERS, SAN FRANCISCO DISTRICT

    In fiscal year 2010, the California State Coastal Conservancy is 
seeking $18,500,000 in Construction funding for the Hamilton Bel-Marin 
Keys Wetland Restoration Project. The project was authorized by 
Congress in 1999 (Public Law 106-53) and our request reflects Corps 
capability for the project.
    This project is of critical importance as it will provide nearly 
700 acres of restored tidal and seasonal wetlands at a former Army base 
and provides much needed habitat for several threatened and endangered 
species; as well as, shorebirds and waterfowl migrating along the 
Pacific Flyway. Because the project requires large volumes of dredged 
sediment for completion, this project will result in a greatly reduced 
need to dispose of sediment in the Bay and Pacific Ocean, which has 
direct benefits to aquatic life. Furthermore, the project also 
beneficially uses dredged material from the San Francisco Bay which 
provides for increased navigation and maritime commerce, a much needed 
economic stimulus for the region. In addition to the extensive 
environmental and maritime navigation benefits, the project will also 
serve as a key driver for the regional economy as implementation and 
full funding is expected to bring approximately 304 jobs to Marin 
County, California.
    The project was provided full funding in the Omnibus Appropriations 
Act of 2009 and as a result work is currently underway. As a result of 
this significant commitment, the majority of the required site 
preparation has been completed on the former Army Airfield, including 
the construction of miles of levees. The main runway and taxiways are 
now in the process of being buried under millions of cubic yards of 
clean dredged sediment. Subsequently, the easterly levee will be 
breached allowing tidal waters to once again flood the site. 
Significant progress has been made as over 2.4 million cubic yards 
being delivered to Hamilton as of January 2009. To complete the 
Airfield portion of the project an additional 5 million cubic yards of 
sediment is needed. Under the current schedule it is expected that 
completion of the Airfield portion of the project will occur between 
2013 and 2015. Following completion of the Airfield, the Corps will 
work on the adjacent Antenna field and Bel-Marin Keys V property for a 
total project area of nearly 2,500 acres.
    The project enjoys broad support from environmental groups, labor 
and maritime interests as well as local government in Marin County. Key 
supporters include the San Francisco Bay Joint Venture, the County of 
Marin, the Port of Oakland, the Bay Planning Coalition, the Bay 
Institute, the Save San Francisco Bay Association, the National Audubon 
Society, and many others.

   SOUTH SAN FRANCISCO BAY SHORELINE STUDY--CORPS OF ENGINEERS, SAN 
                           FRANCISCO DISTRICT

    The Conservancy is seeking $2,800,000 in Investigations funding to 
continue the Feasibility Study for this groundbreaking project that 
will provide tidal and fluvial flood protection to the south San 
Francisco Bay Area. The study was initiated in fiscal year 2005 and has 
been ongoing thanks to the support of the subcommittee. In fact, in the 
Omnibus Appropriations Act of 2009 the project received $2,800,000 
representing full capability for the project.
    This project is of national significance as it will provide tidal 
and fluvial flood protection for the south San Francisco Bay Area, 
including Silicon Valley, protecting approximately 42,800 acres, 7,400 
homes and businesses, and significant urban infrastructure, including 
major highways, hospitals and airport facilities. In addition, the 
project is being pursued in conjunction with the 2nd largest wetlands 
restoration project occurring in the United States and as such will 
provide extensive habitat for federally endangered species and 
migratory waterfowl.
    To continue to advance this important study it is imperative that 
local interests and the Federal Government work together to ensure a 
reliable funding stream for the project. To that end, continued Federal 
funds are necessary to keep the project on schedule as the 
Conservancy's co-local sponsor for the project, the Santa Clara Valley 
Water District, will be approaching voters in 2012 to secure local 
funding for the construction of the recommended project. When this 
occurs, the District needs to have a deliverable product that they can 
showcase to voters given the fact that California's Proposition 13 
requires that any new taxation be approved by a two-thirds majority of 
voters.
    During fiscal year 2010 we are seeking $2,800,000 in accordance 
with Corps of Engineers capabilities for the project during the current 
fiscal year. Funds in fiscal year 2010 are expected to be used for the 
following activities: Hydrology, Hydraulics and Coastal Analysis--$1 
million; Economics Analysis--$250,000; Plan Formulation--Alternatives 
Development $250,000; Habitat Evaluation Analysis--$150,000; NEPA--EIS 
Development--$400,000; Engineering & Design/Geotech--$200,000; Project 
Management--$400,000 and Surveys & Mapping--$150,000.
    The project enjoys substantial support among Federal, State and 
local agencies with the following agencies serving as active project 
partners: California State Coastal Conservancy; California Department 
of Fish and Game; U.S. Fish and Wildlife Service; U.S. Army Corps of 
Engineers, NOAA, U.S. Geological Survey; Santa Clara Valley Water 
District; Alameda County Flood Control and Water Conservation District; 
Hewlett, Packard, and Moore Foundations and the Goldman Fund. The 
project is also supported by the San Francisco Bay Joint Venture, the 
city of San Jose, The Bay Institute, Save the Bay, the Bay Trail 
Program, the National Audubon Society, and many other local 
governments, environmental groups, community groups, businesses, and 
recreation organizations.
                                 ______
                                 
      Prepared Statement of the Santa Clara Valley Water District

                                SUMMARY

    This statement urges the subcommittee's support for a fiscal year 
2010 appropriation of $100,000 to initiate a Reconnaissance Study of 
the Coyote Creek Watershed.

           STATEMENT OF SUPPORT--COYOTE CREEK WATERSHED STUDY

    Background.--Coyote Creek drains Santa Clara County's largest 
watershed, an area of more than 320 square miles encompassing most of 
the eastern foothills, the city of Milpitas, and portions of the Cities 
of San Jose and Morgan Hill. It flows northward from Anderson Reservoir 
through more than 40 miles of rural and heavily urbanized areas and 
empties into south San Francisco Bay.
    Prior to construction of Coyote and Anderson Reservoirs, flooding 
occurred in 1903, 1906, 1909, 1911, 1917, 1922, 1923, 1926, 1927, 1930 
and 1931. Since 1950, the operation of the reservoirs has reduced the 
magnitude of flooding, although flooding is still a threat and did 
cause damages in 1982, 1983, 1986, 1995, and 1997. Significant areas of 
older homes in downtown San Jose and some major transportation 
corridors remain susceptible to extensive flooding. The federally-
supported lower Coyote Creek Project (San Francisco Bay to Montague 
Expressway), which was completed in 1996, protected homes and 
businesses from storms which generated record runoff in the northern 
parts of San Jose and Milpitas.
    The proposed Reconnaissance Study would evaluate the reaches 
upstream of the completed Federal flood protection works on lower 
Coyote Creek.
    Objective of Study.--The objectives of the Reconnaissance Study are 
to investigate flood damages within the Coyote Creek Watershed; to 
identify potential alternatives for alleviating those damages which 
also minimize impacts on fishery and wildlife resources, provide 
opportunities for ecosystem restoration, provide for recreational 
opportunities; and to determine whether there is a Federal interest to 
proceed into the Feasibility Study Phase.
    Study Authorization.--In May 2002, the House of Representatives 
Committee on Transportation and Infrastructure passed a resolution 
directing the Corps to ``. . . review the report of the Chief of 
Engineers on Coyote and Berryessa Creeks . . . and other pertinent 
reports, to determine whether modifications of the recommendations 
contained therein are advisable in the interest of flood damage 
reduction, environmental restoration and protection, water conservation 
and supply, recreation, and other allied purposes . . .''.
    Fiscal Year 2006 Administration Budget Request and Funding.--The 
Coyote Watershed Study was one of only three ``new start'' studies 
proposed for funding nationwide in the administration fiscal year 2006 
budget request. Congress did not include funding for the study in the 
final fiscal year 2006 appropriations bill, or in any subsequent bills.
    Fiscal Year 2009 Funding.--Congress did not appropriate any funding 
to the project in fiscal year 2009.
    Fiscal Year 2010 Funding Recommendation.--It is requested that the 
Congressional Committee support an appropriation of $100,000 to 
initiate a multi-purpose Reconnaissance Study within the Coyote Creek 
Watershed.

                                SUMMARY

    This statement urges the subcommittee's support for a fiscal year 
2010 appropriation of $2.25 million to complete the General 
Reevaluation Report, update of environmental documents, and commence 
design work for the Berryessa Creek Flood Protection Project element of 
the Coyote/Berryessa Creek Project.

 STATEMENT OF SUPPORT--COYOTE/BERRYESSA CREEK PROJECT--BERRYESSA CREEK 
                            PROJECT ELEMENT

    Background.--The Berryessa Creek Watershed is located in northeast 
Santa Clara County, California, near the southern end of the San 
Francisco Bay. A major tributary of Coyote Creek, Berryessa Creek 
drains 22 square miles in the city of Milpitas and a portion of San 
Jose.
    On average, Berryessa Creek floods once every 4 years. The most 
recent flood in 1998 resulted in significant damage to homes and 
automobiles. The proposed project on Berryessa Creek, from Calaveras 
Boulevard to upstream of Old Piedmont Road, will protect portions of 
the cities of San Jose and Milpitas. The flood plain is largely 
urbanized with a mix of residential and commercial development. Based 
on the U.S. Army Corps of Engineers (Corps) 2005 report, a 1 percent or 
100-year flood could potentially result in damages exceeding $179 
million. Benefit-to-cost ratios for the six project alternatives being 
evaluated range from 2:1 to 7.3:1.
    Study Synopsis.--In January 1981, the Santa Clara Valley Water 
District (District) applied for Federal assistance for flood protection 
projects under section 205 of the 1948 Flood Control Act. The Water 
Resources Development Act of 1990 authorized construction on the 
Berryessa Creek Flood Protection Project as part of a combined Coyote/
Berryessa Creek Project to protect portions of the cities of Milpitas 
and San Jose.
    The Coyote Creek element of the project was completed in 1996. The 
Berryessa Creek Project element proposed in the Corps' 1987 feasibility 
report consisted primarily of a trapezoidal concrete lining. This was 
not acceptable to the local community. The Corps and the District are 
currently preparing a General Reevaluation Report which involves 
reformulating a project which is more acceptable to the local community 
and more environmentally sensitive. Project features will include 
setback levees and floodwalls to preserve sensitive areas (minimizing 
the use of concrete), appropriate aquatic and riparian habitat 
restoration and fish passage, and sediment control structures to limit 
turbidity and protect water quality. The project will also accommodate 
the city of Milpitas' adopted trail master plan. Estimated total costs 
of the General Reevaluation Report work are $6.5 million, and should be 
completed in 2009.
    Fiscal Year 2009 Funding.--Congress appropriated $138,000 to the 
project in fiscal year 2009.
    Fiscal Year 2010 Funding Recommendation.--Based on the continuing 
threat of significant flood damage from Berryessa Creek and the need to 
complete the General Reevaluation Report, it is requested that the 
Congressional Committee support an appropriation of $2.25 million for 
the Berryessa Creek Flood Protection Project element of the Coyote/
Berryessa Creek Project.
                                 ______
                                 
       Prepared Statement of the Calaveras County Water District

                            PROJECT REQUESTS
------------------------------------------------------------------------
                                                                Amount
------------------------------------------------------------------------
NEW HOGAN WATER DISTRIBUTION SYSTEM (Construction General--     $600,000
 section 219)..............................................
COSGROVE CREEK FLOOD CONTROL PROJECT (Construction General--     200,000
 section 205)..............................................
CALAVERAS COUNTY REGIONAL WATER/WASTEWATER AND RECYCLED          600,000
 WATER FACILITIES PROGRAM--PHASE II (Construction General--
 section 5039).............................................
------------------------------------------------------------------------

                                OVERVIEW

    On behalf of the Calaveras County Water District, I want to thank 
the subcommittee for this opportunity to present our priorities for 
fiscal year 2010 and, at the same time, express our appreciation for 
your support of the District's projects in recent years. The Calaveras 
County Water District is respectfully seeking the following requests 
before the Senate Energy and Water Development Appropriations 
Subcommittee from the U.S. Army Corps of Engineers during fiscal year 
2010. We are seeking $600,000 from the Corps of Engineers Construction 
General Account section 219 for our New Hogan Water Distribution System 
request; $200,000 from the Corps of Engineers Construction General 
Account section 205 for the Cosgrove Creek Flood Control Project; and 
$600,000 from the Corps Construction General Account section 5039 for 
the Calaveras County Regional Water/Wastewater and Recycled Water 
Facilities Program Phase II.
    As background, our agency, the Calaveras County Water District 
(CCWD) was founded in the fall of 1946 and was organized under the laws 
of the State of California as a public agency for the purpose of 
developing and administering the water resources in Calaveras County. 
Therefore, CCWD is a California Special District and is governed by the 
California Constitution and the California Government and Water Codes. 
CCWD is not a part of, or under the control of, the County of 
Calaveras. CCWD was formed to preserve and develop water resources and 
to provide water and wastewater service to the citizens of Calaveras 
County.
    Under State law, CCWD, through its board of directors, has general 
powers over the use of water within its boundaries. These powers 
include, but are not limited to: the right of eminent domain, authority 
to acquire, control, distribute, store, spread, sink, treat, purify, 
reclaim, process and salvage any water for beneficial use, to provide 
sewer service, to sell treated or untreated water, to acquire or 
construct hydroelectric facilities and sell the power and energy 
produced to public agencies or public utilities engaged in the 
distribution of power, to contract with the United States, other 
political subdivisions, public utilities, or other persons, and subject 
to the California State Constitution, levy taxes and improvements.

                  NEW HOGAN WATER DISTRIBUTION PROJECT

    CCWD is seeking $600,000 in fiscal year 2010 for the New Hogan 
Water Distribution Project, a multi-phased project that will improve 
the region's water supply, significantly increase and protect water 
quality and provide significant environmental restoration that will 
greatly increase habitat for local wildlife while increasing 
recreational opportunities for the local community. The project will 
construct infrastructure to convey surface water to existing and 
expanding agricultural acreage in western Calaveras County. The area 
currently relies on a diminishing groundwater supply, which is 
experiencing water quality problems and has been identified by the 
State as an overdrafted groundwater basin. The project will include 
monitoring facilities to continually evaluate the region's sensitive 
groundwater basin and its response to conjunctive use operation and 
will also include enhanced modeling tools that evaluate the 
effectiveness of planned or proposed facilities for expanding 
conjunctive use in the region.
    The project will provide a sustainable water supply for the western 
Calaveras County region experiencing declining groundwater levels, 
water quality deterioration, expanding agriculture, significant 
population growth, and the continuing threat of drought. Infrastructure 
will be built to convey surface water from existing reservoirs and 
water rights and entitlements permitted or contracted by the Calaveras 
County Water District to areas at greatest risk for groundwater supply 
problems. Through introduction of surface water planned decades ago, 
the Calaveras County Water District will introduce conjunctive use to 
increase water supply reliability for all surface water and groundwater 
users within the western Calaveras County region. The project will 
benefit all of California as it will minimize the losses of naturally 
occurring springs and will improve stream-flow conditions for river 
tributaries of the Sacramento-San Joaquin River Delta, which provides 
two-thirds of the State of California with water. Finally, water 
conservation and wastewater recycling are critical elements that can 
reduce demands or stretch existing water supplies. Assessment of public 
outreach and environmental documentation needs will also be performed, 
as identified in a project management plan.
    Cost Breakdowns for this project in fiscal year 2010 are listed as 
follows: Negotiation Project Partnership Agreement (PPA) and initial 
planning, design, and construction contract $50,000; develop Calaveras-
Mokelumne Master Plan Concept $50,000; water supply and demand analysis 
$75,000; alternatives formulation and analysis $175,000; environmental 
program development $75,000; development of institutional partnerships 
and public outreach, $100,000; development of Feasibility Report 
$75,000.

                  COSGROVE CREEK FLOOD CONTROL PROJECT

    CCWD, in conjunction with Calaveras County, is seeking $200,000 in 
the Construction General section 205 account for the Cosgrove Creek 
Flood Control Project. The project will address flooding that occurs 
along the lower reaches of the creek, as well as flooding that occurs 
on Spring Creek. Flooding in these areas impacts over 400 people and 
100 structures located in the 100-year floodplain. The project will 
attenuate peak flows, address the beneficial use of peak flows, 
stabilize creek banks, improve natural conditions favorable to wetlands 
and riparian habitat, and increase recreational opportunities in the 
area. In addition to providing critical flood control for the region, 
the project will provide a number of ancillary benefits including; the 
beneficial use of flood flows including sprayfields, conjunctive use of 
recycled water and wetlands restoration. Further, the project will 
provide additional riparian habitat and much-needed recreational 
opportunities through the creation of hiking/riding trails and numerous 
athletic fields for use by the local community.

     CALAVERAS COUNTY REGIONAL WATER/WASTEWATER AND RECYCLED WATER 
                      FACILITIES PROGRAM--PHASE II

    CCWD third and final priority for fiscal year 2010 is a request for 
$600,000 to support the Calaveras County Regional Water/Wastewater and 
Recycled Water Facilities Program Phase II, a multi-phase, 
collaborative project to investigate strategic opportunities to correct 
water and wastewater utility deficiencies along the Highway 4 corridor 
in the Stanislaus River Watershed of Calaveras County.
    Utility regionalization and improved coordination are needed to 
support sustainable practices in the Sierra Nevada foothill 
communities. This project would create partnerships between local, 
State, and Federal agencies so that infrastructure improvements, 
replacement needs, and growth decisions can be coordinated in a manner 
that respects connections between water, wastewater, land use, and 
development within the watershed thereby greatly enhancing the 
utilization and safeguarding of our region's water resources.
    To accomplish these objectives CCWD will partner with Calaveras 
County, the city of Angels, Murphys Sanitary District, Union Public 
Utility District, and the Utica Power Authority. Through the 
identification of particular problem areas and collaboration with our 
local partners a ``living'' model will be developed to examine 
strategies for regionalizing water and wastewater facilities. A 
technical team consisting of project partners will develop preliminary 
concept plans based on shared goals, objectives, and priorities. 
Information will be circulated among all stakeholders and strong 
community involvement plan will be put forth that will incorporate the 
suggestions of the public and interested non-governmental 
organizations. This original model will then be further refined to 
evaluate concepts achieving maximum beneficial use to ensure a 
sustainable, cost-effective concept plan emerges for regional watershed 
implementation.
    Cost breakdowns for this critical project in fiscal year 2010 are 
listed as follows: Negotiation of PPA and Initial planning, design, and 
construction contract $50,000; development of regional water/wastewater 
and recycled water master plan concept $50,000; summary of existing 
facilities and regulatory setting $50,000; evaluation of wastewater and 
water supply needs $75,000; formulation and evaluation of alternatives 
$200,000; development of institutional partnerships and public outreach 
$100,000; and reparation of Feasibility Study $75,000.
                                 ______
                                 
        Prepared Statement of the Izaak Walton League of America

    The Izaak Walton League of America appreciates the opportunity to 
submit testimony concerning appropriations for fiscal year 2010 for 
programs under the jurisdiction of the subcommittee. The League is a 
national, nonprofit organization founded in 1922. We have nearly 37,000 
members and 270 community-based chapters nationwide. Our members are 
committed to advancing common sense policies that safeguard wildlife 
and habitat, support community-based conservation, and address pressing 
environmental issues. The following pertains to programs administered 
by the U.S. Army Corps of Engineers.
corps of engineers, operations and maintenance, upper mississippi river
    The League supports strong financial efforts for ecosystem 
restoration for the Upper Mississippi River (UMR). We have supported 
the Environmental Management Program (EMP) since its inception and 
continue to support this vital restoration program. EMP should be fully 
funded at its authorized level of $33.2 million and the current 
restriction for starting new EMP projects should be lifted. It is 
important to note that even this level of investment can serve only to 
slow the pace of UMR degradation, not achieve net restoration.
    The League has also strongly expressed its opinion that the large-
scale navigation modifications included in the Recommended Plan for the 
Upper Mississippi Navigation and Ecosystem Sustainability Program 
(NESP), as authorized by the Water Resources Development Act of 2007, 
have not been justified by the Corps and should not be pursued. 
Previous reviews from the National Academy of Sciences and the 
Assistant Secretary of the Army, Civil Works found that the navigation 
construction component of NESP was not economically justifiable.
    The League has strong roots in the Upper Mississippi River region. 
Protecting the basin has been a key issue for our members since we led 
the fight to create the Upper Mississippi River Fish and Wildlife 
Refuge in 1924. The League has spearheaded efforts to reform the lock 
and dam navigation system to ensure that flows and habitat remain as 
natural as possible. We also work to promote sustainable agriculture 
practices and implement farm conservation programs to reduce polluted 
runoff. Our testimony reflects many decades of experience on the Upper 
Mississippi River and our direct 15-year involvement with the Upper 
Mississippi River--Illinois Waterway (UMR-IWW) navigation study.
    The Upper Mississippi River is one of the most complex ecosystems 
on earth. It provides habitat for 50 species of mammals, 45 species of 
reptiles and amphibians, 37 species of mussels, and 241 species of 
fish. The need for ecosystem restoration is unquestionable. As the 
Corps correctly stated in its study of navigation expansion, this 
ecosystem is ``significantly altered, is currently degraded, and is 
expected to get worse.'' Researchers from the National Academy of 
Sciences have determined that river habitat is disappearing faster than 
it can be replaced through existing programs such as the Corps' 
Environmental Management Program, which was authorized at $33.2 million 
annually by Congress in 1999, but has never received full 
appropriations. As habitat vanishes, scientists warn that many species 
will decline and some will disappear.
    Our Nation relies on a healthy Mississippi River for commerce, 
recreation, drinking water, food supply and power. More than 12 million 
people annually recreate on and along the Upper Mississippi River 
spending $1.2 billion and supporting 18,000 jobs. More people recreate 
on the Upper Mississippi than visit Yellowstone National Park. Notably, 
barge traffic has remained static on the river for more than two 
decades with real declines in recent years.
    The Water Resources Development Act of 2007 authorizes the 
Navigation and Ecosystem Sustainability Program (NESP) for the Upper 
Mississippi River. NESP allocates $2.2 billion for new navigation-
related construction and $1.7 billion for ecosystem restoration over an 
initial 15-year project phase. Included in the $2.2 billion is over 
$256 million for small-scale and non-structural navigation projects 
that we fully support. However, we have consistently opposed the 
unnecessary spending of tax dollars on the economically unsound new 
locks, a position further bolstered by the continuing annual declines 
in barge traffic on the UMR.
    In assembling the UMR-IWW navigation study, the Corps recognized 
the critical need for UMR ecosystem restoration work and encouraged 
Congress to invest approximately $130 million annually in Upper 
Mississippi River habitat restoration efforts. With this demonstrated 
need in mind, the League strongly encourages the subcommittee to 
prioritize investment in ecosystem restoration. Appropriating 
significant funding for restoration will provide near-term economic 
stimulus in communities along the UMR and long-term conservation and 
economic benefits for the region and the Nation.
    The administration's budget does not request funding for NESP. The 
League supports increasing fiscal year 2010 NESP navigation funding to 
adequately cover the cost of initiating small-scale and non-structural 
navigation projects only. We strongly support increasing total 
ecosystem restoration funding incrementally, in an efficient and 
effective manner, to reach the total $130 million investment as soon as 
feasible.

     CORPS OF ENGINEERS, OPERATIONS AND MAINTENANCE, MISSOURI RIVER

    For fiscal year 2010, we urge the subcommittee to provide at least 
$70 million as the President has specifically requested for ecosystem 
restoration along the Missouri River. We believe it is essential to 
provide this minimum amount because the final fiscal year 2009 
appropriation is significantly below the request and the Corps 
identified approximately $26 million in restoration projects that could 
commence quickly to stimulate local economies, but these were not fully 
funded by the American Recovery and Reinvestment Act. In addition, 
through the Missouri River Recovery Program, the Army Corps has 
identified $105 million in projects, which have been designed and 
approved, that it could implement next fiscal year. With at least $70 
million, the Corps and U.S. Fish and Wildlife Service could begin 
important ecosystem restoration efforts that will produce long-term 
ecological and economic benefits, as well as provide economic stimulus 
throughout fiscal year 2010 by allowing the agencies to move forward 
with shovel-ready projects.
    The Missouri River basin encompasses land in 10 States and covers 
one-sixth of the continental United States. The Missouri, America's 
longest river, is one of the most altered ecosystems on earth. While 
recovery and restoration efforts have begun, much more needs to be 
done. League members, especially those in Iowa, Nebraska and South 
Dakota, want to see the recovery efforts continue and expand.
    The Corps, Fish and Wildlife Service and many State agencies have 
been working on restoring habitat for fish and wildlife species along 
the river. This work is critical for the Interior Least Tern and Pallid 
Sturgeon, which are listed as endangered under the Endangered Species 
Act, and the Piping Plover, which is listed as threatened. Moreover, 
the positive impacts of restoration extend to all fish and wildlife 
throughout the region.
    A recent study conducted by the Fish and Wildlife Service near 
Lisbon Bottoms in Missouri showed that over twice as many fish species 
were utilizing the created shallow water habitat (SWH) areas as the 
main channelized section of the river. A Corps' study has shown that 
the emergent sandbar habitat (ESH) projects have had tremendous 
response from nesting terns and plovers. These habitat restoration 
projects are working with the river--not against it.
    These projects have also been a boon for recreation along portions 
of the river. Anglers, hunters, boaters and others have been using some 
of these areas proving the old adage ``if you build it, they will 
come.'' Although the majority of the population lives in the lower 
basin, most recreational spending is currently occurring in the upper 
basin because facilities and opportunities are more abundant. These 
developed habitat projects are bringing people back to the river in the 
lower Missouri basin.
    In addition to boosting the economy through tourism, restoration 
projects can provide near-term economic stimulus in small communities 
throughout the region. As Congress and the administration considered 
the stimulus package earlier this year, the Corps identified $26 
million in restoration projects that could commence this spring and 
summer in Nebraska, Iowa, South Dakota and other basin States. In 
general, these projects involved removing barriers to fish passage on 
the Yellowstone River in Montana as well as restoring and creating 
habitat for terns, plovers and pallid sturgeon in the middle and lower 
basin. To perform this work, the Corps would contract with local 
construction companies, which would create or maintain jobs and inject 
dollars into the local economy through purchases of materials, fuel, 
food and lodging. Although these projects were not funded by the 
Recovery Act, with an appropriation of at least $70 million, the Corps 
could implement some of them next year. Doing so could help propel 
economic recovery at the community level at a time when we hope the 
national economy will also be improving.
    The League encourages the subcommittee to provide at least $70 
million for recovery and restoration efforts along the Missouri River. 
Benchmarks have been set by the Biological Opinion establishing goals 
for habitat restoration. With adequate funding and a lot of hard work 
on the ground, we can meet these goals and restore critical segments of 
America's longest river.
    We appreciate the opportunity to submit testimony and look forward 
to working with the subcommittee to strengthen the investment in 
ecosystem restoration and recovery along the Upper Mississippi and 
Missouri rivers.
                                 ______
                                 
        Prepared Statement of the Little River Drainage District

    Dear Congressman Visclosky, my name is Dr. Sam M. Hunter, DVM of 
Sikeston, Missouri. I am a veterinarian, landowner, farmer and resident 
of Southeast Missouri.
    I am the President of the Little River Drainage District, the 
largest such entity in the Nation. Our District serves as an outlet 
drainage and flood control District to parts of seven counties in 
Southeast Missouri. We provide flood control protection to a sizable 
area of Northeast Arkansas as well. Our District is solely tax 
supported by more than 3,500 private landowners in Southeast Missouri.
    My remarks will be directed toward the Mississippi River and 
Tributaries Project (MR&T) and the St. Francis River Basin portion of 
the MR&T. Those funds when properly expended are investments yielding a 
return of substantial benefits to the American taxpayer throughout this 
Nation. They are used to prevent flooding to much of our valuable 
farmland, to industrial sites, and to upgrade our ever aging locks and 
dam system on our navigable streams which will prevent unscheduled lock 
closures, modernize our hydro-electric plants, and restore some of our 
environmental assets. MR&T authorized by Congress in 1928 and still not 
completed is returning back to our Nation $25 for every $1 expended. 
What a good investment!!
    We are pleased to learn of the recent passage of the Omnibus bill 
for fiscal year 2009 and the Stimulus bill. The Omnibus bill provides 
$375 million for the MR&T Project for fiscal year 2009. The stimulus 
funding will likewise provide additional funds to improve much needed 
work on this excellent project. The Corps has a stated capability 
exceeding both amounts and will be able to execute those funds 
promptly.
    Many jobs will be realized and many products will be purchased 
throughout the entire Mississippi Valley and the watershed which 
discharge into this system. We must put people back to work and this 
should help in some small way. However, there still remains room for 
more funding. This District supports the request of the Mississippi 
Valley Flood Control Association for funding levels at $500 million for 
the MR&T Project. This project as well as all of the subsidiary 
projects within are returning back to the U.S. Treasury a minimum of $6 
for each $1 invested.
    We believe Congress needs to intervene and reverse the trend of 
OMB, and of past administrations. We have not seriously invested in our 
waterway infrastructure for decades but we MUST. Local economies will 
be affected positively by these investments. Local labor will be used 
as well as local businesses who will provide needed materials. This 
would be a major boost to our economy. Each year OMB and recent 
administrations have submitted low budget amounts for this worthwhile 
project and we have had to rely on Congress to ``fix'' the problem. You 
should not be burdened with this task. Someone needs to inform OMB what 
projects need funding which are assets to our Nation and not a 
liability.
    We must prioritize projects and eliminate projects that are not 
returning benefits back to this Nation. We must have our Federal 
Government live up to the commitments they have made to the citizens of 
this Nation. Private interests have made many investments based upon 
faith in the Federal Government following through on what it promised 
and what they had been told would be provided to them within a 
reasonable period of time. If a project is to be funded entirely by the 
Federal Government as directed by Congress then we must fulfill that 
obligation. If local interest is to provide a portion of the cost then 
local interest must meet that mandate as well. However, we do not need 
to hold any projects up because local interests are not financially 
able to meet their cost sharing needs provided that project returns a 
benefit back to this Nation. Let us move forward with a plan and let us 
work that plan and rebuild and bring our waterway infrastructure into 
the 21st century properly.
    Investing in our waterways is a great way to stimulate the economy, 
which currently is very much needed, and at the same time be building 
and making investments into a system for the future which will return 
back more dollars than expended. We petition you to give this vital 
industry of our Nation a strong endorsement and do all you can to 
ensure our waterways system and carriers stay competitive with our 
foreign competitors.
    I have the following comments for your benefit and consideration:

                         STIMULUS BILL FUNDING

    The Corps stated a capability to execute $12-$15 billion yet were 
only allocated $4.6 billion. This amount is gratefully appreciated but 
is a mere ``down payment'' to improve and upgrade our deteriorated 
infrastructure. Thousands of jobs could be generated should the Corps 
capability be met. The Corps continues the premier engineering and 
construction arm of the Federal Government. We need to let them do what 
they do best.

                             INFRASTRUCTURE

    The current administration stated often during its campaign and 
after that a genuine concerted priority would be to invest in this 
country's future, namely, its infrastructure.
    Our Federal road systems are crumbling! We must not wait for 
bridges to fail before we act. We need to move forward across our 
entire Nation upgrading our Federal highway system in its entirety. 
This will take long term commitments not just a ``stimulus'' now and 
then. We need to put a plan in place, work the plan and fund it 
properly.
    Are we truly interested in fuel independence--a cleaner 
environment--a better economy? If we are why don't we have someone step 
forward and be a champion for our ``waterways'' system? We have locks 
and dams which are an average of 50 years old. Parts are having to be 
fabricated since they are no longer manufactured. Tows are having to be 
broken up to pass because our locks and dams are too short and not 
modernized. Many undue delays are occurring. This does not permit our 
carriers to compete fairly with the foreign shipping industry. We must 
start a concerted effort to improve this part of our Nation's 
infrastructure.
    Locks, dams, hydropower, recreation, flood control, water supplies 
and all other benefits from the construction, operation and maintenance 
of these features on our rivers benefit our entire Nation not just a 
few. It is a national asset and it must be operated and funded as a 
national benefit. Private industry can not and will not operate this 
system fairly and in the best interest of our Nation.
    Environmentally moving goods and freight throughout our Nation via 
water is much cleaner, less intrusive and far more environmentally 
acceptable than highways or rail. Noise pollution, air pollution, land 
pollution are substantially less when we move the mass amount of goods 
possible by water.
    Fuel efficiency comparison is a ``no brainer''! For instance 1 
gallon of fuel moves 155 tons of freight by truck, 413 tons of freight 
by rail and 576 tons of freight by water. What part of this do we not 
understand? Why can't we realize such an endeavor would reduce much of 
our fuel needs and take much pressure off our highway system?
    Economically investing wisely in our waterways effects much of our 
Nation--not just a regional portion. Consider it being possible to 
board a waterborne vessel at the Port of New Orleans, Louisiana and one 
can touch 36 States of this Nation and 6 provinces in Canada without 
ever getting onto land. Over 75 percent of our population lives along 
water. Only two of our major cities are not on water, namely, Atlanta, 
Georgia and Denver, Colorado. With the many ports throughout the 
Mississippi Valley, which network many more people inland, it is 
evident many local economies will be benefitted when investments are 
made in our water infrastructure.
    We seem to be ready, willing and capable of improving the 
infrastructure of other Nations at the expense of our taxpayers but 
seem reluctant to do the same for our Nation. It is far past time to 
reward the American taxpayer with a return for the money he provides 
each year and stop using those funds to benefit those Nations who are 
our enemies.
    It has been estimated our waterway infrastructure needs $100-$120 
billion to modernize, upgrade and be made functional. Lets start now by 
setting a 10 year goal to modernize that system and then plan to meet 
that goal and exceed same when possible. Currently we are spending $13-
$15 billion per month to fight terrorism in Iraq and Afghanistan which 
is more spent in 1 year of what is needed to bring our waterways up to 
a finished plan. Perhaps we could cut the 10 year plan to even 5 years 
by eliminating much of that funding. Lets try!
    I wish to thank you very much for your time and kind attention and 
for taking the time to review the above. We would be very appreciative 
of anything this subcommittee can do to help us improve our 
environment, improve our livelihood, and improve the area in which we 
live and work which ultimately is good for America. We are also very 
appreciative of all this subcommittee has done for us in the past. We 
trust you will hear our pleas once more and act accordingly.
                                 ______
                                 
  Prepared Statement of Mayor Sara Presler, City of Flagstaff, Arizona

    Chairman Dorgan, Ranking Member Bennett, and distinguished members 
of the subcommittee, thank you for allowing me to testify on behalf of 
the city of Flagstaff, Arizona in support of $23 million in the Army 
Corps of Engineers budget for the Rio de Flag flood control project in 
fiscal year 2010. The Rio de Flag flood control project is critically 
important to the city, to northern Arizona, and, ultimately, to the 
Nation.
    As you may know, Mr. Chairman, with this subcommittee's help over 
the last several fiscal years, Rio de Flag received more than $15 
million to continue construction on this important project. We are 
extremely grateful that the subcommittee boosted this project well 
above the President's request every year, and we would appreciate your 
continued support for this project in fiscal year 2010.
    Furthermore, the amount of money invested in this project by the 
Federal Government--approximately $54 million (authorized by WRDA)--
will be saved exponentially in costs to the Federal Government in the 
case of a large and catastrophic flood, which could be more than $450 
million. It will also promote economic growth and redevelopment along 
areas that are currently underserved because of the flood potential.
    Like many other projects under the Army Corps's jurisdiction, Rio 
de Flag received no funding in the President's fiscal year 2010 budget, 
although the Corps has expressed a capability of $23 million to 
continue construction on the project and unwavering commitment to the 
project. We are hopeful that the subcommittee will fund the Rio de Flag 
project at $23 million when drafting its bill in order to keep the 
project on an optimal schedule.
    Flooding along the Rio de Flag dates back as far as 1888. The Army 
Corps has identified a Federal interest in solving this long-standing 
flooding problem through the Rio de Flag, Flagstaff, Arizona--
Feasibility Report and Environmental Impact Study (EIS). The 
recommended plan contained in this feasibility report was developed 
based on the following opportunities: (1) flood control and flood 
damage reduction; (2) environmental mitigation and enhancement; (3) 
water resource management; (4) public recreation; and (5) redevelopment 
opportunities. This plan will result in benefits to not only the local 
community, but to the region and the Nation.
    The feasibility study by the Corps of Engineers has revealed that a 
500-year flood could cause serious economic hardship to the city. In 
fact, a devastating 500-year flood could damage or destroy 
approximately 1,500 structures valued at more than $450 million. 
Similarly, a 100-year flood would cause an estimated $100 million in 
damages. In the event of a catastrophic flood, over half of Flagstaff's 
population of more than 60,000 would be directly impacted or affected.
    In addition, a wide range of residential, commercial, downtown 
business and tourism, and industrial properties are at risk. Damages 
could also occur to numerous historic structures and historic Route 66. 
The Burlington Northern & Santa Fe Railway (BNSF), one of the primary 
east-west corridors for rail freight, could be destroyed, as well as 
U.S. Interstate 40, one of the country's most important east-west 
interstate links. Additionally, a significant portion of Northern 
Arizona University (NAU) could incur catastrophic physical damages, 
disruptions, and closings. Public infrastructure (e.g., streets, 
bridges, water, and sewer facilities), and franchised utilities (e.g., 
power and telecommunications) could be affected or destroyed. 
Transportation disruptions could make large areas of the city 
inaccessible for days.
    Mr. Chairman, the intense wildfires that have devastated the West 
during the last several years have only exacerbated the flood potential 
and hazard in Flagstaff. An intense wildfire near Flagstaff could strip 
the soil of ground cover and vegetation, which could, in turn, increase 
runoff and pose an even greater threat of a catastrophic flood.
    In short, a large flood could cripple Flagstaff for years. This is 
why the city believes it is important to ensure that this project 
remains on schedule and that the Corps is able to utilize its expressed 
capability of $23 million in fiscal year 2010 for construction of this 
flood control project.
    In the city's discussions with the Corps, both the central office 
in Washington and its Los Angeles District Office also believe that the 
Rio de Flag project is of the utmost importance and both offices 
believe the project should be placed high on the subcommittee's 
priority list. We are hopeful that the subcommittee will consider this 
advice and also place the project high on its priority list and fully 
fund the project at $23 million for fiscal year 2010.
    It is important to note that the city has secured the necessary 
property rights to begin construction, and the city is prepared to 
assume the costs for the non-Federal portion of the cost-sharing 
agreement.
    The city of Flagstaff, as the non-Federal sponsor, is responsible 
for all costs related to required Lands, Easements, Rights-of-Way, 
Relocations, and Disposals (LERRD's). The city has already secured the 
necessary property rights to begin construction in 2004. Implementation 
of the city's Downtown and Southside Redevelopment Initiatives ($100 
million in private funds) are entirely dependent on the successful 
completion of the Rio de Flag project. The Rio de Flag project will 
also provide a critical missing bike/pedestrian connection under Route 
66 and the BNSF Railroad to replace the existing hazardous at grade 
crossings.
    Mr. Chairman, the Rio de Flag project is exactly the kind of 
project that was envisioned when the Corps was created because it will 
avert catastrophic floods, it will save lives and property, and it will 
promote economic growth. In short, this project is a win-win for the 
Federal Government, the city, and the surrounding communities.
    In conclusion, the Rio de Flag project should be considered a high 
priority for this subcommittee, and I encourage you to support full 
funding of $23 million for this project in the fiscal year 2010 Energy 
and Water Development Appropriations bill. Thank you in advance for 
your consideration.
                                 ______
                                 
   Prepared Statement of the Board of Mississippi Levee Commissioners

    Mr. Chairman and members of the subcommittee, this statement is 
prepared by Peter Nimrod, Chief Engineer for the Board of Mississippi 
Levee Commissioners, Greenville, Mississippi, and submitted on behalf 
of the Board and the citizens of the Mississippi Levee District. The 
Board of Mississippi Levee Commissioners is comprised of seven elected 
commissioners representing the counties of Bolivar, Issaquena, Sharkey, 
Washington, and parts of Humphreys and Warren counties in the Lower 
Yazoo Basin in Mississippi. The Board of Mississippi Levee 
Commissioners is charged with the responsibility of providing 
protection to the Mississippi Delta from flooding of the Mississippi 
River and maintaining major drainage outlets for removing the flood 
waters from the area. These responsibilities are carried out by 
providing the local sponsor requirements for the congressionally 
authorized projects in the Mississippi Levee District. The Mississippi 
Levee Board and the Mississippi Valley Flood Control Association 
support an appropriation of $500 million for fiscal year 2010 for the 
Mississippi River and Tributaries Project. This is the minimum amount 
that we consider necessary to allow for an orderly completion of the 
remaining work in the Valley and to provide for the operation and 
maintenance, as required, to prevent further deterioration of the 
completed flood control and navigation work.
    It is apparent that the administration loses sight of the fact that 
the Mississippi River and Tributaries Project provides protection to 
the Lower Mississippi Valley from waters generated across 41 percent of 
the Continental United States. These waters flow from 31 states and 2 
provinces of Canada and must pass through the Lower Mississippi Valley 
on its way to the Gulf of Mexico. We will remind you that the 
Mississippi River and Tributaries Project is one of, if not the most 
cost effective project ever undertaken by the United States Government. 
The foresight of the Congress in their authorization of the many 
features of this project is exemplary.
    The many projects that are part of the Mississippi River and 
Tributaries Project not only provide protection from flooding in the 
area, but the award of construction contracts throughout the Valley 
provides assistance to the overall economy of this area. The employment 
of the local workforce and purchases from local vendors by the 
contractors help stabilize the economy in one of the most impoverished 
areas of our country.
    Thanks to the additional funding provided by the Congress over the 
last several years over and above the administration's budget, work on 
the Mainline Mississippi River Levee Enlargement Project is continuing. 
Of the original 69 miles of deficient levees in the Mississippi Levee 
District, 23.2 miles of work has been completed, 12.2 miles are 
currently under contract, and another 4.7 miles will be awarded in late 
Summer, 2009. We are requesting $69.972 million for construction on the 
Mainline Mississippi River Levees in the Lower Mississippi Valley 
Division which will allow the Vicksburg and Memphis districts to keep 
existing contracts on schedule and award contracts to avoid any future 
unnecessary delays in completing this vital project. We are all well 
aware that the Valley some day will have to endure a Project Flood, we 
just don't know when. We must be prepared.
    The President's fiscal year 2010 budget did not include funding for 
any construction projects within the Yazoo Basin. This action is 
especially difficult to understand during a time when our Nation needs 
an economic boost. These are all projects authorized and funded so 
wisely by the Congress. All of these projects are encompassed in the 
footprint of the Delta Regional Authority, an area recognized by the 
Congress as requiring special economic assistance to keep pace with the 
rest of our great Nation. We can not lose sight of the fact that all of 
these projects are required to return more than a dollar in benefits 
for each dollar spent.
    The Final Report for the Yazoo Backwater Project was released in 
late 2007. The Yazoo Backwater Project will provide economic and 
environmental benefits to parts of six counties in the south 
Mississippi Delta. This project will build a pump that will evacuate 
floodwater that is generated over 4,093 square miles in the Mississippi 
Delta. The pump will lower the 100-year flood event by 4.5 feet thereby 
reducing urban and rural structural damages, providing benefits to the 
remaining agricultural lands, and reducing the frequency and duration 
of floods. Reforestation easements will be purchased on up to 55,600 of 
existing agricultural land which will provide benefits in every 
environmental category--wetlands, terrestrial, aquatics, and waterfowl 
resources as well as vastly improving water quality. The recommended 
plan for the Yazoo Backwater Project will balance economics with the 
environment. This is a model project that should be the standard for 
future public works projects in the United States. On August 31, 2008, 
EPA wrongly used it's authority under section 404(c) of the Clean Water 
Act (CWA) to veto the Yazoo Backwater Project even though it is exempt 
by section 404(r) of the CWA. We are requesting this project be funded 
by the Congress in the amount of $5 million. These funds will allow the 
Corps to begin acquisition of the reforestation easements and initiate 
the award of the pump supply contract.
    The Draft Supplemental Environmental Impact Statement for the Big 
Sunflower River Maintenance Project will be released next year. This 
maintenance project will restore flood control capacities to 130 miles 
of channels by removing sediment that has built up over the past 40 
years since the channels were originally improved. Our request for 
$5.591 million will allow right-of-way acquisition to continue and for 
the award of the first dredging contract. The residents in the 
Mississippi Delta continue to suffer damages from flooding while they 
wait for this maintenance project to reach their area.
    Work on the Delta Headwaters Project has proven effective in 
reducing sediments to downstream channels. To discontinue this project 
will only diminish water quality by increasing sediment, reducing the 
level of protection to the citizens of the Delta and increasing 
required maintenance. We are requesting $25 million to continue this 
project.
    The Upper Yazoo Project is critical to the Delta. The Corps of 
Engineers operates four major flood control reservoirs on the bluff 
hills overlooking the Mississippi Delta. These reservoirs hold back 
heavy spring rains and must have adequate outlet channel capacity to 
pass this excess runoff during the summer and fall months. Without 
completion of the Upper Yazoo Project, the Corps is forced to hold 
flood water from the previous spring, thereby reducing the ability to 
provide protection from the current year's flood water. We urge the 
Congress to provide $24.5 million allowing construction to continue and 
the award of additional channel enlargement items.
    Maintenance of completed works can not be over looked. The four 
flood control reservoirs over looking the Delta have been in place for 
50 years and have functioned as designed. Required maintenance must be 
performed to avoid any possibility of failure during a flood event. We 
are asking for $13.793 million for Arkabutla Lake, $12.69 million for 
Enid Lake, $13.231 million for Grenada Lake, and $14.483 million for 
Sardis Lake.
    We are requesting $13.522 million for Maintenance of the Mainline 
Mississippi River Levees in the Lower Mississippi Valley Division which 
will provide for repair of levee slides, slope repair, and repair of 
the gravel maintenance roadway which is so vital to access during high 
water.
    The Environmental Protection Agency (EPA) has been given too much 
power under section 404(c) of the Clean Water Act (CWA) which allows 
EPA to veto Congressionally authorized projects. During the early 
1990s, due to abuse of the 404(c) power by EPA, Congress considered 
removing this authority from EPA. EPA has again invoked this veto power 
on the Yazoo Backwater Project. EPA is saying that you can't lower the 
water level with a flood control project! By killing this project with 
404(c) veto authority, EPA is drawing a line in the sand over the 
future of flood control in our great Nation. EPA has vetoed the Yazoo 
Backwater Project even though it was approved, authorized and funded by 
Congress and exempt from a 404(c) veto by 404(r). It is now time to 
again take up this issue and remove the 404(c) veto power from EPA 
before they kill another flood control project that has been authorized 
by Congress.
    As Members of the Congress representing the citizens of our Nation 
who live with the Mississippi River everyday, you clearly understand 
both the benefits provided by this resource, and the destructive force 
that must be controlled during a flood. On behalf of the Mississippi 
Levee Board, I can not express enough, our appreciation for your 
efforts in providing adequate funding over the last several years that 
has allowed construction to continue on our much needed projects and 
thank you in advance for your kind consideration of our requests for 
fiscal year 2010.
                                 ______
                                 

                       DEPARTMENT OF THE INTERIOR

                         Bureau of Reclamation

   Prepared Statement of Dave Freudenthal, Governor, State of Wyoming

    Dear Chairman Dorgan and Senator Bennett, I am requesting your 
support for an appropriation of $3,569,000 to the Bureau of Reclamation 
included in the President's fiscal year 2010 recommended budget in the 
Upper Colorado Region budget line item entitled ``Endangered Species 
Recovery Implementation Program.'' This budget line-item designates 
$1,950,000 for construction and construction management activities for 
the San Juan River Basin Recovery Implementation Program; $1,219,000 
for construction and construction management activities for the Upper 
Colorado River Endangered Fish Recovery Program; and $400,000 for Fish 
and Wildlife Management and Development activities to avoid jeopardy.
    The Upper Colorado and San Juan recovery programs' objectives are 
to recover endangered fish species while water use and development 
proceeds in compliance with the Federal Endangered Species Act. Since 
1988, these programs have provided ESA section 7 compliance (without 
litigation) for nearly 1,800 Federal, tribal, State and privately 
managed water projects depleting more than 3 million acre-feet of water 
per year. These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. Substantial non-Federal cost-sharing funding 
exceeding 50 percent is embodied in both programs.
    The Department of the Interior recognized these programs with the 
Department of the Interior's Cooperative Conservation Award in April 
2008 as national model efforts demonstrating that collaborative 
conservation partnerships can successfully work to recover endangered 
species while addressing water needs to support growing western 
communities in a manner that fully respects State water law and 
interstate river compacts.
    We request the subcommittee's assistance for fiscal year 2010 
funding to ensure the Bureau of Reclamation's continuing financial 
participation, as authorized and directed by Public Law 106-392, as 
amended, in these two region-wide cooperative recovery programs. The 
State of Wyoming thanks you for the past support and assistance of your 
subcommittee; it has greatly facilitated the success of these multi-
state, multi-agency programs.
                                 ______
                                 
  Prepared Statement of Jon M. Huntsman, Jr., Governor, State of Utah

    Dear Chairman Dorgan and Senator Cochran, this letter serves to 
respectfully request your support for an appropriation of $3,569,000 to 
the Bureau of Reclamation included in the President's fiscal year 2010 
recommended budget in the Upper Colorado Region budget line item 
entitled ``Endangered Species Recovery Implementation Program,'' This 
budget line-item designates $1,950,000 for construction and 
construction management activities for the San Juan River Basin 
Recovery Implementation Program; $1,219,000 for construction and 
construction management activities for the Upper Colorado River 
Endangered Fish Recovery Program; and $400,000 for Fish and Wildlife 
Management and Development activities to avoid jeopardy.
    The Upper Colorado and San Juan recovery programs' objectives are 
to recover endangered fish species while water use and development 
proceeds in compliance with the Federal Endangered Species Act. Since 
1988, these programs have provided ESA section 7 compliance (without 
litigation) for neatly 1,800 Federal, tribal, State and privately 
managed water projects depleting more than 3 million acre-feet of water 
per year. These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power, and 
environmental interests. Substantial non-Federal cost-sharing funding 
exceeding 50 percent is embodied in both programs.
    The Department of the Interior recognized these programs with the 
DOI's Cooperative Conservation Award in April 2008 as national model 
efforts demonstrating that collaborative conservation partnerships can 
successfully work to recover endangered species while addressing water 
needs to support growing western communities in a manner that fully 
respects State water law and interstate river compacts.
    Utah requests the subcommittee's assistance for fiscal year 2010 
funding to ensure the Bureau of Reclamation's continuing financial 
participation as authorized and directed by Public Law 106-392, as 
amended, in these two region-wide cooperative recovery programs. On 
behalf of the State of Utah, I thank you for the past support and 
assistance of your subcommittee; it has greatly facilitated the success 
of these multi-state, multi-agency programs.
                                 ______
                                 
  Prepared Statement of Bill Richardson, Governor, State of New Mexico

    Dear Chairman Dorgan and Senator Cochran, I am requesting. your 
support for an appropriation of $3,569,000 to the Bureau of Reclamation 
included in the President's fiscal year 2010 recommended budget in the 
Upper Colorado Region budget line item entitled ``Endangered Species 
Recovery Implementation Program.'' This budget line-item designates 
$1,950,000 for construction and construction management activities for 
the San Juan River Basin Recovery Implementation Program; $1,219,000 
for construction and construction management activities for the Upper 
Colorado River Endangered Fish Recovery Program: and $400,000 for Fish 
and Wildlife Management and Development activities to avoid jeopardy.
    The requested fiscal year 2010 appropriation for to San Juan River 
Recovery Program will be used for construction of critically needed 
fish passage structures in critical habitat on the San Juan River as 
well as providing for program management and development.
    The Upper Colorado and San Juan recovery programs' objectives are 
to recover endangered fish species while water use and development 
proceeds in compliance with the Federal Endangered Species Act. Since 
1988, these programs have provided ESA section 7 compliance (without 
litigation) for nearly 1,800 Federal, tribal, State and privately 
managed water projects depleting more than 3 million acre-feet of water 
per year. These highly successful cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. Substantial non-Federal cost-sharing funding 
exceeding 50 percent is embodied in both programs.
    The Department of the Interior recognized these programs with the 
Department of the Interior's Cooperative Conservation Award in April 
2008 as national model efforts demonstrating that collaborative 
conservation partnerships can successfully work to recover endangered 
species while addressing water needs to support growing western 
communities in a manner that fully respects State water law and 
interstate river compacts.
    We request the subcommittee's assistance for fiscal year 2010 
funding to ensure the Bureau of Reclamation's continuing financial 
participation, as authorized and directed by Public Law 106-392, as 
amended, in these two region wide cooperative recovery programs. The 
State of New Mexico thanks you for the past support and assistance of 
your subcommittee; it has greatly facilitated the success of these 
multi-state, multi-agency programs.
                                 ______
                                 
  Prepared Statement of Bill Ritter,. Jr., Governor, State of Colorado

    Dear Chairman Dorgan and Senator Bennett, I am requesting your 
support for an appropriation of $3,569,000 to the Bureau of Reclamation 
included in the President's fiscal year 2010 recommended budget in the 
Upper Colorado Region budget line item entitled ``Endangered Species 
Recovery Implementation Program.'' This budget line-item designates 
$1,950,000 for construction and construction management activities for 
the San Juan River Basin Recovery Implementation Program; $1,219,000 
for construction and construction management activities for the Upper 
Colorado River Endangered Fish Recovery Program; and $400,000 for Fish 
and Wildlife Management and Development activities to avoid jeopardy.
    These programs are long-standing partnerships among the States of 
Colorado, New Mexico, Utah and Wyoming, Indian tribes, Federal 
agencies, and water, power and environmental interests. These programs 
are successful and collaborative efforts that merit continued support 
by the Federal Government as a model method to recover threatened and 
endangered species, while allowing water development to occur in a 
manner that complies with the Endangered Species Act.
    The Department of the Interior recognized these programs with the 
Department of the Interior's Cooperative Conservation Award in April 
2008 as national models demonstrating that collaborative conservation 
partnerships can successfully work to recover endangered species while 
addressing water needs to support growing western communities in a 
manner that fully respects State water law and interstate river 
compacts. Since 1988, these programs have provided ESA compliance 
(without litigation) for nearly 1,800 Federal, tribal, State and 
privately managed water projects depleting more than 3 million acre-
feet of water per year. Substantial non-Federal cost-sharing funding 
exceeding 50 percent is embodied in both of these programs as 
authorized by Public Law 106-392, as amended.
    The past support and assistance of your subcommittee has greatly 
facilitated the success of these multi-state, multi-agency programs. On 
behalf of the State of Colorado, I thank you for that support and I 
request the subcommittee's assistance, for fiscal year 2010 funding, to 
ensure the Bureau of Reclamation's continuing and vitally important 
financial participation in these regional cooperative recovery 
programs.
                                 ______
                                 
       Prepared Statement of the Wyoming Water Association (WWA)

    Dear Chairman Dorgan and Senator Bennett, on behalf of the members 
of the Wyoming Water Association, I am requesting your support for an 
appropriation in the President's recommended budget for fiscal year 
2010 of $3,569,000 to the Bureau of Reclamation within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region. The funding designation I seek is as 
follows: $1,219,000 for construction activities for the Upper Colorado 
River Endangered Fish Recovery Program; $1,950,000 for construction 
activities for the San Juan River Basin Recovery Implementation 
Program; and $400,000 for Fish and Wildlife Management and Development 
activities to avoid jeopardy. This funding is authorized by Public Law 
106-392, as amended, and is included in the President's recommended 
budget for fiscal year 2010 within the Bureau of Reclamation's 
``Endangered Species Recovery Implementation Program'' budget line-
item.
    Founded in 1933, the Wyoming Water Association (WWA) is a Wyoming 
non-profit corporation and voluntary organization of private citizens, 
elected officials, and representatives of business, government 
agencies, industry and water user groups and districts. The 
Association's objective is to promote the development, conservation, 
and utilization of the water resources of Wyoming for the benefit of 
Wyoming people. The WWA provides the only statewide uniform voice 
representing all types of water users within the State of Wyoming and 
encourages citizen participation in decisions relating to multi-purpose 
water development, management and use.
    The Wyoming Water Association is a participant in the Upper 
Colorado River Endangered Fish Recovery Program. That program, and its 
sister program within the San Juan River Basin, are ongoing 
partnerships among the States of Colorado, New Mexico, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Federal Endangered Species Act. The Department of 
the Interior continues to recognize these programs as national models 
demonstrating that collaboratively partnerships can successfully work 
to recover endangered species while addressing water needs to support 
growing western communities in a manner that fully respects State water 
law and interstate compacts. Since 1988, these programs have provided 
ESA section 7 compliance (without litigation) for over 1,600 Federal, 
tribal, State and privately managed water projects depleting more than 
3 million acre-feet of water per year.
    The requested fiscal year 2010 appropriation will allow the San 
Juan River Recovery Implementation Program to complete a fish passage 
facility on the San Juan River and to initiate planning and design for 
a proposed similar structure in a following year. The funding for the 
Upper Colorado Recovery Program will be used for pre-construction 
efforts prior to the anticipated award of a contract in fiscal year 
2011 to construct a fish screen to avoid entrapment and a water 
conservation and canal automation project to provide additional water 
supplies for the endangered fishes. Substantial non-Federal cost-
sharing funding exceeding 50 percent is being provided for the capital 
construction projects benefiting the endangered fish and their habitats 
associated with both of these successful programs.
    The past support and assistance of your subcommittee has greatly 
facilitated the success of these multi-state, multi-agency programs. On 
behalf of the members of the Wyoming Water Association, thank you for 
that support. We again request the subcommittee's assistance, with 
regard to fiscal year 2010 funding, to ensure the Bureau of 
Reclamation's continuing financial participation in these vitally 
important programs.
                                 ______
                                 
          Prepared Statement of the Southern Ute Indian Tribe

    Dear Chairman Dorgan and Senator Bennett, on behalf of the Southern 
Ute Indian Tribe, I am requesting your support for an appropriation in 
the President's recommended budget for fiscal year 2010 of $3,569,000 
to the Bureau of Reclamation (``Reclamation'') within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region. The funding designation the Tribe seeks 
on behalf of Reclamation is as follows: $1,219,000 for construction 
activities for the Upper Colorado River Endangered Fish Recovery 
Program; $1,950,000 for construction activities for the San Juan River 
Basin Recovery Implementation Program; and $400,000 for Fish and 
Wildlife Management and Development activities to avoid jeopardy. This 
funding is authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, the Southern Ute Indian Tribe, the Ute Mountain Ute Indian 
Tribe, the Navajo Nation, and the Jicarilla Apache Nation, Federal 
agencies and water, power and environmental interests. The programs' 
objectives are to recover endangered fish species while water use and 
development proceeds in compliance with the Endangered Species Act.
    The tribe appreciates the subcommittee's past support and requests 
the subcommittee's assistance for fiscal year 2010 funding to ensure 
Reclamation's continuing financial participation in these vitally 
important programs.
                                 ______
                                 
  Prepared Statement of the Fort Peck Reservation Rural Water System 
(Public Law 106-382), Assiniboine and Sioux Rural Water System, and the 
                     Dry Prairie Rural Water System

                         BUREAU OF RECLAMATION

Fiscal Year Budget Request
    The Fort Peck Assiniboine and Sioux Tribes and Dry Prairie Rural 
Water respectfully request fiscal year 2010 appropriations of 
$44,649,000 for the Bureau of Reclamation rural water program. The 
project is 22 percent complete. It has progressed well subject to 
available funds.
    Fiscal year 2010 funds will be used to construct critical elements 
of the Fort Peck Reservation Rural Water System, Montana, (Public Law 
106-382, October 27, 2000). The amount requested is based on need to 
build Phase II of the regional water treatment plant, pipelines to 
connect with the Town of Poplar and Dry Prairie systems on the east and 
west sides project. The request is within capability to spend funds in 
fiscal year 2010 and is set out in Table 1. The Schedule of Activities 
and Cash Flow analysis to build the major features of the regional 
system (water treatment plant and common pipelines) is included as 
Attachment A and demonstrate capability to use funds.

    TABLE 1.--FISCAL YEAR 2010 FUNDING REQUEST FORT PECK RESERVATION RURAL WATER SYSTEM (PUBLIC LAW 106-382)
----------------------------------------------------------------------------------------------------------------
                         Project Feature                              Federal       Non-Federal        Total
----------------------------------------------------------------------------------------------------------------
                        Fort Peck Tribes

Water Treatment Plant:
    Phase I, Clear Well Wash Water Recovery.....................  ..............  ..............  ..............
    Phase II, Main Treatment....................................     $20,317,000  ..............     $20,317,000
Pipelines:
    Water Treatment Plant to Poplar.............................      10,763,000  ..............      10,763,000
    Water Treatment Plant to Wolf Point.........................  ..............  ..............  ..............
FP OM Buildings.................................................         558,000  ..............         558,000
                                                                 -----------------------------------------------
      Subtotal..................................................      31,638,000  ..............      31,638,000
                                                                 ===============================================
                           Dry Prairie

Big Muddy to Plentywood.........................................       4,739,000      $1,496,000       6,235,000
Fort Kipp.......................................................         219,000          69,000         288,000
Porcupine Creek to Opheim:
    St. Marie to Nashua.........................................       4,619,000       1,458,000       6,077,000
    St. Marie to Opheim.........................................       3,434,000       1,084,000       4,518,000
                                                                 -----------------------------------------------
      Subtotal..................................................      13,011,000       4,107,000      17,118,000
                                                                 ===============================================
      Total.....................................................      44,649,000       4,107,000      48,756,000
----------------------------------------------------------------------------------------------------------------

Funding Status and Needs
    As shown in Table 2 below, the project will be 22 percent complete 
at the end of fiscal year 2009. Construction funds remaining to be 
spent after fiscal year 2009 will total $225.061 million within the 
current authorization (in October 2008 dollars). Administrative costs 
of extending the project completion to fiscal year 2015 and 
construction costs outside the authorized ceiling increase remaining 
costs to $245.969 million before considering inflation. Inflation at 
7.5 percent over the next 6 years, the average rate over the last 5 
years in Reclamation construction projects, is expected to increase 
remaining project costs to $314.001 million if the project is completed 
in fiscal year 2015. An average $52.33 million annually is required to 
complete the project by 2015 considering all factors. The project is 
seeking an amendment of Public Law 106-382 in this session of Congress 
to extend the project completion to December 31, 2015.

                   TABLE 2.--FUNDING STATUS AND NEEDS
------------------------------------------------------------------------

------------------------------------------------------------------------
Total Federal Funding Authority (October 2008 $)........    $289,110,000
Federal Funds Expended Through Fiscal Year 2009.........     $64,049,000
Percent Complete........................................           22.15
Amount Remaining After Fiscal Year 2009:
    Total Authorized (October 2008 $)...................    $225,061,000
    Overhead Adjustment for Extension to Fiscal Year        $245,969,000
     2015 and Other.....................................
    Adjusted for Inflation to Fiscal Year 2015 at 7.46      $314,001,000
     Percent Annually...................................
Years to Complete.......................................               6
Average Annual Required to End in Fiscal Year 2015 (Need     $52,333,000
 Extension of Public Law 106-382).......................
Fiscal Year 2010 Amount Requested.......................     $44,649,000
------------------------------------------------------------------------

    The request ($44.649 million) is less than the average annual 
appropriations needed to complete the project in fiscal year 2015 
($52.333 million annually), and is within the capability of the project 
to use funds for construction. The request will create an estimated 350 
full-time equivalent (FTE) construction jobs in an area of Montana with 
low per capita income and high unemployment.
    Cost indexing from fiscal year 1998 reflecting inflation increased 
the cost of the project from $176 million to $289 million, an increase 
of $113 million. (See Attachment D). Increases in the level of 
appropriations are needed to outpace inflation, which averaged 3.35 
percent for pipelines in the first 5 years of the project, 7.46 percent 
over the last 5 years and 13.80 percent last year.
Funding Has Not Been Adequate to Serve Any Tribal Users
    The sponsor tribes and Dry Prairie greatly appreciate the previous 
appropriations from the subcommittee that have permitted building the 
Missouri River intake (the water source), stages of the water treatment 
plant in multiple contracts, the Culbertson to Medicine Lake pipeline 
and branches serving rural users outside the Fort Peck Indian 
Reservation. However, funds have not been adequate to complete the 
water treatment plant, pipeline to Poplar and other features as 
proposed for fiscal year 2010. Service to tribal users and communities 
within the Fort Peck Indian Reservation is dependent upon completion of 
those facilities and has not been possible. No water has been delivered 
on the Fort Peck Indian Reservation.
Proposed Activities
    Public Law 106-382 (October 27, 2000) authorized the project, which 
includes all of the Fort Peck Indian Reservation in Montana and the Dry 
Prairie portion of the project outside the Reservation in Roosevelt, 
Sheridan, Daniels and part of Valley County.
            Fort Peck Indian Reservation
    On the Fort Peck Indian Reservation the tribes have used 
appropriations from previous years to:
  --Construct the Missouri River raw water intake, a critical feature 
        of the regional water project. The raw water pump station has 
        been constructed, and the raw water pipeline between the 
        Missouri River and the water treatment plant has been 
        constructed to within 2 miles of the water treatment plant.
  --The sludge lagoons at the water treatment plant have been 
        completed.
  --Phase I of the regional water treatment plant is under construction 
        and will be completed in fiscal year 2009 with funds 
        appropriated previously.
    The regional water treatment plant was divided into three 
construction phases over the past several years. This segregation of 
the project in smaller contracts increased the cost of the project 
significantly but was necessary due to inadequate funding to bid the 
project as a single unit, which would normally be the case. Rather than 
one contractor, there will ultimately be three contractors. Three sets 
of plans and specifications were required to coordinate new 
construction contracts with pieces already built. The Bureau of 
Reclamation approved the plans and specifications for the entire plant 
4 years ago. Capability to use funds has not been an issue.
    The remaining phase of the water treatment plant has been 
advertised for construction in contemplation of adequate funding in 
fiscal year 2010 ($20.317 million) to complete this essential component 
of the project. The bid opening is scheduled for April 7, 2009. 
American Recovery and Reinvestment Act (ARRA) of 2009 funds would 
offset the requirement for fiscal year 2010 appropriations. The project 
clearly meets the expectation of Congress for ARRA, but at the time of 
this writing, the availability of ARRA funds was not known.
    The request for fiscal year 2010 includes funds for construction of 
the essential pipelines from the water treatment plant to the community 
of Poplar (but not to Wolf Point). The pipeline to Poplar is a regional 
transmission pipeline east of the water treatment plant to serve the 
Fort Peck Indian Reservation and to eventually connect to Dry Prairie 
facilities east of the Reservation. The tribes will have capability to 
build the pipeline to Wolf Point in fiscal year 2010, which is a 
regional transmission pipeline west of the water treatment and serves 
the west sides of the Fort Peck Indian Reservation and Dry Prairie.
    The pipeline project from the water treatment plant to Poplar will 
provide a water supply from the Missouri River to replace groundwater 
contaminated by ``brine'' from oil drilling operations. The brine 
contamination is the subject of EPA orders against the responsible oil 
company. The replacement supplies will serve the community of Poplar 
and the surrounding rural area where wells have been contaminated. More 
wells are threatened. There is urgency in completing the regional 
project to Poplar before the advancing plume of contamination reaches 
existing community wells. Projections of the date that contamination 
will reach the Poplar community wells range from imminent danger to as 
much as a decade, but the anxiety of the tribes' leadership and 
membership cannot be overcome without completing the water treatment 
plant and connecting the regional pipeline to Poplar in fiscal year 
2010. This is a critical timeframe for the tribes. The staff and 
members of the subcommittee are urged to review this matter with the 
tribes and Bureau of Reclamation to clarify the urgency of completing 
necessary project facilities and alleviating the threat of 
contamination of the public water supply for the tribes' headquarters 
community of Poplar. (See Attachment E).
    The Bureau of Reclamation can confirm that the use of funds 
proposed for fiscal year 2010 is within the project's capability to 
spend (see Attachment A).
            Dry Prairie
    Dry Prairie has used previous appropriations to construct over 200 
miles of distribution pipelines from the community of Culbertson, an 
interim water source to be replaced when the regional water treatment 
plant and transmission pipeline have been completed on the Fort Peck 
Indian Reservation. The distribution system serves the communities of 
Froid and Medicine Lake and over 200 rural homes, farms and ranches. 
Pipelines were sized to serve the area north of the Missouri River, 
south of the Canadian border and between the Fort Peck Indian 
Reservation and the North Dakota border (see general location map, 
Attachment B) as funds are made available and water sources are 
expanded.
    The request for fiscal year 2010 funds of $13.011 million, 
supplemented by a non-Federal cost share of $4.107 million, will be 
used to complete pipelines starting in fiscal year 2009 to rural 
services on the west side of the Dry Prairie project between the 
communities of St. Marie and Nashua. An existing water treatment plant 
owned by the Boeing Co. at the former Glasgow Air Force Base will 
provide an interim water supply to serve the west side project until 
the regional water treatment plant of the tribes is complete and 
pipelines from Wolf Point to Nashua are constructed. The facilities 
constructed on the west side of the project are the same facilities 
required after connection of the regional water treatment plant. 
Therefore, no duplication of facilities are associated with the interim 
project.
    Dry Prairie will also assist the Assiniboine and Sioux Tribes in 
building pipelines from Culbertson on the east side of the project to 
the Reservation boundary to serve the tribal community of Fort Kipp 
with an interim water supply. The tribes are building facilities within 
the Reservation with fiscal year 2009 funding.
    Dry Prairie proposes to extend interim water supply capability 
between Culbertson and Plentywood with fiscal year 2010 funding. These 
facilities will be served from the tribes' regional water treatment 
plant when the plant and interconnecting main transmission pipelines 
are completed to Culbertson.
Master Plan
    The project master plan is provided for review as Attachment C. The 
request for fiscal year 2010 is shown in relation to the project 
components that remain to be completed after fiscal year 2009.
Administration's Support
    The project has reached 22 percent completion over a period of 9 
years and needs greater funding support to complete the project in 
2015. The administration's budget included the project in fiscal year 
2007 at the $5.0 million level but has not supported funds for the 
project since that time. The previous administration's support for the 
rural water program has diminished to include the Mni Wiconi and 
Garrison projects only. Congressional support is needed for the broader 
program of projects under construction.
    The tribes and Dry Prairie have worked extremely well and closely 
with the Bureau of Reclamation since the authorization of the project 
in fiscal year 2000. The Bureau of Reclamation has participated, 
reviewed and commented on the Final Engineering Report, and all 
comments were incorporated into the report. Agreement was reached on 
final presentation. OMB reviewed the Final Engineering Report prior to 
its submission to Congress in the final step of the approval process. 
The Commissioner, Regional and Area Offices of the Bureau of 
Reclamation have been consistently in full agreement with the need, 
scope, total costs, and the ability to pay analysis that supported the 
Federal and non-Federal cost shares. There have been no areas of 
disagreement or controversy in the formulation or implementation of the 
project.
    The Bureau of Reclamation collaborated with the tribes and Dry 
Prairie to conduct and complete value engineering investigations of the 
Final Engineering Report (planning), the Culbertson to Medicine Lake 
pipeline (design), the Poplar to Big Muddy River pipeline (design), the 
Missouri River intake (design) and the Regional Water Treatment plant 
(design). Each of these considerable efforts has been directed at ways 
to save construction and future operation, maintenance and replacement 
costs as planning and design proceed. Agreement with Reclamation has 
been reached in all value engineering sessions on steps to save Federal 
and non-Federal costs in the project.
    The Bureau of Reclamation conducted independent review of the final 
plans and specifications for the Missouri River raw water intake, the 
regional water treatment plant and the Culbertson to Medicine Lake 
Project. The Agency participated heavily during the construction phases 
of those projects and concurred in all aspects of construction from 
bidding through the completion of construction. The regional water 
treatment plant is under construction, and the Bureau of Reclamation is 
providing sound oversight.
    Cooperative agreements have been developed and executed between the 
Bureau of Reclamation and the tribes and between Bureau of Reclamation 
and Dry Prairie. Those cooperative agreements carefully set out goals, 
standards and responsibilities of the parties for planning, design and 
construction. All plans and specifications are subject to levels of 
review by the Bureau of Reclamation pursuant to the cooperative 
agreements. The sponsors collaborate to undertake activities that 
assure proper oversight and approval by the Bureau of Reclamation. Each 
year the tribes and Dry Prairie, in accordance with the cooperative 
agreements, develop a work plan setting out the planning, design and 
construction activities and the allocation of funding to be utilized on 
each project feature.
    Clearly, the Fort Peck Reservation Rural Water System is well 
supported by the Bureau of Reclamation. Congress authorized the project 
with a plan formulated in full cooperation and collaboration with the 
Bureau of Reclamation, and major project features are under 
construction with oversight by the Agency.

                        SUPPLEMENTAL BACKGROUND

Local Project Support
    The Fort Peck Tribes have supported the project since 1992 when 
they conceived it and sought means of improving the quality of life in 
the region. The planning was a logical step after successful completion 
of an historic water rights compact with the State of Montana. This 
compact was the national ``ice breaker'' that increased the level of 
confidence by other tribes in Indian water right settlement 
initiatives. The tribes did not seek financial compensation for the 
settlement of their water rights but sought development of meaningful 
water projects as now authorized.
    The 1999 Montana Legislature approved a funding mechanism from its 
Treasure State Endowment Program to finance the non-Federal share of 
project planning and construction. Demonstrating support of Montana for 
the project, there were only three votes against the statutory funding 
mechanism in both the full House and Senate. The 2001 through 2007 
Montana Legislatures have provided all authorizations and 
appropriations necessary for the non-Federal cost share. (The 2009 
legislature is in session and is expected to continue strong project 
support).
    Dry Prairie support is demonstrated by a financial commitment of 
all 14 communities within the service area to participate in the 
project. Rural support is strong, with about 70 percent of area farms 
and ranches intending to participate as evidenced by their intent fees 
of $100 per household.
Need for Water Quality Improvement
    The Fort Peck Indian Reservation was previously designated as an 
``Enterprise Community'', underscoring the level of poverty and need 
for economic development in the region. The success of economic 
development within the Reservation will be significantly enhanced by 
the availability of higher quality, safe and more ample municipal, 
rural and industrial water supplies that this regional project will 
bring to the Reservation, made more necessary by persistent drought in 
the region. Outside the Fort Peck Indian Reservation, the Dry Prairie 
area has income levels that are higher than within the Reservation but 
lower than the State average.
    The feature of this project that makes it more cost effective than 
similar projects is its proximity to the Missouri River. The southern 
boundary of the Fort Peck Indian Reservation is formed by the Missouri 
River for a distance of more than 60 miles. Many of the towns in this 
regional project are located 2 to 3 miles from the river, including 
Nashua, Frazer, Oswego, Wolf Point, Poplar, Brockton, Culbertson, and 
Bainville. As shown on the enclosed project map, a transmission system 
outside the Fort Peck Indian Reservation will deliver water 30 to 40 
miles north of the Missouri River. Therefore, the distances from the 
Missouri River to all points in the main transmission system are 
shorter than in other projects of this nature in Reclamation's Great 
Plains Region.
















                                 ______
                                 
    Prepared Statement of the National Fish and Wildlife Foundation

    Mr. Chairman and members of the subcommittee, thank you for the 
opportunity to submit testimony regarding fiscal year 2010 Department 
of the Interior Appropriations and funding for the National Fish and 
Wildlife Foundation (Foundation). We respectfully request your approval 
of $5 million through the Bureau of Reclamation's Water and Related 
Resources fiscal year 2010 appropriation. This funding request for 
fiscal year 2010 is within the authorized level for the Foundation and 
would allow us to expand our historical partnership with the Bureau of 
Reclamation.
    In 2009, the Foundation is celebrating its 25th Anniversary and a 
remarkable history of bringing private partners together to leverage 
Federal funds to conserve fish, wildlife, plants and their habitats. 
The Foundation is required by law to match each federally-appropriated 
dollar with a minimum of one non-Federal dollar. We consistently exceed 
this requirement by leveraging Federal funds at a 3:1 ratio while 
providing thought leadership and emphasizing accountability, measurable 
results, and sustainable conservation outcomes. Funds appropriated by 
this subcommittee are fully dedicated to project grants and do not 
cover any overhead expenses of the Foundation.
    As of fiscal year 2008, the Foundation had awarded over 10,000 
grants to more than 3,500 national and community-based organizations 
through successful partnerships with the Department of the Interior 
agencies, including the Bureau of Reclamation (BOR), U.S. Fish and 
Wildlife Service (FWS), Bureau of Land Management (BLM). In addition, 
our collaborative inter-agency model has grown to include partnerships 
with the Environmental Protection Agency, National Oceanic and 
Atmospheric Administration, USDA Forest Service, USDA Natural Resources 
Conservation Service, and several other Federal agencies. This 
effective model brings together multiple Federal agencies with local 
government and private organizations to implement conservation 
strategies that directly benefit diverse habitats and a wide range of 
fish and wildlife species.

                       HISTORY OF BOR PARTNERSHIP

    BOR has been an important funding partner with the Foundation since 
1996. This subcommittee provided direct BOR appropriations to the 
Foundation during fiscal year 1996-fiscal year 2003 and we also have a 
long history of working with BOR through discretionary cooperative 
agreements. Some examples of our successful partnership include:
  --Pacific Grassroots Salmonid Initiative.--BOR was a partner with the 
        Foundation and NOAA to restore native fish habitat in 
        California, Oregon, and Alaska. Community-based grants support 
        projects for in-stream habitat restoration, fish passage 
        improvements, and barrier removals to benefit salmonids.
  --Bring Back the Natives Program.--BOR participated in a national 
        grant program to restore aquatic species back to historic 
        habitats with the Foundation, U.S. Fish and Wildlife Service, 
        Forest Service and Bureau of Land Management. Bring Back the 
        Natives has already benefited more than 120 species, including 
        29 listed species such as salmon, desert pupfish, modoc 
        suckers, tui and borax chubs and toiyabe spotted frog.
  --Lower Colorado River Multi-Species Conservation Program.--The 
        Foundation previously partnered with BOR as part of this 
        program to administer funds and coordination of on-the-ground 
        conservation activities. As part of the program, the Foundation 
        successfully acquired 1,400 acres of Southwestern Willow 
        Flycatcher riparian habitat in New Mexico and Arizona.
  --Williamson River Delta.--BOR is currently a partner in the 
        Foundation's efforts in the Williamson River Delta of Upper 
        Klamath Lake to protect, restore and maintain shoreline 
        wetlands critically important for the ESA-listed short-nosed 
        and Lost River suckers and to support monitoring efforts for 
        fish passage in the basin.

                     FISCAL YEAR 2010 OPPORTUNITIES

    Fiscal year 2010 appropriations through BOR would allow the 
Foundation to build more robust programs for our ongoing efforts and 
forge new and innovative partnerships with BOR that will be required to 
further develop water transaction programs to increase in-stream flows 
for fish, removing fish passage barriers, and improving water quality 
in reservoirs. These strategies are essential to the recovery of many 
important fish species and provide important recreational opportunities 
for the public.
    It is widely known that climate change will endanger some fish and 
wildlife populations and ecosystems more than others. In fiscal year 
2008, the Foundation initiated grant-making through new keystone 
initiatives, which focus on conservation and measurable impact on 
select species of birds, fish and sensitive habitats. With BOR and 
other agency funding in fiscal year 2010, we will accelerate 
implementation of these strategic initiatives, many of which seek to 
address the affects of climate change through wildlife and natural 
resource adaptation. To ensure success in these investments, we are 
incorporating monitoring and evaluation into the entire lifecycle of 
our strategic initiatives in order to identify the highest priority 
areas that will be resilient to climate change to assure long-term 
conservation effectiveness, measure progress, promote adaptive 
management, demonstrate results, and continuously learn from our grant-
making.
    With our partners, the Foundation has identified several species 
and ecosystems in need of immediate conservation action. In partnership 
with BOR, fiscal year 2010 funds will focus on restoration of in-stream 
flows, imperiled species recovery, and reservoir management.
  --Restoration of In-Stream Flows.--We recognize that climate change 
        will greatly exacerbate two existing water supply problems 
        which impact wildlife and the public--too little water during 
        critical fish migration periods and the seasonality of 
        freshwater supplies. The Foundation has successfully 
        implemented a water transactions program in the Columbia Basin 
        in partnership with the Bonneville Power Administration, local 
        water trusts, agencies and willing landowners. Building on this 
        success, the Foundation is working proactively with Federal, 
        State and local partners to expand voluntary water transaction 
        programs to benefit a diversity of wildlife species while 
        improving water flows year-round for human use. BOR funding in 
        fiscal year 2010 would support voluntary water transaction 
        programs in the Klamath Basin of Oregon and California to add 
        water storage capability in the watershed and increase 
        available flows to meet both fish and irrigation needs. In 
        central California, fiscal year 2010 funds would also support 
        in-stream flow restoration along the Upper Sacramento River and 
        water storage and increased flows in the Sierra Nevada alpine 
        wetlands, or wet meadows.
  --Imperiled Species Recovery.--Fiscal year 2010 funding would benefit 
        the recovery of multiple fish species in the key watersheds. 
        For example, wetland and stream habitat restoration on working 
        landscapes in the Upper Klamath Basin, Oregon, will benefit two 
        ESA-listed sucker species and native redband trout. In the 
        Lower Klamath Basin of northern California, habitat 
        restoration, fish passage improvement and a new water 
        transactions program would restore flows for Coho salmon, 
        Chinook salmon and steelhead trout. In the Upper Colorado River 
        Basin, our efforts will focus on the warmwater-coldwater 
        interface to improve habitat for Colorado Cutthroat trout, 
        native suckers and chubs on both public and private lands.
  --Reservoir Management.--Fiscal year 2010 funding would support 
        implementation of a Colorado River native fishes habitat 
        restoration program near BOR reservoirs. Working with BOR and 
        the U.S. Fish and Wildlife Service, one or two high priority 
        reservoirs will be targeted to serve as demonstration projects 
        for how reservoir habitat restoration can lead to improved lake 
        health, increased wildlife-related recreation opportunities and 
        strengthened local economies. In many reservoirs across the 
        west, fish habitat has significantly diminished since 
        construction of the reservoirs. This is due to loss of habitat 
        structure within the reservoir as well as reduced water quality 
        upstream of the reservoir. The Foundation will work with BOR 
        and other partners to improve upstream habitat and water 
        quality for native fish while also improving habitat conditions 
        within the reservoir.
    With a fiscal year 2010 BOR appropriation, the Foundation would 
engage non-Federal donors to support these strategic conservation 
initiatives through corporate contributions, legal settlements, and 
direct gifts. As a neutral convener, the Foundation is in a unique 
position to work with the Federal agencies, State and local government, 
corporations, foundations, conservation organizations and others to 
build strategic partnerships to address the most significant threats to 
fish and wildlife populations and their habitats. Currently, the 
Foundation has active partnerships with more than 30 corporations and 
foundations and 17 Federal agencies.
Efficiency, Performance Measures and Accountability
    In the last couple of years, the Foundation has taken important 
strides to strengthen our performance measures and accountability. For 
example, the Foundation is working with scientists and other experts to 
develop species-specific metrics for each of our keystone initiatives 
that we will use to measure our progress in achieving our conservation 
outcomes. Our grant review and contracting processes have been improved 
to ensure we maximize efficiency while maintaining strict financial and 
evaluation-based requirements. We have enhanced our Web site with 
interactive tools such as webinars and a grants library to enhance the 
transparency of our grant-making, and instituted a new paperless 
application and grant administration system. In 2009, we will continue 
our efforts improve communication between and among our stakeholders 
and streamlining of our grant-making process.
    The Foundation's grant-making involves a thorough internal and 
external review process. Peer reviews involve Federal and State 
agencies, affected industry, non-profit organizations, and academics. 
Grants are also reviewed by the Foundation's issue experts, as well as 
evaluation staff, before being recommended to the Board of Directors 
for approval. In addition, according to our Congressional Charter, the 
Foundation provides a 30-day notification to the Members of Congress 
for the congressional district and State in which a grant will be 
funded, prior to making a funding decision.
    Once again, Mr. Chairman, we greatly appreciate your continued 
support and hope the subcommittee will approve funding for the 
Foundation in fiscal year 2010.
                                 ______
                                 
 Prepared Statement of the Northern Colorado Water Conservancy District

    Dear Chairman Dorgan and Senator Bennett, on behalf of the Northern 
Colorado Water Conservancy District, I am requesting your support for 
an appropriation in the President's recommended budget for fiscal year 
2010 of $3,569,000 to the Bureau of Reclamation within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region. The funding designation we seek is as 
follows: $1,219,000 for construction activities for the Upper Colorado 
River Endangered Fish Recovery Program; $1,950,000 for construction 
activities for the San Juan River Basin Recovery Implementation 
Program; and $400,000 for Fish and Wildlife Management and Development 
activities to avoid jeopardy. This funding is authorized by Public Law 
106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
                       Prepared Statement of APS

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
   Prepared Statement of the New Mexico Interstate Stream Commission

    Dear Chairman Dorgan, attached herewith is my statement in support 
of funding for the U.S. Bureau of Reclamation's Colorado River Basin 
salinity control program. I sincerely appreciate your favorable 
consideration of this statement and request that it be made a part of 
the formal hearing record for fiscal year 2010 appropriations for the 
Bureau of Reclamation. Also, I fully support the statement of Jack 
Barnett, Executive Director, Colorado River Basin Salinity Control 
Forum, submitted to you in support of the Bureau of Reclamation's 
Colorado River Basin salinity control program.
                                 ______
                                 
   Prepared Statement of the Central Utah Water Conservancy District

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
      Prepared Statement of the Santa Clara Valley Water District

                                SUMMARY

    This statement urges the subcommittee's support for a fiscal year 
2010 appropriation of $40 million for California Bay-Delta Restoration.

             STATEMENT OF SUPPORT CALFED BAY-DELTA PROGRAM

    Background.--In an average year, half of Santa Clara County's water 
supply is imported from the San Francisco Bay/Sacramento-San Joaquin 
Delta estuary (Bay-Delta) watersheds through three water projects: The 
State Water Project, the Federal Central Valley Project, and San 
Francisco's Hetch Hetchy Project. In conjunction with locally developed 
water, this water supply supports more than 1.7 million residents in 
Santa Clara County and the most important high-tech center in the 
world. In average to wet years, there is enough water to meet the 
county's long-term needs. In dry years, however, the county could face 
a water supply shortage of as much as 100,000 acre-feet per year, or 
roughly 20 percent of the expected demand. In addition to shortages due 
to hydrologic variations, the county's imported supplies have been 
reduced due to regulatory restrictions placed on the operation of the 
State and Federal water projects.
    There are also water quality problems associated with using Bay-
Delta water as a drinking water supply. Organic materials and 
pollutants discharged into the Delta, together with salt water mixing 
in from San Francisco Bay, have the potential to create disinfection by 
products that are carcinogenic and pose reproductive health concerns.
    Santa Clara County's imported supplies are also vulnerable to 
extended outages due to catastrophic failures such as major earthquakes 
and flooding.
    Project Synopsis.--The CALFED Bay-Delta Program is an 
unprecedented, cooperative effort among Federal, State, and local 
agencies to restore the Bay-Delta. With input from urban, agricultural, 
environmental, fishing, and business interests, and the general public, 
CALFED has developed a comprehensive, long-term plan to address 
ecosystem and water management issues in the Bay-Delta.
    Restoring the Bay-Delta ecosystem is important not only because of 
its significance as an environmental resource, but also because failing 
to do so will stall efforts to improve water supply reliability and 
water quality for millions of Californians and the State's trillion 
dollar economy and job base.
    The passage of H.R. 2828 (Public Law 108-361) in 2004 reauthorized 
Federal participation in the CALFED Bay-Delta Program and provided $389 
million in new and expanded funding authority for selected projects, 
including the San Luis Reservoir Low Point Improvement Project. The San 
Luis Project is one of six new projects, studies or water management 
actions authorized to receive a share of up to $184 million under the 
conveyance section of the bill. It is critical that Federal funding be 
provided to implement the actions authorized in the bill in the coming 
years.
    Fiscal Year 2009 Funding.--Congress appropriated $40 million to the 
program in fiscal year 2009.
    Fiscal Year 2010 Funding Recommendation.--It is requested that the 
congressional committee support an appropriation of $40 million for 
California Bay-Delta Restoration.
                                 ______
                                 
     Prepared Statement of the Colorado River Energy Distributors 
                          Association (CREDA)

    Dear Chairman Dorgan and Senator Bennett, the Colorado River Energy 
Distributors Association (CREDA) requests your support for an 
appropriation in the President's recommended budget for fiscal year 
2010 of $3,569,000 to the Bureau of Reclamation within the budget line 
item entitled ``Endangered Species Recovery Implementation Program'' 
for the Upper Colorado Region. The funding designation is as follows: 
$1,219,000 for construction activities for the Upper Colorado River 
Endangered Fish Recovery Program; $1,950,000 for construction 
activities for the San Juan River Basin Recovery Implementation 
Program; and $400,000 for Fish and Wildlife Management and Development 
activities. This funding is authorized by Public Law 106-392, as 
amended.
    CREDA members serve over 4 million electric consumers in the States 
of Arizona, Colorado, Nevada, Utah, New Mexico and Wyoming. CREDA 
members are the purchasers of the clean, renewable hydropower resources 
of the Federal Colorado River Storage Project (CRSP). CREDA is a 
participant in these cooperative programs. CRSP power revenues are 
continuing to be used to provide ongoing base funding for these 
programs. The programs' objectives are to recover endangered fish 
species while water use and development proceeds in compliance with the 
Endangered Species Act.
    CREDA appreciates the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
         Prepared Statement of the Utah Water Users Association

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
                   Prepared Statement of Denver Water

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
     Prepared Statement of the Grand Valley Water Users Association

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
 Prepared Statement of the Confederated Tribes of the Umatilla Indian 
                              Reservation

    Honorable Chairman Dorgan, Ranking Member Bennett, members of the 
subcommittee, we respectfully request fiscal year 2010 appropriation of 
funds for two priority watershed restoration and agricultural water 
supply protection projects in Oregon and Washington, the Umatilla Basin 
Water Supply Study Project (previously funded under the Umatilla Basin 
Project Phase III, OR) and the Walla Walla General Investigation Stream 
Flow Restoration Feasibility Study (previously funded under the Walla 
Walla River Watershed, OR & WA).
  --For the Umatilla Basin Water Supply Project, Oregon, we request an 
        appropriation of $150,000 in the Bureau of Reclamation, Pacific 
        Northwest Region, Water and Related Resources budget. This 
        request will enable the Bureau to finish the study and brings 
        to fruition the project that was initiated by the $450,000 
        committed by the Bureau of Reclamation to the project in fiscal 
        year 2007, the approximately $488,000 and $342,000 provided by 
        the subcommittee for fiscal year 2008 and fiscal year 2009 
        respectively.
  --For the Walla Walla River Watershed, Oregon and Washington, we 
        request an appropriation of $500,000 in the U.S. Army Corps of 
        Engineers, Portland Division, Walla Walla District, General 
        Investigations budget, and an additional $270,000 identified 
        for the Corps to provide to the Confederated Umatilla Tribes 
        through inter-governmental agreement to complete work required 
        as project sponsor. This request will allow the district and 
        the tribal government as Project Sponsor to move directly into 
        Pre-Construction Engineering and Design after completion of 
        Feasibility Report in 2010. This project is also known as Walla 
        Walla River Basin Feasibility Report/Environmental Impact 
        Statement.
    Both the Umatilla Basin Water Supply Project and the Walla Walla 
General Investigation Stream Flow Restoration Feasibility Study are 
ongoing projects and have had administration and/or Congressional line 
item funding in past fiscal years.

           UMATILLA RIVER BASIN, OREGON WATER SUPPLY PROJECT

    By letter dated March 19, 2007, the Office of the Secretary of 
Interior responded favorably to the formal requests of the Oregon 
Congressional delegation and of the Confederated Tribes of the Umatilla 
Indian Reservation (CTUIR), Westland Irrigation District and Oregon 
Governor Theodore Kulongoski to initiate the study of the Umatilla 
Basin water development projects and concurrent settlement of the 
tribe's reserved water rights. Counselor to the Secretary, L. Michael 
Bogert, wrote ``I will ask the Secretary's Indian Water Rights Office 
to appoint an Assessment Team . . .'' and ``I will also ask the Bureau 
of Reclamation to move forward with a concurrent appraisal level study 
of water supply options, including a full Phase III exchange . . . to 
help resolve the tribe's water rights claims.''
    The Bureau of Reclamation provided $450,000 in fiscal year 2007 for 
work on the Umatilla Basin water supply appraisal study. The 
subcommittee subsequently provided approximately $488,000 and $342,000 
for this account in the fiscal year 2008 and fiscal year 2009 Energy 
and Water Appropriations bills. The Bureau is actively developing its 
Umatilla Basin Water Supply Study with these funds and will complete 
the project in 2010 with the requested funding.
    The Umatilla Basin Water Supply Project is authorized by the 
Reclamation Feasibility Studies Act of 1966, 80 Stat. 707, Public Law 
89-561, (Sept. 7, 1966).
    The fiscal year 2010 request of $150,000 will enable the Bureau of 
Reclamation to complete the estimated 2\1/2\ year appraisal level study 
in mid 2010. The detailed appraisal study project will inform the 
concurrent Interior Department Indian Water Rights Assessment Team's 
work product. In 2010, Interior should have identified and estimated 
costs and feasibility of a clear project or suite of projects necessary 
to satisfy water rights of the CTUIR and in the Umatilla River.
    This fiscal year 2010 request follows on the work of the Bureau of 
Reclamation, authorized by the Umatilla Basin Project Act of 1988 (100 
Public Law 557; 102 Stat. 2782 title II), to construct and operate the 
Phase I Exchange with West Extension Irrigation District and the Phase 
II Exchange with Hermiston and Stanfield Irrigation Districts. Heralded 
as one of the most successful stream flow restoration and salmon 
recovery projects in the Columbia River Basin, the Umatilla Basin 
Project resulted in partially restored stream flows in the Umatilla 
River and successful reintroduction of spring Chinook, fall Chinook and 
Coho salmon. After nearly a century of dry river bed in summer months 
and extinction of all salmon stocks, there has been an Indian and non-
Indian salmon fishery nearly every year in the Umatilla River since the 
project was completed in the mid-1990s.
    Completion of the Water Supply Study and the concurrent Tribal 
Water Rights Assessment is supported and endorsed by the Honorable 
Governor Ted Kulongoski and by local irrigation districts including 
specifically Westland Irrigation District, the Umatilla County 
Commission, and local municipalities including specifically the city of 
Irrigon.

     WALLA WALLA BASIN, OREGON AND WASHINGTON, GI FEASIBILITY STUDY

    In its eighth and final full year of work leading to Study 
completion, the U.S. Army Corps of Engineers' feasibility study will 
complete a detailed analysis of the preferred alternative selected to 
restore stream flows in the Walla Walla River. Drained nearly dry 
during summer months by irrigation in Oregon and Washington, the Walla 
Walla River is within the aboriginal lands of the CTUIR and the 
complete loss of salmon violates the agreement by the United States in 
the Treaty of 1855 to protect these fish.
    Since the study's inception, approximately $4 million of Federal 
funds have either been budgeted or appropriated for completion of the 
Study through fiscal year 2009. The Walla Walla District will complete 
the Feasibility Study Report in fiscal year 2010 and this request for 
$500,000 for the Corps and $270,000 for the tribe will allow the 
District and CTUIR to move directly into initiation of Pre-Construction 
Feasibility and Design phase.
    The Feasibility Study Project is authorized by the Senate Committee 
on Public Works July 27, 1962 (Columbia River and Tributaries), 87th 
Congress, House Document No. 403 and initiated as a result of a 
positive Reconnaissance Report for the Walla Walla River Watershed 
(1997) under a General Investigation study.
    The CTUIR is the formal sponsor of the Corps of Engineers 
Feasibility Study and has provided over $4.0 million in in-kind 
contributions. Additionally, the State of Washington Department of 
Ecology has provided $400,000 to the Feasibility Study. This is the 
first year the CTUIR will request Federal funding, over and above that 
requested for Corps of Engineers work, to enable the tribe's 
continuation as Project Sponsor. Because of the unique status as a 
Federal-recognized Indian tribe with Treaty Rights to the Walla Walla 
Basin, and owing to the fact the CTUIR is the formal sponsor of the 
Project, the Confederated Umatilla Tribes request an additional 
appropriation of $270,000 to support their sponsor-required work of 
real estate transactions and water right permitting from Oregon and 
Washington. This will allow the tribe to initiate this work and will 
necessitate additional and continued 2011 support to fund acquisition 
of real property and other related activities. Prior to addressing this 
unique situation in an upcoming Water Resources Development Act bill, 
CTUIR requests the subcommittee consider this request as a clear 
exception to the standard requirement that non-Federal sponsors provide 
non-Federal funding.
    Support for the completion of the Feasibility Study and moving to 
construction of the project is strong and diverse and includes the 
Honorable Governor of Washington Christine Gregoire, the Honorable 
Governor of Oregon Ted Kulongoski, the Walla Walla Watershed Alliance, 
the Walla Walla Basin Watershed Council, basin irrigation districts, 
local State legislators, local governments and many local and regional 
advocacy groups.

                               CONCLUSION

    In closing, the CTUIR appreciates the opportunity to provide this 
testimony in support of adding funds for the ongoing Umatilla River 
Basin Water Supply Project, Bureau of Reclamation, and the Walla Walla 
River Basin Watershed Restoration Feasibility Study, Army Corps of 
Engineers. Both projects are critically important to protecting 
existing agricultural economies, completing future water supply 
development and concurrently restoring stream flows and recovering 
threatened salmon and other Columbia River Basin fish stocks.
    Thank you.
                                 ______
                                 
  Prepared Statement of the Uncompahgre Valley Water Users Association

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 
   Prepared Statement of the Upper Gunnison River Water Conservancy 
                                District

    Dear Chairman Dorgan and Senator Bennett, we are requesting your 
support for an appropriation in the President's recommended budget for 
fiscal year 2010 of $3,569,000 to the Bureau of Reclamation within the 
budget line item entitled ``Endangered Species Recovery Implementation 
Program'' for the Upper Colorado Region. The funding designation we 
seek is as follows: $1,219,000 for construction activities for the 
Upper Colorado River Endangered Fish Recovery Program; $1,950,000 for 
construction activities for the San Juan River Basin Recovery 
Implementation Program; and $400,000 for Fish and Wildlife Management 
and Development activities to avoid jeopardy. This funding is 
authorized by Public Law 106-392, as amended.
    These highly successful, cooperative programs are ongoing 
partnerships among the States of New Mexico, Colorado, Utah and 
Wyoming, Indian tribes, Federal agencies and water, power and 
environmental interests. The programs' objectives are to recover 
endangered fish species while water use and development proceeds in 
compliance with the Endangered Species Act.
    I appreciate the subcommittee's past support and request the 
subcommittee's assistance for fiscal year 2010 funding to ensure the 
Bureau of Reclamation's continuing financial participation in these 
vitally important programs.
                                 ______
                                 

                          DEPARTMENT OF ENERGY

        Prepared Statement of the Gas Turbine Association (GTA)
    The Gas Turbine Association appreciates the opportunity to provide 
the United States Senate Committee on Appropriations Subcommittee on 
Energy and Water Development with our industry's statement recommending 
fiscal year 2010 funding levels for the Department of Energy.
    GTA recommends that the fiscal year 2010 appropriation for Fossil 
Energy include $45 million for the Advanced Turbines Program to meet 
critical national goals of fuel conservation, fuel flexibility 
(including syngas and hydrogen), greenhouse gas reduction, and criteria 
pollutant reduction. We also recommend that Congress take appropriate 
action to ensure the Office of Energy Efficiency and Renewable Energy, 
Industrial Technologies Program fiscal year 2010 appropriation include 
$10 million, directed towards small gas turbine research, as part of 
the Distributed Energy program to achieve goals similar to those 
referenced above for the Fossil Energy initiative. In both cases a 
public-private partnership is needed to ensure success.
    It is clear that dramatic reductions in greenhouse gas emissions 
are in the national interest. It is also clear that our economy needs 
more electric generation capacity to resume and promote further growth. 
Without new technology, the power generation industry will be hard 
pressed to produce additional electric capacity, while at the same time 
meeting the strict greenhouse gas emissions standards being set by 
States and the Federal Government.
    Federal investment in research and technology development for 
advanced gas turbines that are more versatile, cleaner, and have the 
ability to burn hydrogen-bearing reduced carbon synthetic fuels and 
carbon-neutral alternative fuels is needed to ensure the reliable 
supply of electricity in the next several decades. Domestic coal based 
Integrated Gasification Combined Cycle (IGCC) with carbon capture and 
sequestration is one such approach that would significantly supplement 
available supplies of domestic natural gas to guarantee an adequate 
supply of clean and affordable electric power. Alternative fuel choices 
range from imported LNG, coal bed methane, and coal-derived synthetic 
or process gas to biogas, waste-derived gases and hydrogen. Research is 
needed to improve the efficiency, reduce capital and operating costs, 
and reduce emissions.
technologies for advanced igcc/h2 gas turbine--reducing the 

                   PENALTY FOR CO2 CAPTURE

    At current rates of research and development it is unlikely that 
the Nation will have available the gas turbine technologies to meet the 
needs of FutureGen type power plants. The advancement of these 
technologies must be undertaken by the DOE since there is currently no 
pathway to the development, insertion, and maturation of these 
technologies into the Nation's electric power infrastructure based on 
market forces. Thus, a combined effort by the public and private 
sectors is necessary.
    The turbines and related technologies being developed under the DOE 
FE Advanced Turbines program will directly advance the performance and 
capabilities of future power generation with CO2 capture and 
sequestration. Advances are needed to offset part of the power plant 
efficiency and output reductions associated with CO2 
capture. Program funding is required to cost-share in the technology 
development of advanced hydrogen/syngas combustors and other components 
to realize the DOE goals.
    Several GTA member companies are working cost-share programs with 
the DOE to develop technologies for advanced gas turbine power plants 
with carbon capture. These technologies will: (1) increase plant 
efficiency; (2) increase plant capacities; and (3) allow further 
reductions in combustion emissions of hydrogen rich fuels associated 
with CO2 capture and sequestration. This will help offset 
some of the efficiency and output penalties associated with 
CO2 capture. These programs are funding technology 
advancement at a much more rapid rate than industry can do on their 
own.
    The need for increased levels of Federal cost-share funding is 
immediate. The funding levels in past years for the Advanced Turbines 
program has been inadequate to meet DOE's Advanced Power System goal of 
an IGCC power system with high efficiency (45-50 percent HHV), near-
zero emissions and competitive capital cost. To meet this goal, the 
researchers must demonstrate a 2 to 3 percentage point improvement in 
combined cycle efficiency above current state-of-the-art Combined Cycle 
turbines in IGCC applications.
    The plan for the IGCC-based FutureGen-type application is to 
develop the flexibility in this same machine with modifications to 
operate on pure hydrogen as the primary energy source while maintaining 
the same levels of performance in terms efficiency and emissions. The 
goal is to develop the fundamental technologies needed for advanced 
hydrogen turbines and to integrate this technology with CO2 
separation, capture, and sequestration into a near-zero emission 
configuration that can provide electricity with less than a 10 percent 
increase in cost over conventional plants by 2012.
    The Advanced Turbines program is also developing oxygen-fired (oxy-
fuel) turbines and combustors that are expected to achieve efficiencies 
in the 44-46 percent range, with near-100 percent CO2 
capture and near-zero NOX emissions. The development and 
integrated testing of a new combustor, turbine components, advanced 
cooling technology, and materials in oxy-fuel combustors and turbines 
is needed to make these systems commercially viable.
    The knowledge and confidence that generating equipment will operate 
reliably and efficiently on varying fuels is essential for the 
deployment of new technology. Years of continued under funding of the 
Advanced Turbines program has already delayed the completion dates for 
turbine R&D necessary for advanced IGCC, as well as timing for a 
FutureGen-type plant validation.

                      MEGA-WATT SCALE TURBINE R&D

    In the 2005 Enabling Turbine Technologies for High-Hydrogen Fuels 
solicitation, the Office of Fossil Energy included a topic area 
entitled ``Development of Highly Efficient Zero Emission Hydrogen 
Combustion Technology for Mega-Watt Scale Turbines''. Turbine 
manufacturers and combustion system developers responded favorably to 
this topic, but DOE funding constraints did not allow any contract 
awards. The turbine industry recommends a follow-up to this 
solicitation topic that would allow the developed combustion technology 
to be tested in machines at full scale conditions and allow for 
additional combustion technology and combustor development for high-
hydrogen fuels.
    The turbine industry believes that this technology is highly 
relevant to industrial coal gasification applications including: (1) 
site-hardened black-start capability for integrated gasification 
combined cycle applications (the ability to restart an IGCC power plant 
when the electric grid has collapsed); (2) supplying plant electric 
load fueled on syngas or hydrogen; (3) increasing plant steam cycle 
capacity on hot days when large amounts of additional power are needed; 
and (4) in gas turbines for compression of high-hydrogen fuels for 
pipeline transportation. The development of MW-scale turbines (1-100 
MW) fueled with high-hydrogen fuels will promote the sustainable use of 
coal. In addition, highly efficient aeroderivative megawatt scale 
engines operate under different conditions than their larger 
counterparts and are installed for peaking or distributed generation 
applications. Funding is required to design efficient and low emissions 
combustors that accommodate the new fuels.

   HIGH-EFFICIENCY, LOW CARBON, FUEL FLEXIBLE SMALL GAS TURBINES FOR 
                           DISTRIBUTED ENERGY

    The Distributed Energy Program of EERE's Industrial Technologies 
program should include $10 million to initiate small gas turbine 
research and development programs to dramatically increase their fuel 
efficiency (and thus reduce their carbon footprint) and to make them 
fuel flexible. Distributed energy is critical to building a efficient, 
diverse, and robust electric power infrastructure. Specifically, this 
program should set a goal of 42 percent efficiency (on a lower heating 
value basis) for advanced small gas turbines while enhancing their fuel 
flexibility to include dual fuel and alternative fuel utilization. 
These programs should build on the success of the Advanced Micro-
turbine program of past years to overcome the barriers to insertion of 
Distributed Energy into our Nation's electrical infrastructure and to 
build on potential synergies between advanced small gas turbines and 
the advances in waste heat capture such as combined heat and power 
(CHP) and organic Rankine cycle (ORC).

              GAS TURBINES REDUCE GREENHOUSE GAS EMISSIONS

    The gas turbine industry's R&D partnership with the Federal 
Government has steadily increased power plant efficiency to the point 
where natural gas fired turbines can reach combined cycle efficiencies 
of 60 percent, and quick-start simple cycle peaking units can reach 46 
percent. The gas turbine's clean exhaust can be used to create hot 
water, steam, or even chilled water. In such combined heat and power 
applications, overall system efficiency levels can reach 60 to 85 
percent LHV. This compares to 40-45 percent for even the most advanced 
thermal steam cycles (most of which are coal fired).




    Gas turbines already play a very significant role in minimizing 
greenhouse gas emissions worldwide. Gas turbines are both more 
efficient and typically burn lower carbon fuels compared to other types 
of combustion-based power generation and mechanical drive applications. 
The Nation needs to reinvigorate the gas turbine/Government partnership 
in order to develop new, low carbon power plant solutions without 
increasing our reliance on natural gas. This can be done by funding 
research to make gas turbines more capable of utilizing hydrogen and 
synthetic fuels as well as increasing the efficiency, durability and 
emissions capability of natural gas fired turbines. If Congress 
provides adequate funding to DOE's turbine R&D efforts, technology 
development and deployment will be accelerated to a pace that will 
allow the United States to achieve its emissions and energy security 
goals.
    The GTA respectfully requests $45 million in fiscal year 2010 
appropriations for the Fossil Energy Advanced Turbines Program, and $10 
million for the Energy Efficiency & Renewable Energy ITP/Distributed 
Energy Program directed towards small turbines research in fiscal year 
2010 to meet critical national goals of fuel conservation, fuel 
flexibility (including syngas and hydrogen), greenhouse gas reduction, 
and criteria pollutant reduction.

                          GTA MEMBER COMPANIES

    Alstom Power; Capstone Turbine Corporation; GE Energy; Florida 
Turbine Technologies; Rolls-Royce; Siemens Energy; Solar Turbines; 
Pratt & Whitney Power Systems; Strategic Power Systems; and VibroMeter.
                                 ______
                                 
    Prepared Statement of the Federation of American Societies for 
                          Experimental Biology

    On behalf of the Federation of American Societies for Experimental 
Biology (FASEB), I respectfully request an fiscal year 2010 
appropriation for the Department of Energy Office of Science (DOE SC) 
of 8 percent over fiscal year 2009. This increase will provide the 
Office of Science with the ability to sustain support for critical 
research programs that spur scientific innovation, fuel the economy, 
move the Nation towards energy independence and improve human health.
    As a Federation of 22 professional scientific societies, FASEB 
represents nearly 90,000 life scientists, making us the largest 
coalition of biomedical research associations in the Nation. FASEB's 
mission is to advance health and welfare by promoting progress and 
education in biological and biomedical sciences, including the research 
funded by VA, through service to its member societies and collaborative 
advocacy. FASEB enhances the ability of biomedical and life scientists 
to improve--through their research--the health, well-being and 
productivity of all people.
    FASEB is composed of 22 societies with more than 80,000 members, 
making it the largest coalition of biomedical research associations in 
the United States. Our mission is to advance health and welfare by 
promoting progress and education in biological and biomedical sciences, 
including the science supported by DOE SC.

    ``[T]he Office of Science is commit[ed] to invest in some of the 
most exciting and daring research that humankind has ever conceived, 
from explorations into the origins of our universe and the constituents 
of life, to the scientific knowledge that will deliver new, clean, and 
abundant sources of energy to meet world needs for 10 billion people by 
the year 2050.''

    This bold statement from the DOE SC Strategic Plan \1\ highlights 
DOE SC's unique role in serving as a catalyst for discoveries in basic 
energy research and in environmental and life sciences as well as 
computational science. The research programs and facilities at DOE SC 
support further cutting-edge science and technological innovations that 
safeguard our Nation, strengthen our economy, and improve the daily 
lives of the American people.
---------------------------------------------------------------------------
    \1\ United State Department of Energy. 2004. Office of Science 
Strategic Plan. http://www.er.doe.gov/about/Strategic_Plan/Feb-2004-
Strat-Plan-screen-res.pdf.
---------------------------------------------------------------------------
    Each year, more than 25,000 researchers from universities, other 
government agencies and private industry use DOE SC's extraordinary 
system of national laboratories and research facilities. DOE's state-
of-the-art facilities comprise the most advanced research system of its 
kind in the world and permit the agency to support unique and vital 
programs in climate change, geophysics, genomics, materials and 
chemical sciences, and life sciences. The Office of Science's emphasis 
on interdisciplinary scientific research supports and extends the basic 
research that other Federal agencies sponsor, and much of the research 
that non-DOE science agencies fund could not occur in the absence of 
DOE's highly specialized research infrastructure.
    DOE's contribution to research and science extends beyond the 
benefits of its national laboratories. The Office of Science is also a 
principal supporter of graduate students and early career postdoctoral 
researchers at U.S. colleges and universities. Almost 50 percent of DOE 
SC's research funding supports research at over 300 colleges, 
universities and institutes nationwide.

              DISCOVERIES THAT IMPROVE HEALTH & WELL-BEING

    Scientists whom DOE has supported have uncovered a wealth of basic 
biological knowledge and have produced astounding health technologies.
  --Restoring Function to Patients with Disabilities.--Office of 
        Science funding led to the bion microstimulator, a miniature 
        rechargeable and implantable neurostimulator that may benefit 
        50 million Americans who suffer from debilitating conditions by 
        stimulating viable nerves and muscles to prevent muscle 
        deterioration and help restore nerve and muscle function. The 
        device can address a wide variety of diseases and disorders, 
        including incontinence, chronic headaches, peripheral pain, 
        angina and epilepsy.
  --Targeted Cancer Therapies.--DOE scientists have developed the 
        Cesium-131 Brachytherapy Seed, one of the most significant 
        advancements in brachytherapy (short distance treatment 
        involving the use of carefully placed, radioactive ``seeds'') 
        for cancer treatment in nearly 20 years. In treating prostate 
        and other cancers, it delivers a highly targeted therapeutic 
        dose of radiation to the tumor quickly and with potentially 
        fewer side effects.
    Although research DOE SC has funded has already positively 
influenced our lives and health, opportunities on the horizon are even 
more exciting. For example, the DOE-SC Artificial Retina Project is 
developing an artificial retina that can restore sight in patients who 
are blind; the technology can also help persons who are deaf as well as 
those who have spinal cord injuries, Parkinson's disease and almost any 
other neurological disorder. Additionally, researchers at the Argonne 
National Laboratory and the University of Chicago are engineering an 
``ice slurry'' to cool organs; the slurry may help save stroke or 
cardiac arrest patients from the destruction of their brain and heart 
cells.

                 CLEANER AND MORE SECURE ENERGY FUTURE

    Fundamental discoveries in basic energy sciences funded by DOE SC 
are already having an impact on the energy we use daily and are 
continuing to pave the way for the next generation of environmentally-
conscious, sustainable energy sources. As a recent report \2\ on future 
energy needs produced by DOE stated, ``Major new discoveries are 
needed, and these will largely come from basic research programs.''
---------------------------------------------------------------------------
    \2\ United States Department of Energy, Basic Energy Sciences 
Advisory Committee. 2003. Basic Research Needs to Assure a Secure 
Energy Future. http://www.sc.doe.gov/bes/reports/files/SEF_rpt.pdf.
---------------------------------------------------------------------------
  --Building Better Batteries.--DOE SC discoveries resulted in lithium 
        batteries that offer high-energy storage capacity in an 
        environmentally benign package. Lithium batteries are widely 
        used in both consumer and defense applications, such as 
        cellular telephones and notebook computers. Moreover, DOE 
        researchers have generated a solid-state, fluoride-based 
        battery that is safer than traditional batteries in high-
        temperature applications such as oil, gas and geothermal 
        drilling.
  --Hydrogen Technologies.--At the Argonne National Lab, scientists 
        have constructed the world's fastest commercially producible 
        hydrogen sensor that can be used in hydrogen-powered cars to 
        detect unsafe levels of hydrogen. Scientists have also 
        developed materials resistant to metal dusting degradation, 
        which will be used to make more durable equipment in plants 
        that manufacture hydrogen.
    Researchers are also on the brink of developing new technologies to 
meet our most pressing energy needs. In an effort to increase the 
amount of c solar power in the Nation's energy supply, DOE SC is 
investing in research aimed at improving conversion of solar energy to 
both electricity and chemical fuels. Moreover, fundamental research 
awards have been made to institutions nationwide as scientists work to 
overcome key hurdles in hydrogen production, storage and conversion in 
an effort to increase the feasibility of hydrogen fuel.

               RECOGNIZING THE IMPORTANCE OF DOE RESEARCH

    The passage of the America Creating Opportunities to Meaningfully 
Promote Excellence in Technology, Education and Science (COMPETES) Act 
of 2007 renewed our Nation's commitment to science and technology and 
established a 7 year doubling path for the budget of DOE SC. In 2009, 
generous funding provided in the Omnibus Appropriations Act and the 
American Recovery and Reinvestment Act began to fulfill the commitment 
Congress has made to scientific and technological innovation. In 2010, 
we ask that this support continue, both to protect the investments that 
have been made, and to realize the potential of the scientific 
enterprise. An fiscal year 2010 funding level for DOE SC of 8 percent 
over fiscal year 2009 will allow DOE to greatly enhance its 
groundbreaking research portfolio and permit it to confront current and 
future energy and health challenges. Scientists who have received DOE 
SC funding have made and continue to make extraordinary breakthroughs 
that contribute to the quality of our lives and facilitate advances 
that drive our Nation's innovative technologies.
                                 ______
                                 
  Prepared Statement of the Biomass Energy Research Association (BERA)

                                SUMMARY

    This testimony pertains to fiscal year 2010 appropriations for 
biomass energy research, development, and demonstration (RD&D) 
conducted by the Department of Energy (DOE) Office of Energy Efficiency 
and Renewable Energy (EERE), Biomass Program (OBP). This RD&D is funded 
by the Energy and Water Development bill, under Energy Supply and 
Conservation, Energy Efficiency and Renewable Energy. BERA recommends a 
total appropriation of $400 million in fiscal year 2010 for Biomass and 
Biorefinery Systems R&D. This is an increase of $75 million over the 
U.S. Department of Energy request for fiscal year 2010 for this 
programmatic area. Substantial investments in new technology and 
demonstrations will be needed to meet the RFS goals for advanced 
biofuels. Specific lines items for the DOE biomass RD&D budget are 
below (also see Table 1):
  --$40,000,000 for Feedstock Infrastructure development (regional 
        partnerships, harvesting and storage technology, exploration of 
        new feedstocks).
  --$60,000,000 for Biochemical Conversion Platform Technology 
        (emphasis on cost-effective pretreatment technologies and 
        fermentation organisms--both are large contributors to high 
        cost of biofuels production from cellulosic materials).
  --$60,000,000 for Thermochemical Conversion Platform Technology 
        (conversion of plants, oil crops, energy crops, wood and forest 
        resources to oils, long chain hydrocarbons, or other fuels/
        intermediates).
  --$200,000,000 for Utilization of Platform Outputs: Integrated 
        Biorefinery Technologies demonstrations. Technology 
        demonstrations reduce technical and economic risk and 
        accelerate the potential for private investment.
  --$40,000,000 for Utilization of Platform Outputs: Bioproducts 
        (chemicals and materials).

                               BACKGROUND

    On behalf of BERA's members, we would like to thank you, Mr. 
Chairman, for the opportunity to present the recommendations of BERA's 
Board of Directors for the high-priority programs that we strongly urge 
be continued or started. BERA is a non-profit association based in the 
Washington, DC area. It was founded in 1982 by researchers and private 
organizations conducting biomass research. Our objectives are to 
promote education and research on the economic production of energy and 
fuels from biomass, and to serve as a source of information on biomass 
RD&D policies and programs. BERA does not solicit or accept Federal 
funding.

   TABLE 1.--FISCAL YEAR 2010 BIOMASS/BIOREFINERY SYSTEMS R&D, ENERGY
             SUPPLY & CONSERVATION, DOE/EERE BIOMASS PROGRAM
                        [In millions of dollars]
------------------------------------------------------------------------
             Program Area                 Description of RD&D     Total
------------------------------------------------------------------------
Feedstock Infrastructure.............  Regional feedstock          $40.0
                                        partnerships
                                       Joint development of
                                        storage and harvesting
                                        technology
                                       Plants species amenable
                                        to thermochemical
                                        (e.g., high lignin) and
                                        biochemical (e.g., more
                                        easily processed
                                        lignin) processes
Biochemical Conversion Platform R&D..  Next generation biofuels/    60.0
                                        processes using a range
                                        of feedstocks
                                       Technologies to reduce
                                        costs of pretreatment
                                       Advanced biological
                                        routes that combine
                                        biological methods with
                                        pretreatment to reduce
                                        enzyme costs
                                        dramatically
                                       Seed funding for
                                        revolutionary new
                                        concepts, including
                                        small businesses and
                                        inventors
Thermochemical Conversion Platform     Next generation biofuels     60.0
 R&D.                                   and processes that can
                                        use a range of
                                        feedstocks (pyrolysis,
                                        gasification, routes)
                                       Technologies to reduce
                                        costs of pretreatment
                                       Seed funding for
                                        revolutionary new
                                        concepts, including
                                        small businesses and
                                        inventors
Platform Outputs: Integrated           Direct funding (cost-       200.0
 Biorefineries.                         shared) of biochemical
                                        and thermochemical
                                        conversion technologies
                                       Public awareness and
                                        outreach programs
                                       National center for
                                        infrastructure issues
                                       Underwriting of loan
                                        guarantees
Platform Outputs: Bioproducts........  Co-production of             40.0
                                        chemicals and materials
                                        from biochemical and
                                        thermochemical output
                                        streams as alternatives
                                        to petroleum-derived
                                        chemicals
                                                                --------
      TOTAL..........................  ........................    400.0
------------------------------------------------------------------------

    There is a growing urgency to diversify our energy supply, develop 
technologies to utilize indigenous and renewable resources, reduce U.S. 
reliance on imported oil, and mitigate the impacts of energy on climate 
and the environment. The benefits will be many--support for economic 
growth, new American jobs, enhanced environmental quality, and fewer 
energy-related contributions to climate change. Economic growth is 
fueled and sustained in large part by the availability of reliable, 
cost-effective energy supplies. The import of oil and other fuels into 
the United States is growing steadily, despite increased volatility in 
supply and prices, especially petroleum and natural gas. This creates 
an economic burden on industry and consumers alike, and adversely 
impacts our quality of life. A diversified, sustainable energy supply 
is critical to meeting our energy challenges and maintaining a healthy 
economy with a competitive edge in global markets. Biomass can 
diversify U.S. energy supply in several ways, and biofuels is only one 
avenue:
  --Biomass is the single renewable resource with the ability to 
        directly replace liquid transportation fuels.
  --Biomass can be used as a feedstock to supplement the production of 
        chemicals, plastics, and materials now produced from crude oil.
  --Gasification of biomass produces a syngas that can be utilized to 
        supplement the natural gas supply, generate electricity, or 
        produce fuels and chemicals.
    While biomass will not solve all our energy challenges, it can 
certainly contribute to the diversity of our supply, and do so in a 
sustainable way, while minimizing impacts to the environment or 
climate. The Energy Independence and Security Act (EISA) of 2007 
mandates increased use of alternative fuels, with a substantial portion 
to come from cellulosic biomass. To meet the ambitious EISA goals will 
require aggressive support for RD&D to move technology forward and 
reduce technical and economic risk.
      overall bera recommendations for u.s. doe/eere biomass rd&d
  --Make Investments to Accelerate Development of Next Generation 
        Biofuels/Processes [Platforms Research and Development--
        Biochemical and Thermochemical Platform R&D].--Balance funding 
        so more is allocated toward next generation biofuels and 
        processes that include both biochemical and thermochemical 
        routes, including pyrolysis, gasification, and others, and 
        hybrid routes; emphasize processes that can use a range of 
        biomass types. Include advanced biological routes that better 
        integrate simplified combined biological methods with 
        pretreatment to reduce enzyme costs dramatically as enzymes 
        followed by pretreatment are the major cost items that are 
        susceptible to change.
  --Make Investments to Bring Down the Cost of Biomass Pretreatment 
        [Platforms Research and Development--Biochemical and 
        Thermochemical Platform R&D].--Invest substantial funds to 
        bring down the capital and operating costs of pretreatment of 
        cellulosic biomass. This is very important and deserves 
        emphasis as pretreatment is a major factor in the cost of 
        production and also influences the cost of the rest of process. 
        It remains a major hurdle for commercialization of new 
        processes and achieving economic viability of operating 
        biofuels facilities. Developing pretreatment processes that 
        integrate better with the entire process are a critical aspect.
  --Underwrite an Unprecedented Number of Loan Guarantees and Directly 
        Fund a Wide Range of Demonstrations [Utilization of Platform 
        Outputs: Integrated Biorefineries].--These actions will raise 
        confidence in private investment during uncertain economic 
        times--facilities need to be put in the ground now to make a 
        difference in the mid and long term. Technology demonstrations 
        reduce technical and economic risk and accelerate the potential 
        for private investment. A major concern is that DOE has not 
        approved and disbursed a single loan guarantee under the 
        innovative technology program established by EPAct 2005. 
        However, DOE Secretary Steven Chu indicates he is committed to 
        reform to speed up the loan guarantee process. We suggest that 
        DOE provide 50 percent of capital for first plants with the 
        rest being private funds to compensate for the risk of first 
        projects while assuring enough private capital is on the line 
        for proper due diligence. This level of guarantee is vital--
        introducing any new fuel in today's petroleum-heavy market is 
        extremely challenging. The capital costs for petroleum 
        processing are paid off, making it a cash producer, while a 
        biofuels facility must cover not only cash costs but make a 
        high return on capital to compensate for first time risk. This 
        is a heavy lift for first-of-a-kind technology.
  --Set Aside Funding for Demonstration of Revolutionary, but Unproven 
        New Concepts [Platforms Research and Development--Biochemical 
        and Thermochemical Platform R&D].--Seed funding is needed for 
        revolutionary new ideas that show great promise. We must appeal 
        to the great American sense of innovation and invention to 
        bring ideas to the table that will help solve our energy 
        crises. Small, entrepreneurial inventors and businesses should 
        be part of this equation. This is an important, but riskier 
        proposition, and will take longer to allow for successive 
        funding of ideas and demonstrations.
  --Invest More Funds in Development of Cost-effective New Bioproducts 
        [Utilization of Platform Outputs: Integrated Biorefineries].--
        Some chemicals could be produced from biomass, reducing our 
        dependence on oil-derived chemicals and materials that go into 
        a myriad of consumer goods from paint to food to drugs to 
        plastics. Positive economic returns (and improved margins for 
        integrated biorefineries) could be achieved by production of 
        value-added co-products, whether the facility is based on 
        thermochemical or biochemical technology. Current funding for 
        this area is extremely limited. The challenge is that large 
        plants are needed for economies of scale, thereby favoring 
        biofuels. Chemicals can improve returns in a fuels biorefinery 
        and provide scale advantages, but financing construction of 
        projects involving more than one product is risky.
  --Invest in Study of New Non-food, Non-commodity Biomass [Feedstocks 
        Infrastructure].--This includes algae, selected perennial 
        grasses, wood, and waste (of any kind, industrial, 
        construction, food processing, etc); include an understanding 
        of the viability of these resources (yields, production issues, 
        chemistry, etc) for producing a wide range of fuels (analogs 
        for gasoline, diesel, jet fuel, marine fuel, etc). This should 
        include developing plants species that are more amenable to 
        thermochemical (e.g., high lignin) and biochemical (e.g., low 
        lignin, more easily processed lignin) processing.
  --Invest Significant Resources on Outreach to Increase Public 
        Awareness [Utilization of Platform Outputs].--The importance of 
        public opinion cannot be overstated. Increasing awareness and 
        understanding of biofuels and their impacts on our energy 
        situation is critical. This includes understanding the positive 
        environmental impacts, and dispelling of misperceptions--we 
        need to get the truth out there, good and bad--and enable 
        consumers to make good choices. Funding should include 
        incentives to States to get the word out and educate the 
        public--and make this information available where people fuel 
        up--at local filling stations and grocery stores, etc.
  --Jointly Fund (With USDA, DOT, EPA) a National Center to Address 
        Infrastructure Issues [Utilization of Platform Outputs].--A 
        national center for centralized information and technology 
        exchange is needed, covering all areas of infrastructure from 
        storage and transport of feedstocks to blending, storage and 
        distribution of fuels to consumers. This center would 
        incorporate a public-private partnership model to encourage 
        investment in infrastructure. Infrastructure has not received 
        much attention, but could severely impede reaching EISA RFS 
        goals.
                                 ______
                                 
 Prepared Statement of the State Teachers' Retirement System, State of 
                               California

    Department of Energy--Elk Hills School Lands Fund: $9.7 million for 
fiscal year 2010 installment of Elk Hills compensation.
    Congress should appropriate the funds necessary to fulfill the 
Federal Government's settlement obligation to provide compensation for 
the State of California's interest in the Elk Hills Naval Petroleum 
Reserve.

                                SUMMARY

    Acting pursuant to congressional mandate, and in order to maximize 
the revenues for the Federal taxpayer from the sale of the Elk Hills 
Naval Petroleum Reserve by removing the cloud of the State of 
California's claims, the Federal Government reached a settlement with 
the State in advance of the sale. The State waived its rights to the 
Reserve in exchange for fair compensation in installments stretched out 
over an extended period of time. The State respectfully requests an 
appropriation of at least $9.7 million in the subcommittee's bill for 
fiscal year 2010, in order to meet the Federal Government's obligations 
to the State under the settlement agreement.

                               BACKGROUND

    Upon admission to the Union, States beginning with Ohio and those 
westward were granted by Congress certain sections of public land 
located within the State's borders. This was done to compensate these 
States having large amounts of public lands within their borders for 
revenues lost from the inability to tax public lands as well as to 
support public education. Two of the tracts of State school lands 
granted by Congress to California at the time of its admission to the 
Union were located in what later became the Elk Hills Naval Petroleum 
Reserve.
    The State of California applies the revenues from its State school 
lands to assist retired teachers whose pensions have been most 
seriously eroded by inflation. California teachers are ineligible for 
Social Security and often must rely on this State pension as the 
principal source of retirement income. Typically the retirees receiving 
these State school lands revenues are single women more than 75 years 
old whose relatively modest pensions have lost as much as half or more 
of their original value to inflation.

            STATE'S CLAIMS SETTLED, AS CONGRESS HAD DIRECTED

    In the National Defense Authorization Act for Fiscal Year 1996 
(Public Law 104-106) that mandated the sale of the Elk Hills Reserve to 
private industry, Congress reserved 9 percent of the net sales proceeds 
in an escrow fund to provide compensation to California for its claims 
to the State school lands located in the Reserve.
    In addition, in the act Congress directed the Secretary of Energy 
on behalf of the Federal Government to ``offer to settle all claims of 
the State of California . . . in order to provide proper compensation 
for the State's claims.'' (Public Law 104-106,  3415). The Secretary 
was required by Congress to ``base the amount of the offered settlement 
payment from the contingent fund on the fair value for the State's 
claims, including the mineral estate, not to exceed the amount reserved 
in the contingent fund.'' (Id.)
    Over the year that followed enactment of the Defense Authorization 
Act mandating the sale of Elk Hills, the Federal Government and the 
State engaged in vigorous and extended negotiations over a possible 
settlement. Finally, on October 10, 1996 a settlement was reached, and 
a written Settlement Agreement was entered into between the United 
States and the State, signed by the Secretary of Energy and the 
Governor of California, under which the State would receive 9 percent 
of the sales proceeds in annual installments over an extended period.
    The Settlement Agreement is fair to both sides, providing proper 
compensation to the State and its teachers for their State school lands 
and enabling the Federal Government to maximize the sales revenues 
realized for the Federal taxpayer by removing the threat of the State's 
claims in advance of the sale.

   FEDERAL REVENUES MAXIMIZED BY REMOVING CLOUD OF STATE'S CLAIM IN 
                          ADVANCE OF THE SALE

    The State entered into a binding waiver of rights against the 
purchaser in advance of the bidding for Elk Hills by private 
purchasers, thereby removing the cloud over title being offered to the 
purchaser, prohibiting the State from enjoining or otherwise 
interfering with the sale, and removing the purchaser's exposure to 
treble damages for conversion under State law. In addition, the State 
waived equitable claims to revenues from production for periods prior 
to the sale. The Reserve thereafter was sold for a winning bid of $3.53 
billion in cash, a sales price that substantially exceeded earlier 
estimates.

   CONGRESS SHOULD APPROPRIATE $9.7 MILLION FOR THE FISCAL YEAR 2010 
                 INSTALLMENT OF ELK HILLS COMPENSATION

    The State's 9 percent share of the adjusted Elk Hills sales price 
of $3.53 billion is $317.70 million. To date, Congress has appropriated 
seven installments of $36 million and one installment of $48 million 
that was reduced to $47.52 million by the 1 percent across-the-board 
rescission under the fiscal year 2006 Defense Appropriations Act, for 
total appropriations to date of $299.52 million of Elk Hills 
compensation owed to the State. Accordingly, the Elk Hills School Lands 
Fund should have a positive balance of at least $18.18 million.
    We understand that Department of Energy personnel under the Bush 
administration had proffered four purported grounds for suspending 
further payments of Elk Hills compensation to the State. Each of these 
is a ``red herring''.
    Red Herring No. 1. Finalization of respective equity shares of 
Federal Government and ChevronTexaco as selling co-owners of Elk Hills 
oil field still not completed.--The Bush administration's fiscal year 
2009 budget request stated that ``the timing and levels of any future 
budget request [for Elk Hills compensation] are dependent on the 
schedule and results of the equity finalization process'' between the 
Federal Government and ChevronTexaco to determine the relative 
production over the years from their respective tracts in the Elk Hills 
field. (Fiscal Year 2009 Budget Appendix, at p. 403). But DOE already 
has held back $67 million, including $6.03 million from the State's 
share, to protect the Federal Government's interests in a ``worst case 
scenario'' for this equity process. The State has agreed to a ``hold-
back'' of that amount to protect the Federal Government's interest. 
This reduces the available balance in the Elk Hills School Lands Fund 
to $12.15 million. In addition, DOE's fiscal year 2009 congressional 
budget request detail stated that the equity determination is in its 
final stages: ``Of the four applicable zones [in Elk Hills], the Dry 
Gas Zone and Carneros Zone are finalized. The Stevens Zone [the largest 
in Elk Hills] is expected to be completed in 2008. A final 
recommendation for the Shallow Zone is pending.'' (p. 142). 
Accordingly, remaining uncertainty in the equity process thus provides 
no basis for withholding further payment of the State's Elk Hills 
compensation.
    Red Herring No. 2. There is no money left in the Elk Hills School 
Lands Fund right now.--The Bush administration's fiscal year 2009 
budget request stated: ``Under the Act [that mandated the sale of Elk 
Hills], 9 percent of the net proceeds were reserved in a contingent 
fund in the Treasury for payment to the States. . . . Under the 
settlement agreement, $300 million has been paid to the State of 
California.'' (Fiscal Year 2009 Budget Appendix, at p. 403). The fiscal 
year 1999 budget request at the time of the sale notes that $324 
million was deposited into the Elk Hills School Lands Fund. (Fiscal 
Year 1999 Budget Appendix, at pp. 378-9). A post-sale adjustment to the 
Elk Hills sales price reduced this amount to $317.7 million. 
Accordingly, after deducting the $300 million in payments to the State 
to date and the $6 million hold-back to protect the Federal 
Government's interests in the ``worst case'' scenario for the equity 
process, the Elk Hills Fund has ample funds available for appropriation 
of a further payment of compensation to the State.
    Red Herring No. 3. No payment can be made to the State because of 
pending litigation between ChevronTexaco and DOE.--DOE has pointed to 
pending litigation brought by ChevronTexaco against DOE in the U.S. 
Court of Federal Claims (Docket No. 04-1365C) as a reason to suspend 
further payments to the State. This litigation alleges DOE personnel 
committed misconduct in the equity finalization process by having 
improper ex parte contacts and having the same DOE staff serve as both 
advocate for DOE's position and advisor preparing the decision 
documents for the decisionmaker. However, the California State Attorney 
General has analyzed this litigation and advised that this litigation 
is a claim for money damages for DOE staff misconduct that has no 
effect on the Federal Government's equity share, and so there is no 
effect on the State's share of compensation. Indeed, under the 
governing agreement between DOE and Chevron, Chevron had waived any 
right to contest the final equity determination in court. Hence this 
litigation provides no basis for withholding the rest of the State's 
compensation.
    Red Herring No. 4. No payment can be made to the State because the 
State's share must be reduced by the equity finalization costs and 
environmental remediation costs and the final amount of such costs is 
not yet known.--The State's share of compensation is properly reduced 
by the ``direct costs of sale'' as required by Congress. Since the sale 
took place over a decade ago, those costs are fixed and known. The 
State has agreed to bear its share of these sales expenses. However, 
DOE is seeking to charge against the State's share two additional 
categories of costs--costs of determining the equity ownership and 
environmental remediation--that constitute ongoing costs of operating 
the oil field, not sales expenses. The California State Attorney 
General advises that these do not properly constitute sales expenses 
chargeable against the State's share.
    More specifically, the Settlement Agreement between the Federal 
Government and the State provides that the Federal Government shall pay 
the State ``9 percent of the proceeds from the sale of the Federal Elk 
Hills Interests that remain after deducting from the sales proceeds the 
costs incurred to conduct such sale.'' This reflects the congressional 
direction that, ``In exchange for relinquishing its claim, the State 
will receive 7 [9 in the final legislation] percent of the gross sales 
proceeds from the sale of the Reserve that remain after the direct 
expenses of the sale are taken into account.'' (House Rept. No. 104-
131, Defense Authorization Act for fiscal year 1996, Public Law 104-
106).
    The State has agreed that the $27.13 million incurred for 
appraisals, accounting expenses, reserves report, and brokers' 
commission are appropriate sales expenses. Accordingly, the State's 9 
percent share of these proper sales expenses reduces the available 
balance of the Elk Hills School Lands Fund by $2.44 million to $9.7 
million.
    Costs of conducting the equity adjustment are properly viewed as 
ongoing costs incurred due to the joint operation of the Elk Hills oil 
field by the Federal Government and ChevronTexaco, since the equity 
adjustment already was required under their joint operating agreement 
and related to pre-sale production revenues. Similarly, costs of 
environmental remediation of the Elk Hills field was a cost 
attributable to the prior operation of the field, which created any 
environmental problems that exist. The ongoing operational nature of 
this cost is underscored by the fact that the Federal Government is 
currently engaged in the phased environmental remediation of a Naval 
Petroleum Reserve that it is not selling--NPR-3 (Teapot Dome), as 
evidenced by the fiscal year 2009 budget request.

                               CONCLUSION

    Therefore, of the current Elk Hills School Lands Fund balance of 
$18.18 million, taking into account the ``hold-back'' for worst case 
scenario under equity finalization and deducting the appropriate direct 
costs of conducting the sale, the State respectfully requests the 
appropriation of at least $9.7 million for Elk Hills compensation in 
the subcommittee's bill for the fiscal year 2010 installment of 
compensation, in order to meet the Federal Government's obligations to 
the State under the Settlement Agreement.
                                 ______
                                 
 Prepared Statement of Integrated Building and Construction Solutions 
                             (IBACOS), Inc.

    IBACOS (Integrated Building and Construction Solutions) urges the 
Subcommittee on Energy and Water Development to provide $46 million for 
the Building America Program at the Department of Energy's (DOE) Office 
of Building Technologies in fiscal year 2010 Appropriations under the 
Office of Building Technologies, Residential Building Integration, 
Energy Efficiency and Renewable Energy. We further urge that the 
following language is included to ensure that the competitively 
selected Building America teams are funded at a percentage comparable 
to their historic funding: Of these funds, $35 million shall be 
provided for the research activities of the competitively selected 
Building America research teams, the Building America lead research 
laboratory, and other national laboratories conducting research to 
achieve Building America's specified energy performance targets.
    Residential Buildings currently account for over 20 percent of the 
primary energy consumed by the United States. Each year, more than 1 
million new homes are constructed and over a million are remodeled. 
Significant energy savings can be achieved at minimal increases in 
construction costs provided that a long term and consistent commitment 
is made to work in partnership with the housing industry. DOE's 
Building America Program has developed an industry-driven research 
approach that can reduce the average energy use in new housing by 50 
percent by 2015, providing significant benefits to homeowners in terms 
of reduced utility bills and significant benefits to the U.S. economy 
by maintaining housing as a major source of jobs and economic growth. 
If building in significant energy savings isn't done now, the Nation 
risks using an extravagant amount of energy in the future. In order to 
reduce reliance on foreign energy supplies and to support the 
stabilization of greenhouse gas emissions, we must invest appropriately 
in research in the areas of technology, systems integration, and 
builder processes to upgrade the performance of our housing stock; 
otherwise, we are mortgaging our future.
    Research, development, and outreach activities performed by the 
competitively selected industry Teams in the Building America Program 
are the key element in DOE's strategy to reduce energy consumption in 
residential buildings. The Teams' activities focus on increasing the 
performance of new and existing homes by developing advanced energy 
systems that can be implemented on a production basis, while meeting 
consumer and building performance requirements.
    While the Teams have been working on improving efficiency in 
housing since 1992, with successes being embodied in EPA's Energy Star 
Home program and DOE's Builders Challenge, they are now focused on the 
more difficult goal of creating strategies to achieve Zero Energy Homes 
(ZEH)--homes that produce as much energy as they use on an annual 
basis.

             A NEW FRONTIER IN RESEARCH--ZERO ENERGY HOMES

    The research needed to develop systems and strategies to achieve 
the long term goal of ZEH is not simply applying lessons learned; 
rather, fundamental research is still required. This R&D, performed by 
the Building America Teams, is truly high-risk, high-payoff research.
    The research required to meet the goal of ZEH is costly and high 
risk:
  --Significant basic research is required to develop and integrate new 
        technologies into homes before they are proven effective enough 
        to be applied in the field.
  --This research is costly and risky, and not going to be undertaken 
        by the industry alone.
  --The life cycle of this research is significantly longer than that 
        of comparable industries.
  --The homebuilding industry is extremely fragmented, with 
        homebuilders having little ability to drive research, and a 
        lower than average financial commitment to investing in 
        research.
  --Mechanisms do not currently exist within the homebuilding industry 
        to integrate new technologies and strategies effectively.
    The research required to meet the goal of ZEH is also high-payoff 
for the following reasons:
  --Once constructed, homes have a long lifespan, providing the 
        opportunity for a durable long term reduction in energy use.
  --Effective strategies to reduce energy use will positively impact 
        consumers, as well as the Nation's energy demand.
  --Successful research into integration strategies will allow new, 
        high-risk technologies to be adopted more quickly and 
        effectively.

BUILDING AMERICA COMPETITIVE TEAMS--RESEARCH AND IMPLEMENTATION IN THE 
                               REAL WORLD

    The work of the Teams allows industry leadership to drive cost 
effective solutions that move us towards Zero Energy Homes. Building 
America partners have shown that homes with improved efficiency levels 
can have equal or lower purchase prices than conventional homes, in 
addition to much lower energy bills and operating costs, and increased 
building durability as well as occupant safety, health, and comfort. In 
addition to performing the fundamental research needed to advance the 
energy efficiency of our Nation's housing stock, the Building America 
Teams provide recommendations to a broad range of residential 
deployment partners including the EPA's Energy Star Homes Program, 
HUD's Partnership for Advancing Technologies in Housing Program, DOE's 
Builders Challenge, and many industry associations and universities. 
Furthermore, the Teams are perhaps the best resource for DOE to educate 
the builder community on technology and integration breakthroughs. This 
education has been, in part, demonstrated through successful projects, 
where high efficiency housing is being built and bought, such as 
Summerset at Frick Park (Pittsburgh, Pennsylvania); Noisette (North 
Charleston, South Carolina); Civano (Tucson, Arizona); The Landover 
Group (Virginia and Maryland); Forest Glen development in (Carol 
Stream, Illinois); Hunters Point Shipyard (San Francisco, CA); 
Stapleton (Denver, Colorado); Habitat for Humanity (Georgia, Colorado, 
Tennessee, Florida, Michigan, Texas and throughout the United States); 
Summerfield (San Antonio, Texas); Sun City (Las Vegas, Nevada); and 
others throughout the Nation as documented on www.buildingamerica.gov. 
The more than 500 private sector partners who work with the Teams are 
experts in home construction, building products and supply, 
architecture, engineering, community planning, and mortgage lending. 
All construction material and labor costs for homes and communities 
constructed by Building America Teams are provided by DOE's private 
sector partners.
DOE's Role in the Residential Buildings Research Partnerships
    Catalyzing research in residential construction necessary to 
increase the energy performance, and bringing together industry 
partners to leverage research dollars and expertise.
    Matching advanced product research programs to the system 
integration efforts of the Building America Teams to ensure realistic 
approaches to increasing energy performance.
    Reducing risk and increasing reliability of emerging technologies.
    Providing scientific expertise through the involvement of the 
National Renewable Energy Laboratory (NREL) and other national 
laboratories.
    Sharing critical information about research with several thousand 
associated building industry professionals and leveraging information 
through EPA, HUD, and private sector energy efficiency programs.
Program Goals
    Reduce energy use in America's housing stock by 50 percent by 2015 
and provide ZEH by the year 2025, integrating renewable energy when and 
where practical.
    Research and develop the systems and strategies necessary to allow 
our Nation to deliver high performance houses in order to increase our 
national energy security.
Program Status
    Through the competitively selected Teams, Building America works 
closely with America's lead builders, who produce approximately 50 
percent of the Nation's new housing stock. Additionally, the program 
has been tasked with providing the research and development basis for 
the President's Partnership for Housing Energy Efficiency (PHEE). More 
than 30,000 homes have been constructed in 34 States. Increased funding 
is needed to address new program requirements including increased 
energy efficiency goals, increased need for technical support of lead 
builders, contractors, and suppliers for effective participation in the 
program, expansion of applications in existing building stock, 
expansion to multi-family housing stock, and design for integration of 
on-site and renewable power. Specifically, the incorporation of the ZEH 
goals into Building America research and development activities must be 
done in an integrated fashion via the existing competitively selected 
Building America teams, which have begun to include renewable energy 
technologies and on-site energy into some projects. The stated DOE 
goals of the program are unreachable without significant Team funding.
Recommendation for Fiscal Year 2010 Funding
    Provide $46 million, for the Building America Program at the DOE's 
Office of Building Technologies in fiscal year 2010 appropriations 
(under the Office of Building Technologies, Residential Building 
Integration). Additionally, include language as follows to ensure that 
the competitive teams are funded at a percentage comparable to their 
historic funding:

    ``Of these funds, $35 million shall be provided for the research 
activities of the competitively selected Building America research 
teams, the Building America lead research laboratory, and other 
national laboratories conducting research to achieve Building America's 
specified energy performance targets''.
                                 ______
                                 
                    Prepared Statement of GE Energy

    The following testimony is submitted on behalf of GE Energy (GE) 
for the consideration of the subcommittee during its deliberations 
regarding the fiscal year 2010 budget requests for the Department of 
Energy (DOE). Among GE's key recommendations are:
  --Renewable Energy.--GE supports the fiscal year 2010 increases in 
        Wind and Solar.
  --Fossil Energy.--(1) Increase Coal funding by $75 million for off-
        the-shelf carbon capture plant designs to accelerate the near-
        term deployment of large-scale carbon capture and 
        sequestration; (2) provide $45 million for Advanced Turbines in 
        fiscal year 2010 support of advanced IGCC with carbon capture; 
        (3) restore funding for water-related R&D activities.
  --Nuclear Energy.--Additional funding is needed for loan guarantees, 
        to support new nuclear plant development.

                            RENEWABLE ENERGY

    DOE has played a critical role in the development of renewable 
energy technologies over the past three decades. The fiscal year 2010 
budget request proposes $75 million for Wind and $320 million for 
Solar, representing 36 percent and 83 percent increases, respectively, 
from fiscal year 2009 appropriations. GE welcomes these funding 
increases as critical investments in the transformation of the Nation's 
energy infrastructure. We continue to believe that these appropriations 
must be sustained and increased over time. The American Wind Energy 
Association has recommended that annual Wind appropriations of $200 
million are needed to meet the 20 percent wind by 2030 scenario. The 
fiscal year 2010 budget request is an important step in this direction.
    DOE proposes to utilize the $20 million increase in Wind program 
funds to accelerate offshore wind technology development and improve 
the reliability and cost performance of land-based wind turbines; 
improve grid integration; and support efforts related to workforce 
development, wind-radar mitigation efforts, education, and community 
applications. GE has recommended that the DOE focus its Wind program on 
performance, reliability and grid integration, particularly in areas 
such as blade manufacturing; drivetrain technology; and grid operator 
solutions such as managing variability, ramp rate control, frequency 
regulation, and fault response. We support these new funds as critical 
investments toward achieving the 20 percent wind scenario while 
building U.S. technology and supporting increased U.S. jobs.
    The proposed $145 million increase in Solar program funds includes 
substantial increases in Photovoltaic and Concentrating Solar Power 
R&D, as well as additional investments in systems integration, market 
transformation, and PV manufacturing. GE has recommended that the DOE 
focus its Solar program on improving PV module cost, reliability, and 
efficiency performance, particularly with regard to thin film PV 
technology; and on advanced controls and diagnostics to support the 
grid integration of solar assets. We support these funding increases as 
essential for realizing the DOE's goal of deploying 5-10 gigawatts of 
solar by 2015.

                             FOSSIL ENERGY

    Commercial Scale CCS Demonstrations.--Demonstration of CCS at 
commercial scale is urgently needed to demonstrate to the public that 
geologic sequestration of CO2 is a safe and environmentally 
acceptable solution for low carbon coal power. The continued use of our 
Nation's abundant coal resources requires proving that integration of 
power plants and sequestration resources can provide competitive and 
reliable electrical generation.
    CCS Deployment.--GE recommends that DOE focus support on the near-
term deployment of large-scale, utility CCS. In its fiscal year 2010 
budget request, the DOE described the $3.4 billion provided through the 
American Recovery and Reinvestment Act (``ARRA'') as the foundation of 
its clean coal program. However, of the $3.4 billion, the only certain 
funding that will be made available for utility CCS projects is the 
$800 million that will be provided for Round 3 of the Clean Coal Power 
Initiative. Much more is needed. GE is a member of the US Climate 
Action Partnership (USCAP), which recommended in its ``Blueprint for 
Legislative Action'' (January 2009) that a Federal CCS program 
establish at least five (5) gigawatts (GW) of CCS-enabled coal fueled 
facilities. Such a level of CCS deployment is needed to support 
implementation of coal performance standards that are key to achieving 
national greenhouse gas reduction goals. Even if CCPI Round 3 funds can 
be combined with other funding mechanisms for utility projects (e.g. 
EPAct 2005 section 48A Investment Tax Credits, loan guarantees and 
section 48Q CO2 production credits), funding falls well 
short of that necessary to offset the additional capital and several 
years of additional operating costs of 5GW of utility CCS. While 
funding sufficient for 5GWs is not likely without new legislation, DOE 
can provide incentives to help remove barriers and accelerate CCS 
deployment.
    Therefore, GE recommends that DOE fiscal year 2010 Coal funding be 
increased by $75 million (to $478.9 million) to fund the development of 
off-the-shelf Front-End Engineering Designs (FEEDs) for IGCC Greenfield 
plants optimized for CCS for Bituminous and Western coals. IGCC is 
ready for carbon capture now, but only needs the detailed engineering 
to support commercial proposals. Funding of FEEDs should accelerate 
development of commercial CCS projects and reduce the difficulty of 
obtaining approval from State regulators for recovery of project 
development costs. The development of these FEEDs will also deliver 
immediate and foster long-term job creation.
    Geologic Sequestration.--Another significant barrier to the 
deployment of first-mover CCS projects is the uncertainty associated 
with availability of geologic storage. Comprehensive and expensive 
geologic characterization is necessary to ensure that a plant will have 
a sequestration resource with sufficient capacity for a 30-40 year 
life. As with up-front engineering costs, public utility commissions 
are reluctant to approve cost recovery of studies relating to the 
availability of geologic storage, although they are necessary to assure 
project viability. Therefore, GE recommends that DOE fiscal year 2010 
Carbon Sequestration funding be increased by $100 million (to $279.9 
million) for co-funding of detailed geologic characterization to more 
fully validate storage sites for commercial CCS projects that are 
starting development.
    FutureGen.--GE has three recommendations for the structure of the 
FutureGen program that will significantly improve its value in moving 
CCS forward: First, make the successful demonstration of integrated 
carbon capture and sequestration the primary focus of FutureGen. 
Reliable CO2 production is essential to a successful 
sequestration demonstration. Second, FutureGen must demonstrate 
commercially relevant coal power generation with CCS. Carbon capture 
using gasification is widely performed economically and reliably in the 
commercial chemical process industry. The FutureGen project should 
incorporate technology and equipment in a design configuration that is 
representative of commercial practice in order to provide critical 
experience on integration of capture and sequestration at a commercial 
scale. Third, and as is essential to achieving the two foregoing goals, 
we recommend that FutureGen be contracted on a commercial and 
competitive basis for the design and construction of the plant and its 
sequestration facility. FutureGen can draw from existing experience and 
investment and avoid duplication of engineering costs. Carbon capture 
using gasification is widely performed economically and reliably in the 
commercial chemical process industry. GE has invested substantially in 
the development of its standard 630MW IGCC plant and an ancillary 
Carbon IslandTM for carbon capture. A commercial contract 
with its guarantees and warrantees will provide the performance, 
schedule and cost certainty with reliable CO2 supply for 
sequestration that FutureGen needs to achieve its primary goal of 
successful sequestration with reliable power generation.
    Advanced Turbines.--GE recommends that annual funding of $45 
million be provided in fiscal year 2010 to maintain needed progress in 
the Advanced Turbines. The Advanced Turbines program represents the 
Department's high priority research effort focusing on the development 
of enabling technologies for high efficiency hydrogen turbines for 
advanced gasification systems with carbon capture. It is on target to 
enable future advanced IGCC coal fueled power plants to offset much of 
the performance penalties associated with carbon capture while also 
achieving very low NOX emissions. In addition to benefiting 
future coal IGCC applications, the technologies that come out of this 
program will also benefit existing and future natural gas combined 
cycle power plants. Improved efficiency of these applications will mean 
reduced emissions and reduced CO2 for the same power output. 
This improvement would be by either implementing the technology on new 
advanced products or retrofitting the technology into existing gas 
turbines. A one point improvement in efficiency on GE's existing F-
class fleet would result in 4.4 million tons less of CO2 
emissions per year.
    Water.--Large amounts of water are needed to produce or extract 
energy, and large amounts of energy are needed to treat or transport 
water. This co-dependency is called the Water/Energy Nexus. In order 
for the DOE to achieve its aggressive goals of reducing freshwater 
withdrawals and consumption 50 percent by 2015 and 70 percent by 2020, 
water related R&D funding is needed. GE recommends water-related 
funding under Innovations for Existing Plants be restored and 
significantly increased above the $12 million allocated under the 
fiscal year 2009 budget. Funding for R&D and demo projects including: 
Non-traditional Waters for Cooling Make-up, Water Reuse and Recovery, 
Advanced Cooling Technologies, and Water Treatment and Detection will 
help to ensure DOE's goals are met. GE also recommends $40 million be 
allocated to innovative water reuse technologies and demonstration 
projects in the production of oil and natural gas to further reduce 
environmental impacts and operational costs of upstream energy 
processes. Support is also needed to advance reuse/treatment 
technologies for the conversion of impaired wastewater streams into 
sources of renewable water in areas of water scarcity, reducing the 
need to use energy to transport water over long distances and to 
support electricity generation.

                             NUCLEAR ENERGY

    Nuclear power plant operation provides baseload energy generation 
with no greenhouse gas emissions. Each operating nuclear plant avoids 
the production of 8 million tons of CO2 annually and in 
total the U.S. fleet of 104 reactors avoids nearly 1 billion tons of 
CO2 annually. GE supports the use of nuclear energy as part 
of a diverse portfolio of power generation technologies and fuels.
    Loan Guarantees and New Plant Development.--Federal investment has 
been instrumental in the licensing and partial development of 
standardized designs for advanced light water reactors and has helped 
form the foundation for a nuclear renaissance through programs such as 
the NP2010 program. In addition to the continuation of existing 
programs, more actions are required to ensure successful 
commercialization of new nuclear technologies. The Energy Policy Act of 
2005 authorized loan guarantees to support advanced nuclear energy 
facilities. Due to the capital-intensive nature of nuclear plant 
deployment, these loan guarantees are key to the ability of utilities 
to attract financing and move forward with this clean, carbon-free 
technology. The current credit crisis in the United States makes it 
increasingly difficult to finance these and other capital-intensive 
projects. The original $18.5 billion in available loan guarantees is 
sufficient to support 2 to 3 new nuclear projects. DOE has already 
received applications for significantly more than that number of 
projects and to have meaningful progress on both climate change and 
energy security certainly more are needed. Based on this level of 
industry demand, the benefit to be derived, and the fact that these 
loan guarantees are self-funded and have no budget impact, GE supports 
an additional $50 billion in authorized loan guarantees through the 
DOE's Loan Guarantee Program for nuclear power facility projects.
    Energy Parks--Research and Development for Commercial Deployment.--
GE believes that a strong private public partnership should be formed 
to support the Energy Park concept outlined as part of the Office of 
Environmental Management's efforts for footprint reduction of the 
legacy DOE sites. GE believes that the installment of advanced light 
water reactors and research and development to support advanced 
recycling at the existing DOE sites in the Energy Park concept is a 
logical application for these locations. These sites are well 
understood from a permitting aspect and their existing workforce has 
skills that would be directly transferrable to commercial nuclear power 
applications. The Environmental Management office has received funding 
under ARRA. GE supports near term actions as part of this program 
including the community outreach, permitting, siting, design, and 
license application development for new nuclear reactors.
    Non-proliferation and Waste Minimization.--GE supports used nuclear 
fuel recycling as a means to close the fuel cycle, to minimize nuclear 
proliferation risks and provide an alternative to Yucca Mountain. As 
the Nation explores solutions to nuclear waste issues, GE supports and 
seeks an opportunity to participate in the soon to be formed Blue 
Ribbon Waste Panel. The GE team has decades of experience in nuclear 
methods and designs based on U.S. technology that are available to 
close the nuclear fuel cycle. It is in the best interests of national 
security that U.S. technology be used to close the fuel cycle in a 
manner that does not result in separated plutonium.

                        ARPA-E; LOAN GUARANTEES

    GE supports the DOE's budget request for $10 million in program 
direction to support the new ARPA-E program ($400 million appropriated 
through the ARRA) to advance disruptive, high-risk and high-potential 
technologies.
    GE also supports $43 million ($6 billion appropriated through the 
ARRA) for the temporary Loan Guarantee Programs (LGP). Rapid 
implementation of the LGP is central to the recovery of the renewable 
energy industry, and these program operation and personnel funds 
deserve full and immediate support.
                                 ______
                                 
    Prepared Statement of the Alliance for Materials Manufacturing 
                           Excellence (AMMEX)

    The Alliance for Materials Manufacturing Excellence (AMMEX) 
welcomes this opportunity to provide its input to the subcommittee on 
the proposed budget for fiscal year 2010 for the Industrial 
Technologies Program (ITP) at the Department of Energy. AMMEX is a 
coalition of organizations representing the basic materials 
manufacturing sector (aluminum, chemicals, forest products, glass, 
metal casting, steel) in the U.S. economy along with key stakeholders 
in materials manufacturing, such as the Northeast Midwest Institute, 
the National Association of State Energy Officials and the American 
Council for an Energy-Efficient Economy.
    We are writing to urge Congress to increase the funding to the ITP 
to the level of $150 million and to restore the structure of the 
program to one that emphasizes new process development in individual 
materials industries, including the six historically funded by this 
effort, as opposed to the currently proposed cross-cutting research 
approach. These changes would bring the program into alignment with 
Congress' intent in both section 452 (Energy Intensive Industries 
Program) of the Energy Independence and Security Act of 2007, which was 
signed into law on December 19, 2007, as well as the Energy Efficiency 
and Renewable Energy Act of 2007, which passed the House unanimously on 
October 22, 2007.
    The member organizations of AMMEX have been partners with ITP since 
the inception of the program's cooperative, industry-specific research 
activities. These research activities are a true public-private 
partnership. DOE and materials manufacturers jointly fund cutting-edge 
research that addresses the needs of the Nation and materials 
manufacturers. All projects have the shared goals of reducing energy 
consumption, reducing environmental impact, and increasing the 
competitive advantage of U.S. materials manufacturers.
    Reducing our need for oil imports, developing an economy that is 
sustainable in energy supply, and reducing our environmental impact are 
important national policy goals. There is no more effective way to 
achieve these goals than through energy efficiency. The lowest cost, 
cleanest, and most reliable energy is the energy that is not consumed 
because of improved efficiency. By reducing the energy intensity of 
materials manufacturing and accelerating the delivery of new 
technology, ITP has helped make U.S. materials manufacturers more 
competitive in global markets, preserving and creating good-paying jobs 
in the process. The program is unique because it selects only projects 
with ``dual benefits'': a public benefit such as reduced emissions or 
energy use justifies the Federal funding, and an industry benefit such 
as a more efficient process or improved product justifies the 
industrial funding.
    U.S. materials manufacturing continues to face challenges resulting 
from increased cost and decreased availability of traditional energy 
supply resources. These challenges have stimulated innovation in the 
materials manufacturing sector in order to create significant energy 
improvements and to diversify energy supplies. While the innovations of 
the past have brought materials manufacturing a long way, the sector 
cannot go further without new innovations. To this end, the materials 
manufacturing processes must be transformed; new processes and new 
innovations must be developed which will consume far less energy and 
that will be able to utilize diverse forms of energy.
    To accomplish these goals, the Federal Government and industry will 
need to re-embark upon a joint effort to broaden and accelerate 
inherently high-risk research, development, and deployment of new 
materials manufacturing processes that utilize diverse energy sources. 
This effort will also allow the materials manufacturing sector to 
lessen dependence on natural gas, oil, and conventional electricity 
sources, thus benefiting consumers through contribution to a stable 
energy market.
    Dramatic increases in industrial energy prices and growing global 
competition threaten the vitality and the future of U.S. materials 
manufacturing. Unless this trend is reversed, American manufacturing 
jobs in these key industries will increasingly move overseas. 
Manufacturers have responded to such challenges in the past by applying 
the power of innovation to create new products and processes that 
sustain the foundation of the U.S. economy.
    Our request for funding in fiscal year 2010 for ITP entails two 
parts:
  --An increase to a total program level of $150 million, as authorized 
        in the Energy Independence and Security Act of 2007.
  --A re-structuring of the program so as to return to the structure 
        that was so successful from 1990 to 2003--a balanced portfolio 
        of research from the point of view of research impact; i.e., a 
        greater focus on energy intensive industrial processes. For the 
        2010 budget, we request that the Industries of the Future 
        industry-specific R&D be increased to $30 million. We further 
        recommend that in future budgets at least 50 percent of the 
        funding go to research into new process development where the 
        energy savings potential in industry is highest.
    Figure 1 below is representative of the gains in energy efficiency 
made by materials manufacturers since 1990, when they began partnering 
with ITP.




    This chart shows that materials manufacturing processes have become 
increasingly efficient from 1990 to 2000, and that new process 
developments are required to continue making similar gains in the 
future.
    Between 1990 and 1996 the program consisted largely of ``industry-
specific'' funding and averaged $100 million annually. There were some 
``cross-cutting'' projects in this time, but they were a relatively 
small percentage of the total. As the program grew, spending still 
remained focused on industry-specific projects. Figure 2 below shows 
the funding history of the DOE ITP program since 1998.




    Figure Notes:
  --IAC and Distributed Generation funding are subsets of ``Cross 
        Cutting RD&D''
  --``Other Funding'' includes management and technical planning and 
        support, as well as other funding not listed under ``Industry-
        Specific'' or ``Cross Cutting'' in budget documents. The $50 
        million ``Other Funding'' in 2009 is for information and 
        communications technology efficiency.
  --2010 AMMEX recommendation includes: $30 million for Industry 
        Specific R&D, $65 million for Cross Cutting RD&D (including $8 
        million for the IAC program), and $55 million for Distributed 
        Generation.
    By 2004, ITP was not only the target of drastic cuts, but remaining 
funds were rebalanced to favor cross-cutting projects over industry-
specific projects as well. While Figure 1 shows that new process 
developments are needed to improve the energy efficiency of materials 
manufacturing industries, Figure 2 shows that these necessary funding 
levels are not being met. A recent peer review of the program indicated 
that the technology pipeline for R&D projects is now running dry. It is 
imperative to fund these programs now, as it takes time to refill the 
pipeline and achieve additional energy savings.
    AMMEX members that DOE has recently supported have identified their 
top new process development concepts, not listed in order of priority, 
which would be pursued at the funding levels and structure defined 
above:
Aluminum
  --Improved energy-efficient burners and furnaces for aluminum 
        melting.
  --Improved energy efficiency and recovery rates for recycling 
        technologies.
Chemicals
  --Development of alternative feedstocks for the chemical industry to 
        reduce dependence on petroleum and natural gas derived 
        feedstocks.
  --Nano-manufacturing scale-up methodologies for key unit operations: 
        synthesis, separation, purification, stabilization, and 
        assembly.
  --Development of low-energy, low-capital membrane or hybrid 
        separations technology.
Glass
  --Submerged Combustion Melter.
  --Waste Heat Recovery and Use as Electrical or Chemical Energy.
  --Increase glass strength (towards theoretical) to reduce weight and 
        energy per unit made.
Forest Products
  --Energy-efficient pulping and papermaking.
  --Eliminating use of fossil fuels in manufacturing.
  --Significantly reducing fresh water consumption in pulp and paper 
        mills.
Metal Casting
  --Net Shaped Manufacturing through Advanced Lost Foam Casting 
        technologies.
  --Smart coatings and advanced surface treatments for energy efficient 
        tooling technologies.
  --Disruptive approaches for nano-composites for lighter weight cast 
        components.
  --High Strength Steels for improved service performance.
Steel
  --Ironmaking by Molten Oxide Electrolysis.
  --Ironmaking by Flash Smelting using Hydrogen.
  --Demonstration of the Paired Straight Hearth Furnace Process.
    Other industries, such as cement, would benefit from expanded R&D 
as well, but have not been engaged with the Department.
    The United States also faces serious shortages in the science and 
engineering workforce that is needed to keep our Nation's competitive 
edge in world markets through technology innovation and timely 
application. There is a clear need for a reinvigoration of our 
commitment to technology education. Advanced R&D projects are often 
undertaken in conjunction with major American research universities. 
These projects help to expose students to the kind of research 
necessary to serve the future energy efficiency needs of industry. 
Other ITP efforts such as the Industrial Assessment Center program 
complement this R&D funding by helping to train this future workforce.
    Our proposal to the subcommittee is an effort to both rebuild 
America's materials manufacturing industries and revitalize our science 
and engineering institutions. It builds a new public-private 
partnership to support these twin goals, and will ensure that the U.S. 
materials manufacturing industry will remain vital and competitive 
through:
  --Accelerating technology innovation to ensure the future 
        competitiveness, resource efficiency, and sustainability of our 
        domestic materials manufacturing industry;
  --Building the vital intellectual infrastructure in American 
        universities and laboratories that will work in partnership 
        with the materials manufacturing industry; and
  --Maintaining a healthy American materials manufacturing base, which 
        is vital to our national security.
    On behalf of the AMMEX coalition, we thank you for the opportunity 
to submit this statement. We look forward to continuing to work with 
the subcommittee as you move forward on the fiscal year 2010 
Appropriations legislation for the Department of Energy.
                                 ______
                                 
      Prepared Statement of the American Society for Microbiology

    The American Society for Microbiology (ASM) is pleased to submit 
the following testimony on the fiscal year 2010 appropriation for the 
Department of Energy (DOE) science programs. The ASM is the largest 
single life science organization in the world with more than 43,000 
members. The ASM mission is to enhance the science of microbiology, to 
gain a better understanding of life processes, and to promote the 
application of this knowledge for improved health and environmental 
well-being.
    The DOE Office of Science funds basic research in support of the 
DOE's mission of energy security, national security, and environmental 
restoration. Research supported by the Office of Science encompasses 
such diverse fields as materials sciences, chemistry, high energy and 
nuclear physics, plasma science, biology, advanced computation, and 
environmental studies.
    The ASM supports the administration's pledge to substantially 
increase funding for basic science research and scientific user 
facilities and urges Congress to fund the DOE office of science at $5.2 
billion for fiscal year 2010, an 8 percent increase.
    We commend Congress for the substantial and much needed funding for 
the DOE in the American Recovery and Reinvestment Act of 2009 and the 
Omnibus Appropriations Act of 2009. The need remains, however, for a 
steady and reliable increase of fiscal year appropriations to provide 
real growth for DOE science budgets in future years.

              BIOLOGICAL AND ENVIRONMENTAL RESEARCH (BER)

    Operating within the DOE Office of Science, the BER division 
facilitates the growth of a strong science based platform to continue 
to work with national laboratories, universities and private 
institutions to harness the capabilities of microbial and plant 
systems. A fundamental task of the BER is supporting and providing 
research for the President's National Energy Plan. Research from BER 
contributes to developing cost-effective, renewable energy, increasing 
the Nation's energy security, and works to slow or stop increases in 
atmospheric carbon dioxide among other crucial priorities.
    The ASM urges Congress to support an increase for the BER on par 
with the overall increase in fiscal year 2010 funding for the Office of 
Science.
    Research on microbes contributes advances to critical technologies 
and processes necessary for addressing the Nation's great energy and 
environmental challenges in a number of ways:
  --Carbon Sequestration.--Microbes offer multiple possibilities for 
        enhancing carbon sequestration, a process that can reduce 
        CO2 accumulation in the atmosphere. These options 
        include enhancing plant growth, some of which may be used for 
        biofuels, and promoting carbon storage belowground. The latter 
        process involves manipulation of microbial communities and 
        activities to help stabilize organic carbon in soils.
  --Environmental Remediation.--Microbes play major roles in modifying 
        sub-surface environments, where many major pollutants 
        accumulate and are subsequently dispersed. Microbial activities 
        affect the chemical form and movement of many contaminants. The 
        work of various research groups has shown that microbes can be 
        manipulated to directly or indirectly provide potential cost-
        effective bioremediation strategies for immobilizing 
        contaminants. For instance, two different microbes, Shewanella 
        and Geobacter, transform toxic metals such as uranium from a 
        soluble form that moves in groundwater, to an insoluble form 
        that can then be recovered for decontamination. These and other 
        microbes also decontaminate many other metals, radionuclides 
        and toxic chemicals.
  --Renewable Energy.--A greater understanding of the process by which 
        crude oil is transformed into methane, or natural gas, opens 
        the door to recovering clean-burning methane directly from 
        deeply buried or in situ oil sands deposits. A recent study 
        demonstrated methane production from anaerobic hydrocarbon 
        degradation; these findings offer the possibility of 
        ``feeding'' specific hydrocarbons to microbes and rapidly 
        accelerating their conversion into methane. Additional research 
        has shown that hydrogen can be produced from partly degraded 
        oil, and used with CO2 to form methane. This paves 
        the way for using the microbes to capture this CO2 
        as methane, which could then be recycled as fuel in a closed-
        loop energy system.
    Microbial enzymes are also important sources of catalysts for 
conversion of plant biomass, including cellulose and lignins to 
biofuels (e.g., ethanol and butanol). Continued support of basic 
microbiological research is essential for ensuring that the potential 
for biomass as a source of renewable, alternative fuels can be 
realized.

                             GENOMICS: GTL

    The Genomics.--GTL program supports basic research in plant and 
microbial systems biology and explores microbes and plants at the 
molecular cellular and community levels. The ASM supports an increase 
in funding for GTL in fiscal year 2010 to allow it to continue to 
advance DOE wide missions in environment, climate and energy.
    The GTL goal remains to expand insights about fundamental 
biological processes and a predictive understanding of how living 
systems operate. This understanding, linked with DNA sequences and 
widely available, will catalyze the translation of science to new 
technologies for application in energy and environmental issues.
    The GTL works with the DOE Joint Genome Institute (JGI), one of the 
world's largest and most productive public genome sequencing centers, 
to map genomes of microbes and fungi that degrade biomass or impact 
plant productivity. This relationship has created a vital knowledge 
base within the DOE from which scientists are able to purposefully 
redesign proteins, biochemical pathways, and even entire plants or 
microbes to help solve bioenergy challenges.
    Three GTL Bioenergy Research Centers were established in 2007, the 
Bioenergy Science Center, the Great Lakes Bioenergy Research Center, 
and the JGI. These centers, which are actively working toward making 
the production of biofuels more efficient, less costly, and 
commercially viable; results of ongoing studies are changing the way we 
think about biotechnology, and transforming how we power our Nation. 
The centers are creating knowledge underlying three grand challenges 
faced by biology within the DOE mission: (1) development of the next-
generation bioenergy crops; (2) discovery and design of enzymes, and 
microbes with novel biomass degrading capabilities; and (3) discovery 
and design of microbes that transform fuel production from biomass. 
Meeting these challenges will benefit all biological research efforts.
    Areas of emphasis in Genomics: GTL include:
    Bioenergy Production.--A broad range of research has been 
undertaken to optimize bioenergy production from a variety of renewable 
sources. Past and ongoing research has made significant progress in a 
number of areas: understanding the details of plant biomass structures 
and how they might be manipulated to improve conversion to biofuels; 
discovery of novel enzymes for improving conversion of biomass to 
biofuels; understanding the details of plant and microbial metabolism 
at a level that promotes controlled synthesis of desired end-products.
    Environmental Remediation.--Research sponsored by Genomics: GTL has 
made major progress in understanding the functions and behavior of 
specific microbes (e.g., Geobacter and Shewanella) and microbial 
communities that play important roles in strategies for remediating a 
wide range of environmental problems, including clean-up of toxic 
wastes and radioactive materials. This work integrates from microbial 
genomes through the functions of microbes in the environment, and 
provides a foundation for altering microbial activities for to solve 
specific problems.
    Carbon Cycling.--Microbes play major roles in the transformation of 
carbon in natural systems. Some of these transformations can promote 
carbon sequestration, while others produce greenhouse gases. Genomics: 
GTL research helps understand how complex microbial communities 
function in nature, and how these communities respond to changes and 
stresses. This information is not only critical for developing 
predictions of microbial responses to climate and other environmental 
changes, but is essential for developing approaches for managing those 
responses to minimize adverse impacts of change.
    The ASM urges Congress to fully support the GTL program with 
increased funding to JGI. In fiscal year 2009, the President's budget 
request included $162.7 million in funding for GTL, but significantly 
cut funding for JGI by $5 million. It is imperative to ensure that 
funding increases are seen for both of these vital programs in fiscal 
year 2010.

              ENVIRONMENTAL REMEDIATION SCIENCES DIVISION

    The Environmental Remediation Sciences Division (ERSD) within BER 
sponsors and supports fundamental scientific research to understand the 
complex physical, chemical, and biological properties of contaminated 
sites in order to develop new solutions for environmental remediation. 
DOE is responsible for the largest, most complex, and diverse 
collection of environmental remediation challenges in the Nation. ERSD 
supports two major activities: (1) the Environmental Remediation 
Sciences Program (ERSP), which seeks to provide the fundamental 
scientific knowledge needed to address challenging environmental 
problems that impede the remediation of contaminated environmental 
sites; and (2) the Environmental Molecular Sciences Laboratory (EMSL), 
which is a national scientific user facility that provides integrated 
experimental and computational resources for discovery and 
technological innovation in the environmental molecular sciences to 
support the needs of DOE and the Nation.
    DOE's remediation challenges occur in the field where highly 
interactive natural processes acting over a broad range of scales 
control the fate and transport of contaminants. The ERSD goal is to 
help provide the basis for development of innovative remediation 
measures to support decisionmaking critical to long-term stewardship. 
Of the 144 sites where DOE has remediation, waste management, or 
nuclear materials and facility stabilization responsibilities, nearly 
100 have soils, sediments, or groundwater contaminated with 
radionuclides, metals, or organic materials.
    The ASM urges Congress to fully support ERSD, which will help 
support DOE's goal to ``provide sufficient scientific understanding 
such that DOE sites would be able to incorporate physical, chemical and 
biological processes into decisionmaking for environmental remediation 
and long-term stewardship.''

                           ENERGY BIOSCIENCES

    The ASM supports increased funding for the Energy Biosciences 
program within the Basic Energy Sciences Division of Chemical Sciences, 
Geosciences, and Biosciences. The Energy Biosciences (EB) program 
within the Basic Energy Sciences (BES) division supports fundamental 
research to promote the development of future energy-related 
technologies. There is a specific emphasis in research on plant and 
non-medical microbial energy transduction systems. The EB program 
provides a fundamental understanding of the complex processes that 
convert and store energy in living systems and impacts numerous DOE 
interests, enhanced biofuel production strategies, next generation 
energy conversion/storage devices, and efficient and environmentally-
friendly catalyst development in particular.
    In fiscal year 2009, EB was divided into two separate programs:
    Photosynthetic Systems.--This program is focused on fundamental 
research to elucidate the specific mechanisms by which plants and 
microbes convert solar energy into chemically-stored forms of energy. 
Results from this new program will create a foundation for the 
development of enhanced biological and engineered systems to harvest 
solar energy, thus contributing to the Nation's goal of energy 
independence.
    Physical Biosciences.--This program combines tools and approaches 
from the physical sciences with the disciplines of molecular biology 
and biochemistry to create new understandings of the detailed 
mechanisms for energy storage and use in plants and microbes. Results 
for this new program will promote the development of improved systems 
for harvesting energy in multiple forms and enhancing their use for 
human needs.

                         WORKFORCE DEVELOPMENT

    Scientific research and subsequent discovery is vital for the 
Nation to remain competitive in the global economy and ensuring support 
for a well trained workforce of teachers and scientists at all levels, 
is imperative. The ASM supports increased funding for Workforce 
Development for Teachers and Scientists within the DOE Office of 
Science which funds undergraduate research internships, graduate and 
faculty fellowships, pre-college activities, laboratory equipment 
programs, and teacher programs.

                               CONCLUSION

    The ASM supports increased funding for the DOE Office of Science in 
fiscal year 2010, and urges Congress to provide adequate funding for 
the BER, ERSD, and Genomics: GTL, and the JGI, which are essential to 
DOE's mission. The DOE Office of Science programs enhance United States 
competitiveness through fundamental research and advanced scientific 
breakthroughs that revolutionize the Nation's approach to challenging 
energy and environment challenges.
    The ASM appreciates the opportunity to provide written testimony 
and would be pleased to assist the subcommittee as it considers the 
fiscal year 2010 appropriation for the DOE.
                                 ______
                                 
 Prepared Statement of the American Association of Petroleum Geologists

    To the Chair and members of the subcommittee, thank you for this 
opportunity to provide testimony on the importance and need for strong 
Federal R&D efforts in the fields of oil and natural gas, coal, and 
geothermal technologies. These activities reside in the U.S. Department 
of Energy's fossil energy program (oil, natural gas, coal) and energy 
efficiency and renewable energy program (geothermal). They are an 
essential investment in this Nation's energy security.
    The American Association of Petroleum Geologists (AAPG) is the 
world's largest scientific and professional geological association. The 
purpose of AAPG is to advance the science of geology, foster scientific 
research, and promote technology. AAPG has nearly 34,000 members around 
the world, with roughly two-thirds living and working in the United 
States. These are the professional geoscientists in industry, 
government, and academia who practice, regulate, and teach the science 
and process of finding and producing energy resources from the Earth.
    AAPG strives to increase public awareness of the crucial role that 
geosciences, and particularly petroleum geology play in energy security 
and our society.
    Our members have a big job. Fossil fuels supply 87 percent of the 
world's total energy needs, down only 4 percent in the past quarter 
century. Transportation represents about 30 percent of end use demand 
and is dominated by liquid fuels derived from oil. Heating is another 
30 percent and dominated by oil and natural gas. Electricity represents 
the remaining 40 percent with a broadening portfolio of fuel sources. 
Coal, nuclear, and natural gas currently dominate electricity 
production, but alternatives like wind are growing rapidly. However, 
because electricity demand is also growing, alternatives remain a small 
fraction of total production.
    Today's energy debate is often framed as a choice between fossil 
fuels or alternative (non-fossil) fuels, or between fossil fuels and 
the environment, but these are red herrings. Sustaining a healthy U.S. 
and global economy, and thus enabling substantial investment in our 
environment, requires a stable and continuous supply of fossil fuels 
while simultaneously developing and expanding alternative and new 
fuels. This is the bridge to our energy future. We need both, and the 
process of building this bridge will take 25 to 40 years, perhaps 
longer. Our Nation's energy policies and investments must reflect this 
reality.
    For example, President Obama's fiscal year 2010 budget includes the 
rollback of a series of tax provisions currently available to the oil 
and gas industry, which is dominated today by the U.S. independent 
producer. It also proposes assessing new fees and taxes on oil and 
natural gas producers, and repealing the ultra-deepwater and 
unconventional research programs.
    Compounded by a weak economy and limited access to capital, these 
proposed policies on top of an already heavily taxed industry would 
have a chilling effect on oil and natural gas drilling, production, and 
energy investment in this country, cost many jobs, and directly 
undermine U.S. energy security.
    The United States tried this experiment from 1980-1988 with the 
windfall profits tax which, compounded with the drop in price of oil in 
the 1980's, had a disastrous effect on drilling, industry employment 
and U.S. energy production for nearly two decades to follow. We face a 
very similar price situation now and cannot afford to repeat an 
experiment that has already been tried and failed.
    These either/or policy choices fail to recognize that as we bridge 
to an alternative energy future, we must preserve and even strengthen 
the fossil energy foundation underlying it. Research and development 
investments are critical to developing alternative and new fuel 
sources, but are also needed in fossil energy to develop the science 
and technology to ensure their future availability.

               OIL AND NATURAL GAS TECHNOLOGIES PROGRAMS

    The oil and natural gas technology research programs at DOE have 
received grossly inadequate appropriations for many years. In fact, in 
fiscal year 2009 Federal oil and natural gas R&D represented a 
miniscule proportion of total energy R&D expenditures, while, 
ironically, oil and natural gas combined contribute 65 percent to our 
Nation's energy portfolio.
    President Obama's fiscal year 2010 budget request continues this 
ill-advised pattern by proposing to eliminate DOE's petroleum-oil 
technologies program, funded at $5 million in fiscal year 2009, and 
increasing by $5 million the natural gas technologies program (for a 
total program of $25 million) to study natural gas hydrates.
    Instead, these programs should be increased substantially to ensure 
the technology will be available to find, develop, and produce these 
natural resources.
    Criticisms of these research programs are frequently couched in 
terms of ``corporate welfare'' or a notion that the private sector 
should support all oil and natural gas research on its own. But these 
charges reveal a fundamental misunderstanding of several important 
trends:
  --The transition to non-fossil fuel alternative energies will take 
        much longer than a few decades. Alternatives are currently more 
        expensive, less reliable and simply cannot meet the scale of 
        energy demand. To try to force the United States on a different 
        course than the rest of the world, at a cost of literally 
        trillions of dollars, will disadvantage the United States at a 
        minimum and worse further hurt the U.S. economy.
  --Increasingly, domestic oil and natural gas production is shifting 
        to non-traditional (unconventional) resources, such as the 
        Barnett Shale in Texas or the Bakken formation in the Williston 
        basin. These resources are different from the conventional 
        resources of the past and hold great promise, but realizing 
        that potential requires significant R&D and technology 
        development. Each resource has unique challenges and if the 
        United States is to leverage their global potential it must 
        invest accordingly and substantially.
  --Over the past decade the United States has added substantial 
        natural gas reserves with a net increase on the order of 15 
        trillion cubic feet (TCF) in the past 3 years owing to drilling 
        and expansion of shale gas. Proven reserves of dry natural gas, 
        including Prudhoe Bay, are about 300 TCF. Natural gas resource 
        estimates are 6-7 times the proven reserves. U.S. domestic 
        production of dry natural gas in 2008 was 20.6 TCF. Natural gas 
        is the largest source of domestically produced energy, slightly 
        greater than coal, substantially greater than oil, nuclear, and 
        all other sources. With the proper incentives, and combined 
        with a commitment to LNG, natural gas could support all of the 
        demand growth in power generation needed for several decades. 
        Such a shift in the fossil fuel mix would have a very positive 
        impact on reducing CO2 emissions growth.
  --The U.S. oil and gas industry is in decline. Many of the top public 
        companies that built the U.S. energy advantage no longer exist. 
        Such names as Mobil, Amoco, Texaco, Phillips, Unocal, Arco, 
        Kerr McGee and others are gone as the result of mergers and 
        acquisitions. This decline has not stopped. All combined public 
        companies control less than 10 percent of the world's oil and 
        natural gas reserves; the remainder is controlled by national 
        oil companies (NOCs), many of them OPEC nations. These NOCs are 
        now leasing up resources globally and will become the 
        international oil companies of the future.
  --Domestic oil and natural gas resources are increasingly developed 
        by independent producers, ranging from individuals to large 
        companies. They do not have the capacity or resources to 
        conduct independent research. They have, however, been willing 
        and able to quickly adopt and commercialize new technologies 
        when appropriate technology transfer occurs.
  --Federal R&D has historically provided support for the Nation's 
        universities and colleges, which have proven to be a rich 
        source of technological innovation. But as Federal support for 
        oil and natural gas technologies has waned, so has the ability 
        to conduct this type of research and train the next generation 
        of U.S. scientists and engineers. This trend is particularly 
        worrisome, because developing nations are investing 
        significantly in fossil energy research and development and 
        U.S. universities are now heavily enrolled by non U.S. 
        students.
    Given the important role that oil and particularly natural gas 
currently play in our energy portfolio, we must rebuild and expand the 
Nation's Federal R&D and training capacity for oil and natural gas 
through a partnership of government, academia, and industry. These and 
other trends demonstrate the need for a robust Federal oil and natural 
gas program, one that is funded on the scale of coal, nuclear and 
alternatives.
    We request the subcommittee on Energy and Water Development and 
Related Agencies appropriate $500 million for oil and natural gas 
technology programs to be administered by the Department of Energy's 
Office of Fossil Energy to support research projects that target 
increased production of domestic oil and natural gas resources.

                              COAL PROGRAM

    The Nation's coal resource is vitally important to U.S. energy 
security. AAPG supports significant research and development funding 
for coal, including clean coal technologies such as carbon capture and 
sequestration. We support the funding provided in the American Recovery 
and Reinvestment Act of 2009 for coal research, and encourage Congress 
to sustain this commitment in its fiscal year 2010 appropriations by 
funding at fiscal year 2009 levels or higher.
    Again, these investments must be balanced. In evaluating the DOE 
coal program, I urge you to review the findings of the National 
Academy's report entitled Coal: Research and Development to Support 
National Energy Policy, released in June 2007. The study finds that 
while there are significant uncertainties in U.S. coal reserve and 
resource estimates, there is sufficient coal at current consumption to 
last for more than 100 years.
    However, there is a real need for more ``upstream'' coal research 
to increase our understanding of the Nation's resource base. They 
observe that currently, over 90 percent of Federal R&D spending for 
coal is on the ``downstream'' side, focused on utilization, carbon 
capture and sequestration, and transport and transmission. Only 10 
percent goes to resource and reserve assessment, mining and processing, 
environment/reclamation, and safety and health.
    AAPG supports the $3.4 billion for coal R&D provided in the 
American Reinvestment and Recovery Act of 2009, and supports President 
Obama's fiscal year 2010 request of $404 million.

                 GEOTHERMAL ENERGY TECHNOLOGIES PROGRAM

    Geothermal energy is an important alternative energy resource that 
provides baseload power to the Nation's electrical grid. Significant 
expansion of geothermal power production may be possible through the 
development of enhanced or engineered geothermal systems, but 
developing and proving these technologies will require R&D investment.
    AAPG supports the $400 million for geothermal energy R&D and 
deployment in the American Reinvestment and Recovery Act of 2009. AAPG 
supports President Obama's fiscal year 2010 request for $50 million for 
this program, and encourages Congress to appropriate at this level.

                                SUMMARY

    Thank you for the opportunity to present this testimony to the 
subcommittee. Building a bridge to our energy future requires 
significant investment in new and alternative energy and fuel sources, 
but it also requires significant R&D investment in fossil fuels, the 
foundation of our global energy system, to ensure an orderly 
transition.
                                 ______
                                 
      Prepared Statement of the National Mining Association (NMA)

                          NMA RECOMMENDATIONS

Department of Energy--Office of Fossil Energy
    Background.--NMA is disappointed that the U.S. Department of Energy 
(DOE) fiscal year 2010 request severely reduced the overall fossil 
energy budget, with steep declines in funding for coal programs. While 
we recognize that the economic stimulus package enacted earlier this 
year included demonstration project and Clean Coal Power Initiative 
funding, we do not believe that such funding justifies the 20 percent 
for all fossil energy programs including in the fiscal year 2010 budget 
request. A cut of this magnitude will compromise advances in clean coal 
and carbon capture and sequestration efforts.
            Office of Fossil Energy
    NMA fully supports and urges maximum funding for carbon capture and 
storage (CCS) projects that avoid, reduce or store air pollutants and 
greenhouse gases while contributing long-term economic growth and 
international competitiveness. Substantial Federal funding for 
continued research, development and demonstration of CCS technologies 
will be required before CCS can be applied to large-scale commercial 
power plants. The construction and operation of near-zero emission and 
low carbon projects, such as the proposed FutureGen project in Mattoon, 
Ill., are indispensable to demonstrate that the technology necessary to 
meet domestic energy demands of the 21st century are available on a 
commercial scale. NMA strongly supports the recent agreement between 
the DOE and the FutureGen Alliance to proceed with a reconfigured 
carbon capture and storage energy facility at Mattoon, Ill. We support 
the use of $1.073 billion from the American Recovery and Reinvestment 
Act for use in this endeavor and look forward to working with the 
Alliance and DOE to further advance CCS technologies.
    Funding for basic research and development of new, innovative clean 
coal technologies is necessary to continue the progress made over the 
last 35 years. Regulated emissions from coal-based electricity 
generation have decreased by nearly 40 percent since the 1970s while 
the use of coal has tripled. Well funded basic coal research by DOE and 
clean coal technology demonstrations undertaken by DOE-private sector 
partnerships will continue this significant progress in energy 
production and environmental improvement. Technological advancements 
achieved in the base coal research and demonstration programs such as 
gasification, advanced turbines and carbon sequestration provide the 
component technologies that will ultimately be integrated into the 
FutureGen project as recently reconfigured. NMA supports funding 
several of these programs at levels higher than the President's 
request, specifically $80 million for IGCC/gasification (DOE's 
requested amount: $55 million), $45 million for advanced combustion 
(DOE's request does not include direct funding) and $45 million for 
advanced turbines (DOE's request: $31 million). We are, however, 
pleased that DOE provides nearly $180 million for the Carbon 
Sequestration Research & Development program and Carbon Sequestration 
Injection Tests combined. We hope that DOE will work with industry to 
identify specific programmatic activities and funding for these 
programs. The increase in funding for these and other programs will 
ensure the FutureGen project meets the intended goals outlined in DOE's 
2004 report to Congress, ``FutureGen, Integrated Sequestration and 
Hydrogen Research Initiative--Energy Independence through Carbon 
Sequestration and Hydrogen from Coal.''
    In addition, NMA recommends $3 million of funding for the Center 
for Advanced Separation Technologies (CAST), which is a consortium of 
seven universities lead by Virginia Tech. CAST has developed many 
advanced technologies that are used in industry to produce cleaner 
fuels in an environmentally acceptable manner, with some having cross-
cutting applications in the minerals industry. Further development of 
advanced separation technologies will help encourage developing 
countries, such as China and India, to deploy affordable clean coal 
technologies and reduce CO2 emissions. Research in Advanced 
Separations is mandated by the 2005 Energy Policy Act, section 962.
U.S. Army Corps of Engineers--Regulatory and Civil Works Programs
    Background.--The U.S. Army Corps of Engineers' (Corps) Regulatory 
Branch plays a key role in the U.S. economy through the Corps annual 
authorizations of approximately $200 billion of economic activity 
through its regulatory program. NMA recommends that a portion of the 
Corps' regulatory program funding be used to develop a more efficient 
process for expediting permit decisions associated with surface coal 
mining operations. In addition, NMA supports the inclusion of language 
directing the Corps to dedicate sufficient personnel and financial 
resources needed to support an efficient permit review process.
            Regulatory Program
    NMA supports increased funding for administering the Corps' Clean 
Water Act (CWA) section 404 permit program and for devising an 
efficient permitting program for authorizing surface coal mining 
permits.
            Civil Works Programs
    NMA opposes the Corps' proposed concept of a new inland waterways 
``lockage fee/tax,'' which would replace the current diesel fuel tax, 
to fund improvements to the Nation's inland waterways system. A lockage 
tax would more than double the taxes paid by the towing industry. The 
coal industry ships approximately 185 million short tons of coal 
annually on the inland waterways systems, therefore the cost of a new 
tax will ultimately be borne by the consumers of coal-fueled 
electricity. NMA opposes such a tax increase and urges Congress to 
reject this proposal and maintain the current diesel fuel tax.
                                 ______
                                 
       Prepared Statement of the American Wind Energy Association

                              INTRODUCTION

    America's wind industry enjoyed a record year of growth last year, 
deploying over 8,500 megawatts (MW) nationwide, which amounted to more 
than 40 percent of the country's new electricity generating capacity. 
Although wind is commercially deployable today, increased research, 
development, and deployment (RD&D) funding could significantly reduce 
its overall cost, improve reliability, and help keep America's domestic 
wind industry competitive with other electric generation sources and 
the wind industries in other countries.
    To meet these goals, the American Wind Energy Association (AWEA) 
requests that the subcommittee provide $105 million for the Department 
of Energy's (DOE) Wind Energy Program for fiscal year 2010, an increase 
of $30 million over the President's budget request. AWEA also requests 
that the subcommittee provide the DOE Office of Electricity Delivery 
and Energy Reliability (OE) with the $208 million included in the 
President's budget request. The President's budget request for OE 
includes approximately $73 million for transmission development and 
grid integration that could directly benefit wind deployment, including 
$20 million specifically for ``transmission reliability and renewable 
integration.''

              IMPORTANCE AND BENEFITS OF WIND ENERGY RD&D

    The DOE Wind Program has provided essential help to the wind 
industry over the years by supporting technology development and 
assisting in market acceptance of wind. The job is not done, however. 
Wind power is still constrained by difficulties in market acceptance 
and needed improvements in cost, performance, and reliability.
    As wind energy meets more of our energy needs, it is crucial to 
increase Federal funding to lower capital costs and improve turbine 
reliability. DOE's 20 percent Wind Energy by 2030 report assumes that 
capital costs decrease by 10 percent and that turbine efficiency 
increases by 15 percent to reach the goal of providing 20 percent of 
our Nation's electricity from wind by 2030. The need for continued 
Federal investment in wind RD&D is made clear in the report when DOE 
states, ``In a functional sense, wind turbines now stand roughly where 
the U.S. automotive fleet stood in 1940.\1\''
---------------------------------------------------------------------------
    \1\ U.S. Department of Energy, ``20% Wind Energy by 2030'' (July 
2008), http://www.20percentwind.org/20p.aspx?page=Report.
---------------------------------------------------------------------------
    Meeting the 20 percent goal by 2030 would provide a host of 
benefits nationwide, including:
  --Supporting 500,000 jobs, generating over $1 trillion in economic 
        impact by 2030;
  --Reducing natural gas demand by approximately 7 billion cubic feet/
        day, nearly half of the current consumption in the electric 
        sector;
  --Decreasing natural gas prices by approximately 12 percent, saving 
        consumers approximately $128 billion through 2030;
  --Avoiding 825 million tons of carbon dioxide emissions in the 
        electric sector in 2030, equivalent to 25 percent of expected 
        electric sector emissions; and
  --Reducing cumulative water consumption in the electric sector by 17 
        percent in 2030 (one-third of which would come from the arid 
        West).

                 EXPLANATION OF APPROPRIATIONS REQUEST

    Last year, as part of an AWEA Research and Development (R&D) 
Committee effort, a team of over 80 AWEA members and advisors from 
industry, government, and academic institutions met to determine how 
much funding would be needed to meet the goal of providing 20 percent 
of our Nation's electricity from wind energy by 2030. Participants 
determined that $217 million in annual Federal funding, combined with a 
$224 million annual industry/State cost share, would be necessary to 
support the research and development and related programs needed to 
meet that goal. The group determined that $201 million should be 
directed to DOE, with an additional $15.5 million for the Department of 
Labor (DOL) for workforce development.
    AWEA greatly appreciates DOE's designation of funding from the 
American Recovery and Reinvestment Act (ARRA) for wind energy RD&D and 
transmission and systems integration. AWEA is also grateful for the 
increases for the DOE Wind Program and OE transmission activities in 
the President's fiscal year 2010 budget. The combined funding will 
finance a number of key wind industry priorities to help overcome the 
challenges to meet the 20 percent by 2030 vision. However, neither the 
ARRA nor the President's budget appears to fully address a number of 
key wind energy challenges.
    Technology R&D funding through the ARRA and the President's budget 
provides a much needed boost to bring down the cost of wind energy and 
improve wind turbine efficiency. However, more funding is needed to 
address issues related to wind turbine technology, siting and public 
education, wind resource modeling and wind power plant efficiency 
assessment. In April, Secretary Chu announced $93 million from the ARRA 
for wind energy RD&D, including $45 million to build a wind turbine 
drivetrain testing facility and $10 million for the National Renewable 
Energy Laboratory's (NREL) National Wind Technology Center (NWTC). In 
May, he announced $25 million to construct and fund first-year 
operating expenses for the Massachusetts Wind Technology Testing Center 
to test large wind turbine blades.
    In total, the ARRA funding and the President's budget still fall 
short of the $161 million in annual DOE, non-transmission funding 
identified through the AWEA R&D Committee effort to meet the goal of 
providing 20 percent of our Nation's electricity from wind energy by 
2030. $45 million for the drivetrain testing facility will be used for 
construction expenses, as will most of the $25 million provided for the 
large blade test facility. The $10 million for the NWTC will fund 
infrastructure improvements to the facility. As a result, a budget gap 
of $30 million remains between the wind industry's RD&D needs and 
fiscal year 2010 Federal funding for wind RD&D.
    The President's fiscal year 2010 budget for the DOE Wind Program 
includes just over $11 million for ``technology acceptance.'' Within 
this category, one of the wind industry's top priorities is improving 
radar and electro-magnetic fields assessment and mitigation. The 
Department of Defense, Federal Aviation Administration, and other 
Government agencies are concerned about the impact wind projects have 
on radar systems. Funding mitigation methods is crucial for opening new 
areas for wind energy development.
    The wind industry has also identified the need to fund programs to 
educate local policymakers and the general public. Such programs are 
critically important to provide communities with reliable, objective 
information about wind projects.
    The working group mentioned above determined that $19 million is 
needed to fund radar assessment and mitigation and the education of the 
public and local decisionmakers on wind energy issues. Out of the $105 
million request, AWEA would appreciate an increase of $8 million to 
ensure that the DOE Wind Program's technology acceptance efforts meet 
industry needs and to facilitate the installation of more wind energy 
projects across the country.
    Finally, as mentioned earlier, overcoming the transmission 
challenges associated with grid integration and transmission expansion 
is another top priority for the wind industry. Regardless of which 
office receives funding for grid integration and transmission 
development, it is crucial that OE and DOE's Office of Energy 
Efficiency and Renewable Energy (EERE) work together to assist 
utilities in their efforts to produce grid integration solutions 
related to wind variability while incorporating expertise in place at 
DOE national laboratories, such as NREL. EERE, OE, and NREL should also 
work closely with organizations like the Utility Wind Integration Group 
(UWIG) to resolve grid integration challenges associated with wind 
energy development.

                    GENERAL WIND INDUSTRY PRIORITIES

    The wind industry generally supports Federal funding for the 
following areas:
    Wind Turbine Technology and Reliability.--This area should focus on 
the development of wind turbine components to reduce capital costs, 
improve performance, and enhance reliability to achieve the 20 percent 
vision by 2030.
    AWEA also recognizes the need to reduce the cost of offshore wind 
energy technology to provide the estimated 54 gigawatts (GW) of the 300 
GW needed to meet the 20 percent goal by 2030. For this reason, AWEA 
requests that any funding for the DOE Wind Program above the $105 
million request be provided for the development of offshore-specific 
technology. Although the immediate needs for wind technology and 
deployment are focused on land-based development, AWEA recognizes that 
offshore wind development offers a substantial opportunity for 
additional wind development.
    Systems Integration.--This program area focuses on the power system 
operations issues of integrating variable, non-dispatchable power 
sources into the power system. Areas of special focus include 
developing and promoting advanced forecasting methods, developing and 
analyzing additional sources of system flexibility, expanding and 
implementing power system operation tools, and supporting 
interconnection-wide integration studies and plans.
    Transmission Expansion.--Transmission expansion has been identified 
as one of the key areas of focus for meeting the 20 percent by 2030 
wind energy goal. This area of funding should focus on issues related 
to expanding the transmission grid to increase access to wind resource 
areas.
    Education and Workforce Development.--NREL has identified the lack 
of skilled workers as one of the biggest non-technical barriers to the 
growth of renewable energy industries. In addition to educating 
policymakers and stakeholders about wind power development, areas of 
special focus include making sure that DOL and DOE work together to 
increase the supply of professionals and technical specialists with 
wind-energy specific knowledge.
    Resource Modeling and Wind Power Plant Efficiency Assessment.--A 
better understanding of wind resources and of turbine wake effects 
would provide an immediate benefit for projects to be sited and 
arranged to optimize energy yield and improve performance. Areas of 
special focus include funding for test centers to better understand 
wind flow models, research on the effect of wind turbines under unusual 
atmospheric conditions, and funding for wake loss models.
    Siting (Resources, Land Use, Environmental Interface).--Greater 
funding for wind project siting issues would help the wind industry 
avoid unnecessary wind deployment delays, thus helping the industry to 
stay on track to meet the 20 percent vision by 2030. In general, 
increased funding in this area should be targeted toward better 
understanding the impact of wind turbines on wildlife and radar 
installations and mitigating these impacts.
    Small Wind (Turbines 100 Kilowatts and Smaller).--Greater Federal 
funding for these systems would help the small wind industry serve end 
users directly with domestic, on-site generation.

                               CONCLUSION

    The President and Congress have called for a bolder commitment to 
the development of domestic renewable energy resources, particularly 
wind energy, to meet our Nation's growing energy needs. Continued 
investments in wind energy RD&D are delivering value for taxpayers by 
fostering the development of a domestic energy source that strengthens 
our national security, provides economic development, spurs new high-
tech jobs, and helps protect the environment.
    While the wind industry continues adding new generation capacity, a 
number of challenges still exist. Continued support for DOE's wind 
program is vital to helping wind become a more prominent energy source 
that leads to a host of economic and environmental benefits. AWEA urges 
the subcommittee to include $105 million for the DOE Wind Energy 
Program in fiscal year 2010. Any additional funding above this amount 
should be directed toward the advancement of offshore wind system 
technology.
    AWEA would also appreciate the subcommittee providing OE with the 
$208 million included in the President's budget request. As mentioned 
earlier, the President's budget request for OE includes approximately 
$73 million that, at least in part, would benefit transmission 
development and grid integration related to wind deployment, including 
$20 million specifically for ``transmission reliability and renewable 
integration.''
    AWEA appreciates this opportunity to provide testimony on DOE's 
fiscal year 2010 Wind Energy Program budget before the Senate 
Appropriations Subcommittee on Energy and Water Development. We thank 
the subcommittee for its time and attention to our request.
                                 ______
                                 
     Prepared Statement of the American Society of Plant Biologists

    On behalf of the American Society of Plant Biologists (ASPB) we 
submit this statement for the official record to support increased 
funding for the Department of Energy's Office of Science for fiscal 
year 2010 that would keep the Office on a doubling path. The testimony 
highlights the importance of biology, particularly plant biology, as 
the Nation seeks to address vital issues including climate change and 
energy security. We would also like to thank the subcommittee for its 
consideration of this testimony and for its strong support for the 
basic research mission of the Department of Energy's Office of Science.
    The American Society of Plant Biologists is an organization of more 
than 5,000 professional plant biologists, educators, graduate students, 
and postdoctoral scientists. A strong voice for the global plant 
science community, our mission--which is achieved through engagement in 
the research, education, and public policy realms--is to promote the 
growth and development of plant biology and plant biologists and to 
foster and communicate research in plant biology. The Society publishes 
the highly cited and respected journals Plant Physiology and The Plant 
Cell, and it has produced and supported a range of materials intended 
to demonstrate fundamental biological principles that can be easily and 
inexpensively taught in school and university classrooms by using 
plants.

  FOOD, FUEL, CLIMATE CHANGE, AND HEALTH--PLANT BIOLOGY RESEARCH AND 
                            AMERICA'S FUTURE

    Plants are vital to our very existence. They harvest sunlight, 
converting it to chemical energy for food and feed; they take up carbon 
dioxide and produce oxygen; and they are almost always the primary 
producers in the Earth's ecosystems. Indeed, basic plant biology 
research is making many fundamental contributions in the areas of fuel 
security and environmental stewardship; the continued and sustainable 
development of better foods, fabrics, and building materials; and in 
the understanding of basic biological principles that underpin 
improvements in the health and nutrition of all Americans. To go 
further, plant biology research can help the Nation both predict and 
prepare for the impacts of climate change on American agriculture, and 
it can make major contributions to our Nation's efforts to combat 
global warming.
    In particular, plant biology is at the center of numerous 
scientific breakthroughs in the increasingly interdisciplinary world of 
alternative energy research. For example, interfaces among plant 
biology, engineering, chemistry, and physics represent critical 
frontiers in both basic biofuels research and bioenergy production. 
Similarly, with the increase in plant genome sequencing and functional 
genomics, the interface of plant biology and computer science is 
essential to our understanding of complex biological systems ranging 
from single cells to entire ecosystems.
    Despite the fact that plant biology research--the kind of research 
funded by the DOE--underpins so many vital practical considerations for 
our country, the amount invested in understanding the basic function 
and mechanisms of plants is relatively small when compared with the 
impact it has on multibillion dollar sectors of the economy like energy 
and agriculture.

                            RECOMMENDATIONS

    ASPB, as a spokesperson for the plant science community, is in an 
excellent position to articulate the Nation's plant science priorities 
as they relate to bioenergy and, specifically, with regard to 
recommendations for bioenergy research funding through the Department 
of Energy's Office of Science. Our recommendations, in no particular 
order, are as follows:
  --We commend the DOE Office of Science, through their Divisions of 
        Basic Energy Sciences (BES) and Biological and Environmental 
        Research (BER) for funding the Bioenergy Research Centers (BER) 
        and the recently awarded Energy Frontier Research Centers 
        (BES). Although these efforts are well designed and a 
        significant step forward, these large centers will not have a 
        monopoly on good ideas. Therefore, ASPB strongly encourages the 
        appropriation of additional funds for the DOE Office of Science 
        that would be specifically targeted to the funding of 
        individual or small group grants for bioenergy research, like 
        the Single-Investigator and Small-Group Research (SISGR) 
        projects funded through BES in fiscal year 2009.
  --The DOE Office of Science is the primary funding agency for 
        physical science research. Past experience teaches us that many 
        major scientific and technical breakthroughs occur at the 
        interface between traditional scientific disciplines. 
        Therefore, ASPB recommends appropriations that would 
        specifically target the interface between plant biology and the 
        physical sciences to encourage multidisciplinary and cross-
        disciplinary research that would address significant problems 
        in bioenergy research.
  --Photosynthetic research is one clear example of an interface 
        between the physical sciences and biology. The DOE BER has been 
        the major source of funds for basic studies of photosynthesis, 
        which is the primary source of chemical energy on the planet. 
        After all, fossil fuels are just photosynthetic energy that was 
        trapped eons ago and converted through natural processes into 
        the forms in which we use it today. However, the current 
        funding available for photosynthetic research is not 
        commensurate with the central role that photosynthesis plays in 
        energy capture and carbon sequestration. Hence, ASPB calls for 
        an increase in appropriations to BER to expand its research 
        portfolio in the area of photosynthesis and carbon capture.
  --Climate change is real and will have significant impacts on 
        agriculture and our way of life for the foreseeable future. 
        There are significant questions that must be answered as to how 
        climate change will impact food production and the environment. 
        There are also clear opportunities to use biological systems to 
        ameliorate climate change, such as through carbon sequestration 
        or modification of plants to resist environmental stress. 
        Therefore, ASPB calls for additional funding focused on studies 
        of the effect of climate change on agricultural cropping 
        systems, basic studies of effects on plant growth and 
        development, and targeted research focused on modification of 
        plants to resist climate change and for use in carbon 
        sequestration.
  --Current estimates predict a significant shortfall in the needed 
        scientific and engineering workforce in the energy area. The 
        DOE Office of Science has traditionally not been a major 
        funding agency for education and training, other than that 
        which occurs through the funding of individual investigator and 
        center grants. Given the expected need for additional 
        scientists and engineers who are well-grounded in 
        interdisciplinary research and development activities, ASPB 
        calls for funding of specific programs (e.g., training grants) 
        that are targeted to provide this needed workforce over the 
        next 10 years and to adequately prepare them for careers in the 
        interdisciplinary energy research of the future.
  --The revolution in biological technology that has given rise to the 
        various--omics subdisciplines has also generated enormous 
        datasets that reveal the tremendous complexity of biological 
        systems. Computational biology is a relatively new discipline 
        that arose from the interface of computer science and biology. 
        These new technologies and approaches provide the only means by 
        which these large biological datasets can be integrated and 
        mined for new, relevant biological knowledge. Therefore, as 
        discussed in item two above, ASPB calls for additional funding 
        that would target this interface between biology and computer 
        science. Specifically, we call for additional funding to 
        develop computational platforms to develop a systems-level view 
        of biology through the integration of data obtained from a 
        variety of functional genomics approaches. This is clearly a 
        ``grand challenge'' that is currently limiting the utility of 
        this information. Additionally, we call for the funding of 
        robust education and professional development programs, 
        including training grants, that target the interface between 
        computer and biological science.
  --Considerable research interest is now being paid to the use of 
        plant biomass for energy production. Progress in this area has 
        been strongly affected by the ``fuel vs. food'' debate, which 
        arose from the current emphasis on the use of corn for ethanol 
        production. A response to this debate has been to switch the 
        focus to plants that can be grown exclusively for biomass 
        (e.g., switchgrass, miscanthus, etc). However, if these crops 
        are to be used to their full potential, considerable effort 
        must be expended to improve our understanding of their basic 
        biology and development, as well as their agronomic 
        performance. Unlike our current, major crops (e.g., soybean, 
        corn), these novel crops have not benefitted from the many 
        years of improvements in crop management and breeding--
        improvements that, among other things, have vastly increased 
        yield and agronomic efficiency. Although similar efforts to 
        improve targeted bioenergy crops are just beginning, we have 
        established very aggressive goals for the use of these crops to 
        meet the Nation's fuel needs. Therefore, ASPB calls for 
        additional funding that would be targeted to efforts to 
        increase the utility and agronomic performance of bioenergy 
        crops.
    Thank you for your consideration of our testimony on behalf of the 
American Society of Plant Biologists. Please do not hesitate to contact 
the American Society of Plant Biologists if we can be of any assistance 
in the future. For more information about the American Society of Plant 
Biologists, please see www.aspb.org.
                                 ______
                                 
 Prepared Statement of the American Society of Agronomy, Crop Science 
      Society of America, and the Soil Science Society of America

    Dear Chairman Dorgan, Ranking Member Bennett and members of the 
subcommittee, the American Society of Agronomy (ASA), Crop Science 
Society of America (CSSA), and Soil Science Society of America (SSSA) 
are pleased to submit the following funding recommendations for the 
Department of Energy for fiscal year 2010. For the Office of Science, 
ASA, CSSA, and SSSA recommend a funding level of $5.0 billion, a 4.8 
percent increase over fiscal year 2009 ($4.722 billion). For the Office 
of Energy Efficiency and Renewable Energy, we recommend a funding level 
of $2.061 billion, a 7 percent increase over fiscal year 2009. 
Specifics for each of these and other budget areas follow below.
    With more than 25,000 members and practicing professionals, ASA, 
CSSA, and SSSA are the largest life science professional societies in 
the United States dedicated to the agronomic, crop and soil sciences. 
ASA, CSSA, and SSSA play a major role in promoting progress in these 
sciences through the publication of quality journals and books, 
convening meetings and workshops, developing educational, training, and 
public information programs, providing scientific advice to inform 
public policy, and promoting ethical conduct among practitioners of 
agronomy and crop and soil sciences.

                 DEPARTMENT OF ENERGY OFFICE OF SCIENCE

    The American Society of Agronomy, Crop Science Society of America, 
and Soil Science Society of America (ASA, CSSA, and SSSA) thank the 
Senate Energy and Water Appropriations Subcommittee (subcommittee) for 
providing $1.6 billion from Public Law 111-5, the ``American Recovery 
and Reinvestment Act of 2009 (act)'' for research funding through DOE's 
Office of Science, which oversees the Nation's research programs in 
climate science, advanced computing, and biofuels areas crucial to our 
energy future. The act also provides $2.5 billion for Research, 
Development, and Demonstration at universities, companies, and national 
laboratories for which we are very grateful.
    ASA, CSSA, and SSSA understand the challenges the Senate Energy and 
Water Appropriations Subcommittee faces with the tight budget for 
fiscal year 2010. We also recognize that the Energy and Water 
Appropriations bill has many valuable and necessary components, and we 
applaud the subcommittee for funding the DOE Office of Science in the 
fiscal year 2009 Omnibus Appropriations bill at $4.772 billion. For 
fiscal year 2010, ASA, CSSA, and SSSA recommend a funding level of $5.0 
billion, a 4.8 percent increase over fiscal year 2009. Under the Energy 
Policy Act of 2005 (Public Law 109-58), the Office of Science was 
authorized to receive $5.2 billion in fiscal year 2009.
    The Office of Science supports graduate students and postdoctoral 
researchers early in their careers. Nearly one-third of its research 
funding goes to support research at more than 300 colleges and 
universities nationwide. Moreover, approximately half the users at 
Office of Science user facilities are from colleges and universities, 
providing further support to their researchers. The Office of Science 
also reaches out to America's youth in grades K-12 and their teachers 
to help improve students' knowledge of science and mathematics and 
their understanding of global energy and environmental challenges. This 
recommended funding level of $5.0 billion is critical to ensuring our 
future energy self-sufficiency and as a means to address major 
environmental challenges including global climate change. Finally, a 
funding level of $5.0 billion will allow the Office of Science to: 
maintain and strengthen DOE's core research programs at both the DOE 
national laboratories and at universities; provide support for 1,000 
PhDs, postdoctoral associates, and graduate students in fiscal year 
2010; ensure maximum utilization of DOE research facilities; allow the 
Office of Science to develop and construct the next generation 
facilities necessary to maintain U.S. preeminence in scientific 
research; and enable DOE to continue to pursue the tremendous 
scientific opportunities outlined in the Office of Science Strategic 
Plan and in its 20 Year Scientific Facilities Plan.

                         BASIC ENERGY SCIENCES

    Within the Office of Science, the Basic Energy Sciences (BES) 
Program is a multipurpose, scientific research effort that fosters and 
supports fundamental research to expand the scientific foundations for 
new and improved energy technologies and for understanding and 
mitigating the environmental impacts of energy use. ASA, CSSA, and SSSA 
support a fiscal year 2010 funding level of $1.682 billion, a 7 percent 
increase over fiscal year 2009, for BES.
    The portfolio of programs at BES supports research in the natural 
sciences by focusing basic (discovery) research on, among other 
disciplines, biosciences, chemistry and geosciences. Practically every 
element of energy resources, production, conversion and waste 
mitigation is addressed in basic research supported by BES programs. 
Research in chemistry has lead to the development of new solar 
photoconversion processes and new tools for environmental remediation 
and waste management. Research in geosciences leads to advanced 
monitoring and measurement techniques for reservoir definition. 
Research in the molecular and biochemical nature of photosynthesis aids 
the development of solar photo-energy conversion.
    Within the Basic Energy Sciences Program, the Chemical Sciences, 
Geosciences, and Energy Biosciences subprogram supports fundamental 
research in geochemistry, geophysics and biosciences. ASA, CSSA, and 
SSSA recommend $317,910,910 a 7 percent increase over the fiscal year 
2009 funding level. The Geosciences Research Program supports research 
focused at developing an understanding of fundamental Earth processes 
that can be used as a foundation for efficient, effective, and 
environmentally sound use of energy resources, and provide an improved 
scientific basis for advanced energy and environmental technologies. 
The Biosciences Research Program supports basic research in molecular 
level studies on solar energy capture through natural photosynthesis; 
the mechanisms and regulation of carbon fixation and carbon energy 
storage; the synthesis, degradation, and molecular interconversions of 
complex hydrocarbons and carbohydrates; and the study of novel 
biosystems and their potential for materials synthesis, chemical 
catalysis, and materials synthesized at the nanoscale.

                 BIOLOGICAL AND ENVIRONMENTAL RESEARCH

    Within the Office of Science, the Biological and Environmental 
Research (BER) Program, is a key component to developing and delivering 
the knowledge needed to support the President's plan to make America 
energy independent. ASA, CSSA, and SSSA support a 7 percent increase 
for BER which would bring the funding level to $643,647,800 for fiscal 
year 2010. ASA, CSSA, and SSSA support a variety of programs within BER 
including the Life Sciences subprogram which supports Carbon 
Sequestration Research (we recommend $8 million for fiscal year 2010), 
and the Genomes to Life (GTL) program. Within Genomes to Life are 
programs supportive of bioenergy development including GTL Foundation 
Research, GTL Sequencing, GTL Bioethanol Research, and GTL Bioenergy 
Research Centers, all playing an important role in achieving energy 
independence for America. Also within BER is the Environmental 
Remediation subprogram and its Environmental Remediation Sciences 
Research program, both critical programs to advancing tools needed to 
clean up contaminated sites. ASA, CSSA, and SSSA recommend a funding 
level of $190,381,000, a 7 percent increase over fiscal year 2010 for 
Climate Change Research subprogram. This subprogram supports important 
areas of climate change research including: Climate Forcing which 
supports the Terrestrial Carbon Processes program and the Ameriflux 
network of research sites (which should receive $17 million in 
funding), as understanding the role that terrestrial ecosystems play in 
capturing and storing carbon is essential to developing strategies to 
mitigate global climate change. An additional program of high 
importance within the Climate Change Research subprogram is the Climate 
Change Response and its associated programs--Ecosystem Function and 
Response, and Education. Finally, also under the Climate Change 
Research subprogram is the Climate Change Mitigation program, part of 
BER's support to the Climate Change Technology Program, which will 
continue to focus only on terrestrial carbon sequestration.
 department of energy office of energy efficiency and renewable energy
    The Office of Energy Efficiency and Renewable Energy (EERE) manages 
America's investment in the research and development (RD&D) of DOE's 
diverse energy efficiency and renewable energy applied science 
portfolio. For the Office of Energy Efficiency and Renewable Energy, we 
recommend a funding level of $2.061 billion, a 7 percent increase over 
fiscal year 2009. The fiscal year 2010 EERE budget should continue to 
maintain focus on key components of the AEI and Twenty in Ten including 
the Biofuels Initiative to develop affordable, bio-based transportation 
fuels from a wider variety of feedstocks and agricultural waste 
products.
    Note: ASA, CSSA, and SSSA strongly oppose the use by the Department 
of the terms ``agricultural wastes'' or ``crop wastes'' when referring 
to crop residue. Crop residues, e.g., corn stover, etc. play a very 
important role in nutrient cycling, erosion control and organic matter 
development. Recent studies have shown that excessive removal of crop 
residues from agricultural lands can lead to a decline in soil quality. 
By no means should they ever be referred to as ``wastes''.

                    BIOMASS AND BIOREFINERY SYSTEMS

    Within EERE, the Biomass and Biorefinery Systems R&D program plays 
an important role providing support for Regional Biomass Feedstock 
Development Partnerships and Infrastructure Core R&D programs, both 
within Feedstock Infrastructure. For the Biomass and Biorefinery 
Systems R&D program, we recommend a 7 percent increase for fiscal year 
2010 which would bring funding to $190,381,000. The mission of the 
Biomass Program is to develop and transform our domestic, renewable, 
and abundant biomass resources into cost-competitive, high performance 
biofuels, bioproducts and biopower through targeted RD&D leveraged by 
public and private partnerships. ASA, CSSA, and SSSA support $18 
million in funding for the Feedstock Infrastructure program.

                        CLIMATE CHANGE RESEARCH

    ASA, CSSA, and SSSA urge the subcommittee to continue to provide 
strong support for Climate Change Research to the following programs as 
follows: Climate Change Science Program (CCSP), $150 million; Climate 
Change Research Initiative (CCRI), $25,672,000; and Climate Change 
Technology Program (CCTP), $850,301,000. These three programs together 
will increase our understanding of the impacts of global climate change 
and also develop tools and technologies to mitigate these impacts.

                   BASIC AND APPLIED R&D COORDINATION

    The Office of Science continues to coordinate basic research 
efforts in many areas with the Department's applied technology offices. 
Within this area is Carbon Dioxide Capture and Storage R&D for which we 
recommend $20,055,000.

                         NATIONAL LABORATORIES

    The Office of Science manages 10 world-class laboratories, which 
often are called the ``crown jewels'' of our national research 
infrastructure. The national laboratory system, created over a half-
century ago, is the most comprehensive research system of its kind in 
the world. Five are multi-program facilities including the Oak Ridge 
National Laboratory.

              NATIONAL ENERGY TECHNOLOGY LABORATORY (NETL)

    ASA, CSSA, and SSSA urge the subcommittee to direct the Department 
to increase funding for its terrestrial carbon sequestration program, 
specifically The Regional Carbon Sequestration Partnerships, whose 
collaborations are essential to maintain.

                  OAK RIDGE NATIONAL LABORATORY (ORNL)

    ORNL is one of the world's premier centers for R&D on energy 
production, distribution, and use and on the effects of energy 
technologies and decisions on society.
    Thank you for your thoughtful consideration of our requests.
                                 ______
                                 
Prepared Statement of the Center for Advanced Separation Technologies, 
          Virginia Polytechnic Institute and State University

    Chairman Dorgan, Ranking Member Bennett, and members of the 
subcommittee, I represent the Center for Advanced Separation 
Technologies (CAST), which is a consortium of five universities with 
strong programs in coal mining and processing. I appreciate the 
opportunity to submit this testimony requesting that your subcommittee 
add $3 million to the 2010 Fuels Program budget, Fossil Energy Research 
and Development, U.S. Department of Energy, for advanced separations 
research. Research in advanced separations technology development is 
authorized by the Energy Policy Act of 2005, title IX, subtitle F, sec. 
962. I am joined in this statement by my colleagues from four other 
member universities: Richard A. Bajura, West Virginia University; Rick 
Q. Honaker, University of Kentucky; Peter H. Knudsen, Montana Tech of 
the University of Montana; Jan D. Miller, University of Utah.
    funding request for center for advanced separation technologies
    Fossil energy accounts for 86 percent of the energy used in the 
United States and the world. Due to concerns for global warming, the 
U.S. Government is making major investments in developing renewable 
energy resources and carbon capture and sequestration (CCS) 
technologies. However, it will take a while for many of the new 
technologies to come on line. Therefore, CAST will continue to develop 
advanced technologies that can be used to produce fossil fuels with 
minimal environmental impacts and to capture the harmful effluents 
generated from the utilization of fossil fuels.
    Between 1990 and 2008, U.S. emissions of CO2 from fossil 
fuel combustion grew by 27 percent. But the emissions in China rose 150 
percent, from 2.3 to 5.9 billion tons. China's CO2 emissions 
are now estimated to be about 24 percent of the global total, 
surpassing the U.S. contribution of 21 percent (State of the World 
2009). It is projected that by 2030 developing countries will account 
for more than 75 percent of the increase in global CO2 
emissions. Thus, the United States must engage developing countries in 
its effort to curb CO2 emissions.
    A serious problem in China and India is that much of the coal is 
burned as mined without cleaning, causing low thermal efficiencies. In 
these two countries, the thermal efficiencies for power generation are 
29 percent in average as compared to 38 percent in the United States. 
By increasing the efficiency to 33 percent by way of improving coal 
quality, the CO2 emissions in China can be reduced by 20 
percent. According to a recent IEA report, India could reduce 
CO2 emissions by 55 percent using state-of-the-art 
technologies relating to coal quality, boiler/generator design, 
instrumentation and control, and high voltage distribution systems 
(Couch, 2002). Unfortunately, much of the coal burned in India is of 
low quality, assaying 35-42 percent ash, while the ash contents of the 
coals burned for power generation are mostly less than 8 percent. 
Helping China and India improve the quality of their coal burned for 
power generation would be the first step toward deploying clean coal 
technologies (CCT) and reducing CO2 emissions substantially.
    It is, therefore, the objective of CAST research to develop 
advanced technologies that can be used to remove various impurities 
from coal, so that it can be burned more cleanly and efficiently. These 
technologies can also be used to minimize the problems associated with 
waste disposal at mine sites and power plants, and help reduce 
CO2 emissions in developing countries. It is also the 
objective to study and develop methods of extracting other fossil 
energy resources, such as oil sands, oil shale, and methane hydrates in 
environmentally acceptable manner.

                       SUMMARY OF ACCOMPLISHMENT

    Cleaning coal becomes more difficult and costly as the size of coal 
particles becomes smaller. Therefore, many companies discard coal fines 
to impoundments along with the water that is used for their washing 
operations, or inject the coal-water slurries into abandoned, 
underground mines. The latter practice has been drawing criticism, as 
the water containing toxic elements (and sometimes the slurry itself) 
contaminates drinking water (Smith, V., AP News, March 21, 2009). The 
fine coal impoundments also pose environmental threats as they 
occasionally fail, releasing billions of gallons of slurry into the 
neighborhoods and rivers. Recognizing the seriousness of these 
problems, CAST has been developing a series of advanced fine coal 
cleaning technologies over the years. During the last few years, we 
have been focusing on developing methods of removing water (dewatering) 
from fine coal slurry, which is regarded one of the most 
technologically challenging problems for the coal industry. During 
2008-2009, CAST has completed testing the hyperbaric centrifugal 
dewatering technology in operating plants. The results of the 
successful test program have been highlighted in Techline, DOE's web 
newsletter, in February 2009. Industry leaders consider this new 
development as the most significant technological breakthrough in 20 
years.
    CAST is also well known for its expertise in separating fine coal 
from ash-forming minerals. One success story was the development of the 
MicrocelTM flotation technology, which is widely used around 
the world. During the last 2 years, FLSmidth Minerals, Salt Lake City, 
Utah, which is one of the world's largest mining equipment companies, 
has provided $900,000 of research funding to develop a mathematical 
model for the separation process. This industrial funding was provided 
as a matching fund against the $250,000 of CAST fund allocated for this 
project. The results of the project will be used to help the company 
improve the designs of the currently marketed flotation machines.
    Indian coal is notoriously difficult to clean, because ash-forming 
minerals are finely disseminated in the coal matrix. Using conventional 
methods, it is difficult to reduce the ash content to below 12-14 
percent by weight even for high-quality metallurgical coals. With the 
help of the U.S. Department of Energy, CAST is negotiating a $1.2 
million research contract with Coal India Limited (CIL), in which a 75-
tonnes per hour coal cleaning plant is designed, constructed by CIL, 
and demonstrated. The plant will be using the advanced technologies 
developed at CAST to reduce the ash content to below 8 percent.
    In addition, CAST is testing a pilot-scale dry coal cleaning 
technology in India. This project is funded by the Department of State 
(DOS) in the amount of $1.1 million as part of the Asia Pacific 
Partnership (APP) for Clean Development and Climate program. The pilot-
scale test unit has been shipped to India for on-site testing, which 
will begin within a month. The objective of this project and the one 
described in the forgoing paragraph is to help India clean coal before 
burning, which is considered the lowest-cost option to reduce 
CO2 emissions in the country.
    CAST research activities helped the fossil energy industries in 
Utah, including coal, oil sand and oil shale industries. For example, 
CAST funds have helped to sustain the development of new technology for 
the efficient utilization of western coal by Ambre Energy, North 
America, a Salt Lake City based company. Ambre Energy has licensed a 
University of Utah technology as part of their plans to construct a 
$300 million plant which will include, among others the production of 
advanced transportation fuels from western coal resources.
    In the areas of post-combustion clean-up, CAST has developed 
metallic filters that can remove mercury from the flue gas generated at 
coal-fired power plants. Based on the successful laboratory test 
results, the mercury filters were tested at the PPL's Colstrip power 
plant in Montana. The removal efficiency was greater than 90 percent, 
verifying laboratory experiments. The mercury absorbed on the metallic 
filters were stripped off by an in situ thermal treatment, so that the 
filter can be reused and the mercury be collected for commercial use.
    All of the fossil fuels, including coal, oil, natural gas, methane 
in hydrate, kerogen in oil shale, and bitumen in oil sands, are 
naturally hydrophobic. During 2008-2009, CAST has made significant 
advancements in the basic understanding of the nature of hydrophobicity 
and hydrophobic interactions. The results will be useful not only for 
developing these energy resources but also for separating different 
gases from each other. It is possible to convert one type of gas to 
hydrate (solid) leaving the others in gaseous form, thereby achieving 
separation.

                             PROPOSED WORK

    Although coal is regarded as ``dirty'' fuel, it will take some time 
before clean, renewable fuels can replace coal substantially. According 
to the 2008 International Energy Outlook (EIA, September 2008), coal 
consumption will increase faster than any other energy resource, 
particularly in China. Therefore, it is important to continue to 
develop methods of recovering and utilizing coal with minimal 
environmental impacts. To meet this objective, CAST will develop 
technologies that can be used to minimize the environmental problems 
both at mine sites (e.g., refuse pond and runoff water from valley-fill 
mining operations) and coal-burning power plants (e.g. ash pond, 
mercury emissions, and CO2 emissions).
    In addition to the hyperbaric centrifuge described above, CAST has 
been developing a novel technology that can remove water, ash, and 
other impurities simultaneously. Laboratory tests showed that this new 
technology can produce clean coal with lower moisture and lower ash 
contents at higher coal recoveries than can be achieved by using a 
combination of the Microcel and the centrifuge technologies. The new 
technology can, therefore, be implemented at lower capital cost and 
will be particularly useful for recovering coal from fine coal 
impoundments. During 2009-2010, the new process will be tested on a 
bench-scale continuous mode. Several companies have expresses strong 
interest in commercializing this new technology.
    An important part of developing coal cleaning technologies is 
technology transfer. Therefore, CAST will devote considerable resources 
for on-site testing, problem solving, and offering short-courses and 
seminars for plant operators. Keeping industry operators abreast of 
CAST research will expedite the technology transfer and help the U.S. 
companies maintain a clean environment near mine sites.
    Using the improved understanding of the basic sciences involved in 
gas hydrate formation, CAST will also develop methods of separating 
gases from each other. The methods will be based on solidifying one-
type of gas as hydrate while keeping the others in gaseous form. For 
example, CO2 and nitrogen present in combustion gases can be 
readily separated from each other by the selective hydrate formation 
method. One problem associated with the approach is the slow kinetics 
of hydrate formation. It is, therefore, proposed to find ways to 
increase the kinetics by using additives. The gas-gas separation 
process by forming hydrates can have higher capacity and lower cost 
than other methods.
    The proposed research can also lead to the development of efficient 
methods for extracting methane from hydrate resources. The National 
Energy Technology Laboratory is spearheading a program to extract 
methane from the Alaskan North Slope with the objective of producing 
methane by 2015. CAST will explore the possibility of extracting 
methane from marine hydrate resources. It is estimated that the United 
States has 200,000 Tcf of methane as hydrate, while the proven reserve 
for dry natural gas is only 238 Tcf. The Blake Ridge deposit alone, off 
the shores of the Carolinas, has 1,300 Tcf of methane. Thus, the 
research on gas hydrate will lead to the development of unconventional 
gas resources, development of efficient gas-gas separation methods, 
sequestration of CO2 as hydrate, and transport and storage 
of methane and hydrogen.

                            FUNDING REQUEST

    It is requested that $3 million of funding for CAST be added to the 
fiscal year 2010 Fuels Program budget, Fossil Energy R&D, U.S. 
Department of Energy. Continued funding will allow CAST to develop 
advanced technologies for producing domestic energy resources in an 
environmentally acceptable manner, while helping developing countries 
reduce CO2 emissions. The new technologies can also minimize 
concerns related to ash and refuse ponds and the runoff water at 
valley-fill mining operations. In addition, the new gas-gas separations 
technologies will have crosscutting applications for a wide spectrum of 
the Fossil Energy R&D programs.
                                 ______
                                 
  Prepared Statement of the Friends Committee on National Legislation 
                               (Quakers)

    The Friends Committee on National Legislation (Quakers) thanks the 
subcommittee for the opportunity to submit this testimony for the 
record. We appreciate the subcommittee's transparency and willingness 
to open its proceedings to the public. The Washington Post paraphrased 
NNSA Administrator Thomas D'Agostino's testimony before the House 
Appropriations Energy and Water Development Subcommittee on March 24 as 
saying, ``the number of new plutonium triggers that will be needed to 
keep the U.S. nuclear weapons stockpile reliable and secure has 
steadily dropped from 450 a year to 20.''
    Decreased demand, paired with President Obama's call for drastic 
reductions in the U.S. nuclear arsenal, requires for changes at NNSA. 
Our testimony centers on the need to restructure the NNSA budget in 
order to meet today's security demands by adequately funding nuclear 
nonproliferation programs, supporting disablement and dismantlement 
programs in North Korea, reforming spending on the nuclear weapons 
complex, and discontinuing new nuclear weapons programs.

                   NUCLEAR NONPROLIFERATION PROGRAMS

    The subcommittee's commitment to nuclear nonproliferation programs 
has increased international security. The best example of that 
commitment is the increased funding allocated to the Global Threat 
Reduction Initiative (GTRI) in the omnibus appropriations bill for 
fiscal year 2009. Testifying before the Senate Appropriations 
Subcommittee on Energy and Water Development last year (April 30, 
2008), former NNSA Deputy Administrator for Defense Nuclear 
Nonproliferation William Tobey pointed out the successes of GTRI:

    The GTRI program, and its antecedents, have removed approximately 
68 nuclear bombs' worth of highly enriched uranium and secured more 
than 600 radiological sites around the world, collectively containing 
over 9 million curies, enough radiation for approximately 8,500 dirty 
bombs. In the United States the GTRI program has removed over 16,000 
at-risk radiological sources, totaling more than 175,000 curies--enough 
for more than 370 dirty bombs.

    A graph of funding for GTRI over the past 4 years shows why the 
program has succeeded. We thank the subcommittee for supporting GTRI 
and believe, as is evidenced by Deputy Administrator Tobey's testimony, 
that the marginal benefit to international security from every dollar 
spent on nuclear nonproliferation programs is greater than that of any 
other dollar spent on national defense.




    Other nuclear nonproliferation programs, such as the International 
Nuclear Materials Protection and Cooperation Program (MPC&A), which 
secures weapons-usable nuclear material in other countries, are in need 
of similar funding increases to accelerate the speed of finding and 
securing nuclear material, and upgrading the infrastructure which keeps 
weapons-grade material out of the wrong hands. As you can see, the 
previous administration's requests for MPC&A funding has been just 
above stagnant over the past several years. This year, Congress cut 
funds for MPC&A by $230 million because the program is winding down in 
Russia. Nevertheless, we believe the program should be expanded beyond 
Russia. Increasing and expanding MPC&A could be critical to achieving 
President Obama's goal to account for and secure all nuclear warheads 
and loose nuclear material around the world by the end of his first 
term.




    We call on the subcommittee to make sufficient investments in the 
next generation of nuclear nonproliferation scientists. President Obama 
has stated that a top priority of his administration will be 
negotiating a verifiable fissile material cutoff treaty. Without 
expanding the pool of safeguards and other nonproliferation experts and 
drawing new talent into the field, the President's goal will not be 
achieved.
    Administrator D'Agostino testified before the House Appropriations 
Energy and Water Development Subcommittee that the Federal Government 
has been unable to lure top tier scientific talent at institutions of 
higher learning away from the private sector. The Administrator pointed 
to fields such as radioanalytic chemistry, in which graduates could 
seek research careers in nuclear forensics. Instead, these students are 
increasingly choosing lucrative offers from private industry over the 
opportunity to serve the country. The subcommittee must determine ways 
to reverse this trend.

                        NUCLEAR WEAPONS COMPLEX

    Administrator D'Agostino was blunt in pointing out that, ``We must 
stop pouring money into an old, cold war complex that is too big and 
too expensive.'' We could not agree more strongly. The discourse over 
the size and scope of the nuclear weapons complex in recent years has 
mirrored moral, political, and global realities that nuclear weapons 
are becoming obsolete.
    The numbers are striking. In 2005, NNSA proposed a new plutonium 
production facility with a capacity of 450 pits per year. In 2006, this 
figure was reduced to a capacity of 125 pits per year. Again, in 2007, 
the estimated necessary capacity was reduced to 80 pits per year. 
Administrator D'Agostino's testimony indicated that due to the changes 
on nuclear policy set forth by President Obama, NNSA is operating at 
the minimum production capacity of 20 pits per year. Simply put, with 
every passing year, the need for a large-scale capacity to produce 
plutonium pits bounds toward zero.
    We recommend abandoning expensive plans to build new plutonium 
production facilities and focusing on how to secure existing facilities 
while decreasing pit production capacities as the country reduces its 
nuclear stockpile and pushes nuclear weapons toward irrelevance.

                          NEW NUCLEAR WEAPONS

    Proponents of new nuclear weapons have been unable in past years to 
justify to lawmakers a need for programs like the nuclear ``bunker 
buster'' and so-called Reliable Replacement Warhead. Congress has 
declined to fund these programs year after year, culminating with a 
line in the fiscal year 2009 omnibus appropriations bill, ``Development 
work on the Reliable Replacement Warhead will cease.''
    Developing new nuclear weapons sends the wrong message to other 
nations. Rather than leading the way on the path to a nuclear weapons 
free world, the United States would be perceived as taking provocative 
actions and possibly spur reactions that increase global nuclear 
proliferation.
    The subcommittee's scrutiny of nuclear weapons programs in a 
bipartisan basis has led to responsible decisions that avoid sending 
these mixed messages and demonstrate the leadership necessary to move 
forward on the bold changes necessary to achieve the elimination of 
nuclear weapons.

               NORTH KOREAN DISABLEMENT AND DISMANTLEMENT

    Last year, the Bush administration secured a waiver to the 1994 
Glenn amendment to enable the National Nuclear Security Administration 
to provide assistance for the disablement and dismantlement of North 
Korea's nuclear facilities. However, the waiver, which passed in a 
supplemental appropriations bill for fiscal year 2008 (Public Law 110-
252, sec. 1405), has not been implemented. The Obama administration 
must implement this waiver to allow for these activities to occur. We 
ask that the subcommittee encourage the administration to implement the 
waiver despite North Korea's recent actions. Should the six party talks 
with North Korea resume and inspectors be allowed back into North 
Korea, delays in implementing the waiver would only slow disablement 
and dismantlement programs.
    Additionally, we urge the subcommittee to fund dismantlement and 
disablement activities in the fiscal year 2009 supplemental 
appropriations bill and the fiscal year 2010 budget at the level of the 
administration's request.
    Thank you for your consideration.
                                 ______
                                 
           Prepared Statement of Southern Company Generation

    Mr. Chairman and members of the subcommittee, Southern Company 
operates the U.S. Department of Energy's (DOE's) National Carbon 
Capture Center (NCCC) at the Power Systems Development Facility (PSDF) 
in Wilsonville, AL (http://psdf.southernco.com) for DOE's National 
Energy Technology Laboratory (NETL) and several industrial 
participants.\1\ The PSDF was conceived as the premier advanced coal 
power generation research and development (R&D) facility in the world. 
It has fulfilled this expectation. I would like to thank the Senate for 
its past support of the PSDF and request the subcommittee's continued 
support as the PSDF responds to the need for developing cost-effective 
carbon dioxide (CO2) capture technology for coal fueled 
power generation. This statement supports the administration's budget 
request for DOE coal R&D which includes about $41.5 million for work at 
the PSDF. These funds are necessary to conduct the future test program 
developed in collaboration with DOE which includes wide-ranging support 
of the DOE Carbon Sequestration Technology Roadmap. The future focus of 
the PSDF is to conduct sufficient R&D to advance emerging 
CO2 control technologies to commercial scale for effective 
integration into either combustion or Integrated Gasification Combined 
Cycle (IGCC) processes.
---------------------------------------------------------------------------
    \1\ Current PSDF participants include Southern Company, the 
Electric Power Research Institute (EPRI), American Electric Power, 
Luminant, Peabody Energy, Arch Coal, Inc., and Rio Tinto.
---------------------------------------------------------------------------
    A key feature of the PSDF is its ability to test new carbon capture 
technologies for coal-based power generation systems at an integrated, 
semi-commercial scale. Integrated operation allows the effects of 
system interactions, typically missed in un-integrated pilot-scale 
testing, to be understood. The semi-commercial scale allows the 
maintenance, safety, and reliability issues of a technology to be 
investigated at a cost that is far lower than the cost of commercial-
scale testing. Capable of operating at pilot to near-demonstration 
scales, the PSDF is large enough to produce data to support commercial 
plant designs, yet small enough to be cost-effective and adaptable to a 
variety of technology research needs.
    In addition to semi-commercial scale testing, the PSDF will serve 
as a test bed for cost-effective technology screening by providing 
slipstreams of actual syngas from coal gasification and flue gas from 
coal combustion. Future test work at the PSDF will include the scale-up 
and continued development of several CO2 capture 
technologies being developed either at DOE's NETL facility, at private 
R&D laboratories or at the PSDF. The DOE program for CO2 
capture in coal-fueled powerplants is divided into three areas: post-
combustion capture for conventional pulverized coal plants, pre-
combustion capture for coal gasification powerplants, and oxy-
combustion processes which produce a more CO2-rich flue gas 
than conventional combustion for easier CO2 capture. The 
PSDF's CO2 capture efforts would address all three areas.
    Southern Company also supports the goals of the Clean Coal 
Technology Roadmaps developed by DOE, EPRI, and the Coal Utilization 
Research Council (CURC). These Roadmaps identify the technical, 
economic, and environmental performance that advanced clean coal 
technologies can achieve over the next 20 years. Over this time period 
coal-fired power generation efficiency can be increased to over 50 
percent (compared to the current fleet average of 32 percent) while 
producing de minimis emissions and developing cost-effective 
technologies for CO2 management.

                                SUMMARY

    The United States has historically been a leader in energy 
research. Adequate funding for fossil energy research and development 
programs, including environmental and climate change technologies will 
provide our country with secure and reliable energy from domestic 
resources while protecting our environment. Current DOE fossil energy 
research and development programs for coal, if adequately funded, will 
assure that a wide range of electric generation options are available 
for future needs. Congress faces difficult choices when examining near-
term effects on the Federal budget of funding energy research. However, 
continued support for advanced coal-based energy research is essential 
to the long-term environmental and economic well being of the U.S. 
Prior DOE clean coal technology research has already provided the basis 
for $100 billion in consumer benefits at a cost of less than $4 
billion. Funding the administration's budget request for DOE coal R&D 
and long-term support of the Clean Coal Technology Roadmap can lead to 
additional consumer benefits of between $360 billion and $1.38 
trillion.\2\ But, for benefits to be realized from advanced coal R&D, 
the critically important R&D program outlined in the Clean Coal 
Technology Roadmap must be conducted.
---------------------------------------------------------------------------
    \2\ EPRI Report No. 1006954, ``Market-Based Valuation of Coal 
Generation and Coal R&D in the U.S. Electric Sector'', May 2002.
---------------------------------------------------------------------------
    One of the key national assets for achieving these benefits is the 
PSDF. The fiscal year 2010 funding for the PSDF needs to be about $41.5 
million to support construction of new facilities to test technologies 
that are critical to the goals of the DOE Carbon Sequestration 
Technology Roadmap and to the success of the development of cost-
effective climate change technologies that will enable the continued 
use of coal to supply the Nation's energy needs. The major 
accomplishments at the PSDF to date and the future test program planned 
by DOE and the PSDF's industrial participants are summarized below.

                          PSDF ACCOMPLISHMENTS

    The PSDF test-bed has operated successfully for many years in 
support of U.S.-DOE's advanced coal program. Skilled staff from 
disciplines essential for a successful research program has gained 
experience by designing and operating the test equipment and by working 
with vendors to develop and improve their technologies. The PSDF has 
developed testing and technology transfer relationships with over 50 
vendors to ensure that test results and improvements developed at the 
PSDF are incorporated into future plants. In some instances, testing 
has eliminated technologies from further consideration. Such screening 
is valuable in that it concentrates R&D effort on those technologies 
most likely to succeed and is an essential part of managing the U.S.-
DOE's financial resources. Major subsystems tested and some highlights 
of the test program at the PSDF include:
    Transport Reactor.--The transport reactor has been operated 
successfully on sub-bituminous, bituminous, and lignite coals as a 
pressurized combustor and as a gasifier in both oxygen- and air-blown 
modes and has exceeded its primary purpose of generating gases for 
downstream testing. Since modifications were made in 2006, subsequent 
testing with air-blown gasifier operations has indicated substantial 
improvements in syngas heating value and carbon conversion. This 
transport technology is projected to be the lowest capital cost coal-
based power generation option, while providing the lowest cost of 
electricity and excellent environmental performance.
    Advanced Particulate Control.--Two advanced particulate removal 
devices and 28 different filter elements types have been tested to 
clean the product gases, and material property testing is routinely 
conducted to assess their suitability under long-term operation. The 
material requirements have been shared with vendors to aid their filter 
development programs.
    Filter Safe-Guard Device.--To enhance reliability and protect 
downstream components, ``safe-guard'' devices that reliably seal off 
failed filter elements have been successfully developed.
    Coal Feed and Ash Removal Subsystems.--A key to successful 
pressurized gasifier operation is reliable operation of the coal feed 
system and ash removal systems. Developmental work on the pressurized 
coal feed systems has increased the understanding and optimization of 
their performance. Modifications developed at the PSDF and shared with 
equipment suppliers allow current coal feed equipment to perform in a 
commercially acceptable manner. An innovative, continuous process has 
also been designed and successfully tested that reduces capital and 
maintenance costs and improves the reliability of fine and coarse ash 
removal.
    Syngas Cooler.--Syngas cooling is of considerable importance to the 
gasification industry. Devices to inhibit erosion, made from several 
different materials, were tested at the inlet of the gas cooler and one 
ceramic material has been shown to perform well in this application.
    Advanced Syngas Cleanup.--A slipstream unit has provided a very 
flexible test platform for testing numerous syngas contaminant removal 
technologies to improve environmental footprint and reduce costs in 
IGCC gas clean-up.
    Sensors and Automation.--Significant progress with sensor 
development and process automation has been achieved. More than 20 
instrumentation vendors have worked with the PSDF to develop and test 
their instruments under realistic conditions. Development of reliable 
and accurate sensors for the gasification process has concentrated on 
coal feed, Transport Gasifier, and filter systems. Automatic 
temperature control of the Transport Reactor has been successfully 
implemented.
    Fuel Cell.--Two test campaigns were successfully completed on 0.5 
kW solid oxide fuel cells manufactured by Delphi on syngas from the 
transport gasifier marking the first time that a solid oxide fuel cell 
(SOFC) has been operated on coal-derived syngas. In addition, a NETL-
erected SOFC multi-cell array test skid was used at PSDF to 
successfully conduct parallel testing of many cells directly on coal 
syngas.
    CO2 Capture.--Slipstream CO2 capture testing 
has been completed on both simulated and actual syngas and results have 
been used to design larger test equipment.

                        PSDF FUTURE TEST PROGRAM

    Developing technology options that will reduce CO2 
emissions is a primary goal for future work at PSDF. These technologies 
will be screened in close collaboration with NETL for selection for 
testing at the PSDF. This facility will serve as a productive test-bed 
for developing advanced technology and is capable of operating from 
bench- and pilot-scale to near demonstration scales allowing results to 
be scaled to commercial application. The PSDF will concentrate on 
developing cost-effective, commercially viable carbon capture 
technology for coal-fueled powerplants through scale-up and continued 
development of several technologies (including for example those being 
developed either at DOE's facilities or by third party technology 
developers).
    For both new and existing powerplants, post-combustion capture 
technology must be made more efficient and cost-effective. In post-
combustion capture, CO2 is separated from the flue gas in a 
conventional coal-combustion powerplant downstream of the pulverized 
coal boiler. Many technologies are under consideration for post-
combustion capture, but these technologies need to be proven and 
integrated in an industrial powerplant setting. Activities at the PSDF 
for post-combustion capture technology will include:
    Pilot-Scale Test Modules.--Pilot-scale test modules of advanced 
post-combustion technologies will be designed, installed, and operated 
in an existing pulverized coal plant adjacent to the PSDF. The flexible 
design of these test modules will allow the testing of a wide range of 
technologies on actual flue gas.
    Technology Screening.--Available solvents developed by NETL, PSDF 
and others will be screened to assess readiness for testing at the site 
using improved contacting devices that are now under development.
    Alternative Solvent Processes.--Alternative solvents with lower 
heats of regeneration and more compact, lower cost gas-liquid 
contacting equipment will be developed and tested.
    Advanced Technology.--Compact membrane contactors and solid phase 
CO2 sorbents that are currently being investigated by DOE-
NETL and private companies will be assessed and installed. PSDF will 
provide a scaled-up testing platform for these technologies as 
development progress warrants.
    In pre-combustion capture, CO2 is separated from the 
syngas in a coal gasification powerplant upstream of combustion in the 
gas turbine. Research & development activities at PSDF for pre-
combustion capture technology for application to gasification-based 
power generation include:
    Advanced CO2 Capture Systems.--New solvents and gas-
liquid contacting devices will be evaluated on air-blown and oxygen-
blown syngas. New sorbent-based or membrane-based CO2 
separation technologies will be scaled-up and tested based on progress 
in fundamental R&D by third party developers.
    Water Gas Shift Enhancements.--New water gas shift reactor 
configurations and sizes are planned for testing at the PSDF. The 
operation of shift catalysts when exposed to syngas at the PSDF will be 
optimized and their technical and economic performance will be 
evaluated.
    Advanced Syngas Cleanup.--New advanced syngas cleanup systems will 
be tested for reducing hydrogen sulfide, hydrochloric acid, ammonia, 
and mercury to near-zero levels.
    In order to develop a cost-effective advanced coal powerplant with 
CO2 capture, all process blocks within the powerplant must 
be optimized in addition to the capture block. Including CO2 
capture in an advanced coal powerplant will increase the plant cost of 
electricity (COE), so opportunities to reduce cost in every part of the 
process will be explored. Although highest priority will be given to 
low-cost CO2 capture process development, projects that 
reduce overall process capital and operating costs will also be 
included in the PSDF test plan to partially offset incremental cost 
increases due to the addition of CO2 capture. These cost 
reduction projects include technology development for syngas cleanup, 
particulate control, fuel cells, sensors and controls, materials, and 
feeders.
                                 ______
                                 
                       Prepared Statement of ASME

    Mr. Chairman, ranking member, and members of the subcommittee, the 
ASME Energy Committee is pleased to provide this testimony on the 
fiscal year 2010 budget request for research and development programs 
in the Department of Energy (DOE).

           INTRODUCTION TO ASME AND THE ASME ENERGY COMMITTEE

    The 127,000-member ASME is a nonprofit, worldwide educational and 
technical Society. It conducts one of the world's largest technical 
publishing operations, holds more than 30 technical conferences and 200 
professional development courses each year, and sets some 600 
industrial and manufacturing standards. The Energy Committee of ASME's 
Technical Communities comprises 30 members from 17 divisions of ASME, 
representing approximately 40,000 of ASME's members.
    ASME has long advocated a balanced energy supply mix to meet the 
Nation's energy needs, including advanced coal, petroleum, nuclear, 
natural gas, biomass, solar, wind and hydroelectric power, and energy 
efficient building and transportation technologies. Only such a 
portfolio will allow the United States to maintain its quality of life 
while addressing future environmental and security challenges. 
Sustained growth will also require stability in licensing and 
permitting processes not only for power stations but also for 
transmission and transportation systems.
    A forward-looking energy policy will require enhanced, sustained 
levels of funding for R&D as well as Government policies that encourage 
deployment and commercialization. While the Energy Committee supports 
much of the fiscal year 2010 budget request, especially the increases 
in funds for fundamental scientific research, we wish to reemphasize 
that a balanced approach to our energy needs is critical and we are 
concerned about the decrease in funding for nuclear energy, which is 
essential to meeting our national energy needs.

                            CRITICAL ISSUES

    The Energy Committee would like to point out some critical energy 
issues:
  --Additional investment guarantees for construction of new clean and 
        especially nuclear facilities must be enacted in future energy 
        legislation. These guarantees will enable lower financing costs 
        for a variety of energy technologies leading to lower energy 
        costs for the American public. Extending these programs further 
        into the future will allow a reasoned rate of increase in 
        construction and application of these technologies for electric 
        generation.
  --There is a critical shortage of trained persons in the workforce at 
        all levels. This includes persons in the various building 
        trades that will be involved in the construction of our energy 
        systems, persons in the manufacturing industry that will 
        manufacture the components that make up our energy systems, 
        persons who will be available to operate and maintain the 
        energy systems when they are built, and persons trained as 
        engineers and scientists at all levels who will perform the R&D 
        and design functions for all energy systems. A recent 
        initiative, ``Regaining our ENERGY Science and Engineering 
        Edge'' or ``RE-ENERGYSE,'' a program being conducted jointly by 
        the DOE EERE and the National Science Foundation (NSF) and 
        geared to young scientists and engineers, is a positive step 
        toward addressing this chronic issue.

                             FOSSIL ENERGY

    The fiscal year 2010 budget request of $884 million for fossil 
energy represents a $513 million decrease over the fiscal year 2009 
appropriation. Fossil Energy Research and Development would be reduced 
$112 million to $403 million. The R&D budget for oil and natural gas 
related research has been eliminated. It should be noted that the DOE 
Office of Fossil Energy received $3.4 billion for Research and 
Development as part of ARRA, for research, development and deployment 
of carbon capture and sequestration, therefore the ASME Energy 
Committee supports this funding request. The Energy Committee supports 
the current proposed funding for coal research programs at $617 million 
for fiscal year 2010. The effective use of coal in today's environment 
demands an increase in efficiency and a decrease in release of 
environmentally harmful waste streams. A large portion of this effort 
right now is the Clean Coal Program Initiative (CCPI), which received 
$1.5 billion as part of ARRA and therefore, did not request any 
additional funding for fiscal year 2010. This approach builds on 
technological R&D advancements in IGCC and CCS technology achieved over 
the past 5 years and provides commercial-scale demonstration 
opportunities for fossil energy powerplants.
    The use of more efficient processes for coal use, such as advanced 
integrated gasification combined cycle technology, combined with carbon 
sequestration will allow the United States to utilize its coal 
resources in a more environmentally sound and cost effective manner. We 
encourage strong and consistent funding for these programs now and in 
future years.

                        ADVANCED FUELS RESEARCH

    The Energy Committee agrees that the advanced fuels research should 
be aimed at fuels used in the transportation system. We believe that 
the development of transportation fuel systems that are not petroleum 
based is a critical part of our future national energy policy. The 
fiscal year 2010 budget for biomass and bio-refinery systems R&D is 
increased by $18 million to $235 million. The Energy Committee 
encourages Congress to ensure that these research programs continue to 
receive adequate funding. We are also pleased to see the increase to 
$330 million in the effort related to vehicle technologies with a 
program emphasis on plug-in hybrid electric vehicles.

                             NUCLEAR ENERGY

    The Energy Committee is discouraged to see a steep decrease in the 
DOE Nuclear Energy budget to $844 million in fiscal year 2010. Even 
with the reduction of the MOX fuel fabrication facility from the 
Nuclear Energy budget, placing it back with the Nuclear National 
Security Administration (NNSA), the nuclear R&D portion of the budget 
request is reduced by $112 million to $403 million for fiscal year 
2010. Because of the sharp reduction in funding, and the decision to 
exclude the Office of Nuclear Energy from ARRA, the Committee strongly 
recommends restoring funding for DOE Office of Nuclear Energy to at 
least the levels appropriated in fiscal year 2009. Nuclear power, as a 
non-greenhouse gas-emitting resource, is a critical component of a 
diverse U.S. power generation mix and should play a larger role in the 
Nation's base power supply. Sustained increases in nuclear power 
research are justified by the imperative of low cost, low emissions 
electricity.
    Proposed increases in the Nuclear Energy budget are most evident in 
the Generation IV Nuclear Energy Systems, $191 million, Fuel Cycle R&D, 
$192 million, and Nuclear Power 2010 program at $20 million. The 
primary decrease is in the Generation IV Nuclear Systems Initiative 
which is $45 million. The Energy Committee believes that nuclear 
generated electricity is important to the Nation, especially in a more 
carbon conscious environment. Therefore continued R&D looking at 
advanced nuclear systems is critical.
    The GNEP program, before its cessation in the fiscal year 2009 
Omnibus Appropriations bill, was a vital means to enhancing the future 
of safe, reliable, nuclear energy through the establishment of 
international centers for nuclear fuel cycle services for nations both 
large and small. Although no funding is provided for GNEP, the Advanced 
Fuel Cycle Initiative, now called Fuel Cycle R&D, would receive $192 
million in funding in fiscal year 2010. The Energy Committee concurs 
with the DOE goal to establish a full scale demonstration of the 
required facilities, including a burner reactor and fuel recycle plant 
that will not produce a pure plutonium product stream. The ASME Energy 
Committee is disappointed with the cancellation of the GNEP program and 
urges Congress and the administration to reconsider the discontinuation 
of GNEP. GNEP was established as an international effort and many 
international partners had agreed to participate. This is consistent 
with efforts to establish an international nuclear fuel bank.

                 ENERGY EFFICIENCY AND RENEWABLE ENERGY

    The Office of Energy Efficiency and Renewable Energy (EERE) manages 
America's investment in research, development and deployment of the 
Department of Energy's (DOE) diverse energy efficiency and renewable 
energy applied science portfolio. It should be noted that the DOE EERE 
received $16.5 billion as part of ARRA, including $2.5 billion for 
Research and Development. The fiscal year 2010 request of $2.02 
billion, $570 million above the fiscal year 2009 appropriated amount, 
provides a broad and balanced portfolio of solutions to address the 
urgent energy and environmental challenges currently facing our Nation. 
Most of the key EERE programs, including Biomass, Solar, Wind, 
Geothermal, Building Technologies, Vehicle Technologies, and Industrial 
technologies, have received sizable increases in funding to support the 
growth of renewable energy that the United States needs. The potential 
to reduce the production of greenhouse gases and to meet the growing 
need for domestically produced energy justifies sustained and increased 
support for these programs.
    The Fuel Cell Technologies program, formerly known as the Hydrogen 
technology program has been reduced $100 million from the fiscal year 
2009 appropriation. While the administration has publicly indicated 
that they view the probability of fuel cell vehicles as ``low'', this 
program is a key driver in the development of fuel cell technology. The 
Energy Committee encourages restoring funding to the Hydrogen Program 
consistent with the fiscal year 2009 appropriation. The other 
technology program to receive a cut was the Water Power Program, which 
is now requested to receive $30 million in fiscal year 2010--a 25 
percent or $10 million cut from fiscal year 2009. While relatively 
small, this program supports R&D for wave and ocean energy technologies 
as well as conventional and pumped storage hydropower. Water power will 
contribute significantly to the eventual transition to clean and 
renewable power generation in the United States. The Energy Committee 
encourages restoring funding to the Water Power Program consistent with 
the fiscal year 2009 appropriation.
    The integration of renewable electric generating systems into the 
operation of the electricity distribution system is critical to 
economic operation of these systems. DOE's support of R&D into 
distributed systems integration began in fiscal year 2007. The Energy 
Committee believes that R&D related to the integration of the electric 
grid and its control as a national system is imperative to the growth 
of renewable energy generating technologies and we encourage full 
funding for such research.

             SCIENCE AND ADVANCED ENERGY RESEARCH PROGRAMS

    The Energy Committee is pleased by the increased request for the 
Office of Science (OS) which restores the funding trajectory mandated 
in the America Competes Act of 2007. It should be noted that the DOE 
Office of Science received $1.6 billion as part of ARRA. The fiscal 
year 2010 budget proposal of $4.94 billion is an increase of $184 
million over the fiscal year 2009 appropriation. OS programs in high 
energy physics, fusion energy sciences, biological and environmental 
research, basic energy sciences, and advanced scientific computing, 
serves, in some small way, every student in the country. These funds 
support not only research at the DOE Laboratories but also work at a 
large number of universities and colleges. We believe that basic energy 
research will also improve U.S. energy security over the long term, 
through its support for R&D on cellulosic ethanol, advanced battery 
systems, and fusion.

                           OTHER DOE PROGRAMS

    DOE is also very active in areas outside of R&D. The environmental 
remediation program that funds the decommissioning and decontamination 
of old DOE facilities is one such program. The Energy Committee 
questions the advisability of all of the budget decreases in this 
program. The coming resurgence in the commercial nuclear arena is 
likely to deplete the trained professionals available for this program 
as engineers choose to move to the more stable commercial environment. 
Congress should appropriate the budget to ensure that this work is 
accomplished in an expeditious manner.

                               CONCLUSION

    Members of the ASME Energy Committee consider the issues related to 
energy to be one of the most important issues facing our Nation. The 
need for a strong and coherent energy policy is apparent. We applaud 
the administration and Congress for their understanding of the 
important role that scientific and engineering breakthroughs will play 
in meeting our energy challenges. In order to promote such innovation, 
strong support for energy research will be necessary across a broad 
portfolio of technology options. DOE research can play a critical role 
in allowing the United States to use our current resources more 
effectively and to create more advanced energy technologies.
    Thank you for the opportunity to offer testimony regarding both the 
R&D and other parts of the proposed budget for the DOE. The ASME Energy 
Committee is pleased to respond to additional requests for additional 
information or perspectives on other aspects of our Nation's energy 
programs.
    This statement represents the views of the Energy Committee of 
ASME's Technical Communities and is not necessarily a position of ASME 
as a whole.

 
       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page

Alexander, Senator Lamar, U.S. Senator From Tennessee, Questions 
  Submitted by...................................................    88
Alliance for Materials Manufacturing Excellence (AMMEX), Prepared 
  Statement of the...............................................   216
American Association of Petroleum Geologists, Prepared Statement 
  of the.........................................................   222
American Society for Microbiology, Prepared Statement of the.....   220
American Society of Agronomy, Prepared Statement of the..........   231
American Society of Civil Engineers (ASCE), Prepared Statement of 
  the............................................................   164
American Society of Plant Biologists, Prepared Statement of the..   229
American Wind Energy Association, Prepared Statement of the......   226
APS, Prepared Statement of.......................................   196
Archuleta, Deanna, Acting Assistant Secretary for Water and 
  Science, Bureau of Reclamation, Department of the Interior.....   106
    Prepared Statement of........................................   107
ASME, Prepared Statement of......................................   242
Assiniboine and Sioux Rural Water System, Prepared Statement of 
  the............................................................   184

Baker, Ken, Principal Assistant Deputy Administrator for Defense 
  Nuclear Nonproliferation, National Nuclear Security 
  Administration, Department of Energy...........................    51
Bennett, Senator Robert F., U.S. Senator From Utah:
    Opening Statements of........................................ 2, 53
    Questions Submitted by...................38, 79, 143, 145, 152, 154
Biomass Energy Research Association (BERA), Prepared Statement of 
  the............................................................   206
Board of Levee Commissioners for the Yazoo-Mississippi Delta, 
  Prepared Statement of the......................................   166
Board of Mississippi Levee Commissioners, Prepared Statement of 
  the............................................................   179
Bond, Senator Christopher S., U.S. Senator From Missouri, 
  Statement of...................................................   121

Calaveras County Water District, Prepared Statement of the.......   172
California State Coastal Conservancy, Prepared Statement of the..   167
Center for Advanced Separation Technologies, Virginia Polytechnic 
  Institute and State University, Prepared Statement of the......   234
Central Utah Water Conservancy District, Prepared Statement of 
  the............................................................   196
Chu, Hon. Steven, Secretary, Department of Energy................     1
    Prepared Statement of........................................     5
    Statement of.................................................     3
Cochran, Senator Thad, U.S. Senator From Mississippi:
    Questions Submitted by.......................................    45
    Statement of.................................................    94
Colorado River Energy Distributors Association (CREDA), Prepared 
  Statement of the...............................................   197
Confederated Tribes of the Umatilla Indian Reservation, Prepared 
  Statement of the...............................................   199
Connor, Michael L., Commissioner, Bureau of Reclamation, 
  Department of the Interior.....................................   111
    Prepared Statement of........................................   113
    Questions Submitted to.......................................   149
Crop Science Society of America, Prepared Statement of the.......   231

D'Agostino, Hon. Thomas P., Under Secretary for Nuclear Security 
  and Administrator, National Nuclear Security Administration, 
  Department of Energy...........................................    51
    Prepared Statement of........................................    57
    Statement of.................................................    54
Denver Water, Prepared Statement of..............................   198
Dorgan, Senator Byron L., U.S. Senator From North Dakota:
    Opening Statements of.....................................1, 51, 91
    Questions Submitted by.................................34, 134, 149
Dry Prairie Rural Water System, Prepared Statement of the........   184
.................................................................

Federation of American Societies for Experimental Biology, 
  Prepared Statement of the......................................   204
Feinstein, Senator Dianne, U.S. Senator From California:
    Questions Submitted by.......................................    76
    Statement of.................................................    53
Fort Peck Reservation Rural Water System (Public Law 106-382), 
  Prepared Statement of the......................................   184
Freudenthal, Dave, Governor, State of Wyoming, Prepared Statement 
  of.............................................................   181
Friends Committee on National Legislation (Quakers), Prepared 
  Statement of the...............................................   236

Gas Turbine Association (GTA), Prepared Statement of the.........   201
GE Energy, Prepared Statement of.................................   213
Grand Valley Water Users Association, Prepared Statement of the..   198

Harencak, Brigadier General Garrett, Principal Assistant Deputy 
  Administrator for Military Application, Office of Defense 
  Programs, National Nuclear Security Administration, Department 
  of Energy......................................................    51
Huntsman, Jon M., Jr., Governor, State of Utah, Prepared 
  Statement of...................................................   181

Integrated Building and Construction Solutions (IBACOS), Inc., 
  Prepared Statement of..........................................   211
Izaak Walton League of America, Prepared Statement of the........   174

Landrieu, Senator Mary L., U.S. Senator From Louisiana, Questions 
  Submitted by.................................................139, 145
Little River Drainage District, Prepared Statement of the........   176

Murray, Reed R., Program Director, Central Utah Project 
  Completion Act Office, Bureau of Reclamation, Department of the 
  Interior.......................................................   106
    Prepared Statement of........................................   110
    Questions Submitted to.......................................   154
Murray, Senator Patty, U.S. Senator From Washington, Questions 
  Submitted by..................................................35, 150

National Fish and Wildlife Foundation, Prepared Statement of the.   193
National Mining Association (NMA), Prepared Statement of the.....   225
New Mexico Interstate Stream Commission, Prepared Statement of 
  the............................................................   196
Northern Colorado Water Conservancy District, Prepared Statement 
  of the.........................................................   195

Presler, Mayor Sara, City of Flagstaff, Arizona, Prepared 
  Statement of...................................................   177

Red River Valley Association, Prepared Statement of the..........   157
Richardson, Bill, Governor, State of New Mexico, Prepared 
  Statement of...................................................   182
Ritter, Bill, Jr., Governor, State of Colorado, Prepared 
  Statement of...................................................   182

Salt, Terrence C., Acting Assistant Secretary of the Army, Corps 
  of Engineers--Civil, Department of the Army, Department of 
  Defense--Civil.................................................    91
    Prepared Statement of........................................    97
    Questions Submitted to.......................................   134
    Statement of.................................................    95
Santa Clara Valley Water District, Prepared Statements of the..170, 196
Soil Science Society of America, Prepared Statement of the.......   231
Southern Company Generation, Prepared Statement of...............   239
Southern Ute Indian Tribe, Prepared Statement of the.............   183
State Teachers' Retirement System, State of California, Prepared 
  Statement of the...............................................   209

Tester, Senator Jon, U.S. Senator From Montana, Questions 
  Submitted by...................................................    78
The Nature Conservancy, Prepared Statement of....................   161

Uncompahgre Valley Water Users Association, Prepared Statement of 
  the............................................................   200
Upper Gunnison River Water Conservancy District, Prepared 
  Statement of the...............................................   201
Utah Water Users Association, Prepared Statement of the..........   198

Van Antwerp, Lieutenant General Robert, Chief of Engineers, Corps 
  of Engineers--Civil, Department of the Army, Department of 
  Defense--Civil.................................................   102
    Prepared Statement of........................................   103
    Questions Submitted to.......................................   145
Voinovich, Senator George V., U.S. Senator From Ohio, Questions 
  Submitted by.............................................46, 144, 147

Wyoming Water Association (WWA), Prepared Statement of the.......   183
Wolf, Bob, Director of Program and Budget, Bureau of Reclamation, 
  Department of the Interior.....................................   111

 
                             SUBJECT INDEX

                              ----------                              

                      DEPARTMENT OF DEFENSE--CIVIL

                         Department of the Army

                       Corps of Engineers--Civil

                                                                   Page

Additional Committee Questions...................................   134
American Recovery and Reinvestment Act...........................   100
Budget:
    Priorities...................................................   127
    Process......................................................   118
    Request......................................................   144
Center Hill and Wolf Creek Dams..................................   132
Chickamauga Lock.................................................   131
Civil Works Program..............................................   145
Construction Program.............................................   104
Earmarks.........................................................   135
Economic Recovery Act............................................   125
Environmental Restoration........................................   119
Everglades.......................................................   136
Fiscal Year 2010 Discretionary Funding Program...................    98
Flood Relief Authority...........................................   122
Fort Peck Reservoir..............................................   128
Great Lakes......................................................   147
Inland Waterways:
    Legislation..................................................    99
    Trust Fund...................................................   136
Investigations Program...........................................   104
Missouri River...................................................   121
    Recovery:
        Implementation Committee.................................   129
        Plan.....................................................   127
Norfolk Harbor, Craney Island, VA................................   135
Objective Performance Guidelines.................................   123
Operation and Maintenance Program................................   104
Other Initiatives................................................    99
Ozark-Jeta Taylor:
    Hydropower Rehabilitation....................................   143
    Power Plant, AR..............................................   135
Planning Improvements and Performance-based Budgeting............   100
Red River Valley Flooding........................................   133
Summary of Fiscal Year 2010 Program Budget.......................   103
Terminating Projects.............................................   125
The American Recovery and Reinvestment Act.......................   144
Value of the Civil Works Program to the Nation...................   105

                          DEPARTMENT OF ENERGY

Accelerating Loan Guarantees.....................................    31
Additional Committee Questions...................................    34
ARPA-E...........................................................    40
Blue Ribbon Commission...........................................    14
Clean Up Funding.................................................    45
CO2 Sequestration.....................................    21
Cyber Security...................................................    44
Decarbonizing Coal...............................................    32
Desert Protection................................................    22
Energy Innovation Hubs...........................................    43
Fossil Energy--FutureGen.........................................    39
Fostering the Revolution in Energy Supply and Demand While 
  Positioning the United States to Lead on Global Climate Change 
  Policy.........................................................     8
Funding Allocations..............................................    12
Geothermal.......................................................    26
Hydrogen.........................................................    13
    Fuel Cells...................................................    29
Idaho National Lab--Next Generation Nuclear Plant (NGNP).........    42
Improving the Management of the Department.......................    11
Industry Letter..................................................    38
Innovation Hubs..................................................    18
Investing in Science to Achieve Transformational Discoveries.....     6
Loan Guarantee Program...........................................    20
Loan Guarantees..................................................    15
    Loan Program--3.5 Years and No Rewards.......................    38
Maintaining the Nuclear Deterrent, Reducing the Risk of Nuclear 
  Proliferation, and Advancing Nuclear Legacy Clean-up...........    10
Not all Science Funding is Equal--Especially at the Weapons Labs.    38
Nuclear:
    Energy.......................................................    41
    Power........................................................    15
Pensions.........................................................30, 42
Recovery Funds...................................................    17
Recycling Spent Fuel.............................................    31
Renewable Portfolio Standard.....................................    33
Science..........................................................    40
Strategic Petroleum Reserve......................................    25
The Need for Scientific Leadership Within the NNSA...............    39
Uranium Taxes....................................................    44
Waste Cleanup....................................................    23
Water Power......................................................    24
Weatherization...................................................27, 44
Wind:
    And Grid Investments.........................................    26
    Dynamometer..................................................    30
    Energy.......................................................    20
Yucca Mountain...................................................    42

                National Nuclear Security Administration

Additional Committee Questions...................................    76
Advanced Computing...............................................    82
Costs and Results of Nuclear Laboratory Privatization............    72
Cut to Nonproliferation and Detection Research and Development...    84
Cyber Security...................................................    86
Defense Nuclear Nonproliferation Overview........................    60
Does This Administration Support Improved Weapons Use-Denial 
  Strate- 
  gies?..........................................................    82
Future of the Los Alamos Neutron Science Center..................    66
Highly Enriched Uranium in Russia................................    85
Impact of Flat-funding on Weapons and Non-proliferation Programs.    69
Laser-powered Fusion Energy......................................    74
Naval Reactors...................................................    86
    Overview.....................................................    61
Not All Science Funding is Equal--Especially at the Weapons Labs.    79
Nuclear:
    Non-proliferation............................................    68
        Efforts..................................................    77
    Posture Review, Weapons Treaty Negotiation, and Stockpile 
      Reduction..................................................    71
    Weapons......................................................    76
Part:
    1--Zia.......................................................    83
    2--Sequoia...................................................    84
Pension Shortfalls...............................................    87
Research Integration Between the Department of Energy and 
  National Nuclear Security Administration.......................    70
Science Funding Trends...........................................    67
Security.........................................................    86
Strategic Posture Commission--Investment in Infrastructure.......    80
Transferring the Tritium Mission is a Waste of Taxpayer Dollars..    81
Weapons:
    Activities Overview..........................................    58
    Labs.........................................................    77

                       DEPARTMENT OF THE INTERIOR

                         Bureau of Reclamation

Additional Committee Questions...................................   134
Aging Infrastructure.............................................   150
Bureau of Reclamation............................................   106
California Bay-Delta Restoration Fund (CALFED)...................   117
Central Valley Project Restoration Fund..........................   116
Desalination Research and Development............................   153
Drought Assistance...............................................   124
Fiscal Year 2010 Planned Activities..............................   117
Odessa Subarea Special Study.....................................   150
Overview of the Fiscal Year 2010 Budget..........................   108
Pick Sloan Legislative Proposal (Bureau of Reclamation)..........   110
Policy and Administration........................................   116
Project Evaluation...............................................   120
Quagga Mussels...................................................   152
Rural Water......................................................   149
    Infrastructure...............................................   130
Saint Mary's Canal Project.......................................   129
San Joaquin River Restoration Fund...............................   117
Tackling Climate Impacts.........................................   109
The First 100 Days...............................................   108
Title XVI........................................................   149
Washington State ARRA Funded Projects............................   151
Water:
    And Related Resources........................................   113
    Conservation Initiative......................................   109

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