[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]


 
                   IMPROVING OIL SPILL PREVENTION AND 
                 RESPONSE, RESTORING JOBS, AND ENSURING 
                  OUR ENERGY SECURITY: RECOMMENDATIONS 
                 FROM THE NATIONAL COMMISSION ON THE BP 
                    DEEPWATER HORIZON OIL SPILL AND 
                           OFFSHORE DRILLING 

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

                                (112-4)

                             JOINT HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                COAST GUARD AND MARITIME TRANSPORTATION

                                AND THE

                            SUBCOMMITTEE ON
                    WATER RESOURCES AND ENVIRONMENT

                                 OF THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 11, 2011

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure


               Available online at: http://www.fdsys.gov/

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65-484 PDF                       WASHINGTON : 2011 

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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                    JOHN L. MICA, Florida, Chairman

DON YOUNG, Alaska                    NICK J. RAHALL II, West Virginia
THOMAS E. PETRI, Wisconsin           PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         JERRY F. COSTELLO, Illinois
JOHN J. DUNCAN, Jr., Tennessee       ELEANOR HOLMES NORTON, District of 
FRANK A. LoBIONDO, New Jersey        Columbia
GARY G. MILLER, California           JERROLD NADLER, New York
TIMOTHY V. JOHNSON, Illinois         CORRINE BROWN, Florida
SAM GRAVES, Missouri                 BOB FILNER, California
BILL SHUSTER, Pennsylvania           EDDIE BERNICE JOHNSON, Texas
SHELLEY MOORE CAPITO, West Virginia  ELIJAH E. CUMMINGS, Maryland
JEAN SCHMIDT, Ohio                   LEONARD L. BOSWELL, Iowa
CANDICE S. MILLER, Michigan          TIM HOLDEN, Pennsylvania
DUNCAN HUNTER, California            RICK LARSEN, Washington
TOM REED, New York                   MICHAEL E. CAPUANO, Massachusetts
ANDY HARRIS, Maryland                TIMOTHY H. BISHOP, New York
ERIC A. ``RICK'' CRAWFORD, Arkansas  MICHAEL H. MICHAUD, Maine
JAIME HERRERA BEUTLER, Washington    RUSS CARNAHAN, Missouri
FRANK C. GUINTA, New Hampshire       GRACE F. NAPOLITANO, California
RANDY HULTGREN, Illinois             DANIEL LIPINSKI, Illinois
LOU BARLETTA, Pennsylvania           MAZIE K. HIRONO, Hawaii
CHIP CRAVAACK, Minnesota             JASON ALTMIRE, Pennsylvania
BLAKE FARENTHOLD, Texas              TIMOTHY J. WALZ, Minnesota
LARRY BUCSHON, Indiana               HEATH SHULER, North Carolina
BILLY LONG, Missouri                 STEVE COHEN, Tennessee
BOB GIBBS, Ohio                      LAURA RICHARDSON, California
PATRICK MEEHAN, Pennsylvania         ALBIO SIRES, New Jersey
RICHARD L. HANNA, New York           DONNA F. EDWARDS, Maryland
STEPHEN LEE FINCHER, Tennessee
JEFFREY M. LANDRY, Louisiana
STEVE SOUTHERLAND II, Florida
JEFF DENHAM, California
JAMES LANKFORD, Oklahoma

                                  (ii)

  


        Subcommittee on Coast Guard and Maritime Transportation

                FRANK A. LoBIONDO, New Jersey, Chairman

DON YOUNG, Alaska                    RICK LARSEN, Washington
HOWARD COBLE, North Carolina         ELIJAH E. CUMMINGS, Maryland
ANDY HARRIS, Maryland                CORRINE BROWN, Florida
FRANK C. GUINTA, New Hampshire       TIMOTHY H. BISHOP, New York
CHIP CRAVAACK, Minnesota             MAZIE K. HIRONO, Hawaii
BLAKE FARENTHOLD, Texas              MICHAEL H. MICHAUD, Maine
JEFFREY M. LANDRY, Louisiana,        NICK J. RAHALL II, West Virginia
  Vice Chair                           (Ex Officio)
JOHN L. MICA, Florida (Ex Officio)

                                 (iii)

  


            Subcommittee on Water Resources and Environment

                       BOB GIBBS, Ohio, Chairman

DON YOUNG, Alaska                    TIMOTHY H. BISHOP, New York
JOHN J. DUNCAN, Jr., Tennessee       JERRY F. COSTELLO, Illinois
GARY G. MILLER, California           ELEANOR HOLMES NORTON, District of 
TIMOTHY V. JOHNSON, Illinois         Columbia
BILL SHUSTER, Pennsylvania           RUSS CARNAHAN, Missouri
SHELLEY MOORE CAPITO, West Virginia  DONNA F. EDWARDS, Maryland
CANDICE S. MILLER, Michigan          CORRINE BROWN, Florida
DUNCAN HUNTER, California            BOB FILNER, California
TOM REED, New York                   EDDIE BERNICE JOHNSON, Texas
ANDY HARRIS, Maryland                MICHAEL E. CAPUANO, Massachusetts
ERIC A. ``RICK'' CRAWFORD, Arkansas  GRACE F. NAPOLITANO, California
JAIME HERRERA BEUTLER, Washington,   JASON ALTMIRE, Pennsylvania
Vice Chair                           STEVE COHEN, Tennessee
CHIP CRAVAACK, Minnesota             LAURA RICHARDSON, California
LARRY BUCSHON, Indiana               MAZIE K. HIRONO, Hawaii
JEFFREY M. LANDRY, Louisiana         NICK J. RAHALL II, West Virginia
JEFF DENHAM, California                (Ex Officio)
JAMES LANKFORD, Oklahoma
JOHN L. MICA, Florida (Ex Officio)

                                  (iv)

















                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................    vi

                               TESTIMONY

Allen (Ret.), Admiral Thad, National Incident Commander, BP 
  Deepwater Horizon Oil Spill....................................    14
Boesch, Donald F., Member, National Commission on the BP 
  Deepwater Horizon Oil Spill and Offshore Drilling..............    14
Garcia, Terry D., Member, National Commission on the BP Deepwater 
  Horizon Oil Spill and Offshore Drilling........................    14

          PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

Johnson, Hon. Eddie Bernice, of Texas............................    47
LoBiondo, Hon. Frank A., of New Jersey...........................    52

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

Allen (Ret.), Admiral Thad.......................................    54
Boesch, Donald F. and Garcia, Terry D............................    65

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



                   IMPROVING OIL SPILL PREVENTION AND
                 RESPONSE, RESTORING JOBS, AND ENSURING
                  OUR ENERGY SECURITY: RECOMMENDATIONS
                  FROM THE NATIONAL COMMISSION ON THE
                   BP DEEPWATER HORIZON OIL SPILL AND
                           OFFSHORE DRILLING

                              ----------                              


                       Friday, February 11, 2011

                  House of Representatives,
          Subcommittee on Coast Guard and Maritime 
                     Transportation, joint with the
   Subcommittee on Water Resources and Environment,
            Committee on Transportation and Infrastructure,
                                                    Washington, DC.
    The subcommittees met, pursuant to call, at 10:00 a.m. in 
room 2167, Rayburn House Office Building, Hon. Frank A. 
LoBiondo, [chairman of the Subcommittee on Coast Guard and 
Maritime Transportation] presiding.
    Mr. LoBiondo. Good morning. The joint subcommittee hearing 
will come to order. As this is the first meeting of the 
Subcommittee on Coast Guard and Maritime Transportation, I want 
to welcome all of our members, and congratulate Mr. Larsen on 
his selection as ranking member. I can't tell you how thrilled 
I am that you have that position. Rick and I have a long-time 
working relationship. We are going to be off to a great start, 
and I think it's going to be a great session, working together. 
And I certainly look forward to working closely with all the 
Members of the Committee.
    The Subcommittee on Coast Guard and Maritime Transportation 
is meeting in a joint hearing today with the Subcommittee on 
Water Resources and Environment to hear testimony from members 
on the National Commission on the BP Deepwater Horizon Oil 
Spill, as well as Admiral Thad Allen, former Coast Guard 
commandant and national incident commander for the oil spill.
    The BP Deepwater Horizon oil spill was unprecedented in 
size and duration. It left a tremendous natural and economic 
disaster in its wake. The joint Coast Guard and Department of 
Interior investigation into the causes of the explosion and 
sinking of the Deepwater Horizon, as well as the failure of the 
blowout preventer to contain the spill is still ongoing. The 
subcommittee will examine the findings of the official 
investigation, once it is complete.
    While we await the findings of the investigation, the 
National Commission on the BP Deepwater Horizon Oil Spill, as 
well as the report of the national incident commander has 
helped highlight significant questions regarding the best 
methods for the industry and the Federal Government to use to 
prevent and respond to future oil spills.
    This hearing provides the subcommittees with the 
opportunity to hear recommendations of the Commission and the 
national incident commander on the changes needed to Federal 
laws and regulations to help reduce the likelihood of a similar 
event happening in the future.
    I am concerned with the findings of the Commission and the 
national incident commander that officials at all levels of 
government were unfamiliar with the national contingency plan, 
our Nation's 42-year-old blueprint for how to respond to oil 
spills. But I am particularly alarmed that the senior leaders 
of the Department of Homeland Security were either unaware or 
simply misunderstood how the plan functions.
    I am troubled at the failure of the Department's leadership 
to recognize, accept, and follow the plans, and--that slowed up 
the command and the control in the days after the spill, 
undermined public confidence in the government, and may have 
impeded the response.
    But this speaks to a larger issue this subcommittee has 
been concerned about since the Coast Guard was transferred to 
the Department of Homeland Security, and that is the Department 
does not understand nor appreciate the traditional missions of 
the Coast Guard, something we have talked about, something we 
have worried about, and unfortunately, I think, something that 
we see happening.
    While critically important, port security accounts for only 
20 percent of what the Coast Guard does on a daily basis. The 
remaining 80 percent are traditional missions like oil spill 
response. These missions require the Department's leadership to 
understand that they need to commit adequate resources and 
attention, as well as participate fully in training and 
preparedness activities. Unfortunately, that was not the case 
with the BP Deepwater Horizon incident.
    Nearly 20 years ago, the Oil Pollution Act of 1990 was 
created and was a national framework for preventing and 
responding to oil spills in U.S. waters. Since the passage of 
the act, there have been significant changes in the offshore 
production, storage, and transportation of petroleum products. 
And with these changes, the requirements to respond to 
potential incidents have grown more complex. This bill 
demonstrates that we may need to re-examine the requirements 
under current law to ensure they are applicable to present-day 
operations.
    Finally, I would be remiss if I did not take this 
opportunity to remember the 11 Transocean crew members who were 
lost as a result of this tragedy, and to express my sympathy to 
their families, friends, and their coworkers.
    With that, I would like to yield to ranking member, Mr. 
Larsen, for any comments you may have.
    Mr. Larsen. Thank you, Mr. Chairman. And I, as well, am 
excited to be a ranking member here, and working with you. We 
do have a good working relationship over the last several years 
here in Congress, and I look forward to working here on the 
Coast Guard Maritime Transportation Subcommittee with you. 
Thanks, Frank.
    I want to thank you for conducting this joint subcommittee 
hearing, and I welcome the opportunity to discuss these 
recommendations today. I think today the message is clear: 
undertaking deepwater drilling requires a deeper understanding 
of the risks that accompany the clear benefits of deepwater 
drilling.
    Now that we have these recommendations in hand, Congress 
should act to ensure that our policies for offshore drilling 
are rigorous, that they safeguard workers, they benefit the 
economy, and they protect the environment. Too many lives are 
at stake, and too many jobs are at risk for the Congress to 
fail to act. If we cannot tap these offshore resources in a way 
that protects lives and the environment, there will be pressure 
to restrict the use of those resources. That would be 
devastating to the maritime industry, the jobs they support, 
and our economy, as a whole.
    We also need to have Federal agencies with adequate 
resources to prevent another tragedy such as this from 
happening again, and to respond, should we have to respond.
    I want to welcome Admiral Allen today to the subcommittee. 
I have appreciated your willingness to serve the United States 
as commandant of the Coast Guard, as well as the commander of 
this response effort, even following your retirement. And I 
look forward to hearing your observations and recommendations.
    The Deepwater Horizon oil spill was a major human and 
environmental disaster of unprecedented proportions. As a 
representative from the Puget Sound, I understand how 
devastating oil spills would be to a coastal region, and I want 
to do everything we can possible to prevent oil spills from any 
sources occurring in my area of the country, or any other area 
of the country.
    The Commission report today clearly demonstrates that we 
have a long way to go to prevent similar disasters from 
occurring again. Unfortunately, Congress is proposing budget 
cuts into the muscle and to the bone of investments needed for 
economic growth, and to protect our environment. If nothing 
else, the BP spill shows the need for more robust public 
capacity to respond quickly and safely to oil spills, and 
that's reflected in the report.
    The public depends upon Federal agencies to ensure the 
safety of deepwater drilling, and the safety of the men and 
women who work on these platforms. Diminishing this capacity 
through budget cuts is irresponsible, especially considering 
the Commission's call for increased investment.
    Now, some voices in Washington, D.C. argue that we must 
reduce or eliminate regulatory burdens, and in some places I 
agree. But, once again, the BP spill demonstrated that the oil 
and gas industry was subject to too little regulation, and not 
too much. Improved regulation is both necessary in how BP 
implemented safety measures during drilling, and ensuring 
effective, meaningful response plans once the spill occurred. 
So, in fact, some of this does fall on the Federal Government.
    No one is suggesting that we eliminate deepwater drilling 
off our coast. Given what we know now about the risks of this 
drilling, we should put pieces in place to ensure the highest 
level of safety.
    The report revealed what many of us expected to learn about 
the spill. First, the Federal Government's oversight of 
offshore and oil gas drilling was too lax. We didn't do the 
job. Second, Federal agencies and the industry were 
inadequately prepared to effectively stop, track, contain, and 
clean up a spill of this magnitude. And third, we learned that 
the Jones Act, the law which protects and supports a domestic 
maritime industry, was not a hindrance to the Federal 
Government's response to this environmental calamity, and we 
will find--and we will hear this later. And I know that the 
Commission report and Admiral Allen concur with this finding.
    I proposed last year, along with many others, that--at the 
committee's May 19th hearing on the spill, that the country 
take a step back to ensure that any future offshore drilling in 
the Gulf of Mexico lives up to claims of safety and 
reliability. And, if anything, the National Commission's report 
only reaffirms my convictions.
    I look forward today to evaluating the Commission's 
recommendations, and expect that our witnesses this morning 
will provide additional insights on these points.
    When the Exxon Valdez ran aground on Bligh Reef in Alaska 
in 1989, Congress responded with the Oil Pollution Act. Now, 22 
years later, the BP spill demonstrated the need to amend and to 
strengthen that act. And I stand ready to work with Chairman 
LoBiondo and with Chairman Gibbs, with our ranking Democratic 
member, Congressman Rahall, and with Mr. Bishop and the other 
Members of this Committee in shaping legislation to strengthen 
our Nation's oil spill response and prevention laws.
    Mr. Chairman, the Deepwater Horizon spill exposed the real 
risks and costs of energy production on the outer continental 
shelf. We have before us an opportunity to make the necessary 
course correction in our production of offshore energy. And I 
urge that we not let the current debate on the Federal budget 
or regulations deter us from making the necessary investments 
to ensure that offshore drilling can be done safely, 
efficiently, and with minimal harm to our environment and to 
the workers who work on the platforms in the Gulf. Thank you, 
Mr. Chairman.
    Mr. LoBiondo. Thank you, Mr. Larsen. I would now like to 
yield to Chairman Gibbs of the Water Resources Subcommittee--
and Environment--for his statement.
    Mr. Gibbs. Thank you, Mr. Chairman, and I look forward to 
working on the Transportation and Infrastructure Committee, and 
also chair the Water Resources and Environment, as we work to 
improve our infrastructure and oversight in those agencies that 
work on the infrastructure issues dealing with water.
    There are two major Federal laws that relate to oil spills 
like the one in the Gulf of Mexico last year: The Oil Pollution 
Act, and the Clean Water Act. The Oil Pollution Act of 1990, 
OPA, was largely enacted in response to the Exxon Valdez oil 
spill, and has improved the Nation's ability to prevent and 
respond to oil spills. Under OPA, the Coast Guard takes the 
lead in organizing Federal oil spill responses and prevention 
efforts in tidal waters, while the EPA is responsible for 
coordinating efforts in non-tidal and inland waters.
    OPA authorized the use of the oil spill liability trust 
fund, which is capitalized by a per-barrel tax paid by the oil 
industry and penalties paid by responsible parties. That trust 
fund is used to pay for the cost of responding to and removing 
oil spills.
    The second law is the Clean Water Act, which is the 
principal Federal statute for protecting navigable waters and 
adjoining shorelines from pollution. Specifically, section 311 
of the Clean Water Act addresses pollution from oil and 
hazardous substances releases, providing EPA and the Coast 
Guard with the authority to establish a program for preventing, 
preparing for, and responding to oil spills that occur in 
navigable waters of the United States.
    The Act clearly establishes the responsibilities of the 
Federal Government, states, and the maritime transportation 
industries to establish liability and to carry out clean-up, 
restoration, and rehabilitation of natural resources that were 
damaged as a result of the oil spill.
    While the BP oil spill was a monumental disaster, and 
caused the tragic loss of 11 dedicated oil field workers, we 
must ensure that we do not use this as a catalyst to halt or 
hinder domestic energy production. Rather, the Nation requires 
a safe, secure, domestic supply of energy products, now more 
than ever.
    The National Commission on the BP Deepwater Horizon Oil 
Spill has studied this recent oil spill and has made several 
recommendations regarding the Federal response. Many of the 
proposals by the Commission are worth careful review and 
consideration as we move forward.
    Thank you, Mr. Chairman. I look forward to the testimony of 
the witnesses.
    Mr. LoBiondo. Thank you, Mr. Gibbs. I would like to yield 
now to Ranking Member Bishop for his statement.
    Mr. Bishop. Thank you, Mr. Chairman. Thank you for holding 
this important hearing to review the recommendations of the 
National Commission on BP Deepwater Horizon Oil Spill and 
Offshore Drilling.
    Mr. Chairman, as you know, in the last Congress this 
committee held a series of hearings in the aftermath of the BP 
Deepwater Horizon disaster to investigate what went wrong, what 
actions were being undertaken by BP and other responsible 
parties to stop the ongoing flow of oil, and to restore the 
lives and livelihoods of those impacted by the spill, and what 
measures were necessary to restore the Gulf Coast ecosystem.
    These hearings also focused on what efforts needed to be 
undertaken by the Federal agencies and the Congress to ensure 
that a similar preventable disaster could not occur in the 
future.
    Last year, members of the Subcommittees on Water Resources 
and the Coast Guard recalled a similar joint hearing of these 
subcommittees on the 10th anniversary of the Oil Pollution Act 
of 1990, and the warnings given by Federal agencies and other 
stakeholders that our Nation was rapidly becoming unprepared to 
address future oil spills.
    Specifically, witnesses testified about the then-growing 
concern that the technologies to extract, process, and 
transport oil were well outpacing the development of 
technologies to quickly and safely control and clean up 
potential oil spills.
    Over the intervening years, our subcommittees also receive 
testimony from representatives of the Coast Guard that 
currently liability limits for both vessels and facilities such 
as the Deepwater Horizon were falling desperately behind the 
levels necessary to adequately address a worst-case release of 
oil. Unfortunately, this committee did not heed the warnings 
given to it over a decade ago, and this Nation grew complacent 
that a future oil disaster was unlikely to occur again.
    Fast forward 10 years, and unfortunately, our complacency 
proved wrong. In the summer of 2010, our Nation was again faced 
with a massive oil spill, although this time the release was 
not from the grounding of a ship, but from the seemingly 
limitless release of oil directly from the sea floor. Again, 
the questions arose on how this could have happened, why it was 
taking so long to stop the flow of oil, and whether this 
tragedy that resulted in 11 lives lost and impacted countless 
families along the Gulf Coast should have been prevented.
    Mr. Chairman, in the days following the Deepwater Horizon 
disaster, this committee took aggressive action to understand 
what happened and what changes were needed to take to prevent a 
similar disaster in the future. This committee drafted and 
moved legislation to address many of the shortcomings 
identified in the aftermath of the Deepwater Horizon disaster. 
This legislation reported from this committee by voice vote was 
later combined with proposals from our colleagues on the 
Natural Resources Committee under the then-leadership of our 
new ranking member, Mr. Rahall, and was passed by the House in 
early summer. Unfortunately, no further action was taken on 
that bill.
    However, with the beginning of the new Congress, we have 
the opportunity to start anew. Today, Mr. Chairman, we will 
hear testimony from two distinguished representatives from 
President Obama's National Commission. In my opinion, we should 
not be surprised by the findings of the Commission into the 
likely causes of the Deepwater Horizon disaster, or the 
systemic failures of the oil industry that contributed to this 
incident. Many of these findings are consistent with what we 
heard during hearings before this committee in the last 
Congress.
    Similarly, many of the statutory and administrative changes 
recommended by the Commission are consistent with those 
included in both this committee's bill and the Consolidated 
Land, Energy, and Aquatic Resources Act of 2010, or the CLEAR 
Act, that was approved by the House last year.
    Mr. Chairman, in my view, the prudent choice is for this 
committee to once again move legislation to address the 
warnings raised by this Commission and other stakeholders on 
the very real threat of future oil spill disasters. While some 
of the recommendations of the Commission can be addressed 
administratively, we all know that several critical issues, 
such as the currently inadequate liability and financial 
responsibility limits and issues related to maritime safety can 
only be addressed by the Congress.
    Preventing the next Exxon Valdez or Deepwater Horizon is 
far too important to allow complacency to take over again. As 
noted by one of the witnesses last Congress, ``We cannot let 
the months that have passed without a massive oil spill give us 
a false sense of security that everything is fine. We must 
recognize that vulnerabilities remain, and take decisive action 
to address the recommendations made by this commission this 
year.''
    Thank you, Mr. Chairman. I yield back.
    Mr. LoBiondo. Thank you, Mr. Bishop. Now I would like to 
recognize Mr. Rahall, the ranking member of the full committee.
    Mr. Rahall. Thank you, Mr. Chairman. I commend you and 
Ranking Member Larsen for conducting this hearing today. We 
will hear from the Presidential Commission examining the 
Deepwater disaster and retired Admiral Thad Allen regarding the 
recommendations for ensuring that offshore oil and gas 
development in the U.S. is far safer now and in the future, and 
that the devastation of the Deepwater Horizon is not repeated.
    I certainly want to commend our witnesses--you, in 
particular, Admiral Allen--and the Commission, all of the 
people representing our government at all levels for the 
around-the-clock work that they did, and for our country, in 
trying to ensure the safety and return to well-being of so many 
of our citizens.
    While the round-the-clock television coverage of oil 
spewing into the Gulf has long since faded to black, the 
urgency we once felt to identify the causes of the disaster and 
take the steps necessary to minimize the likelihood it would 
happen again should not fade with the coverage. This truly 
cannot become a case of out of sight, out of mind. We cannot 
forget the 11 good men who lost their lives, and countless 
families lost their incomes when fishing grounds were shut down 
and tourists canceled their visits to the Gulf. We cannot 
forget the environmental and economic impacts of the spill that 
will last long after the oil can be seen floating on the 
surface of the sea.
    Yet, in the weeks since the Commission released its broad 
range of recommendations for reforms and business practices, 
regulatory oversight, and broader policy concerns, we have 
heard an outcry of indignation from those who claim that it is 
too soon to take action, that we must wait until every aspect 
of every investigation has been completed.
    But we do not need to wait to know that we were not 
prepared for this type of blow-out, that our ability to clean 
up oil spills is woefully inadequate, that regulators were too 
cozy with the industry, and that a $70 million cap on liability 
is too small.
    That is why, in my former capacity as Natural Resources 
chairman, to which Mr. Bishop has referred, I did lead the 
House in writing and passing the CLEAR Act last summer. That 
legislation would have provided for a major overhaul of 
offshore drilling operations and regulations, decreasing the 
chances that another blow-out would happen in the future, and 
making sure that we could do a better job of containing one, if 
it did.
    Many of my friends who voted against that bill argued that 
we should not act until the Presidential Commission had 
completed its work. Well, the recommendations are now before 
us. And again and again, they urge us to do the exact same 
things we did in the CLEAR Act.
    Recently, we introduced a new bill to implement all the 
Commission recommendations. But again, we're told by some that 
we need to wait. But we cannot wait. The Commission itself 
said--and I quote--``Inaction runs the risk of real cost too, 
and more lost lives, and broad damage to the regional economy 
and its long-term viability, and its--and further tens of 
billions of dollars of avoidable clean-up costs.''
    We should not wait to reform the ranks of the inspectors 
who were supposed to be keeping an eye on--not playing around 
with--industry operators in the Gulf. We cannot wait to reform 
the laws that govern containment, response, and clean-up of 
spills, or to improve the technologies that these activities 
rely upon. Nor should we wait to improve safety and 
environmental protection provisions that will ensure the long-
term sustainability of this industry, as well as the other 
industries that coexist in the Gulf and other areas of the 
country, where offshore energy development continues.
    We have a responsibility. We have a responsibility to the 
families of those who lost loved ones in the Gulf, who lost 
businesses in the aftermath of this disaster, and to the 
American people. We need to act on these recommendations, 
restore the economy and the ecosystems of the Gulf, and make 
sure offshore drilling is done in an efficient and safe manner. 
No one should have to risk their lives to earn a livelihood. 
Thank you, Mr. Chairman.
    Mr. LoBiondo. Thank you, Mr. Rahall. We are going to--we 
will entertain brief opening statements from Members, if they 
so choose. I will try to limit them to three minutes. If you 
can do it in less than that, I would appreciate it, so we can 
get to the meat of the hearing.
    Are there--Mr. Cravaack?
    Mr. Cravaack. Thank you, Chairman LoBiondo and Gibbs, and 
Ranking Members Larsen and Bishop, for holding this imperative 
hearing. Welcome, Admiral Allen. It's good to see you, sir. And 
thank you for your service to this country. Welcome, Dr. 
Boesch, and Mr. Garcia, and I look forward to learning from 
your testimony today, as well.
    A lot of the difficulties our country has faced attempting 
to cap the BP oil spill--it's an imperative that we improve our 
ability to prevent future spills, and expand our country's 
capability to respond and contain an oil spill in order to 
prevent another region-wide catastrophe.
    While understanding the immense technical difficulties 
involved with capping BP's Deepwater blow-out, I am hopeful we 
can apply the lessons learned from BP's oil spill and never 
again have 87 days of oil spewing into our waters, and have a 
government bureaucracy impede recovery in an extremist 
situation.
    In closing, I would just like to extend my sympathy and 
concern for the American families on our Gulf Coast that have 
suffered not only from the effects of BP's oil spill, but also 
because of loss of jobs to the Federal Government's knee-jerk 
reaction in initially banning offshore drilling, and its 
disjointed response to the emergency situation.
    Thank you again, and I do look forward to your testimony.
    Mr. LoBiondo. Thank you. Now I would like to recognize Mr. 
Cummings, former chair of the committee. And I want to publicly 
thank you for your work and cooperation over the last couple of 
sessions, and welcome your remarks.
    Mr. Cummings. Thank you very much, Mr. Chairman, and 
congratulations on your chairmanship. I want to thank the 
chairman of the Subcommittee on the Coast Guard and Maritime 
Transportation and the Subcommittee on Water Resources, 
Congressman LoBiondo and Congressman Gibbs, and certainly our 
ranking members, Larsen and Bishop, for today's hearing to 
enable us to examine the recommendations of the National 
Commission on the BP Deepwater Horizon Oil Spill and Offshore 
Drilling.
    Also, take a moment to thank Dr. Boesch, president of the 
University of Maryland Center for Environmental Science, and 
Mr. Terry Garcia for their service on the National Commission 
on the BP Deepwater Horizon Oil Spill.
    Further, I take a moment to thank Admiral Allen for his 
service managing the Deepwater Horizon incident, and of course 
for service as commandant of the Coast Guard. It's good to have 
Admiral Allen appear before us today.
    And during the 111th Congress, as chairman of the Coast 
Guard Subcommittee, I convened a subcommittee hearing to 
examine foreign vessel operations in the exclusive economic 
zone. And the Committee on Transportation and Infrastructure 
convened two separate hearings to examine the Deepwater Horizon 
accident. I also traveled to the Gulf and had the opportunity 
to observe the on-scene operations at the Macondo site several 
times. And I appreciate the thoroughness of the National 
Commission's report, and the thoughtfulness of the Commission's 
recommendations.
    Last year, under the leadership of then-chairman Rahall and 
former chairman Oberstar, the House passed the CLEAR Act, which 
would have implemented many of the reforms which the Commission 
is calling for today, including increasing the financial 
responsibility requirements for offshore drilling facilities.
    Responding to the issues we examined in the Coast Guard 
subcommittee, this legislation would also have required that 
vessels involved in resource development in the EEZ be owned by 
U.S. citizens who would pay U.S. taxes. The legislation would 
also have required such vessels to be crewed by U.S. citizens 
who would be protected by U.S. safety regulations.
    Further, to help those in the Gulf who were failed by the 
BP claim processing system, the legislation included a 
provision I authored that would have reduced from 90 days to 45 
days the amount of time a responsible party has to settle 
claims before claims could be presented to the oil spill 
liability trust fund. I continue to believe that the CLEAR Act 
is the kind of strong legislation we need to ensure that our 
laws and regulations are equal to the risk involved in offshore 
drilling. My belief is only reconfirmed by the Commission's 
findings and recommendations.
    And so, I look forward to our testimony--to the testimony 
today. I thank the witnesses for being with us. And with that, 
Mr. Chairman, I yield back.
    Mr. LoBiondo. Thank you, Mr. Cummings. Master Chief Coble.
    Mr. Coble. Thank you, Mr. Chairman. I appreciate that 
promotion. I will not take the three minutes. You and Mr. 
Larsen have invited an outstanding panel. I'm looking forward 
to hearing from them. Admiral, good to have you back on the 
Hill. Thanks for what you did. Yield back, Mr. Chairman.
    Mr. LoBiondo. You scored extra points. Good job. 
Congresswoman Richardson.
    Ms. Richardson. Thank you, Mr. Chairman. Thank you for 
having this joint hearing this morning, and also our ranking 
members. And I would like to thank our distinguished witnesses 
who are here today, who are helping us as we progress through 
this very difficult tragedy for this country.
    I asked to speak because I had kind of a unique role. In 
addition to being on Transportation, I was also, at the time, 
chair of the emergency communications preparedness and response 
with the Homeland Security Committee, and so I actually visited 
the Gulf several times to observe the progress from multiple 
areas.
    Within those visits there were some key things that I would 
like to acknowledge. One, I want to thank the Coast Guard and 
the EPA and the other Federal and local agencies who were 
involved in the response, who I thought took tremendous care 
and, really, effort to preserve our coastline and to resolve 
the problem of the millions of gallons of crude oil that was 
streaming into our shores.
    But I think, when we look at, overall, the observations of 
the trip--and I made a report, myself, of that--I want to 
underscore the large challenges that the response teams faced, 
and the lessons that ought to be learned in the aftermath of 
this catastrophe.
    For example, the failure or the confusion about the number 
of booms and skimmers that were located, and where they needed 
to be placed. The confusion surrounding the chain of command 
was exacerbated by the number of governmental agencies that 
comprised the unified response. And, moreover, the magnitude of 
the disaster rendered many of the Federal Government agencies' 
contingency plans almost inoperable.
    I represent California's 37th Congressional District. We 
have offshore drilling in my district. And I am concerned about 
what happened there, and how it can happen again.
    Finally, I brought forward legislation, Securing Health for 
Ocean Resources and Environment Act, called the SHORE Act, one, 
to look at improving at NOAA's spill response and containment 
and prevention capacity; two, better to define to the 
coordination between Federal, state, and local responses--and I 
am disturbed to say that the same problems we had with 
Hurricane Katrina didn't seem to be resolved in our response 
with Federal, state, and local elected officials--to clarify 
the existing authority for NOAA to receive funds from the oil 
spill liability trust fund, to double the amount that Coast 
Guard may receive from the OSLTF each year, with a percentage 
dedicated towards oil spill research and development; to 
mandate the improvements in the frequency and quality of the 
Coast Guard's safety inspections and certification 
requirements; to require prompt posting by the Coast Guard 
unified command of oil spill incident plans publicly, utilizing 
all resources, not depending upon cable TV to tell the message; 
and finally, to strengthen the coastal state oil spill planning 
and response.
    I plan on reintroducing this legislation. But, more 
importantly, I am also very thankful for the report that all of 
you did. And we look forward to working together. I yield back.
    Mr. LoBiondo. Thank you. Congresswoman Miller.
    Mrs. Miller of Michigan. Thank you, Mr. Chairman, to all 
the chairmen. And, you know, with all deference, sitting next 
to a great Marine here, Duncan Hunter--and my dad was a Marine 
and my son-in-law is a Marine, and my husband was in the Air 
Force--hats off to the Coast Guard, and to our witness. I am 
looking forward to hearing Admiral Allen because, as we all 
know, if it's wet and impossible, always ready, send in the 
Coast Guard. And I just want to echo what's been said here this 
morning.
    But just a quick comment, Mr. Chairman, in regards to the 
Jones Act, which is, I think, going to be coming up in the 
witnesses' testimony, and I'm sure there will be some questions 
about that today. I personally believe that the Jones Act is a 
very critical component of America's maritime heritage. And 
during this tragic incident, and the terrible incident in the 
Gulf, Jones Act suffered from an unfortunate, misguided, really 
untrue sort of media campaign against the Jones Act. They were 
saying that the Jones Act actually hindered the clean-up 
efforts, and had a lot of--created a lot of the confusion in 
the Gulf.
    And actually, looking through the admiral's testimony here, 
in regards, as he says, to the application of the Jones Act, 
there was a misperception that the Jones Act impeded the use of 
foreign flag vessels for Deepwater Horizon response operations. 
In reality, the Jones Act had no impact on response operations.
    And just one other quick quote from the report that we all 
have in front of us. We did not reject foreign ships because of 
Jones Act restrictions. These restrictions did not even come 
into play for the vast majority of vessels operating at the 
wellhead, because the act does not block foreign vessels from 
loading or then unloading oil more than three miles off the 
coast. And when the act did apply, the national incident 
commander appears to have granted waivers and exemptions when 
requested.
    So, I just point that out. I think this hearing is a great 
way to explore everything that happened in the Gulf, and in 
particular set to rest a lot of misperceptions that many people 
in our country and around the globe found out about the Jones 
Act. As we see now, it had no negative impact.
    Again, thanks for calling this hearing, Mr. Chairman.
    Mr. LoBiondo. Thank you. The gentlelady from Hawaii, Mrs. 
Hirono.
    Mrs. Hirono. Thank you, Mr. Chairman. And I, too, would 
like to thank the Coast Guard for everything that they do 
there. They are a major part of our response teams in Hawaii.
    And I also would like to echo the sentiments of 
Congresswoman Miller in her explanation of the impact of the 
Jones Act and the misinformation that arose about the Jones Act 
as a result of this BP disaster.
    What strikes me about the Commission's report, moving on to 
that, is that this disaster could have been prevented. And the 
companies that were involved did certain things--commissions 
and omissions--that we really need to ensure never happens 
again. And, as far as I am concerned, there should be some--
there should be major accountability of these companies in the 
follow-up of the disaster.
    And so, what I would like to see the committee do is move 
forward in supporting the recommendations of the Commission. 
And with that, I yield back.
    Mr. LoBiondo. We have the gentleman from coastal Louisiana 
wants to say something. Mr. Landry? There you are.
    Mr. Landry. Yes.
    Mr. LoBiondo. OK.
    Mr. Landry. Thank you, Mr. Chairman. Thank you, Chairman 
Gibbs, for calling this hearing today. I also thank Dr. Boesch, 
Mr. Garcia, for agreeing to serve on the President's 
Commission, and for giving their time to testify today. Admiral 
Allen, I thank you for your service to the country, and for 
everything you have done for the Gulf Coast.
    As our chairman and ranking members have already stated, 
the accident that happened on April 20, 2010 was an economic, 
environmental, and human tragedy that cannot be minimized or 
forgotten now that the images of the accident have stopped 
playing out on the news.
    As the representative for coastal Louisiana, the Macondo 
incident is still seen in every corner of my district. A 
hundred thousand men and women of my district either work or 
are affected by both the commercial fishing industry and the 
oil and gas industry. And while our shrimpers, oystermen, and 
fishermen are doing their best to return to work, my neighbors 
in the oil and gas industry continue to sit at home, sidelined 
by the President's de facto moratorium.
    Every day we fail to utilize our own energy resources in 
the Gulf of Mexico is a day America is held captive on ongoing 
crises in the Middle East, the turmoil in the rest of the 
world. And I wish the Commission's report would have addressed 
the economic impacts of this moratorium.
    I am also concerned with the Commission's recommendation to 
increase the liability cap in financial responsibility 
requirements. Make no mistake. I do not believe that any oil 
and gas company should be able to cause massive damage to our 
national economy and skate away into bankruptcy. However, I 
also believe that small oil and gas producers have a role to 
play in the Gulf of Mexico. And any action which drives these 
producers away will ultimately hurt this Nation.
    I am confident that the system--a system can be implemented 
that protects the environmental health of the Gulf, while still 
ensuring independent drillers are not pushed out of the 
industry.
    More broadly than the recommendations, I disagree with the 
Commission's apparent stance that the entire offshore industry 
can be characterized or quantified by the mistakes or failures 
that happened on April the 20th. There have been more than 
50,000 wells drilled in the Gulf of Mexico, 3,200 of which we 
drilled in deep water. Of these wells, Macondo was the first 
major incident.
    I believe we should always keep in mind--I do agree with 
the Commission's report that we should always keep in mind the 
safety of the men and women who ply their trade in the Gulf of 
Mexico. And with that, I yield back the balance of my time.
    Thank you, Mr. Landry. Mr. Cohen?
    Mr. Cohen. Thank you, Mr. Chairman. I, first, appreciate 
the opportunity to serve on this committee with you, and look 
forward to working with you. And I am pleased to receive the 
testimony that we will be having today from Admiral Allen, and 
the distinguished members of the Commission here on this BP 
Deepwater Horizon oil spill.
    The spill spewed oil into the Gulf of Mexico for 86 days, 
and was a human economic and environmental disaster, 
unparalleled in our country's history, both--but it was both 
foreseeable and it was preventable. Thanks to the swift 
response of Admiral Allen, the administration, and the recovery 
workers in the Gulf, the negative impacts were dramatically 
reduced, yet still great. And as a result of the work performed 
by this Commission, we have a better understanding of the--why 
this spill occurred, and how we can prevent similar tragedies 
in the future.
    The Valdez taught us some things, but the Valdez was about 
property damage, and environmental damage, and maritime damage, 
ecological damage. But there were not a loss of lives. And in 
this situation, we're dealing with the loss of human lives. We 
lost 11 individuals on that rig, and we owe it to those 
individuals and to the thousands of Americans who risk their 
lives every day by stepping on to those type of rigs to heed 
the warnings and try to prevent future tragedies by looking at 
the recommendations and passing them.
    There are tens of thousands of people in the Gulf area 
whose economic livelihoods were devastated, and we owe it to 
them as well. But the main thing is the lives that were lost. 
If you don't learn from history, you're doomed to repeat it. 
And if there are people that die in the future, and we don't do 
things to protect those oil workers there, their blood will be 
on our hands.
    The recommendations laid out are reasonable and practical. 
They're improvements and updates to outdated regulations that 
no longer protect the health and well-being of American people 
and our economies. So I thank the Commission for their work.
    I hope that this Congress will heed the warning signs and 
respond with legislation that will save lives in the future, as 
well as the economies. I thank the witnesses for their work in 
trying to safeguard the people and our environment, and I look 
forward to hearing their testimony and working to try to see 
that American vessels in the future are safer, and that they 
are--approve their American vessels, and not necessarily ones 
that were flagged in the Marshall Islands. Thank you. Thank 
you, Mr. Chairman.
    Mr. LoBiondo. Thank you, Mr. Cohen. Were there any other 
Members that we missed who wanted to say a few opening remarks?
    [No response.]
    Mr. LoBiondo. Seeing none, we will now go to our witnesses. 
And our witnesses today include two members of the National 
Commission on the BP Deepwater Horizon Oil Spill and Offshore 
Drilling. Dr. Donald Boesch is the president of the University 
of Maryland's Center for Environmental Science, and he is 
joined by fellow commissioner, Terry Garcia. Mr. Garcia is the 
executive vice president for the mission programs for the 
National Geographic Society.
    Mr. Boesch, thank you, and please proceed.

 TESTIMONY OF DONALD F. BOESCH, MEMBER, NATIONAL COMMISSION ON 
THE BP DEEPWATER HORIZON OIL SPILL AND OFFSHORE DRILLING; TERRY 
  D. GARCIA, MEMBER, NATIONAL COMMISSION ON THE BP DEEPWATER 
HORIZON OIL SPILL AND OFFSHORE DRILLING; AND ADMIRAL THAD ALLEN 
 (RET.), NATIONAL INCIDENT COMMANDER, BP DEEPWATER HORIZON OIL 
                             SPILL

    Mr. Boesch. Mr. Chairman and members of the subcommittees, 
thank you for giving me and my colleague, Terry Garcia, an 
opportunity to testify on behalf of the National Commission. 
It's an honor to present the Commission's findings concerning 
the explosion and spill, as well as our recommendations for 
change in U.S. policy concerning offshore drilling.
    As a native of Louisiana, and having lived for the 
difficult decade of the 1980s in Houma, Louisiana, I understand 
the importance of the oil and gas industry, both to the local 
economy and the Nation's energy supply. Anyone familiar with 
the region understands the need to maintain a thriving energy 
industry, along with the healthy natural environment, and the 
many benefits that both provide.
    So, it was really deeply personal to me as I witnessed, as 
you did, the damage that was done to our coast, our wetlands, 
our economies, and communities as a result of this spill.
    In May of last year, President Obama created our 
Commission, and asked us to determine the causes of the 
Deepwater Horizon disaster, evaluate the response, and advise 
the Nation about how future energy exploration could take place 
responsibly.
    As you know, on January 11th, exactly 1 month from today, 
we released our final report. As co-chairman Bob Graham has 
previously noted, our report was completed on time, under 
budget, and contains no dissents among our members.
    Our final report includes recommendations directed at the 
administration, at Congress, and at the industry that will help 
to improve the safety of offshore drilling and substantially 
reduce the risk of something like this happening again.
    Today, however, I would like to focus my opening remarks on 
the equally important portion of our recommendations: ways to 
improve the government's oil spill response and containment 
capabilities. In their response to the Deepwater Horizon 
disaster, let's face it, both the government and the industry 
fell short.
    Although many responders acted quickly, and in some cases 
heroically, and although Admiral Allen provided effective and 
valuable leadership during this response, the Commission 
concluded that neither BP nor the Federal Government was 
adequately prepared to respond to a spill of this magnitude and 
complexity. There was a failure to plan in advance, a failure 
to coordinate effectively with state and local governments, and 
a lack of information concerning what response measures would 
be most effective.
    In addition, neither the industry nor the Federal 
Government has invested in the research and development needed 
to improve spill response technology. Much of the technology 
was the same as used during the Exxon Valdez spill 20 years 
earlier.
    Equally troubling at the outset of the spill, the industry 
was unable to contain the flow of oil from the well, and 
neither the government or the industry had sufficient expertise 
to determine the rate at which the oil was flowing. The lack of 
accurate knowledge impeded the efforts to determine the 
appropriate control technology, and determine it quickly.
    All of these factors together made for a long and costly 
response effort that, at least in the early stages, did not 
meet the standard of what the law presently requires. In our 
report, the Commission makes a number of recommendations to 
improve response and containment.
    Among the recommendations: first, the Department of the 
Interior, consulting with other agencies, should develop a more 
rigorous set of requirements for industry response plans, and 
should require companies to submit containment plans, along 
with the oil spill response plans; second, EPA and the Coast 
Guard should involve state and local governments as significant 
players in the spill response planning; Congress should provide 
mandatory funding for oil spill response research and 
development; industry should fund a private organization to 
develop, adopt, and enforce the standards of excellence to 
ensure improvement and equipment for large-scale response and 
containment and rescue; and finally, the Federal Government 
should ensure that this has the needed expertise to oversee 
these industry containment efforts.
    The Commission's recommendations are far-reaching in this 
area. There is a role for Congress, to be sure, the executive 
branch, and the industry, in significantly improving 
capabilities. There is also a role for Congress in conducting 
oversight, as our government takes these actions.
    I will conclude my remarks by noting that the drilling 
offshore is inherently risky. The risk will never be reduced to 
zero. But as a Nation we can take concrete steps that will 
dramatically reduce the chances of another Macondo well blow-
out, and that will substantially improve our ability to 
respond, should an oil spill like this occur again.
    The Commission believes these steps are vitally necessary, 
that people of the Gulf who have suffered so much deserve to 
know that their government and industry are doing so. So, Mr. 
Chairman, thank you for this opportunity. You have our written 
testimony and our report for the record. Thank you.
    Mr. LoBiondo. Thank you, Mr. Boesch.
    Mr. Garcia?
    Mr. Garcia. Good morning, Mr. Chairman, members of the 
subcommittee. Thank you for giving us this opportunity to 
testify concerning the findings and recommendations of the 
National Commission on the BP Deepwater Horizon Oil Spill and 
Offshore Drilling.
    Any severe catastrophe of national significance, like the 
explosion of the Macondo well and the subsequent oil spill in 
the Gulf of Mexico, strains public confidence, fosters 
widespread concern and anxiety, and creates an urgent need for 
candid explanation. But it can also create an opportunity to 
bring a renewed focus to existing challenges. As tragic as this 
disaster was, it can play a positive role in restoring one of 
our Nation's most valuable ecosystems.
    So, today I would like to focus my remarks on the 
Commission's recommendations for the restoration of the Gulf of 
Mexico.
    As a result of the Deepwater Horizon spill, over 170 
million gallons of oil went into the Gulf, with some portion 
remaining in the ocean and possibly settling on the ocean 
floor. But even before the highly visible damages caused by the 
spill became clear, many crucial Gulf economic and ecological 
resources--fisheries, transportation, tourism--faced long-term 
threats.
    First, more than 2,300 square miles of coastal wetlands, an 
area larger than the State of Delaware, have been lost to the 
Gulf. Powerful hurricanes, always a threat to the region, 
struck the coast in 2005 and 2008, causing even more wetland 
loss. Last summer, even before the spill, a massive dead zone, 
extending up to 7,700 square miles, was forming in the Gulf.
    And finally, the Deepwater Horizon disaster made matters 
worse. Eleven rig workers were killed by the explosion, 
seventeen were injured. Many thousands of people were exposed 
to contaminated waters, coast, beaches, and seafood. Thousands 
were out of work. Birds and sea animals killed and significant 
habitats damaged or destroyed.
    Restoring the Gulf to its condition just before the oil 
spill would certainly improve the environment, but it is not 
enough. Our goal here should not be to simply maintain an 
already degraded environment. We believe the country must aim 
higher, and that the region deserves better. That's why we have 
recommended that the Federal Government, working closely with 
the Gulf states, make a renewed and national commitment to the 
Gulf of Mexico and its natural resources.
    Currently, no funding source exists to support 
comprehensive regional restoration efforts. Estimates of the 
cost of Gulf restoration vary widely. But according to 
testimony before the Commission, fully restoring the Gulf will 
require $15 billion to $20 billion, or a minimum of $500 
million per year over 30 years.
    The litigation process related to the Deepwater Horizon 
spill is likely to generate at least some of the needed 
funding. But congressional action would be required to ensure 
that those funds reach the Gulf. The Commission recommends that 
80 percent of any Clean Water Act penalties and fines be 
directed to Gulf restoration. Should Clean Water Act penalties 
not be redirected to the Gulf, Congress should consider other 
mechanisms for a dedicated funding stream not subject to annual 
appropriations.
    The Commission also recommends that Congress create an 
effective state/Federal authority to administer Gulf ecosystem 
restoration policy. This council should implement a restoration 
strategy for the region that is compatible with existing state 
restoration goals. If funding is to be efficiently directed at 
long-term ecosystem restoration, a decision-making body should 
see that binding priorities are set, and funding criteria are 
adhered to.
    Congress should also ensure that the priorities and 
decisions of that council are informed by input from a citizens 
advisory council that represents diverse stakeholders, and that 
restoration decisions are rooted in sound science.
    While coastal restoration is critical, we must also devote 
greater attention to the marine environment. Scientists have 
emerged from this incident with more precise questions to 
investigate, as well as a better sense of the monitoring needs 
in the Gulf of Mexico which, because of its multiple uses and 
economic value, should be a national priority.
    The Commission recommends that, as part of management and 
restoration efforts, greater attention should be given to new 
tools for managing ocean resources that have the potential to 
improve overall efficiency and reduce conflicts among ocean 
users.
    This country's need for oil will continue for the 
foreseeable future. The simple truth is that the bulk of new 
finds are offshore and in the deep water of the Gulf. We simply 
cannot walk away from these resources, even as we remain 
cognizant of the very real risk. And because we know that 
drilling will continue in the Gulf, it is vital that we take 
this opportunity to invest in this valuable ecosystem, and undo 
past damage, and improve its resiliency.
    Mr. Chairman, thank you very much.
    Mr. LoBiondo. Thank you, Mr. Garcia. We are now going to go 
to Admiral Thad Allen. And, Admiral Allen, I want to take the 
opportunity to publicly thank you for your service to our 
country.
    Very few people in our Nation's history have been called 
upon to do what you have been called upon to do: one of the 
largest disasters in the form of a hurricane with Katrina that 
you were called in to, to oversee putting the pieces back 
together, and got extremely high marks across the board; 
commandant of the Coast Guard at a very critical time, when the 
Coast Guard needed exceptional leadership, and you went above 
and beyond the call with that; and then certainly the issue 
that we're here with today, one of the disasters that our 
Nation could never imagine it would deal with, and you were 
asked and you responded to serve your country.
    We owe you a great debt of gratitude, and we thank you for 
being here today.
    Admiral Allen. Thank you very much, Mr. Chairman. And 
Chairman Gibbs, Ranking Member Larsen, Ranking Member Bishop, 
thanks for having me here today, and thanks for the opportunity 
to speak.
    I have a longer statement for the record, and I will limit 
my remarks here this morning.
    A couple of caveats before I begin, if I could. As the 
subcommittee is aware, I am no longer in public service, having 
retired from the Coast Guard on 1 July 2011, and having 
departed government service as a senior executive on 1 October. 
Accordingly, my association with spill response and recovery 
activities, current legislation and regulatory reviews, and 
policy discussions regarding offshore oil and gas development 
has been limited to information pretty much contained in the 
public realm.
    I have been assisted by the Coast Guard in information that 
has been held regarding my duties as a national incident 
commander, but that assistance has been guided by the Anti-
Lobbying Act, and has been complied with fully.
    I am currently employed as a part-time senior fellow at 
Rand Corporation, and am teaching at George Washington 
University. In my capacity here today I am representing myself 
only, and none of those entities.
    I have reviewed the findings of the Commission. I commend 
the Commission for the detailed work and their rigor by which 
they went about their business. I would say that there are a 
number of other inquiries, as was noted by Ranking Member 
Rahall earlier on, that are in progress, including the joint 
investigation by the Department of Interior and the Coast 
Guard, and other inquiries being done by the Department of 
Justice.
    I realize there will be attention between wanting to act on 
what the Commission has reported, but I think there is 
information that will be developed in those inquiries that 
somehow should be taken into consideration, even if there are 
two phases associated with this. And I would commend to both 
committees it is my personal recommendation that the 
subcommittees take advantage of these additional investigative 
efforts to be included in any legislation that may be 
considered, going forward.
    For the purposes of my testimony here today I would like to 
focus on eight areas. There will be a Federal on-scene 
commander's report that will be coming out, as well. I am 
trying to focus on issues that were related to my 
responsibilities as national incident commander, which only 
comes about when there is a spill of national significance, and 
where we need to focus, moving forward, to make sure that we 
have an effective way to do that, if it's needed in the future.
    The first is oil spill governance and the role of the 
national response team. Throughout the entire response, even 
before I assume my duties as a national incident commander, 
there was significant misunderstanding about what the national 
contingency plan is and what it does. A lot of that was 
juxtaposed against the statutory underpinnings of the Stafford 
Act, and what is done pursuant to an emergency declaration, 
especially in relation to state and local governments and their 
authorities and jurisdictions.
    I think we need to have an open, frank conversation, moving 
forward, about what that means. And in the future, I think it's 
undeniable that we will have to have greater participation at 
the state and local level regarding our area contingency 
planning process, and our oil spill exercising process.
    Spills of national significance in the national incident 
command. I believe, going forward, we need to consider having a 
presidential declaration when these things are occurring. And 
then, subsequent to that declaration, a number of things that 
could kick in that would be automatic authorities would not 
have to be sought during the actual event, itself. And these 
would be things like giving an authority the jurisdiction to 
act under the Clean Water Act and the national incident 
commander, the authority to reduce stand-by requirements for 
response equipment elsewhere in the country, and make that 
available, should we need it in some other part of the country.
    There has already been some comments made about oil spill 
preparedness and research and development. Members, I can tell 
you, as the national incident commander, the very worst time to 
do oil spill R&D is in the middle of an oil spill.
    And the atrophy of the R&D system following the passage of 
the Oil Pollution Act of 1990 and the inter-agency forum that 
was set up to do that is something we really need to seriously 
look at, and I highly commend the recommendations to establish 
a recurring stream of fund, and to make sure we have a robust 
search--I mean rescue--sorry, research and development program, 
moving forward. We did not make consequential progress beyond 
burning, skimming, and dispersant use from the legislation that 
was passed after the Exxon Valdez.
    There has been talk about the oil spill liability trust 
fund. Obviously, we have to take a look at the overall limit, 
what could be funded out of the oil spill liability trust fund, 
which currently stands at $1 billion. That needs to be 
seriously looked at, because there is a limiting factor on what 
the government could do if there was no responsible party that 
had the deep pockets that BP did.
    Inter-agency coordination was key. My goal, as the national 
incident commander, was to create unity of effort. I think we 
need to seriously look at the role of the national response 
team, moving forward, and how they are employed. We established 
an inter-agency solutions group at the national incident 
command to handle unique challenges that were presented to us, 
like the flow rate problem. I think, in the future, that needs 
to be institutionalized in the national response team, and made 
part of the national contingency plan doctrine, moving forward.
    Regarding the international offers of assistance, as was 
previously stated, we accepted every reasonable offer of 
assistance from foreign countries. And regarding the 
application of the Jones Act, there was no impact of the Jones 
Act on this response. There were seven waivers that were 
requested for foreign vessels that were never utilized, and 
those waivers were requested in the event that heavy weather 
would require us to bring those foreign flag vessels inside 
state waters. That was done as a contingency, but never 
utilized. So the Jones Act, as was stated, was not a factor.
    Two final issues. One, air space coordination. We took a 
lesson learned from Haiti when we took control of the air space 
to control the landing slots. Partially through the response, 
we took control of the air space in the Gulf and it 
substantially improved our performance. Had I to do it over 
again, I would have done that on the first day.
    And I would be glad to answer any questions you may have 
for me regarding the implication of these lessons for future 
operations in the Arctic. And I thank the chairman for inviting 
me here today. Thank you.
    Mr. LoBiondo. Thank you, Admiral Allen. I am going to start 
off by yielding my time to Mr. Young.
    Mr. Young. Thank you, Mr. Chairman. I thank the panel. I 
especially thank the admiral.
    In the aftermath of--the Deepwater Horizon spill response 
was purely inadequate. But I say it was also inadequate with 
the Exxon Valdez spill, and we learned from that spill. I am 
not real excited about the Commission's recommendations. And I 
do thank you, Admiral, for saying maybe we ought to look at the 
rest of it, because it doesn't give us the answer to why the 
explosion occurred, the Deepwater Horizon.
    And I think that's what we ought to address, what human 
factors were involved, and was there a mechanical, was there a 
criminal action. And until we find that out, I don't believe we 
should rush into write any legislation.
    Actually, what we came--after the Valdez it was for 
harbors. We had no protection for harbors until we had Exxon 
Valdez. It worked. But it wasn't good in the deepwater area.
    BioMar says they're going to require response capability of 
400 percent of worst case scenario discharge, yet they're asked 
how they are going to insure it, the plan to actually meet that 
goal, and they say, ``That's not our job. We're not boat 
people.''
    And then, the Coast Guard--all due respect, Admiral, you're 
no longer with them--says, ``That's not our job. Our job is not 
to say how much oil gets picked up, or how it gets picked up. 
Our job is to ensure that whatever method is employed is 
safe.''
    As you can see, there is a gap, a regulatory gap. And, as a 
result, the industry is left to police itself, the very thing 
that every report has concluded is a major part of the problem 
of Deepwater Horizon. Some are proposing to have the American 
Bureau of Shipping fill that gap. ABS already does work for 
both agencies--as you know, Admiral--and it has expertise in 
evaluating the specifications and maintenance of the equipment 
and plan.
    What would you think about the ABS taking over that 
program? Either one or all of you. I don't care. Admiral?
    Admiral Allen. Well, I'll take a stab at that. First of 
all, I think it's clear and unequivocal there needs to be 
third-party inspection of drilling systems. We shouldn't be 
left to industry standards. And that can be done by a variety 
of institutions. ABS does have a process whereby they drill 
that--I'm sorry, inspect that--and then review the plans.
    Several components of these drilling systems have to be the 
subject, in my view, of third-party investigations: the 
preventers, blue and yellow control pods, and the choke and the 
kill lines, at a minimum. And I think this is something that 
needs to be done.
    Mr. Young. But right now it's not being done. So we could 
do that. We could set that up, where there is a----
    Admiral Allen. Right now there is a----
    Mr. Young. Frankly, Admiral, I don't want the government to 
do it right now.
    Admiral Allen. Right now there is a certification industry 
standard, sir.
    Mr. Young. Let's get somebody--you guys agree with that?
    Mr. Boesch. Yes, that's consistent with our 
recommendations.
    Mr. Young. OK, I'm glad to hear that, because that's one of 
our biggest problems.
    Last summer's spill in the Gulf of Mexico reminded us of 
the risks associated--there are risks, by the way. This is the 
first blow-out we had in deep water, I believe--42,000 wells 
drilled in shallow wells and how many drilled in deep water? 
This is the first blow-out we had. It was unexpected. And we 
did not have the capability to do it.
    But there was--in Mexico there was a number of vessels 
nearby to assist in recovery and clean-up immediately. What 
steps has the industry taken to mitigate the risks and effects 
of a spill in rural areas of the Arctic? See, I'm from the 
Arctic, guys. I want to drill in the Arctic. And your report is 
not too enthusiastic on that.
    And I heard some comments of the admiral--I'm not 
enthusiastic about that, either--like, ``We can't do it until 
we have proper ice breakers, et cetera.'' And, by the way, 
Admiral, we're not going to get the ice breakers out of this 
Congress. I helped build those three, and we got two in dry 
dock right now are not working, and you're not going to get any 
more ice breakers. We do it, we can have them leased, as they 
should be, at a cheaper rate--I've been pushing that for a long 
time--than buying them, because we're not going to get the 
money for it. And we do need them in the Arctic.
    But what steps have been taken by the industry, like Shell, 
et cetera, in the Arctic that actually--it's different than the 
Gulf--to work on it? Is there any steps that you know of?
    Mr. Garcia. Yes, Congressman Young. We do address the 
Arctic in the report, and we do indicate in our report that 
drilling can be done in the Arctic. We are suggesting that 
there are certain steps that should obviously be taken before 
drilling commences. You've noted most of them, which is that 
industry should demonstrate it has the capacity to respond and 
to contain a blow-out.
    There are clear differences in the Arctic from the Gulf. 
It's shallower water, it's much deeper in the Gulf. But we were 
concerned about the government's and the industry's ability to 
respond. If they can show that they have the capability of 
adequately overseeing and responding to a spill, then drilling 
may commence.
    Mr. Young. But my problem is it is shallower. It's low 
pressure, is that correct?
    Mr. Garcia. Yes.
    Mr. Young. So we--the chance of blow-outs are minimum, 
and--because I don't believe we have ever had one in the 
Arctic, anywhere. Now, maybe over--now I have Iceland drilling 
now, I have China drilling now, I've got--I believe Russia is 
drilling now. Greenland is drilling now. Everybody is drilling 
in the Arctic but us.
    And I want to suggest respectfully that--Mr. Chairman, if 
we keep delaying this action, we're doing this country a 
disservice, because they have done the job. As far as I can 
tell--and I've reviewed their reports--now, we don't have the 
ice breaker. We've got the Healy, which is on its last legs.
    We need to figure out what can be done in the Arctic. It 
may be easier to clean up in the Arctic if there was a spill, 
because it's a much colder climate. And I don't want to keep 
saying no, no, no, because it's not failsafe. You said that, 
Mr. Garcia.
    Mr. Garcia. Yes.
    Mr. Young. Is there----
    Mr. Garcia. Sir----
    Mr. Young. Yes, go ahead.
    Mr. Garcia. I agree. There are clear differences. But also, 
as you know, in the Arctic there are challenges. The remoteness 
of certain areas, the ability to stage equipment and personnel, 
as well as the fact that--weather factors, ice, darkness 
throughout much of the year. So all of that has to be factored 
in. But nothing in our report has suggested that we should not 
be drilling in the Arctic. We are only saying that the lessons 
that we learned from this incident should be incorporated into 
any decisions to move forward.
    I would also--if I could just add one other thing, the 
report--and I just commend it to the record and to your 
reading--but the report does address the root causes and the 
immediate causes of the blow-out, and our chief counsel is also 
coming out with a report next week that will be highly 
detailed, going through each of the factors that caused the 
blow-out of the Macondo well.
    Mr. Young. Well, that may be, but I know I've checked the 
background of every one of the Commission, and their support in 
the past, and I want you to know that. And I am --some got 
critical. We had two people before the Natural Resources 
Committee, and I did chew on them a little bit. I haven't 
chewed on you.
    Mr. Garcia. And I appreciate that.
    Mr. Young. I might. I might. I just think there is a pre-
thinking process, and--for offshore drilling.
    And, gentlemen, we have a problem in this country. As you 
mentioned, we're not going to get off this kick for oil. There 
is no way for a long, long period of time.
    And I have--as you know, you talk about an economical 
disaster in the Gulf. Really, it's because of the moratorium. 
That's been the biggest hardship, other than the oil. The lack 
of work. It's been lost--we're buying that oil from Venezuela. 
Now all the ships that I know of are going down to Brazil. And 
we, as a Nation, have to do where the oil is. We have to do it 
and do it correctly.
    Thank you, Mr. Chairman. I appreciate it.
    Mr. LoBiondo. Thank you, Mr. Young. Mr. Larsen.
    Mr. Larsen. Thank you, Mr. Chairman. Just like to recommend 
that we get Representative Young maybe some bear meat he can 
chew on, and leave the folks alone that are testifying.
    Mr. Young. You know me.
    [Laughter.]
    Mr. Larsen. I want to thank the folks for testifying. I 
also want to be sure I thank the employees at the BP refinery 
in Cherry Point Ferndale, the Coast Guard and Federal employees 
out of the Coast Guard from district 13, and those from EPA, 
the Federal employees from EPA region 10 out of Seattle for 
being willing to take an assignment to go down to the Gulf and 
help with response and clean-up during the response over the 
summer, before we get started. Working side by side and hand in 
hand, everybody pulling on the same oar last summer.
    I have some questions with regards to something in my 
opening statement, and that's about the costs and the budget. 
And first off, for Admiral Allen, you know, this Congress is 
exploring some fairly deep cuts to discretionary spending. Even 
assuming that the Coast Guard funding remains constant, there 
are recommended investments that would take funds from other 
Coast Guard accounts.
    In your--based on your experience with the Coast Guard, 
would that allow the Coast Guard to still adequately perform 
its existing missions, if we were to follow through on some of 
the things we're looking at right now in congress?
    Admiral Allen. Well, sir, as you rightly pointed out, I'm 
not the commandant right now. So any comments I had would be 
reflective on the experience I had in the last couple budget 
years moving forward. And I would just say, as a general 
statement, you get faced with a choice in any constrained 
budget environment about what you're going to do with capital 
investment and replacing your aging assets. If you don't do 
that, you create a hollow force that collapses on itself.
    I made some very difficult decisions, as commandant, to 
make sure I sustained, to the extent it was possible, 
acquisition funding to keep building our cutters, because we 
need those desperately. If you're going to do that in a 
constrained budget environment, then you're going to have to 
look at your operating accounts as an offset to do that.
    What is needed is a frank, open conversation about the 
inherent opportunity costs of doing that. I talked last year in 
the budget development inside the administration about risks 
associated operations to be able to make capital investment. 
There is nothing wrong with talking about that, you just need 
to have a frank, open conversation and be clear about what it 
is you're trading off.
    But I think we have a real hesitance and reluctance to talk 
about those things, and when they're actual realties that we 
have to deal with in the budget. So my decisions, as it related 
to budget, reflected my need to build Coast Guard cutters. And 
if that was at the expense of some operating expenses, then you 
take a short-term position when you're going to have to manage 
with fewer resources to make sure you ensure the long-term 
viability of the service.
    Mr. Larsen. Thanks. And I know that current Admiral Papp 
has made some comments recently about the budget environment in 
the Coast Guard currently, and about what might have to occur 
there at the Coast Guard coming in to the future.
    For Mr. Garcia and Mr. Boesch, did--does the report--did 
you look at the amount of the investments that would be needed 
to implement your recommendations, but for the 80 percent of 
the----
    Mr. Boesch. Our staff has done a general appraisal. We're 
obviously not in a position to cost out each of the activities 
that we recommend, in terms of improving the review and 
regulatory capacity in the Department of the Interior, 
including the studies and the like.
    But in a general estimation, just to put it in a context 
that we can understand, I think, our estimate is that it might 
induce a cost of somewhere between 7 and 12 cents on a barrel 
of oil that's produced. And you put it into terms of a gallon 
of gasoline, it's less than a quarter of a cent per gallon of 
gasoline.
    And we recommended that these fees not be recovered from 
the general taxpayers, who are the landowners in this case and 
are being paid by the oil companies for the right of exploiting 
the land and the resources, but by the industry itself, much as 
the Federal Communications Commission is funded by that 
industry.
    So, we think that this can be done in a cost-effective way 
that would actually increase the efficiency of regulation. 
Right now there are not enough folks to review the permits 
under these new standards. But also, do it in a way that 
doesn't affect the Federal tax situation and our own fiscal 
health in this Nation, but also a very modest cost, which is 
easily affordable for the industry.
    Mr. Larsen. Admiral Allen, I only have a few seconds. I 
will ask the question with the chairman's indulgence, and 
perhaps have an answer.
    In your report and testimony, you discuss the initial 
difficulties of working with certain--well, with state and 
local officials, perhaps because of the difference between how 
people approach a natural disaster versus a disaster like we 
see in the Gulf. Did you have specific recommendations that you 
think we ought to be looking at, with regards to the Stafford 
Act, or any other legislation?
    Admiral Allen. I do. First of all, the area of contingency 
plans that identify sensitive areas and how they will be 
protected have been developed over the last 20 years, after the 
revisions made from the Oil Pollution Act of 1990. I think it's 
absolutely essential that we get state and local governments 
more involved in that. Heretofore, those agreements have been 
made with the states representing the counties or the parishes.
    It was clear during this bill that the determinations that 
were made and the priorities established in that planning 
process were not understood by the local leaders in the areas 
that were impacted. I can see no other way of moving forward to 
solve that problem than to bring them in to the process, and 
make sure they are consulted and have a role in it.
    Mr. Larsen. OK. Thank you. Thank you, Mr. Chairman.
    Mr. LoBiondo. OK, thank you. Mr. Gibbs.
    Mr. Gibbs. Thank you, Mr. Chairman. First of all, I wanted 
to thank Admiral Allen for his service to our country, and 
appreciation of all he's done. Your eight points for response 
coordination, I think that's something we should look at.
    My first question that I wanted to address to the other two 
witnesses, in your oral testimony you talked a lot about 
ecosystem restoration. And obviously, that's important. But I 
noticed in your oral testimony you didn't mention what was the 
root cause of the disaster. Now, in your written report, you 
do. The Commission talks about several key human errors, 
engineering mistakes, and management failures.
    Specifically, there was flaw design in the cement to seal 
the bottom of the well. A negative pressure test was conducted 
that identified the cementing was a failure. Flawed procedures 
in securing the well with the mud, and getting the mud out of 
the well door--apparent inattention by key initial signals for 
an impending blow-out. And so it was obviously human errors; 
management and engineering errors. You say that in your report.
    Now, where I come from, we in Ohio don't have deepwater 
drilling. But I know in instances--my experience in the Ohio 
legislature--we have had problems. A lot of that was similar 
problems, somebody didn't do the right thing. And what's really 
been bothering me is when you think of all the challenges in 
deepwater drilling and the technical challenges and all that, 
and the amount of investment and all, compared to just drilling 
a normal well in Ohio.
    What is the function of the regulatory person? In one part 
of the report it talks about creating a new regulatory 
structure. Before I would want to support that, I need to know, 
on a deal like that, there is no regulatory person on these 
rigs, or--what's the oversight? Can you expound on that a 
little bit?
    Mr. Garcia. Sure. The--thank you for the question, 
Congressman.
    One of the findings of the Commission was that there was a 
failure of oversight. There was a serious failure. You had an 
agency that had an inherent conflict. Individuals who were 
responsible for overseeing safety were also involved in the 
collection of royalties and making leasing decisions. We've 
suggested that we need to separate those functions, and the 
Department of Interior is moving in that direction. We think 
that they should probably go much further. So we've suggested 
removing it from the political process within the Interior 
Department.
    Inspectors from MMS did go out and visit rigs. But clearly, 
the oversight was inadequate. And we have made a number of 
recommendations on how the government can be more effective, as 
well as how the industry can be more effective in monitoring 
its activities and policing itself, rather than having the 
government be solely responsible for that.
    Mr. Gibbs. OK. So I see independent agency--that's your 
response for that, because you think for regulation----
    Mr. Garcia. Well, independent agency within the new BOEMRE, 
however they pronounce their new acronym.
    But also we have suggested that the industry follow the 
example of the nuclear industry, and set up an industry 
watchdog that would police its members, would set standards of 
excellence, so that an outlier would not be able to impact the 
entire industry, as happened in this case.
    Mr. Gibbs. OK. And my last question, Mr. Chairman, dealing 
with the Commission's reasons why state and local authorities 
were not more involved in spill planning. And I think that 
would probably go to all three, with the recommendations on how 
the Coast Guard can be more effective working with local 
authorities for a response.
    Admiral Allen. I don't think there is any disagreement 
between the Commission's finding and at least where I stand as 
the national incident commander, that if you're going to have 
an effective local response, the local political leaders can't 
feel they're disenfranchised and didn't have a say in the 
priority.
    There was an assumption made that when we approved the area 
contingency plans with the state representatives, that they 
reflected the representation of the state and the local 
governments. That was not the case, especially in Louisiana. 
And I think, moving forward, there has to be visibility of 
what's going to be protected, and how it will be protected, the 
tactics, including exercises in preparedness, that must involve 
local governments.
    Mr. Garcia. I would just add that we heard a lot about 
this. I traveled throughout the Gulf, as did Dr. Boesch. 
Clearly, a better job needs to be done of bringing elected 
state and local officials into the planning process, so they 
understand what's happening. And so that was one of the 
disconnects in this incident.
    Mr. Gibbs. Thank you.
    Mr. LoBiondo. Thank you. Mr. Bishop.
    Mr. Bishop. Thank you very much, Mr. Chairman, and thank 
you all for your testimony. And, Admiral Allen, thank you for 
your service. It's nice to see you again.
    I want to focus in on the issue of financial liability, 
because I believe this is an area that the Deepwater Horizon 
disaster clearly demonstrates where our current law is 
insufficient. Current liability limits for deepwater drilling 
are--the responsible parties responsible for the cost of the 
clean-up and the removal, 100 percent of that, and then for $75 
million of other costs. That's the cap. Now, thankfully, and 
responsibly, BP has indicated that they will not be constrained 
by that cap.
    The legislation that we passed last summer, the CLEAR Act, 
had completely eliminated a cap. There was no cap that the 
responsible party would be responsible for all costs associated 
with the spill. The Commission has recommended an increase in 
the liability cap, but without specifying it.
    So, my question is, how exposed are we? What are the 
consequences of our continued failure not to have passed 
legislation that addresses just that one narrow issue? Dr. 
Boesch?
    Mr. Boesch. Well, there is pretty substantial exposure, 
because if an incident like this, or even much less than this, 
occurred, and the party didn't have the deep pockets of BP, and 
did make the commitments that BP has, we would have been in a 
difficult situation.
    The Commission recommended raising the cap. The need to do 
this is clear from what had gone on. We did not recommend 
unlimited liability, nor a specific amount, because this 
requires more analysis than we were able to do within the remit 
that we had: specifically, the issues of insurance, and how 
that insurance market would work; and secondly, as Mr. Landry 
had pointed out, there are some smaller companies that are 
involved in this industry, and we didn't want to, by making a 
recommendation without further analysis, exclude the 
participation of those companies in this industry.
    Mr. Bishop. Understood. Admiral Allen, you have indicated--
I don't want to put words in your mouth, but I believe you have 
indicated that we should take somewhat of a go-slow approach 
with respect to legislation, wait until we have all of the 
reports in hand, and so on.
    But in this area of liability cap, isn't it fair to 
conclude that we already know that the current liability cap is 
insufficient, given the enormity of the tragedy in the Gulf, 
and that at least that one area is an area that really demands 
that we move much more quickly?
    Admiral Allen. I think you can separate out what we know to 
a certainty needs to be fixed right now, and what we need to 
know from the detailed investigations and forensics that are 
going on right now with the joint investigative team. I don't 
know how that translates to the agenda that you have regarding 
legislation, but there obviously is attention here. I think we 
just need to recognize that it exists, and what is the best way 
to move forward.
    I don't think there is any issue regarding the liability 
cap and the total overall amount that could be spent on a 
response. I think the question is finding that right amount and 
the balance between the impact on the insurance industry and 
the small operators in the Gulf that Mr. Landry represents, and 
others. I think there needs to be some serious research done in 
that regard, and what the impacts would be on that liability.
    We did have a case in the Delaware River several years ago 
in LoBiondo's area, where we had a vessel ran against an object 
in Delaware Bay. We had a significant spill. They reached the 
limits of liability, and basically the company walked and the 
government was insured. So, I think we need to go back and take 
a look and understand what's going on.
    And I would make one other comment. Under the Oil Pollution 
Act of 1990 we required certificates of financial 
responsibility for vessels that are entering the U.S. waters 
carrying crude oil. There was a lot of talk at the time that 
that might have a significant negative impact on the tanker 
business. It did not. They adjusted, and we moved forward.
    Mr. Bishop. Thank you. I--just to put a--you know, make the 
point even more pronounced, Mr. Garcia, your testimony was that 
fully restoring the Gulf will require, over the next 30 years, 
at least an expenditure of $15 billion to $20 billion, if we 
have the existing cap in place, and the responsible party is 
not being as responsible as BP is doing. That amount would very 
quickly dwarf the amount of money available in the oil spill 
liability trust fund, and so either the work would remain 
undone or it would revert to the taxpayers to take on that 
obligation. Is that right?
    Mr. Garcia. Well, actually, what we're recommending is that 
the penalties under the Clean Water Act, which are separate 
from the natural resource damages--and those penalties could be 
substantial; they're based on the amount of oil that is spilled 
into the water per day----
    Mr. Bishop. And those remain to be calculated, correct?
    Mr. Garcia. Those remain to be calculated. But whatever 
amount should be directed--80 percent should be directed to the 
Gulf. Congress will need to take action to allow that to 
happen. Because if you don't, those funds would then revert to 
the treasury.
    And so, what we're suggesting is that Congress authorize 
that 80 percent of the Clean Water Act penalties from this 
incident be directed to the Gulf for restoration.
    Mr. Bishop. A, that would require legislation.
    Mr. Garcia. Yes.
    Mr. Bishop. And--thank you, Mr. Chairman. I will yield 
back.
    Mr. LoBiondo. Thank you, Mr. Bishop. Mr. Cravaack?
    Mr. Cravaack. Thank you, Mr. Chairman. One of the things 
I'm concerned about is chain of command failure and breakdown. 
One of the things that I was concerned about when I was reading 
about this up in Minnesota, one of the things--I saw a governor 
enlisting 16 barges, trying to save his shoreline--I will be 
gentle--and they were shut down by the Coast Guard.
    Admiral, I would like to know who made that command? Who 
shut those barges down?
    Admiral Allen. I'm not sure I know the specific incident, 
but it might have to do with the barges that were used as a 
protection----
    Mr. Cravaack. Skimmers.
    Admiral Allen [continuing]. And harbors that were moved 
with incoming predicted weather associated with a potential 
hurricane.
    The Coast Guard has overriding jurisdiction regarding the 
safety of Federal waterways, and this is separate from oil 
spill responsibilities. With hurricanes approaching, decisions 
had to be made about----
    Mr. Cravaack. This wasn't for hurricanes, sir. It was 
because they didn't have fire extinguishers on board. Or they 
were checking--not they didn't have them.
    Admiral Allen. Oh, I understand now. I was trying to figure 
out which barges you were talking about.
    Mr. Cravaack. OK.
    Admiral Allen. What the state did is they brought in 
barges, put vacuum trucks on the barges, and took the barges 
out, and were going to try and skim oil with it. We were trying 
to make sure that when they went out there, there wasn't a 
maritime accident associated with the fact that you don't 
normally put skimming trucks on barges and use that as an oil 
spill response capability.
    The company operators were completely supportive of making 
sure the inspections were done correctly and they were safe to 
operate before they did that. The state did not understand why 
we were holding them up, but there was an overriding safety 
need on those particular barges that you're talking about, sir.
    Mr. Cravaack. Would you agree, sir, this was an extremist 
situation the governor was trying to work in?
    Admiral Allen. I believe that you don't complicate a 
problem by putting people's lives at risk in the middle of the 
response, sir.
    Mr. Cravaack. Would you agree it was an extremist 
situation, sir?
    Admiral Allen. It was an extremist situation, but I would 
not put people's lives at risk, and that's what we were looking 
at, sir.
    Mr. Cravaack. OK. In the--BP Deepwater Horizon oil spill 
was the first spill designated as a spill of national 
significance. Admiral Allen was the first national incident 
commander. The national contingency plan does little to define 
the roles of authority of the national incident commander, or 
the additional resources and procedures necessary to mitigate a 
spill of national significance.
    What changes--and I can ask all of you--what changes to the 
national contingency plan are necessary to better define the 
authority and chain of command responsibilities during the 
spill of national significance?
    Mr. Boesch. We didn't get into the specifics of all of 
that, other than to indicate that, obviously, there was not 
sufficient forethought and definition of the complexities of 
dealing with a spill of national significance.
    Admiral Allen will note it in his written testimony that 
there had been plans for an exercise that would engage the 
government on a spill of national significance that took place 
just a month before the incident. And there was not an adequate 
involvement of the appropriate officers at the right level in 
government to get learning from that experience.
    So, it's not only the question of having the criteria that 
would move it to that level of response, but also making sure 
that the government is evergreen, is ready to actually exercise 
and perform under those capacities in an incident which could 
occur once every decade or so.
    Mr. Garcia. As I mentioned a moment ago, one of the big 
problems was the failure to involve in the planning process 
state and elected officials who clearly need to be involved in 
and understand the procedure when you have a spill of national 
significance. And we have recommended that steps be taken to 
make sure that all levels of government are familiar with it.
    I would say, though, that the professional career oil spill 
experts and responders at both state and Federal levels were 
fully trained in responding. It's just that many of them had to 
be moved aside, because this thing was so big that elected 
state and local officials understandably wanted to be and had 
to be involved.
    Mr. Cravaack. I understand. One of the--I'm sorry, sir. Go 
ahead.
    Admiral Allen. I think you were specifically asking about 
the national incident commander and the authorities that might 
be needed. Currently, the protocol calls that the commandant 
would designate a national incident commander. And it was 
previously understood that would be one of our two or three-
star area commanders, either Atlantic or Pacific. We were in 
the process of a succession change in the Coast Guard, and I 
was designated.
    First of all, I think the national incident commander 
should be presidentially designated. I think there ought to be 
a standing delegation of clean water authorities, once that 
designation is made, and that that commander should have the 
authority to redirect assets nationally, and drop stand-by 
requirements to move response equipment where it's needed, sir.
    Mr. Cravaack. Thank you, sir. And I am out of time, sir. I 
yield back.
    Mr. LoBiondo. Thank you. Mr. Cohen.
    Mr. Cohen. Thank you, Mr. Chairman. Let me ask a question 
here. Admiral Allen, I guess, might be the appropriate party.
    The vessel was flagged by--under rules in the Marshall 
Islands, I guess, was it--the Marshall Islands. And they have 
different standards than we have. Do you believe that that 
was--that we should have all of these vessels under United 
States safety regulations, and flagged by the United States 
standards?
    Admiral Allen. Sir, I would submit to you there is an 
effect that we need to achieve, and it is this. Right now, for 
those vessels to operate in our waters, they have to be 
compliant with international standards that have been 
promulgated through the International Maritime Organization. To 
do that, the Coast Guard does a verification of whether or not 
the country of registry has met those international standards, 
and issues what's called a certificate of compliance, where we 
would normally, for a U.S. flag ship, issue a certificate of 
inspection.
    I would submit that we need to take a look at the protocol 
that we use for cruise ships that are foreign flagged that 
carry a large number of U.S. passengers, and we do something 
called a control verification exam, which actually involves a 
physical inspection. There are two ways going forward. You can 
have the discussion whether they should be U.S. flagged or not, 
but they certainly should be held to a higher standard, and 
inspected. And I would say that the current regime we use to 
insure the safety of cruise ships is a good model to use for 
offshore drilling units.
    Mr. Cohen. The Marshall Islands was the standards, and I 
think they had somebody perform the safety standards that was 
from that area, and it was like a four to eight-hour 
examination, if I'm correct. If I'm wrong, correct my premise. 
But is that accurate? That was----
    Admiral Allen. I'm not sure what you're referring to, sir. 
But what we would do with a cruise ship, there would be an 
extensive inspection while that ship was being built in the 
shipyard. There would be initial exam when it entered into 
service, and there would be quarterly inspections.
    I have taken a part in those myself, as a field commander. 
I think that type of regime should be applied to foreign flag 
vessels operating in our waters, sir.
    Mr. Cohen. You mentioned, I think in response to Mr. 
Young's questions--and it might have been Mr. Garcia, I'm not 
sure, but somebody--that the government should not be the one 
that determines these standards. Is that what I understood? 
What was it?
    Mr. Garcia, it was something Mr. Young asked about, and he 
didn't think the government should be the party, there should 
be a third party doing this--I think it was the safety 
inspections, and I think you----
    Admiral Allen. I think what he was referring to was 
certification of drilling systems. Right now, let's take a 
blow-out preventer. That is built by industry to certain 
standards that are issued by the American Petroleum Institute, 
and that constitutes the level of due diligence that's applied 
to the construction and operation.
    I think what we're saying is, as with vessel inspection, an 
independent third party such as American Bureau of Shipping or 
other classification societies, should be the ones that come in 
and verify especially blow-out preventers, killing choke lines, 
and the blue and yellow pods on these operations.
    Mr. Cohen. All right, that's--thank you for refreshing my 
recollection.
    But let me ask you this. Do you think that--are there 
systems that make sure that there is not influences there that 
would make those standards more to the industry's liking, 
rather than maybe the public's needs?
    And government--it's a bad rap, and government can and have 
proper regulations and proper oversight. That's one of the 
issues in this Congress, is about regulation and regulation 
hurting the government, or hurting business. And yet there is a 
lot of regulations here that need to be adopted and 
implemented.
    And these might cost--I don't know, what--there is 
something about the Raines Act, $100 million, and whether or 
not this would be determined as $100 million. I imagine it 
would. And if you couldn't get the Senate to go along with what 
the House had in some regulation on standards, we would have no 
standards.
    Admiral Allen. Yes, sir. If I could make a comment, there 
is an issue that was raised in the Commission report. It hasn't 
been alluded to in this hearing yet today, but it probably 
needs to be discussed.
    If you look at the rest of the world and how they manage 
oil exploration off their coast, they do it through something 
called a safety case regime, where there is a risk assessment 
conducted. And as part of the regulatory process, the companies 
have to produce a plan on how they will mitigate risk and 
manage the overall process through a safety management system. 
That is going to be the subject, I think, of some pretty 
detailed discussion.
    My personal view is you probably need a hybrid system, 
where there is some command and control issues related to 
inspection of drilling systems, and a way to assess risk and 
have them present a plan on how they would manage risk. But the 
commissioners may want to comment on that.
    Mr. Garcia. And, in fact, that is exactly what we have 
recommended, that there be a hybrid system where--we need to 
obviously change and strengthen the regulations----
    Mr. Cohen. Let me stop you for one minute, because I've got 
12 seconds before a red light goes off, and then you can go on.
    If we had some--passed this Raines Act, and you had 
regulations from the government that couldn't go into effect 
unless the House and Senate approved them, you could have a 
disastrous oil spill, because we don't have regulations. And 
how much would that cost business in the Gulf: fisheries, 
tourism, et cetera? Would the lack of ability to promulgate and 
enforce rules and regulations cost business a lot of money?
    Mr. Garcia. Yes, sir. It would cost business a lot of 
money.
    Mr. Cohen. Great answer.
    Mr. Garcia. If I could just answer one of your other 
points, we did recommend a hybrid system. The regulations that 
are governing the oversight of the offshore industry by the 
Department of the Interior need to be strengthened. They need 
to be brought into the 21st century, frankly. We should be 
setting the standard for the world.
    But we also suggested that we need to follow the lead of 
the United Kingdom and Norway, who had their own catastrophic 
events. And, following those events, they instituted a system 
that is called a safety case approach. And what that requires 
is that the operator and the driller must demonstrate on a 
site-specific basis that they have put into place all of the 
safeguards and measures necessary to properly drill in a 
particular place.
    And then, third, we recommended that the industry--it's in 
the industry's interests that it should set up its own watchdog 
that would be of and by and for the industry, to provide 
oversight, similar to what the nuclear industry has done, and 
which has been very effective.
    Mr. Cohen. Thank you, sir. Thank you, Mr. Chairman, and 
thank you----
    Mr. LoBiondo. Thank you. We're going to try to be very 
accommodating in this committee. But I think it's important in 
the initial session--Mr. Cohen, you pointed out a good point. 
You were in your last couple of sessions, I wasn't going to cut 
off the witnesses. But that's really not fair to the folks who 
don't squeeze in a question right at the last moment.
    And if it's really important, we will go to a second round. 
We won't cut you off if you have your questions. But I would 
just ask the Members to keep that in mind. Mr. Coble?
    Mr. Coble. Thank you, Mr. Chairman. Mr. Chairman, I've got 
a Judiciary Committee hearing going on simultaneously, so I 
missed some of the testimony. But I appreciate the contribution 
that the panel has made.
    Mr. Garcia, Mr. Boesch, let me put this question to you. 
The President's moratorium on oil and gas drilling was 
technically lifted mid-October, I think. But I'm told that 
there have been very few permits granted.
    Let me put to you all a three-part question. Did the 
Commission conclude that deepwater energy exploitation can be 
done safely? Did the Commission conclude that deepwater energy 
exploitation should continue to ensure our energy independence 
and national security? And, finally, how critical is offshore 
oil and gas drilling industry to the economy in the Gulf?
    Mr. Boesch. I think the answer to the first two questions 
is yes. The first answer is yes, it can be done safely, and it 
is important to our energy supply. And, finally, it is very 
important to the economy of the northern Gulf of Mexico.
    We did not partake in the moratorium. We didn't act on it. 
In fact, two of our co-chairs spoke that it was ill-advised to 
have a blanket moratorium. As I understand, though, the state 
of play is that in deepwater drilling, one requirement, which 
is actually in our recommendations and the Secretary of 
Interior is applying now, is the need to demonstrate, certify, 
that one has the capacity to control a blow-out if it occurs.
    I understand, from a comment made just the day before 
yesterday by the head of exploration and development of 
Chevron, that they're just days away of coming to that 
agreement, and on the basis of his comments, we anticipate that 
these permits for deepwater drilling would be granted for those 
companies that have actually met the standard pretty soon.
    Mr. Coble. I thank you, sir. Admiral, let me put a three-
part question to you, as well, but playing Monday morning 
quarterback.
    Do you believe the Department of Homeland Security's senior 
leadership was fully aware of how oil spill response is 
supposed to function under the national contingency plan? And I 
am told, Admiral, that some of the senior leadership at DHS in 
some cases failed to adhere to the plan. And did their 
misunderstandings of the process affect oil spill response 
efforts?
    Admiral Allen. Sir, let me start with a contextual comment. 
The Oil Pollution Act of 1990 and the national contingency plan 
predate the development of the Homeland Security Act, and the 
establishment of the Department of Homeland Security. The major 
incident command doctrine under which the Secretary operates is 
Homeland Security Presidential directive number five.
    From the start, we have never been able to align, 
integrate, or deconflict the role of the Secretary of Homeland 
Security and incident management across the entire country with 
the specific doctrine that's called out in the national 
contingency plan.
    The first impulse by political leaders is to go with what 
they understand and know. And, in this case, it is the role of 
the Secretary under HSPD 5. Since that was never deconflicted, 
there was never a determination of what supersedes and how 
they're integrated.
    Now, we worked that out. But one of the recommendations I 
have made and continue to make is, going forward, the 
differences in the two regimes and the authorities and the 
accountability of senior leaders needs to be resolved, sir.
    Mr. Coble. I thank you, sir. I thank you, Mr. Chairman, and 
I yield back.
    Mr. LoBiondo. OK. Mr. Larsen, you have a unanimous consent 
request?
    Mr. Larsen. Mr. Chairman, I ask unanimous consent that the 
statement of Congresswoman Johnson be entered into the record.
    Mr. LoBiondo. Without objection, so ordered.
    The gentleman from coastal Louisiana has some questions 
here.
    Mr. Landry. Yes, sir. Thank you, Mr. Chairman. On a lighter 
side, Admiral Allen, your favorite parish president, Bill 
Nungesser, told me to tell you hello today.
    [Laughter.]
    Admiral Allen. I'm feeling the love.
    Mr. Landry. I have three questions, and I would appreciate 
your keeping the answers as short as possible. They are very 
important.
    A lot has been said about the Jones Act. And my question to 
you, Admiral Allen, is do you feel that the waiver provisions 
in the Jones Act provide sufficient flexibility during 
emergencies, currently?
    Admiral Allen. Yes, they do.
    Mr. Landry. OK, great. After reviewing the Commission's 
report--and this is for you, Admiral Allen, with you gentleman, 
certainly--after reviewing the Commission's report, and based 
upon my experience in listening to people back home who have 
worked, you know, 50-plus years in the oil and gas industry, 
it's apparent that there were regulations that were already in 
place that were being supervised by MMS that seemed to have 
been violated.
    In comparison, I have not seen that there were any 
regulations that were under the purview of the Coast Guard that 
caused the accident. Would you agree with that?
    Admiral Allen. Sir, that relates directly to my earlier 
statement, that we need to understand the results of the joint 
investigation team. If you think about it, what we had was a 
vessel that was attached by a riser pipe to a well. At the 
bottom of that riser pipe was a system that was regulated by 
the Department of Interior. At the top of that riser pipe was a 
vessel that was regulated by the Coast Guard.
    Mr. Landry. Right.
    Admiral Allen. There are issues with well control.
    Mr. Landry. Right.
    Admiral Allen. There were issues with the cementing job. 
There were issues with the gas that came up. Once the gas was 
released, then you have gas enveloping a vessel that was issued 
a certificate of compliance by the Coast Guard to see that--to 
ensure they complied with international standards.
    So, what the joint investigative team is going to be doing 
is not only looking at the cause of the loss of control of the 
well, but, for instance, how did the gas that came up be 
brought into the intake systems, into the engine room and 
possibly--so you're looking at fire suppression systems and 
safety issues related to the vessel itself. So it's a much more 
complicated system, because you have a floating platform 
connected to a well, and there are jurisdictional issues at 
both ends of that.
    And that's the reason I think we need to take a very, very 
close look at everything associated with it, including the 
performance of the fire suppression systems on the vessel, 
itself.
    Mr. Landry. Well, I hope not to have to get to the fire 
suppression systems on a rig.
    My only point to you all is that I have--it seems as though 
the inspections done by the Coast Guard out on the Gulf of 
Mexico are very, very sufficient, and MMS may have missed the 
boat on this, I guess you could say--and the recommendations to 
build additional bureaucracies within the same department that 
held oversight of MMS, which is now the BOEM.
    So, I don't have a lot of confidence in BOEM. I've got a 
lot of confidence in the Coast Guard. I guess that's my point 
here.
    The last question, very quickly, the motor vessel was on 
location at the time. And of course, this incident occurred in 
the spring, when water temperatures were certainly starting to 
warm up. But the Bankston--it's not required to be at that 
platform while it's drilling. There is no regulation that 
mandates that that vessel be there. If that vessel would not 
have been there, and this would have been in the winter time, 
and the men and women who had to jump off of that facility 
would have ended up in the water, do you believe we would have 
been able to recover all of those who did survive?
    Admiral Allen. Sir, you're getting back to my original 
point. I think we need to look at the entire event, including 
the issue with the loss of life and the search and rescue----
    Mr. Landry. If I may cut you--but, I mean, do you believe 
that? It's like a yes or no----
    Admiral Allen. I think we need to do an assessment of 
whether the resources on the scene were capable of rescuing in 
all conditions. I think that's a legitimate point.
    Mr. Landry. OK, OK. But wait, wait, wait. On September 2nd, 
the Mariner platform had an accident where 10 gentlemen ended 
up in the water, one of them without a life preserver. Again, 
in the summer. It took 10 hours--there was no stand-by vessel 
there--it took 10 hours before we recovered them.
    My question to you is this. If that would have happened in 
the winter, would we have lost more--would all 10 of those men 
have survived?
    Admiral Allen. It would depend on their adherence to 
procedures, their safety suits and the systems they're supposed 
to use, sir.
    Mr. Landry. No--well, evidently----
    Admiral Allen. There are systems in place that will protect 
them----
    Mr. Landry. Well, evidently, one of the systems--one guy 
ended up in the water without a life preserver.
    My question is that you would agree that they are--that 
they can be--that hypothermia can certainly affect them.
    Admiral Allen. Yes, it can.
    Mr. Landry. And ultimately lead to death.
    Admiral Allen. Yes.
    Mr. Landry. OK. Thank you.
    Mr. LoBiondo. OK. Mr. Farenthold.
    Mr. Farenthold. Thank you. Just, first off, a real quick 
follow-up from the question from the gentleman from the coast 
of Louisiana.
    You indicated that you felt like the waiver provision of 
the Jones Act was adequate to deal with this situation. My 
understanding was the waivers were taking 10 days to get 
processed. You think 10 days is a reasonable enough time, in 
the event of a disaster like this blow-out, or something like 
Katrina?
    Admiral Allen. Well, the waivers that were requested were 
stand-by waivers in the event we had to move these vessels due 
to heavy weather. So there wasn't an extremist or urgency 
situation attached to that.
    I have been involved in other environmental responses in my 
career, where we needed timely waivers, and received them as 
part of an environmental response, sir.
    Mr. Farenthold. Great. I think one of the other points we 
talked about, both in Arctic drilling and the Gulf of Mexico is 
the United States isn't the only participant there, United 
States oil companies, and there is land out there that isn't 
regulated by the United States. In the Gulf of Mexico, you've 
obviously got drilling from the state oil company of Mexico. 
China is operating off the coast of Cuba. And what I see out of 
this report is a plethora of new regulations and taxes on the 
domestic oil company with no thought about what's going to 
happen in the event of an accident like this occurring on a 
foreign government-owned drilling platform or rig.
    What contingencies do you gentlemen see there? And do you 
think maybe the focus might be on developing more--on 
developing better responses for anything that happens 
regardless, as opposed to putting our domestic oil companies at 
a competitive disadvantage?
    Mr. Garcia. Well, Congressman, certainly there is a 
challenge right now in international waters. You're right. The 
Gulf of Mexico is shared by several nations. And the Arctic has 
a number of nations whose companies are beginning to examine 
the possibility of drilling. And we need to address that.
    If there were a blow-out by one of these other companies--
and some of these companies are very safety-challenged--it 
would be a serious problem for us. And the Commission did, in 
its report, identify that as a problem. That's going to require 
a transnational solution, though.
    We did recommend changes for U.S. industry. Again, we think 
that there are changes that can be done that would involve 
minimal cost, and would make this industry safer. The 
Commission's report was designed to get the industry back to 
work. And I think that, if you have read it, hopefully you 
would agree with that.
    Mr. Farenthold. I have--I will admit it was a big report, I 
was skimming during some of the opening statements, but have 
not read it cover to cover. I look forward to reviewing it 
thoroughly.
    There was also a comment regarding fully restoring the 
Gulf. And I would be interested to know how that is defined. As 
you know, oil in the Gulf of Mexico is not strictly a result of 
manmade operations. Obviously, we have got a huge point source 
over a short period of time. But, I mean, fossil evidence 
back--and arts and crafts of the Karankawa Indians indicate 
there is an ecosystem in place to take care of that.
    What do we define as fully restoring the Gulf, and what do 
we leave to Mother Nature to restore?
    Mr. Boesch. Sure. First of all, let me just, if I can, 
amend Terry's comment, but also reflect on Mr. Young's point 
about the oil and gas development taking place in many Arctic 
nations. We have some recommendations specifically for the 
Arctic, but also internationally, that it is in the U.S.'s 
interest to work with the international industry, but also the 
other nations, to develop common standards, both in terms of 
safety, as well as response.
    And in the Arctic, I want to point you to the last part of 
Admiral Allen's written testimony, in which he says a really 
key part of that is the ratification of the Law of the Sea, the 
U.S. ratification of the Law of the Sea, which is greatly 
supported by the industry, by the military, and we really need 
to do it in order to have a level playing field in dealing with 
these international issues.
    Specifically with respect to restoring the ecosystems, I 
think we recognize that you can't fully restore the evolving, 
changing Gulf of Mexico to the way it was at a certain time. 
What we are interested in, what we are recommending, is that 
the environment be restored to the point where it recovers a 
certain resilience. From the current state of dysfunction, it's 
able to function so if you have future oil spills, it's in much 
better capacity to withstand those impacts. And that's what we 
recommend for this restoration program.
    To restore the longer-term damages, there is the natural 
resources damage assessment, which specifically addresses the 
impacts of this oil spill, and to try to correct those to the 
way it was----
    Mr. Farenthold. All right. And finally, just for one 
second, the Hart Institute at Texas A&M Corpus Christi, is very 
active in coordinating state and local responses with the 
Federal Government. I commend them to you as a resource. Thank 
you very much.
    Mr. Boesch. We have used them, right.
    Mr. Farenthold. Thank you.
    Mr. LoBiondo. OK. Thank you. Mr. Bucshon.
    Dr. Bucshon. Thank you, Mr. Chairman. I have a background 
in medicine. I was a cardiovascular surgeon prior to doing 
this. And one thing I have learned from medicine is that the 
international community can be very valuable in understanding 
health care.
    And my question goes to the fact that there obviously have 
been oil spills in other parts of the world that we have not 
been involved in. And, other than from what the government 
response has been from a regulatory standpoint or otherwise, 
are there things that we have learned, or we could be learning 
about their platforms, about how they actually handle their 
clean-up afterwards? And were those countries offering advice, 
in our case, that U.S. regulations prevented us from utilizing 
those resources, and helping us?
    Admiral Allen. I will make a short comment and pass it to 
my colleagues here.
    First of all, I think the two best examples are probably 
Norway and the UK. In the 1980s there were 2 very serious 
accidents with significant loss of life in Norway and the UK. 
That resulted in a refinement of the regulatory environment to 
move to the safety case-based system that we talked about 
earlier, and safety management systems.
    There was a recent blow-out of the Montera oil right off 
the northwest coast of Australia in 2009. They operate under 
that same system, and that was reviewed as part of their 
response. And that still supports a safety case way to go 
forward, as we said earlier, and I am supportive of a hybrid 
system that would take advantage of what we learned overseas, 
both with the requirement for third-party validation of their 
drilling systems.
    Mr. Garcia. Yes, I fully agree with the admiral. One of the 
other things that we found was that the industry was not 
sharing best practices and information. And so the industry 
could do a better job of that.
    And, Congressman Farenthold, if I could say I'm on the 
board of the Hart Institute, so I agree with your assessment.
    Dr. Bucshon. I think I--again, I understand the regulatory 
changes and the structural changes from the government level, 
but--and what you--your comment about the industry sharing 
technology, were there--are there clean-up methods that they 
have used that we could have used that our U.S. regulations 
prevented? I am naive to those, that's not my area.
    But--and if there were--like I said, in medicine, the 
information from the international community is usually very 
valuable. And I have always found, as a citizen of the United 
States, that people always ask us to help, and we usually help. 
But when people ask--we don't generally ask for as much help as 
we can. And I think sometimes there are things to be learned 
and things to take advantage of that maybe we don't properly 
utilize. That's my overall assessment. Thank you.
    Admiral Allen. Sir, the overwhelming majority of foreign 
offers of assistance that we dealt with had to do with actual 
physical equipment, and this had to do with more of how much we 
could get and how we needed it and how fast we needed it. This 
usually involved skimming equipment, a boom, especially a fire-
retardant boom, and dispersants, when we were using 
dispersants.
    Some of the more novel things we might have used, like 
bioremediation and some of the new technologies, fall into the 
comments that I made earlier, where, because of the paucity of 
research and development that took place in the last 15 years, 
we were at the point where we were trying to do research and 
development and bring new products to market during the spill 
itself. We can't allow that to happen again. And I think the 
real challenge was, domestically, to bring those technologies 
in and get them into the game.
    Mr. Garcia. And, sir, I would just say that, you know, one 
of the sad facts of this incident is that the industry simply 
did not have the response and containment technology that was 
adequate to contain this blow-out in a reasonable amount of 
time. It took them almost three months.
    Dr. Bucshon. Just a comment, and then I will finish. Again, 
going back to medicine, I have learned that there is--
international studies in health care, especially in the heart 
surgery area related to prosthetic devices and the like that 
have been utilized in Europe and other areas around the world 
for many, many years that, in the United States, are prevented 
from being utilized by medical professionals, based on our very 
slow and very onerous regulatory process.
    And so, I guess I will--my question was directed at are 
there things like that in your industry that are out there, but 
that we want to do our own R&D, and we don't rely on 
international data, and that our structure really prevents us 
from using for decades when they have been found to be 
effective in other areas?
    Admiral Allen. I guess I would say, in regard to well 
control and containment of the well, because it was operating 
offshore and basically in waters outside state waters, and BP 
and the industry were the ones that had the means to control 
that well and cap it, that the free market was flowing just 
about whatever was working and could be used there to that 
site.
    Mr. Boesch. Let me just say also on that issue, there are 
two organizations which the industry is standing up to be able 
to provide that capacity, to contain a blown-out well.
    And so, they represent some substantial investment that 
they know they now need, and they are going to be based right 
there in the Gulf of Mexico, probably Mr. Landry's district, 
this stand-by capacity. And the research and development 
associated with it is part of that evolving economy in the new 
world of how we do offshore oil and gas development.
    Dr. Bucshon. Thank you.
    Mr. LoBiondo. Mr. Harris?
    Dr. Harris. Thank you very much, Mr. Chairman. First of 
all, Admiral Allen, it's a--thank you very much for coming and 
appearing. And you were a great face for the U.S. Government, 
really, during this entire crisis. And I thank you for that.
    Dr. Boesch, it's good to see you. Of course, sitting on the 
environmental committee in the State of Maryland, I have seen 
you many times, and I'm glad to see you here----
    Mr. Boesch. I don't have to call you ``Senator'' now, 
though.
    Dr. Harris. That's right. Let me just ask a question. I had 
the privilege of attending a briefing by Mr. Riley and Senator 
Graham in the Natural Resources Committee, and my colleague 
from Alaska suggested at that time that the Commission members 
really all may have had an initial bias against offshore oil 
exploration and drilling. And I was pleased to see that in the 
forward to the report, it suggested on the last page that if 
the offshore energy enterprise is threatened, that the Nation's 
economy and security are threatened, and I couldn't agree more 
wholeheartedly.
    Off Maryland, which is one of the frontier areas that are 
described in the last part of the book, you know, our coastal 
counties have an unemployment rate between 10 and 18 percent. 
It's seasonal employment, but it's high. And I personally feel 
that perhaps we should be looking at offshore exploration, 
drilling off the shore.
    In the chapter where you talk about--chapter 10 of the 
report--you do say that the biological and environmental 
factors are well understood in those areas, unlike the Arctic.
    And, therefore, my question is, do you think, if we 
implement what's found here--and this is specifically for Dr. 
Boesch and Mr. Garcia--do you think we should, in fact, because 
of our Nation's economy and security, go forward with OCS 
exploration off the mid-Atlantic coast?
    Mr. Boesch. Well, we take no specific position about the 
expansion of oil and gas exploration and production outside of 
the two areas that we focused on, other than to indicate that 
we need to approach this in a different way, where there is 
more substantive analysis that engages the other agencies, in 
addition to Interior. The potential environmental risks should 
be judged in the context of the amount of economic gain and 
benefit, with respect to the energy supplies that may be there.
    One of the things that focused our attention so much on 
Alaska, quite frankly, in addition to its unique and unusual 
sensitivity, is that the industry and the USGS are saying 
that's where most of the remaining oil is, outside of the Gulf. 
And so there is going to be enormous pressure to develop it. 
And we need those resources, if they can be developed safely.
    Dr. Harris. Thank you.
    Mr. Boesch. The other areas are less rich, in terms of 
resources, and we have to do that analysis.
    Dr. Harris. Mr. Garcia?
    Mr. Garcia. I would just add that the Commission report was 
designed to provide recommendations on how to drill safely. 
Where that drilling might take place would be up to the 
administration, and perhaps to the Congress.
    Dr. Harris. Well, let me back into it, because, Dr. Boesch, 
you kind of indicate that you don't--that you didn't take a 
position, really, on the safety. I'm going to ask you not as a 
commissioner, but personally to address Mr. Young's criticism.
    Do you feel that if you implement these recommendations in 
the Gulf, is it safe to do in the Gulf? And should we, in fact, 
be doing it in the Gulf?
    Mr. Boesch. If these recommendations are implemented, yes. 
We have said that you can safely drill, and we believe this 
report sets that out.
    And I would also say, in response to Mr. Young's point 
about whether there was bias, I believe Mr. Riley said that we 
should let the report speak for itself. And our position is 
contained in this report.
    Dr. Harris. Thank you. Then let me take the next step. If 
your position is that, yes, it's safe to do in the Gulf, and 
perhaps should be done in the Gulf, and in chapter 10 you say, 
``Well, you know, off the mid-Atlantic coast, the biology and 
the environmental considerations are fairly well known, it's 
not--it perhaps should be treated different than the Arctic,'' 
then if there are reserves found off the coast of Maryland, for 
instance, or Virginia, both of which will help employment in my 
area, in my district, then would you conclude that, therefore, 
it should be done in those areas also, if there are reserves 
that are proven to be economically beneficial?
    Mr. Boesch. As I understand it, the President acted earlier 
last year to the Congress's lifting the moratorium around a 
larger area, by saying that the U.S. is going to evaluate these 
very questions about whether the resources that are there are 
worth the potential risks, evaluating whether the benefits are 
there, as well as a more detailed analysis of the existing 
data.
    What our comments were meant to suggest is that in those 
environments we're not talking about or suggesting that one 
needs, you know, five years of intense study and data analysis, 
that we already know a lot about those regions. And that 
information, just as the proposal, should be brought into 
consideration of making the determination.
    Dr. Harris. Thank you, Mr. Chairman.
    Mr. LoBiondo. Thank you, Mr. Harris. Congresswoman Edwards.
    Ms. Edwards. Thank you very much, Mr. Chairman. Glad I made 
it back in the nick of time. Thank you very much to the 
witnesses.
    The question that I have actually regards some oversight 
issues that came up during the 111th Congress, and related to 
the flow rate and the wide variations of flow rate estimates, 
and the impact on response coordination. There were some 
questions that came up in our oversight in the last Congress 
about risk assessment and contingency planning. And 
particularly, I raised issues related to the worst-case 
scenarios, which didn't even seem to come close to the scenario 
that was reached in the spill.
    And so, I wonder if you can talk to me a bit about the 
recommendation that you have made, and how we can improve the 
independence of the assessments that are done, so that they 
have a little bit more validity, because that's also related to 
what the financial liabilities are, as well. And so, if you 
could shed some light on that, I would appreciate it.
    Mr. Boesch. Sure. Ms. Edwards, first of all, you're right. 
We did address this issue of the flow rate. First of all, with 
respect to the flow rate estimates, they probably had 
relatively little effect on the spill response, in terms of the 
assets and resources that could be deployed. That's more of a 
function of where the oil is going.
    However, what we concluded is that there were two important 
lessons from the underestimation of the flow rate for so long. 
First is that it became very important to right-size and design 
the containment effort. So, the initial efforts to try to 
control and contain the well were doomed to failure, because 
they assumed a lower flow rate. So for containment, it's really 
important.
    Secondly, for confidence of everyone that the government is 
on top of this thing, that confidence is not diminished. And 
so, for that reason alone.
    And then finally, as you pointed out, the flow rate becomes 
important with respect to the assessment of damages under the 
Clean Water Act.
    Mr. Garcia. And, Congresswoman, if I could just add, the 
good news is that there are some very simple fixes that we have 
suggested in our report that would allow the government and the 
industry to be able to accurately estimate flow rates so that 
you don't have this problem in the future. It's just a matter 
of adding some simple instrumentation to the blow-out 
preventer. And it is a relatively inexpensive fix.
    Admiral Allen. Could I add a comment, please, ma'am?
    Ms. Edwards. Sure, thank you.
    Admiral Allen. First of all, I agree--very low-cost 
investment. And sensors on the blow-out preventer will give you 
an accurate flow rate without any big dispute, I think, among 
the people that are involved. We have never had to deal with a 
well blow-out at 5,000 feet, and having to establish a flow 
rate. That had never been presented to any response in this 
country in its history.
    Into the response--when this became a matter of public 
concern and political concern, I basically took that function 
and gave it to the flow rate technical group, which is a spin-
off of our inter-agency solutions group that I established in 
the national incident command, to have an independent 
government way to assess that, with the means we had, lacking 
the sensor data that should be in there, and that was due to 
using the high-resolution video and other means. Once we did 
that, that allows us to have a baseline to tell BP what 
capability they had to build out, in terms of a containment.
    Ms. Edwards. And then lastly, if one of you could please 
comment on this question of kind of risk assessment and 
contingency planning, because both the estimates--and when I 
looked at the standards for what was essentially rubber-stamped 
from MMS regarding the risk assessments, it almost seems as 
though the industry could kind of put a risk assessment in 
front of MMS, there were a few questions that were asked about 
it, and they were all pretty much the same. And that, in 
itself, I would guess, had to contribute tremendously to the 
ability to project what the risk might be, and to establish 
mechanisms that would allow for appropriate contingency 
planning.
    Mr. Garcia. Congresswoman, you're right. We have suggested 
in the report that a better review be done of response plans. I 
think you're referring to the fact that most of the companies 
essentially Xeroxed and submitted boiler-plate to MMS for their 
response plans. And neither the government nor the industry 
apparently were paying attention, since they referenced species 
that did not normally make their homes in the Gulf, such as 
walruses. So, yes, a much better job needs to be done.
    And again, it indicates the widespread failure of 
oversight, as well as a complacency within the industry.
    Mr. Boesch. This is very important, because we've gotten 
some criticism for the use of the words ``systemic problems.'' 
And by systemic, we don't mean that all companies were equally 
negligent as BP was. By ``systemic,'' we mean all companies 
were using those same irrelevant plans. None of the companies 
had a containment capacity. Any number of things were 
widespread problems throughout not only the industry, but also 
the regulatory regime.
    Ms. Edwards. Thank you very much, Mr. Chairman, and thank 
you to the witnesses, particularly for the thoroughness and the 
expeditious manner in which you got this report done. With that 
I yield.
    Mr. LoBiondo. OK. Mr. Landry?
    Mr. Landry. Thank you all. I just got some important 
questions. I want to kind of--let me just make a comment.
    I appreciate you all continuing to edit your comments on 
systemic. I think you should go back and look. And not all oil 
companies designed and engineered their wells the same. So 
you're getting there, Mr. Boesch.
    Admiral Allen--you know, and I am--there are parts of this 
report that I am interested in helping these guys implement, 
and one of them concerns the safety of the workers. So I just 
simply want to go back to those scenarios and ask you do you or 
don't you believe that having stand-by vessels or a vessel 
within at least an hour's time where there are drilling 
activities or manned platforms, does that or does that not 
create a safer environment for those workers?
    Admiral Allen. Well, obviously, having a vessel standing by 
is a safer environment.
    Regarding the threshold requirements on when you would have 
a vessel, I think those are the types of determinations that 
would be made by the current ongoing joint investigation. 
That's not only looking at how the incident occurred itself, 
but the performance of the systems on the vessel, and the life-
saving systems on the rig itself. And I think those are logical 
areas for inquiry, and where they need to be adjusted, as they 
should be.
    Mr. Landry. Thank you, Mr. Chairman.
    Mr. LoBiondo. Mr. Larsen?
    Mr. Larsen. Thank you, Mr. Chairman. Just quickly here, 
page 142 and 143 of the Commission report discussed the Jones 
Act. You said, ``These restrictions on the Jones Act did not 
even come into play for the vast majority of vessels operating 
at the well head, because the act does not block foreign 
vessels from loading and then unloading oil more than three 
miles off the coast. When the act did apply, the national 
incident commander appears to have granted waivers and 
exemptions when requested.'' Did I read that accurately?
    Admiral Allen. Yes, sir.
    Mr. Larsen. Thank you. Page eight of your testimony, 
Admiral, ``In reality, the Jones Act had no impact on response 
operations.'' Did I read that accurately?
    Admiral Allen. Yes.
    Mr. Larsen. Did my reading of those accurate statements 
accurately reflect your thoughts, as well?
    Admiral Allen. Yes.
    Mr. Larsen. Thank you. With regards to oil spill response 
recovery organizations, the OSROs, this is sort of the flip 
side of this argument about Jones Act, about wanting to get 
equipment in there, but then not really needing the equipment, 
where the OSROs had equipment here in the U.S. And I wouldn't 
say it was a scramble, but it was briefed by our folks in 
Washington State and at district 13, and just trying to 
identify who had what, what would be useful, and how soon can 
you get it there without impacting state-based needs and 
operations.
    Do you have recommendations about the OSROs and oil spill 
recovery organizations, and how they can fit in better and 
create an inventory to know where this equipment is when we 
need it?
    Mr. Boesch. Well, I think we certainly do. And we identify, 
first of all, the lack of capacity to have responded to 
something which was so wide-scale and lasted so long by the 
OSROs.
    But also, related to that is our observations and 
conclusions about the diminution or the lack of advancement of 
the technology that they have used, and the degradation of 
their assets and capacity, if they were mainly dealing with 
smaller-scale activities on a more routine basis to then deal 
with something of this consequence. They were clearly out-
gunned in that sense. And so we need a more effective way to do 
that. Perhaps Admiral Allen has----
    Admiral Allen. Sir, I think what you're referring to is we 
actually went through an emergency rulemaking that allowed us 
to lower the stand-by requirements for the conduct of 
operations at facilities that had oil spill response equipment, 
but could not legally move it because it was a condition of 
operations.
    Mr. Boesch. Right.
    Admiral Allen. This became very, very complicated, because 
the only way we could do that was actually to issue an 
emergency Federal rule. And, even then, there were residual 
issues with state law and state requirement, in some cases, 
personal liabilities for operators of facilities, and even 
commanding officers of naval installations, were they to give 
that equipment up, and something were to occur.
    I think, moving forward, we need to look at this, because 
if you have a spill and you want to bring all available means, 
we have emergency compacts between states that allow movement 
of resources when they need that. I think there needs to be a 
measured discussion and an evaluation of how we can do that.
    And that's the reason I said if there is a national 
incident commander designated, there should be a presidential 
designation. And with that should come the authority to move 
those resources, if it is needed, without going through an 
emergency rulemaking process. That said, I think we all need to 
understand the threshold of what needs to stay behind, so you 
have a minimum level to respond, if you do have an incident.
    Mr. Larsen. Something along the lines of when the National 
Guard might move from one state to the next for firefighting to 
help with a mutual aid type of situation.
    Admiral Allen. Exactly, sir.
    Mr. Larsen. Yes, yes. With regards to the Arctic, I will 
talk to Mr. Young afterwards, so I want to be sure I'm not--we 
have a good relationship, and I want to be sure I talk to him 
about these questions, so--I want to be clear about it.
    But he mentioned the leasing of ice breakers. From whom 
could we lease ice breakers for the Arctic operations, if we 
had to lease?
    Admiral Allen. Well, sir, if I could just take one step 
back, there is a de factor implicit assumption in his statement 
that we need ice breaking capability. How you source that, 
whether you build an ice breaker or lease an ice breaker, is a 
second step. We haven't even gotten to the point in this 
country where we have recognized that there is a capability 
requirement, and we need to do something about that. The lease 
is just one way you could remedy that.
    I tried unsuccessfully for four years to get this on a 
national agenda to talk about this, because we have--we will 
have no floating capability to exert command and control from 
Point Barrow, unless we have an ship that's capable of doing 
that. And a lease could be one way. I really think that we 
probably need to have organic capability inside the United 
States to do that.
    But regardless of that, the real issue is nobody is talking 
about the ice breaker capability problem, and it's sitting 
there, staring us right in the face, sir.
    Mr. Larsen. But just to be clear, I understand Russia, 
China, Sweden all have ice breakers, probably none of whom 
would be willing to loan them to us or lease them to us unless 
they can recover the dollars for the lack of opportunity that 
they would have to use them for the same functions we would 
want to use them for.
    Admiral Allen. The National Science Foundation routinely 
leases foreign vessels to break out McMurdo for the annual 
resupply, and to stop using U.S. ice breakers.
    Mr. Larsen. Yes, yes. I have other questions.
    Mr. LoBiondo. Blake, you have anything?
    Mr. Farenthold. No.
    Mr. LoBiondo. Go ahead, Rick.
    Mr. Larsen. On the capacity of response in the Arctic, can 
you comment on our capacity to respond to a situation in the 
Arctic, separate from an ice breaker issue?
    Admiral Allen. I would be happy to.
    Mr. Larsen. Planes, trains, and automobiles. What do you 
have? What's going on?
    Admiral Allen. If I could specifically--I'm trying not to 
infer from the fact of whether or not there is response 
capability, there should be a decision on whether or not to 
drill, and these gentlemen have already stated that themselves.
    Mr. Larsen. Absolutely.
    Admiral Allen. My premise has always been, in my four years 
as commandant--because we moved assets to the north slope of 
Alaska in the summer to see how they operate--is the lack of 
infrastructure, footprint, and accessibility by equipment up 
there to be able to stage a response and use command and 
control that you need to do to do that.
    If you were to go to Robert, Louisiana, New Orleans, Houma, 
Louisiana, or Mobile, and looked at the command posts that were 
established to try and deal with this oil spill, there is no 
place on the north slope of Alaska to put something like that. 
And I am differentiating what an oil exploration company might 
have out there, in terms of response vessels. The oversight 
that has to be done, the burning, access to airstrips, all-
weather aircraft, all those are issues that come into play on 
the north slope of Alaska.
    And, from my standpoint as a former commandant, my concern 
was if I am held accountable to conduct a type of oversight 
that was basically pulled through a knothole by this 
Commission, there is a lack of a footprint up there to do that. 
This is independent of the merits associated with the oil and 
gas exploration.
    Mr. Larsen. Absolutely. Thank you. I want to be clear. I 
was not implying that trains and automobiles would be part of 
the response up there. I was only trying to talk about the 
broad range of infrastructure necessary for the response. For 
the record, everybody. Thank you.
    Mr. LoBiondo. Admiral Allen--and we talked about this a 
little bit--the Oil Pollution Act required the Federal 
Government to conduct exercises every three years to be 
prepared, and we think that was a good idea.
    Was the failure of these officials to participate in the 
March 2010 a missed opportunity for them to better understand 
how oil spill response functions under the national contingency 
plans would work, in your view?
    Admiral Allen. I do believe it was a missed opportunity, 
but I think we need to take a look at whether or not this was a 
problem of omission or commission.
    You know, in Washington we are under siege of the--this was 
not a tier one exercise and did not technically require the 
participation of cabinet-level officers. So there was basically 
no foul, but we gained no real benefit from having those folks 
exposed to the doctrine.
    My recommendation contained in my testimony is to hold 
another drill within one year, have cabinet-level officials 
involved, and let's immediately test the premises and the 
notions that are contained in the Commission report, and what 
comes out of these investigations. Let's not wait through the 
cycle, let's do one and figure out whether or not we've fixed 
the problem, sir.
    Mr. LoBiondo. I don't want to second-guess what you might 
say, but if the officials, whoever these officials may be, had 
participated, that could have affected in a more positive way 
the response?
    Admiral Allen. Well, you just have to look at who was 
called in when this event occurred. When the rig sunk on the 
22nd of April, 2 hours later myself, Secretary Napolitano, and 
the cabinet were in the Oval Office, briefing the President on 
what had happened.
    The people that were in the office having that discussion 
were not the people--because it was not a tier one exercise--
that would have been involved in the spill of national 
significance drill in March. That's the reason my premise would 
be moving forward to schedule another drill and make it a tier 
one exercise in which cabinet-level officials would 
participate.
    Mr. LoBiondo. Ms. Edwards?
    Ms. Edwards. Thank you, Mr. Chairman. To Commissioners 
Boesch and Garcia, you have made some significant 
recommendations that really go to what you have indicated--the 
Commission had indicated--as deep failures in oversight and the 
regulatory structure. And you've made some very significant 
recommendations to improve the regulatory structure.
    I wonder if you could comment, please, as we are in an 
environment in which there are deep cuts proposed to some of 
the agencies that you believe, in your report, need to step up, 
in terms of their oversight of this industry and the process at 
the Department of Interior, at NOAA, at EPA, and Coast Guard.
    Do you believe there is any inconsistency in the deep cuts 
that are recommended in these agencies and the ability of the 
agencies then to fulfill the recommendations you have made to 
prevent both the safety concerns and environmental concerns 
that might come to pass if there were another spill of this 
kind of national significance?
    Mr. Garcia. We certainly have indicated that changes need 
to be made in the agencies, and that they need to be adequately 
funded. One of the problems for the MMS was that it was 
underfunded and undermanned and, thus, incapable of effectively 
and fully overseeing this industry.
    Now, we have suggested that the new BOEMRE be funded 
through fees that the industry pays--I mean right now, the 
industry is paying just a tiny fraction of that agency's 
relatively small budget. And it would not be unreasonable for 
the industry, which is reaping large benefits from this 
resource, to pick up the cost of a competent and effective 
regulator.
    Ms. Edwards. Dr. Boesch, do you have any comment?
    Mr. Boesch. Yes, we have been through this together, we 
think alike, and we just about finish each other's sentences, 
but one thing just to add to that is that the Secretary of the 
Interior had requested of Congress an appropriation for fiscal 
year 2011 to enhance the capacity of BOEMRE to meet these high 
standards and to process these applications.
    And so, the lack of those funds obviously presents a 
handicap, not only to implementing our recommendations, but to 
getting the industry back to business.
    Ms. Edwards. If the Congress is unable or unwilling to 
impose the fees that you have--that are recommended, then 
inevitably, the cuts that are proposed for the agencies that 
would have oversight and responsibility in this regulatory 
framework would simply be unable to implement the regulations 
that you put forward, opening us up--if you could, comment on 
it--opening us up to the possibility that we would have another 
spill in deep water that we would be unable to clean up, and 
that we will not have been able to properly project.
    Mr. Garcia. Yes. Congresswoman, I would just say that this 
spill has cost us tens of billions of dollars. And the final 
price tab is not in yet. So, to the extent that a failure to 
properly regulate the industry would result from inadequate 
funding, that would be a tragedy.
    Ms. Edwards. Yes, and just to conclude and I will yield my 
time, I mean it does strike me that there is a very significant 
inconsistency in our desire to make sure that both industry and 
commerce are not impacted by a spill of this kind of 
significance in the future, ff we are unwilling, in the 
Congress, to do what it takes to make sure that the resources 
are in place so that our agencies can fulfill their 
obligations. And with that, I will yield.
    Mr. LoBiondo. Mr. Landry, are you looking for more time?
    Mr. Landry. I just wanted to address the gentleman from 
Washington's comment and ask Mr. Allen----
    Mr. LoBiondo. Because if you have additional questions, I 
am going to submit--I am going to suggest----
    Mr. Landry. Sure.
    Mr. LoBiondo [continuing]. You submit them for the record.
    Mr. Landry. Sure.
    Mr. LoBiondo. I don't want to cut anybody off, but we could 
go on for a long time, and I think we need to wind it up.
    [No response.]
    Mr. LoBiondo. OK. I want to thank the panel very much. I 
hope--well, we appreciate it. This was very informative.
    The subcommittee stands adjourned.
    [Whereupon, at 12:18 p.m., the subcommittees were 
adjourned.]
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