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

                     RESTORING JOBS, COASTAL VIABILITY, AND
                   ECONOMIC RESILIENCE IN THE GULF OF MEXICO:
                    H.R. 3096, THE RESOURCES AND ECOSYSTEMS
                   SUSTAINABILITY, TOURIST OPPORTUNITIES, AND
                      REVIVED ECONOMIES OF THE GULF COAST
                               STATES ACT OF 2011

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

                                    (112-66)

                                    HEARING

                                   BEFORE THE

                                  COMMITTEE ON
                       TRANSPORTATION AND INFRASTRUCTURE
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                DECEMBER 7, 2011

                                   __________

                           Printed for the use of the
                 Committee on Transportation and Infrastructure

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            committee.action?chamber=house&committee=transportation

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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
    ANDY HARRIS, Maryland                MICHAEL E. CAPUANO, Massachusetts
    ERIC A. ``RICK'' CRAWFORD, Arkansas  TIMOTHY H. BISHOP, New York
    JAIME HERRERA BEUTLER, Washington    MICHAEL H. MICHAUD, Maine
    FRANK C. GUINTA, New Hampshire       RUSS CARNAHAN, Missouri
    RANDY HULTGREN, Illinois             GRACE F. NAPOLITANO, California
    LOU BARLETTA, Pennsylvania           DANIEL LIPINSKI, Illinois
    CHIP CRAVAACK, Minnesota             MAZIE K. HIRONO, Hawaii
    BLAKE FARENTHOLD, Texas              JASON ALTMIRE, Pennsylvania
    LARRY BUCSHON, Indiana               TIMOTHY J. WALZ, Minnesota
    BILLY LONG, Missouri                 HEATH SHULER, North Carolina
    BOB GIBBS, Ohio                      STEVE COHEN, Tennessee
    PATRICK MEEHAN, Pennsylvania         LAURA RICHARDSON, California
    RICHARD L. HANNA, New York           ALBIO SIRES, New Jersey
    JEFFREY M. LANDRY, Louisiana         DONNA F. EDWARDS, Maryland
    STEVE SOUTHERLAND II, Florida
    JEFF DENHAM, California
    JAMES LANKFORD, Oklahoma
    REID J. RIBBLE, Wisconsin
    CHARLES J. ``CHUCK'' FLEISCHMANN,
    Tennessee

                                      (ii)

                                    CONTENTS

                                                                       Page

    Summary of Subject Matter........................................     v

                                   TESTIMONY
                                   Panel One

    Hon. Pete Olson, a Representative in Congress from the State of
      Texas..........................................................    20
    Hon. Jeff Miller, a Representative in Congress from the State of
      Florida........................................................    20
    Hon. Steven M. Palazzo, a Representative in Congress from the
      State of Mississippi...........................................    20
    Hon. Jo Bonner, a Representative in Congress from the State of
      Alabama........................................................    20
    Hon. Steve Scalise, a Representative in Congress from the State
      of Louisiana...................................................    20

                                   Panel Two

    Craig A. Bennett, Director, National Pollution Funds Center,
      United States Coast Guard......................................    35
    Tony Penn, Deputy Chief, Assessment and Restoration Division,
      Office of Response and Restoration, National Oceanic and
      Atmospheric Administration.....................................    35

                                  Panel Three

    Julian MacQueen, Chief Executive Officer, Innisfree Hotels,
      Incorporated...................................................    49
    Garret Graves, Chair, Coastal Protection and Restoration
      Authority of Louisiana.........................................    49
    Hon. Robert Craft, Mayor, City of Gulf Shores, Alabama...........    49
    Bill Williams, Commissioner, Gulf County, Florida................    49
    Robert H. Weisberg, Ph.D., Professor of Physical Oceanography,
      University of South Florida....................................    49
    Michael C. Voisin, Motivatit Seafoods, Houma, Louisiana..........    49

              PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

    Hon. Timothy H. Bishop, of New York..............................    66
    Hon. Rick Larsen, of Wasington...................................    69
    Hon. Cedric L. Richmond, of Louisiana............................    71

                   PREPARED STATEMENTS SUBMITTED BY WITNESSES

    Hon. Pete Olson..................................................    73
    Hon. Jeff Miller.................................................    74
    Hon. Steven M. Palazzo...........................................    76
    Hon. Jo Bonner...................................................    79
    Hon. Steve Scalise...............................................    82
    Craig A. Bennett.................................................    85
    Tony Penn........................................................    90
    Julian MacQueen..................................................    97
    Garret Graves....................................................   101
    Hon. Robert Craft................................................   115
    Bill Williams....................................................   121
    Robert H. Weisberg, Ph.D.........................................   125
    Michael C. Voisin................................................   132

                           SUBMISSIONS FOR THE RECORD

    Hon. Eddie Bernice Johnson, a Representative in Congress from the
      State of Texas, request to submit the following into the
      record:

            Hon Kathy Castor, a Representative in Congress from the
              State of Florida, letter to Hon. John L. Mica,
              Chairman, and Nick J. Rahall II, Ranking Member,
              Committee on Transportation and Infrastructure,
              December 6, 2011.......................................     3
            Tim Richardson, Director of Government Affairs and Alaska
              Program, American Land Conservancy, ``Why Habitat
              Conservation was a Cornerstone of Exxon Valdez
              Restoration,'' written testimony.......................     6
    Hon. Steve Scalise, a Representative in Congress from the State
      of Louisiana, request to submit the following letters in
      support of S. 1400 and H.R. 3096, the RESTORE Act, into the
      record:

            Letter from Greater Houston Partnership; Chamber
              Southwest Louisiana; Greater New Orleans, Inc.;
              Partners for Stennis-Hancock Chamber of Commerce;
              Mobile Area Chamber of Commerce; and Pensacola Bay Area
              Chamber of Commerce; to Senator Harry Reid, Senator
              Mitch McConnell, Representative John A. Boehner,
              Representative Nancy Pelosi, Representative Eric
              Cantor, Representative Steny H. Hoyer, Representative
              Doc Hastings, Representative Edward J. Markey,
              Representative John L. Mica, and Representative Nick J.
              Rahall II, November 9, 2011............................    27
            Letter from American Fisheries Society; American Fly
              Fishing Trade Association; American Sportfishing
              Association; Association of Fish and Wildlife Agencies;
              B.A.S.S., LLC; Berkley Conservation Institute, Pure
              Fishing; Center for Coastal Conservation; Coastal
              Conservation Association; Congressional Sportsmen's
              Foundation; International Game Fish Association;
              National Marine Manufacturers Association; Shimano
              Sport Fisheries Initiative; and Theodore Roosevelt
              Conservation Partnership; to Representative John L.
              Mica and Representative Nick J. Rahall II, November 1,
              2011...................................................    29
            Letter from Marco A. Giamberardino, MPA, Senior Director,
              Federal and Heavy Construction Division, Associated
              General Contractors of America, to Representative Steve
              Scalise, October 17, 2011..............................    30
            Letter from Stan Harris, President and CEO, Louisiana
              Restaurant Association, to Representative Steve
              Scalise, October 17, 2011..............................    31
            Letter from Louisiana Restaurant Association;
              Southeastern Fisheries Association; Texas Shrimp
              Association; Louisiana Seafood Promotion and Marketing
              Board; National Fisheries Institute; Gulf Oyster
              Industry Council; and Louisiana Seafood Processors
              Council; to Representative John A. Boehner and
              Representative Nancy Pelosi, November 10, 2011.........    32
    United States Coast Guard, response to request for information on
      oil spill capability questions raised by Hon. Blake Farenthold,
      a Representative in Congress from the State of Texas:

            Four Coast Guard projects to enhance the Service's
              response to a Spill of National Significance...........    44
            Cost of the four projects................................    45
            Funds allocated for 2012 Coast Guard oil spill response
              initiatives............................................    45

                             ADDITION TO THE RECORD

    Department of the Interior, written statement....................   136

    RESTORING JOBS, COASTAL VIABILITY, AND ECONOMIC RESILIENCE IN THE GULF
      OF MEXICO: H.R. 3096, THE RESOURCES AND ECOSYSTEMS SUSTAINABILITY,
     TOURIST OPPORTUNITIES, AND REVIVED ECONOMIES OF THE GULF COAST STATES
                                  ACT OF 2011

                                  ----------

                          WEDNESDAY, DECEMBER 7, 2011

                      House of Representatives,
        Committee on Transportation and Infrastructure,
                                                Washington, DC.
        The committee met, pursuant to notice, at 10:03 a.m. in
    Room 2167, Rayburn House Office Building, Hon. John Mica
    (Chairman of the committee) presiding.
        Mr. Mica. I would like everyone to take their seats, and we
    will call the committee--subcommittee to order. We will try to
    get started here. I expect Mr. Gibbs in just a minute.
        Welcome this morning to the House Committee on
    Transportation and Infrastructure hearing on the subject
    ``Restoring Jobs, Coastal Viability, and Economic Resilience in
    the Gulf of Mexico: H.R. 3096, the Resources and Ecosystems
    Sustainability, Tourist Opportunities, and Revived Economies of
    the Gulf States Act of 2011.''
        I see they have scheduled today three panels. The first one
    will be Members of Congress. And I would like to welcome them.
    As I said, Mr. Gibbs will be here shortly, but I wanted to go
    ahead and, in the interest of time, get this hearing started.
        The order of business will be opening statements by members
    of our panel, and then we will hear from the Members who have
    requested to testify this morning.
        First let me say that I was approached by many Members--and
    you will hear from some of them today--to enlist my support for
    the measure which I described. And I won't take a half-hour to
    recite the title of the bill again, but in listening to Members
    and in my position as chair of the committee, I understand
    their concerns in trying to make their States and the areas
    they represent whole.
        The oil spill incident that we had in the gulf was a
    horrendous tragedy impacting lives dramatically, hurting
    economies, destroying some of the ecosystem and doing damage to
    the economies in the whole region and the United States.
        The bill that has been crafted--and there have been several
    proposals I have heard dividing up any awards that may result
    here from litigation--are crafted primarily, I think, right now
    to the benefit of the Gulf States who secured--or rather,
    endured the primary damage. I thought what it would be best to
    do is to, rather than lend my support to a particular measure
    or division of some of those awards at this point, was to hear
    everyone out in open forum. And I hope to accomplish that. And
    we can hear from the Members, and they can provide for the
    record and, for what I hope to be a fair resolution of whatever
    proposal we come up with, their viewpoint and their--express
    their concerns on behalf of their constituencies.
        I, in turn, hold a position as chair of the committee, and
    somebody has to represent--even though I represent 1 district
    in Florida out of, right now, 25, someone has to represent the
    people of the United States in this division again, and try--
    and this attempt to make everyone whole, including the people
    of the United States.
        So, it is my hope that we can take from this testimony a
    good assessment of who has met their obligations in, first of
    all, trying to make folks whole after a very difficult
    situation. And then, if there is a division of any award, that
    it be done fairly and equitably, both among those impacted and
    on the basis of the damage they sustained, or that they have
    not been made whole for.
        It has been our intent in the committee to try to ensure
    that those responsible for the spill are held accountable, and
    it falls on them to, again, make whole and repair, as best they
    can, the damage. And also compensate the United States and the
    taxpayers for the cost incurred. So, that is the purpose of
    today's hearing. And I appreciate Members coming before us, and
    we will try to sort this out as best we can, be fair and
    equitable to all parties, including the United States
    taxpayers, who absorbed a great deal of cost and also took on
    the responsibility for the--managing the cleanup and other very
    expensive enterprises for which the United States probably has
    not been made whole.
        So, with that, that is those comments, let me yield--I
    guess Mrs. Napolitano, if you are ready--Ms. Johnson, are you
    ready? The gentlelady from Texas is recognized.
        Ms. Johnson of Texas. Thank you very much, Mr. Chairman.
    And thank you for holding this hearing and giving our
    colleagues an opportunity to testify.
        I will not take up any time away from their time, but I
    would like to ask unanimous consent to place in the record a
    letter from Congresswoman Castor. And two, a testimony from the
    American Land Conservancy. So, if you can accept that under
    unanimous consent, then I will yield back my time.
        Mr. Gibbs. [presiding.] So ordered.
        [The information follows:]

        Ms. Johnson of Texas. Thank you very much.
        Mr. Gibbs. Thank you for your indulgence here, while we get
    started. I am sitting in for Mr.--Chairman Mica. Welcome to the
    committee today, and I will start with my opening statement.
        The Deepwater Horizon oil spill was and continues to be a
    tremendous tragedy for the gulf coast and the Nation, as a
    whole. Over 87 days we all awaited anxiously as responders
    battled nature, logistics, and the natural limitations of
    technology to secure the well head.
        Like all of you, I felt a tremendous amount of relief when
    the well was finally secured. However, as you all know, the
    response did not end there. The efforts to mitigate the impact
    of the spill are ongoing today, and will continue for years to
    come. I fully support the ongoing restoration to repair the
    damage caused by the oil spill, and I know the gulf coast will
    bounce back stronger than ever.
        However, I do have some concerns about this specific piece
    of legislation. The responsible parties have already agreed to
    fully pay the cost of the spill response, damages, and
    restoration activities to individuals and businesses,
    environmental trustees in the Gulf Coast States. That could
    total over $40 billion.
        In addition, the State and local governments of the gulf
    coast currently receive 50 percent of the revenues for offshore
    drilling in the gulf, and use that funding for coastal
    restoration projects. The total cost is over $25 million,
    annually.
        Finally, the gulf coast has received billions of dollars
    for flood damage reduction projects in response to Hurricane
    Katrina, almost $15 billion of which went to projects in the
    vicinity of New Orleans. Now some are seeking billions in the
    Deepwater Horizon Clean Water Act penalties for those same
    activities. I have some concerns with the precedent that sets.
        Additionally, the language, as drafted, could potentially
    fund restoration projects with penalty money, allowing the
    responsible party to avoid payment under the Oil Pollution Act.
    The bill also comes with serious cost implications. CBO has
    scored the Senate version of this bill at $1.2 billion.
        And finally, the bill would redirect the penalties from the
    Oil Spill Liability Trust Fund to the States. The fund
    currently has a balance of $2.3 billion. Meanwhile, the cost of
    the Deepwater Horizon spill could total over $40 billion.
    Redirecting these penalties away from the fund could undermine
    efforts to respond to future spills, where the responsible
    party is either insolvent or is operating in the foreign
    waters, such as Cuba.
        I would like to thank the Members of the panel and I would
    like to now represent--recognize Representative Napolitano for
    any opening statements you may have.
        Mrs. Napolitano. Thank you, Mr. Chair. I don't have
    questions of the Members, but I am glad this hearing is going
    to shed a little more light on the issue that brought such a
    great tragedy to the Gulf States.
        I do ask for unanimous consent the statements from the
    members of the committee who were not able to make it be
    entered into the record.
        Mr. Gibbs. So ordered.
        Mrs. Napolitano. Thank you. And with that, I yield back.
        Mr. Gibbs. OK. At this time we will recognize our first
    panel of Members of Congress. I think the plan here is just to
    have your statements and not have questions. I think that is
    what we decided earlier on. So I will start with Honorable
    Olson. Welcome.

    TESTIMONY OF HON. PETE OLSON, A REPRESENTATIVE IN CONGRESS FROM
       THE STATE OF TEXAS; HON. JEFF MILLER, A REPRESENTATIVE IN
     CONGRESS FROM THE STATE OF FLORIDA; HON. STEVEN M. PALAZZO, A
    REPRESENTATIVE IN CONGRESS FROM THE STATE OF MISSISSIPPI; HON.
       JO BONNER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF
     ALABAMA; AND HON. STEVE SCALISE, A REPRESENTATIVE IN CONGRESS
                      FROM THE STATE OF LOUISIANA

        Mr. Olson. Thank you, Chairman Gibbs and Ranking Member
    Napolitano, for holding this hearing to examine the importance
    of the gulf RESTORE Act. Seated before you are five Members
    that represent the people who work and live in the Gulf States.
    And while each of us were impacted differently by the Deepwater
    Horizon spill, we have worked together to build a consensus to
    best address the challenges facing our States.
        When considering the economic recovery needs of the gulf
    coast, a one-size-fits-all approach won't work. Gulf coast
    communities know what they need for recovery. It is critical
    that any economic response reflects local priorities.
        In the 22nd Congressional District of Texas, which I
    represent, a significant portion of jobs are connected to
    manufacturers and small companies that rely on the offshore
    energy industry. This is an industry still reeling from the
    Obama administration's moratorium on deep water drilling in the
    Gulf of Mexico. The moratorium was only supposed to affect deep
    water drilling. But in reality, it impacted shallow water
    permits, as well.
        As a result, family-owned companies with generations of
    experience lost work as the drilling operations they supported
    moved out of the Gulf of Mexico. Hundreds of thousands of
    industrial, engineering, manufacturing, construction, and
    support jobs were impacted. The drilling moratorium was--has
    technically been lifted. But the de facto moratorium, also
    known as a ``permitorium,'' remains through the slow permitting
    process with devastating economic consequences.
        There have been signs of recovery. But jobs in the Gulf of
    Mexico are still well below the levels before the Deepwater
    Horizon accident. While offshore activities finally expected to
    return to pre-moratorium levels by mid-next year, we are still
    well below projected levels.
        The RESTORE Act will ensure that each State can address
    their specific recovery needs. Passing the RESTORE Act will
    bring us one step closer to the long-term ecological and
    economic recovery that the Gulf States most directly hurt by
    the spill desperately need. This bill and its Senate campaign
    will ensure a full recovery from the spill.
        As you hear testimony from the expert witnesses here today,
    I ask that you keep something in mind. Reversing the effects of
    the Deepwater Horizon is not just a regional interest. It is a
    national priority. The Gulf of Mexico supplies 30 percent of
    our Nation's energy, and is a powerful economic engine.
        The damage that occurred in the Gulf of Mexico--communities
    along the gulf coast should be able to allocate the penalty
    money where it will be most beneficial, without bureaucratic
    interference.
        I thank you for allowing me to testify before you today,
    and I look forward to working with this committee as the
    RESTORE Act moves through the committee process. I yield back.
        Mr. Gibbs. I thank you.
        Mr. Miller, Representative Miller, welcome.
        Mr. Miller of Florida. Thank you very much, Mr. Chairman.
    First I would like to, with all due respect, set the record
    straight. BP and the responsible parties have not, and in many
    cases do not, intend to make many of the individuals that were
    harmed economically especially whole in this instance.
        And I would also like the record to reflect that Florida
    gets zero revenue from any leases or any production in the Gulf
    of Mexico.
        I want to thank the other Members that are sitting here at
    the table today. It is a diverse group. And the fact that we
    were able to come together and be able to cosponsor a bill that
    was authored by our good friend, Mr. Scalise, who has talked
    about how important this RESTORE Act is for the gulf coast--not
    only the gulf coast, but also for the United States of America.
        This bill is about one thing, and it is restoring the gulf
    coast from the devastating--and I mean devastating--effects of
    the Deepwater Horizon spill in 2010. The fact that we are here
    today, almost 2 years later, still talking about the impacts of
    the spill shows just how widespread the disaster was for our
    communities.
        And you are going to hear about just how costly the effects
    of the spill were from local leaders, local economists,
    businesses, and environmental researchers in subsequent panels,
    so I am not going to go into what they will be testifying about
    this morning.
        You all know that oil on the beaches of northwest Florida
    drove the tourism industry over a cliff. And you know that oil
    is still being cleaned up in the marshes of Louisiana, and
    occasionally along the gulf coast, to the east. So instead, I
    want to make clear what this bill is not.
        This is not a handout or a backfill for local and State
    budgets. The RESTORE Act is about restoring the gulf coast from
    the worst oil spill in American history. As we have seen from
    the lingering effects of Exxon Valdez, these effects will be
    felt for years, if not for decades to come. The Federal
    Government has stepped in to help clean up the environmental
    damage, and the responsible parties set up a claims facility
    for individuals and businesses that were harmed.
        However, more needs to be done. More needs to be done to
    restore the environment that will be damaged for years to come.
    But frankly, there is already a mechanism set forth in the law
    requiring the responsible parties to pay for and take care of
    environmental cleanup. There is no such statutory requirement
    to compensate for economic damages. There is not a mechanism to
    restore the countless small businesses that have already gone
    out of business because of the Deepwater Horizon spill. There
    is not a mechanism to help the people who lost jobs, lost their
    homes, lost families because of the spill. You either roll the
    dice with the BP Feinberg claims facility, or you take your
    chances in court.
        The RESTORE Act fixes the imbalance by creating a way to
    rebuild local and State economies that took such a tremendous
    hit from the oil spill. And the RESTORE Act is the right thing
    to do. It does force the responsible parties to take care of
    the damage that they caused. This damage took place along the
    gulf coast and the fines paid for the damage should be returned
    to the gulf coast. The RESTORE Act will help restore us from
    the Deepwater Horizon disaster. And I would hope that this
    committee will take up this bill as quickly as possible. And I
    appreciate the opportunity to testify.
        Mr. Gibbs. Thank you.
        Representative Palazzo, the floor is yours. Welcome.
        Mr. Palazzo. Thank you, Mr. Chairman, Ranking Member,
    members of this committee. Thank you for the opportunity to
    testify this morning about this critical piece of legislation.
    The Gulf of Mexico has been a leader in American oil production
    for nearly 75 years. I am proud to say Mississippi has played a
    significant role in the exploration and production of oil and
    gas in America. In fact, Chevron USA operates its largest
    American refinery in Pascagoula, Mississippi. Many generations
    of Mississippians, including myself, have benefitted from the
    good-paying jobs provided by the oil and gas industry.
        Mississippi has also assumed the environmental
    responsibility that comes with the economic rewards. For
    decades, coastal residents have lived with the potential and
    real liabilities of the oil and gas industry so our region and
    the country could prosper economically.
        The Deepwater Horizon oil spill in 2010 dealt a serious
    blow to our gulf coast environment and our economy. It is now
    time to seize an opportunity to repair and restore not only the
    damages from the Deepwater Horizon oil spill, but the decades
    of cumulative impacts we have endured, as a region. The RESTORE
    Act allows us to do this through Clean Water Act fines and not
    taxpayer money.
        Under current law, responsible parties are required to pay
    fines for each barrel of oil spilled into the water. Without
    congressional action, these penalties will go toward unrelated
    Federal spending, and leave the necessary long-term restoration
    of our environment undone.
        The RESTORE Act provides Gulf States with the flexibility
    necessary to address long-term environmental and economic
    restoration issues as they arise. The continued environmental
    deterioration of the gulf coast poses a growing threat to
    ecosystems that support not only the regional communities and
    cultures, but also our Nation's most critical energy, shipping,
    tourism, commercial, seafood, and other industries.
        Two official reports on the spill, one conducted by Navy
    Secretary and former Mississippi Governor, Ray Mabus, and the
    other from the bipartisan National Commission on the BP
    Deepwater Horizon Oil Spill and Offshore Drilling, recommended
    that CWA penalties be dedicated to gulf coast restoration.
        The RESTORE Act is a unique opportunity for healing. It
    will help rebuild and strengthen our gulf coast ecosystems, and
    it will also support America's economic recovery. I strongly
    believe that recovery along the gulf coast can lead to recovery
    around the United States. Many of our Nation's key economic
    resources depend on the gulf's delicate and vulnerable
    ecosystem. A healthy gulf coast ecosystem means a healthy
    American economy.
        Let me provide a few examples. Gulf energy helps power
    America. Nearly one-third of domestic oil production comes from
    the Gulf of Mexico. Ports and other infrastructure supported by
    the environment are necessary in keeping this industry
    functioning. As of now, the gulf is home to 10 of our Nation's
    15 largest ports by tonnage, and there is a $621 million port
    expansion plan in Gulfport, Mississippi.
        The Gulf of Mexico produces 40 percent of all commercial
    seafood in the lower 48 States. Our Nation's seafood industry
    is clearly relying on a healthy gulf.
        Tourism heavily depends on a healthy gulf. Restaurant,
    hotel, and other hospitality workers are part of the gulf's $34
    billion-a-year tourism industry.
        Clearly, restoring communities and the environments of the
    gulf is critical to both the Gulf Coast States and the Nation,
    as a whole. It is in our Nation's best interest that this
    Congress works diligently and passes the RESTORE Act. There is
    no time to waste. The Gulf of Mexico needs it. America needs
    it. Mr. Chairman, Ranking Member, and other Members, thank you
    for your time. I yield back.
        Mr. Gibbs. Thank you.
        Representative Bonner, welcome.
        Mr. Bonner. Thank you, Mr. Chairman and members of the
    committee for holding this time-sensitive hearing. And special
    thanks for affording some of us an opportunity to share our
    experiences and our thoughts with you.
        The RESTORE Act, as has already been noted, is vitally
    important to both the gulf coast and to our country. And it is
    the Members who are here today from the five Gulf Coast States
    of Texas, Louisiana, Mississippi, Florida, and Alabama, on
    behalf of the millions of American taxpayers who reside on
    those--in those States and along that gulf coast who very much
    appreciate the opportunity to share with you some of the
    reasons why we believe this legislation is the right solution
    and the right resolution to this tragedy.
        On a personal note, I am also grateful to the committee for
    giving one of our local leaders, Gulf Shores Mayor Robert
    Craft, who will be in one of the later panels, an opportunity
    to bring his unique perspective, as well. Mayor Craft is one of
    the many unsung heroes from this tragedy, in that he and so
    many other local leaders helped their communities keep the
    faith, especially during the darkest days of this, which was
    the worst manmade disaster in U.S. history when, as we can all
    recall, it didn't seem that anyone or anything could plug that
    plume of oil that was spewing up more than a mile deep off the
    bottom of the Gulf of Mexico.
        While unlike the chairman of the committee, who hails from
    a State whose total coast line is more than 600 miles of
    beautiful white sandy beaches, Alabama only has about one-tenth
    of that amount. In fact, even today many Americans are
    surprised to learn that Alabama has some of the most beautiful
    beaches in the world, all of which are located in my
    congressional district, in southwest Alabama.
        But whether along the Florida Panhandle or in communities
    like Fort Morgan, Orange Beach, Gulf Shores, Dolphin Island in
    Alabama, the beaches along the northern Gulf of Mexico are as
    unique and as desirable to vacationers as any in the world. For
    generations, the beaches of Baldwin and South Mobile Counties
    in Alabama have been Vacation Central for Alabamians and for
    people all along the Gulf Coast States. Unfortunately, on April
    20, 2010, the tragic and deadly Deepwater Horizon explosion
    changed that image in the minds of millions of Americans.
        As oil began to wash ashore weeks later, fisheries were
    shut down. Hotels and condominiums lay vacant. And restaurants
    that were normally filled with tourists in anticipation of a
    good tourism season were empty. To say we struggled to stay
    afloat during that season would be an understatement. But to
    not acknowledge that businesses are still struggling almost 2
    years removed from this event would be doing everyone who lives
    along the gulf coast a great disservice.
        Thankfully, most of the visible oil has been removed from
    our beaches, and tourists returned to the Alabama gulf coast
    this past summer in record numbers. But for all the great
    progress that has been made, Mr. Chairman, there is still a lot
    to be done to fully heal the scars, and to ensure that future
    threats to our region will be minimalized.
        Members of the committee, the five of us are making the
    case today that there is still every reason to be concerned
    about future economic and environmental impact from the oil
    spill. A lot of questions still are not answered. And make no
    mistake. Each Gulf Coast State was affected in a different way
    from last year's spill. Some States, like Louisiana, arguably
    had more environmental damage, while others like Alabama
    endured significant and adverse economic impact. Our beaches in
    particular lost at least 1 million tourists during the 2010
    season. And the absence of these tourism revenues struck just
    as our area was trying to recover from the worst recession
    since the Great Depression.
        While we should all be hopeful about the prospects of
    putting the nightmare of 2010 behind us, the progress made
    toward the cleanup is but a hollow victory for thousands of
    local businesses and individuals which were dealt crippling
    blows during a tourism season that was a complete loss. Entire
    communities are still reeling from business losses, while the
    presidentially appointed administrator of the BP claims system,
    Mr. Ken Feinberg, continues to slow-walk approval of the
    legitimate claims payments.
        While that is not what this hearing is about, I for one
    believe Mr. Feinberg's gulf coast claims facility has been
    nothing short of a colossal failure, and should be an
    embarrassment for the Obama administration that set it up.
        That said, bringing the majority of the Clean Water Act
    fines assessed against BP, TransOcean, Halliburton and others
    back to the Gulf Coast States is only fitting, as our region
    was uniquely and undeniably affected by this tragedy. As those
    of us who live along the Gulf of Mexico already know, our
    backyard is vital to the economic health of our entire Nation.
    As Mr. Palazzo and others have said, it is home to the vast
    majority of oil and gas production that benefits the entire
    country, as well as 40 percent of the country's seafood
    production. And it is a major world-class tourism destination
    that has economic benefits for the entire country.
        In fact, if the United States Gulf Coast States, our five
    States of Alabama, Florida, Louisiana, Mississippi, and Texas
    were an individual country, they would rank seventh in global
    GDP with more than $2.5 trillion annually. It is for this
    reason, Mr. Chairman, among many others, critical that the Gulf
    Coast States, which bear so much risk, even today, be afforded
    access to the majority of the Clean Water fines collected to
    restore the damage that has been done, and to better prepare
    our region to respond to future crises.
        I am personally pleased that the five of us and the other
    Members, in a bipartisan way, who live in the five coastal
    States have worked to support Mr. Scalise and the legislative
    initiative that he helped bring to this table today--and I very
    much appreciate the committee and the Members giving this bill
    your serious consideration as a solution to a tragedy that
    should have never occurred. Thank you, Mr. Chairman.
        Mr. Gibbs. Thank you, Representative.
        Representative Scalise, welcome.
        Mr. Scalise. Thank you, Chairman Gibbs, Ranking Member
    Napolitano, and the members of the entire committee for having
    this hearing. I also want to thank my colleagues from the gulf
    coast for being with us here today. We have all worked hard to
    bring together a bipartisan coalition of support for this bill.
        I do also want to correct the record. Louisiana won't even
    start getting revenue sharing until 2017 on offshore drilling,
    and it will be far below the 50 percent that was mentioned.
        But before I begin my testimony, my colleague from New
    Orleans, Congressman Cedric Richmond, had planned to be with us
    today but had to go back to New Orleans for the funeral of a
    close friend. He asked that I submit his statement for the
    record. So if I could ask the committee to have that statement
    submitted, I think you all have a copy with you.
        I want to thank the committee for taking up our bill today.
    The RESTORE Act will ensure that the lion's share of the future
    Clean Water Act fines assessed on the responsible parties will
    be dedicated to the Gulf Coast States that were directly
    impacted by last year's oil spill.
        On April 20th of last year, the Deepwater Horizon exploded.
    Eleven men lost their lives. And when the Macondo well blew
    out, the largest oil spill in our country's history ensued.
        We continue to remember those lost in the disaster, and
    keep their families with us in our prayers. The events of that
    tragic day are still felt every single day by the families, the
    communities, and fragile ecosystems all along the gulf coast.
        Five million barrels, over two hundred and five million
    gallons. At its peak, the amount of oil per day that spilled
    from the Macondo well was about the equivalent of oil used by
    the entire State of Delaware each day. For 86 days, oil flowed
    into the Gulf of Mexico, not only devastating the ecosystems of
    the gulf, but also causing billions in economic losses across
    all five Gulf Coast States, shutting down small businesses and
    destroying entire industries for an extended period of time.
        On the third panel you will hear testimony from Mike
    Voisin, a seventh generation oyster harvester who will discuss
    how the gulf seafood industry, which represents a large portion
    of our domestic seafood supply, was essentially shut down for
    an entire season.
        In addition, when the Government imposed a moratorium on
    drilling in the gulf, even for those companies who played by
    the rules and that in no way were connected to the Deepwater
    Horizon disaster, thousands of energy and service industry
    workers from all across the country lost their jobs, and about
    a dozen deep water rigs left our country for places like Ghana
    and Egypt.
        Every day people along the gulf coast continue to deal with
    the effects of this disaster. And each story is unique. But one
    theme is constant, and one thing is clear: the recovery of this
    region will take well over a decade. And it is critical that
    this bill move forward, so that we are able to ensure that when
    the fines are eventually assessed and collected, that a
    mechanism is in place to ensure that those penalties return to
    the areas where the disaster occurred.
        As I mentioned, this bill has wide support, not just from
    members of the gulf, but also for Members of Congress all
    across the country.
        I want to particularly thank Congressman Don Young from
    Alaska for cosponsoring this bill, the RESTORE Act. He is all
    too familiar with the decades it takes to recovery from an oil
    spill. As the lead architect of the Oil Pollution Act of 1990--
    which is the legislation that actually imposes these fines we
    are talking about--in the wake of the Valdez spill, Congressman
    Young can attest to the importance of this legislation.
        We have also received wide support from a broad coalition
    of people and organizations in the business and conservation
    communities. And I would like to submit for the record the
    support from those organizations, Mr. Chairman.
        Mr. Gibbs. So ordered.
        [Letters in support of S. 1400 and H.R. 3096, the RESTORE
    Act, follow. Please see the ``Prepared Statements Submitted by
    Members of Congress'' section for the statement of Hon. Cedric
    L. Richmond, a Representative in Congress from the State of
    Louisiana.]

        Mr. Scalise. If we look at the Valdez spill in Alaska, what
    we know is that even now, more than two decades later, those
    communities and the ecosystems that were directly affected
    still haven't fully recovered. And many of those effects
    weren't seen until many years later. Just one example was the
    collapse of the herring fishery in Alaska. The failure of the
    herring to come back couldn't fully be anticipated for about a
    decade after the spill. And it is estimated that the loss of
    the herring industry alone has cost the region about $400
    million.
        The gulf coast will be dealing with similar restoration
    issues for more than a decade. And the ecosystems and resources
    of the gulf coast are of critical importance to our entire
    country. Thirty-three percent of the Nation's seafood harvest
    comes from the gulf. We produce 90 percent of America's total
    offshore oil and gas. And we are home to 10 of the Nation's 15
    largest ports.
        Last year's oil spill jeopardized these assets. And
    particularly in Louisiana, where we continue to lose a football
    field of our coast every hour, the effects of the oil spill
    exasperated the degradation of an already fragile ecosystem
    which supports the economy and resources all along the gulf
    coast which are so important to our entire country.
        As history has shown us, after the Valdez spill, the
    recovery of the gulf coast region will take years to
    accomplish. It is essential that Congress work to ensure that
    responsible party, not the taxpayer--and I think that is very
    critical to note in this, it is the responsible party, not the
    taxpayer under our bill--that will foot the bill for this
    disaster and the cleanup. And our legislation, the RESTORE Act,
    accomplishes that while making sure there is a mechanism in
    place that allows each State to respond to our unique recovery
    needs.
        This legislation enjoys bipartisan support, and I look
    forward to working with this committee to pass our bill. Thank
    you, Mr. Chairman, and I yield back.
        Mr. Gibbs. Thank you. I want to commend you, all five of
    you, for coming before the committee with your testimony, and
    making sure that the damage that was done to your constituents
    are made whole. And obviously, the economic vitality of the
    gulf coast region is very important to the rest of the country.
        So, thank you for being here. And you are excused, and we
    will take a break for just a few moments while our panelists
    for panel two can get to their seats.
        Our next panel, we have two panels of expert testimony. We
    have Mr. Craig Bennett, he is the director of the National
    Pollution Funds Center of the United States Coast Guard. And
    Mr. Tony Penn is the deputy chief of the assessment and
    restoration division, Office of Response and Restoration of the
    National Oceanic and Atmospheric Administration.
        Mr. Bennett, we will start with you. Welcome, and the floor
    is yours.

      TESTIMONY OF CRAIG A. BENNETT, DIRECTOR, NATIONAL POLLUTION
    FUNDS CENTER, UNITED STATES COAST GUARD; AND TONY PENN, DEPUTY
    CHIEF, ASSESSMENT AND RESTORATION DIVISION, OFFICE OF RESPONSE
           AND RESTORATION, NATIONAL OCEANIC AND ATMOSPHERIC
                             ADMINISTRATION

        Mr. Bennett. Good morning, Chairman Gibbs, Ranking Member
    Napolitano, and distinguished members of the committee. I am
    grateful for the opportunity to testify before you today about
    the RESTORE Act. My testimony will focus on how this act may
    impact the Oil Spill Liability Trust Fund and the liability and
    compensation regime established by title I of the Oil Pollution
    Act of 1990, open OPA90.
        Whenever there is an oil spill affecting U.S. waters, my
    role as the director of the NPFC is threefold. First, I fund
    the Federal oil pollution removal costs and trustee costs to
    initiate assessment of natural resource damages, using amounts
    Congress has made available from the Oil Spill Liability Trust
    Fund. Second, I ensure the response party adequately advertises
    its process for paying OPA90 claims for removal costs and
    damages. And, if claimants are not fully compensated by a
    responsible party, they may present their claims to the NPFC
    for payment from the Oil Spill Liability Trust Fund. Third, I
    recover costs from any and all responsible parties.
        With respect to the Deepwater Horizon spill, costs to the
    Oil Spill Liability Trust Fund for Federal removal activities
    and trustee costs to initiate the assessment of natural
    resource damages have totaled $616 million to date. In
    addition, the Coast Guard has incurred $272 million in removal
    costs that were not paid directly out of the Oil Spill
    Liability Trust Fund, but for which the responsible party is
    liable.
        As the responsible party, BP is advertising its claims
    process, and paying claims for damages that result from the
    spill. In general, claimants whose claims to BP or its gulf
    coast claims facility are denied or not settled after 90 days
    may present their claims to the NPFC for consideration. At the
    NPFC we have received more than 1,500 claims from individuals
    or businesses. The NPFC has paid one Federal trustee natural
    resource damage assessment claim in the amount of $1.4 million.
        To date we have sent the responsible parties 12 bills
    totaling $716 million in Federal costs, due to the Deepwater
    Horizon spill. Of these, BP has paid the first 11 bills in the
    amount of $712 million in full. We will continue to bill the
    responsible parties for all costs under OPA90.
        The RESTORE Act would, among other things, redirect 80
    percent of the civil penalties paid under the Deepwater Horizon
    responsible parties under section 311 of the Clean Water Act.
    Under the RESTORE Act, these redirected penalties could
    apparently be used for a broad range of ecological and economic
    restoration projects in the five Gulf States.
        The provisions of the RESTORE Act may impact the Oil Spill
    Liability Trust Fund and the OPA90 liability and compensation
    regime in two important ways. First, the Oil Spill Liability
    Trust Fund is financed, in part, from Clean Water Act
    penalties. The redirection of these penalties would, therefore,
    be the most direct impact of the RESTORE Act on the Oil Spill
    Liability Trust Fund. Second, there was a potential for
    overlapping funding by the Gulf Coast Restoration Trust Fund of
    activities that might also constitute damages for which a
    responsible party is liable under OPA90. Responsible party
    liability includes natural resource and other economic damages.
    This liability is an addition to the responsible party's
    liability for any Clean Water Act penalty.
        The potential for overlapping damage compensation could
    increase the burden on claimants when presenting OPA90 claims
    to establish that their claim damages have not or will not be
    compensated from the penalty amounts. The potential for
    overlapping damage compensation could also complicate NPFC cost
    recovery by providing the responsible parties with arguments
    that their penalty payments have been used to compensate the
    damages paid by the Oil Spill Liability Trust Fund.
        The Coast Guard looks forward to working with the committee
    on these very important issues. Thank you for the opportunity
    to testify today. I look forward to your questions.
        Mr. Gibbs. Thank you.
        Welcome, Mr. Penn. The floor is yours.
        Mr. Penn. Thank you, Chairman Gibbs and members of the
    committee, for the opportunity to testify on the natural
    resource damage assessment and restoration planning processes
    for the Deepwater Horizon oil spill as you consider H.R. 3096,
    or the RESTORE Act. My name is Tony Penn, I am the deputy chief
    of the assessment and restoration division in NOAA's Office of
    Response and Restoration. I appreciate the opportunity to
    discuss NOAA's trustee roles in the natural resource damage
    assessment process, also known as NRDA.
        NOAA and our co-trustees have been working tirelessly over
    the last 19 months to assess the ecological and human use
    impacts of the spill and to identify restoration opportunities
    in the Gulf of Mexico. My testimony today will discuss the
    damage assessment process in general, and the status of the
    Deepwater Horizon assessment and restoration.
        NOAA, along with our co-trustees, is charged with assessing
    and restoring natural resources and services injured by an oil
    spill. The goal of the assessment process is to determine the
    type and amount of restoration needed to compensate the public
    for injury to the natural resources. The trustees also assess
    the public's lost use of those resources, such as recreational
    fishing, boating, hunting, and swimming. The ultimate goal of
    NRDA is to implement a package of restoration projects that
    compensate the public for all the ecological and human use
    injuries. The NRDA process does not address private or
    commercial economic losses.
        Since the outset of the Deepwater Horizon spill, NOAA has
    worked with Federal and State co-trustees and responsible
    parties to assess the injuries to ecosystem resources of the
    Gulf of Mexico. NRDA studies have been conducted in almost
    every area of the regional ecosystem. These include science
    directed at measuring the exposure and ecological injuries to
    resources and habitats in the shoreline, nearshore, water
    column, continental shelf, and deep sea environments.
    Additionally, they include assessing impacts due to the acute
    and chronic exposures of the ecosystem to the released
    hydrocarbons and dispersants.
        Presently, our longest term studies consist of less than 2
    years of field observations and data, and analyses from that
    work are only now becoming available for synthesis and
    interpretation. Field studies are supplemented by toxicity
    studies that look at many permutations of exposure to oil in
    the laboratory, from fresh to weathered oil, and with and
    without dispersant. The unique ecosystem impact of this spill,
    especially among very long-lived organisms such as turtles,
    tuna, and mammals, means that long-term restoration monitoring
    will be central to any final restoration plan.
        Concurrent with the injury assessment, NOAA and the co-
    trustees are planning for and implementing restoration. To
    date, the trustees and BP have agreed to implement several
    emergency restoration projects designed to curtail further
    injury to resources. The trustees are also preparing an
    environmental impact statement which will identify a range of
    restoration alternatives that the trustees will consider to
    compensate the public for lost natural resources and services.
    On April 21st of this year, the trustees announced an agreement
    whereby BP agreed to fund $1 billion in early restoration
    projects. Public input on early restoration projects has
    already begun, and will continue through this year and into
    next.
        Natural resource damages are one element of liability under
    the Oil Pollution Act, or OPA, that address injury to,
    destruction of, loss of, or loss of use of natural resources.
    Other elements of liability under OPA include oil removal
    costs, real and personal property damages, loss of subsistence
    use of natural resources, lost Government revenues that may be
    recovered by the United States, a State, or a political
    subdivision of a State, lost profits and earnings capacity of
    businesses and individuals, and net costs of increased or
    additional public services--again, which may be recovered by a
    State or a political subdivision of a State.
        As stated in H.R. 3096, the purpose of the RESTORE Act is
    ``to restore the natural resources, ecosystems, fisheries,
    marine and wildlife habitats, beaches, and coastal wetlands of
    the Gulf Coast States, and to create jobs that revive the
    economic health of communities adversely affected'' by the
    events surrounding the Deepwater Horizon. Ideally, natural
    resource damages should address restoration of resources
    impacted by the Deepwater Horizon spill. The ecological
    restoration called for in the RESTORE Act could address chronic
    non-spill environmental conditions.
        The task of compensating the gulf coast residents and the
    larger American public for the impacts of the Deepwater Horizon
    spill is no small feat. The NRDA process under OPA provides a
    mechanism to mitigate the environmental impacts of the spill.
    And other provisions under OPA can address other types of
    impacts. The RESTORE Act is another opportunity to provide
    compensation in addition to OPA. The mechanisms by which the
    ultimate compensation is achieved should be clearly defined,
    and should consider provisions that currently exist under OPA.
        Thank you for allowing me to testify on the damage
    assessment and restoration process.
        I am happy to try and address any questions you may have.
        Mr. Gibbs. Thank you. I will start off the first round of
    questions for this panel. Mr. Bennett, I think currently there
    is, what, $2.3 billion in the trust fund. Is that correct?
        Mr. Bennett. That is correct, sir.
        Mr. Gibbs. Has all the cost that the trust fund has paid
    out, incurred--has been reimbursed from the responsible
    parties? What is the status on the reimbursements and your
    expenditure so far from the spill?
        Mr. Bennett. We have billed for not all the costs that have
    been incurred, it is an ongoing process of billing. But we have
    billed for $700 million of the Federal cost, which is probably
    80 percent of the cost incurred. And BP has paid all but one
    bill of $5 million that is pending payment.
        Mr. Gibbs. I am curious--before the spill, historical trust
    fund balance. What would be your historical number?
        Mr. Bennett. Well, the trust fund originally--they called
    it a billion-dollar fund. It originally had a cap at $1
    billion. And recently, when the tax was reenacted, the cap was
    lifted. So it has been growing from around--from under $1
    billion to the current state of $2.3 billion. So $2.3 billion
    is as big as it has ever been, right now.
        Mr. Gibbs. OK. What--I guess we heard in the testimony--I
    am a little concerned if these parties went bankrupt or
    insolvent, or if we had oil from a spill coming from the waters
    of Cuba, we could be liable for it and the trust fund could be
    really hit hard.
        So I guess for contingency plans, from an actuary
    standpoint, what do you think the trust fund balance should be
    at, for historic levels?
        Mr. Bennett. That is a great question, Mr. Chairman. For 20
    years $1 billion was clearly more than enough for anything we
    witnessed. But this was the first time we have had a Spill of
    National Significance since OPA was enacted. And in the wake of
    what has been called probably a $40 billion spill, it is hard
    to say what the right amount would be.
        What I can say is the more that is there, the less likely I
    would have to come to you to ask for supplemental funds, should
    we run out of money. But it is hard to put a number on that.
        Mr. Gibbs. OK. Mr. Penn, under this bill that is being
    proposed, would it be possible to use the penalty funds to
    finance restoration projects that are--responsible parties are
    also liable under the fund?
        Mr. Penn. So, in looking at the bill, that is one of our
    concerns, is could these monies, the Clean Water Act penalties,
    be used for restoration that the responsible parties would
    otherwise be responsible for. And so what we would like to see
    is that the responsible parties are--they fully pay for what
    they owe under the OPA natural resource damages provisions, and
    that, you know, these dollars that would be available under the
    RESTORE Act do above and beyond what the responsible party
    would be liable for under OPA.
        Mr. Gibbs. What role is the Gulf Coast Ecosystem
    Restoration Task Force playing in the NRDA process?
        Mr. Penn. Yes. So we have been coordinating very closely
    with the Gulf Coast Restoration Task Force, and I think we have
    talked with them over the past 16, 18 months now, about how we
    integrate the damage assessment with the work of that task
    force. And I think all along it was envisioned that the natural
    resource damage assessment would achieve restoration under its
    mandates, and then the gulf coast task force and their planning
    was to do restoration above and beyond what we would be called
    to do under OPA.
        Mr. Gibbs. OK. I will yield to the ranking member.
        Mrs. Napolitano. Thank you, Mr. Chair. To Mr. Penn, you
    indicated both the emergency and early restoration projects
    have been undertaken with financing from BP. Has BP been
    supportive of the effort? And can you talk more in depth about
    the benefits that this approach could conceivably provide?
        Mr. Penn. Yes, ma'am. BP has been cooperative. We are
    working on a cooperative damage assessment with them. As I
    mentioned, we are implementing a couple of emergency
    restoration projects--have already implemented. We are working
    on an early restoration plan to start using the billion dollars
    that they committed back in April.
        I think the--for this, for the RESTORE Act, a potential
    opportunity that doesn't conflict with what we are trying to do
    for natural resource damages and the ecological restoration
    that we are doing is--as I mentioned in my statement, NRD does
    not address economic or commercial impacts. And so, in the
    RESTORE Act there is discussion about using funds for promoting
    the seafood industry, promoting tourism, workforce planning,
    planning assistance. Those are the kinds of things that we are
    not--that is not part of what we do under the damage assessment
    process. And so I think that might be an area where, you know,
    you wouldn't have this question about are you letting the
    responsible parties off the hook for their ecological
    restoration responsibilities.
        Mrs. Napolitano. Who then would be responsible for being
    able to address those shortages, those impacts?
        Mr. Penn. I am sorry, who would be responsible for----
        Mrs. Napolitano. Right. If your agency does not handle
    those particular areas, who then would they be able to turn to?
        Mr. Penn. Those economic impacts? Yes. Well, so that is a
    good question. And, you know, as I mentioned, the Oil Pollution
    Act does have these other elements of liability for, you know,
    private claims, for Government claims. I suppose there could be
    resources there to address some of these issues----
        Mrs. Napolitano. Well----
        Mr. Penn [continuing]. But I don't know that that is
    happening.
        Mrs. Napolitano. Well, Mr. Penn, and that brings up an
    issue that if these people have no redress, because they can go
    to an agency and say, ``No, it is not our responsibility, it is
    somebody else's,'' but nobody knows who else, then those people
    are still left holding the bag for something they have no part
    in, the catastrophe.
        Mr. Penn. Yes, ma'am. And that is why I think that would be
    a fine use of the RESTORE Act, is to focus on that economic
    kind of recovery.
        Mrs. Napolitano. OK. Then the other question, then, the
    importance--what is the importance of the long-term monitoring,
    the damage assessment process? And is that type of monitoring
    covered under the Oil Pollution Act of 1990? And is there a
    timeframe limit?
        Mr. Penn. So monitoring is very important as part of our
    damage assessment process. We, as we are charged with making
    the public and the environment whole, we want to--first we have
    to implement the restoration that we think is going to be
    compensatory. We use the monitoring to make sure that that
    restoration is performing and basically meeting the
    requirements that we set out, so that the public does get back
    those resources and services.
        In the past, I would say, you know, monitoring has been on
    the order of 5 to 10 years, depending on the area, the kind of
    restoration that we are doing. I think in this case,
    restoration monitoring will be longer lasting. We expect that,
    as I mentioned, with some of these resources that are impacted,
    we may not see the effect of the spill on those resources for
    perhaps decades.
        So, as part of our restoration, we plan to do active
    monitoring to see that we are able to restore resources, and to
    see also if there isn't some latent effect that we might have
    missed in the early days of our assessment----
        Mrs. Napolitano. OK, but if this were to take, say, a
    couple of decades, as you are mentioning, would BP still be
    liable to be able to address those events?
        Mr. Penn. Yes. So what we would try and do, as part of the
    final restoration plan, the settlement or the court judgment,
    we would target funds that would come from BP for that long-
    term monitoring, as part of----
        Mrs. Napolitano. What is there in writing, or--and you can
    address, Mr. Bennett, if you wish--is there something somewhere
    that really holds BP liable for this extended period of impact?
        Mr. Bennett. Yes, ma'am. I can answer that question. Under
    the law OPA90 right now there are statute of limitations for
    the various kinds of damages. And the statute of limitations
    for NRD damages is 3 years from when the damage is known. So,
    in the case of NRD that is typically 3 years from the end of an
    assessment being done. And there is no limitation on when
    assessment can take place.
        So if, for example, a certain species showed a problem 10
    years from now and the trustees needed to start an assessment
    process and study and then come up with a restoration, the
    statute of limitation would all start from the end of that
    assessment. So there is basically no limit. And the
    responsible--BP would--and the other responsible parties would
    remain responsible, regardless of how long that took.
        Mrs. Napolitano. And they are aware of that?
        Mr. Bennett. Yes, ma'am. They are very aware of that.
        Mrs. Napolitano. Thank you. Then, Mr. Bennett, you affirm
    in your written statement that the direct impact of the RESTORE
    Act on the Oil Spill Liability Trust Fund would be--that it
    would redirect up to 80 percent of the amounts gathered through
    the Clean Water Act section 311 penalties. I don't think you
    mention that impact would be from the loss of the revenue to
    the trust fund. What would be the diversion of funds away from
    the Oil Spill Liability Trust Fund--threaten the fund's
    solvency in the short or long term? And would the fund be able
    to function in the future, much as it has over the past 30
    years? Long question.
        Mr. Bennett. That is a good question, ma'am. And the short
    answer is no, it would not affect the solvency. We typically
    get $10 million to $20 million a year in Clean Water Act
    penalties. So the amount that we are talking here is a very
    large amount relative to what, historically, has been there.
        But as the chairman pointed out, it is that much--our only
    point is that it will be that much less money that is there for
    future spills, and it is not our--I am kind of agnostic as to
    how much flows into the fund or doesn't flow, I just want to
    make sure people understand.
        Mrs. Napolitano. Well, Mother Nature doesn't count on the
    rules that we set.
        Mr. Bennett. Yes, ma'am.
        Mrs. Napolitano. So thank you, Mr. Chair, for the
    indulgence.
        Mr. Gibbs. Thank you. Representative Landry, you have
    questions?
        Mr. Landry. Yes, Mr. Chairman. Thank you. Is--Mr. Bennett,
    is it my understanding that you have some objection to 80
    percent going to the Gulf Coast States?
        Mr. Bennett. I don't have an objection, per se. I have an
    observation, if you will, that it potential--not about whether
    it goes to the States, but that the--the diversion of 80
    percent--the one concern is that that is less money that is in
    the fund for future spills. And the other concern we have is
    that the potential for overlapping issues with NRD--and I would
    just hope that we can work together to resolve the potential
    impacts of that, because it could complicate being responsive
    to a particular claimant down the road, and it could also
    complicate potential litigation in the future with ERPs, if
    there is overlap.
        Mr. Landry. So your recommendation would not be basically
    to direct that 80 percent to the States. Is that----
        Mr. Bennett. I don't have a recommendation, one way or the
    other, on whether there is 80 percent direction.
        Mr. Landry. Mr. Penn?
        Mr. Penn. NOAA and the administration support the goals,
    the objectives of the RESTORE Act, of directing a significant
    portion of the Clean Water Act penalties into gulf coast
    recovery and restoration.
        Mr. Landry. Well, here is the question. I mean ultimately
    you all work for the President, correct? And I mean do you all
    normally go against the recommendations of the administration?
        Mr. Bennett. No, sir.
        Mr. Landry. Well, the administration directly recommended--
    all of his panels directly recommended that 80 percent of the
    fines go to the Gulf Coast States. So what I am trying to get
    from you all is to just echo what the administration has
    recommended.
        So is that a fair assessment? Could you make that
    recommendation to us today, based upon what the administration
    has already recommended in their task force? I mean I would
    like to make sure that everybody is singing off the same
    hymnal.
        Mr. Bennett. Yes. It is a good question, Congressman. I
    don't think either of us are in a position to speak officially
    for the administration on----
        Mr. Landry. Wow, really?
        Mr. Bennett. We don't object--what we are trying to do is
    make sure the committee is aware of the implications of the
    bill, as written.
        Mr. Landry. Did you make--I mean--but evidently--I am sure
    the administration is aware of those implications, and
    evidently has made an executive decision that, you know what,
    those concerns--basically, directing 80 percent to those States
    trump those particular concerns. And I just again wanted to get
    everybody on the same hymnal.
        Mr. Penn. I guess I would, if I may, say that, again, NOAA
    and the administration support the objectives of 80 percent, or
    a significant percent, of the Clean Water Act penalties going
    to gulf coast recovery and restoration.
        I think the administration also shares the concern that we
    want to hold the responsible parties liable for what they are
    responsible for in restoration. We want to do the restoration
    that comes from the RESTORE Act in addition to what the
    responsible parties are required to do.
        Mr. Landry. OK, great. Thank you. I have another question
    for you. Mr. Bennett, in analysis that you have done to date,
    have you examined the impact on a State-by-State basis?
        Mr. Bennett. I am not sure I follow your question. When we
    get claims we analyze the merits of each individual claim, and
    it is a very fact-specific----
        Mr. Landry. I mean are you able to tell us, based upon the
    research and the study that you all have done throughout the
    gulf coast, if you can determine which States have had the
    greatest environmental impact, up to date?
        Mr. Bennett. Well, I have information on claims submitted
    and what GCCF reports and BP has--claims paid. I would have to
    defer to the trustees on the ongoing assessment of the
    environmental impact. I don't think that is a known quantity at
    this point.
        Mr. Landry. So you don't have the ability to determine if
    certain States had been affected disproportionately? Like Mr.
    Bonner said, you know, some States from an environmental
    standpoint and others from an economical standpoint.
        But, I mean, NOAA--to me, NOAA's main focus would be the
    environmental impact of the--you know, of each State. And so I
    am trying to determine whether or not you have the ability to
    say this particular area--it may not be a State, it may cross
    State lines--but this particular area was disproportionately
    affected, versus other areas of the Gulf of Mexico. I am just
    curious, based upon analysis that you all have made so far.
        Mr. Bennett. Yes, I can't say what is disproportionate.
    What I can say is we have--we can see what--the damages that
    are being paid, and what are being paid and compensated.
        Mr. Landry. OK. Thank you, Mr. Chairman. I yield back.
        Mr. Gibbs. Thank you. Representative Altmire.
        Mr. Altmire. Thank you, Mr. Chairman. Mr. Bennett, as you
    know, the Oil Pollution Act established finite caps for the
    emergency fund per incident expenditures and responsible party
    liability. And in light of the response and recovery costs for
    the Deepwater Horizon spill event, what is your opinion on
    whether these caps should be revised upward? And if so, by how
    much?
        Mr. Bennett. Congressman, that is a good question. We--it
    is hard to say if we will hit the cap. Certainly on removal
    costs, it doesn't appear to. That has kind of tapered off.
    There is ongoing response going on, but the costs of that are
    minor, in the scheme of things, for the removal actions.
        BP and the GCCF have paid out $7 billion to claimants
    already. Whether that is enough or not enough, we haven't paid
    a lot of damage money to individuals, businesses, or States.
        I think the big unknown is the NRD costs. And so far, BP
    has indicated--has paid some of those costs, and has put a
    billion dollars on the table to start early restoration. But it
    is a good question, because the amounts that are being talked
    about for NRD, if they were to come to the fund, would exceed
    the cap.
        Mr. Altmire. Now, under the RESTORE Act, which we are
    talking about today, the funds collected from the Clean Water
    Act penalties paid by BP and other responsible parties would be
    diverted from the Oil Spill Liability Trust Fund to a new Gulf
    Coast Restoration Trust Fund. This fund would then finance a
    wide range of environmental projects to restore natural
    resources affected by the Deepwater Horizon spill.
        However, under the natural resource damage assessments
    process, the same types of restoration projects could be
    supported by funds provided through a final NRDA damage
    settlement. Should the bill be amended to establish a clear
    demarcation between the types of projects funded through the
    NRDA and those projects funded under the RESTORE Act?
        Mr. Bennett. I think we would support--work to clarify the
    differences, and perhaps put a savings clause in or other
    mechanisms to help reduce some of the ambiguity about what
    might happen during cost recovery or claims adjudication
    downstream.
        Mr. Altmire. Mr. Penn, do you have a response also?
        Mr. Penn. Yes, sir. I think that would be a good thing to
    do, to make sure that is clear that we are not doing
    restoration with RESTORE Act funding, that that should be the
    responsibility of the responsible parties.
        Mr. Altmire. And lastly, still with Mr. Penn but I will ask
    both of you. If a responsible party were, in effect, to pay for
    an environmental restoration of the RESTORE Act, would this in
    any way affect how much that responsible party might later be
    liable under an NRDA settlement? Should the bill clearly keep
    these two processes separate for the purposes specifically of
    liability?
        Mr. Penn. Let me see if I understand. I think that if we--
    if a responsible party--funds from a responsible party goes to
    implement restoration, ecological restoration, and that is not
    brought by the trustees as part of the damage assessment
    process, I think they very well could, as we go to ask payment
    for our restoration claims under the damage assessment process,
    they could say, ``Look, this area has already been restored.''
        And again, I think that is why we have to be very clear
    about what is being done for the natural resource damages
    versus what would be done under the RESTORE Act.
        Mr. Altmire. All right. Mr. Bennett?
        Mr. Bennett. I would agree. I would add typically there is
    an NRD damage dollar amount assigned to the damage. And so, if
    it is not clear whether they were--the RPs were getting NRD
    credit for what was done under the RESTORE Act, then it is--if
    the trustees came and did something similar, it could be
    problematic in adjudicating that claim, because I have to be
    able to do cost recovery against those funds. And if the RP
    goes to court and says, ``I have already done this,'' and it is
    not clear what happened, I don't know how the judge would rule.
    So that is the kind of thing that we are concerned about.
        Mr. Altmire. Great. Thank you both.
        Mr. Gibbs. Representative Farenthold.
        Mr. Farenthold. Thank you very much, Mr. Chairman. I have a
    couple of questions, some just in general and some specific to
    the district that I represent, which is a large chunk of the
    Gulf of Mexico, including the Padre Island National Seashore.
        But I want to first start with the broad national concerns
    with Mr. Bennett. After the Deepwater Horizon spill, I think we
    became acutely aware that as a country we don't have enough
    science and technology designed to deal with these sort of
    events, whether or not they are the result of a spill, of a
    U.S. oil company or a company operating in U.S. waters or,
    worse yet, a company operating in the waters of Cuba or Mexico
    or in the Arctic and in other foreign waters.
        What is the Coast Guard doing with respect to that? Are you
    all spending some money there? What are you all doing?
        Mr. Bennett. Yes, sir. As you know, there are provisions
    under OPA, title VII, for R&D. And there are discussions about
    continuing research and development. And I can take a question
    for the record if there is a specific question you have with
    regards to that. But it is a topic of discussion within the
    administration.
        [Insert for the record from the U.S. Coast Guard follows:]

            The Coast Guard's Research, Development, Test, and
            Evaluation Program is currently executing four projects
            to enhance the Service's ability to respond to a Spill
            of National Significance:

             LThe first project is ``Response to Oil in
            Ice'' with the objective to develop equipment and
            techniques for detecting, tracking, and recovering oil
            in ice-filled waters. The Coast Guard has conducted one
            exercise in the Great Lakes region to examine the
            capabilities of existing equipment and plans to conduct
            another exercise in the Great Lakes region in fiscal
            year 2012.

             LThe second project is ``Recovery of Heavy
            Oil'' with the objective to develop the capability to
            detect and recover heavy oil on the sea/ocean floor.
            The Coast Guard has conducted some initial prototype
            testing and plans to conduct a field demonstration in
            fiscal year 2012.

             LThe third project is ``Detection and
            Collection of Oil within the Water Column'' with the
            objective to develop technologies that can detect and
            mitigate oil within the water column down to 10,000
            feet.

             LThe fourth project is ``Mobile Asset Tracking
            and Reporting'' with the objective to develop a
            flexible, interoperable communications and information
            system that will assist the Coast Guard, other
            Government agencies, first responders, and volunteers
            in responding to an incident of national significance.

        Mr. Farenthold. So how much did you all spend last year? Do
    you know that, off the top of your head?
        Mr. Bennett. I don't have those numbers handy, but I would
    be glad to get an answer back.
        [Insert for the record from the U.S. Coast Guard follows:]

            In fiscal year 2011, the Coast Guard obligated $1.9
            million in personnel and direct project costs for the
            four projects focused on enhancing the Service's oil
            spill response capabilities using fiscal year 2011 and
            previously appropriated funding.

        Mr. Farenthold. How much do you think you need for next
    year, I guess would be----
        Mr. Bennett. Yes, I am not----
        Mr. Farenthold [continuing]. The followup for that
    question, as well.
        Mr. Bennett. No, it is a good question, Congressman. But I
    am not an R&D expert. I would have to go back and get an answer
    for you.
        [Insert for the record from the U.S. Coast Guard follows:]

            Of the amounts appropriated in the Consolidated
            Appropriations Act, 2012, over $650,000.00 is currently
            allocated from the Coast Guard's Research Development
            Test & Evaluation appropriation Research and
            Development for initiatives focused on enhancing the
            Service's oil spill response capabilities.

        Mr. Farenthold. And are you aware of--are you all
    partnering with academic institutions and other folks with
    regard to that R&D?
        Mr. Bennett. Yes, sir. I--although I am not an R&D expert,
    I do know that the Coast Guard and other Federal agencies work
    with academic institutions on R&D projects, and try to get the
    local people involved, as well.
        Mr. Farenthold. All right. Mr. Penn, as a NOAA
    representative, obviously the science is important to you. The
    beaches that are in the district that I represent are pretty
    much considered to be the garbage dump of the gulf. The way the
    currents work, it is going to probably wash up on the beaches
    of Texas. It is a ongoing battle that we fight. And as I think
    back in history, the Ixtapa well in Mexico, it was years after
    that blow-out that the final effects were determined and, you
    know, tar balls were washing up for a great deal of time.
        I have got some concern with some of the time limits and
    cut-offs in this proposed bill. How sure are we in the science
    that there isn't just some huge plume there, waiting in the
    gulf, waiting to wash up somewhere? And you know, is there a
    time certain that we are going to say, ``All right, we have
    pretty much got this handled''?
        Mr. Bennett. Thank you. That is a very good question. I
    don't think there is a time certain. We are--under the damage
    assessment process, our intent is to study this until, you
    know, we are forced to bring a claim in a court. The United
    States Government has filed a suit last December, and now we
    are on a court schedule for when we will have to present our
    claim. Certainly we will study as much as we can and understand
    the impacts up to that point.
        But even after that, whether it is a court settlement or a
    court order, we would--again, as part of our restoration plan,
    we would want to have monitoring to see that there aren't
    latent impacts that we see some time down the road that--you
    know, in the settlement context, you know, we would look at a
    re-opener clause. You know, Exxon Valdez, that is something
    they are going through right now.
        So we are very concerned with your point, that we need to
    understand what has happened over time, the full length of time
    where there could be impacts, and get the public the
    restoration for those impacts.
        Mr. Farenthold. And I guess specifically I am concerned, in
    this act, if we are not careful in setting cut-off dates and
    deadlines, we are not going to be able to address the
    allocation of those resources, property.
        Let me go on and ask you another kind of broad national-
    significance question on R&D and how this is handled. My--the
    way I look at it, I am afraid we are going to be setting up a
    bureaucracy. I think we have already got seven or eight
    agencies involved in this, as well as the individual States.
        So I guess my first question would be do you have any
    suggestions on minimizing that bureaucracy and increasing the
    efficiency of how this is dealt with?
        Mr. Penn. So with respect to the natural resource damages,
    we are working as a larger group. I mean we have a couple of
    Federal interests, we are working with all the States, the five
    Gulf Coast States. And, you know, I have to say I think it is
    one of the successes of what we have done to date, is that we
    have worked together, we have a trustee council that is
    shepherding us through the decisions that we need to make,
    working through the early restoration process.
        But you are right. It is a number of agencies and people
    that we have to coordinate. But I think we have done well with
    respect to the broader damage assessment process. I think--you
    know, you asked about research and development. Our office, our
    particular office, the Office of Response and Restoration,
    would like to have some sustained focused effort on some of our
    oil spill response and damage assessment needs. And so if that
    focuses for our particular needs, we are supportive of that.
    You know, going through the Coast Guard may be another way of
    getting some of this important research done.
        Mr. Farenthold. I see I am out of time. Thank you very
    much.
        Mr. Gibbs. Representative Southerland. Questions?
        Mr. Southerland. Thank you, Mr. Chair. I would like, if I
    could, to ask that three different reports from Federal task
    forces be submitted into the record.
        Mr. Gibbs. So ordered.
        Mr. Southerland. Great. Thank you very much. One of the
    things, as a Member--I live in Panama City, Florida. So this
    morning Representative Miller sat on the panel to talk about
    the interest of Florida. But I was fortunate enough to work
    with our spearhead, Mr. Scalise here, in the forming of this.
    And I had, clearly, great concerns. But not only do I feel that
    we have the responsibility to legislate here regarding this
    incident, the Deepwater Horizon, I lived through it, because my
    community is on the Gulf of Mexico, and I have nine coastal
    counties.
        One of the things that I want to make sure--because we keep
    talking about restoration and restoration, and as we talk about
    the RESTORE Act both in this committee and any other committee
    of oversight, I want to make sure that those of us who worked
    on the committee, especially those in Florida, recognize that
    there is a balance between the environmental damage and the
    economic damage.
        Now, I know we are going to have another panel after this
    one that will delve into that. But I am fortunate enough, you
    know, because of--Mr. Farenthold talked about the currents. We
    benefit from those currents, even though he is hurt by those
    currents, because I live on the Emerald Coast. It has the
    prettiest beaches in the world. So you know, we--our damage was
    economic.
        And so, when we talk about restoration, I would just ask
    all Members that are in attendance, and those that are perhaps
    watching this hearing to expand the definition and the purpose
    of restoration beyond environmental. It seems like every
    question here today has been focused on environmental. And I am
    telling you that I represent those nine counties. And how the
    effect of that wave of that economic damage went northward, we
    must also understand that there was significant economic damage
    to the small businesses. Thus, those economic damages continued
    to compound into the local and State governments that--and the
    cities that we live in.
        So--and the environmental cost--or, excuse me, the
    opportunity cost. It wasn't just the actual cost or loss of
    dollars, but it is the opportunity cost of what those dollars
    that weren't there prevented us from doing to better the plight
    of our citizens.
        So that was just a comment. I didn't get a chance this
    morning, because there wasn't room on the panel, but thank you
    for submitting for the record these reports. And I yield back.
        Mr. Gibbs. Thank you. That is our questions for this panel,
    but I just wanted to make a couple comments----
        Mr. Young. Mr. Chairman?
        Mr. Gibbs. Oh, I am sorry. Mr. Young.
        Mr. Young. Just don't forget me. You know, I used to sit in
    that chair. How time flies.
        I just want to make--I do support this legislation. The
    gentleman is absolutely right, that the lack of results to the
    economic loss to a lot of our small communities in Alaska--I
    lived through this. And my biggest concern is some of the money
    that we filed against Exxon--it took us a long time to get that
    money to us--I think was misused, not for the communities. We
    made a big mistake because we set up an organization that
    supposedly was to address some of the economic issues, but
    mostly environmental issues, and they ended up buying land,
    private land. That was not the appropriate thing to do.
        So, OPA wasn't perfect. I worked on that legislation. And I
    would like us to look at OPA. I think this is part of the
    solution. Mr. Scalise, I thank you for this legislation to make
    sure that the communities--because we hear a lot about the
    environment.
        If we leave God alone, the environment will do what it
    should do. And we will probably mess it up. And a lot of the
    areas in Alaska now, we ``cleaned the environment up,'' we
    killed the environment. We have dead areas where we use hot
    steam and soap and all that sort of thing. And we should have
    left it alone. We go out to muddle around in the bayous,
    cleaning up stuff that you know and I know that is natural to
    begin with, then we have a challenge to ourselves. Because are
    we doing better? I don't think we are.
        But the people that live there, yes, maybe they will get
    some money if they have a few claims to file. They may get some
    back, I don't know. Some of them rejected, probably rightly so,
    but maybe not. But we got to look at the total economic package
    of the coastal States, and the effect upon it. And communities,
    small and large, were hurt. The money that comes from the so-
    called fines should not just necessarily go to the Government.
        Now, I do believe the trust fund should be re-established,
    Mr. Chairman, and to a point where there is enough money when
    something does occur. I do believe that very strongly. But
    let's not forget those individuals. And I think this bill here
    has got great merit. It may have some mistakes as far as, you
    know, setting precedent--I don't believe in precedent, by the
    way. Everybody says precedent. The precedent is set here in
    Congress, it is not set into law.
        And so, I do congratulate the gentlemen and those from
    coastal States who understand what they are going through and
    what their communities are going through.
        So, Mr. Chairman, as we go through these hearings and find
    out why and yes and no, let's get a little broader mind.
    Because when we passed OPA, it was the first time we had ever
    had an incident like this. And I take great pride in that bill,
    although I don't think it is perfect. I think we ought to build
    on that bill with this bill, and we will solve the problem.
    With that, Mr. Chairman, I yield back.
        Mr. Gibbs. Thank you. And I want to thank the panel. I do
    want to make a quick comment. As an outsider from the gulf
    coast region, I think as an American taxpayer, all taxpayers,
    we are thankful that the parties involved in this disaster have
    had the resources to make restitution and not put the hook on
    American taxpayers.
        So thank you for being here, and the committee will be at
    ease while we excuse this panel and bring up the third panel.
    Thank you.
        Mr. Landry. [presiding.] The hearing will be in order. I
    would like to first introduce our first--first one to make
    comments would be Mr. Julian MacQueen, chief executive officer
    of Innisfree Hotels. Mr.--I know you got a flight to catch, so
    Mr. Graves was kind enough to let you go first. So that is kind
    of why we are working a little bit out of order. So you have 5
    minutes, sir.

        TESTIMONY OF JULIAN MACQUEEN, CHIEF EXECUTIVE OFFICER,
     INNISFREE HOTELS, INCORPORATED; GARRET GRAVES, CHAIR, COASTAL
    PROTECTION AND RESTORATION AUTHORITY OF LOUISIANA; HON. ROBERT
      CRAFT, MAYOR, CITY OF GULF SHORES, ALABAMA; BILL WILLIAMS,
    COMMISSIONER, GULF COUNTY, FLORIDA; ROBERT H. WEISBERG, PH.D.,
        PROFESSOR OF PHYSICAL OCEANOGRAPHY, UNIVERSITY OF SOUTH
      FLORIDA; AND MICHAEL C. VOISIN, MOTIVATIT SEAFOODS, HOUMA,
                               LOUISIANA

        Mr. MacQueen. Well, thank you very much, Mr. Chairman and
    members of the committee for inviting me here today to share my
    experiences with the most damaging economic disaster to take
    place in the United States since the Three Mile Island nuclear
    meltdown in 1979.
        I have been in the hotel business all my life, starting as
    a busboy in the Fort Walton-Destin area at 15 years old, and I
    founded Innisfree Hotels 25 years ago with the development of
    an 88-unit hotel in Mobile, Alabama. I spent every cent I had
    to open the hotel and to develop the property and to hire my
    staff. My initial guests actually had to make their own beds
    until I had enough money to pay the housekeeping staff.
        Today, Innisfree is the largest hotelier in the Florida-
    Alabama gulf coast area, and the largest employer and taxpayer
    on Pensacola Beach. We own and operate 12 properties with 1,640
    rooms and condominium units in Florida and Alabama. We employ
    800 people in the peak season and 625 people in the off season.
    We have a combined payroll in excess of $12.5 million. We pay
    in excess of over $2 million annually in lodging and sales
    taxes. And we pay in excess of $3.2 million annually in real
    estate taxes and lease fees.
        Our beachfront resort hotels in Orange Beach, Alabama, and
    Pensacola Beach, Florida, were at the epicenter of the BP
    Horizon oil spill that hit the Alabama-Florida beaches. I was
    attending a hotel owners conference when the news broke out of
    the explosion and the spill, and immediately rushed home to
    implement our disaster preparedness program.
        Those of us who live on the gulf coast are well experienced
    with natural disasters. For example, I lost seven hotels in one
    night during Hurricane Ivan in 2004. And one of those
    properties was the first to open up after the hurricane passed.
        But nothing I had experienced prior prepared me for the oil
    and the Corexit dispersant that drifted unabated from the
    spill. This toxic brew fouled our waters and blanketed our
    formerly pristine white sugar beaches with a thick oil and
    weathered tar balls. We watched with amazement, as did the
    world, at the lack of a plan from BP to control the spill, and
    later to clean up our beaches.
        Cleanup efforts were initially undertaken by people in blue
    jeans and tee shirts who raked and shoveled the sludge into
    bags wearing no safety clothing. It evolved painfully slow over
    weeks of experimentation to finally teams working in hazmat
    suits with sophisticated digging and sand and oil shifting
    mechanical equipment. The airborne fumes from the oil in our
    waters was so strong that it burned the eyes and the lungs, and
    our hospital emergency rooms treated 100 percent more
    respiratory problems in July of 2010 over 2009.
        We have had many major oil mats shifting, sitting on the
    oil of--the floor of the gulf, just off our beaches, that even
    the smallest storms wash ashore. Presently, our beaches need
    constantly cleaning and renourishment.
        This disaster could not have come at a worse time,
    economically. We had just suffered through 2 years of
    recession, and through the first 4 months of 2010 we were
    bracing for a record year. Unfortunately, however, while the
    rest of the Nation enjoyed a record summer, we enduring the
    trauma of a season without any tourists.
        We make 70 percent of our money in the summer. And this hit
    just 1 month away from the commencement of our peak season. It
    was much worse, economically, than a hurricane, which typically
    hits at the end of the summer or early in the fall, after the
    hotels and our seasonal employees have made the money they need
    to carry themselves through the winter.
        The phones stopped ringing as soon as the oil spill
    occurred and the people watched the oil 24 hours a day, 7 days
    a week, gushing to the gulf and floating our way. Our hotel sat
    at the epicenter of the spill coming ashore on the Alabama and
    Florida beaches. And the media coverage went on and on.
    National TV networks set up live broadcasts from our Hilton
    Hotel on Pensacola Beach, and I was interviewed by everyone
    from Sam Champion to Joe Scarborough, and from the Wall Street
    Journal, even to Al Jazeera. Our beaches were black from oil.
    The negative publicity was overwhelming and relentless.
        I went into a deep depression, thinking I had lost
    everything I had worked for my entire life. And there was
    nothing I could do about it. I have quantified--we have
    quantified that the negative free media exposure from May to
    December 2010 for just Pensacola Beach alone had an advertising
    equivalency in excess of $90 million. This is negative
    publicity.
        We survived by cutting staff and expenses to the bone from
    day one of the spill. Hundreds of conscientious, hard-working
    employees were denied work in those prime summer months from
    which they made their primary earnings for the year. We were
    favorably surprised when BP stepped up and started immediately
    funding emergency payments. We can argue over the methods, and
    whether or not everyone had been completely made whole by the
    BP claim process. But we cannot argue over the godsend of that
    initial payment.
        But I cannot stress enough that the long-term impacts of
    this disaster are not over. We have documented that many of our
    historical core customers have not returned to our hotels. For
    example, our Pensacola Beach Hilton Hotel has lost over 50
    percent of the premium Hilton Honors guests. These are premier
    travelers who stay--who can stay anywhere on the points that
    they earn on their travel points program. The core geographic
    market from which our guests come have changed.
        We know that over 50 percent of the gross revenue increase
    in 2010 over 2009 from our Pensacola Beach Hampton came in from
    95 markets from which we have never had a guest, while the
    number of guests from our traditional markets have declined.
    Many of our core customers went to other locations and have
    never returned. We know that some of our customers went to
    Myrtle Beach, for example, which had a remarkable summer in
    2010.
        Along with--although the region was blessed with an above-
    average summer this year, we remain very concerned that it is
    not sustainable. This increase, which did not come from our
    core customers, was primarily driven by advertising grants to
    local communities by BP. A very sophisticated BP Web site and
    social media campaign involving Facebook, YouTube, Twitter, as
    well as $170 million BP spent in national advertising and
    promotion has helped us recover somewhat for 2011. Our
    convention and visitor's bureaus received three grants in
    excess of four times their normal operating budgets. And our
    guests increased. BP continues to operate a very sophisticated
    Web site and social media campaign, encouraging people to come
    for visits.
        Full economic and economic recovery of the gulf coast is
    directly tied to the use of monies received from the fines paid
    by BP for the barrels of oil they spilled. We still need
    beaches cleaned and renourished. We still need better
    preparedness plans by the oil companies working with the
    Federal, State, and local governments. We still need more
    research and better methods involved in the identification and
    removal of oil mats in the gulf before they come to shore. We
    still need more research and a better understanding of the
    long-term impact of our seafood, its ecosystems, and our
    wetlands. And we still need significantly greater marketing and
    advertising dollars.
        In conclusion, I urge you and your colleagues to support
    the Restoration Act. Our States, our counties, cities, and
    convention and visitors bureaus need these funds as soon as
    possible, and with the greatest flexibility, in order to
    maximize their effect, based on local needs. I urge Congress
    and the administration to make sure that the funding from this
    legislation benefits the full range of economic and
    environmental recovery efforts, such as tourism, ecotourism,
    tourism-related economic development, the gulf waters, seafood,
    and wetlands.
        Thank you again for this opportunity to share my story.
        Mr. Landry. Thank you, Mr. MacQueen.
        And now Mr. Garret Graves, the chair of Coastal Protection
    and Restoration Authority of Louisiana, someone who I have a
    tremendous amount of respect for, and understands coastal
    issues, regardless of whether you are in Louisiana or along the
    gulf coast.
        Mr. Graves.
        Mr. Graves. Congressman Landry, Congresswoman Napolitano,
    thank you very much for the opportunity to be here today. It is
    a good seat for you, sir.
        I want to thank Congressman Scalise for introducing this
    bill. But I think it is unfortunate that we have to be here
    today under these conditions, in response to the Deepwater
    Horizon oil spill.
        The Deepwater Horizon oil spill caused extraordinary
    impacts to the gulf coast. Nearly 1,100 miles of the gulf coast
    and all five Gulf States were oiled. Approximately 75 percent
    of the heavily and moderately oiled shore lines were in the
    State of Louisiana. Further, in the State of Louisiana we have
    had over 300 marine mammals such as dolphins, whales, and other
    species that have washed up on our shore lines and have been
    found oiled with fingerprint from Deepwater Horizon since the
    beginning of this oil spill.
        Just last month, Mr. Chairman, we removed 1 million pounds
    of tar mats from one beach in your congressional district that
    were previously unknown to exist. This oil spill is very live,
    very real, and very much impacting--continuing to impact our
    citizens today.
        This oil spill compounded the extraordinary impacts from
    the hurricanes we have had along the gulf coast. In the last 7
    years we have had--as I recall, I believe it is six of the most
    disastrous hurricanes in our Nation's history in regard to
    property damage. And this oil spill has compounded those
    efforts.
        It is important to recognize that the gulf coast is
    fundamentally different from many other coasts in the United
    States. The gulf coast is a working coast. Mr. Chairman, I know
    you are aware that the five Gulf Coast States cumulatively
    represent the seventh largest economy in the world. The gross
    domestic product from those five States represents
    approximately $2.5 trillion. Fifty-four percent of the Nation's
    oil, fifty-two percent of the Nation's natural gas, forty-seven
    percent of the Nation's refining capacity, and nearly fifty
    percent of all international commerce comes through our gulf
    coast through our port facilities, where 13 of the top 20 ports
    in the Nation are represented.
        In addition to that, on an annual basis, approximately 1.4
    million pounds of commercial seafood landings come from the
    gulf coast. It is one of the most productive estuaries in the
    world, and certainly the most productive in North America.
        Mr. Chairman, this area is absolutely vital to the Nation.
    Even on the recreational fishing side, about 31 percent of the
    recreational fishing trips in the United States occur on the
    gulf coast. And those anglers are so good that they bring in
    about 44 percent of the recreational fishing landings in the
    United States.
        The RESTORE Act is designed to fulfill recommendations of
    Secretary Mabus that was appointed by President Obama to
    develop a long-term recovery plan. It is designed to fulfill
    recommendations by the National Oil Spill Commission that was
    appointed by the President and had bipartisan leadership and
    former Senator Graham of Florida and former EPA administrator
    under President Bush, Sr., William Reilly. It was designed to
    response to the Gulf Coast Ecosystem Restoration Task Force
    recommendations that recommended that these funds be returned
    to the gulf coast. And it is responsive to comments by the
    President, who endorsed, as you noted earlier, Congressman, who
    endorsed the concept of returning these dollars to the gulf
    coast.
        I heard comments earlier regarding--and perhaps confusion--
    regarding the fact that this bill perhaps would cause an
    overlap through existing remedies that are provided under the
    Oil Pollution Act in 1990. And I want to clarify some
    statements that were made there that I think are very, very
    important for folks to recognize.
        Number one, if these were duplicative or overlapping
    penalties if they were returned to the States, or if this was
    an overlapping remedy, why would they have been included in the
    same legislation? Why would the responsible parties be asked to
    pay both NRDA, economic, and these penalties, if they are
    overlapping or duplicative? These were done in the same year.
    These were all done in 1990 in the OPA bill. These are not
    duplicative. These are absolutely complementary penalties that
    are deterrents from causing environmental damages. I think it
    is important to keep that in mind. They are in the same
    statute. And so, if anyone would call those duplicative, I
    think that the Congress should review that. But certainly that
    is not the perspective of the State.
        Number two, and perhaps the strongest point, Mr. Chairman,
    is that if these funds are not returned to the Gulf States,
    that means that the Federal Government profits from these funds
    from the responsible party. Why should the Federal Government
    profit from the gulf coast loss? I don't think that is an
    appropriate policy approach. The Clean Water Act fines are
    complementary to the NRDA process. They are complementary to
    ecological restoration, and they supplement that process. They
    don't replace; they are in addition to.
        Lastly, Mr. Chairman, the Clean Water Act is an
    environmental statute. These fines are environmental-related.
    They are based upon volume of oil. They are based upon the
    impact that oil caused. And I think that these fines should be
    returned, based upon these environmental impacts, as the spirit
    of the legislation--excuse me, of the law--intends.
        I also heard, Mr. Chairman, that the redirection of these
    funds could cause gaps in the Oil Spill Liability Trust Fund,
    and I heard some very disturbing comments related to that. The
    Oil Spill Liability Trust Fund is designed to be a gap filler.
    It is not designed to be the bill payer for oil spills. Just
    like when I go drive a car, I have to have car insurance. And
    just as an operator is out there producing energy in the Gulf
    of Mexico, they should not be producing without the financial
    resources to address disasters such as a spill. And the trust
    fund was never set up to be the sole bill payer.
        Billions of barrels of oil, trillions of cubic feet of
    natural gas have been produced in the Gulf of Mexico without a
    spill. This spill was an anomaly. And based upon some of the
    analyses that have been done, there appears to have been gross
    negligence on the part of the operators, and it appears that
    perhaps oversight activities were not as robust as they should
    have been.
        I think it is important to recognize the comments that the
    director of the NPFC made on the second panel. He said that the
    balance of the trust fund today is the highest it has ever
    been. And this legislation does not take all of those funds. It
    does provide, under a worst case scenario, an additional $1
    billion, increase in the balance of the trust fund by 50
    percent, and perhaps increasing the balance of the trust fund
    by over 200 percent of its existing balance. And it could be
    more.
        The RESTORE Act--and this is another, I think, issue that
    was confused in some of the statements made earlier--the
    RESTORE Act simply improves upon the existing process known as
    SEPs, supplemental environmental projects. This is a
    fundamental component of virtually all settlements that are
    administrative settlements or judicial settlements. These
    projects are included in settlement negotiations with the
    responsible parties. They exist today. It has been happening
    for several years, hundreds of cases in all EPA regions include
    supplemental environmental projects. And in effect, what this
    legislation does is it takes the decision for how those funds
    are spent away from the responsible party, and gives it to the
    public, to the State governments, to the local governments, and
    to the Federal agencies that are responsible for the trust
    resources.
        Mr. Chairman, I think that is really important to
    recognize, that this is not a--that this is simply improving
    upon the current supplemental environmental project process.
    And I don't think that we should discriminate against the gulf
    coast by taking that away.
        Finally, Mr. Chairman, I want to note on the behalf of
    Louisiana that the State is committed to investing these
    resources and resiliency efforts to help ensure the resiliency
    of coastal Louisiana against future hurricane damages and
    future disasters, to help ensure that the gulf coast may
    continue to be an extraordinary component of this Nation's
    economy.
        Thank you, Mr. Chairman. Be happy to answer any questions.
        Mr. Landry. Thank you, Mr. Graves.
        Next, Mayor Robert Craft from the city of Gulf Shores,
    Alabama. You have 5 minutes.
        Mr. Craft. Mr. Chairman and members of the committee, thank
    you for inviting me to testify today. First, let me state again
    how much the coastal residents along the Gulf of Mexico
    appreciate your interest in our region, as you consider the
    RESTORE Act. I believe the RESTORE Act contains requirements
    for eligible spending, which will ensure the American taxpayer
    an annual return on this investment.
        As mayor of Gulf Shores, Alabama, a coastal city located
    directly on the Gulf of Mexico, we work closely with our sister
    city, Orange Beach, to support and enhance a dynamic beach
    tourism industry. In 2009, we hosted 4.6 million visitors on
    just 32 miles of sugar white sand beaches. This provided direct
    spending of over $2.3 billion, creating over 40,000 tourism
    jobs.
        In the pre-spill first quarter of 2010, our lodging tax,
    the only accurate measure of tourism performance, was up 17
    percent in Gulf Shores alone, indicating the promise of a
    record year. If two cities in one county with only 32 miles of
    beaches and in just one of the gulf's many industries had this
    much at risk, consider the cumulative threat to the thousands
    of miles of gulf between Florida and Texas.
        Ports along the coast struggled during this time to deflect
    the assumptions by many that they would be closed to traffic.
    The export-focused ports along the gulf coast are important to
    many sectors of the U.S. and local economies. Add to that the
    billions of dollars and thousands of jobs created by the gulf's
    oil and gas industry, as well as the commercial seafood
    harvesting and processing industry, and you understand the
    value of the coastal gulf to the Nation's economy.
        On April 20, 2010, with the tragic events resulting in the
    Deepwater Horizon accident, our world changed, most probably
    for years to come. All of our gulf-related industries came to a
    halt. Areas of the gulf were closed to all activities.
    Vacations were canceled, jobs were lost, and many small
    businesses with generations of history closed.
        As the oil spread throughout the gulf, so did the impact on
    the entire gulf economy and reputation. In South Baldwin County
    alone, tourism dollars in July, our busiest month, were down
    nearly 70 percent. Also in July, when large areas of gulf
    waters were closed, our seafood landings were down an
    unbelievable 97 percent. Surveys confirmed that 75 percent of
    people nationwide had significant concerns regarding the safety
    of gulf seafood. Those safety concerns, along with major
    reputational damage for the entire gulf, resulted in many lost
    customers and business failures.
        2011 was a much better year for our coast. Tourism and
    seafood were beginning to recover. But we all must understand
    why. BP funded $179 million in tourism grants and commitments.
    BP also funded $72 million for seafood testing and additional
    marketing. In addition, BP spent untold millions on protecting
    their brand and promoting their reputation with broad media ads
    touting the recovery and safety of the beaches and seafood.
    This dramatic increase in marketing is the main reason we had a
    good 2011.
        2012 and beyond remain a serious question, since no such
    commitments from BP exist, going forward. When BP leaves, the
    future is up to us. And there are still many unanswered
    questions. As analysis continues on the safety of our gulf, we
    wonder. Will there be any future unknowns that affect the
    marketability of our products? Will the oil or dispersants
    destroy our juvenile population of seafood? Will our small
    businesses and fishermen survive? The businesses that are still
    here--and many aren't--have seriously depleted reserves. This
    loss of reserves, combined with damaged access to credit and
    any future impact, be it more spill effects, further economic
    downturn, or a tropical weather event--and we will certainly
    see more businesses close.
        The entire gulf coast economy faces a continued threat from
    providing the energy resources that the Nation demands daily.
    But even with this exposure, which has a magnitude that we now
    all grasp, I believe the majority of us on the coast completely
    support continued safe drilling in our gulf, and encourage
    aggressive efforts to create energy independence for our
    country.
        All we ask is that, as those who are negligent are fined,
    the fine money be directed to the coastal economies that were
    damaged. This will allow us to recover and to continue to
    generate tax dollars each year to the benefit of all Americans.
    The RESTORE Act contains strict requirements for eligible
    spending. These appropriate restrictions will ensure the
    American taxpayers will receive an annual return on investment.
        There is no doubt that the gulf coast is of vital national
    importance. The ports, the seafood industry, the energy
    industry, and tourism all provide benefits to the entire
    country. It is absolutely in the Nation's interest to ensure
    that the gulf coast is able to boost its resiliency. Thank you,
    sir.
        Mr. Landry. Thank you, Mr. Mayor.
        The next panelist will be the Honorable Bill Williams, Gulf
    County, Florida.
        Mr. Williams. Thank you, Mr. Chairman. On behalf of
    Congressman Mica, and certainly yourself, as the chair, I
    appreciate the opportunity. My name is Bill Williams, and I am
    a Gulf County commissioner of a small county located near
    Panama City in Apalachicola, less than 20,000 people. But I am
    also the president-elect with the Florida Association of
    Counties, so I have the opportunity to work with all 67
    counties in the impact to our State, and as a system.
        I have a script that is here, and you all can read with it.
    I think the issue here is that we don't need a script. I
    certainly don't, because we lived this for 2 years, and in the
    process. I have testified in front of Congressman Issa with the
    Oil Pollution Act responsibility, and how we have been
    paralyzed.
        If I could take the picture that we have all heard today--
    and my congressman, Steve Southerland and Congressman Miller
    have hit it right on the head--this is about giving us a chance
    to pull back in. This is not a handout. This is not moving
    dollars that should be shifted back into the trust funds there.
    These five States were grossly impacted by the acts and
    negligence of others. We have been held, from the very
    beginning as local officials, paralyzed by OPA.
        Congressman Young hit it very clear to me a moment ago. It
    was what they had at hand in 1990. And there were certainly
    excellent opportunities and things written in that. We have to
    make the changes that make us whole. The folks that I sit
    beside and the folks that are working, everyone is working
    hard. We have got different trust funds, trustees, everyone
    working. But what I want you guys to--and ladies--to understand
    is that it is so fragmented.
        Right now, for example, in the NRDA process, if you look at
    what is happening within our States, each State received $100
    million, each State has a trustee that has the ability to
    overlook it. And they are doing yeoman's work on that process.
    As a local official in the State of Florida, we have sunshine
    laws where everything is accountable and transparent. I cannot
    look at what those NRDA projects are behind the scenes, because
    of confidentiality agreements with BP. To me, that is not
    acceptable in the process.
        What I ask this committee to do is we understand--I can sit
    here and tell you the oystermen in Franklin County, their
    resources, their ability to make a living were devastated. You
    have heard this from the different Members that are here. I
    have an aquatic level one preserve in my county with scallops,
    one of the few areas in it. As Steve indicated, he has got
    different counties with coastal areas. This is about economics.
    And you do hear a lot about the issues of the different States.
    Louisiana, by far, took it on the nose on the environmental
    side. My State took 2 million pounds of product in Escambia
    County, 400 pounds of product in my county. We have product.
    And if we had the last tropical storm--I am still getting tar
    balls and tar mats that are coming there.
        So, I think I would ask this committee to understand that
    there is a balance between economics and the economy that we
    have got to do. These funds and this transfer of dollars,
    instead of going to the general trust fund, will empower and
    allow our folks to come in.
        President Obama sent in the Chamber of Commerce I would
    probably say maybe, I don't know, 6 months into the event. They
    did excellent work, drilling down into the counties that I
    serve with. But I don't know where that data went. How are we
    going to take that template and show that there is no
    redundancy on the environmental and on the economic side?
        But this is an opportunity to put our citizens back to
    work, protect our shores, and have best practices that never
    happen again. So I ask that you hear our hearts, as much as our
    dialogue, and the fact that we were paralyzed. We do need best
    practices to review. OPA needs changes in the process that
    occur. We need these dollars to make sure that the research is
    done.
        All of the services and all of the academia and all of the
    research is very fragmented. There is no central clearinghouse
    where we, as non-scientists, can make interpretations and give
    to our citizens where things are. I hear reports of fish with
    skin lesions, or I hear the shrimp industry is not there. I see
    what it is. We need your support in bringing all those academic
    and scientific--to come to us, where we can make decisions and
    work with the oil industry to have best practices and change
    OPA, that local officials are never empowered.
        But as my congressman said, and certainly Congressman
    Miller, the economics cannot be forgotten here.
        And I appreciate your time, Mr. Landry, to allow me to
    speak from a local perspective, because I think it is critical
    that you are our partner, the State is our partner. I have got
    a Governor that wants to move jobs. And we need your help to be
    able to do that.
        Mr. Landry. Well, thank you. And I can tell you--I sit
    right next to your congressman on both this committee and in
    Natural Resources. And this is something that is very important
    to him. And I believe that he is committed to fulfilling
    everything that you requested here today.
        Mr. Williams. Thank you, sir.
        Mr. Landry. Next we will have Dr. Weisberg, University of
    South Florida.
        Dr. Weisberg, you have 5 minutes.
        Mr. Weisberg. Thank you. Honorable committee members and
    guests, it is my privilege to comment today on H.R. 3096. My
    testimony will be somewhat different, because I am going to
    focus on the Gulf of Mexico, itself. I guess I am going to
    focus on the 5 percent of the bill, instead of the 95 percent
    of the bill.
        While the Deepwater Horizon spill continues to be costly, I
    concur with the recent NRC report that the full impacts of the
    spill are unknown, and will be expressed over years to decades.
    I also question whether H.R. 3096 will facilitate definitive
    answers to the questions being posed. I will attempt to explain
    shortcomings and offer suggestions for improvements.
        H.R. 3096 is precise, administratively, but imprecise on
    how the ocean system works. For instance, fish neither organize
    like regional councils, nor by State and Federal water
    boundaries. The Caribbean, Gulf of Mexico, and southeastern
    United States are not separate marine ecosystems, because they
    are connected by the Loop Current, the Florida current, and the
    Gulf Stream.
        Similarly, while 3- or 9-mile limits distinguish State from
    Federal waters, fish spend their life histories in both of
    these regions. Ecology is, therefore, all about connectivity,
    connectivity in space, time, and across trophic levels.
        Ecology begins with the ocean circulation, uniting
    nutrients with light, fueling primary productivity, and
    distributing water properties. This demands that the Gulf of
    Mexico be studied as a system if we are to better understand
    how it works, assess damages to it, and facilitate and improve
    environmental stewardship.
        An automobile provides an analogy. With mechanical,
    electrical, and fuel systems, an automobile cannot be fixed if
    one does not know how its pieces work individually and
    together, as a system.
        Referenced throughout H.R. 3096 are projects and programs
    that would restore and protect natural resources, ecosystems,
    fisheries, et cetera. Toward this end, the plan is to
    incorporate the President's Gulf Coast Restoration Task Force
    report, which lists four goals and actions. These actions,
    however, are mostly directed toward regions peripheral to the
    Gulf of Mexico versus the Gulf of Mexico itself. As such, the
    actions cannot achieve the goals.
        For instance, beach water quality may have nothing to do
    with local inputs. Instead, water quality may be due to the
    transport of materials from points distant from the beach. Red
    tide offers a case in point, as does the movement of Gag
    Grouper larvae. The reality is that few coastal ocean processes
    are local. Most entail remote connections.
        If these connections are not understood, then the goals
    cannot be met. Even the progression of oil deposition on the
    gulf beaches followed predictable connectivity rules. But these
    concepts are neither included in the task force report, nor in
    H.R. 3096. Whereas, a robust scientific foundation as
    referenced, the basis for that foundation is missing.
        The shortcomings discussed above are echoed in the NRC
    report which states, ``A mechanistic understanding of and model
    for complex linkages and interdependencies of the ecosystem
    being studied would be of immense value in analyzing ecosystem
    services.''
        The coastal ocean is particularly important, because that
    is where society meets the sea. How it works must be
    understood, if we are to predict the consequences of human
    actions and distinguish these from natural occurrences. Such
    understanding comes through observations and hypothesis
    testing. Hence the need for a coordinated program of ocean
    observing and modeling. Only in this manner will we be better
    prepared for future accidents, or become better environmental
    stewards.
        Fisheries provide a focal point. If we can understand
    fisheries, then we can make application to other topics. In
    other words, to do fisheries right we must do all else right.
    All is predicated on understanding how the ocean system works,
    and the connections thereof. The problem is big, requiring
    coordination between observations and science-based models,
    many of which already exist. Benefit will derive from
    empowering those who actually pioneered such studies, and who
    have demonstrated performance through peer-reviewed
    publications.
        We should sustain and systematically build upon what is
    scientifically defensible. But I am concerned about the level
    of funding. Five percent of the trust fund is to be split
    between the program and the fisheries and ecosystems endowment.
    The program will have five centers of excellence, each with
    foci within at least one of five enumerated topics. But of
    these five topics, only one addresses how the Gulf of Mexico
    works. Such dilution will negate having enough funding.
        The fisheries and ecosystems endowment is also troublesome.
    We cannot understand the fish by merely studying fish. Instead,
    the fish must be viewed in the context of the system in which
    they live. The problem is one of State variable estimation with
    the fish being but one of many variables, and dependent upon
    all of them.
        Two modifications are suggested. The first is to increase
    the percentage of money targeted at sustaining and building
    coordinated observing and modeling elements aimed at
    determining how the Gulf of Mexico works. The second is to
    remove preconditions, other than mandating that monies to be
    used in a scientifically defensible manner, to be developed by
    a science steering committee, selected from the academic
    community, organized through the NRC with input from the
    agencies. Plans must be generated by those most familiar with
    the science.
        I appreciate the laudable intent of the task force, the
    agencies, and the drafters of H.R. 3096. With modification, we
    can provide a lasting legacy of benefit to the Gulf States and
    the Nation. Thank you.
        Mr. Landry. Thank you, Dr. Weisberg.
        And it gives me a great privilege to introduce one of my
    constituents from down in south Louisiana, a guy who is right
    on the coast who has seen firsthand the impact of this, not
    only environmentally but economically as well. Mr. Mike Voisin,
    Motivatit Seafoods, Houma, Louisiana.
        Mr. Voisin. Thank you, Congressman. It is nice to have a
    congressman pronounce my name correctly. It is good to be with
    you today. My name is Mike Voisin. I am pleased to have this
    opportunity to appear before you today on several factors
    impacting the seafood production jobs in my home State of
    Louisiana.
        In order to give you the most accurate perspective on this
    issue, I will be wearing my business hat. Since 1971 I have
    owned and operated Motivatit Seafoods in Houma, Louisiana. My
    business is an oyster farming, seafood harvesting, processing,
    and distribution company. But my 40-year career in Louisiana
    fisheries goes well beyond that.
        My family came to Louisiana in 1770, after having gotten
    kicked out of France and then kicked out of Canada, and then
    down to Louisiana. And hopefully Deepwater Horizon won't kick
    us out of Louisiana. I am a seventh generation oyster harvester
    and an eighth generation of my family is poised to take that
    business over.
        2010 was an incredibly challenging and emotional year in
    the seafood community. We had over 40 closures and openings in
    our harvest areas, and a 90- to 120-day period, moving capital
    from one part of a State to another part of the State with
    closures, and throwing product back after closures would occur
    on a moment's notice.
        Since 1982 I have served as a trustee for the Gulf and
    South Atlantic Fisheries Foundation and the Southeastern
    Fisheries Association, and the National Fisheries Institute,
    among other organizations. The Gulf of Mexico and the State
    waters associated with it produce one-third of all domestically
    caught fisheries production in the United States. And in my
    association with each of these organizations I have advocated
    for developing a strong and sustainable commercial fishing
    community. That is why I am here today in support of RESTORE
    Act, H.R. 3096.
        The Louisiana seafood community has faced its share of
    environmental and economic challenges in recent years, most
    notably with the horrific hurricane seasons of 2005 and 2008,
    the Deepwater Horizon spill in 2010, and this past summer
    severe Mississippi River flooding. Fishing is a livelihood that
    has been under attack from environmental regulations, natural
    disasters, and resource depletion. In the absence of concerted
    action, this oil spill could be one of our challenging blows
    for the fishermen and the processors in the Gulf States.
        First, it is imperative to recognize the natural resources
    of our culture and heritage has relied on to feed families for
    many generations is not something you can put a simple dollar
    value on. It is a tradition that has been threatened. It has
    forced U.S. fishery production into a downward spiral. In my
    written testimony I have included two charts provided by the
    National Marine Fisheries Service that outlines employment in
    both recreational and commercial fisheries across the gulf from
    2006 to 2009.
        Secondly, Louisiana's economy is highly dependent on a
    strong seafood supply chain. And under current law, the natural
    resource damage assessment that has been spoken of today a lot
    can take anywhere from 10 to 20 years before efforts can begin
    addressing recovery needs for our natural fishery resources.
    This is time in the seafood community we simply do not have.
        Al Sunseri, a good friend of mine, owner of P&J Oysters, is
    also a competitor. I welcome his competition to keep our
    community healthy and compete in a global marketplace. But he
    is struggling. He can't supply all his wholesale customers
    because production is down by an estimated 50 percent. Next
    year's projections point to an oyster harvest equivalent to 35
    percent of what we had been producing. His workforce will
    likely absorb the impact of the decline in sales. Our future is
    uncertain.
        The only way to move forward is to calm the waters of fear
    in the fishing community, first and foremost by passing the
    RESTORE Act. The gulf coast claims facility is the first step,
    but it is plainly not enough to help ensure our community's
    survival over the medium and long term. The RESTORE Act will
    provide funds more quickly to respond to rebuilding those areas
    that our resources need to be able to thrive, once again.
        At a time when Congress is justifiably looking high and low
    for measures to assist in job creation and generate real
    economic recovery, the RESTORE Act is a concrete immediate step
    that could be taken to do just that. I urge you to act quickly
    in the passage and implementation of this very important act.
    Thank you.
        Mr. Landry. Thank you, Mr. Voisin. And I am going to let my
    southern manners get the best of me and allow the Ranking
    Member, Mrs. Napolitano, to ask the first series of questions.
    Mrs. Napolitano?
        Mrs. Napolitano. Well, and that is very kind of you, sir,
    and I really appreciate it. I would like to start off with Dr.
    Weisberg.
        In your testimony you discussed the need for more monies to
    be dedicated to research and monitoring in the gulf to better
    assess long-term damages and ensure restoration dollars are
    better spent. You also mentioned the preconceptions and
    preconditions about how this money should be spent, how they
    should be removed. Can you explain what you mean in a little
    more detail?
        Mr. Weisberg. Yes, thank you. I guess, said succinctly, we
    cannot restore--when I say ``restore,'' I see there are two
    elements to this bill. One is economics and the other is, say,
    ecological. And I am referring to the ecological.
        We cannot restore what we don't understand. We don't
    understand how the Gulf of Mexico works, as a system. The
    science isn't there. The long-term observations are not there.
    We have no baseline, for instance, of what to restore to. And
    so I am very concerned that the bill has a lot of language like
    ``ecology,'' like ``restoration,'' like ``fisheries,'' but with
    no definition on how to actually go about doing that.
        And given the 5 percent of the monies that are to be
    apportioned, half in one way, half in another way, and a
    dilution within that apportionment, I just don't see how there
    is enough money to do what needs to be done.
        Mrs. Napolitano. OK. But I am not sure whether there are
    any universities doing any studies to be able to understand,
    especially along the gulf coast, to be able to have some of
    that information. I am sure some of them have already made some
    attempt to be able to study the gulf, the sea, the things
    that--because I know we have with--for rivers dams, an
    organization of universities that are doing those studies for
    those. Is there--there isn't any such thing?
        Mr. Weisberg. No, there certainly is. I don't mean to imply
    that there is not. There is. However, the way in which these
    programs are operating are not aimed at determining how the
    Gulf of Mexico works, as a system. They are stovepiped. And so
    we have never really approached the Gulf of Mexico the way it
    really needs to be approached.
        Mrs. Napolitano. OK. But is there a concerted effort, then,
    to be able to understand? If there is already studies, and you
    can then line up the impact this has had on identifying how it
    was versus how it is and how it should be.
        Mr. Weisberg. Those studies are going on. But they are not
    comprehensive enough, they are not sustained, and they are not
    geared to really come up with the answers that we need, going
    forward.
        Mrs. Napolitano. Then I can understand that, because I have
    been involved with other kinds of studies because I am ranking
    member in water and power, and we deal with some of these
    studies for--through the agencies, Natural Resources.
        But--and I can understand there is never enough money for
    the R&D. That is a given. So somehow we need to be able--I
    don't know whether this bill has any segment in there to be
    able to say we need to know more about--with the R&D. There is
    universities getting Federal money. Maybe that is one of the
    things we should impose upon them to study, especially those
    universities that are in that area, and then come back and
    offer--a coalition of them--to be able to look at and add to
    your studies.
        The second question, sir. Can you talk more about the
    potential problems you see in studying fisheries, but not
    studying them within the larger ecosystem, and how does this
    affect the value of the research that may be done?
        Mr. Weisberg. That is a very good question, and I
    appreciate that. Fisheries, historically, have been studied not
    as fisheries oceanography, but as fisheries biology. So the
    fisheries have been studied on the basis of the fish, and not
    enough on the basis of the natural environment in which the
    fish actually make their living.
        And so, I mentioned that the Magnuson-Stevens Act has
    councils. Those councils have specific regionality. But the
    fish don't know that regionality. The fish live in the
    environment. States look within 9 miles or 3 miles. The Federal
    waters go out to the EEZ. Every fish we put on a sandwich
    actually migrates between the State waters and the Federal
    waters. And so the way that we have actually been studying our
    fisheries needs to be looked at again in a more comprehensive
    way, so that we are studying the fish as they truly make their
    living in the environment.
        Mrs. Napolitano. As an industry, as an industry.
        Mr. Weisberg. Yes.
        Mrs. Napolitano. Because it is an industry.
        Mr. Weisberg. Yes.
        Mrs. Napolitano. Are there any suggestions--very quickly
    and to the point--that you might make to make this bill a
    little better?
        Mr. Weisberg. Yes, that is----
        Mrs. Napolitano. Quickly.
        Mr. Weisberg. OK. I think that we need more money going
    into the R&D.
        Mrs. Napolitano. Right.
        Mr. Weisberg. And whether it comes out of this bill or it
    comes out of the NRDA process----
        Mrs. Napolitano. But not split.
        Mr. Weisberg. Right. And I also would not split it the way
    it is split right now.
        Mrs. Napolitano. OK.
        Mr. Weisberg. And I would like to see a different process
    come into place.
        Mrs. Napolitano. OK.
        Mr. Weisberg. I was a little disappointed after we met in
    the President's task force, and----
        Mrs. Napolitano. Thank you for your answer, and very
    quickly. And thank you for your indulgence.
        Mr. Graves, in your statement you said the RESTORE Act is
    simply taking the supplemental and environmental projects--
    process under the Clean Water Act, and giving control of that
    process to the States. But as you know, there are provisions in
    the bill that would allow the Clean Water Act fines to be used
    for that purpose, beyond environmental restoration projects.
        If we are talking about using these fines assessed under
    the Clean Water Act to restore the degradation of the gulf
    caused by the Deepwater Horizon spill, then wouldn't it be
    appropriate to limit the use of these fines, should we
    authorize it, to environmental restoration projects, as you
    described, to protect tourism, ecosystem, et cetera?
        In other words, should we not spend this money--should we
    not be spending this money, the supplemental environment
    project money, on things like casinos, conventions, et cetera?
        Mr. Graves. Congresswoman, I think you make a very good
    point. And you are certainly more familiar with the sausage-
    making process than I am. I will just say that on behalf of the
    State of Louisiana we certainly would make a commitment to
    spend our money or limit our money, money's uses, as consistent
    with the existing process, meaning we would limit our----
        Mrs. Napolitano. But who determines--I am sorry, but I went
    over time--who determines how that money is spent at the State
    level?
        Mr. Graves. As I recall--and I think in the case of the
    State of Louisiana--that would be determined by the CPRA
    through a public process. The State agency where I work,
    through a public process.
        Mrs. Napolitano. So there wouldn't be any legislators
    taking some of that fund to balance the budget and do some
    other things with it?
        Mr. Graves. Ma'am, we have done a very extensive master
    plan prioritization process. It is based solely upon science. I
    couldn't tinker with it if I wanted to. And that would make the
    determination on the priorities.
        Mrs. Napolitano. That is what they said in California.
    Thank you, Mr. Chair.
        Mr. Landry. You are welcome. My question--actually, I would
    like to start with Mr. Voisin for just a second, and then I
    have a question for you, Mr. Graves.
        But this weekend I--and as I watched the SEC championship
    game I was able to procure a sack of oysters from a--off of a
    boat, purchased it off of a oyster boat. You don't--I mean you
    recommend that the gulf oysters are safe today?
        Mr. Voisin. Absolutely, Congressman. One of our real
    challenges today in the seafood community is that, generally
    speaking, the Gulf States get it, and they understand that
    there has been a lot of media, post-event, for 2 years--close
    to, well, a year-and-a-half now. But outside of that, the rest
    of the States have not had that same opportunity to keep up on
    all of the work that has been done.
        All of the seafood that has been harvested in the States
    was always safe. There were significant closures, as I
    mentioned in my testimony, when there was even a hint that
    potentially oil would be in an area. All of the sampling that
    NOAA and FDA and the States did showed no hydrocarbon level
    increases at all of any concern that went beyond what would be
    considered an action level.
        So, oysters, crab, shrimp, fish from the Gulf of Mexico are
    safe, they are high-quality, they are available. And the
    challenge today is getting back out in America and helping
    those individuals who have kind of shied away from it, remind
    them that it is a healthy way to go, and to eat more seafood
    from the gulf coast.
        We are working at that. Congress gave a few dollars to the
    Gulf States Marine Fisheries Commission. We set up a Gulf
    States seafood and marketing coalition that I chair, and we are
    trying to reintegrate ourselves back into the national market.
    But it has been a real challenge, Congressman.
        Mr. Landry. And, of course, the viability of the commercial
    fishing industry, which--you know, I think it is important to
    recognize--and it has bene said multiple times--the importance
    of the gulf coast economy to the rest of the Nation when, in
    fact, 30 percent of our domestically caught seafood comes out
    of that area. I mean that is a third of all of our seafood out
    of a relatively small area.
        And so, I am sure that you are here today because you feel
    that this bill helps not only to move in a direction of
    restoration, but continued viability for both the seafood
    industry and seafood living in the Gulf of Mexico.
        Mr. Voisin. Yes, sir, Congressman. And as I said, you know,
    our family left France and some of them went to Canada and some
    of them came straight to Louisiana. We really don't want to
    leave Louisiana. One of our challenges is Louisiana is leaving
    us. And if we don't implement a lot of the restoration that is
    needed today in Mr. Graves's master plan, Louisiana will leave
    us.
        And what will that do? That--most of the seafood that is
    produced in the whole Gulf of Mexico spends part of its life in
    the estuaries of south Louisiana. So that means that the food
    that feeds America, or part of the food that feeds America,
    will not be able to be produced, as we lose that coastal
    estuary. We need to restore it and maintain it, so that we can
    provide that viable seafood production in south--in the Gulf of
    Mexico.
        Mr. Landry. Well, I thank you. I have eaten my oysters last
    week, I am going to have shrimp stew this week.
        Mr. Graves, could you expand your comment on gap--the gap
    filler comment that you had made earlier?
        Mr. Graves. Yes, sir. The Oil Spill Liability Trust Fund,
    I--it is our view that it is not designed to be the single
    bill-payer for--in response to oil spills. I mean that is the
    responsibility of the responsible party. That is the liability
    of the responsible party.
        I think just as if my neighbor was carrying out some
    irresponsible activities and had threatened to burn down my
    house, I wouldn't sit there and stockpile money in a fund,
    ready to respond to my house burning down.
        Just as--let me put it this way. I mean the Cuba comment
    was brought up earlier. The Oil Spill Liability Trust Fund, the
    funds are in there derived from domestic producers. I don't
    know that it is their liability for what goes on in Cuba. And I
    think an analogy there would be that we have a threat from an
    ICBM being launched from China to the United States. We don't
    sit there and put money in a trust fund, waiting to come in and
    clean up the damage from the missile. Instead, what we do is we
    have bilateral negotiations. We take proactive steps, in terms
    of missile defense systems or regulatory oversight, in the case
    of offshore production.
        And I think that you have a deterrence issue, as well, and
    I think that is the--in the case of domestic production, the
    fines.
        The reality is that the best use of those funds is making
    proactive mitigation investments. And that is what this bill is
    trying to do. And in the case of Louisiana, we want to restore
    our coast, we want to restore the fragmented marsh, so if there
    is another spill or another hurricane, we are not going to have
    the damage that we are currently experiencing from the
    Deepwater Horizon disaster.
        Mr. Landry. And one last comment before we just--we wrap
    up. Isn't it correct that putting these projects into play,
    especially in Louisiana, would help to further protect and make
    future--and hopefully we don't have to use that term ``future
    spills,'' no one wants spills to happen again--but should
    there--an accident, and we can't guarantee that it won't happen
    again--but if we spend this money wisely and implement the
    projects properly, we can actually help mitigate future
    cleanups through proactive means.
        Mr. Graves. There is no question. I am trying to remember
    the exact number, but if you measure our coastline smoothly
    from Texas to Mississippi, it is about 800 miles. If you
    measure the tidal shoreline, meaning all the erosion--eroded
    coastline that has occurred in your district, Congressman, we
    actually have 7--800 miles of tidal shoreline, because of this
    gross erosion, this coastal wetlands loss that has occurred.
        And so, when the oil spill came, we weren't fighting the
    oil or trying to stop the oil on 800 miles. We literally were
    trying to come in and protect 40 million feet of shoreline.
    There is not 40 million feet of boom in the world. And so you
    are exactly right.
        And that is how Louisiana is committing to invest these
    dollars, is to restore our coast, and to put it back in a more
    uniform manner that would help to mitigate damages from future
    spills--and hurricanes, by the way.
        Mr. Landry. Thank you, Mr. Graves. And I would like to
    again thank the panel for taking the time out of their busy day
    to come here and give us your testimony.
        And this committee will now stand adjourned.
        [Whereupon, at 12:17 p.m., the committee was adjourned.]