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

                              CUTTING EPA SPENDING

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

                                    HEARING

                                   BEFORE THE

                  SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 FIRST SESSION

                                   __________

                                OCTOBER 12, 2011

                                   __________

                               Serial No. 112-95

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman

    JOE BARTON, Texas                    HENRY A. WAXMAN, California
      Chairman Emeritus                    Ranking Member
    CLIFF STEARNS, Florida               JOHN D. DINGELL, Michigan
    ED WHITFIELD, Kentucky                 Chairman Emeritus
    JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
    JOSEPH R. PITTS, Pennsylvania        EDOLPHUS TOWNS, New York
    MARY BONO MACK, California           FRANK PALLONE, Jr., New Jersey
    GREG WALDEN, Oregon                  BOBBY L. RUSH, Illinois
    LEE TERRY, Nebraska                  ANNA G. ESHOO, California
    MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
    SUE WILKINS MYRICK, North Carolina   GENE GREEN, Texas
      Vice Chairman                      DIANA DeGETTE, Colorado
    JOHN SULLIVAN, Oklahoma              LOIS CAPPS, California
    TIM MURPHY, Pennsylvania             MICHAEL F. DOYLE, Pennsylvania
    MICHAEL C. BURGESS, Texas            JANICE D. SCHAKOWSKY, Illinois
    MARSHA BLACKBURN, Tennessee          CHARLES A. GONZALEZ, Texas
    BRIAN P. BILBRAY, California         JAY INSLEE, Washington
    CHARLES F. BASS, New Hampshire       TAMMY BALDWIN, Wisconsin
    PHIL GINGREY, Georgia                MIKE ROSS, Arkansas
    STEVE SCALISE, Louisiana             JIM MATHESON, Utah
    ROBERT E. LATTA, Ohio                G.K. BUTTERFIELD, North Carolina
    CATHY McMORRIS RODGERS, Washington   JOHN BARROW, Georgia
    GREGG HARPER, Mississippi            DORIS O. MATSUI, California
    LEONARD LANCE, New Jersey            DONNA M. CHRISTENSEN, Virgin
    BILL CASSIDY, Louisiana              Islands
    BRETT GUTHRIE, Kentucky              KATHY CASTOR, Florida
    PETE OLSON, Texas
    DAVID B. McKINLEY, West Virginia
    CORY GARDNER, Colorado
    MIKE POMPEO, Kansas
    ADAM KINZINGER, Illinois
    H. MORGAN GRIFFITH, Virginia

                                     7_____

                  Subcommittee on Oversight and Investigations

                             CLIFF STEARNS, Florida
                                     Chairman
    LEE TERRY, Nebraska                  DIANA DeGETTE, Colorado
    SUE WILKINS MYRICK, North Carolina     Ranking Member
    JOHN SULLIVAN, Oklahoma              JANICE D. SCHAKOWSKY, Illinois
    TIM MURPHY, Pennsylvania             MIKE ROSS, Arkansas
    MICHAEL C. BURGESS, Texas            KATHY CASTOR, Florida
    MARSHA BLACKBURN, Tennessee          EDWARD J. MARKEY, Massachusetts
    BRIAN P. BILBRAY, California         GENE GREEN, Texas
    PHIL GINGREY, Georgia                DONNA M. CHRISTENSEN, Virgin
    STEVE SCALISE, Louisiana                 Islands
    CORY GARDNER, Colorado               JOHN D. DINGELL, Michigan
    H. MORGAN GRIFFITH, Virginia         HENRY A. WAXMAN, California (ex
    JOE BARTON, Texas                        officio)
    FRED UPTON, Michigan (ex officio)

                                      (ii)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Cliff Stearns, a Representative in Congress from the State
      of Florida, opening statement..................................     1
        Prepared statement...........................................     4
    Hon. Henry A. Waxman, a Representative in Congress from the State
      of California, opening statement...............................     9
        Prepared statement...........................................    11
    Hon. Joe Barton, a Representative in Congress from the State of
      Texas, opening statement.......................................    13
    Hon. Marsha Blackburn, a Representative in Congress from the
      State of Tennessee, opening statement..........................    13
    Hon. John Sullivan, a Representative in Congress from the State
      of Oklahoma, opening statement.................................    14
    Hon. Diana DeGette, a Representative in Congress from the State
      of Colorado, opening statement.................................    14

                                   Witnesses

    Barbara J. Bennett, Chief Financial Officer, Environmental
      Protection Agency..............................................    17
        Prepared statement...........................................    19
        Answers to submitted questions...............................   101
        Additional responses for the record..........................   112
    Arthur A. Elkins, Jr., Inspector General, Environmental
      Protection Agency..............................................    23
        Prepared statement...........................................    25
    Melissa Heist, Assistant Inspector General for Audit,
      Environmental Protection Agency \1\............................
    David C. Trimble, Director, Natural Resources and Environment,
      Government Accountability Office...............................    34
        Prepared statement...........................................    36

                               Submitted Material

    Letter, dated September 15, 2011, from Mr. Upton and Mr. Stearns
      to Lisa Jackson, Administrator, Environmental Protection
      Agency, submitted by Mr. Stearns...............................    78
    Letter, dated October 11, 2011, from Barbara J. Bennett, Chief
      Financial Officer, Environmental Protection Agency, to Mr.
      Stearns, submitted by Mr. Stearns..............................    85
    Report, ``Audit of EPA's Fiscal 2010 and 2009 Consolidated
      Financial Statements,'' dated November 15, 2010, Office of
      Inspector General, Environmental Protection Agency, submitted
      by Mr. Stearns.................................................    91

    ----------
    \1\ Ms. Heist did not offer a statement for the record.

                              CUTTING EPA SPENDING

                                  ----------

                          WEDNESDAY, OCTOBER 12, 2011

                      House of Representatives,
          Subcommittee on Oversight and Investigations,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:34 a.m., in
    room 2322, Rayburn House Office Building, Hon. Cliff Stearns
    (chairman of the subcommittee) presiding.
        Members present: Representatives Stearns, Terry, Sullivan,
    Burgess, Blackburn, Bilbray, Scalise, Gardner, Griffith,
    Barton, DeGette, Castor, Green, Christensen, and Waxman (ex
    officio).
        Staff present: Carl Anderson, Counsel, Oversight; Mike
    Gruber, Senior Policy Advisor; Todd Harrison, Chief Counsel,
    Oversight/Investigations; Kirby Howard, Legislative Clerk;
    Andrew Powaleny, Press Assistant; Krista Rosenthall, Counsel to
    Chairman Emeritus; Alan Slobodin, Deputy Chief Counsel,
    Oversight; Sam Spector, Counsel, Oversight; Peter Spencer,
    Professional Staff Member, Oversight; Kristin Amerling,
    Democratic Chief Counsel and Oversight Staff Director; Alvin
    Banks, Democratic Investigator; Phil Barnett, Democratic Staff
    Director; Alison Cassady, Democratic Senior Professional Staff
    Member; Brian Cohen, Democratic Investigations Staff Director
    and Senior Policy Advisor; and Anne Tindall, Democratic
    Counsel.

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

        Mr. Stearns. Good morning, everybody.
        And the Subcommittee on Oversight and Investigations will
    convene. We welcome our witnesses.
        My colleagues, we convene this hearing, the second in our
    series of hearings on the line-by-line review of the Federal
    budget.
        Today we will examine how the Environmental Protection
    Agency has put into practice the President's repeated
    commitment to conduct a line-by-line review of the Federal
    budget. The goal of this pledge is to eliminate unnecessary,
    duplicative, or wasteful government programs to cut costs and
    do more with less. This hearing aims to determine the results
    of EPA's efforts to cut spending and to help EPA find more
    spending cuts and savings for all Americans.
        Less than a month ago, on September 22, EPA Administrator
    Lisa Jackson testified before this subcommittee on EPA's
    regulatory planning, analysis, and major actions. We remain
    very concerned over the impact on jobs and our economy from new
    regulations that are issued and proposed every day by the EPA.
        That said, the EPA is also an important public health
    regulatory agency which has contributed to the tremendous
    improvements in clean air, safe drinking water, and
    environmental quality over the past 40 years. However, over the
    past two decades, the Agency has become an $8 billion-plus
    agency with about 18,000 employees around this Nation.
        Yet with the size of the Federal deficit and long-term
    fiscal challenges, we must ensure that EPA meets its core
    mission at lower cost. Indeed, Congress has a constitutionally
    mandated responsibility to oversee the annual budgetary process
    affecting agencies under their jurisdiction.
        We recognize that executive branch agencies are not alone
    in their responsibility for having created many of the programs
    that have given rise to our ballooning deficit. For its part,
    this committee must remain deeply and regularly engaged with
    the agencies within its jurisdiction, including EPA, as they
    define their priorities, identify their needs, and set their
    goals for the years ahead.
        Today we look at the actual results of the EPA's efforts
    thus far to meet the President's pledge to comb through the
    Federal budget line by line cutting spending. We are aware of
    several initiatives related to that worthy goal, but what
    measurable results have been achieved? For example, the
    committee has learned from an OMB document that EPA responded
    to the President's April 2009 instruction to Cabinet members to
    identify within 90 days at least $100 million in aggregate cuts
    to their administrative budgets by proposing the ``energy
    efficient lighting project,'' that is, changing light bulbs in
    EPA's office buildings. EPA anticipated the annual savings of
    that pilot project to be de minimis, although it claims the
    initiative could lead to savings over the long run.
        Now, while EPA claims to have implemented additional cost-
    saving efforts since that time, they did not provide to the
    committee the specifics on what actions were taken or, indeed,
    how much money was actually saved.
        To learn more about EPA's efforts, we will take testimony
    today from the Inspector General of EPA, Arthur Elkins; and the
    director of natural resources and environment at GAO, David
    Trimble. These individuals and their staffs have conducted
    rigorous oversight and audits of EPA for many years.
        The GAO and the EPA Inspector General have frequently
    identified areas where EPA can improve its internal controls,
    its management, and its performance measures, all to cut costs
    or get more bang for the buck. Their reports address concerns
    about how effectively and wisely EPA uses its resources to meet
    its mission. Their work, as we will hear this morning,
    identifies problems and recommends improvements in EPA's
    reporting of spending, such as the money it obligates through
    grants, and EPA's ability to track whether its employees are
    being used effectively to meet its core mission, and even in
    EPA's knowledge about duplicative and unnecessary facilities
    around this country.
        As we will hear, there is still much room for improvement.
    For example, the EPA's budget justification documents do not
    describe the amount of potentially millions of dollars of
    unspent money, known as deobligated and recertified funding,
    that is available for new obligations. We say the word million,
    but it is actually billions. Such information could be useful
    to Congress because of the availability of recertified amounts
    that could partially offset the need for new funding.
        So, my colleagues, today I intend to inquire of them as to
    what the EPA has done thus far and what remains to be done. For
    that reason, the subcommittee also welcomes Barbara Bennett,
    the chief financial officer of EPA. We hope that she will be
    able to address the substance of the Inspector General's and
    GAO's outstanding concerns. The subcommittee, and the committee
    as a whole, is committed to working with the EPA to ensure that
    it has the tools it needs to realize these aims and ensure that
    it is a trustworthy custodian of hard-earned American taxpayer
    dollars.
        Today's hearing can be a good start to help deal more
    effectively with the enormous challenge of getting Federal
    spending under control. I look forward to revisiting this
    subject with the EPA next year, following submission of the
    President's budget.
        With that, my opening statement is done, and I recognize
    the ranking member, Mr. Waxman, for 5 minutes.
        [The prepared statement of Mr. Stearns follows:]

        [GRAPHIC] [TIFF OMITTED] T4567.001

        [GRAPHIC] [TIFF OMITTED] T4567.002

        [GRAPHIC] [TIFF OMITTED] T4567.003

        [GRAPHIC] [TIFF OMITTED] T4567.004

        [GRAPHIC] [TIFF OMITTED] T4567.005

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

        Mr. Waxman. Thank you very much, Mr. Chairman and Ms.
    DeGette, for allowing me to go first with this opening
    statement.
        Today we are looking at EPA's budget. It is a lean one for
    an agency with so many crucial responsibilities. Although I
    think if the Republicans get their way, there will be no reason
    for the Agency because we will have no environmental laws
    anymore.
        In February of this year, the President submitted his
    proposed budget for fiscal year 2012, requesting $8.9 billion
    for EPA. That is a 13 percent decrease over the fiscal year
    2010 enacted levels. The President had to make some hard
    choices in this budget. The President proposed cutting almost
    $1 billion from the clean water and drinking water State
    revolving funds, which help States improve municipal wastewater
    and drinking water systems. He proposed cutting $125 million
    from the Great Lakes Restoration Initiative, and $70 million
    from the Superfund toxic waste cleanup program. The
    administration also targeted several categories of
    administrative spending at EPA to achieve $40 million in
    additional savings.
        Now some of these cuts are excessive. The drinking water
    State revolving fund should be getting an increase because it
    makes investments in infrastructure that create jobs. Thus the
    notion that EPA is not sacrificing its fair share is false.
        Despite these painful cuts, EPA has set ambitious goals for
    this fiscal year, taking action on climate change--well, some
    people don't think they ought to do that; improving air
    quality--well, a lot of Members don't seem to think that's a
    good idea; protecting American waters--well, the American
    people believe in that, but a lot of the Republicans don't;
    ensuring the safety of chemicals; preventing pollution; and
    enforcing America's environmental laws. Those are still the
    law, and they have continued to be the law. And therefore, EPA
    has a responsibility to enforce them and the American people
    support that.
        These are important objectives that benefit every American
    in every State across the country. Americans know that their
    families' health and quality of life depend on a clean
    environment. They know we need a strong EPA to stop polluters
    from poisoning our land, our air, and our water.
        Today we'll hear that EPA should be doing more to squeeze
    out extra savings. While I am sure EPA could find additional
    reductions and efficiencies along the margins, I am equally
    sure that the bill--that still won't be enough for my
    Republican colleagues. Their goal is not a careful line-by-line
    review of the budget. Their goal is to prevent EPA from
    requiring dirty power plants, chemical plants, oil refineries,
    and other large industrial sources to stop polluting the air
    with toxic mercury and other dangerous emissions. That is what
    we have been fighting on the floor about over the last several
    weeks.
        The Republicans' approach to EPA's budget is less about
    targeted reductions and more about slash-and-burn politics. The
    Republican budgets we have seen this year are the most sweeping
    and reckless assault on health and the environment that we have
    seen in decades.
        The fiscal year 2012 Interior appropriations bill that
    stalled in the House late this summer would slash EPA's budget
    to $7.1 billion, which is 20 percent less than the President
    requested. This would deny the Agency the resources it needs to
    carry out the Clean Air Act, the Clean Water Act, the Safe
    Drinking Water Act and other critical public health
    protections.
        But that is not all. Every week we consider another bill on
    the House floor that stops EPA from doing its job to protect
    our environment. In fact, the House has voted 83 times this
    year to undermine the EPA. In total, the House has voted 159
    times to undermine environmental protections. If the
    Republicans had their way, the Clean Air Act and the Clean
    Water Act would be gutted, and the EPA would be rendered
    powerless to keep our air clean enough to breathe and our water
    safe enough to drink.
        I am glad we have EPA's chief financial officer here today,
    and I look forward to her testimony. She will be able to tell
    us what the impact of the Republicans' approach to EPA's budget
    would be on her agency and for public health and the
    environment. It is not a budget that is good for our
    environment, our health, or American families. And that is my
    comment on this hearing and the Republican agenda.
        And because I have 20 seconds and I used my time frugally,
    I yield that back.
        [The prepared statement of Mr. Waxman follows:]

        [GRAPHIC] [TIFF OMITTED] T4567.006

        [GRAPHIC] [TIFF OMITTED] T4567.007

        Mr. Stearns. The gentleman yields back.
        The gentleman from Texas, Mr. Barton, is recognized for 2
    minutes.

       OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN
                    CONGRESS FROM THE STATE OF TEXAS

        Mr. Barton. I thank the chairman.
        Former Chairman Waxman and I live in different worlds. We
    are here to talk about EPA's budget. That is a legitimate role
    of this subcommittee. We have a balance sheet that has been
    prepared. It shows their total liabilities and assets are about
    $23 billion. Between fiscal year 2009 and 2010, it shows a
    decrease of about $1 billion, which would be about 4 percent.
    That is not draconian.
        My good friend from California would have you believe that
    we want to eliminate the Environmental Protection Agency and
    eliminate all environmental laws. Nothing is further from the
    truth. I have voted for all the major environmental laws since
    I have been in Congress, and I voted to pass budgets to
    implement them and to enforce them.
        I have a sister who is an enforcement attorney at EPA in
    Dallas with close to 100 percent success rate in enforcing laws
    that some people try to get around.
        What we have a debate about, Mr. Chairman, is an EPA under
    the Obama administration that seems interested in pushing
    everything to the limit, that seems interested in issuing
    regulations that really don't have a sound basis in science or
    in fact, that seem to be more for political purposes than they
    do for environmental protection purposes.
        My good friend from California apparently doesn't believe
    that any of the laws that he and I have worked together to pass
    in the last almost 30 years have had any impact at all and that
    the only thing that is protecting the American people is
    pending additional EPA regulation.
        Mr. Chairman, in my opinion, nothing could be further from
    the truth. And what Republicans in this Congress are attempting
    to do is actually shine the light of transparency on what is
    really happening at the EPA, where the money is going and
    perhaps, just perhaps, how it could be better spend.
        With that, Mr. Chairman, I would yield back.
        Mr. Stearns. The gentleman yields his 2 minutes.
        The gentlelady from Tennessee, Mrs. Blackburn, is
    recognized for 2 minutes.

    OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF TENNESSEE

        Mrs. Blackburn. Thank you, Mr. Chairman.
        I have come to believe that this administration's view of
    the economy can be summed up succinctly: If it moves, tax it;
    if keeps moving, regulate it; if it stops moving, subsidize it.
    And those are timeless words from former President Reagan, and
    they couldn't be more appropriate today, as we look at the
    tsunami of government spending and regulations, and much of
    that is coming from the EPA.
        Many of the complaints we hear in our district are about
    the way EPA handles their rules, regulations, and spending. And
    today I hope that we can kind of uncover what Administrator
    Jackson has done to truly reform the budget process in the line
    by line.
        I had a quote she gave on February 27, 2009. It was in an
    interview and she stated, ``As far as I understand the budget
    process, I can't tell you what EPA's budget will be from year
    to year.'' That one concerned me. And I read it a few times and
    looked at it. And with that statement, I think that she clearly
    laid out why we need to practice appropriate oversight, why we
    need to go through this budget line by line to look for an
    opportunity to help EPA provide a level of certainty, reduce
    waste, and force the Agency to set priorities.
        So I thank all of our witnesses who are with us today. As
    you all are aware, we have another hearing.
        And with that, I yield back the balance of my time.
        Mr. Stearns. The gentlelady yields back.
        The gentleman, Mr. Sullivan, is recognized for 1 minute.

     OPENING STATEMENT OF HON. JOHN SULLIVAN, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF OKLAHOMA

        Mr. Sullivan. Chairman Stearns, thank you for holding this
    important hearing today on cutting the EPA's spending.
        In September 2009, the Obama administration announced plans
    to implement a line-by-line, page-by-page review of the Federal
    budget. And he tasked his Cabinet members to find savings. Here
    we are, 2 years later, and the President has still not done
    what he promised with the budget. The simple fact is, the
    Federal Government is broke, and we are in a fiscal crisis. We
    must make extraordinary efforts to cut spending, eliminate
    waste, and find savings, which is why this oversight hearing is
    so important. EPA has cut some spending as part of a routine
    annual budget and appropriations process but has not taken any
    real extraordinary steps to cut spending. We know that EPA has
    upwards of $13.3 billion in unexpended appropriations and both
    the GAO and the Inspector General say that EPA lacks basic
    internal controls and data on employee workloads and how it
    spends on its payroll. Thanks in advance to our panel before
    us, and it is my hope that our discussion here today sheds
    light on the EPA's budget situation.
        I yield back the balance of my time.
        Mr. Stearns. The gentleman yields back. The chairman
    recognizes the ranking member, the gentlelady from Colorado,
    for 5 minutes.

     OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF COLORADO

        Ms. DeGette. Thank you very much, Mr. Chairman, for
    recognizing me.
        This is the second in a hearing that the subcommittee
    launched last week about the administration's budget review
    process. When I went home to my district over the weekend, I
    was telling people about the hearing last week, and they really
    couldn't believe it because it was really one of the silly--
    with all due respect, it was one of the silliest hearings that
    I have seen in my 15 years in Congress. It started out with the
    majority playing a video of the President promising a line--put
    little clips showing him promising a line-by-line budget
    review, which then I thought maybe that was figurative, but in
    fact, literally then members of this subcommittee spent the
    whole time talking about, did the President actually personally
    review the budget line by line?
        I don't really think that is what we need to be looking at,
    and I would hope the majority doesn't think so either. Because
    what we really need to look at is the budget process of these
    various agencies and whether or not they have conducted an
    efficient and effective budget review and whether improvements
    can be made in this process. I think that that is an important
    oversight responsibility for this subcommittee for every
    agency, not just the EPA. And so I think that those are
    important questions that should be asked of all of these
    witnesses.
        And so to that end, let's look at a few key facts about the
    EPA budget review process as I understand it. Right here--this
    large notebook--is what is known as the Agency budget
    justifications, which the EPA prepares and provides to the
    Appropriations Committee each year. This mammoth set of
    documents reflects the detailed process in which the EPA
    engages to produce a budget proposal. In this document, the
    Agency provides a detailed explanation of the funding levels
    requested for each EPA program area.
        The EPA justifications document results from a multistep
    review process, as I understand it, in which the EPA program
    staff develop a budget proposal; the EPA chief financial
    officer reviews the proposal; EPA senior leadership meets to
    discuss overall funding level requests; EPA submits a proposal
    to OMB; EPA negotiates with OMB over the proposal; and OMB
    sends back an approved budget.
        And as in previous years of the Obama administration, the
    review process at the EPA has resulted in an administration
    budget proposal for the EPA that requests increases in funding
    for some programs and decreases funding for others. And that is
    as it should be. And I would assume that that involves a line-
    by-line review of these budget requests by the people in the
    Agency who are responsible for those parts of those budgets.
        But you can understand our concern about cuts to the EPA
    budget because if you just look and see what Congress has
    already voted to do, we are not just talking about, should we
    have new regulations; in H.R. 1 and in other votes in this
    Congress, we have seen substantial cuts to enforcement for
    existing environmental review programs. In fact, they are some
    of the most anti-environmental votes that I have seen. In the
    first 10 months of this Congress, we have had 159 floor votes
    to undermine protection of the environment; EPA programs to
    reduce toxic mercury pollution, reduce greenhouse gas
    emissions, and make our Nation's vehicles more efficient and
    reduce gas costs for consumers, and on and on.
        I have asked the Democratic staff to prepare a list of the
    existing EPA agencies and regulations which Mr. Barton and
    others say they support which have had drastic proposals
    slashed budgets for enforcement in previous votes of this
    Congress which I don't think are probably born out by the
    evidence.
        And so here is the thing, I think that the public values
    clean water and clean air. I think they value strong
    environmental enforcement, and furthermore, I think these
    environmental laws produce health, economic, and environmental
    benefits that actually increase our budget. In fact, some
    estimates have shown $1.3 trillion in 2010. By 2020, the
    benefits are projected to reach $2 trillion annually,
    outweighing estimated costs by more than 30 to one.
        Overall, in the three decade period from 1990 to 2020, the
    Clean Air Act is estimated to deliver $12 trillion worth of
    benefits, plus a host of additional health and welfare benefits
    that cannot be monetized. And so if you look at the EPA
    spending compared to the enormous impact on public health,
    EPA's proposed 2012 budget is just 0.06 percent of the Federal
    Government's total debt, 0.26 percent of total spending, and
    0.69 percent of the Federal deficit. If you eliminated the EPA
    altogether, it wouldn't even be a blip in our Nation's budget.
    But the costs that we would pay in health and in other types of
    spending would be astronomical. I think we need to have savings
    in the EPA just like every other agency, but I think that this
    fixation we have is wrong, and we have got to stop it.
        Mr. Stearns. The gentlelady completes her opening
    statement.
        And let me introduce our witnesses before we put them under
    oath. We have the Honorable Barbara J. Bennett, chief financial
    officer, U.S. Environmental Protection Agency; the Honorable
    Arthur A. Elkins, Jr., Inspector General, who is accompanied by
    Melissa Heist, assistant inspector general for audit, U.S.
    Environmental Protection Agency; and we have Mr. David C
    Trimble, director of natural resources and environment, U.S.
    Government Accountability Office.
        Welcome to you folks.

      STATEMENTS OF BARBARA J. BENNETT, CHIEF FINANCIAL OFFICER,
        ENVIRONMENTAL PROTECTION AGENCY; ARTHUR A. ELKINS, JR.,
    INSPECTOR GENERAL, ENVIRONMENTAL PROTECTION AGENCY, ACCOMPANIED
       BY MELISSA HEIST, ASSISTANT INSPECTOR GENERAL FOR AUDIT,
        ENVIRONMENTAL PROTECTION AGENCY; AND DAVID C. TRIMBLE,
        DIRECTOR, NATURAL RESOURCES AND ENVIRONMENT, GOVERNMENT
                         ACCOUNTABILITY OFFICE

        Mr. Stearns. You folks are aware that the committee is
    holding an investigative hearing. And when doing so, it has had
    the practice of taking testimony under oath.
        Do you have any objection to testifying under oath?
        No. The chair then advises you that under the Rules of the
    House and rules of the committee, you are entitled to be
    advised by counsel.
        Do you desire to be advised by counsel during your
    testimony today?
        Mr. Elkins. No.
        Mr. Stearns. No. In that case, please rise and raise your
    right hand. I will swear you in.
        [Witnesses sworn.]
        Mr. Stearns. You are now under oath and subject to the
    penalties set forth in Title XVIII, Section 1001, of the United
    States Code.
        You may now each give a 5-minute summary of your written
    statement.
        Ms. Bennett, you shall start. And just turn your mike on.

                    STATEMENT OF BARBARA J. BENNETT

        Ms. Bennett. Thank you.
        Good morning, Chairman Stearns, Ranking Member DeGette, and
    members of the subcommittee. I am pleased to be here to discuss
    with you the important issue of ensuring the most effective and
    efficient use of taxpayer dollars.
        As you mentioned in your letter to Administrator Jackson,
    President Obama has stated several times his intent that his
    administration would review the Federal budget page by page,
    line by line, and eliminating those programs we don't need, and
    insisting that those we do operate in a sensible and cost-
    effective way.
        While we have always worked diligently with regard to our
    budget formulation process at EPA, the President's directive
    has given us an opportunity to look even more closely at our
    budget process to ensure that we are achieving maximum
    efficiencies.
        To address how we have, in fact, been pursuing this close
    scrutiny of our budget, I would like to take a moment to
    discuss EPA's budget over the last decade or so. Apart from the
    targeted increases to the State revolving funds and for
    programs funded under the Recovery Act of 2009, EPA's budget
    has not grown significantly over the last decade. Even
    including the increase to the SRS in fiscal year 2010, between
    fiscal year 2000 and the fiscal year 2012 President's budget
    request, the Agency has experienced a compound annual growth
    rate of just 1.4 percent, a rate less than that of inflation.
        During this 10-year time frame, our responsibilities have
    grown, as did our costs for such necessities as rent,
    utilities, security, and payroll. For more than a decade, we at
    EPA have needed to make cuts to existing programs to find
    resources to fund emerging priorities.
        The work of the Agency is reviewed at the appropriation,
    program project and, where established, the subprogram project
    levels. This is the budget structure developed in concert with
    OMB and with Congress. Within this framework, the Agency
    considers the progress made towards its annual and long-term
    goals and priorities as articulated in our strategic plan and
    emerging needs.
        Meeting existing commitments and planning for future needs
    cannot be done without considering opportunities to redirect
    resources to higher priorities and reduce overall budget
    levels, as required. In making these reductions, we have
    carefully considered guidance from the administration and
    Congress by looking first to less effective, potentially
    overlapping activities for reductions or eliminations. However,
    the need to find reductions and fund higher priorities also
    means that at times worthy projects get cut.
        During this administration, we have had to make some
    difficult decisions to eliminate or reduce programs. In our
    fiscal year 2010 budget request, we included a $10 million cut
    to the U.S.-Mexico border program. In fiscal year 2011, we
    proposed over $30 million in reductions to homeland security
    programs. We also reduced our travel budget by nearly 40
    percent over the prior year. In fiscal year 2012, in our
    request, we have included a reduction of over $6 million from
    indoor air and radiation programs as well as approximately $10
    million in efficiencies in our agency-wide IT programs.
        Over the past several years, we have also had success in
    finding efficiencies that enable us to maximize the resources
    available to core programs. Some examples include efforts to
    find savings in rent and utilities through space consolidation.
    Between fiscal year 2006 and 2011, we have released
    approximately 375,000 square feet of space at headquarters and
    facilities nationwide, resulting in cumulative annual rent
    avoidance of over $12 million. These are just a few examples of
    some of the choices we have made and efficiencies we have
    achieved as we reviewed our programs in developing EPA's
    budgets to ensure wise use of resource dollars and as we seek
    to do our part to reduce the deficit while maintaining
    effective protections for human health and the environment.
        Mr. Chairman, I would like to thank you again for inviting
    me to testify about the Agency's effort to apply close scrutiny
    to our budget, and I hope I have conveyed to you the
    seriousness with which we at EPA take our responsibility to
    ensure that all funds are used prudently so that we can
    continue to effectively fulfill our mission of protecting human
    health and the environment, especially during these times of
    tight fiscal constraint. And with that, I look forward to
    responding to your questions.
        [The prepared statement of Ms. Bennett follows:]

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        Mr. Stearns. I thank the gentlelady.
        Mr. Elkins, you are recognized for 5 minutes.

                     STATEMENT OF ARTHUR A. ELKINS

        Mr. Elkins. Thank you. Good morning, Chairman Stearns,
    Ranking Member DeGette and members of the subcommittee. I am
    Arthur Elkins, Jr., Inspector General of the U.S. Environmental
    Protection Agency. I also serve as the Inspector General of the
    U.S. Chemical Safety and Hazard Investigation Board. I am
    accompanied by Melissa Heist, Assistant Inspector General for
    Audit.
        I am pleased to appear before you today to discuss recent
    work we have done that identifies opportunities for cost
    savings and greater efficiencies within the Agency. I submitted
    a statement for the record which details this work. This
    morning, I want to focus my remarks on two areas: Management of
    the Agency's human capital and EPA facilities. Over the last 5
    years, EPA has averaged a little over 18,000 positions with
    annual payroll costs of approximately $2 billion. For an
    organization to operate efficiently and effectively, it must
    know what its workload is. The main objectives of assessing and
    predicting workload are to achieve an evenly distributed,
    manageable workload and to accurately determine the resource
    levels needed to carry out the work.
        We have issued three reports since 2010 examining how the
    Agency manages its workload and workforce levels. We have found
    that it has not collected comprehensive workload data or
    conducted workload analyses across EPA in about 20 years. The
    Agency does not require program offices to collect and maintain
    workload data. Without sufficient workload data, program
    offices are limited in their ability to analyze their workloads
    and accurately estimate resource needs. Therefore, the Agency
    must base budget decisions primarily on subjective
    justifications at a time when budgets continue to tighten and
    data-driven decisions are needed.
        We also found that the Agency's policies and procedures do
    not include a process for determining resource levels based on
    workload, as prescribed by OMB. As a result, the Agency cannot
    demonstrate that it has the right number of resources to
    accomplish its mission.
        Finally, we have found that the Agency does not have a
    coherent program of position management to assure the efficient
    and effective use of its workforce. Position management
    provides the operational link between human capital goals and
    the placement of qualified individuals into authorized
    positions. Without an agency-wide position management program,
    EPA leadership lacks reasonable assurance that it is using
    personnel in an effective and efficient manner to achieve
    mission results.
        We have made several recommendations to address these
    findings. While the Agency has taken action to study workforce
    issues and update their budget guidance, most of our
    recommendations remain unresolved and resolution efforts are in
    progress.
        Regarding EPA's space and facilities, in fiscal year 2009,
    we collected data on staffing levels and total costs for EPA
    facilities in response to a request from the House
    Appropriations Committee. Based on EPA data, we reported at the
    time that EPA had more than 18,000 employees in 140 locations
    across the country. These locations cost approximately $300
    million annually, which included rent or leases, utilities, and
    security costs. EPA headquarters accounted for $100 million,
    the largest portion of those costs. We also reported that EPA
    had 86 locations with five or fewer employees, at a cost of
    $2.25 million. Many of these offices were actually staffed by
    only one or two people.
        We made no recommendations because the request was limited
    to data collection. However, we do believe EPA should examine
    its real estate portfolio for possible cost savings. Facilities
    data like we collected would assist EPA in determining whether
    it should shrink its footprint either through consolidating or
    eliminating facilities. We will soon begin a project this
    fiscal year that will assess EPA facility occupancy to
    determine whether EPA is maintaining optimal utilization of
    existing space in its location and whether opportunities exist
    to reduce facility costs, which will also assist EPA in its
    decision making.
        In closing, EPA must find ways to better manage and utilize
    its resources and improve its operational efficiencies in this
    tight budget environment. I believe the OIG has added value by
    making numerous specific recommendations to the Agency over the
    years to help address these issues, many of which it has agreed
    to implement. Going forward, the Agency will need to intensify
    its efforts to control the cost of, and maximize the benefits
    from, the resources entrusted to it. We will continue to work
    with the Agency to further identify areas needing attention.
        Thank you for the opportunity to testify before you today.
    I would be pleased to answer any questions the subcommittee may
    have.
        [The prepared statement of Mr. Elkins follows:]

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        Mr. Stearns. Mr. Trimble, you are recognized for 5 minutes.

                     STATEMENT OF DAVID C. TRIMBLE

        Mr. Trimble. Chairman Stearns, Ranking Member DeGette, and
    members of the subcommittee, I am pleased to be here today to
    discuss GAO's work on management challenges facing EPA as well
    as observations on the Agency's budget.
        As you know, EPA operates in a highly complex and
    controversial regulatory arena and its policies and programs
    affect virtually all segments of the economy, society, and the
    government.
        My testimony draws on prior GAO work and focuses on three
    areas: The management of EPA's workload, workforce, and real
    property; coordination with other agencies to more effectively
    leverage limited resources; and observations on the Agency's
    annual requests for new budget authority.
        First, in 2010, we reported that the EPA had not
    comprehensively analyzed its workload and workforce since the
    1980s to determine the optimal numbers and distribution of
    staff across the Agency. Rather than establishing a process for
    budgeting and allocating human resources based on the Agency's
    workload, EPA requested funding and staffing through
    incremental adjustments based on historical precedent.
        We recommended that EPA link its workforce plan to its
    strategic plan and establish mechanisms to monitor and evaluate
    its workforce planning efforts. Such efforts could enhance the
    Agency's ability to strategically allocate scarce resources.
        Earlier this year, GAO reported on challenges that EPA
    faces in managing its laboratories, both from a workforce and a
    real property perspective. We reported that EPA operated a
    laboratory system comprised of 37 labs housed in 170 buildings
    and facilities in 30 cities across the Nation. We reported that
    EPA's laboratory activities were managed by 15 different senior
    managers, were largely uncoordinated, and that the Agency did
    not have a comprehensive process for managing its laboratory
    workforce. For example, EPA did not have basic information on
    its laboratory workload or workforce, such as data on the
    number of Federal and contract employees working in its labs.
        This report also identified challenges related to the
    Agency's management of its real property, a government-wide
    challenge that is part of GAO's high-risk series. In 2010, the
    administration directed agencies to speed up efforts to
    identify and eliminate excess properties to help achieve $3
    billion in cost savings by 2012. In July 2010, the EPA told the
    Office of Management and Budget that it did not anticipate
    disposing of any of its laboratories in the near future because
    the facilities were fully used and considered critical to the
    Agency. However, we found that EPA did not have accurate and
    reliable information called for by OMB on the need for the
    facilities, property used, facility condition, and facility
    operating efficiency to inform its determination.
        Second, the nature of EPA's work requires it to coordinate
    and collaborate with other Federal agencies as well as State,
    local, and tribal partners. Our recent work on the Chesapeake
    Bay cleanup and pharmaceuticals in drinking water has shown
    that EPA could do a better job collaborating with these
    partners and in turn better leverage limited resources. In
    2009, we reported that the efforts of EPA and six Federal
    agencies to support drinking water and wastewater projects on
    the U.S.-Mexico border region were ineffective because only one
    of the agencies involved has comprehensively assessed the
    region's needs or had coordinated policies for selecting and
    building projects. We included this issue in our March 2011
    report to Congress concerning Federal programs with duplicative
    goals or activities.
        Third and finally, with respect to the Agency's budget and
    annual requests for budget authority, our past reviews of the
    Agency's budget justification documents have led to two
    recurring observations: First, regarding proposals for new or
    expanded funding, the Agency has not consistently provided
    clear justification for the funds requested or what steps the
    Agency would take to ensure the effective use of the funding.
        Second, over the years, we have focused on the Agency's
    efforts to make use of unliquidated balances or funds that were
    appropriate and obligated but never actually spent. This occurs
    when contracts, grants, or interagency agreements expire with
    some level of funding remaining unspent. We have encouraged EPA
    to quickly identify and recover these funds for other uses, as
    it could decrease the need for new budget authority. While the
    EPA has made progress in recovering these funds, we have
    observed that EPA does not include this information in its
    budget justification documents. We believe that information on
    the reuse of such funds could help Congress in its budget
    deliberations.
        This concludes my prepared statement. I will be pleased to
    answer any questions that you or other members of the
    subcommittee may have.
        [The prepared statement of Mr. Trimble follows:]

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        Mr. Stearns. Mr. Trimble, thank you very much.
        I will start with my questions.
        Ms. Bennett, you heard Mr. Trimble from the GAO. Were you
    aware of his report? Yes or no.
        Ms. Bennett. I am aware of most of the reports, yes.
        Mr. Stearns. OK. And has your staff been working on answers
    to some of the items he has talked about and particularly the
    one dealing with unexpended appropriations?
        Ms. Bennett. Yes. In fact, we have been working hard on
    most of what are called the unliquidated obligations.
        Mr. Stearns. OK. You said in your opening statement, you
    also said in your prepared statement, that the President had a
    directive to you to look at item by item, line by line in the
    budget. So, just to be clear, the President asked you to review
    the budget page by page, line by line. Was this a directive
    that you understood?
        Ms. Bennett. This is a directive that we have heard from
    the President and by OMB. We have heard that, although there
    hasn't been an explicit order or explicit guidance. But I am
    familiar with that, obviously, from----
        Mr. Stearns. So you have no written document from anybody
    on what this means to you?
        Ms. Bennett. Well, I have a very good understanding of what
    line by line and page by page means in terms of----
        Mr. Stearns. Would you say that it was a figure of speech?
    Or did it actually mean--the President actually said, ``line by
    line, item by item, page by page, program by program''? He was
    pretty specific. Do you understand that to be literal, or do
    you think that is a figure of speech?
        Ms. Bennett. Well, I wouldn't suppose what the President
    says, but I certainly took it to heart in terms of how we
    approached it.
        Mr. Stearns. Would it be fair to say that you have taken it
    at its literal meaning?
        Ms. Bennett. Well, what we have done is we have had a
    process that goes through----
        Mr. Stearns. So you have actually, procedure-wise. have
    gone item by item, line by line, page by page, program by
    program?
        Ms. Bennett. We have a process that goes through the
    programs and looks at all of our programs in terms of the
    program project level and what we have identified and work with
    both----
        Mr. Stearns. Could I construe that to mean that you are
    actually looking at every page and every line and every item?
        Ms. Bennett. In terms of how the Agency is concerned----
        Mr. Stearns. That is true?
        Ms. Bennett [continuing]. We have staff that goes through
    all aspects of the budget and is able to identify programs and
    the like. So we have worked--as I mentioned, we have worked
    with both OMB and with Congress on what we have----
        Mr. Stearns. You could do that by just going in a broad
    sense. You would have to get into a detailed sense. So your
    prepared statement and your opening statement has confirmed in
    my mind that you didn't consider this a figure of speech, but
    you considered it something that you had to get into the
    details and follow the directive from the President.
        So maybe EPA's look at financial records, such as the
    ledger sheet that I mentioned earlier, page 26 from the EPA
    Inspector General's report on financial statements--and I want
    to give a copy to Ms. Bennett. Did the staff give a copy?
        Ms. Bennett. I have got it.
        Mr. Stearns. OK. If you look at the highlighted line for
    unexpended appropriations, it says $3.3 billion. Do you see
    that one? It is in the bottom there.
        Ms. Bennett. I do.
        Mr. Stearns. OK. Now, EPA's budget is around $8 billion. So
    to see unexpended money that is not obligated, that is just
    sitting there--that amount of money, almost twice, not quite
    twice of your overall budget, to us, obviously that is a very
    large number. So what does that $13.3 billion in unexpended
    appropriations mean in this document that I showed you?
        Ms. Bennett. Mr. Stearns, Mr. Chairman, this is a balance
    sheet from 2010 as compared to 2009. And in 2010, EPA's budget
    was $10.3 billion as well as it had received over $7 billion in
    Recovery Act funding. So the combination of those two, of $17
    billion that would have come through in 2009, in 2010 would be
    reflected here, not the $8 billion that you referenced for this
    year.
        Mr. Stearns. So, you are saying that you got so much money
    that you couldn't spend it all?
        Ms. Bennett. No, that is not what I said at all. What I am
    saying is that it is not reflective of the $8 billion that you
    mentioned.
        Mr. Stearns. Well, the $8 billion is your annual budget.
        Ms. Bennett. For 2010, we are at $8.7.
        Mr. Stearns. OK. So when I look and you have got this
    budget--but you are still not explaining to me how you could
    have $13.3 billion of funds that have not been spent. Where is
    this money--is it money that is in a bank account? Money that
    you can get from the Treasury? What is this money doing? Why
    can't you just give it back to the Treasury and reduce the
    deficit?
        Ms. Bennett. Well, actually, most of our funds go to the
    States and tribal assistance grants, and many of those projects
    are multi-year----
        Mr. Stearns. So you are saying this is all--$13.3 billion
    is obligated funds that you haven't spent yet?
        Ms. Bennett. Most of the funds have been obligated and have
    not been spent.
        Mr. Stearns. How do you know that? Do you have a report
    that you could give us to show how that $13.3 billion is
    detailed in obligations to Indian tribes to--to who else?
        Ms. Bennett. States.
        Mr. Stearns. States, OK.
        Ms. Bennett. States and communities. And for, both for
    water infrastructure----
        Mr. Stearns. I mean, is it obligated from 5 years ago, 2
    years ago, 90 days?
        Ms. Bennett. Well, a lot of them are all obligations. So
    some of them----
        Mr. Stearns. Over what period of time?
        Ms. Bennett. Well, this is a balance sheet which reflects
    cumulative.
        Mr. Stearns. Could it be more than 5 years?
        Ms. Bennett. Well, at the particular time of this balance
    sheet, it could have been, yes.
        Mr. Stearns. Could it be more than 10 years?
        Ms. Bennett. For instance, in 2011, the budget that we
    received--that encompasses the $8.7 billion that I referred
    to--called for a rescission of unobligated--of unobligated----
        Mr. Stearns. OK. I understand. I am going to close.
        I will just ask Mr. Trimble, do you understand what she is
    saying?
        Mr. Trimble. Yes. I believe so. There is always a lag time
    between when money is appropriated and obligated and actually
    spent. So there is a lag through this process. We have not
    looked, or I have not had a chance to look over the balance
    sheet.
        Mr. Stearns. I will close.
        Ms. Bennett, I think for the record we would like to get
    where this obligated fund is in a time-duration milestone so we
    can see if it is money that can be returned to the Treasury or
    that actually you have obligations. So, with that, my questions
    are complete.
        Ms. DeGette. Thank you, Mr. Chairman.
        Going back to this balance sheet, a balance sheet is a
    snapshot in time, as of, in this case, the end of the fiscal
    year for 2010 and 2009.
        Correct, Ms. Bennett?
        Ms. Bennett. Yes, that is correct.
        Ms. DeGette. So I think we are mixing apples and oranges a
    little bit because, as of September 30 of each of those years,
    you have got unexpended appropriations there on that balance
    sheet. But what you are saying is that is--most of that--it is
    not just money that is sitting there from an appropriation that
    could be given back. It is obligated for something, correct?
        Ms. Bennett. That is correct.
        Ms. DeGette. And so what Mr. Stearns and I would like you
    to do is to go back and for each of those fiscal years to make
    a breakdown of that, how much of that was obligated and where
    it was obligated. And for each of those programs, how many--
    because it is not the same for every program. It is a different
    time period for which those funds are obligated, correct?
        Ms. Bennett. Right. Correct. Some programs spend the funds
    faster. For instance, the worker infrastructure projects----
        Ms. DeGette. Right. So if you could just supplement your
    testimony with that information, I think that would help us to
    figure out exactly what that number means in terms of funds.
        Ms. Bennett. We would be happy to do that.
        [The information appears at the conclusion of the hearing.]
        Ms. DeGette. Thank you very much.
        Now my second question to you is, there have been some
    suggestions made by both of the other agencies represented here
    today. Have you reviewed those recommendations?
        Ms. Bennett. Just about all of them, yes.
        Ms. DeGette. OK. One recommendation that both the IG and
    the GAO had made was that the EPA review its personnel policies
    and its management policies to make sure that the human
    resources are actually working to achieve the Agency's mission.
    I hate to put words into your mouths, but that's essentially
    it. Have you reviewed those types of recommendations?
        Ms. Bennett. Yes. And I have spoken with both the Inspector
    General and----
        Ms. DeGette. And what is the EPA doing to address those
    recommendations?
        Ms. Bennett. So the workforce and the workload issues are
    two separate issues. They may sound very similar, but they're
    actually different issues. The workload is the amount of work
    that the Agency has to do, and the workforce reflects more like
    skills that are needed.
        Ms. DeGette. Right.
        Ms. Bennett. And might be needed in the future. So what my
    office has done, has led the workload planning. And so we have
    taken into consideration the recommendations from both the
    Inspector General and from GAO, and my office is leading an
    analysis that is really three-pronged in nature. One is
    benchmarking line managers in terms of----
        Ms. DeGette. OK. If you could just shorten up a little
    because I have got a lot more questions and not much time left.
        Ms. Bennett. Sure. We are taking a look to see where we can
    address the recommendations.
        Ms. DeGette. And when are you going to be finished with
    that review so that you can--and having made your own internal
    relations?
        Ms. Bennett. We're finished with one part of it, and we
    should be finished with the second step some time shortly.
        Ms. DeGette. If you can provide the committee with that
    information, that would be helpful as well.
        Now Mr. Elkins, you made a number of observations and
    recommendations. These issues have been systemic in the EPA for
    some number of years, correct?
        Mr. Elkins. That is correct.
        Ms. DeGette. These didn't just rise up in the past couple
    of years, right?
        Mr. Elkins. Based on our findings, that's correct.
        Ms. DeGette. Based on your findings, how long have these
    issues been present at the EPA?
        Mr. Elkins. Well, we have looked at this issue at least
    over the last 3 or 4 years or so.
        Ms. DeGette. OK. Last 3 or 4 years. And you are working
    with Ms. Bennett and her staff to try to address those
    recommendations.
        Mr. Elkins. That is correct.
        Ms. DeGette. OK. And do you believe that they are going to
    address them?
        Mr. Elkins. We have been told that they are actively
    seeking to address them, that is correct.
        Ms. DeGette. And Mr. Trimble, what about you? The issues
    that you identified in your excellent report, how long have
    they been going on in the EPA?
        Mr. Trimble. Well, in regards to the workforce planning, we
    know that the last time a comprehensive plan was done was in
    the 1980s.
        Ms. DeGette. So it is over 20 years that this has been
    going on?
        Mr. Trimble. That is correct.
        Ms. DeGette. And what about the other issues?
        Mr. Trimble. Workload is probably also a longstanding issue
    that crops up also when we do more programmatic focused work as
    well.
        Ms. DeGette. What about the facilities issues? I thought
    that was an interesting issue and one that I think would take
    time to address.
        Mr. Trimble. Well, facilities is a little bit different in
    that GAO has put government-wide facility management and
    Federal real property management on its high-risk list, so a
    government-wide issue in that regard.
        Ms. DeGette. And how long has it been?
        Mr. Trimble. That I believe it is the 2003-2004 time frame.
        Ms. DeGette. OK.
        Mr. Trimble. And the issue I site in the report just came
    out of the work we did this year concerning the laboratories.
        Ms. DeGette. Now, has GAO been working with the EPA to
    address the GAO recommendations?
        Mr. Trimble. We have made recommendations. We have
    discussed those. I know, in regards to workforce, they have--a
    contractor has just completed a study. Booz Allen, I believe,
    is finishing a study. We have not looked at the scope or sort
    of the findings of that work.
        Ms. DeGette. Do you intend to do that?
        Mr. Trimble. I imagine we will end up having follow-on
    work, but nothing is planned at this point.
        Ms. DeGette. OK. Thank you.
        Thank you very much, Mr. Chairman.
        Mr. Stearns. The gentleman from Texas is recognized for 5
    minutes.
        Mr. Barton. Thank you, Mr. Chairman.
        Ms. Bennett, how many employees are currently employed at
    the EPA?
        Ms. Bennett. We requested in the 2012 budget just over
    17,200.
        Mr. Barton. 17,200. You mentioned in your prepared
    testimony that the travel budget was reduced by 40 percent last
    year, is that correct?
        Ms. Bennett. Close to it, yes.
        Mr. Barton. OK. Do you know how much was actually spent on
    travel last year?
        Ms. Bennett. In 2011, I don't off the top of my head. I
    will be happy to get back to you.
        Mr. Barton. Do you know how much was----
        Ms. Bennett. I do know what we did with the budget.
        Mr. Barton. Well you have said that you reduced it. It was
    reduced 40 percent. So 40 percent from what?
        Ms. Bennett. In 2010, we had a budget of approximately $60
    million, and so we had reduced it to less than $50, and then we
    have it reduced again to less than $40 million.
        Mr. Barton. So that is in your budget. You don't know what
    was actually spent. But you have gone from $60 million to $40
    million.
        Ms. Bennett. We took a significant cut in 2011.
        Mr. Barton. Do you know what that would be per employee?
        Ms. Bennett. I haven't done the math on a per employee. Not
    everybody travels.
        Mr. Barton. Just roughly, that would be either $2,000 or
    $20,000. It is either $2,000 or $20,000 per employee. That is
    just back-of-the-envelope numbers. Do you know how many
    employees at EPA of these 17,000 have an EPA credit card?
        Ms. Bennett. Have a credit card, an EPA credit card?
        Mr. Barton. Yes.
        Ms. Bennett. I don't know the number of how many.
        Mr. Barton. Do you have an estimate?
        Ms. Bennett. I would have to get back to you on.
        Mr. Barton. Mr. Elkins, do you happen to know that number?
        Mr. Elkins. No, I don't.
        Mr. Barton. Could each of you attempt to get that number,
    the number of employees that have EPA credit cards and the
    credit limit on those credit cards and the amount spent on
    those credit cards in the most recent fiscal year, can y'all do
    that?
        Mr. Elkins. I would be glad to.
        Ms. Bennett. I would be glad to get back to you.
        [The information appears at the conclusion of the hearing.]
        Mr. Barton. Do you happen to know, either one of you,
    whether EPA has ever done an audit of the EPA employees that
    have credit cards?
        Ms. Bennett. I know that we have a process in place within
    the Office of the Chief Financial Officer that makes sure that
    those travel vouchers are looked at and reviewed for
    appropriateness.
        Mr. Barton. Ms. Heist, you look like you want to say
    something.
        Ms. Heist. Thank you, sir. We have done some work. We have
    not to this date identified----
        Mr. Barton. Pull the microphone close to you.
        Ms. Heist. We have done some minimal work in that area. We
    haven't found significant problems. We have looked at all the
    controls in place, and we have found them to be generally
    working well.
        Mr. Barton. When I was subcommittee chairman of this
    subcommittee, we did an audit of the FDA and the number of
    employees that had credit cards. And we found out that there
    were thousands, and we found out that there were no real
    controls, and we found out that one FDA employee purchased a
    Ford Mustang on an FDA credit card. So it might be worthy of
    some investigation because people being people, my guess is
    that lots of folks at EPA have credit cards--and not all, but
    some of them, probably abuse them.
        Ms. Bennett, are you aware of a title 42 program at EPA?
        Ms. Bennett. I am aware of the program.
        Mr. Barton. Do you support that program?
        Ms. Bennett. We have used the program for our highly
    trained and highly skilled scientists that we have primarily in
    our Office of Research and Development.
        Mr. Barton. Are you aware that the EPA union for the
    Washington region is opposing that program?
        Ms. Bennett. I am not aware of that.
        Mr. Barton. They are.
        Do you know what the compliance budget is at EPA?
        Ms. Bennett. The overall----
        Mr. Barton. For enforcement of existing regulations.
        Ms. Bennett. I can certainly access it, sure.
        Mr. Barton. Could either you or Mr. Elkins give us a
    ballpark figure what the compliance enforcement budget is? I
    mean, after all, that is really where the rubber meets the road
    in terms of protecting the environment. We know what the
    general budget is. Do you know, either one of you, what the
    compliance budget or enforcement budget is?
        Ms. Bennett. The Office of Enforcement and Compliance has a
    budget of over $600 million.
        Mr. Barton. $600 million. Is that up or down from the last
    year?
        Ms. Bennett. It is slightly up.
        Mr. Barton. Slightly up. In spite of all these mean-
    spirited Republicans who want to, according to my friends on
    the Democratic side, gut the EPA, the real heart of the EPA,
    enforcement and compliance, is up. Is that right?
        Ms. Bennett. We have proposed it to have an increase
    largely due to an initiative that we were redirecting funds
    toward in order to transition from paper reporting to
    electronic reporting in order to reduce burdens.
        Mr. Barton. Well, thank you for an honest answer. My last
    question, and I know my time has expired. I would like for the
    record, Ms. Bennett, to provide the number of enforcement
    actions that EPA has initiated in the last several years and
    the percentage of those enforcement actions that have resulted
    in fines being collected or criminal sentences being applied.
        Ms. Bennett. I would be happy to follow up with you.
        [The information appears at the conclusion of the hearing.]
        Mr. Barton. And if the Inspector General has information,
    we would like for you to provide that also.
        Mr. Elkins. I would be happy to.
        Mr. Barton. Thank you.
        Thank you, Mr. Chairman.
        Mr. Stearns. I thank the gentleman.
        The gentlelady from the Virgin Islands is recognized for 5
    minutes.
        Mrs. Christensen. Thank you, Mr. Chairman.
        Before I ask my question, I just wanted to say that I can
    see that from Ms. Bennett's testimony, that despite everything,
    EPA is making a good attempt to respond to the recommendations,
    and they are in the process of addressing issues that have been
    around for a very long time. And I really think you could
    probably do more of that if we didn't keep calling EPA up to
    the Hill every day and asking for report after report. I
    realize we have to do oversight, but I think we are overdoing
    it a bit.
        My questions are around the cuts to the EPA budget. The
    President has proposed a budget for EPA for 2012 that is $8.97
    billion. And it sounds like a lot of money. But when you put it
    in perspective, it is really just 0.06 percent of the total
    government debt, 0.26 percent of total government spending, and
    0.69 percent of the budget deficit. So we could really close
    down EPA and shudder the building and not make a dent in our
    overall budget deficit. But the ramifications for public health
    and the environment would be truly profound.
        This summer, the House appropriators proposed cutting EPA's
    budget by 20 percent below what the President requested for
    2012, and the President's request was low to begin with because
    it was already 13 percent below 2010 levels.
        Ms. Bennett, could you describe what impact these proposed
    Republican budget cuts would have on EPA's ability to implement
    and enforce the Clean Air Act?
        Ms. Bennett. Certainly that level of cut would make things
    very difficult. And in terms of our overall responsibilities,
    not just for the Clean Air Act but overall responsibilities, in
    particular there is a proposal of another $1 billion cut to the
    SRF budget as well as another I believe $100 million to State
    categorical grants and over another $100 million to the Great
    Lakes Initiative. So there would be a significant impact from
    that level of cut. And that budget would be lower than what we
    saw in 1998.
        Mrs. Christensen. So you might not be able to--you might
    have to reduce their quality monitoring also and might not be
    able to update your air quality standards in a timely manner?
        Ms. Bennett. We would certainly have to look at what we
    would have to be able to discontinue or what we would be able
    to afford at that time.
        Mrs. Christensen. And what impact would these proposed
    budget cuts have on EPA's ability to implement and enforce the
    Safe Drinking Water Act?
        Ms. Bennett. Well, again, I believe that the proposal would
    be to reduce the SRF by a combined billion dollars, and
    therefore, it would be reduced dramatically if it were on a pro
    rata basis.
        Mrs. Christensen. I want to note that the Drinking Water
    State Revolving Fund helps utilities deal with costs of meeting
    drinking water standards and repairing or replacing aging
    infrastructure, much of which is approaching the end of their
    useful life.
        The U.S. Conference of Mayors estimates that this spending
    is an economic win-win because it creates jobs and spurs the
    economy while ensuring healthy drinking water.
        These budget cuts would also affect the pace of toxic waste
    clean-ups in communities across the country.
        Ms. Bennett, could you describe what these proposed budget
    cuts would have on EPA's ability to clean up the Nation's worst
    toxic waste sites?
        Ms. Bennett. There would be, again, as I understand how--
    you know, what has been proposed on that particular bill, is
    there would be an additional cut to Superfund, and there would
    be additional cuts to others, making it very difficult to
    continue the work that has been done.
        Mrs. Christensen. And you know, since it has been reported
    that maybe around 60 percent of some of these toxic waste sites
    are adjacent to minority communities, we would be extremely
    concerned about that.
        But EPA's budget is a drop in the Federal budget bucket. I
    am sure EPA could identify additional efficiencies and trim the
    budget along the margins, but overall, EPA is trying to
    accomplish big goals with limited funds, protecting America's
    water supply and air quality, taking action on climate change
    and protecting all Americans from dangerous toxic chemicals.
        So we shouldn't be fooled by Republican rhetoric about the
    budget here. This is the most anti-environmental Congress in
    history any way you look at it. It shows that in their effort
    to pass legislation that would weaken the Clean Air Act and the
    Clean Water Act, and it shows in the massive and damaging
    budget cuts that they have proposed to the EPA.
        And with that, Mr. Chairman, I will yield back the balance
    of my time.
        Mr. Stearns. The gentlelady yields back.
        The gentleman from Nebraska, Mr. Terry, is recognized for 5
    minutes.
        Mr. Terry. Thank you, Mr. Chairman.
        I have a little personal experience in the State of
    Nebraska regarding the State Revolving Fund. For example, a
    battle that we had with some of the EPA folks in rural Nebraska
    just a few years ago were on copper pipes. And what happens is
    the groundwater is a little higher acidic, and so when it sits
    in the pipe, it draws out some of the copper.
        The mandate from the EPA was to put in a water treatment
    facility. It would have been a fraction of the cost for one of
    these small times--some of these small towns to just go out and
    rip out on city dollar or little town dollars all copper pipes
    and replace them, but those weren't options. We put those on
    the table, and they were rejected by the EPA.
        So sometimes a water treatment facility is the least
    efficient, most expensive but yet the one that was mandated.
    Those are the type of lack of commonsense over-zealousness that
    we are looking at here. So perhaps at least from Nebraska, the
    revolving fund for the drinking water is not exactly the
    example to use to show how mean and anti-environmental the
    Republicans are.
        Now, reading through these reports, especially GAO, it
    talks about many areas where there are redundancies, divided
    responsibilities. And what we are trying to figure out, is
    there a way to make you, the EPA, leaner.
        So when you, Ms. Bennett, Honorable Bennett, mentioned that
    there were worthy projects that have been cut, you mentioned
    drinking water along the U.S.-Mexican border. Mr. Trimble also
    mentioned a drinking water project along the Mexican border
    which they felt was inefficient. Is that the same one that you
    said was cut?
        Ms. Bennett. It is the same program. I believe, if I--I
    think it is the same program because I am only aware of one.
        Mr. Terry. You probably should put it in full context that
    that was also one that was declared by GAO as one that was
    inefficient.
        Could you do the subcommittee here a favor as we are trying
    to make you a leaner, more efficient agency to accomplish your
    legislative goals, or goals that Congress has set out for you,
    could you provide us an itemization of all projects that have
    been cut or eliminated in the last 2 fiscal years?
        Ms. Bennett. In the----
        Mr. Terry. Could you provide that? That is a yes or no.
        Ms. Bennett. Well, in the budgets that we have submitted to
    Congress, there is a list----
        Mr. Terry. OK.
        Ms. Bennett (continuing). Of terminations that already
    exist.
        Mr. Terry. All right. Well, that is looking--what I am
    trying to figure out is, you gave me an example of two that
    were cut. As I understand from this whisper in my ear, that the
    budget gives us the proposed ones. I am looking backwards to
    see which ones were actually cut or eliminated. Could you
    provide ones that were actually in the last 2 fiscal years cut
    or eliminated?
        Ms. Bennett. I will be happy to get back to you on that.
        [The information appears at the conclusion of the hearing.]
        Mr. Terry. Thank you very much. Now, in the--very bland. We
    get it; this is just a balance sheet, and because it is so
    bland, it lacks a lot of data. Of course, the data is in a 6-
    inch spiral notebook, but on the unexpended appropriations/
    other funds in note 17, can you itemize for us what programs
    where they have the leftover unspent funds?
        Ms. Bennett. The unliquidated obligations, yes. What we----
        Mr. Terry. Tomato-tomato, yes.
        Ms. Bennett. Well, the reason I state that is because there
    is a difference between unobligated funds and unliquidated
    obligations. And I just want to make sure that we are talking
    about the same thing. And this line reflects the unliquidated
    obligations or the unspent funds that have been obligated. This
    year my office instituted a tool for the Agency to be able to--
    --
        Mr. Terry. OK. My time is up, so would you, could you,
    provide a list of those unliquidated, which we call unexpended?
    And also the next line, cumulative results of operation earmark
    funds, I am kind of curious about that. Could you give us a
    list of the earmarks of which there are unspent, unliquidated
    funds?
        Ms. Bennett. We will be happy to get back to you.
        [The information appears at the conclusion of the hearing.]
        Mr. Terry. Thank you. That is the perfect answer.
        Ms. DeGette. Mr. Chairman, I ask unanimous consent that Ms.
    Bennett be able to finish the answer she was trying to give
    about the tool of her office.
        Mr. Stearns. Sure. Go ahead.
        Mr. Terry. Can the gentlelady yield to me? I wasn't trying
    to be rude. I just had no time left.
        Ms. DeGette. No problem.
        Mr. Stearns. Ms. Bennett, go ahead and answer the question.
        Ms. Bennett. Well, I think it is important to note that the
    unliquidated obligations has been not only mentioned by the
    Inspector General and GAO, but I know that when I came on board
    wanted to tackle it myself. So my office this year, I know I
    have put a real renewed focus on looking at unliquidated
    obligations. We instituted a new tool and provided new guidance
    to the Agency so that every unliquidated obligation was
    reviewed on at least an annual basis, and they have to send
    assurances to me that they have done so.
        And by virtue of that tool, we have been able to reduce the
    unliquidated obligations by over 50 percent in 1 year alone. So
    we recognize that this is an issue. We recognize this is an
    important budget item. And it is important for me as CFO to
    make sure that funds are not only used properly, but they are
    expended in the most efficient and effective way.
        Mr. Stearns. All right.
        The gentlelady from Florida, Ms. Castor, is recognized for
    5 minutes.
        Ms. Castor. Thank you, Mr. Chairman.
        And thank you very much. I am very concerned that a lot of
    these cuts are going to harm jobs and the ability of
    communities across the country to improve the environmental
    conditions. And it is interesting that we just had this
    conversation on the unliquidated obligations.
        The mayor of Tampa on October 6th received a letter from
    the EPA, from Stanley Meiburg, the deputy regional
    administrator, that says, we regret to inform you that the U.S.
    EPA will not be able to award the City of Tampa $1.25 million
    for the project regarding sediment removal from estuaries, the
    headwaters of the canal that are at issue. This is a matter
    that the city, the residents, the EPA and the State has been
    working on for years. It is a grant the city received some
    years ago. Sometimes these initiatives do take time. There are
    some issues here with State permits.
        I don't understand how the EPA, understanding all of the
    actions that have gone on, on an issue like this, all of the
    reliance on the grant funds, the moneys expended--I mean, we
    have got an engineering firm that has already expended about
    $600,000. We have another contractor that has expended about
    $22,000. And EPA said that they are not going to live up to
    their end of the bargain--they are on the hook, or the deal was
    that they would pay 55 percent of this clean water initiative
    and the City of Tampa would pay 45 percent. This has been an
    understanding for many years.
        Will you explain to me how this could happen, how the EPA
    could just after all the years of work on this, how the EPA
    could renege on the deal and take back the money that we have
    relied on?
        Ms. Bennett. Ms. Castor, that is a very good example of
    very worthy projects that end up having to be cut. In the 2011
    budget that we received in appropriations, we were directed by
    Congress to rescind $140 million of unobligated funds in a
    particular account, and that particular account was the State
    and tribal assistance grant. We did not have a choice as to
    which appropriation account. And we were also further directed
    that it must come from unobligated funds.
        So we attempted to try to be as fair as possible,
    recognizing that there are so many good projects on those
    lists. But we went back and went to the oldest unobligated
    funds that we had in that category and came up with the $140
    million of unobligated funds that were 2008 or earlier. And it
    sounds like, I am afraid, that that particular one was one of
    them.
        Ms. Castor. But we have relied on it. The city has expended
    money. People have been hired. They are ready to begin the
    project next year. Doesn't EPA owe us at least the portion of
    the funds that have been expended to date? And I would argue
    all of it.
        Ms. Bennett. We were left with very little latitude in
    terms of how we had to take the cut to the budget.
        Ms. Castor. So these jobs are just going to go away.
        See, now this is a real world example of how when you do
    things irrationally, it really hurts jobs, and it hurts the
    environmental quality of our community. We have been working on
    this for years and years and years.
        And it is just, it is unconscionable that these kind of
    cuts would have an impact on jobs and the environmental quality
    in my community.
        And I am going to leave these materials with you and want
    to talk to you all at greater length about at least covering
    the portion of the moneys that have been expended to date.
        Explain that discrepancy. How come EPA doesn't recognize
    that, OK, to date, we have spent over $600,000 on this and at
    least that portion should be covered?
        Ms. Bennett. Again, my--I had very little latitude in terms
    of how we were to cover the cut. We looked at the funds that
    had not been obligated. These were unobligated earmarks from
    many years ago. And so we tried to apply them as fairly as
    possible, recognizing when you cut funds, real projects get
    hurt.
        Ms. Castor. Real projects, real jobs, the expectations of a
    community for many years.
        Ms. Bennett. Yes. And there was a $140 million recision
    across that had to be taken, and it was taken across the
    country. And I appreciate your concern on that.
        Mr. Stearns. The gentlelady's time has expired.
        The gentleman from Texas, Dr. Burgess, is recognized for 5
    minutes.
        Mr. Burgess. Thank you, Mr. Chairman.
        Ms. Bennett, let me just ask you a question. And I
    appreciate these problems that we are talking about at the EPA
    are longstanding and long in degeneration. And your tenure
    there began when?
        Ms. Bennett. The end of 2009, so I am coming up on 2 years.
        Mr. Burgess. OK. My deepest sympathy.
        But you were a CFO in the real world at one time, is that
    not correct?
        Ms. Bennett. Indeed, I was.
        Mr. Burgess. And I appreciate the problem that the
    representative from Florida just articulated. That is very
    difficult at home.
        But on the other hand, as a CFO, I mean, you understand
    when you see the net position unexpended appropriations $13.5
    billion in an agency that has an $8 billion-a-year budget, and
    that is one and a half times your annual budget, I mean, that
    becomes an attractive target, especially in a time when budget
    cuts are happening all over the place. So you see the problem
    there; with your CFO eyes, you see that problem, correct?
        Ms. Bennett. And that is why I put a real renewed focus on
    it this year. My staff will tell you that it is what I talk
    about an awful lot in terms of making sure that the funds are
    used effectively and efficiently and most expeditiously.
        Mr. Burgess. Well, and I would just second Mr. Terry's
    request that we get the details of that and the details of the
    next line, the earmarked funds, because I think that is going
    to be very important in helping us foster an understanding of
    just what is going on here.
        Mr. Barton's request that the credit card statements be
    reviewed I think is rational. If someone is buying automobiles,
    we at least want to make sure they are buying hybrids, not
    mustangs, because we all know the EPA rating for a mustang on
    miles per gallon is pretty high.
        You know, on the GAO report, and again, I am asking you to
    look at this with your CFO eyes, here I am looking at the
    management of EPA's workload, workforce and real property, and
    the paragraph begins, with respect to workload and workforce,
    EPA has struggled for years to identify its human resource
    needs and deploy the staff throughout the Agency in a manner
    that would do the most good. OK. Fair enough. You have only
    been there for 2 years. This is a problem that is longstanding.
        But, I mean, this is the stuff that really gets you. EPA
    requested funding and staffing through incremental adjustments
    based largely on historical precedent. That means our budget
    was X last year for this, and it is going to be X-plus for this
    year. And instead of going back and evaluating what you really
    need to do the job to do the most good for the most people, you
    simply take what happened last time and add to it. Is that what
    is going on here? Is that what the GAO is referencing?
        Ms. Bennett. The approach that I take to the budget process
    is not on an incremental basis.
        The direction that we give is to look at the programs and
    to use subject matter experts to determine the level of
    funding.
        That said, I also recognize that the reports that GAO has
    come forward with, with the workload, and that it has been a
    long time in coming. I will tell you that when I asked about
    the reports and what they referenced, what I was trying to
    balance was a prior report on workload had indicated that we
    might need as many as 3,000 additional people. And I didn't
    feel that that was going to be an effective way----
        Mr. Burgess. No, it was not. I am going to interrupt you,
    only because of the interest of time. But the problem is the
    reports we have in front of us, the Inspector General's report,
    the GAO report, I mean, this same theme repeats itself over and
    over again. In the IG report, the comments about the
    information technology, that it has taken a long time and a lot
    of extra money to get that right, and no one even knows how
    many work stations and how many computers. You are a CFO.
        I mean, that is pretty basic. I am just a simple country
    doctor, but that seems to me to be CFO 101 stuff. Is that a
    correct interpretation?
        Ms. Bennett. It is definitely something that a CFO,
    including myself, takes very seriously, and why I am working
    with both the Inspector General and the GAO to make sure that
    we are addressing those recommendations.
        Mr. Burgess. Well, in the last Congress, we heard from the
    Office of Water, and the IG's report at that time brought up
    that the Office of Water had more un- implemented
    recommendations by the IG's office than any other branch. And I
    looked at the result as of March 31, 2011, and it is the same
    thing, Office of Water stands out as having more unimplemented
    obligations.
        Let me just ask you this, Lisa Jackson, Administrator
    Jackson, last summer convened a group of folks and said we got
    to get ready for the budget cuts; is that correct? I have a
    news report here somewhere that references that from I think
    July 19.
        Ms. Bennett. We need to get--we were preparing to go
    through the budget process.
        Mr. Burgess. Could you get us a list of the programs that
    were identified as most essential from that meeting? Did the
    meeting take place? I assume it did.
        Ms. Bennett. We had a discussion at the meeting.
        Mr. Burgess. Did you generate a list of the programs that
    were most essential or least essential?
        Ms. Bennett. We provided a lot of analysis during that time
    in terms of how we go about in making decisions in terms--you
    know, predecisional type of----
        Mr. Burgess. Would you be willing to share with this
    committee the results of that meeting?
        Ms. Bennett. Well, predecisional meetings--excuse me,
    predecisional materials are typically not provided.
        Mr. Burgess. But you had a meeting. And were there no
    action items then coming out of this meeting last July?
        Ms. Bennett. The action items that are in reference to the
    meeting in July and conversations since then were for the
    presentation of the 2013 budget, which is still not complete.
        Mr. Burgess. Well, I think this committee probably does
    have the ability to see the predecisional material, the right
    to see the predecisional material. And I would ask you when you
    go back to see if you cannot make that information available to
    the committee. Because just like you, we are faced with tough
    choices, too. The water quality things on the Texas-Mexico
    border, I mean, that is far away from my district, but I have
    visited the Colonias; I know the problem that they have. And if
    the problem was that you guys didn't study what you actually
    needed before you started pumping money in and now you feel
    that it is being wasted, that is a huge problem, and we need to
    get to the bottom of it.
        So I thank you, Mr. Chairman, for your indulgence. I would
    ask that the predecisional materials be made available to the
    committee and committee staff. And I yield back the balance of
    my time.
        [The information appears at the conclusion of the hearing.]
        Mr. Stearns. The gentleman from Texas, Mr. Green, is
    recognized for 5 minutes.
        Mr. Green. Thank you, Mr. Chairman.
        I thank our panel for being here today. And if you don't
    mind let me go over, I know what you all have to do on the
    executive branch budgeting, but we also have some
    responsibilities on our congressional budgeting process that I
    think needs to be concerned. In fact, I served many years in
    the legislature, and our Governor sent us a budget, but we
    immediately threw it in the trash can and drew our own, which
    is typically what Congress will do. If you like the President's
    budget, you talk about it. If you don't, you go ahead and draft
    your own.
        The focus today is on the budgeting of the executive
    branch, but Congress plays a role. In fact, as Democrats on
    this subcommittee and a bipartisan witness made clear at last
    week's hearing, the Constitution vests primary responsibility
    in Congress. In carrying out that constitutional duty and
    responding to requirements of the Budget Act, once a President
    submits its budget to Congress in February, we are supposed to
    hold hearings on it, authorizing committees are supposed to
    pass their views and estimates and send them to the budget
    committees. And then Budget Committees are supposed to produce
    a budget resolution. Once we have a budget resolution, the
    Appropriations Committee should begin work on appropriation
    bills; the authorizing committee begin work on reconciliation
    instructions contained in the budget resolution.
        Before the fiscal year begins on October 1, 12 separate
    appropriations bills are supposed to be considered, debated and
    passed by both Houses of Congress and signed by the President.
    But that has not happened--I am trying to think of how many
    years it has been since we have had it happen. To the contrary,
    over the last year, Congress has funded the government through
    a series of continuing resolutions, most recently one that
    lasted only a few days. And I can't imagine that this approach
    to budgeting enhances the efficiency of our Federal Government.
        Ms. Bennett, what impact do these short-term continuing
    resolutions have on your agency's ability to carry out its
    mission, whether it be contracting, grant writing, hiring,
    delay in projects or, particularly, cleaning up the
    environment?
        Ms. Bennett. Short-term CRs make it very difficult to
    implement programs, especially when they are multiple and very
    short in nature. It makes it very difficult to decide what to
    do because you are not sure how much money you are going to
    have. And I know certainly from my experience in the private
    sector, it would make it very difficult to operate a business.
        Mr. Green. Well, it seems like, I mean, EPA is a smaller
    agency compared to GAO and even DOD. Twice in the last 6
    months, our majority in the House has brought the government to
    a brink of a shutdown, once threatening a default on the
    Nation's loan obligations. What impact do these shutdown
    threats have on efficient and effective agency operations?
        Ms. Bennett. Well, certainly when the workforce is looking
    at a possible shutdown, we--you know, a lot of work is just put
    on hold to determine what we can do.
        Mr. Green. If you will be there the next day, in some
    cases.
        Ms. Bennett. Exactly. And a very anxious workforce, as well
    as trying to determine what we are actually legally able to do
    in terms of a shutdown.
        Mr. Green. In your agency, would your agency be better able
    to act efficiently and effectively if Congress fulfilled its
    statutory duties under the Budget Act and passed not only all
    of the appropriations but maybe just a few on time?
        Ms. Bennett. It would certainly--to have a budget that is
    approved on time would certainly be helpful.
        Mr. Green. Well, and I know a lot of us came out of the
    business sector, and it is amazing how we couldn't run a small
    business where I was at not knowing what we may be able to do.
    Congress certainly has an oversight to play with respect to the
    federal budget, but it also has a constitutional duty to
    respond to the President's budget proposals in good faith and
    ensure that the budget emerges from Congress in a manner that
    promotes administrative efficiency and programmatic
    effectiveness. I think maybe Congress ought to be looking at
    our responsibility on doing that, whether it is this committee
    or any other committee, particularly Appropriations and Budget
    Committee.
        And with that, Mr. Chairman, I will be glad to yield my
    time to our ranking member if she has any other questions.
        No?
        Mr. Stearns. The gentleman yields back the balance of his
    time.
        And the gentleman from Virginia, Mr. Griffith, is
    recognized for five minutes.
        Mr. Griffith. Thank you, Mr. Chairman.
        I noted with some interest that you indicated, Ms. Bennett,
    that the $13 billion in unexpended appropriations, I think your
    words were, may be more than 5 years in implementation; some of
    these commitments may have been made more than 5 years ago. And
    I am curious about that, because I guess what I am hearing is,
    and I need you to tell me if I am incorrect, is that sometimes
    to get complicated projects done and to do things in the right
    way and to make sure that you are doing them in the most
    efficient way possible, it takes more than 5 years to get some
    of these projects done. Would that be an accurate statement?
        Ms. Bennett. Well, I think that many projects can take more
    than a few years.
        Mr. Griffith. And so I guess what I am trying to figure
    out, and I know it is not really your role, so I will make it
    more of a rhetorical question is, why would the EPA oppose H.R.
    2250, which would give businesses 5 years in order to comply
    with new regulations from the EPA? I leave that as a rhetorical
    question. But I do note with some interest that the EPA is not
    able to follow the rules that they oppose for businesses.
        And I would then point out to you that I also have heard a
    lot of talk about wastewater and safe drinking water programs
    and so forth and that a lot of those may be in here. And I will
    tell you of an incident, because this may be part of the
    problem, that has been brought to my attention recently where
    without having the cooperation that we heard is not going on,
    various agencies of the State and Federal, including the EPA,
    came up with different rules, and some areas were trying to
    work on these very issues, safe drinking water and wastewater,
    and the big impediment to getting them done in a timely fashion
    and what ended up costing more money were not having the
    flexibility, like Mr. Terry pointed out, not the exact same
    situation, but not having flexibility from the EPA and others,
    and different people coming in and telling folks different
    things. And so they had the construction crews there ready to
    go, and then all of a sudden somebody comes in and says, wait a
    minute, you haven't done X. And not looking at practical
    solutions to the problem and just to note you have got to
    follow this strict rule, that project was then delayed and cost
    the community additional moneys. And it may very well be one of
    your 13 billion programs because they are trying hard to both
    bring safe drinking water and wastewater programs into my
    district, but also to comply with the regulations put on them
    trying to get those projects completed by the EPA.
        And so I would ask that you do work very hard to make sure
    that you get that cooperation going. Because when you don't
    have the cooperation, folks actually have let the contracts and
    have the bulldozers sitting there, that equipment costs money
    to have sitting there while they try then to comply with
    something new that was thrown at them at the last minute.
        So I encourage you to encourage the EPA to do that. I also
    would have to ask, in regard to figuring out the staffing, and
    I guess I am going to switch to Mr. Elkins, would I be correct
    that when you are saying that you need to know what kind of
    staffing needs you have and that there hadn't been a study and
    you really need to have a study be akin to trying to run a
    McDonalds and not know when your peak periods were for that
    particular community and neighborhood and how many employees
    you needed to have and so then maybe you over staff all the
    time to make sure you can meet the peak demands? If you don't
    have the accurate information, how many people it takes to get
    lunch served in that particular community, isn't it true you
    are libel to have more employees than you need in order to meet
    the peak periods?
        Mr. Elkins. That would be a fair conclusion, yes.
        Mr. Griffith. And is that the same kind of situation, not
    that EPA is trying to meet the lunch crowd, but the similar
    type of thing that they may not have the right number of people
    in the right locations and they may actually be over staffing?
        Mr. Elkins. That is a fair conclusion, yes.
        Mr. Griffith. All right. Thank you very much.
        And in regard to the rent, is it possible that EPA could
    look for cheaper accommodations? I have noticed they have some
    of the nicest buildings as I come into Washington every week.
    Is it possible they could move to cheaper accommodations?
        Mr. Elkins. Well, I would assume anything is possible.
        Mr. Griffith. All right. If I indicated to you that we have
    lots of empty space in the Ninth Congressional District of
    Virginia and that that is actually close to an area that EPA
    seems to be focused a lot of attention on, the coal mining
    region of the Central Appalachians, it would seem to make
    sense--and we might not want them close, but they might
    understand some of the issues better. If I told you the rent
    down there is a whole lot cheaper than Washington, they could
    save some money that way, couldn't they?
        Mr. Elkins. You know, that may be a little bit----
        Mr. Griffith. It would have to be studied I assume?
        Mr. Elkins. Yes.
        Mr. Griffith. In regard to the 37 labs, I heard something
    that I don't understand, and there was 37 labs, but it was like
    115 buildings. Can you explain that to me, Mr. Trimble?
        Mr. Trimble. Yes, 37 labs, but they have 170 buildings or
    facilities. So some of those may not be full office buildings
    or lab facilities but smaller operations as well. So it is
    about 170 located in 30 cities, all operating under 15
    different managers.
        Mr. Griffith. And I think the conclusion that you have
    made, and I think most people would make, is that there ought
    to be some room for consolidation; you might not need 15, but
    you might need 7 or 8 managers----
        Mr. Trimble. Well, I think we are agnostic on whether you
    need consolidation as much as that it is you need the
    information to know whether you have the right number and in
    the right place and the right skill sets. And if you are doing
    workforce planning, you need to manage entire portfolios and
    integrated portfolios as opposed to sort of stovepiped.
        Mr. Griffith. All right. I appreciate that. And I see that
    my time is up, and I yield back my time.
        Mr. Stearns. The gentleman yields back his time.
        Mr. Scalise is recognized for 5 minutes.
        Mr. Scalise. Thank you, Mr. Chairman.
        I appreciate the panelists coming to talk about the budget.
    I know one of my colleagues on the other side was lamenting the
    failure to pass a budget, and I would share that concern. I
    know right, not 3 months after this Republican majority came
    into Congress, we passed a budget over to the Senate. It has
    been nearly 3 years since the Senate has passed a budget of any
    kind. They took up our budget, voted it down. They took up the
    President's budget and didn't even get one vote, not one vote
    in the United States Senate for the President's budget.
        So hopefully our friends over in the Senate will finally
    start doing their job that we have already done over here. And
    if they don't like our budget, pass one of their own that they
    can pass. But it has been almost 3 years, so I would imagine
    you almost have some frustrations with that as well.
        When we are talking about--you know, you have mentioned
    cuts. When I look at your budget, when President Obama took
    office, it was around $7.5 billion. Is that correct? Is that a
    ballpark?
        Ms. Bennett. In 2009, it was $7.6 billion.
        Mr. Scalise. And today, what is your budget?
        Ms. Bennett. In 2011, it was just under $8.7 billion.
        Mr. Scalise. So your budget has actually gone up over $1
    billion. How is that a cut?
        Ms. Bennett. From 2009, it was not a cut.
        Mr. Scalise. So you had a $7.5 billion budget 2 years ago.
    Every State, I know in my State, pretty much every State that I
    have been following, they are actually cutting the size of
    their budget.
        You talk to families who are struggling in these tough
    times, most families have been cutting back over the last 2
    years. And yet you have got over $1 billion increase in your
    budget over the last 2 years, and you are complaining that you
    are cut somehow. I mean, maybe in Washington that is a cut. But
    when you look at your budget 2 years ago, you look at what
    States have dealt with, what families have dealt with, you have
    actually got more than $1 billion increase over that time, and
    you are somehow calling that a cut that is hurting health.
        Ms. Bennett. Actually, in terms of the overall budget, from
    2000 to 2009, there was no increase in EPA's budget from those
    2 years----
        Mr. Scalise. Well, we are looking at the 2 and a half years
    going back to when President Obama took office.
        Ms. Bennett. And in 2010, there was a large increase in two
    particular areas in particular.
        Mr. Scalise. And I hope you would understand that we are
    living in the real world. And you know you talk to families;
    when we go back home and meet with our small business owners,
    they are cutting back. They want to reinvest in their business
    and create jobs. And frankly, EPA has been the main source of
    job losses when you talk to a lot of our small businesses. They
    say it is the things that you all are doing, some of these new
    regulations that are coming out, that are making it impossible
    for them to create jobs in the real world. And I hope you would
    understand that it is kind of hard for a lot of those
    businesses and families that are struggling, and they are
    cutting back. They want to create jobs, but they can't because
    of the some of the rules you are sending out. You actually had
    an increase of $1 billion compared to 2 years ago, and you are
    trying to complain to us that you got a cut. And so I just want
    to put that on the record because clearly, you go from $7.5
    billion 2 years ago to over $8.5 billion today; that is not a
    cut. I mean, are those numbers correct?
        Ms. Bennett. And the increase of the SRFs and to the Great
    Lakes are for the most part straight passthroughs to the States
    and to the communities.
        Mr. Scalise. And so again, like I said, a lot of people
    struggling out there. They would be more than happy to have
    that kind of increase, more than a 10 percent increase, over a
    2-year period.
        When we look at some of the things that are in this report,
    when you go to the properties, in your testimony, let's see
    right here, Ms. Bennett, your testimony on page 3, you said
    that you all have released approximately 375,000 square feet of
    facilities, resulting in cumulative annual rent avoidance of
    over $12.5 million. By rent avoidance, you mean----
        Ms. Bennett. We are not incurring it.
        Mr. Scalise (continuing). You reduced the amount of space.
    But then when I look at the Inspector General's report, it says
    you are spending probably somewhere around $300 million a year.
    In some cases, you have got buildings where you have one or two
    EPA employees for that whole building. Have you seen that in
    the Inspector General's report?
        Ms. Bennett. I have. We do have a number of facilities. We
    have not only a number of office facilities, we have, as Mr.
    Trimble has mentioned, we have a number of labs, and we have a
    number of warehouses. The field offices that have one or two
    people, I have recently directed that we have a review of all
    offices that have less than 10 people, in order to make sure
    that we continue to need them, and with the new technology that
    is available, that perhaps we have more----
        Mr. Scalise. OK. And you go on to say you plan to further
    reduce energy utilization. Maybe you can get some of those
    extra Solyndra solar panels to put on the roof and maybe we can
    get something to show for that $535 million we might be on the
    hook for.
        Going to the audited report, the EPA audited report, and I
    know I am running low on time, so I am just going to ask these
    quick questions and see if you can give me the details. On page
    33, unpaid obligations looks like $13.8 billion. If you can get
    me a breakdown or get the committee a breakdown of what that
    really means, because we don't have anything beyond just one
    line that says unpaid obligations, $13.8 billion. Undelivered
    orders, $12.8 billion, if you can get the committee a breakdown
    of that. And finally, unexpired, on page 71, unexpired
    unobligated balance, $4.4 billion, if you could get the
    committee details about what that really is, because it doesn't
    give it to us in this audit. Thank you.
        And I yield back, Mr. Chairman.
        Mr. Griffith. [presiding.] Thank you.
        And the gentleman from Colorado, Mr. Gardner, is recognized
    for 5 minutes.
        Mr. Gardner. Thank you, Mr. Chairman.
        And thank you as well for the witnesses their time to join
    us today.
        And so just to follow up on Mr. Scalise's questions, the
    EPA funding has increased then over the last 2 years.
        Ms. Bennett. Since 2009, it has increased.
        Mr. Gardner. It has increased. OK. Thank you for that. And
    you had mentioned earlier there is about 17,200 employees at
    the EPA, or at least that was in the request.
        Ms. Bennett. That we requested in 2012.
        Mr. Gardner. What percentage or what number of those are
    actually involved in writing regulations?
        Ms. Bennett. Off the top of my head, I am not sure, but I
    would be happy to get back to you on that.
        [The information appears at the conclusion of the hearing.]
        Mr. Gardner. If you can get back to me and let us know how
    many of those are involved in writing regulations, I would
    appreciate it. And do you anticipate a budget being passed by
    the Senate this year, and if so, what would that number be?
        Ms. Bennett. I don't think I will answer that one.
        Mr. Gardner. Is that because you don't think they will pass
    one?
        Ms. Bennett. No, because I think that is not my decision.
        Mr. Gardner. And if you could ballpark the number of
    mandates that are coming out of the EPA on various drinking
    water regulations, on various municipal treatment, sewage
    treatment regulations, excuse me, regulations that are going
    out to local municipalities when it comes to drinking water
    treatment and sewer treatment, do you have an idea of the
    unfunded mandate, the level of unfunded mandates right now?
        Ms. Bennett. My responsibility as CFO is to ensure the
    financial integrity of the EPA's budget. And so----
        Mr. Gardner. You are not involved in those, OK.
        Ms. Bennett. I am not involved.
        Mr. Gardner. Then going back to that question, of this
    $13.3 billion that has been discussed at length today, that is
    not in the budget justification submitted to Congress, is that
    correct?
        Ms. Bennett. No. And that is a figure that is a year old.
        Mr. Gardner. And so what would that figure be today?
        Ms. Bennett. We are still closing the books. I don't have
    the number for you.
        Mr. Gardner. But surely you know what has been spent out of
    that as the year goes. I mean, you keep a running tally of how
    much money you spend out of that.
        Ms. Bennett. I would have to get back to you on that. Off
    the top of my head, I don't know the figure. But we have looked
    at the unliquidated obligations, which is the same thing as the
    unexpended obligations, and have done and implemented a tool
    that allows for us to be able to review all of the unliquidated
    obligations and see what we might be able to de-obligate and
    either recertify or return back.
        Mr. Gardner. And that has been implemented now?
        Ms. Bennett. My office implemented it this year in 2011.
        Mr. Gardner. But you still don't not know how much of the
    $13.3 billion is left?
        Ms. Bennett. Off the top of my head, I do not.
        Mr. Gardner. Even though that tool has been implemented?
        Ms. Bennett. I don't have the tool in front of me at this
    particular moment.
        Mr. Gardner. So it is still something that you don't know
    about $13.3 billion where it is or how it is being spent or how
    much is being left?
        Ms. Bennett. I would have to get back to you on that.
        Mr. Gardner. Mr. Trimble, does EPA have access to that
    $13.3 billion for other program use?
        Mr. Trimble. I have not--we have not looked at the balance
    sheet, so I really couldn't speak to that. I could probably
    come back to you with something----
        Mr. Gardner. Ms. Bennett, where is that $13.3 billion
    today?
        Ms. Bennett. We have already agreed that we would get back
    to you on the information in regards to that particular amount.
        But it reflects obligations that the Agency has made and
    for projects that are ongoing. And so we will be happy to get
    back with you on any more details.
        Mr. Gardner. And Mr. Elkins, do you know where that money--
    can they use that money, have access to that $13.3 billion for
    other programs?
        Mr. Elkins. Let me defer to Melissa Heist on that question.
        Ms. Heist. It varies by appropriation. Some can be made
    available and some would have to be returned, so it depends.
        Mr. Gardner. And when you say returned, who is that
    returned to?
        Ms. Heist. Well, the money hasn't actually been drawn down
    from the Treasury and has been sitting in EPA, so it would be
    available to be reappropriated, I guess.
        Ms. Bennett. Only if they are not----
        Ms. Heist. Some of it.
        Ms. Bennett [continuing]. Valid obligations.
        Ms. Heist. Exactly.
        Ms. Bennett. So if they haven't been drawn down and they
    would be--let's say there is some left over on a particular
    project, then they would be returned. If there is still time
    left in terms of the amount of money, excuse me, on the amount
    of time that could be used, they could be recertified and
    redeployed; otherwise, they would be returned to the Treasury.
        Mr. Gardner. And so recertified and redeployed, by that are
    you talking about on a new program, re-obligated for what it
    was initially offered for?
        Ms. Bennett. Re-obligated.
        Mr. Gardner. And so there is no way then for EPA to use
    that for other purposes within EPA?
        Ms. Heist. Some of it could be reused at EPA.
        Mr. Gardner. For different purposes than what they had
    originally?
        Ms. Heist. Well, it would have to be used for the purpose
    of which it was appropriated. So if it was for water projects,
    it would have to be used for water projects.
        Mr. Gardner. But maybe on a different water project?
        Ms. Heist. Yes.
        Mr. Gardner. And you will get information back to us on
    where that money is and how it is used?
        Ms. Bennett. We have agreed to follow up with you on it.
        Mr. Gardner. And can you give us some kind of a guarantee
    that you will put that into the budget justifications so that
    we have that information before us so we don't have to have a
    congressional hearing to find out what is happening with this
    money?
        Ms. Bennett. I will be happy to get back to you on it.
        Mr. Gardner. Mr. Chairman, I yield back my time.
        Mr. Griffith. If we will pause for a second, I will have
    the real chairman resume his position. Thank you.
        Mr. Stearns [presiding]. I thank the gentleman from
    Virginia.
        Ms. Bennett, my colleague, Dr. Burgess, requested the
    predecisional materials resulting from the July meeting called
    by Administrator Jackson. Can you please confirm for the record
    that the EPA will provide these materials to the committee?
        Ms. Bennett. It is not my decision as to the provision of
    predecisional meetings, but I will be happy to confer with OMB
    and inside the Agency. I certainly appreciate your interest in
    the issue and be happy to get back to you on it.
        Mr. Stearns. Mr. Trimble, does the EPA have access to funds
    that it does not report to Congress in its budget proposal?
        Mr. Trimble. Well, I think if this is in reference to
    monies that they have de-obligated and have recertified for
    other programs, yes. So, for example, if they have a grant or
    an interagency agreement that it has been closed and there are
    funds that have been left over, EPA, during the course of the
    year, can use those funds for other purposes within certain
    constraints.
        Mr. Stearns. How much money are we talking about? Has the
    amount of unexpended appropriations remained relatively
    constant?
        Mr. Trimble. I don't have a trend that I could give you. I
    know when we first started tracking this issue over 10 years
    ago, this was an area where the Agency was not doing a good
    job. They have done much better recently. I believe the last
    year I remember looking at this they had, the number they had
    repurposed was about $160 million.
        Mr. Stearns. Considering the large amounts of unexpended
    appropriation raises a question: Why isn't the EPA spending the
    money provided by Congress?
        Mr. Trimble. Well, in the moneys that we are talking about
    that we have looked at as part of our review of the budget
    justification requests, typically the moneys we are talking
    about are for programs where they did spend some of the money
    just not all of the money, for example a grant or an
    interagency agreement or a contract. They have carried out some
    of the work, or the contract was terminated earlier; it didn't
    cost as much, so there is money left over, so the contract is
    closed. And what our past work had shown is that they had
    done--been doing a good job of monitoring that and sweeping
    those moneys up to be used for other purposes. So over the
    years, the GAO plus the IG has been pressing the EPA on this.
    They have improved their tracking. What we have recommended or
    suggested is that when they have repurposed this money, it be
    transparent to the Hill so that you can consider that in your
    budget deliberations.
        Mr. Stearns. If the EPA is not spending the money, even you
    mentioned that they might cancel a contract and they had
    leftover funds.
        Mr. Trimble. Well, it could be that the reason they have
    the leftover money was the contract was cancelled. So, for
    example, a project is terminated or it is finished early, so
    they thought it was going to cost $10 million; it cost $5
    million. They complete the contract. You still have the money
    that was obligated, but they never spent it.
        Mr. Stearns. So what happens to that $5 million?
        Mr. Trimble. Well, it sits, unless they flag it and then
    deobligate it and then put it to another purpose. And those
    were the issues that we have been flagging over the past 10
    years.
        Mr. Stearns. Could they use that for next year's budget?
        Mr. Trimble. I think, depending, I defer to EPA on this,
    but I think you could, depending on some of your moneys, no,
    your money; some money may have a time limit on it.
        Mr. Stearns. Mr. Trimble, is it correct that GAO issued a
    report just this past July that identified challenges relating
    to EPA's management of its real property, namely property
    management identifying excess and underused property as an area
    where there may be budget savings for our Supercommittee?
        Mr. Trimble. I am not familiar with the work we have done
    for the supercommittee, but I believe that is----
        Mr. Stearns. I mean, just in general. You are stating there
    are areas where there is underused property, that we could save
    money, isn't that true?
        Mr. Trimble. Yes, I believe. And that is an area of high
    risk that we have identified for a long time for the Federal
    Government.
        Mr. Stearns. Isn't it also true that GAO found that the EPA
    did not have accurate and reliable information on the need of
    its facilities, property use, facility conditions and operating
    efficiencies?
        Mr. Trimble. Yes. Specifically that is in relation to its
    laboratory facilities.
        Mr. Stearns. Ms. Bennett, do you agree with what Mr.
    Trimble indicated that the GAO findings concerning the
    completeness and reliability of operating costs and other data
    needed to manage EPA properties are not there?
        Ms. Bennett. We certainly respect the findings of the GAO,
    and we are working toward addressing the issues and being able
    to improve on those issues.
        Mr. Stearns. Mr. Trimble, you referenced in your--let's see
    here, June 2010 Presidential memorandum that directed agencies
    to accelerate efforts to identify and eliminate excess
    properties to help achieve $3 billion in cost savings by 2012,
    is that correct?
        Mr. Trimble. That is correct.
        Mr. Stearns. Did EPA eliminate any of its laboratories or
    major assets as a result of that directive?
        Mr. Trimble. No. EPA told OMB that they needed all their
    lab facilities.
        Mr. Stearns. Let me see if I understand this. EPA tells the
    White House it doesn't have excess property, but GAO's own
    work, and EPA concurs, shows the Agency doesn't have accurate
    or reliable information to make this determination. Is that an
    accurate statement, Mr. Trimble?
        Mr. Trimble. Well, I don't know about the EPA concurring.
    At the time, the key factors that they needed to factor into
    the decision concerned need, usage, efficiency, cost, those are
    all the things called for by OMB for the analysis, and our
    review found that EPA's data in those areas was either
    incomplete or the accuracy was questionable.
        Mr. Stearns. Ms. Bennett, so the question for you is, how
    can EPA justify its response to the White House that it doesn't
    have duplicative or excess property when it doesn't have the
    data to support even their determination?
        Ms. Bennett. Well, in terms of the labs, for 2012, we have
    included in our President's budget request some funds in order
    to make sure that we properly look at the use and the skills
    that are necessary for the labs to see where we might be able
    to have additional efficiencies and where we might be able to
    save costs.
        Mr. Stearns. You see what I am saying, though. I mean, EPA
    is making this decision, and yet it is clear you don't even
    have the reliable information to make this decision, yet you
    are telling them----
        Ms. Bennett. And we are working on getting better
    information to make the decisions that are necessary.
        Mr. Stearns. How long is that going to take you?
        Ms. Bennett. The lab study that we hope to be undertaking
    pending appropriation would be done in 2012.
        Mr. Stearns. OK. My time is expired.
        Ms. DeGette. Mr. Trimble, I completely agree with the
    recommendation that for unexpended appropriations, which are
    actually going to go to a project and they are repurposed by
    the Agency, that needs to be transparent.
        And I am assuming, Ms. Bennett, you would agree with that
    as well.
        Ms. Bennett. Indeed.
        Ms. DeGette. And just so we can be clear for the record,
    Mr. Trimble, Ms. Bennett told us a little while ago that of
    this unexpended appropriation line, some of that is for
    projects that are coming down the pike. GAO doesn't object to
    any of that, right?
        Mr. Trimble. Yes. You know, I am not an accountant, so full
    disclosure here.
        Ms. DeGette. Me neither.
        Mr. Trimble. The numbers that GAO has been talking about
    are not the unexpended appropriations on this balance sheet. I
    believe, my understanding, and limited as it is, is that the
    balance sheet numbers may include, there may be obligations
    behind those numbers so it is just a matter of a timing issue
    in the spending.
        Ms. DeGette. Right. And the other thing is, for some of the
    appropriations, they might be appropriations that couldn't be
    redirected, depending on how broad or narrow they are, right?
        Mr. Trimble. Yes. And again, I would defer to----
        Ms. DeGette. You know, if it is an--I will ask Ms. Bennett.
    If it is an appropriation for like water projects and you
    didn't need it for this one, but for that one, you could
    repurpose that, right?
        Ms. Bennett. If it was within the same appropriation.
        Ms. DeGette. Right. But that is what we should know if you
    are doing that, right?
        Ms. Bennett. Exactly.
        Ms. DeGette. Yes. And then you might have an appropriation,
    though, for something else. You might not have, you may not be
    able to repurpose that because of the nature of the
    appropriation. That would revert to the Treasury, right?
        Ms. Bennett. If we cannot recertify, if we cannot find
    another project of a suitable nature----
        Ms. DeGette. Right.
        Ms. Bennett [continuing]. Then my understanding is it would
    go back to the Treasury.
        Ms. DeGette. Right. And does that happen?
        Ms. Bennett. It does.
        Ms. DeGette. OK. I think that is part of what the chairman
    is wanting to know, how much that happens. But just to be
    clear, this money that is on this balance sheet, or any other
    money that--it looks like a lot of money sitting there, $13
    billion or $14 billion, but that is not actually just a whole
    bunch of cash just sitting around that could be used to offset
    against next year's EPA appropriation. Much of that money is
    obligated, correct?
        Ms. Bennett. That money is obligated, so the government has
    an obligation to meet its contracts.
        Ms. DeGette. And when we just cut those funds of previously
    obligated money, what Congresswoman Castor was talking about,
    that is exactly the kind of thing that happens, is projects
    have to be eliminated, even sometimes projects that are
    underway, right?
        Ms. Bennett. Well, in her case, it was for projects that
    had not actually been obligated.
        Ms. DeGette. Oh, OK.
        Ms. Bennett. So those were those particular funds. So a
    contract had not been entered into. A grant had not been
    entered into her case. However, it still affected real work and
    real jobs, according to what she said.
        Ms. DeGette. They were counting on that money, even though
    it wasn't obligated, and then it got cut, right?
        Ms. Bennett. It was a very, very difficult decision.
        Ms. DeGette. OK. Thank you. Thank you very much, Mr.
    Chairman. And I want to thank all of these witnesses for
    coming. I think it is a really useful review.
        And as I mentioned in my--oh, well, as I mentioned in a
    side bar to you, Mr. Chairman, I think once the EPA completes
    this analysis of what they are going to do based on the IG's
    recommendations, that we should have a follow-up hearing, I
    think would be useful.
        I yield back.
        Mr. Stearns. I thank the gentlelady.
        Mr. Griffith from Virginia is recognized for 5 minutes.
        Mr. Griffith. Thank you, Mr. Chairman.
        The EPA has various initiatives like the American Great
    Outdoors Initiative, Green Power Partnership, the AgStar
    Program and the Energy Star, just to name a few. I was
    wondering if you can tell me, do you know how many voluntary
    programs there are at the EPA?
        Ms. Bennett. I know we have quite a few voluntary programs.
    The exact number I would have to follow back up with you on
    that.
        Mr. Griffith. And do you have an idea how much the Agency
    spends on the voluntary programs versus statutorily required
    programs?
        Ms. Bennett. Most of the funds go to statutorily required
    programs, but I don't know the exact----
        Mr. Griffith. All right. If you could give me the answers
    to both of those questions later, that would be greatly
    appreciated. Can you do that for us?
        Ms. Bennett. I believe I can. I will certainly follow up
    with you on it.
        [The information appears at the conclusion of the hearing.]
        Mr. Griffith. All right. And in its 2012 request, EPA
    proposed a $36 million reduction from nonpoint source pollution
    grants. However, at the same time, it proposed increases in
    other programs with a focus on nonpoint pollution, the
    Mississippi River Basin Initiative, Chesapeake Bay Program, et
    cetera. After review, it appears the EPA may be proposing to
    just move money from one account to another. Are these cuts
    real cuts, or is the EPA simply shifting the money from one of
    its programs to another?
        Ms. Bennett. I think you are referring to what we call the
    categorical grants in the STAG account. And indeed, the
    nonpoint source did sustain that--we are proposing a $36
    million cut. We had--part of our budget process is consultation
    with the States, with ECOS, and with the tribes. And based on
    that consultation, although the 319 program is a very important
    one, we also recognize that there were other categorical grants
    that they had indicated might be more important to them, and so
    we were trying to accommodate those requests.
        Mr. Griffith. Now, as a part of that cooperation that we
    heard about today from other witnesses, is it possible, do you
    think that the--because it looks like the USDA is doing the
    same work on nonpoint source that you all are doing, is there
    some way you all can get together and perhaps reduce the cost
    of working on the problem? I am not saying you shouldn't work
    on the problem, but reduce the cost of working on the problem
    by not duplicating that particular information, and have you
    all talked to the USDA about what they are doing so you can
    coordinate?
        Ms. Bennett. That was actually a factor in when we were
    making the decision in terms of how we would make trade-offs
    within those categorical grants working closely with USDA and
    seeing if we might be able to leverage our collective resources
    better.
        Mr. Trimble. Sir, if I may, just so you know, we have an
    ongoing review of the 319 program. And part of the scope of the
    review is to look at coordination with the USDA.
        Mr. Griffith. Let me ask you, in regards to this
    cooperation with the States, is that a real cooperation? Can
    any of you all answer that question for me? Because I just left
    the State legislature about a year ago, and it didn't feel much
    like cooperation when representatives of the EPA came down and
    told us what we were going to do and that we couldn't look
    for--again, as Mr. Terry said earlier and as I pointed out
    earlier, we couldn't look for more cost-effective ways to try
    to achieve the same purpose. We were going to have to follow
    one of two models that the EPA approved. Can anybody answer
    whether or not there is actual cooperation with the States? Or
    is it just being dictated to? Because that is the way I felt in
    Virginia.
        Mr. Trimble. Well, yes. I couldn't answer that, but
    broadly, I think in the 319 program, part of the review will
    look at its implementation and its structure throughout the
    State. So it may indirectly get at your question.
        Ms. Bennett. Mr. Griffith, strengthening the partnerships
    and the relationship with the States and the tribes is one of
    the administrator's seven priorities and one of our aspects in
    our strategic plan, one of the cross-cutting fundamental
    strategies that we have. So we are taking the relationship with
    the States very importantly.
        I know I have had several conversations with the State
    leadership and ECOS, in particular, on these unliquidated
    obligations and how we can move the money faster. So I know as
    the CFO, I am trying to take it very seriously, and the Agency
    has set a very high priority.
        Mr. Griffith. I appreciate that very much. I appreciate you
    all's time today. It has been very helpful. I appreciate the
    chairman having this hearing because I am learning lots, and I
    am new and a lot of these things I haven't heard before, so I
    appreciate it.
        And I yield back my time.
        Mr. Stearns. I thank the gentleman.
        The gentleman from Texas, Dr. Burgess, is recognized for 5
    minutes.
        Mr. Burgess. Thank you, Mr. Chairman.
        I just have a couple follow-up questions on the Title 42
    provisions. Now, Mr. Inspector General, have you studied the
    Title 42 provisions and the number of positions that the EPA is
    now employing under Title 42 guidelines?
        Ms. Heist. No, we have not looked at those.
        Mr. Burgess. Well, and you know Mr. Barton referenced that
    one of the unions was concerned. It is the National Treasury
    Employees Union. In fact, the data I have was supplied to them
    under a Freedom of Information Act request. It is not directly
    from the EPA, though it was the EPA's response to the Freedom
    of Information Act request filed National Treasury Employees
    Union. Well, just for an example, on the--and Ms. Bennett, you
    may not be able to tell us. But the starting salary or the
    salary that would be required to hire someone with a title of
    ``research microbiologist,'' what would the typical salary
    range for that be?
        Ms. Bennett. I am not able to say that. I do know that in
    any Title 42 hiring, a very rigorous process is undergone to
    ensure that those individuals are pertinent for that kind of a
    salary. If it is over and above the regular GS or SES
    schedule----
        Mr. Burgess. Did you try? I mean, we are in a recession.
    Everyone talks about, nobody can find a job. Did you try to
    fill it with someone who might be able to accept the normal GS
    scale for that position? Was it necessary to go to a Title 42?
        Ms. Bennett. As you suggested, I am not familiar with each
    individual one. But typically, as I understand, the Title 42s
    are used when other, you know, other avenues have been
    exhausted, and they can't be hired.
        Mr. Burgess. Well, again, I am having difficulty believing
    in this environment, where all the time we hear when people
    cannot find jobs, people are looking and they can't find them,
    I find it hard to believe that the position couldn't even be
    filled with an American citizen. That is troubling.
        Ms. Bennett. I am not familiar----
        Mr. Burgess. Well, I will provide you with some of this
    information, and I would like some of your feedback on that
    because I have been trying to get information on this program
    for quite some time. I recognize that it is occasionally
    necessary to go out and get someone with particular expertise.
    But you know, since your tenure started, it has been what,
    seven people that you have hired under Title 42 provisions,
    essentially doubling the number--almost doubling the number of
    hires under that provision from previous years. So I, again, in
    the worst recession the country has ever known, I would just
    ask the question, can we not find anyone suitably qualified who
    doesn't require the additional payment under Title 42
    provisions? And I will get you that information, and I would
    appreciate your attention to that.
        One other thing has come up, are there dollars that the EPA
    is spending in grants that are delivered to concerns overseas?
        Ms. Bennett. There has been a longstanding practice in the
    Agency and in the administration and several administrations to
    provide grants to some foreign entities.
        Mr. Burgess. But in this budgetary environment, does it
    make sense that we provide millions of dollars in grants to the
    Chinese Government--I mean, they can certainly afford their own
    research--supporting projects related to coal mine methane
    utilization. I mean, it seems like that is something they would
    want to do on their own, and they have got the cash to do it,
    right?
        Ms. Bennett. I won't speak to what the Chinese can and
    can't do. However, I do know that in terms of a longstanding
    practice, that this is--that foreign entities have received
    grants----
        Mr. Burgess. How is that----
        Ms. Bennett. And as well as to help deliver and build
    capacity in order to have a more level playing field for U.S.
    products and services.
        Mr. Burgess. Still, though, it is a stretch to think that
    is helping our constituents directly. The EPA providing
    $150,000 to the International Criminal Police Organization in
    Lyon, France, to promote and strengthen international
    environment enforcement through capacity building. We're
    supposed to be helping them enforce their cap-and-trade law? Is
    that what we are to be doing?
        Ms. Bennett. I am not familiar with the individual grants.
        Mr. Burgess. Well, how about the taxpayer benefit from the
    EPA's hundreds of thousands of dollars of funding Breathe Easy
    Jakarta, a partnership with the government of Jakarta to
    improve their quality management?
        Ms. Bennett. Again, I am not familiar with individual
    grants.
        Mr. Burgess. Sure and we will----
        Ms. Bennett [continuing]. A longstanding practice of many
    administrations.
        Mr. Burgess. Sure. And we will provide you the direct
    things that we are concerned about. We would like responses to
    these because, again, these are questions that we get.
        [The information appears at the conclusion of the hearing.]
        You know, I go home and have a town hall and 300 or 400
    people show up and someone sees one of these stories. These are
    the questions they ask. How can we justify spending--wouldn't
    we be better to make that investment in our air quality here at
    home as opposed to Jakarta, Indonesia?
        Ms. Bennett. It has been a longstanding practice of all--
    many administrations to do this kind of funding. I understand--
    --
        Mr. Burgess. Well you are the CFO and your recommendation
    to your administrator may be that it is time to concentrate--
    what moneys we can spend, it is time to concentrate them here
    at home and not Breathe Easy Jakarta.
        Thank you, Mr. Chairman. I will yield back the balance of
    my time.
        Mr. Stearns. The gentleman yields back.
        And I think we have completed our second round.
        Before I close, I just want to make a comment.
        Ms. Bennett, my understanding is that you have testified
    that with respect to the excess lab issue, the EPA is
    requesting more money in the President's budget to study issues
    concerning the EPA's labs; is that correct?
        Ms. Bennett. In terms of how we should approach the labs in
    terms of the usage and how we best structure them.
        Mr. Stearns. This is even though GAO has already performed
    an audit and issued recommendations to EPA already, isn't that
    correct?
        Ms. Bennett. That is correct.
        Mr. Stearns. So you are saying that the EPA needs to
    spend--needs to ask for more money in order to achieve savings
    from the GAO audit in which they specifically outline ways that
    you could save money, so you are saying this morning, you need
    more money to save money?
        Ms. Bennett. What we are trying to do is make sure that we
    keep in mind science that is being done in each one of those
    labs and that anywhere we might be able to consolidate, if that
    is an appropriate avenue, that we do so with the science in
    mind.
        Mr. Stearns. So, the GAO, though, has already issued
    recommendations, and they have been specific on how to save
    money, and they have done an audit. I would think lots of those
    you could implement, couldn't you implement any of them?
        Ms. Bennett. There are some recommendations that we can
    implement.
        Mr. Stearns. You would need more money under the
    President's budget to do that, that is what you said.
        Ms. Bennett. The money that we are asking for in the 2012
    budget would be a study that is done by the--and reviewed by
    the National Academy of Science to make sure that the science
    that is done in those labs continues to be of the caliber and
    it is not impacted at all.
        Mr. Stearns. It seems to me that you could just run with
    the GAO's recommendation and do a lot of them and save money
    today, but you are not willing to commit to that. You just want
    to say you need more money to save money. So I am a little
    puzzled.
        I ask unanimous consent that the committee's September 15,
    2011, letter to EPA Administrator Jackson on line-by-line
    budget review as well as EPA's October 11, 2011, letter
    response be introduced into the record.
        Without objection, the documents will be so entered.
        [The information follows:]

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        Mr. Stearns. And also to put into the record the
    Environmental Protection Agency's consolidated balance sheet
    that we have talked about all morning.
        By unanimous consent, so ordered.
        [The information follows:]

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        Mr. Stearns. I want to thank the witnesses for coming, for
    staying, and their testimony and for the members staying for
    the second round.
        The committee rules provide that members have 10 days to
    submit additional questions for the record to the witnesses.
        And with that, the subcommittee is adjourned.
        [Whereupon, at 12:40 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]

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