[Senate Hearing 112-]
[From the U.S. Government Publishing Office]



 
     DEPARTMENT OF THE INTERIOR, ENVIRONMENT, AND RELATED AGENCIES 
                  APPROPRIATIONS FOR FISCAL YEAR 2012

                              ----------                              


                       WEDNESDAY, MARCH 16, 2011

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:02 p.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Jack Reed (chairman) presiding.
    Present: Senators Reed, Nelson, Murkowski, Cochran, 
Collins, and Blunt.

                    ENVIRONMENTAL PROTECTION AGENCY

STATEMENT OF HON. LISA P. JACKSON, ADMINISTRATOR
ACCOMPANIED BY BARBARA J. BENNETT, CHIEF FINANCIAL OFFICER

                 OPENING STATEMENT OF SENATOR JACK REED

    Senator Reed. Let me call the hearing to order and welcome 
the Administrator.
    And, on behalf of my colleagues, I would like to welcome 
you to the hearing on this year's 2012 budget request for the 
Environmental Protection Agency (EPA).
    I am very pleased to welcome Administrator Lisa P. Jackson 
to testify before the subcommittee. Administrator Jackson, it's 
my understanding that this hearing will be your seventh 
appearance before a congressional committee during this 
Congress. I know all of your colleagues in the Cabinet are 
jealous, but tell them to try to contain themselves. We are 
extremely glad that you and Chief Financial Officer Barbara 
Bennett are here this afternoon to discuss these very important 
issues.
    Like many in the room, I'm old enough to remember, in 1969, 
before President Nixon led the enactment of the EPA, when the 
Cuyahoga River, in Ohio, was on fire. Sometimes we forget the 
progress that we've made, and it's a result of legislation that 
has traditionally been supported on a bipartisan basis. And 
that's helped us improve the environment, which improves the 
health and, I think, also the productivity of the United 
States.
    We do face significant challenges to continue to improve 
air and water quality. And they're particularly difficult at a 
time when our economy is under huge pressure and it is 
struggling, and we recognize that. We are under budget 
constraints. We also realize that we have to balance all of 
these factors: the need for environmental protection, to 
protect public health, and the need to wisely use public 
resources.
    I want to make sure that the progress that we've made in 
the last several years--indeed, several decades--is not lost, 
and do so in a way that is wise and prudent for Americans, and 
particularly in their capacity as taxpayers.
    If you turn to the budget, the administration has requested 
a total of $8.973 billion for the EPA this fiscal year 2012. 
That's a decrease of $1.318 billion below fiscal year 2010 
enacted level, or a 13 percent cut. We all recognize that 2010 
represented a significant increase in funding. But, I think, 
looking between the lines, a great deal of that funding went to 
sewer and drinking water infrastructure and clean-up 
operations, which had directly contributed to jobs and to 
stimulus, you know, around the country, at a time we needed it.
    With the amount that has been requested, the budget 
proposes targeted investment to increase State air and water 
pollution control grants, and increased funding to climate 
change and chemical safety programs.
    And I'm particularly pleased to see the request includes $5 
million for work on new fuel-efficiency standards for passenger 
cars that will save consumers money at the pump and further 
reduce carbon pollution. At a time when we see gas prices, not 
inching up, but galloping up, the long-term need to increase 
the efficiency of our fleets should be obvious.
    But, I'm somewhat disappointed that there's a cut of about 
$1.1 billion from water infrastructure programs. These are the 
very programs that were funded so robustly in 2010, and 
represented, for communities, not only a chance to improve the 
quality of life, but also to put people to work. For example, 
the there's a $550 million cut for the Clean Water State 
Revolving Fund (CWSRF), a $397 million cut of the Drinking 
Water State Revolving Fund (DWSRF); there is a 26 percent cut 
for sewer projects and a 29 percent cut for DWSRF projects. And 
these may seem somewhat mundane, but literally it's the 
plumbing of our national economy and it's the way to keep 
people working and keep improving the quality of the 
environment.
    It's been estimated that we'll lose about 300 fewer 
infrastructure projects because of the funding requests. And it 
will reduce jobs in the construction industry, which is already 
reeling from a 22 percent unemployment rate; these are the 
tradesmen and women who really need to get off the bench and 
get back to work.
    In my home State of Rhode Island, we've lost 6,000 
construction jobs since 2008. And, at the same time, we have 
more than $1.2 billion of CWSRF projects that have been 
identified. So, we are far from, sort of, responding to the 
identified needs, in terms of sewage and water projects 
throughout the State. The magnitude of cuts is even greater 
over time, because many such States stretch their CWSRF and 
DWSRF programs by leveraging through their own resource and 
other resources. So, this also has a multiplier effect.
    I also note that the National Estuary Program has been cut 
by about 17 percent, for a total of a cut, about $27 million. 
And there has been a complete elimination of Diesel Emissions 
Reduction Act program. These have, again, particular concerns 
to my home State. We, in Rhode Island, are participating in the 
Estuary Program, through our Narragansett Bay.
    I know we are going to have a very good discussion today. I 
know the issues here are very difficult conceptually and they 
have consequences, both in terms of environmental quality, but 
also in terms of the overall economy. We do have to provide 
balance. And I hope, at the result of our discussions and 
deliberations, we will be able to provide you with the 
resources necessary to keep your mandate to protect the 
environment and also to help stimulate our economy.
    With that, I'd like to recognize the ranking member, 
Senator Murkowski.

                  STATEMENT OF SENATOR LISA MURKOWSKI

    Senator Murkowski. Thank you, Mr. Chairman.
    Welcome, Administrator Jackson. Appreciate you being here 
today, and I note the Chairman's comments about your many 
appearances before subcommittees already yet this year. But, 
good to have you here today.
    I recognize that today's hearing is about our fiscal year 
2012 budget request, but most of the questions that I will 
direct to you this afternoon involve policy. I think you 
recognize that many of the agencies that the EPA has taken have 
immediate consequences to the State of Alaska.
    When I travel around the State--and I do, a lot--I think, 
in this past year, I have just been about everywhere and one 
agency that gets more public scorn than any out there is that 
of the EPA. And I can tell you that the EPA is in a league of 
its own. We've got all of the other Federal agencies involved 
in all aspects of our life, but it really is the EPA that takes 
the brunt. And it is because people literally feel concerned 
that their economic livelihoods are being put at risk. I've had 
so many people approach me and say, ``Lisa, you've got to reign 
in,'' Lisa, this Lisa ``you've got to rein in the EPA. They're 
out of control. They're going to put me out of business.''
    And it's somewhat amazing to me that the EPA has decided to 
make Alaska, of all places, its problem child. And I hate to 
put it in those terms, but I want you to understand what it is 
that I hear from the people in my State. We've got cleaner air 
and cleaner water than just about anywhere else in the world. 
We've been mining, drilling oil--for oil and gas for decades. 
And yet, we have, seemingly, been so singled out by the EPA.
    As I look at the fiscal year 2011 CR that we voted on the 
H.R. 1 that we voted on last week, it's clear to me that 
Alaskans are not alone in their view about the EPA. Of the 21 
amendments that were related to energy and the environment that 
were voted on by the House, 9 of them placed funding 
limitations on various EPA policies. I know that you had a 
chance to look at those.
    One of those amendments that was passed was offered by my 
colleague from Alaska, and it concerned the air permits that 
Shell Oil has applied for in the Beaufort. Shell has spent 5 
years and $50 million in pursuing these air permits from the 
EPA for no more than two drill ships to operate in the Arctic 
Outer Continental Shelf (OCS). Just last month, the EPA's 
Environmental Appeals Board rejected those permits, remanded 
them back to the EPA's Region 10 for more analysis. Shell has 
now dropped its plans to drill in the Beaufort this summer. It 
costs the company even more money, certainly more jobs and 
economic opportunity within the region. And the delay truly 
is--it's 100 percent attributable to the EPA.
    I cannot understand I just cannot understand how it can 
take so long for an agency to approve an air permit for a 
drilling rig that will operate 25 to 75 miles offshore less 
than one quarter of the year. The kinds of permits that are 
routinely issued in the Gulf of Mexico take 6 weeks to issue. 
And these are in air sheds where there are many more drilling 
rigs operating year round, you've got more communities in close 
proximity.
    In Shell's case, there was supposed to be one drill ship, 
and the nearest area that would possibly face any impacts on 
air quality is the North Slope Borough. The borough is 88,000 
square miles. It's bigger than 39 States, has roughly 7,000 
people spread out across this area. The activities, right in 
their backyard, over in Prudhoe Bay and other fields, haven't 
had to go through this level of delay.
    So, again, we're trying to understand. You're issuing an 
air-quality permit, it takes 6 weeks in one region of the 
country, and after 5 years we are still waiting.
    Another issue that I'll have an opportunity to ask you, in 
questioning, that is equally frustrating, and this relates to a 
permit that we're trying to get in the National Petroleum 
Reserve (NPR-A). ConocoPhillips has submitted an application to 
the Corps of Engineers (COE) for a project known as CD-5 that 
would bring the first oil to market from the NPR-A. But, in 
order to do this, they've got to get a bridge over the Colville 
River. Contrary to the statutes passed by the Congress, 
establishing the reserve for the expeditious exploration and 
development of oil and gas resources, the EPA used an arbitrary 
designation that is neither in statute nor in regulation this 
is the Aquatic Resource of National Interest (ARNI) to threaten 
or override the COE decision and prohibit construction of the 
bridge.
    Now, I sent you a letter about the designation of the ARNI, 
what standards are used in applying them. I just did receive a 
response. And, while I thank you for the response, it does not 
alleviate the concerns that I have. I'm very concerned that, by 
using this designation, the EPA has, essentially, the ability 
to pre-emptively signal a veto for projects under section 
404(c) of the Clean Water Act (CWA). And what's troubling to 
many in Alaska is that this designation appears to have been 
used only 16 times in an 18 year period, up until last year, 
but was then used twice in Alaska in 16 months. So, people are 
coming to me saying, ``What's going on? What is happening 
within the agency? And is this something that we should be 
concerned about?'' And I think the answer to that is yes.
    One of the other issues that I'd like to raise is the 
process that the EPA is using to conduct the watershed 
assessment there in Bristol Bay.
    I have to admit, Administrator, you probably have one of 
the tougher jobs in this town right now. I think your agency 
has become a lightning rod. Many people would like to see it 
abolished, or your budget completely eliminated. And I want you 
to know, ahead of the questions here, I do not believe that 
that is the solution that many of us have with the issues in 
the EPA. I do not want to abolish the EPA. I simply want the 
EPA to do its job.
    And implicit in the EPA doing its job is fair treatment to 
those that you regulate. It should not take 6 years and $50 
million to approve air permits for leases that companies have 
paid billions of dollars for, at the invitation of the Federal 
Government. The EPA shouldn't be using arbitrary designations, 
like ARNIs, to override statutes that are passed by the 
Congress, in order to block critical projects that support our 
Nation's energy security. And the EPA shouldn't be using 
processes that can effectively pre-empt projects before 
applications have even been submitted.
    Again, I appreciate that you have a very difficult job and 
the balancing act is tough. Part of our job, here on the 
subcommittee, is to ensure that you have the resources 
necessary to do just that. And again, we want to work with you 
to make sure that you have that, but, again, the expectation is 
that you work to do that job.
    Senator Murkowski. I thank you, Mr. Chairman.
    Senator Reed. Thank you, Senator Murkowski.
    Before I recognize the director, first, all statements will 
be made part of the record, but if any of my colleagues want to 
make brief opening remarks, I'd definitely entertain such 
remarks.
    Senator Cochran. Mr. Chairman.
    Senator Reed. I'll----
    Senator Cochran. Oh. Go ahead.
    Senator Reed. Let me just go, Senator Leahy, then Senator 
Cochran.
    Senator Leahy.

                 STATEMENT OF SENATOR PATRICK J. LEAHY

    Senator Leahy. Mr. Chairman, I'll be brief. Unfortunately, 
like everybody else, I've got another issue to attend to.
    I do welcome the Administrator here. I do agree that it's 
one of the most difficult jobs. I once said that I didn't know 
whether to offer her a congratulations or condolences on the 
job.
    But, I'm delighted you're there. You've worked a lot with 
us in Vermont. You've--and, since the Lake Champlain 
Designation Act, 20 years ago--the EPA's been a strong partner 
in the cleanup of Lake Champlain. I think both Vermont and New 
York have valued that. We've worked with Republican and 
Democratic administrations, Republican and Democratic 
Governors, alike, to identify and test the quality of Lake 
Champlain. We want to preserve it; we think it's a natural 
wonder, but it's also an integral part of our economy. So, I 
thank you for your help in facilitating the movement on the 
ECHO grant in Vermont. I understand this. These funds may be 
available the first part of April, which will be very helpful 
in that program.
    The EPA's interest in Lake Champlain is stronger than ever, 
especially with your move, earlier this year, to require that a 
new Phosphorous Total Maximum Daily Load Plan be written by the 
EPA. And I know that in Vermont the Governor's office will be 
working closely with you on that.
    But, we welcome the EPA's participation, but we also want 
to see a commitment. While the EPA budget for other watersheds 
has grown significantly over the past few years, the budget 
request for Lake Champlain remains relatively flat. In fact, 
the fiscal year 2012 budget request recommends a reduction from 
the level in fiscal year 2010.
    So, I hope that Vermont and New York can work together on 
that. I know you were disappointed when the gulf oil spill 
required you to postpone a planned visit to Vermont, but I want 
you to know we'll all be welcoming you when you get there.
    And so, that's my whole statement, which may have actually 
sounded somewhat parochial, Mr. Chairman, but it is an area of 
some concern. I have talked with Ms. Jackson before about these 
subjects.
    Senator Reed. Thanks.
    Senator Cochran.

                   STATEMENT OF SENATOR THAD COCHRAN

    Senator Cochran. Mr. Chairman, I'm pleased to join you in 
welcoming the administrator of the EPA to the subcommittee to 
review the EPA's budget request for fiscal year 2012.
    The mission of the EPA is to protect human health and 
preserve the environment, which is vital to the sustainability 
and quality of life. Our subcommittee recommends the levels of 
funding for all Government agencies to fulfill their missions, 
as authorized by law.

                           PREPARED STATEMENT

    We appreciate your cooperation with our subcommittee, and 
we look forward to hearing your testimony.
    [The statement follows:]
               Prepared Statement of Senator Thad Cochran
    Mr. Chairman, I am pleased to join you in welcoming the 
Administrator of the Environmental Protection Agency (EPA), to the 
subcommittee to review the EPA's budget request for fiscal year 2012.
    The mission of the EPA is to protect human health and preserve the 
environment is vital to the sustainability and quality of life. Our 
committee recommends the levels of funding for all Government agencies 
to fulfill their missions as authorized by law. We appreciate your 
cooperation with our subcommittee, and I look forward to hearing your 
testimony.

    Senator Reed. Thank you.
    Senator Blunt.

                     STATEMENT OF SENATOR ROY BLUNT

    Senator Blunt. Thank you, Mr. Chairman. I'm going to have 
to leave in a minute, and I hope to get back for some of the 
questions; but, just in case I don't, I wanted to say a couple 
of things, and end with a story that I heard last year on the 
impact of energy prices.
    I am concerned, as the discussion on the Senate floor has 
indicated this week that many are, that the EPA not use its 
regulating authority to do what I believe legislatively would 
never happen now with cap and trade. New Source Review would be 
one of those authorities.
    In our State, the Ameren Corporation upgraded a plant 
almost a decade ago so it could burn some low-sulfur coal. And 
now the EPA's there, attempting to achieve, in my view, what 
the administration couldn't achieve legislatively. And that's a 
real problem. Our State's a State where, I think, 82 percent of 
the electricity comes from coal. All the utility providers went 
together, after the House passed bill last year, and paid for a 
study, that no one has found fault with, of the impact of that 
bill in our State. And it was that the utility bill would 
almost double in the first decade.
    And as I was talking to people all over Missouri last 
year--I think it was sometime in September--a guy walked up to 
me, who was an hourly employee somewhere he didn't I know he 
didn't have a Ph.D. in economics and here's what he said. He 
said, ``If my utility bill doubles, that's a bad thing. If my 
retired mother's utility bill doubles, that's a worse thing. 
But, if the utility bill at work doubles and my job goes away, 
the other two bills don't matter much anyway, because I can't 
pay mine and I can't help my mother pay hers.'' And I do think 
that's the impact of policies that go too far too quickly.
    I think the country has reached a conclusion on this, and I 
hope the administration and the EPA follow along with that. You 
know, my mom and dad were dairy farmers. The whole discussion 
of spilt milk is incredible to me, as is the discussion of 
farming without dust, or fugitive dust. You know, when I go 
later to talk to the Missouri Farm Bureau today, the concept 
that you have to control where the dust goes when you're 
harvesting or getting a field ready to plant is astounding to 
them, and it is to me.
    And I have a statement for the record, Mr. Chairman. Thank 
you for letting me make those remarks.
    Senator Reed. Thank you very much, Senator Blunt.
    Senator Nelson, do you have a--comments? Or----
    Senator Nelson. No, Mr. Chairman. We'll wait for the 
questions. Thank you.
    Senator Reed. Thank you. Senator Collins.

                   STATEMENT OF SENATOR SUSAN COLLINS

    Senator Collins. Thank you, Mr. Chairman. I'll put my full 
statement in the record and just make a couple of brief 
comments.
    The EPA performs absolutely vital functions in helping to 
protect the public health by ensuring that the air we breathe 
is clean and the water we drink is safe. We need, however, to 
make sure that, as the EPA issues new regulations, that it does 
not create so many roadblocks to economic growth that it blocks 
out private investment, which is the key to a prosperous 
future.
    According to the White House's own assessment, as posted on 
its online ``Dashboard'', the EPA is responsible for roughly 1 
out of every 5 pending regulatory actions currently under 
review. That is an astonishing number of rules that are under 
consideration by any one agency, especially at a time when the 
President has said that he wants to pull back unnecessary, 
inefficient, or outmoded regulations that make our economy less 
competitive.
    Speaking of new regulations, in my questions today I am 
going to talk about the very negative potential impact of the 
EPA's new Boiler MACT rules on the forest products industry in 
my State and throughout the Nation. I know that Maine's forest 
product businesses and its employees are extremely worried 
about the effects of this onerous regulation. I do recognize, 
in response to a letter that I spearheaded, that 40 Senators 
signed, the EPA's taking another look at those regulations. And 
I do look forward to discussing that issue.
    But, I would just note to my colleagues that we saw a great 
lack of flexibility within the EPA on display last spring, when 
the EPA did not provide enough time nor enough training 
opportunities to allow small businesses to comply with lead 
paint abatement rules. If I had not been successful in my 
efforts to require the EPA to provide more time for compliance, 
small contractors would have faced steep fines, up to $37,500 
per violation, per day, that could have forced many of them out 
of business, through no fault of their own, since there simply 
were not enough the EPA trainers to ensure compliance.
    So, those are some of the issues that concern me, Mr. 
Chairman. I also associate myself with your remarks on the 
State Revolving Fund budget cuts. Those programs have worked 
extremely well in my State.
    Thank you.
    Senator Reed. Thank you very much, Senator Collins.
    Madam Administrator, your statement will be made part of 
the record. And any comments you'd like to make now, please go 
ahead.

                  SUMMARY STATEMENT OF LISA P. JACKSON

    Ms. Jackson. Thank you so much, Chairman Reed. Thank you, 
Ranking Member Murkowski and members of the subcommittee. 
Thanks for inviting me to testify about President Obama's 
budget request for the EPA.
    The Congress enacted laws, such as the Clean Air Act (CAA) 
and the CWA, on a broadly bipartisan basis. It did so to 
protect Americans from pollution that otherwise would make 
their lives shorter, less healthy, and less prosperous. It did 
so to make the air and drinking water in America's communities 
clean enough to attract new employers. It did so to enable 
America's local governments to revitalize abandoned and 
polluted industrial sites. It did so to safeguard the pastime 
of America's 40 million anglers. It did so to protect the 
farms, whose irrigation makes up a one-third of America's 
surface freshwater withdrawals. And it did so to preserve the 
livelihoods of fishermen in America's great waters. The 
Congress directed the EPA to implement and enforce those laws. 
And each year, the Congress appropriates the money that makes 
the EPA's work possible.
    As the Administrator of the EPA, I am accountable for 
squeezing every last drop of public health protection out of 
every dollar we're given. So, I support the tough cuts in the 
President's proposed budget. But I am equally accountable for 
pointing out when cuts become detrimental to public health. 
Without adequate funding, the EPA would be unable to implement 
or enforce the laws that protect Americans' health, 
livelihoods, and pastimes. Big polluters would flout the laws 
against dumping contaminants into the air, into rivers, and 
onto the ground. Toxic plumes, already underground, would reach 
drinking water supplies, because ongoing work to contain them 
would stop. There would be no EPA grant money to fix or replace 
broken water treatment systems. And the standards the EPA has 
set to establish for harmful air pollution--I will mention one 
of those in just a minute--would remain missing from a 
population of sources that is not static, but growing.
    So, if the Congress slashes the EPA's funding, 
concentrations of harmful pollution would increase from current 
levels in the places Americans live, work, go to school, fish, 
hike, and hunt. The result would be more asthma attacks, more 
missed school and work days, more heart attacks, more cancer 
cases, more premature deaths, and more polluted waters.
    Needless to say, then, I fervently request and deeply 
appreciate bipartisan support for funding the essential work 
that keeps Americans, children, and adults safe from 
uncontrolled amounts of harmful pollution being dumped into the 
water they drink and the air they breathe.
    Decreasing Federal spending is no longer just a prudent 
choice, it is now an unavoidable necessity. Accordingly, 
President Obama has proposed to cut the EPA's annual budget 
nearly 13 percent. That cut goes beyond eliminating 
redundancies. We have made difficult, even painful, choices. We 
have done so, however, in a careful way that preserves the 
EPA's ability to carry out its core responsibilities to protect 
the health and well being of America's children, adults, and 
communities.
    You've been reviewing the budget request for a month now, 
so I will save the details for the question period. Before 
turning to your questions, I will describe an action the EPA 
took earlier today to reduce toxic air pollution that poisons 
children's brains and causes cancer.
    In the 1990 amendments to the CAA, the Congress directed 
the EPA to establish standards for limiting toxic air pollution 
from coal- and oil-fired powerplants. More than 20 years later, 
the EPA had still had not established those basic safeguards, 
even though coal-fired powerplants are responsible for 99 
percent of the toxic mercury dumped into America's air every 
year. Mercury is a neurotoxin, a brain poison. It harms the 
brain and the developing brains of children, leaving them with 
learning disabilities.
    Earlier today, I signed long-overdue proposed standards to 
require coal- and oil-fueled powerplants to spend the next 
several years installing the technologies that are already 
widely available for sharply reducing the amounts mercury, 
arsenic, chromium, and other toxic pollutants that they dump 
into the air. Many of America's powerplants already control 
toxic air pollution, despite the lack of Federal standards. 
But, nearly one-half of the country's coal-fired plants 
continue to do nothing to limit the amounts of these poisons 
that they spew into the air.

                           PREPARED STATEMENT

    The EPA's new action will ensure that companies all across 
the country follow the same rules. The equipment for capturing 
neurotoxic mercury and cancer causing arsenic and acid gases 
also traps fine-grain soot, which kills people by lodging deep 
in their lungs. So, these new standards will, each year, 
prevent up to 17,000 premature deaths in America, not to 
mention 120,000 cases of aggravated asthma. The health benefits 
will swamp the compliance costs by a factor of about 10 to 1.
    Thank you, Chairman Reed. I look forward to yours and the 
panel's questions.
    [The statement follows:]

                 Prepared Statement of Lisa P. Jackson

    Chairman Reed, Ranking Member Murkowski, and members of the 
subcommittee, thank you for the opportunity to appear before you to 
discuss the Environmental Protection Agency's (EPA) proposed budget. In 
the State of the Union Address--as President Obama laid out a plan to 
win the future--he made clear that we ``will not hesitate to create or 
enforce common-sense safeguards to protect the American people,'' and 
explained that these safeguards are ``why our food is safe to eat, our 
water is safe to drink, and our air is safe to breathe.''
    These are the services the EPA provides. The EPA's activities 
prevent thousands of illnesses such as asthma, cancer, and other 
diseases. They help keep students and workers healthy so they can be 
more productive. And, they save lives. Preliminary estimates show that 
last year, the Clean Air Act (CAA) alone is estimated to have saved 
160,000 lives and prevented more than 100,000 hospital visits.
    President Obama also understands, however, that as millions of 
families are cutting back and making sacrifices, they expect the same 
level of good fiscal sense out of their Government.
    This budget reflects that good fiscal sense, and makes many tough 
choices.
    Fiscal year 2010's budget of $10.3 billion was the EPA's highest 
funding level since its creation. This fiscal year 2012 budget request, 
while a deep cut resulting in a total budget of $8.973 billion, will 
allow the EPA to carry out its core mission and fund the most critical 
efforts to protect the health of American families.
    The choices in this budget reflect the EPA's commitment to core 
regulatory work and preserving the hard-won progress made over the last 
40 years in protecting and restoring the quality of our air, water, and 
land; ensuring the safety of our chemicals; and providing strong 
enforcement of environmental laws and regulations.
    At the same time, we have heeded the President's call for deficit 
reduction and made some painful choices to reduce funding for important 
programs. As it does every year, the EPA has worked to find 
efficiencies within our programs and in some cases made reductions 
trusting that further efficiencies can be found. The $8.973 billion 
proposed for the EPA in the fiscal year 2012 President's budget will 
allow the EPA to maintain its core programs while investing in areas of 
urgent need and will support key priorities during this time of fiscal 
challenges. This budget represents a nearly 13 percent reduction over 
the fiscal year 2010 budget and reflects our priorities: supporting 
action on climate change and improving air quality; protecting 
America's waters; building strong State and tribal partnerships; 
strengthening enforcement and compliance; enhancing chemical safety; 
supporting healthy communities; and maintaining a strong science 
foundation. Because of the constrained fiscal environment, the budget 
decreases the State Revolving Funds (SRFs) by nearly $950 million while 
supporting a long-term goal of providing about 5 percent of total water 
infrastructure spending and spurring more efficient system-wide 
planning. The budget also reduces the Great Lakes Restoration 
Initiative by $125 million, eliminates about $160 million in targeted 
water infrastructure earmarks, and eliminates $60 million for clean 
diesel grants. Our priorities are aligned with the Government-wide 
effort to identify near-term, high-priority performance goals. For the 
EPA, our goals include reducing greenhouse gas (GHG) emissions, 
improving water quality, and delivering improved environmental health 
and protection to our communities. The EPA will work toward meeting 
these goals over the next 18 to 24 months. Chairman and members of the 
subcommittee, let me touch on some of the highlights of this budget, 
both the painful choices and the targeted investments that will protect 
our health and the environment.

Supporting Action on Climate Change and Improving Air Quality
    We are committed to meeting the EPA's obligations under the CAA, 
the landmark law that all American children and adults rely on to 
protect them from harmful air pollution. We will continue to take 
meaningful, common sense steps to address climate change and improve 
air quality. Making the right choices now will allow the EPA to improve 
health, drive technology innovation, and protect the environment; all 
without placing an undue burden on the Nation's economy. Indeed, the 
EPA's implementation of the CAA has saved millions of lives and avoided 
hospital visits; enhanced American productivity by preventing millions 
of lost workdays and growing the clean energy sector; and kept American 
children healthy and in school.
    Our budget requests $46 million for additional regulatory efforts 
aimed to reduce GHG emissions and address the Climate and Clean Energy 
Challenge. This includes $30 million in State grants and support for 
permitting, which will ensure that our State partners develop the 
technical capacity to address GHG emissions under the CAA. Also 
included is $6 million in additional funding for the development and 
implementation of new emission standards that will reduce GHG emissions 
from mobile sources such as passenger cars, light-duty trucks, and 
medium-duty passenger vehicles. These funds also will support the EPA's 
assessment and potential development, in response to legal obligations, 
of standards for other mobile sources. Also included is $7.5 million 
for the assessment and potential development of New Source Performance 
Standards for several categories of major stationary sources through 
means that are flexible and manageable for business. Finally, this 
amount includes an additional $2.5 million for priority measurement, 
reporting and verification activities related to implementing the GHG 
Reporting Rule, to ensure the collection of high-quality data. Our air 
toxics strategy prioritizes standards that provide the greatest 
opportunity for cost-effective emissions reductions. This budget 
requests an additional $6.4 million to conduct integrated pilots in 
several communities, including disadvantaged communities, to 
systemically evaluate and reduce risks from toxic air pollutants 
through regulatory, enforcement, and voluntary efforts. An additional 
$3.7 million will improve air toxic monitoring capabilities and 
dissemination of information between and among the EPA offices, the 
State, local and tribal governments, and the public. We anticipate a 
more than four-fold increase in the number of vehicle and engine 
certificates the EPA issues. In addition, as a result of diverse and 
sophisticated technologies, we anticipate more challenging oversight 
requirements for both the vehicle/engine compliance program and fuels. 
We will upgrade vehicle, engine, and fuel-testing capabilities through 
a $6.2 million investment in the National Vehicle and Fuel Emissions 
Laboratory.

Protecting America's Waters
    By leveraging partnerships and traditional and innovative 
strategies, we will continue to sustain and improve water 
infrastructure and clean-up America's great waterbodies. The EPA, the 
States, and community water systems will build on past successes while 
working toward the fiscal year 2012 goal of assuring that 91 percent of 
the population served by community water systems receives drinking 
water that meets all applicable health-based standards. The Clean Water 
State Revolving Fund (CWSRF) and Drinking Water State Revolving Fund 
(DWSRF) provide grants to States, which use the funds to make 
affordable loans to local communities for public drinking water and 
wastewater infrastructure projects. The President's budget requests 
$1.55 billion for the CWSRF and $990 million for the DWSRF. This 
request level reduces funding for SRFs by $947 million from fiscal year 
2010 levels. As part of the administration's long-term strategy, the 
EPA is implementing a Sustainable Water Infrastructure Policy that 
focuses on working with States and communities to enhance technical, 
managerial, and financial capacity. Important to the technical capacity 
will be enhancing alternatives analysis to expand ``green 
infrastructure'' options and their multiple benefits. Future year 
budgets for the SRFs gradually adjust, taking into account repayments, 
through 2016 with the goal of providing, on average, about 5 percent of 
water infrastructure spending annually. Federal dollars provided 
through the SRFs will serve as a catalyst for efficient system-wide 
planning and ongoing management of sustainable water infrastructure. We 
will also leverage our partnership with States and tribes through an 
additional $21 million in Water Pollution Control (section 106) grants 
to enhance water quality and to provide additional resources to address 
Total Maximum Daily Load, nutrient, and wet weather issues. An 
additional $4 million is requested for Public Water Systems Supervision 
grants to support management of State and drinking water system data, 
improve data quality, and allow the public access to compliance 
monitoring data not previously available. This will improve 
transparency and efficiency and reduce the need for State resources to 
maintain individual compliance databases.
    This budget supports the EPA's continued efforts to clean up 
America's great waterbodies. It includes $67.4 million for the 
Chesapeake Bay program, a $17.4 million increase, which will allow the 
EPA to continue to implement the President's Executive order on 
Chesapeake Bay protection and restoration. The increased funding will 
support Chesapeake Bay watershed States as they implement their plans 
to reduce nutrient and sediment pollution in an unprecedented effort to 
restore this economically important ecosystem. This budget has $350 
million included for programs and projects strategically chosen to 
target the most significant environmental problems in the Great Lakes 
ecosystem, a $125 million decrease from fiscal year 2010, the first 
year of the initiative. Led by the EPA, and engaging the capabilities 
of a number of Federal agencies, the initiative will implement the most 
important projects for Great Lakes Restoration and achieve visible 
results. The administration is committed to restoring and protecting 
the gulf coast ecosystem following decades of environmental harm, 
including the BP Deepwater Horizon oil spill. As chair of the Gulf 
Coast Ecosystem Restoration Task Force, established by Executive Order 
13554, I will work with the Federal and State Task Force members to 
lead environmental recovery efforts in the region. The EPA is also 
working to support the Federal and State trustees on the Deepwater 
Horizon Natural Resource Damage Assessment and Restoration Trustee 
Council as they develop a restoration plan to restore the region's 
natural resources to pre-spill conditions. As a complement to these 
efforts, the EPA's request of $6.6 million for the Mississippi River 
basin program will address excessive nutrient loadings that contribute 
to water-quality impairments in the basin and, ultimately, to hypoxic 
conditions in the Gulf of Mexico.

Building Strong State and Tribal Partnerships
    Strong partnerships and accountability are vital to the 
implementation of environmental programs, and we are committed to 
strengthening State and tribal capacity. This budget includes $1.2 
billion for State and tribal grants which is an overall increase of 
$84.9 million over fiscal year 2010 within this amount is a reduction 
to Nonpoint Source (section 319) Grants and Local Government Climate 
Change Grants. This request will provide critical support to State and 
local governments who are working diligently to implement new and 
expanded requirements under the CAA and Clean Water Act. These include 
implementation of updated National Ambient Air Quality Standards 
(NAAQS) and addressing complex water-quality issues such as nutrient 
pollution, which I discussed earlier.
    To help tribes strengthen environmental protection capacity and 
move forward with implementation of environmental programs, an $8.5 
million increase is included for Tribal General Assistance Program 
grants and $20 million is budgeted for the competitive Tribal Multi-
media Implementation grant program.

Strengthening Enforcement and Compliance
    Regulated entities, Federal agencies, and the public benefit from 
easy access to tools that help them understand environmental laws and 
find efficient, cost-effective means for putting them into practice. 
This budget includes a request of $27.5 million for the Regaining 
Ground in Compliance Initiative. Through this initiative, the EPA will 
begin to harness the tools of modern technology to address some of 
these areas and make EPA's Enforcement and Compliance Assurance program 
more efficient and effective. We also will increase the number of 
inspections at high-risk facilities regulated under the Spill 
Prevention, Control and Countermeasures and the Facility Response Plan 
regulations. By increasing the use of electronic reporting, monitoring 
tools, and market-based approaches, we will improve the effectiveness 
and efficiency of our limited resources, and ensure a level playing 
field for American businesses. By maximizing the use of advanced data 
and monitoring tools, we can focus our limited inspection and 
enforcement resources and focus our attention on identifying where the 
most significant vulnerabilities exist.

Enhancing Chemical Safety
    America's citizens deserve to know the products they use are safe. 
One of my highest priorities is making significant and long-overdue 
progress in assuring the safety of chemicals. We are taking immediate 
and lasting actions to eliminate or reduce identified chemical risks 
and develop proven alternatives. fiscal year 2012 represents a crucial 
stage in our approach for ensuring chemical safety. The program has 
attained its ``zero tolerance'' goal in preventing the introduction of 
unsafe new chemicals into commerce. However, many ``pre-TSCA'' 
chemicals already in commerce remain un-assessed. With the $16 million 
investment for the Enhancing Chemical Safety Initiative included in 
this budget, we will increase the pace of chemical hazard and risk 
assessments, strengthen chemical information management and 
transparency, and take action to address identified chemical risks 
including careful consideration of the impact of chemicals on 
children's health and on disadvantaged, low-income, and indigenous 
populations. The additional funding will help to close knowledge and 
risk management gaps for thousands of chemicals already in commerce 
through actions that will decrease potential impacts to human health 
and the environment. We also will continue promoting use of proven 
safer chemicals, chemical management practices, and technologies to 
enable the transition away from existing chemicals that present 
significant risks.

Supporting Healthy Communities
    We are committed to protecting, sustaining, or restoring the health 
of communities and ecosystems by bringing together a variety of 
programs, tools, approaches and resources directed to the local level. 
Partnerships with international, Federal, State, tribal, local 
governments, and nongovernmental organizations have long been a common 
thread across the EPA's programs. This diversity of perspectives and 
experiences brings a wider range of ideas and approaches, and creates 
opportunities for innovations. The budget includes a $20.4 million 
multidisciplinary initiative for Healthy Communities. It supports 
States and communities in promoting healthier school environments by 
increasing technical assistance on school siting, environmental health 
guidelines, and Integrated Pest Management in schools. It also provides 
resources to address air toxics within at-risk communities, and to 
enhance the important joint DOT/HUD/EPA outreach and related efforts 
with communities on sustainable development.
    We proudly support the America's Great Outdoors Initiative to 
develop a community-based 21st century conservation agenda that can 
also spur job creation in the tourism and recreation industries. 
Leveraging support across the Federal Government, the EPA will join the 
Department of the Interior, the Department of Agriculture, and the 
Council on Environmental Quality to lead the coordinated effort to 
protect and restore our outdoor legacy. The area-wide planning and 
community support focus of existing EPA programs and initiatives like 
urban waters and brownfields programs align well with the goals and 
objectives of this new initiative.

Maintaining a Strong Science Foundation
    To develop a deeper understanding of our environmental challenges 
and inform sustainable solutions, we are requesting a science and 
technology budget of $826 million, $22 million lower than our fiscal 
year 2010 enacted funding level, reflecting both efficiencies and 
difficult choices in order to ensure support for the highest-priority 
science needs. We will strengthen planning and delivery of science 
through an integrated research approach, which will help us more deeply 
examine our environmental and public health challenges. By looking at 
problems from a systems perspective, this new approach will create 
synergy and produce more timely and comprehensive results beyond those 
possible from approaches that are more narrowly targeted to single 
chemicals or problem areas. Within the request, we are including 
increases for research on endocrine disrupting chemicals, green 
infrastructure, air-quality monitoring, e-waste and e-design, green 
chemistry, and the potential effects of hydraulic fracturing on 
drinking water. To make progress on these research priorities and 
leverage the expertise of the academic research community, funding 
redirections will support additional Science to Achieve Results grants 
and fellowships. This budget also supports the study of computational 
toxicology, and other priority research efforts with a focus on 
advancing the design of sustainable solutions for reducing risks 
associated with environmentally hazardous substances. Two million 
dollars is also included to conduct a long-term review of the EPA's 
laboratory network. These increases are offset by redirections from 
other areas, such as human health and ecosystems, biofuels, homeland 
security, mercury, and ground water remediation. We look forward to 
working with the Congress to cut spending and cut the deficit. But to 
win the future, we cannot cut in a way that will undermine our ability 
to win the future and out-educate, out-innovate, and out-build our 
economic competitors. The budget that the President announced is a 
responsible plan that shows how we can live within our means and invest 
in the future. It makes tough choices to cut spending and cut the 
deficit. It includes a 5-year nonsecurity discretionary freeze, saving 
more than $400 billion over the decade and reducing nonsecurity 
discretionary spending to its lowest level as a share of the economy 
since President Eisenhower, and the budget reduces the deficit by more 
than $1 trillion, putting us on a path to fiscal sustainability. Thank 
you again for inviting me to testify today, and I look forward to 
answering your questions.

    Senator Reed. Well, thank you very much, Madam 
Administrator.
    And let me start off a first round of questions, with the 
anticipation that we'll do two, if your time allows.

                         GREENHOUSE (GHG) GASES

    One issue that has been addressed both explicitly and 
implicitly has been the whole regulation of GHG. The EPA and 
the States are required to start issuing GHG permits January 2 
of this year for modifications of the largest existing sources, 
with additional facilities scheduled to be phased in, this 
July. And there has been some discussion, obviously, about 
whether the EPA and the States would be ready to process the 
permits in time or they would, in fact, contribute to delay in 
construction parts, delay in modifications to these plants.
    Can you tell us where we stand? Are the States and the EPA 
ready to process GHG permits in all 50 States? And how many 
permits are under review? And how many have already been 
granted?
    Ms. Jackson. Yes, Chairman, together we are ready. In every 
jurisdiction in the United States there is a permitting 
authority that is ready and able to process permit 
applications, to issue legally valid permits, upon review of 
applications. In those places where the State government has 
been unable or unwilling to process permit applications for GHG 
emissions, the EPA is now in place, by law, as the permitting 
authority for that portion of their permits, for the GHG 
portion of their permits.
    We have approximately 100 permit applications in process 
for GHG emissions at this time. Twenty-six of those 100 have 
already completed their BACT analyses that are required as part 
of the permitting process. Two permit applications have been 
reviewed and already issued. One is in my home State of 
Louisiana. I'm not quite sure of the location of the other one. 
It may be California.
    Senator Reed. Thank you very much. Throughout our 
discussions, and implicit in everything we do, is this 
tradeoff, this balance between environment quality, public 
health, and economic development/economic productivity. And 
it's an ongoing debate. On one hand, when modifications are 
made and you permit and require changes in facilities, that 
usually implies hiring construction workers to go in--and 
contractor and engineers--and that creates jobs. But, there's 
also, on the other side, as we've all heard, the suggestion 
that this somehow impedes employment, impedes productivity.

                                  CAA

    We've seen different studies. There's one study reference I 
saw where, over the life of the CAA, the estimate of about 1.5 
percent positive GDP as a result of the contributions of the 
CAA. But, the question really is, is there evidence that these 
rulemakings have produced the kind of job losses that some 
people have cited? Or, in fact, have they contributed to 
positive job creation? Any comments you may have?
    Ms. Jackson. Every objective analysis of the history, 
looking back at the CAA, not projections of worst-case 
scenario, but what has actually happened on the ground, shows 
that the CAA has actually helped the economy. The CAA was 
passed in 1970; our economy has grown more than 200 percent. 
Our gross domestic product (GDP) is up, in that time. 
Pollution, in that same time period, is down more than 50 
percent. We were required to do a study recently--a peer-
reviewed study. From 1990, when the CAA amendments passed, 
through 2020, the monetary value is projected to exceed the 
cost of the Act by a factor of 30--three-zero--to 1. Public 
health benefits are expected to reach $2 trillion, with a 
``t''--$2 trillion in 2020, due to the 1990 amendments of the 
CAA.
    We know it's positive for our trade balance. There was an 
$11 billion surplus in 2008. We export more environmental 
technology and goods than we use in this country, so we 
actually are positive, with respect to the trade balance. It's 
a $300-billion-a-year revenue generator. And I think you might 
have mentioned the University of Massachusetts study, which 
talked about just two standards under the CAA having the 
potential to create as many as 1 million to 1.5 million jobs 
over the next 5 years.

                                 H.R. 1

    Senator Reed. Just a final question in my remaining time, 
and that is: The House has a series of proposals in H.R. 1, 
which have been mentioned. In your view, would they in any way 
inhibit, the ability of the EPA to protect the public health? 
And I'll leave it to you to respond, Madam Chairman.
    Ms. Jackson. There are two portions to H.R. 1. There are 
the budget cuts and then there are the series of riders, which 
we heard mentioned. And I believe that the budget cuts are 
draconian. They cut across the EPA and will, in my mind, result 
in more pollution in our air and in our water and on our land. 
And because pollution is so closely tied to public health, my 
belief is, when it comes to air pollution, we will see more 
asthma attacks, more heart attacks, more premature deaths. That 
is the work of the EPA. And when the EPA is not able to do its 
work, cuts like that, in my mind, cut into our ability to do 
our job.
    The riders, themselves, bring up a range of issues where 
the EPA's hands are, essentially, tied to address issues of 
pollution that aren't generally in controversy. People see the 
pollution, there is concern, justifiable concern, of the cost 
of addressing pollution, certainty for businesses, so that they 
know, if they need to get a permit, they can get it, and that 
the rules are what the rules are, and that they're the same 
rules across the board. But, my belief is that the cuts, as 
well as many of the riders, are going to result in holes in the 
environmental safety net.
    Senator Reed. Thank you very much.
    Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman.

                              OSC PERMITS

    Administrator Jackson, I want to followup with the 
statement that I made initially, as it relates to the OCS 
permits and the length of time that we're talking about. I 
mentioned that Shell has been in process now for over 5 years. 
I made reference to the fact that, in the Gulf of Mexico, an 
air-quality permit can be issued within about 43 days. So, 
you're looking at a situation where you've got about 6 weeks on 
one end and almost close to 6 years on the other. I guess just 
a basic question is: Do you think that this is reasonable?
    Ms. Jackson. I believe that what the EPA's job is, is to 
give prompt answers when permit applications come in. The EPA 
has certainly issued permits in that area. And, as you know, 
they've been subject to litigation and controversy. But, my 
preference, all other things being equal, is timely and as-
quick-as-possible response when we get permit applications in.
    Senator Murkowski. We're trying to figure out, in Alaska, 
as we're advancing this--we're looking at other projects that 
are out there. Shell had applied for an application to nearly 
double to size of one of their refineries in Port Arthur--
essentially building a brand new refinery. That permit was 
issued, or just signed off, 11 months later.
    Again, am I trying to compare apples to oranges here? How 
long does it take, typically, to issue a permit for--for 
instance, for an auto factory or a--I mean, how long does 
something like that take?
    Ms. Jackson. Permits can take months to many, many years. 
One of the issues that I think accompanied the Shell permits, 
without in any way trying to be inflammatory, Senator, is that 
there's some amount of controversy over the activity of the 
drilling in the Chukchi. That doesn't influence the EPA's 
decision, but----
    Senator Murkowski. Right.
    Ms. Jackson [continuing]. It probably means--and I've 
discussed this with Shell, and with you, as well--that we know 
that we're subject to challenge for the permits we've issued. 
And we issued, I think, five all together. Two in 2007, one in 
2008, another two in 2010.
    Senator Murkowski. But, again, what we're asking you to 
do--and I said this in my statement--we're asking for the EPA 
to do its job, which is to issue the air-quality permit, not to 
make a determination as to whether or not exploration activity 
offshore Alaska is a go or no-go. Your job is to----
    Ms. Jackson. And I absolutely agree with that----
    Senator Murkowski [continuing]. Issue the permits.
    Ms. Jackson. Senator.
    Senator Murkowski. Right.
    Ms. Jackson. That is not our job----
    Senator Murkowski. Right.
    Ms. Jackson [continuing]. In any way. I just want to, if I 
might, just give a bit of history on with regard to the two 
2010 permits that I know are of great concern to you. The EPA 
issued the proposed permit a month after we got the final set 
of analyses from Shell and the permit application was deemed 
complete. That was July 2009. We received so many public 
comments that we needed to repropose the permit; that was 
January 2010. The final permit was issued just 2 months later, 
March 2010.
    There are examples here where, 6 days after receiving an 
application, the EPA took action on the final application.
    Much of the delay--and I don't mean this as excuse, but 
just a statement of fact--has been the litigation, where these 
permit decisions are challenged. We just recently, a few days 
ago, received the final decision from the Environmental Appeals 
Board on the two permits. And the administrative court upheld 
the EPA on 3 of the remaining 4 permit issues that we have been 
sued by outside groups on. So, it means the permit we issued 
was upheld.
    On the fourth issue, there's a bit more work to be done, 
but I met with Shell. My staff has been meeting with Shell. And 
we believe that the we are on a path to address not only that 
issue, but the other ones raised.

                       NITROGEN DIOXIDE STANDARDS

    Senator Murkowski. One of the things that came up in this 
process--and you referenced the litigation, that's one thing--
but, there were some different standards that were in place 
initially for nitrogen dioxide and no requirement for GHG 
emissions. Now both of those new requirements are being applied 
retroactively on permits that were applied for 4 years ago. It 
gets you in a situation where you've got a lengthy permit 
process. And, working in all due diligence, you've got new 
requirements that then come in, and all of the sudden you don't 
meet them, so it pushes you back even further.
    Now, the EPA decided, last month, to grandfather at least 
one project. I know that the Avenal, the power center there in 
San Joaquin Valley, was grandfathered in so that it would be 
exempted from new rules that had been imposed on new air-
quality standards. You saw fit to grandfather a much larger 
facility from the new requirements, and yet not considering, on 
a smaller certainly, a smaller facility, in terms of emissions 
that we're talking about--you're basically pushing it back and 
saying, ``Well, these now new requirements are now in place, so 
now you must meet them.'' Isn't that a bit arbitrary?
    Ms. Jackson. It's not entirely accurate, if I might, 
Senator. The permit that the EPA issued to Shell, the two 
permits, did not require compliance with the 1-hour 
NO2 standard or any GHG standard. The permits were 
challenged. And one of the things the Environmental Appeals 
Board said was, because of environmental justice, we should at 
least make an analysis of what those standards would mean.
    I just have to say that I believe that the analysis will 
clearly show that there is no public health concern here. 
Environmental justice, I think, is extremely important--but, I 
believe it's important that we be able to show people that this 
wasn't going around a standard, that, in fact, these activities 
will not cause air pollution that will endanger health. And my 
belief is that, as we work, and we've put more resources into 
this. I can get that information to you, I just gave it to 
Shell to make sure that we are not holding anything up, that 
we'll be able to show that.
    [The information follows:]

RESOURCES FOR AIR PERMITS FOR OCS EXPLORATORY DRILLING OPERATIONS IN THE
                                 ALASKA
------------------------------------------------------------------------
                                           FTE \1\ for     FTE for 2010
                Position                       2011             \4\
------------------------------------------------------------------------
Senior Air Management Lead.............          \3\ 0.5        \3\ 0.75
Senior Policy Advisor/Peer reviewer....          \3\ 0.8        \3\ 0.75
Project Manager........................              1.0  ..............
Permit Writer (including regular                     1.0        \3\ 1.0
 analysis) #1..........................
Permit Writer #2.......................          \3\ 0.8            1.0
Permit Writer #3.......................              0.5            0.5
First Line Supervisors.................              0.3            0.2
Attorney 1.............................              0.8        \3\ 0.8
Attorney 2.............................              0.8            0.8
Paralegal..............................  ...............        \3\ 0.3
Alternative Model Approval; Air Quality              1.3            0.9
 Modeler 1.............................
Air Modeler 2 and possibly 3...........      \3\ \5\ 1.0    \3\ \6\ 0.9
Air Quality Monitoring Expert..........              0.2            0.1
Stationary Source Engineer; source                   0.5            0.3
 testing and monitoring expert #1......
Stationary Source Engineer #2..........          \3\ 0.5  ..............
Community Involvement Specialist.......              0.4            0.5
Tribal Consultation Specialist and                   0.2            0.2
 Liaison 1.............................
Tribal Liaison 2.......................              0.1            0.2
ESA Specialist and EJ Specialist.......              0.1            0.1
Administrative staff...................              0.2            0.25
IT services and Web page management....              0.1            0.1
Service Center Contract (copying,                    0.1            0.1
 mailing) \2\..........................
Records Management Contract \2\........          \3\ 0.5        \3\ 0.5
Oil and Gas Program Coordinator........  ...............  ..............
                                        --------------------------------
      Total Region 10 FTE..............             11.7           10.25
                                        ================================
Headquarters legal, policy, and                      2              2
 technical support.....................
------------------------------------------------------------------------
\1\ FTE = Full-time equivalent.
\2\ Contract support expressed as FTE (approximate).
\3\ Resources temporarily assigned to OCS permitting from other programs
  until current permits are completed (total of 5 FTE in 2010 and 4.1
  FTE in 2011). Note: In 2011, Region 10 redirected 2 FTE permanently to
  OSC work: Permit Writer and Attorney.
\4\ Source of this information is from the Environmental Protection
  Agency's Report to Congress on the Outer Continental Shelf (OCS)
  Permits as requested in the fiscal year 2010 Conference Report on the
  Department of Interior, Environment, and Related Agencies
  Appropriations Act, 2010 (House Report 111-316).
\5\ Loan from another Region; salary funds to be used to temporarily
  hire a State modeler.
\6\ On loan from Region 5.

    Senator Murkowski. Well, and I appreciate the fact that you 
have just said that you don't believe that these that this will 
endanger human health, and that's what we're looking at in the 
issuance of these permits. So, then again, it begs the 
question, why it's taking 5 years plus to issue the air-quality 
permits.
    Ms. Jackson. Ma'am----
    Senator Murkowski. Mr. Chairman, my time is expired, and 
I've got some other issues that I want to talk about, but it'll 
be round two.
    Senator Reed. Thank you very much, Senator Murkowski.
    Senator Nelson.
    Senator Nelson. Thank you, Mr. Chairman.

                              CWA PERMITS

    Administrator Jackson, welcome. I want to begin by thanking 
you for, not only coming before the subcommittee today, but 
also for appearing with Secretary Vilsack before the Senate 
Agriculture Committee recently. And I hope we can follow up on 
some of the issues that we discussed at that time.
    One of the concerns that I continue to have is in 
connection with the CWA permits for pesticide application. 
Before the Senate Agriculture Committee, you indicated that 
there was possible misunderstanding on the application of the 
rule and where permits would be necessary. In other words, 
those applicating on cropland would not be subject to a permit. 
I was hoping that maybe you could followup on that and help me 
understand, so that there isn't any misunderstanding.
    Ms. Jackson. Thank you, Senator. I'll try to do it quickly, 
so I don't run out your clock.
    But, remember this permit was required because the EPA had 
made a finding that an additional CWA permit was not needed. We 
were challenged on that finding. And the Sixth Circuit Court of 
Appeals decision in National Cotton said, ``If you were 
applying pesticide permits to the water, you need a CWA permit 
in addition to the FIFRA label and licensing requirements.'' 
So, only those applicators whose intention is to apply to 
water--so they are applying pesticides to water--need this 
additional permit. If----
    Senator Nelson. So, if they apply it to crops, then it's 
not applying it to water?
    Ms. Jackson. That's absolutely right. If you're applying to 
crops, that's not water. Even we know sometimes there small 
amounts that run off. We know farmers and applicators do not 
like that, because they want the pesticides to stay where they 
put them. But and it's not intended to apply to those 
situations, either.

                         PESTICIDE APPLICATION

    Senator Nelson. Also wanted to raise a concern that I had. 
In Nebraska, pesticide application is done along rivers and 
canals to help control invasive species which impact waterflow. 
And my concern is that if it's done along rivers or canals, 
would that automatically trigger a requirement for a permit on 
water, as long as it's being applied to invasive species and 
not intended to be applied to water?
    Ms. Jackson. I believe it's if it's applied over an area, 
including a wetland, that is considered to be a water then you 
would need the permit. I just want to most of the people we've 
been working with are mosquito control districts and people who 
do deal directly in applications either in water or along the 
bank line. And so, that's why we made it a general permit, 
because they generally need a permit anyway in order to apply 
that pesticide. So, this is a notification and will require 
some certifications that you're using minimal amounts of 
pesticide. But, I do believe it would, although we can double 
check that for you, sir.
    [The information follows:]
                     Nebraska Pesticide Application
    The need for a permit is based on whether the pesticide application 
results in a discharge of pollutants to waters of the United States. 
The permit does not cover, nor is permit coverage required, for 
pesticide applications that do not result in a point source discharge 
to waters of the United States. If a pesticide is applied along waters 
of the United States, such as many rivers and canals, and results in a 
discharge of pollutants to waters of the United States (i.e., a 
discharge is unavoidable), then a permit will be required.

    Senator Nelson. Okay.
    Ms. Jackson. And I want to remember we are asked the court 
for more time, until next October, so we don't have a permit. 
So, I'm speaking a bit speculatively.

                   PLATTE AND REPUBLICAN RIVER BASINS

    Senator Nelson. Okay. Well, there are some 50 projects 
along the Platte and Republican River basins, and 80 percent of 
our Nebraska's crop's irrigated, so there are significant 
numbers of canals that run across the State that have to be 
considered, as well.
    So, our people from our natural resources districts were 
just in town, and are in town today. This is one of the 
concerns that they have. And so, if we can find a way to get 
that clear, it would be very, very helpful to them and to our 
office, as well.
    Ms. Jackson. We're happy to sit down with them or your 
staff, sir.
    Senator Nelson. And I want to thank you also for the prompt 
action on the E15 ethanol blend. I think that, clearly, is an 
important thing for us, given the fact that we're facing 
constant challenges with foreign sources of oil at the present 
time. And anything we can do to continue pursue and support 
renewable energy domestic renewable energy, we ought to 
continue to do that. So, I appreciate what you're doing there.

                        SEWER SEPARATION PROJECT

    The final thing I have is sort of a plea for some 
consideration, some help, to figure out how we can deal with 
very expensive long term compliance issues. In Omaha, we have 
the Sewer Separation Project that will cost nearly $1.6 
billion. And, even with any effort to try to get through 
revolving loan funds or other sources of income for that, or 
sources of money, it's virtually impossible to bring that level 
down so that it isn't a huge burden on the ratepayers in Omaha.
    I was struck by what Senator Blunt said about his 
situation, where what the impact could be for businesses could 
result in job losses. It's estimated that the cost to comply in 
Omaha can more than double the within a very short period of 
time--the sewer fees. And so, it's not only the ratepayers, who 
are individuals of the family homes and apartment houses, but 
applies as well, as you know, to businesses, and particularly 
manufacturing operations and others, that might, in fact, have 
higher costs associated with their businesses.
    And I would hope that perhaps we could explore ways to have 
revolving funds of a greater amount. We're talking about this 
in tough budget times, I understand, but if it can be done with 
lower interest rates so that we don't have to go to bonding 
bonded indebtedness. The Nebraskans don't like bonded 
indebtedness, and it doesn't go over very well. The State 
doesn't have any. So, what I would hope is that we might put 
our heads together and see if there are ways to help finance 
those more expensive projects for communities.
    Ms. Jackson. Thank you, Senator. I think that would be a 
great idea, because my experience in these is, oftentimes I'll 
just guess, I do not know for certain that these are the 
results of judicial orders that have strict schedules. No one 
wants raw sewage in the water. That's what the whole point is. 
But, in tough times, we have had a number of municipalities 
come in and say, ``Can we talk about either alternate methods 
or alternate timetables that would give us a bit of relief?'' 
So, I would be happy to have my Region 7 office have those 
conversations with Omaha.
    Senator Nelson. Thank you. And again, thanks for being 
here.
    Thank you, Mr. Chairman.
    Senator Reed. Thank you, Senator Nelson.
    Senator Cochran.

                         GULF COAST RESTORATION

    Senator Cochran. Madam Chairman, in looking at your 
statement, on page 4, I noticed this provision. It says, ``As 
chair of the Gulf Coast Ecosystem Restoration Task Force 
established by Executive Order 13554, I will work with the 
Federal and State task force members to lead environmental 
recovery efforts in the region. The EPA is also working to 
support the Federal and State trustees on the Deepwater Horizon 
Natural Resource Damage Assessment and Restoration Trustee 
Council as they develop a restoration plan to restore the 
region's natural resources to pre-spill conditions.'' Then 
there's this sentence, which concludes the paragraph, ``As a 
complement to these efforts, the EPA's request of $6.6 million 
for the Mississippi River Basin Program, will address excessive 
nutrient loadings that contribute to water quality impairments 
in the Basin and ultimately to hypoxic conditions in the Gulf 
of Mexico.''
    I was following that pretty well until I got down to the 
end and saw that last sentence. And I read it again, and I 
thought what in what does that mean? Can you answer my 
question? What does that mean?
    Ms. Jackson. I'll try, Senator. It's meant to outline a 
number of initiatives, all of which, I hope, will have the 
impact of a better Gulf of Mexico.
    On the hypoxic issue, the end of the statement, there's 
obviously nutrients that come down the Mississippi River to its 
mouth. We now have created a zone along the gulf coast of the 
United States, in parts of Texas and Louisiana--I think a bit 
in your State, as well--that where the nutrient levels have 
caused algae to grow so much that they've taken the oxygen out 
of the water. That's harmful for the ecosystem. Obviously, 
clearly harmful for the seafood and other fish that breed, the 
nurseries of life that they are. And that growing area of 
hypoxia has been a concern of the EPA's since long before the 
spill.
    I believe we either have or very shortly are putting out a 
framework. It's State leadership that's needed here. And it is 
not--there's been some concern that the EPA's going to sort of 
take over and come up with nutrient standards along the Basin. 
I don't think that will work. I don't think that kind of 
command-and-control approach will work. But, States have 
started to do wonderful things on bringing their nutrient 
loadings down so that, by the time that the water gets to the 
mouth of the Mississippi, we see a significant reduction in 
nitrogen and phosphorous.

                              BP OIL SPILL

    Senator Cochran. Well, I'm a little skeptical that we may 
be--if we do nothing and don't say anything in our report about 
monitoring this program, that we are really writing a blank 
check, not just for $6.6 million, which is a lot of money to 
me, to deal with a problem that obviously existed before, and 
will exist after, the calamity of the BP oil well that was way 
out in the Gulf of Mexico and was not affected at all by what 
comes down the Mississippi River.
    Ms. Jackson. No----
    Senator Cochran. You know, it looks like a big reach--a 
reach for added jurisdiction and a blank check, really. Well, a 
$6.6 million check----
    Ms. Jackson. Right.
    Senator Cochran [continuing]. Which is kind of big.
    Ms. Jackson. I apologize if my statement is confusing, 
Senator. The Gulf of Mexico programs and the Gulf of Mexico 
Alliance have been working together with upstream States to 
deal with the hypoxia issue for a long time. And the EPA has 
actually had that program working for quite some time. They are 
unrelated to the actual incident of the Deepwater explosion, 
but not entirely unrelated from the purpose of the Gulf Coast 
Task Force, which I chair, which is to help the gulf become 
healthier overall. And, of course, if you talk to people who've 
been watching this growing red area of hypoxia off their shores 
for a long time. It's one of the things, in our first two 
public meetings, that we have heard about already.
    So, they are intersecting, but they are certainly not meant 
to say that the oil spill had anything to do with the hypoxia.
    Senator Cochran. Okay.
    Thank you.
    Senator Reed. Senator Collins.
    Senator Collins. Thank you, Mr. Chairman.

                        ETHANOL-BLENDED GASOLINE

    Administrator, let me start with an issue that I hear about 
frequently from my constituents. I get calls, emails, letters, 
conversations all the time about constituents who are finding 
great difficulty in using an ethanol blended form of gasoline, 
because it causes problems in their older cars, their boats, 
their snowmobiles, lawnmowers, offshore, or off road vehicles. 
And this comes up over and over again. And my constituents are 
experiencing these problems even with an ethanol blend of just 
10 percent.
    So, Senator Cardin and I wrote to you, and introduced 
legislation as well, urging the EPA not to grant a waiver 
allowing E15 to be sold until we resolved some of the problems 
that ethanol was causing for these smaller engines. 
Unfortunately, the EPA went ahead and granted this waiver for 
use in automobile model years, I guess, 2001 and higher, and 
newer light duty vehicles. But, of course, the problem is that 
a lot of times the ethanol blends are not going to be 
segregated at gas stations, and it's going to cause some 
misfueling and some further problems.
    Let me say, right up front, that I am not a fan of the $6 
billion that we spend each year on corn-based ethanol. If I 
were making cuts in the budget, that would be very high on my 
list. But, we do have mandates existing--ethanol mandates--that 
the energy, agricultural, and automotive sectors of our economy 
are already struggling to comply with. So, why did the EPA make 
it worse by approving E15?
    Ms. Jackson. Well, the EPA received a waiver request from 
Growth Energy, an industry group, asking for us to review their 
application for 15 percent ethanol.
    I have to be clear, this not a mandate. The EPA does not 
mandate that E15 be sold. In fact, what the EPA is required to 
do by law is to respond to, or make determinations about, the 
safety of various ethanol blends in gasoline. We did that by 
relying on extensive testing of cars, most of it done by the 
Department of Energy. This took them $40 million. It took many, 
many months. The waiver is based on the science, and only the 
science. The EPA is currently required by law to work on a 
label to prevent misfueling at stations.
    For E15 to enter the market there are several other things 
that have to happen--most of them absolutely unrelated to the 
EPA, they have to do with State law and other Federal 
agencies--and the EPA's not--it's not the EPA's job to make 
those determinations about what gets sold, but simply to answer 
the questions that were put to us under Integrated Science 
Assessments (ISAs).
    Senator Cochran. Well----
    Ms. Jackson. ISAs gives us that.
    Senator Cochran [continuing]. You didn't have to approve 
the waiver request, however.
    Ms. Jackson. That's absolutely right, Senator. But, the 
requirements of the CAA basically tell us that a waiver can be 
granted when you can show that it will not harm vehicles, among 
a number of criteria, I don't have them in my head right now.
    Senator Cochran. But, it is harming vehicles. I'm going to 
start sending over to you every email I get from Maine from a 
Mainer who's had his snowmobile engine ruined or his lawnmower 
or boat engine fouled because of the concentration of ethanol. 
In Maine, we have a lot of older cars. Maine is a low-income 
State. And a lot of people are driving older vehicles and are 
already experiencing problems with the E10 mix. And they're 
really concerned about what it's going to mean when you go to 
E15.
    And think of the gas station. I mean, you're correct that 
they can still sell E10 as well as the E15, but there's 
infrastructure costs in having a separate pump, a separate 
label. How is the EPA going to deal with that?
    Ms. Jackson. Again, Senator, the EPA denied the waiver for 
snowmobiles and yard equipment and marine engines. What we did 
was make a science-based finding that, for automobiles only, in 
model years newer than 2001 and including 2001, there wasn't a 
reliability or safety problem with E15. The EPA doesn't have a 
mandate that E15 be used, but I understand your concerns. Our 
jurisdiction, if you will, extends to a labeling rule, to 
putting out a label to help consumers know what the fuel can be 
used for, which is only 2001-and-newer cars.
    Senator Collins. But, I think you're ignoring the reality 
that there are already problems for these--for the 
snowmobilers, for the lawnmower operators, for boat, 
lobstermen, et cetera, using E10. So, it is not of comfort to 
me when you say, ``Well, there'll be a label for E15.'' Plus, 
there's a considerable cost to a small gas station to have 
another pump that has E15--it is separate. Why should they 
carry two kinds?
    I just hope the EPA will take a closer look at the 
implications. And I really am going to start sending over those 
complaints so that you can explain to my constituents why their 
engines are being fouled.
    Thank you, Mr. Chairman. I'm going to save my next 
question, because I'm out of time.
    Thank you.

                            GHG REGULATIONS

    Senator Reed. Thank you very much, Senator Collins.
    I'll begin the second round by following up with a final 
question in the whole context of the GHG regulations. And the 
proposal in H.R. 1 might sort of create a catch 22 situation. 
That is, as I understand it, you would be prevented from, 
essentially, issuing permits. Yet the law would still be on the 
book, which could open projects to legal challenges under the 
CAA, et cetera. But, can you sort of help us understand how--if 
H.R. 1 or something like it was passed, how it would impact the 
ability of the States and the EPA to issue permits and to avoid 
this unwitting, or witting, sort of gridlock, if you don't have 
the authority, yet the law's on the books, and people can go 
into court and say they're violating the law.
    Ms. Jackson. Right, well, as I mentioned earlier, Chairman, 
we have 100 permits already filed for GHG. So, there is a GHG 
rider that was included in H.R. 1, and it would preclude the 
EPA from issuing preconstruction permits, which are the permits 
that these 100 applications are for, in those States and 
territories and areas where the EPA is the permitting 
authority. It is sometimes the State and sometimes the EPA.
    So, you're talking about California, Florida, Idaho, 
Kentucky, Massachusetts, Oregon, Texas, Wyoming, Puerto Rico, 
Virgin Islands, OCS, offshore deepwater ports, Arizona--I think 
there's one other.
    And you're right, it would be something of a catch 22, 
because the CR doesn't affect the obligation, the underlying 
statutory obligation to obtain a permit; it simply affects the 
EPA's ability to issue or act on the permits. And so, people 
would have an obligation to obtain a permit the EPA could not 
issue, by law.

                       FUEL-EFFICIENCY STANDARDS

    Senator Reed. Thank you. Turning now to fuel-efficiency 
standards, we are already extremely sensitive to rising 
gasoline prices. They're about $3.57 in Rhode Island, but when 
I go back this weekend, they'll probably be closer to $3.80. 
And I think we all recognize that one of the ways to deal with 
this energy crisis is simply demand reduction. And, what's 
happened with the car industry--beginning with the 1970s and 
CAFE standards, is that increased mileage has helped avoid 
millions of gallons of gasoline use.
    You're now talking about 35.5 miles per gallon by 2016, 
with your fuel-efficiency standards. Some people have suggested 
that'll save about $3,000 over the life of the car, in terms of 
avoided gasoline cost. Of course, that number goes up as the 
price of gasoline goes up. And there's a proposal, I believe, 
to increase it to 60 miles per gallon by 2015, with additional 
savings.
    Today, in this budget, there's $5.2 million for developing 
fuel-economy standards out to 2025 and $10 million for a first-
time program to try to improve the efficiency of medium and 
heavy trucks.
    Can you share with us, or confirm the savings that seem to 
be inherent in these proposed investments of, relatively, a 
small amount of money?
    Ms. Jackson. Certainly, sir. I think you kind of hit it on 
the head in your question. I think the current law actually 
required us to get to 35.5 miles per gallon by 2020. The 
President's clean car rules got us to 35.5 by 2016. So, we're 4 
years early. And he's already ordered the EPA and the 
Department of Transportation to work together on the next 
generation, which is 2017 model year, all the way out to 2025. 
We are doing that.
    We are also working and sharing data with the State of 
California, because the CAA gives California different 
jurisdiction over pollution emission from automobiles. The 
EPA's role is actually under the CAA and has to do with GHG 
emissions. The CAA is a really important piece of the puzzle, 
because the CAA has strong enforcement teeth. Companies can't 
build a bigger gas-guzzling car and simply pay small fine, as 
they could under the National Highway Traffic Safety 
Administration (NHTSA) rules and under NHTSA's authority. Under 
the CAA, they must comply.
    And we have estimated that, in the rules done so far, if 
you took the CAA out of that equation, you'd lose hundreds of 
millions of barrels of oil savings, because companies would 
simply just pay the fine rather than build the more fuel-
efficient cars that we need and that Americans are buying.

                    STATE REVOLVING LOAN--FUNDS CUTS

    Senator Reed. Thank you. A final point, my time is rapidly 
declining--Senator Collins alluded to this, I've said it also--
the State revolving loan-fund cuts. There was, as I understand 
it, a significant increase in the 2010 budget. And a lot of 
that was directed at, not only helping communities struggle--
and I think Senator Nelson was talking about it also--in terms 
of dealing with required improvements in sewer systems and 
other systems, that ultimately get passed on to ratepayers if 
the local agency is the only source of funds.
    We are proposing now, in this budget, to reduce, 
significantly, those funds, which shifts the burden onto local 
communities and also may very well have the effect of stopping 
projects or not even putting projects in even a planning phase, 
which means jobs.
    Have you looked at the job effect of these proposed cuts?
    Ms. Jackson. We haven't done a jobs analysis of the 
proposed cuts. I would only offer a few things.
    This is one of those tough choices that's certainly hard, 
as Administrator of the EPA, to swallow, but I swallow it and I 
embrace it, because I think we looked across at a couple of 
things on the landscape that--when the President came into 
office, the Recovery Act put $6 billion to water and 
wastewater. Most of that money was required to be obligated 
within 18 months, and it was; but some of it is still hitting 
the streets in the form of projects that continue to be 
constructed and people who are getting paid, therefore have a 
paycheck as a result of that. His first budget also 
dramatically increased the amount of money for water and 
wastewater funding again. And so, yes, this is a cut, but it's 
still much higher than these funds we're seeing when he came 
into office.
    And so, I would simply say that, yes, there is great 
leveraging that goes on, both in the drinking water and 
wastewater side. They're also revolving funds. So, part of what 
we're also hopeful of is to see some of those $6 billion in 
loans start coming back into the fund, repay the fund, and 
hopefully get us to a state where we can ensure that our 
communities have clean drinking water and adequate sewage.
    Senator Reed. Thank you very much.
    I'm going to recognize Senator Murkowski. And since Senator 
Blunt hasn't had his first round--my preference, unless you 
have a problem, Senator--would be to recognize Senator Blunt 
then Senator Collins.
    Senator Collins. Absolutely.
    Senator Murkowski. I'll defer to Senator Blunt before I ask 
my second round.
    Senator Reed. Thank you.
    Senator Blunt.
    Senator Blunt. Thank both of you. And thank you for having 
patience with me.
    Administrator, I may have asked questions here that have 
been asked before. And, if I do, I apologize for not being here 
to hear your answers before.

                         COST-BENEFIT ANALYSIS

    So, one of my questions would be--the Supreme Court 
recently rejected the idea that, because cost-benefit analysis 
isn't expressly authorized, it can't be used. And I'm wondering 
when and where you use cost-benefit analysis in your rulemaking 
process?
    Ms. Jackson. We do cost-and-benefit analysis, as well as 
jobs analysis, with most of our rules, not absolutely all of 
them. We do have some laws--the CWA is one of them--which 
require us to consider additional factors. We still look at 
cost, we still look at benefits, but often public health or 
safety are issues in the statute that we are specifically told 
that trump a cost-benefit----
    Senator Blunt. Is that cost-benefit analysis available? Is 
it part of the record? How does somebody access that, that 
isn't at the EPA?
    Ms. Jackson. Yes, sir. It's part of the rulemaking docket. 
It's part of the rulemaking record. So, it would be part of the 
rule, there'd be an explanation of those analyses. And they 
would be part of the docket, if someone wanted to get into 
looking at the full analysis.
    Senator Blunt. And there are cases like--what did you say, 
CWA and CAA?--where the overall mandate, in your view, 
overrides that as a criteria?
    Ms. Jackson. Well, it's not my view, sir. The law will, in 
some cases, make clear that the job of the Administrator is not 
to balance cost at this stage or another. So, in parts of the 
CWA, parts of the----
    Senator Blunt. So, the law actually says that in some 
places, that you shouldn't balance economic cost?
    Ms. Jackson. In setting health standards under the CAA, the 
NAAQS, the law says that those standards are to be based on 
protecting public health with a reasonable margin of safety, 
specifically not asking for cost analysis. We do them anyway, 
as a matter of information, because people ask. But, there are 
places where the law constrains us, to some degree. It's not 
very often. And, even in those cases, I think the EPA leans 
into the idea of presenting cost and benefit and jobs analysis, 
where we can do it, because it always comes up.
    Senator Blunt. Well, I'd say lean harder, when you can. 
It's really an important part of what you're doing.

                           AGRICULTURAL DUST

    You know, I mentioned a couple of areas earlier that impact 
the agricultural economy. On this pursuit of the rule on dust 
and fugitive dust, is there any known technology available that 
would really be able to stop dust from moving around? I mean, 
I'm enough of a farm boy to know you can't farm in the mud. So, 
you're going to have some dust in farming; you're going to have 
some dust in harvesting. I'd love it if you'd tell me that the 
whole--the rural concern about this is blown out of proportion 
and you really understand that you're going to have dust, and 
you know that even the Federal Government's not big enough to 
do anything about that. But, I'm anxious to hear what you think 
can be done about fugitive dust.
    Ms. Jackson. The EPA has not proposed to regulate 
agricultural dust. The EPA does not have any plans to regulate 
agricultural dust. The EPA understands, as I said in a earlier 
hearing, that dust happens, especially in rural America.
    The confusion seems to stem from a requirement of the CAA 
for particulate matter, for the particles, that lodge in lungs. 
There's fine particles and coarser particles. Every 5 years, 
the requirement, under the CAA, is that a scientific advisory 
board, independent of the EPA, acts in an advisory role and 
advises the Administrator on whether current standards for 
coarse and fine particles are protective. That report has come 
in, but no staff recommendations about any standards have been 
made to the Administrator.
    Senator Blunt. And would that particulate matter 
occasionally be something we call dust?
    Ms. Jackson. It could include dust, yes. But, fine 
particles are not dust. Coarser particles can include dust. 
But, the EPA's standards, which would be health standards, back 
to your earlier question, could potentially include coarser 
particles.
    I should note, the EPA's in the process of holding 
listening sessions with stakeholders across the country. We've 
particularly focused on rural areas. I think there was just one 
in Idaho. We're looking, we're listening. And, by this summer, 
I will be required to either propose to retain the current 
PM10--that's, of course, the particle standard--or 
change it. That would be a proposal, subject to public comment, 
with the full record for review by anyone who has an interest.
    Senator Blunt. Well, I think the one thing--one of the 
things Government always wants to do is be sure that public 
comment doesn't become public ridicule, that anytime we set 
standards, or even have discussions that are outside of the--of 
a possible solution. And I'll look carefully at what you all 
propose. But, I know this is something that just seems like the 
Government, even having this discussion, really doesn't 
understand what happens out there to feed and clothe the 
country.

  SPILL PREVENTION, CONTROL, AND COUNTERMEASURES (SPCC) RULES AND MILK

    On the milk issue, I think your own internal estimate was 
that this new regulation could cost dairy farm families, dairy 
farmers, $155 million. And as--I believe this is because the 
EPA's view is that, since butterfat includes oil, that it 
triggers a hazardous spillage when your milk tank ruptures or 
something. Are you really pursuing that?
    Ms. Jackson. No, sir.
    Senator Blunt. No.
    Ms. Jackson. No, sir.
    Senator Blunt. We're you asked about this by the 
Agriculture Committee, also?
    Ms. Jackson. Yes, sir. It was one of my five myths about 
the EPA and agriculture.
    The EPA has actually proposed an exemption from the SPCC 
rules. Those are rules that generally handle large amounts of 
oil to prevent them from spilling into waterways. The EPA 
proposed an exemption for milk, because, without a clear 
exemption, you could read the law or our current regulations as 
somehow bringing milk in. So, it was the EPA who was working 
with the dairy industry and its representatives to come up with 
the idea of an exemption. And that exemption will be finalized, 
I believe, within the month.
    Senator Blunt. Are you telling me the dairy industry asked 
you to look into this?
    Ms. Jackson. I wouldn't say--I cannot attest to whether 
they asked or we asked. I would say our staff were in 
conversations long before I became administrator. And one of 
the things that was agreed upon, and was hailed by the dairy 
industry, was clarification that milk was not subject to SPCC 
requirement.
    Senator Blunt. Well, I'm generous with your time, Chairman. 
I think I've used my initial time up.
    Senator Reed. Senator Murkowski.
    Senator Murkowski. Thank you.
    Not coming from a farm or an agriculture State, I think the 
common person would look at this and can't believe that we're 
having a conversation that we would be regulating milk as an 
oil product and need to have some kind of a response plan. But, 
that's not my question, Administrator. We're--you're good with 
that.

                        GHG REGULATION UNDER CAA

    It does go back, though, to a question that Senator Blunt 
had raised. And this goes to the cost-benefit analysis and all 
that goes into that. At a hearing that we had before the Energy 
Committee last year, I asked you a number of questions about 
the implementation of the new GHG regulations under the CAA. 
And, at that time, after those questions that I posed, I sent 
you a pretty lengthy letter asking a series of questions. I am 
still awaiting a response to many of those.
    But, one of the questions that I asked was whether or not 
the EPA had conducted a full analysis of the economic costs, 
including job losses. And I heard your response to the Chairman 
about what you perceive to be the job gains. But, the question 
is whether or not such an analysis has been conducted of the 
full implementation of the GHG emissions once you have fully 
phased in even the small emitters. And, if the answer to that 
question is yes, I would ask that you provide the subcommittee 
with a copy of that. And, if you have not yet conducted an 
analysis, I guess the question would be, Are you considering 
conducting such an analysis?
    Ms. Jackson. Senator, there is no analysis to give you. 
Looking forward many, many years, I think the accuracy of such 
an analysis would be subject to a wide margin of error, because 
we are doing these rules slowly, methodically almost, starting 
with the very largest sources, and mindful and hopeful that, at 
some point, the Congress may choose to take actions that will 
impact smaller sources in different ways.
    So, we are doing cost analysis as we roll out actual rules. 
For example, in the summer, when we propose GHG efficiencies 
and steps for the power sector, there would be analyses there.
    Senator Murkowski. And those analyses, as you have 
indicated to Senator Blunt, would be available through the 
whole rulemaking process that you have, that that cost analysis 
would be included.
    Ms. Jackson. Yes, Senator.

                              ARNI AND COE

    Senator Murkowski. Okay. I want to gain a little more 
understanding about ARNI. ARNI is now the first name that 
everybody has gained an association with in Alaska. And any of 
you that have rivers in your State, I would suggest you get to 
know ARNI, too. This is the ARNI. I mentioned this in my 
opening statement.
    I had asked you, Administrator Jackson, for just an 
understanding as to how does an ARNI designation come about, 
when is it applied. In response, I'm told that--you've 
indicated that you've only designated ARNIs on 1 percent of COE 
permits. But, you're citing 6-year-old data. And the letter 
goes on to state that you don't have any more recent nationwide 
data on how often or where the authority is being invoked.
    So, what I'm trying to figure out is, Do we know, or does 
anybody within the EPA know, what, precisely, is or is not an 
ARNI, and exactly how often this designation is being used 
nationwide?
    Your letter refers to a case-by-case designation within 
regions, which, from where I'm sitting, makes it sound--it 
sounds pretty arbitrary. What we are faced with--we just had 
the--a project in the interior of the State be denied because 
of an ARNI designation on the Tanana River. If you are an 
investor or if you are--in this case, the railroad was looking 
to put a bridge across--had no idea that the Tanana River would 
be designated as an ARNI. How do you anticipate, in advance, 
whether a given body of water is subject to such a designation?
    So, I'm trying to understand a little bit more about how 
this operates within the EPA, in terms of a given designation.
    Ms. Jackson. Thank you, Senator. As I think I said in the 
response, the designation is triggered in response to permit 
actions. It is--it grows out of a 1992 agreement between the 
EPA and the COE. And the designation of ARNI specifically does 
not have the effect of denying a permit. I can't confirm for 
you, but I will check and get back to your staff. I know--I 
believe the ARNI designation on CD 5 came after the COE 
determination that the permit proposal wasn't compliant with 
404. I could be wrong on that, Senator----
    Senator Murkowski. I think----
    Ms. Jackson [continuing]. But I will double check.
    Senator Murkowski [continuing]. We want to check on that.
    Ms. Jackson. Yes, okay. I will. So, I'll take that 
statement back.
    [The information follows:]

               Designation Within Regions (Tanana River)

    On June 9, 2009, the Environmental Protection Agency sent the Corps 
of Engineers (COE) a comment letter identifying that the CD-5 pipeline, 
as proposed, may result in substantial and unacceptable impacts to the 
Coleville River Delta, and identified the Coleville River Delta as an 
Aquatic Resource of National Importance (ARNI). After completing their 
review of the proposed project, the COE denied the application for the 
CD-5 pipeline in February 2010.

    Ms. Jackson. But--we need to look at timing--but, I think 
the important thing is that I don't see the ARNI designation, 
which, as you mentioned, is used pretty infrequently. Looking 
back historically, the data we had in-house said 1 percent of 
CWA action, section 404 individual permit (IP) actions. The COE 
reviews 3,000 to 5,000 IPs, permit applications, annually. I'm 
told that the working relationship right now between the COE 
and with the State of Alaska and the EPA regional office out 
there is very good, and that this coordination's going to be 
important, because I think everyone involved understands the 
importance of these resources, not only to ConocoPhillips, but 
to the Nation's energy and economic security.
    Senator Murkowski. Well, we all need to be working together 
on it, but I--part of the concern that we saw with CD-5 and the 
designation up there is, the COE had approved a project. All 
the stakeholders involved had agreed that this was the project. 
Great public input on that. And then the EPA designation comes 
in and essentially circumvents that public input. And there is 
no public process with an ARNI designation, is the concern.
    Ms. Jackson. Yes.
    Senator Murkowski. And again, with very vague, or seemingly 
vague, criteria so that you do not know--you have no idea, 
going into it--whether or not this designation will be made 
after the fact, after the process has been well underway, and 
after a great deal of money, in many cases, has been put toward 
it. And again, we're seeing and we have seen this now in two 
critical, critical infrastructure projects, one that would 
advance oil and gas development in the NPR-A, one that would 
allow for access to military training grounds for our military, 
and we can't get a bridge across yet another river. So, we need 
to better handle, in terms of what is what the criteria is and, 
more importantly, avoiding any arbitrary definitions that we 
might see on a region by region or, as you say, a case-by-case 
basis.
    Ms. Jackson. Senator, just three things. It is important to 
recognize that the COE permit denial was because the COE found 
that there was a less damaging alternative that was available 
to ConocoPhillips to meet the project purpose, not because of 
the EPA's ARNI designation.
    Number two, that being the case, I do believe--I want to 
state again that the ARNI designation is not in any way a 
denial of a permit, or does not mean that a permit is denied. 
It is simply a recognition of extraordinarily sensitive natural 
resources that may be in the area. And I don't think that it is 
indicative of the permit.
    And, last but not least, we are not regulating milk. We are 
not regulating milk.
    Senator Murkowski. And I would just add for the record 
here, cracker-jack staff says that the ARNI designation on CD-5 
was the summer of 2009, and the COE denial of the--of going 
forward with the bridge was February 2010. So, the ARNI was, in 
fact, designated first. Or that's what I'm told.
    Ms. Jackson. Yes, and I think that the COE denial talks 
about the need to look at less-damaging alternatives. And I 
think that gives us some real places to work with the State and 
the COE, I think--I hope, productively.
    Senator Murkowski. Mr. Chairman.
    Senator Reed. Senator Collins.
    Senator Collins. Thank you, Mr. Chairman.

                           BOILER MACT RULES

    Administrator, I want to go back to an issue that I raised 
in my opening statement about the EPA's proposed maximum 
achievable control technology rules for boiler emissions.
    As I mentioned to you back in September, 41 Senators wrote 
to you to express great concern about the proposed EPA rules in 
this area. And they joined a letter that Senator Mary Landrieu 
and I led. But, I would note that what's remarkable about this 
letter is, it's almost equally divided between Democrats and 
Republicans, reflecting widespread concern, bipartisan concern, 
about the proposed boiler MACT rules. And we wrote then that we 
were concerned that they would result in significant job losses 
to the forest products industry at a time when the industry was 
really struggling, laying off workers, mills were closing, and 
that we also were concerned that it would discourage the use of 
wood biomass in woodpulp and paper facilities.
    To the EPA's credit, you answered our letter very quickly 
and said that you would take another look at the rules. And I 
know you tried to get additional court time, and could only get 
an additional month, rather than the 15 months, I think it was, 
that you requested. Nevertheless the final rules came out last 
month. And the initial estimates by the American Forest and 
Paper Association is that even the final rules would lead to 
the loss of thousands of jobs, at a time when our economy can 
least afford it.
    I know the EPA has claimed that the final rule--the cost of 
the final rule has been lowered by 50 percent. I have to tell 
you that that's cold comfort to me, because the initial rule, 
according to industry estimates at least, was something in the 
neighborhood of $3 billion in capital costs, and more than $11 
billion for all manufacturing. The $3 billion was just for the 
forest products industry. In Maine, the forest products 
industry estimated that the initial rules would cost $640 
million in compliance costs. So, even if you cut that in half, 
that is huge. It's still a huge, onerous, costly burden on an 
industry that is just barely starting to recover from the deep 
recession.
    So, I have a number of questions for you. One is, it's my 
understand that, under the CAA, the Congress has given the EPA 
the authority to develop alternative standards for emissions 
with health thresholds in cases where the regular MACT limits 
may be, quote, ``far more stringent than necessary to protect 
public health.'' Back in 2004, the EPA did use a health-based 
approach. Why wasn't a health-based approach used this time?
    Ms. Jackson. There was significant analysis, Senator, of 
exactly that point, whether there was justification for a 
health-based emission limit--they're called HBELs--under the 
law. And those standards were not justified, in our opinion. 
There was significant comment on it. We heard from many, many 
people. But, at the end of the day, in the final standards, we 
did not believe that they were justifiable, and did not provide 
the protection from toxic air pollutants that the law required.
    Senator Collins. Well, I have to say that the Congress gave 
you that authority for a reason. And to set limits that are far 
more stringent than necessary to protect public health, at a 
time, particularly, when the economy's very fragile, really 
concerns me. Is the EPA going to accept further public comments 
on the rules that were published last month, on February 23?
    Ms. Jackson. Yes, Senator. Using the reconsideration 
process, which is part of the CAA that's----
    Senator Collins. Yes.
    Ms. Jackson [continuing]. Built into the law, we are 
soliciting, and now accepting, comments from members of the 
public, because the final rule was significantly different than 
the proposal.
    Senator Collins. And how long--since, as you point out, the 
final rule is significantly different--how long do you expect 
that public comment period to be?
    Ms. Jackson. I believe it's 60 days, Senator. I don't know; 
I believe it's 60 days. But, we'll get back to you for the 
record.
    [The information follows:]

                              Boiler MACT

    Groups representing sources covered by the rules have recently 
filed a petition for an administrative stay of the Boiler MACT rule. 
The Environmental Protection Agency (EPA) has also received a petition 
for judicial review of the rule and a petition for reconsideration of 
aspects of the rule. The EPA intends to make a decision regarding a 
stay of the effective date of the rule by May 20, 2011, when the rule 
is scheduled to go into effect. At the time the EPA makes a decision, 
we will discuss a tentative schedule for the process which would 
include an opportunity for public comment.

    Senator Collins. I hope that it would be as long as 
possible, 60 to 90 days, so that there can be ample time to 
review the rules. The mills in my State have started doing 
their analysis. They still have many, many concerns about what 
the impact would be. I know the White House is asking the EPA, 
and indeed all agencies, to take a hard look at pending rules 
that have an impact on job creation and preservation. And I 
certainly think this falls in that category.
    Ms. Jackson. Thank you, Senator. We are--there is a 3-year 
compliance period for these standards. And I expect, as part of 
the reconsideration, we may be asked to delay the effective 
date, while we're in the reconsideration process.
    I do want to point out, because I think I might not have 
been clear, that when we looked at the health-based emission 
limit, we looked as to whether there was another standard that 
would be protective for mercury, lead, arsenic, all of the acid 
gases included in the rule. But, the rule, while being much 
cheaper, has phenomenal public health benefits that I don't 
want to have overlooked. By the year 2014, when it's 
implemented, you know, 2,500 to 6,500 premature deaths avoided, 
1,600 cases of bronchitis, 4,000 nonfatal heart attacks.
    I am all for finding the absolute cheapest way to get 
public health protection, but I didn't want you to think that 
we had rejected that kind of approach. In fact, we looked at it 
and determined that the technology allows us to get protection 
without the need for any additional health-based standard.
    Senator Collins. Well, I would suggest that all of us want 
those public health benefits. They're extremely important. The 
CAA was authored by Senator Ed Muskie, and our State is very 
proud of that fact. But, clearly, the proposed rules--the 
initial rules were a gross overreach. I think the EPA is making 
progress in reducing the costs and coming up with a more 
practical approach. But, I still think we can achieve the 
health benefits that we desire without putting thousands of 
people out of work.
    Thank you, Mr. Chairman.
    Senator Reed. Thank you.
    Senator Blunt, questions?
    Senator Blunt. Yes, thank you, Mr. Chairman.
    On that boiler MACT issue--I signed a letter on that 
recently, myself--would you have somebody send me the cost-
benefit analysis out of that rulemaking process?
    Ms. Jackson. Certainly, sir. We can get you--
    [The information follows:]
          Regulatory Impact Analysis (RIA) for the Boiler MACT
    The URL for the RIA is http://www.epa.gov/airquality/combustion/
docs/boilerria
20100429.pdf

    Senator Blunt. Thank you.

                           NEW SOURCE REVIEW

    On the New Source Review--I mentioned the Ameren action 
earlier, that I've sent a couple letters on. I think that that 
was almost 10 years ago, almost decade ago, when that change 
was made so they could burn more low-sulfur coal. It seems 
like, to me, that's a pretty long reachback for a review. I 
wonder why nobody did that in the EPA before now. And how long 
do you think the reachback from New Source Review might go?
    Ms. Jackson. The New Source Review requirements of the CAA 
came into place, I believe, in the 1977 amendments. And----
    Senator Blunt. Right.
    Ms. Jackson [continuing]. So, what they essentially do is 
say that, when a plant is making a significant investment to 
upgrade or rebuild, they should also invest in pollution 
control. So, the cases, which have been pursued since 1999, not 
necessary against Ameren, are lookbacks to see if companies, 
when they made significant changes to their operations, did 
indeed comply with the law by also upgrading their pollution 
controls. Ameren announced, I think in February, that it's 
going to install scrubbers to address sulfur dioxide at two 
facilities. I can't talk about the specifics of the case that's 
pending. It's in litigation over at Department of Justice. But, 
that is a nonattainment area for sulfur dioxide. It's one of 
the largest sources of pollution in the State.
    Senator Blunt. And how do you find out that these plants 
are making these changes in the plant?
    Ms. Jackson. I haven't done these cases in a very, very 
long time, sir--but, generally, back when I did them, it relied 
on information from the energy administration. You would see 
large increases in energy output or in bids into the grid, 
depending on whether they're a regulated or nonregulated 
utility. And then from there you could use information 
gathering authority under the CAA to determine whether a 
violation of the law had----
    Senator Blunt. And if you see those output increases, then 
you just routinely go in and check and see if they've done 
anything to change the facility?
    Ms. Jackson. There's also the routine checks that come as 
part of the permit process. But, that would be the first thing 
that might get an inspector or an enforcement agent concerned; 
if they start to see huge amounts of energy increase, that 
means you're burning more fossil fuel, which means more 
pollution. And the question is, Has there been an investment in 
reducing the air pollution that's concurrent with that?
    Senator Blunt. Yes, it just seems to me it took an awful 
long time to--either for them to get their output up or for the 
EPA to decide this was something they wanted to look at, if 
it's almost a decade after the change was made and then 
suddenly there's an enforcement action. But, we'll continue to 
talk about that. I am concerned about it.

                             COOLING TOWERS

    On the cooling-tower issue, I think I've seen one estimate 
of cost of added cooling towers to powerplants, to all the 
powerplants that may need them, would cost up to $60 billion. I 
think all that--in virtually every State, there's a process to 
pass that along as part of the utility rate or--how do you 
think--what's your sense of how you approach the cooling-tower 
requirement? Are you going to look at every powerplant and try 
to come up with--help them come up with the best cost-effective 
thing for them? Or is there going to be a cookie-cutter 
process, here, that you have to meet these criteria in this 
size plant? Or what are you going to do there?
    Ms. Jackson. Well, the EPA is working on a rule, sir. 
That's as a result of a couple of Supreme Court--I think 
they're Supreme Court cases. I really do not want to get in 
front of the rulemaking process--we'll make a proposal; it'll 
be out for public comment. The one thing I have said publicly 
is that I don't believe in a one-size-fits-all approach on that 
issue. So, I think that there is certainly some amount of 
judgment. New facilities are different than older facilities.
    Senator Blunt. Well, we're--you know, that's obviously a 
big change in all of these facilities, if it happens. And I'll 
watch that, as well. But, I'm going to be particularly 
interested to see the cost-benefit analysis from the boiler 
MACT rulemaking, and look forward to getting that.
    Thank you, Chairman.
    Senator Reed. Thank you, Senator Blunt.
    At this point, Madam Administrator, I think we can--with 
your permission--wrap it up.
    Senator Murkowski. Could I just ask----
    Senator Reed. Absolutely.
    Senator Murkowski [continuing]. Very quickly?
    Senator Reed. Madam Senator.

                    ALASKAN NATIVE VILLAGES PROGRAM

    Senator Murkowski. You know, I've been very critical of the 
EPA throughout this hearing, but I was raised by a mother who 
is very generous. And she says if there is something good to be 
said, you need to make sure that that is said, as well. And one 
of the areas where Alaskans have benefited from the EPA and 
their programs has been the Alaska Native Villages Program. 
This, of course, helps us with water and sewer infrastructure. 
We are seeing a reduction in this, in the budget area, this 
year. This is a program that is run by the State, but the 
assistance that we receive from the EPA has been extremely 
helpful.
    The question to you, Administrator Jackson, is whether or 
not the EPA has done an assessment in understanding what the 
overall needs of rural Alaska are for water and sewer 
improvements? Do you have that? Do you work with the State on 
that? We want to try to make the improvements that are 
necessary in this area. We know that the need is great, but I'm 
just wondering if an assessment has been made.
    Ms. Jackson. Yes, Senator. There's an annual inventory of 
need in Alaska. It's tracked by the Indian Health Service. As 
of November 2010, the total drinking water need in Alaska was 
413 million gallons, and the wastewater need was 300 million 
gallons. So, obviously, it totals more than 700 million 
gallons. I can tell you that, while the need is not going away, 
in 1995, when the program began, only 45 percent of the 
population had water and wastewater. In 2010, 93 percent has 
water and wastewater. It is a program that is effective, that 
is working. Forty-three percent of the need that's out there is 
still to address first-time service to homes that have no pipes 
or haul service. Forty-four percent of the needs address health 
threats that are quite substantial.
    Senator Murkowski. Well, we want to work with you on that. 
We recognize that these are tight budgets. We understand that. 
But, I think you know and appreciate, as I do, that these are 
critical infrastructure needs for the health of those 
residents. So, we will be working with you as we seek to find 
ways to advance the funding. So, I appreciate that.
    Thank you, Mr. Chairman, for the opportunity for an 
additional question.

                     ADDITIONAL COMMITTEE QUESTIONS

    Senator Reed. Thank you, Senator Murkowski.
    And let me just amplify her remarks by simply saying 
``sewers.''
    Not just in Alaska, but around. We have many things in 
common. And our concern for infrastructure is a common passion 
amongst us.
    Madam Director, we--Administrator--excuse me. We may have 
additional written questions which we will submit to you; from 
my colleagues that may not have been able to attend the 
hearing. We'd ask you to respond very quickly. And I will ask 
the staff to see if they can coordinate any written questions 
by this Friday.
    With that, Madam Administrator, thank you for your service 
and your testimony.
    Ms. Bennett, thank you, too.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]

                Questions Submitted by Senator Jack Reed

        RHODE ISLAND NARRAGANSATT BAY ESTUARY--FUNDING REDUCTION

    Question. Rhode Island is home to 1 of the Environmental protection 
Agency's (EPA) 28 national estuaries, the Narragansett Bay Estuary 
Program. These estuaries raise $15 for every $1 that the EPA provides 
them through a Federal grant. I'm concerned that the administration 
chose to reduce funding for the National Estuary Program (NEP) by 17 
percent--for a total of $27 million--despite the program's excellent 
track record of leveraging Federal investment. Your budget request 
means that every estuary will receive a $200,000 cut to its budget next 
year. That's a 25 percent cut. Can you explain why this program wasn't 
a higher priority in your budget?
    Answer. The EPA is maintaining its strong commitment to an 
effective NEP, which is a long-standing example of the EPA's commitment 
to work with communities to achieve water-quality goals on a watershed 
basis. However, given budget constraints, we had to make difficult 
decisions regarding where to pursue increases in funding and where to 
reduce funding or maintain current funding levels. The President's 
fiscal year 2012 request provides $600,000 per NEP, the same level the 
administration requested in fiscal year 2010. The EPA believes that 
this level of funding is sufficient to maintain continued positive 
momentum in the NEP.

                           STATE GRANT FUNDS

    Question. Your budget request includes a 35 percent increase for 
State and local air-quality grants and a 9 percent increase for water 
pollution control grants. These increases will fund additional staff to 
process permits more quickly and to enforce pollution limits. In 
contrast, H.R. 1 includes a $50 million cut in fiscal year 2011 for 
grants to State programs that fund air and water pollution control, 
hazardous waste financial assistance and nonpoint source prevention. 
That's a 5 percent cut. I am concerned that these cuts will have the 
exact opposite effect of your budget request and result in employee 
furloughs, slower permitting and reduced enforcement--particularly when 
States would be forced to absorb them so late in the year. What kind of 
measurable improvements do you expect your budget request to have on 
State permitting and enforcement programs? Conversely, what impact do 
you believe the cuts proposed in H.R. 1 would have on the ability of 
States to do their work this year
    Answer. I am concerned that inadequate funding for State and local 
air-quality grants could slow down the preconstruction permitting 
process for new and modified sources. A portion of the increased air 
grant funding for State and local agencies ($25 million) will support 
States as they begin to update their programs for issuing title V 
operating permits and prevention of significant deterioration permits 
to include the largest sources of greenhouse gases (GHGs). Air 
operating permit programs are usually supported by permit fees paid by 
sources of emissions. However, the new requirement to issue permits to 
the largest sources of GHGs will require additional staffing and 
training by State permitting agencies which are not initially paid by 
fees. This increase will ensure that States have the necessary trained 
and equipped staff to issue permits to sources in a timely and 
efficient manner.
    Another portion of the increase will support States' efforts to 
implement revised NAAQS and regulations to address air toxics. Under 
the previous administration, the EPA committed to review each NAAQS 
within the 5-year timeframe prescribed by the Clean Air Act. In most 
instances, the review of the latest science has resulted in the 
Administrator lowering the NAAQS to be more stringent and more 
protective of human health. As part of the implementation workload, 
States will need additional resources to conduct compliance assistance 
for regulated sources.
    At this critical time in air pollution control programs and the 
severe budget cuts within State agencies, reductions in support to 
State and local agencies will delay public health gains from improved 
air quality and negatively impact the private sector as sources are 
delayed in obtaining construction and operating permits to construct 
new facilities.
    States use the 106 State grant program to implement their water 
pollution control programs, including permitting, enforcement, water-
quality standards, Total Maximum Daily Loads, and ambient water-quality 
monitoring. States target these grant resources for water issues of the 
highest priority as identified by the States and the EPA. Over the past 
decade, the National Pollutant Discharge Elimination System (NPDES) 
universe of permitted facilities has expanded significantly from 
approximately 372,700 to an estimated 1 million. This is a result of 
industry trends and court decisions that have expended the scope of the 
NPDES Program.
    Increases are needed to address this expansion, to implement new 
NPDES regulatory requirements, and support initiatives such as the 
EPA's Clean Water Act Action Plan which seeks to revamp NPDES 
permitting, compliance, and enforcement. Under this new plan, the EPA 
is working with States to develop joint annual plans, integrate permit 
and enforcement reviews to focus on the greatest water-quality threats, 
improve transparency, and strengthen oversight to improve results and 
consistency.
    Permit issuance backlog is an issue in many States, and decreases 
in State budgets have generally exacerbated the issue. An increase in 
Federal grant funding could improve permit issuance rates, while cuts 
in funding provided from the Federal budget could worsen the problem.
    Finally, budget cuts could also result in States being unable to 
meet their program commitments, and being forced to return their 
authorized programs to the EPA. Due to resource concerns, Missouri is 
currently investigating this option, and other States could follow. 
Since Federal funding generally covers only a small percentage of the 
overall cost of running a State water pollution control program, 
operating a returned State NPDES Program would result in far higher 
costs to the Federal Government.

        DIESEL EMISSION REDUCTION ACT (DERA) FUNDING ELIMINATION

    Question. I'm concerned that the EPA's budget request eliminates 
$60 million for the DERA grant program, a program which the Congress 
reauthorized for another 5 years just last December. The administration 
has suggested that the DERA Program is no longer necessary because 
older diesel engines will eventually age out of service on their own. 
Yet the EPA's diesel emission standards do not address replacement of 
the estimated 11 million older diesel engines that are still in use. 
These engines are some of the worst producers of particulate matter and 
smog-forming compounds, and they have service lives that can last 20 to 
30 years. That's why the EPA estimates that every $1 invested in 
funding diesel retrofits yields $13 in public health benefits. Can you 
explain to us why you chose to eliminate this program? Do you really 
believe that the DERA Program has run its course?
    Answer. Since 2008, the Congress has appropriated more than $460 
million for the DERA program, including $300 million as part of the 
American Recovery and Reinvestment Act of 2009. With this funding, 
approximately 50,000 engines have been retrofitted (of the estimated 11 
million vehicles and engines in the legacy fleet), and the EPA has 
awarded:
  --$249 million in competitive grants to fund implementation of EPA- 
        or CARB-verified and certified diesel emission reduction 
        technologies;
  --$137 million in funds to participating States to implement grant 
        and loan programs for clean diesel projects;
  --$45 million in competitive grants through the SmartWay finance 
        program to establish national low-cost revolving loans or other 
        financing programs that help fleets reduce diesel emissions; 
        and
  --$32 million in competitive awards through the Emerging Technologies 
        Program to foster the development and field evaluation of 
        cutting-edge technologies.
    Budget constraints for fiscal year 2012 required the EPA to make 
tough choices; clearly the cost-effective DERA Program is an example. 
While the DERA grants accelerate the pace at which dirty engines are 
retired or retrofitted, pollution emissions from the legacy fleet will 
be reduced over time without additional DERA funding as portions of the 
fleet turnover and are replaced with new engines that meet modern 
emissions standards.

              MISFUELING OF VEHICLES AND ENGINES WITH E15

    Question. The EPA recently released a decision allowing 15 percent 
ethanol to be used in model-year 2001 and newer cars. Without providing 
consumers with clear labels and lower blend alternatives, this decision 
could lead to accidental misfueling of vehicles and engines, such as 
marine vehicles. What steps is the EPA taking to implement this 
decision? How is the EPA working with the States or other parties to 
address consumer concerns regarding misfueling or lack of availability 
of lower ethanol blends?
    Answer. Last fall, concurrently with the first partial waiver 
decision for E15, the EPA issued a proposed rule to help mitigate the 
potential for misfueling of vehicles, engines and equipment (including 
boats and other marine vehicles) not covered by the partial waiver. The 
proposed rule called for labeling of E15 pumps and product transfer and 
survey requirements to help ensure E15 is properly labeled. The EPA 
expects to issue a final rule later this spring. The EPA has also begun 
discussions with stakeholders about establishing a public outreach and 
education campaign to accompany the introduction of E15 into the 
marketplace. The EPA recently received a petition from engine 
manufacturers and owners asking the Agency to require the continued 
availability of E10, and we are in the process of considering that 
petition.
   impact of h.r. 1 preventing the epa from issuing new cwa guidance
    Question. H.R. 1 contains language that would prevent the EPA from 
issuing new guidance to clarify which waters in the United States are 
subject to regulation under the Clean Water Act (CWA). I am concerned 
about what kind of impact this could have on the wetlands and waters we 
have in Rhode Island. Would you please explain what efforts to block 
the EPA issuing new CWA guidance actually mean in terms of public 
health and water quality?
    Answer. H.R. 1 would have prohibited the EPA from implementing, 
administering, or enforcing new guidance or a new rule intended to 
clarify the definition of ``waters of the US,'' after Supreme Court 
decisions in SWANCC and Rapanos. The practical effect of the rider 
would be to prevent EPA from taking administrative steps to improve 
protections for the Nation's streams, lakes, wetlands, and other 
waters. H.R. 1, if enacted, would have prevented the EPA from taking 
actions to better protect all of our Nation's waters from chemical 
wastes, sewage, animal wastes, oil spills, and a variety of other 
contaminants. The result would be continued ambiguity regarding the 
scope of waters regulated by CWA programs, which has increased workload 
for field staff and contributed to uncertainty and delay for permit 
applicants.
    Efforts to block the EPA from clarifying waters of the United 
States subject to the CWA could have negative effects on public health. 
People use our Nation's waters for recreation, including activities 
that put them in direct contact with the water, such as swimming, 
waterskiing, jetskiing, and kayaking. Protecting smaller, upstream 
waters protects larger downstream waters. However, under current 
guidance interpreting the Supreme Court decisions, waters that flow for 
only part of the year (intermittent and ephemeral streams), many 
headwater streams, wetlands adjacent to these streams, and 
geographically isolated wetlands are difficult to protect.
    At least 117 million Americans--more than one-third of the U.S. 
population--receive their drinking water from public systems fed at 
least in part by waters that currently lack clear protection from 
pollution and destruction.\1\ In Rhode Island, almost 565,000 people 
receive drinking water from public drinking water systems that rely at 
least in part on these intermittent, ephemeral, or headwater 
streams.\2\
---------------------------------------------------------------------------
    \1\ U.S. EPA, July 2009. ``Geographic Information Systems Analysis 
of the Surface Drinking Water Provided by Intermittent, Ephemeral and 
Headwater Streams in the U.S.'' Available at: http://water.epa.gov/
lawsregs/guidance/wetlands/surface_drinking_water_index.cfm
    \2\ U.S. EPA, July 2009. ``Geographic Information Systems Analysis 
of the Surface Drinking Water Provided by Intermittent, Ephemeral and 
Headwater Streams in the U.S.'' Available at: http://water.epa.gov/
lawsregs/guidance/wetlands/upload/2009_12_28_wetlands_science_ 
surface_drinking_water_surface_drinking_water_results_state.pdf
---------------------------------------------------------------------------
    Wetlands absorb flood waters and mitigate the impacts of flooding. 
Filling of unprotected wetlands can lead to increases in the frequency 
and magnitude of ``downstream'' flooding.
    Water quality in larger downstream rivers, lakes, and coastal 
waters depends in large part on water quality in the many small streams 
and on wetlands that filter out pollution and improve water quality 
before it reaches downstream waters. In addition, small streams and 
wetlands provide habitat, food, spawning sites, and nursery areas for a 
wide variety of plants, fish, amphibians, birds, and mammals.
                                 ______
                                 
            Questions Submitted by Senator Patrick J. Leahy

                             LAKE CHAMPLAIN

    Question. The Environmental Protection Agency (EPA) has been a very 
strong partner in the clean-up of Lake Champlain for the past 20 years. 
The EPA's interest in Lake Champlain seems stronger than ever, 
especially given the Agency's move earlier this year to require a new 
Phosphorus Total Maximum Daily Load Plan, likely to be written by the 
EPA. Given the EPA's long-standing commitment then, I was disappointed 
to see the President's budget proposal cut Lake Champlain funding by 65 
percent from the fiscal year 2010 level. The proposed funding level for 
Lake Champlain is especially hard to understand when in your testimony 
you highlight the continued efforts to clean up America's great water 
bodies and you propose increasing the Chesapeake Bay funding by 35 
percent. Both the Bay and Lake Champlain watersheds face similar water-
quality issues as they seek to reduce nutrient and sediment pollution 
in important ecosystems that span multiple States. Yet it appears the 
Champlain basin is asked to do more with far less. How does the EPA 
intend to fulfill its 20-year commitment to the Lake Champlain program 
at such a reduced funding level?
    Answer. The EPA is maintaining its commitment to the Lake Champlain 
Program. We believe that this level of funding is sufficient to 
continue forward momentum in the implementation of the Lake Champlain 
Basin Management Plan, ``Opportunities for Action.'' For example, in 
fiscal year 2012, this funding will enable the EPA to continue to work 
with its partners to continue monitoring of phosphorus and other water-
quality parameters in the lake and tributaries, and to work with 
partners to implement projects that will help reduce phosphorus loads 
from all categories of sources (point, urban, and agricultural 
nonpoint).

                               SUPERFUND

    Question. The Superfund Program, while creating a wonderful legacy, 
is often criticized for its slow clean-up pace. At an estimated 62 
percent of listed Superfund sites, half or more of the job remains 
undone. In Vermont, we have four sites still awaiting final cleanup. 
How do you propose to tackle the ongoing cleanups and take on new 
sites, especially in light of budget cuts while you face cleaning up 
increasingly larger and more expensive sites?
    Answer. To manage the EPA's clean-up programs more effectively and 
efficiently, seeking to maximize the efficiency of the resources 
available, the Agency has initiated a multi-year effort to integrate 
and leverage our land clean-up authorities to address a greater number 
of contaminated sites, accelerate cleanups where possible, and put 
sites back into productive use while protecting human health and the 
environment. One of the principal elements of the Integrated Cleanup 
Initiative is to increase the project management focus and manage 
projects to completion.
    Cleanup of Superfund sites, typically the Nation's most 
contaminated, presents significant challenges. Sites on the National 
Priorities List (NPL) include, but are not limited to, contaminated 
sediment sites that may cover miles of river bed or harbor bottoms; 
mining sites with tailings piles causing acid mine drainage; landfills; 
and abandoned factories, mills, smelters, and other industrial 
facilities associated with wide-spread contamination. Often this 
contamination is found both on the surface and subsurface of a site, 
and frequently includes the contamination of groundwater. As a result, 
cleanup is often complex and frequently takes many years to complete.
    Before the EPA may initiate the on-site clean-up work, studies must 
take place to determine appropriate remedies. Once studies are 
complete, the remedies must be constructed or designed. Then the 
physical on-site construction work begins. All of this work takes place 
while the EPA works to ensure appropriate input from States, tribes, 
and local communities. Despite these challenges, the EPA has made 
substantial progress--67 percent of NPL sites (more than 1,060 sites) 
have completed on-site construction--but the EPA recognizes that more 
needs to be done.
    In times of fiscal constraints, the EPA will endeavor to prioritize 
its activities within the Superfund Program. For example, certain new 
construction projects may be delayed at sites where the contamination 
is determined to be relatively stable and the potential for human 
exposures are low. However, the public should be assured that the EPA 
will continue to take emergency actions should an immediate threat to 
human health or the environment be identified.
    Question. Has the expiration of the industry taxes affected the 
EPA's ability to move cleanups forward?
    Answer. The EPA continues to make progress cleaning up Superfund 
sites through a combination of annual Congressional appropriations, 
responsible party settlement funding, and State cost share 
contributions. The level of funding appropriated by the Congress 
annually for the Superfund Program is funded through the Superfund 
trust fund as supplemented by general revenues as necessary. 
Historically, Superfund Program appropriation levels have not been 
contingent on the trust fund balance due to the supplementation from 
general revenues. However, the revenues from the Superfund taxes will 
provide a stable, dedicated source of revenue and decrease the burden 
on individual taxpayers to foot the bill for the cleanup of sites where 
no viable party has been identified.
    Question. Have budget shortfalls for Superfund hindered your 
enforcement for efforts, leading responsible parties to drag their feet 
in negotiations in order to get a better deal, knowing that you do not 
have the funds to conduct a cleanup?
    Answer. The enforcement tools available to the EPA to compel 
responsible parties to pay for or conduct cleanup are strong and do not 
change. Responsible parties are aware that if they ``drag their feet'' 
during negotiations, the EPA has the authority to issue enforcement 
orders unilaterally. Responsible parties are also aware that if they do 
not comply with a unilateral order, the EPA may bring an action to 
enforce the order or to conduct the cleanup and recover its clean-up 
costs as well as seek treble damages. The level of funding for 
enforcement proposed in the fiscal year 2012 budget ensures that the 
EPA will have sufficient funds so that, if responsible parties fail to 
perform their clean-up obligations, the EPA can use all available tools 
to ensure that contaminated sites are cleaned up to protect human 
health and the environment.

                         FORMALDEHYDE STANDARDS

    Question. As your agency implements the Formaldehyde Standards for 
Composite Wood Products Act, that passed both the House and Senate with 
overwhelming bipartisan support and was signed into law by President 
Obama last July, I urge you to carefully consider the implications for 
small manufacturers of low-risk-engineered veneer and similar product 
components. I am very concerned that if our small niche market 
companies that produce smaller hardwood products, like guitar bodies 
and gun stocks, that pose little if any health risks based on end usage 
are held to the same standards as those items which were involved in 
the original focus of this legislation it will have a crippling effect 
on these companies.
    Can you assure me that the EPA will take into account if these 
regulations will be overly burdensome and costly to these 
manufacturers? Or if it would have devastating financial impacts on 
these companies?
    Answer. The Formaldehyde Standards for Composite Wood Products Act, 
enacted by the Congress in 2010, establishes formaldehyde emissions 
standards for hardwood plywood, particleboard, and medium-density 
fiberboard. As directed by the act, the EPA is evaluating all available 
and relevant information from State authorities, industry, and other 
available sources to determine whether the definition of the term 
``hardwood plywood'' should exempt engineered veneer or any laminated 
product. The EPA intends to address these products in its rulemaking in 
a way that is protective of human health and the environment, taking 
into account the concerns of manufacturers, particularly small business 
manufacturers.
    In addition, the Regulatory Flexibility Act, as amended by the 
Small Business Regulatory Enforcement Fairness Act (SBREFA), requires 
the EPA to estimate the number of small entities affected by a rule and 
assess the impacts on those entities. As part of developing the 
proposed rule to implement the Formaldehyde Standards for Composite 
Wood Products Act, the EPA convened a Small Business Advocacy Review 
(SBAR) Panel on February 3, 2011. The Panel is made up of 
representatives from the agency conducting the rulemaking (the EPA in 
this case), the Small Business Administration, and the Office of 
Management and Budget. The SBREFA further requires the Panel to solicit 
the advice and recommendations of Small Entity Representatives (SERs). 
Outreach meetings on this rulemaking were held with the Panel and the 
SERs on January 6, 2011, and February 17, 2011. The Panel also 
solicited two rounds of written comments from the SERs. The EPA is 
currently reviewing the comments received during the SBAR Panel 
process.
    Additional analysis is required for regulations that impose more 
than a certain level of costs on society or raise novel policy or legal 
issues. For example, the Unfunded Mandates Reform Act requires, among 
other things, a cost-benefit analysis and consideration of a reasonable 
number of regulatory options for regulations that require the 
expenditures of funds by State, local, or tribal governments in the 
aggregate, or by the private sector, of $100 million or more in any one 
year. Executive Order 12866 gives the Office of Management and Budget 
the authority to review regulatory actions that are categorized as 
significant, including rules that may have an annual effect on the 
economy of $100 million or more. Although the EPA has not yet 
determined the total costs that will be imposed by the formaldehyde 
implementing regulations, the EPA is planning to prepare an economic 
analysis that complies with the applicable requirements of the 
Executive order.
    The EPA has already received a great deal of input from 
stakeholders, including small businesses, and will continue to do so as 
we develop the implementing regulations. Pursuant to the Administrative 
Procedures Act,\1\ the EPA typically provides at least 60 days for the 
public to comment on proposed rules. The EPA is particularly interested 
in information on the effects of potential regulatory options on small 
businesses and on how the EPA can reduce the regulatory burden on small 
businesses while fulfilling its statutory mandates and its mission to 
protect human health and the environment.
---------------------------------------------------------------------------
    \1\  The Administrative Procedures Act governs the process by which 
Federal agencies develop and issue regulations, establishes 
requirements for publishing notices of proposed and final rulemaking in 
the Federal Register, and provides opportunities for the public to 
comment on notices of proposed rulemaking.
---------------------------------------------------------------------------
                                 ______
                                 
               Questions Submitted by Senator Ben Nelson

                        COMBINED SEWER MANDATES

    Question. Administrator Jackson, like many cities in the United 
States, Omaha has a combined sewer system that was originally designed 
to carry both storm water and sewage into the Missouri River and 
Papillion Creek. That system is from the 1800s and we can all agree it 
makes sense to upgrade this infrastructure and protect water quality 
for citizens in Omaha. The reality though, is that it is going to cost 
ratepayers more than $1.6 billion to meet the Environmental Protection 
Agency's (EPA) combined sewer overflow (CSO) mandate. This will result 
in a doubling of sewer fees over the next 15 years. Now I believe 
States and localities have to be responsible for some costs, but in 
cases like this when we're talking about enormous sums of money, I 
think the Federal Government should be a partner when it is mandating 
the upgrades. So my question is, how can the EPA be a partner in the 
case of combined sewer mandates? Outside of the revolving loan funds, 
which are something but far too small for projects like this, what 
tools can the EPA make available to help cities comply with the 
mandates it sets forth?
    Answer. The Clean Water State Revolving Fund (SRF) is an important 
Federal component that is helping to improve wastewater infrastructure 
across the country. The President's fiscal year 2012 budget request 
continues this administration's historic commitment to funding 
wastewater infrastructure and brings the 4-year total for the SRFs to 
approximately $16 billion (fiscal year 2009-fiscal year 2012).
    The EPA also promotes the use of green infrastructure for CSO 
mitigation. Green infrastructure reduces the volume of stormwater 
entering combined sewer systems while simultaneously improving air 
quality, reducing urban heat island effects and energy use, mitigating 
climate change and its impacts, and fostering community redevelopment 
by improving urban aesthetics. These multiple benefits can make green 
infrastructure a cost-efficient method of upgrading combined sewer 
systems but also, importantly, make it potentially eligible for a broad 
range of Federal funding. By September 2011, the EPA will provide a 
resource guide identifying Federal grant programs, (e.g., HUD, DOT) for 
which green infrastructure projects may qualify for consideration along 
with case studies, where available, of how these grant funds have been 
applied to green infrastructure projects.

                FEDERAL NUMERIC NUTRIENT CRITERIA (NNC)

    Question. Administrator Jackson, last November, the EPA finalized 
Federal NNC for Florida's flowing waters and lakes. While few dispute 
the need to reduce nutrients in Florida's waters, the EPA's proposal 
has raised questions about the data underlying the proposal, the 
potential costs of complying with numeric standards when they are 
incorporated into discharge permit limitations, and disputes over 
administrative flexibility. The concern I have is the EPA's actions in 
Florida, will be a precedent for similar regulatory action elsewhere. 
For example, environmental advocacy groups have petitioned or filed 
lawsuits seeking to require the EPA to establish numeric nutrient 
water-quality standards in Kansas and for the upper Mississippi River 
basin. For Nebraska, this could require the EPA to establish standards 
for discharge from hog and cattle feeding operations, or any point 
source from livestock feeding, but it isn't clear that the means to 
comply currently exist. I know you have stated several times that the 
EPA does not intend to apply numeric standards to other States, but 
with the petitions and lawsuits that are out there; what steps are you 
taking to insure this will not be the case?
    Answer. Nitrogen and phosphorus pollution is a widespread, serious 
and growing problem. This pollution threatens our waters used for 
drinking, fishing, swimming, and other recreational purposes. It can 
hurt the tourism industry, decimate people's home and property values, 
and cause illnesses. At this time, the EPA is not working on any 
Federal standards for phosphorus and nitrogen for any States other than 
ongoing efforts in Florida, but we are ready to provide support and 
technical assistance as States work to tackle this serious water 
pollution problem. To help States address this pollution, on March 16, 
2011, the EPA sent a memorandum to our regions that builds on our 
commitment to build partnerships with States and collaboration with 
stakeholders on this issue. The EPA will use this memorandum as the 
basis for discussions with interested and willing States about how to 
move forward on tackling this issue recognizing that there is no one-
size-fits-all solution. The EPA strongly believes States should address 
phosphorus and nitrogen pollution through standards they develop and 
supports these critical State efforts.

                   Environmental Protection Agency,
                                           Office of Water,
                                    Washington, DC, March 16, 2011.

MEMORANDUM

SUBJECT:  Working in Partnership with States to Address Phosphorus and
                Nitrogen Pollution through Use of a Framework for State 
        Nutrient
                Reductions
FROM:     Nancy K. Stoner
            Acting Assistant Administrator
TO:        Regional Administrators, Regions 1-10

    This memorandum reaffirms EPA's commitment to partnering with 
states and collaborating with stakeholders to make greater progress in 
accelerating the reduction of nitrogen and phosphorus loadings to our 
nation's waters. The memorandum synthesizes key principles that are 
guiding and that have guided Agency technical assistance and 
collaboration with states and urges the Regions to place new emphasis 
on working with states to achieve near-term reductions in nutrient 
loadings.
    Over the last 50 years, as you know, the amount of nitrogen and 
phosphorus pollution entering our waters has escalated dramatically. 
The degradation of drinking and environmental water quality associated 
with excess levels of nitrogen and phosphorus in our nation's water has 
been studied and documented extensively, including in a recent joint 
report by a Task Group of senior state and EPA water quality and 
drinking water officials and managers.\1\ As the Task Group report 
outlines, with U.S. population growth, nitrogen and phosphorus 
pollution from urban stormwater runoff, municipal wastewater 
discharges, air deposition, and agricultural livestock activities and 
row crop runoff is expected to grow as well. Nitrogen and phosphorus 
pollution has the potential to become one of the costliest and the most 
challenging environmental problems we face. A few examples of this 
trend include the following:
  --50 percent of U.S. streams have medium to high levels of nitrogen 
        and phosphorus.
  --78 percent of assessed coastal waters exhibit eutrophication.
  --Nitrate drinking water violations have doubled in eight years.
---------------------------------------------------------------------------
    \1\ An Urgent Call to Action: Report of the State-EPA Nutrients 
Innovations Task Group, August 2009.
---------------------------------------------------------------------------
  --A 2010 USGS report on nutrients in ground and surface water 
        reported that nitrates exceeded background concentrations in 64 
        percent of shallow monitoring wells in agriculture and urban 
        areas, and exceeded EPA's Maximum Contaminant Levels for 
        nitrates in 7 percent or 2,388 of sampled domestic wells.\2\
---------------------------------------------------------------------------
    \2\ Nutrients in the Nation's Streams and Groundwater: National 
Findings and Implications, US Geological Survey, 2010.
---------------------------------------------------------------------------
  --Algal blooms are steadily on the rise; related toxins have 
        potentially serious health and ecological effects.
    States, EPA and stakeholders, working in partnership, must make 
greater progress in accelerating the reduction of nitrogen and 
phosphorus loadings to our nation's waters. While EPA has a number of 
regulatory tools at its disposal, our resources can best be employed by 
catalyzing and supporting action by states that want to protect their 
waters from nitrogen and phosphorus pollution. Where states are willing 
to step forward, we can most effectively encourage progress through on-
the-ground technical assistance and dialogue with state officials and 
stakeholders, coupled with cooperative efforts with agencies like USDA 
with expertise and financial resources to spur improvement in best 
practices by agriculture and other important sectors.
    States need room to innovate and respond to local water quality 
needs, so a one-size-fits-all solution to nitrogen and phosphorus 
pollution is neither desirable nor necessary. Nonetheless, our prior 
work with states points toward a framework of key elements that state 
programs should incorporate to maximize progress. Thus, the Office of 
Water is providing the attached ``Recommended Elements of a State 
Nutrients Framework'' as a tool to guide ongoing collaboration between 
EPA Regions and states in their joint effort to make progress on 
reducing nitrogen and phosphorus pollution. I am asking that each 
Region use this framework as the basis for discussions with interested 
and willing states. The goal of these discussions should be to tailor 
the framework to particular state circumstances, taking into account 
existing tools and innovative approaches, available resources, and the 
need to engage all sectors and parties in order to achieve effective 
and sustained progress.
    While the Framework recognizes the need to provide flexibility in 
key areas, EPA believes that certain minimum building blocks are 
necessary for effective programs to manage nitrogen and phosphorus 
pollution. Of most importance is prioritizing watersheds on a state-
wide basis, setting load-reduction goals for these watersheds based on 
available water quality information, and then reducing loadings through 
a combination of strengthened permits for point-sources and reduction 
measures for nonpoint sources and other point sources of stormwater not 
designated for regulation. Our experience in almost 40 years of Clean 
Water Act implementation demonstrates that motivated states, using 
tools available under Federal and state law and relying on good science 
and local expertise, can mobilize local governments and stakeholders to 
achieve significant results.
    It has long been EPA's position that numeric nutrient criteria 
targeted at different categories of water bodies and informed by 
scientific understanding of the relationship between nutrient loadings 
and water quality impairment are ultimately necessary for effective 
state programs. Our support for numeric standards has been expressed on 
several occasions, including a June 1998 National Strategy for 
Development of Regional Nutrient Criteria, a November 2001 national 
action plan for the development and establishment of numeric nutrient 
criteria, and a May 2007 memo from the Assistant Administrator for 
Water calling for accelerated progress towards the development of 
numeric nutrient water quality standards. As explained in that memo, 
numeric standards will facilitate more effective program implementation 
and are more efficient than site-specific application of narrative 
water quality standards. We believe that a substantial body of 
scientific data, augmented by state-specific water quality information, 
can be brought to bear to develop such criteria in a technically sound 
and cost-effective manner.
    EPA's focus for nonpoint runoff of nitrogen and phosphorus 
pollution is on promoting proven land stewardship practices that 
improve water quality. EPA recognizes that the best approaches will 
entail States, Federal agencies, conservation districts, private 
landowners and other stakeholders working collaboratively to develop 
watershed-scale plans that target the most effective practices to the 
acres that need it most. In addition, our efforts promote innovative 
approaches to accelerate implementation of agricultural practices, 
including through targeted stewardship incentives, certainty agreements 
for producers that adopt a suite of practices, and nutrient credit 
trading markets. We encourage Federal and state agencies to work with 
NGOs and private sector partners to leverage resources and target those 
resources where they will yield the greatest outcomes. We should 
actively apply approaches that are succeeding in watersheds across the 
country.
    USDA and State Departments of Agriculture are vital partners in 
this effort. If we are to make real progress, it is imperative that EPA 
and USDA continue to work together but also strengthen and broaden 
partnerships at both the national and state level. The key elements to 
success in BMP implementation continue to be sound watershed and on-
farm conservation planning, sound technical assistance, appropriate and 
targeted financial assistance and effective monitoring. Important 
opportunities for collaboration include EPA monitoring support for 
USDA's Mississippi River Basin Initiative as well as broader efforts to 
use EPA section 319 funds (and other funds, as available) in 
coordination with USDA programs to engage creatively in work with 
communities and watersheds to achieve improvements in water quality.
    Accordingly the attached framework envisions that as states develop 
numeric nutrient criteria and related schedules, they will also develop 
watershed scale plans for targeting adoption of the most effective 
agricultural practices and other appropriate loading reduction measures 
in areas where they are most needed. The timetable reflected in a 
State's criteria development schedule can be a flexible one provided 
the state is making meaningful near-term reductions in nutrient 
loadings to state waters while numeric criteria are being developed.
    The attached framework is offered as a planning tool, intended to 
initiate conversation with states, tribes, other partners and 
stakeholders on how best to proceed to achieve near- and long-term 
reductions in nitrogen and phosphorus pollution in our nation's waters. 
We hope that the framework will encourage development and 
implementation of effective state strategies for managing nitrogen and 
phosphorus pollution. EPA will support states that follow the framework 
but, at the same time, will retain all its authorities under the Clean 
Water Act.
    With your hard work, in partnership with the states, USDA and other 
partners and stakeholders, I am confident we can make meaningful and 
measurable near-term reductions in nitrogen and phosphorus pollution. 
As part of an ongoing collaborative process, I look forward to 
receiving feedback from each Region, interested states and tribes, and 
stakeholders.

    Attachment

Cc:  Directors, State Water Programs
     Directors, Great Water Body Programs
     Directors, Authorized Tribal Water Quality Standards Programs 
        Interstate
         Water Pollution Control Administrators
  recommended elements of a state framework for managing nitrogen and 
                          phosphorus pollution
Prioritize Watersheds on a Statewide Basis for Nitrogen and Phosphorus 
        Loading Reductions
  --Use best available information to estimate Nitrogen (N) & 
        Phosphorus (P) loadings delivered to rivers, streams, lakes, 
        reservoirs, etc. in all major watersheds across the state on a 
        Hydrologic Unit Code (HUC) 8 watershed scale or smaller 
        watershed (or a comparable basis.)
  --Identify major watersheds that individually or collectively account 
        for a substantial portion of loads (e.g. 80 percent) delivered 
        from urban and/or agriculture sources to waters in a state or 
        directly delivered to multi-jurisdictional waters.
  --Within each major watershed that has been identified as accounting 
        for the substantial portion of the load, identify targeted/
        priority sub-watersheds on a HUC 12 or similar scale to 
        implement targeted N & P load reduction activities. 
        Prioritization of sub-watersheds should reflect an evaluation 
        of receiving water problems, public and private drinking water 
        supply impacts, N & P loadings, opportunity to address high-
        risk N & P problems, or other related factors.

Set Watershed Load Reduction Goals Based Upon Best Available 
        Information
    Establish numeric goals for loading reductions for each targeted/
priority sub-watershed (HUC 12 or similar scale) that will collectively 
reduce the majority of N & P loads from the HUC 8 major watersheds. 
Goals should be based upon best available physical, chemical, 
biological, and treatment/control information from local, state, and 
Federal monitoring, guidance, and assistance activities including 
implementation of agriculture conservation practices, source water 
assessment evaluations, watershed planning activities, water quality 
assessment activities, Total Maximum Daily Loads (TMDL) implementation, 
and National Pollutant Discharge Elimination System (NPDES) permitting 
reviews.

Ensure Effectiveness of Point Source Permits in Targeted/Priority Sub-
        Watersheds for:
  --Municipal and Industrial Wastewater Treatment Facilities that 
        contribute to significant measurable N & P loadings;
  --All Concentrated Animal Feeding Operations (CAFOs) that discharge 
        or propose to discharge; and/or
  --Urban Stormwater sources that discharge into N & P-impaired waters 
        or are otherwise identified as a significant source.

Agricultural Areas
    In partnership with Federal and State Agricultural partners, NGOs, 
private sector partners, landowners, and other stakeholders, develop 
watershed-scale plans that target the most effective practices where 
they are needed most. Look for opportunities to include innovative 
approaches, such as targeted stewardship incentives, certainty 
agreements, and N & P markets, to accelerate adoption of agricultural 
conservation practices. Also, incorporate lessons learned from other 
successful agricultural initiatives in other parts of the country.

Storm Water and Septic Systems
    Identify how the State will use state, county and local government 
tools to assure N and P reductions from developed communities not 
covered by the Municipal Separate Storm Sewer Systems (MS4) program, 
including an evaluation of minimum criteria for septic systems, use of 
low impact development/green infrastructure approaches, and/or limits 
on phosphorus in detergents and lawn fertilizers.

Accountability and Verification Measures
  --Identify where and how each of the tools identified in sections 3, 
        4 and Swill be used within targeted/priority sub-watersheds to 
        assure reductions will occur.
  --Verify that load reduction practices are in place.
  --To assess/demonstrate progress in implementing and maintaining 
        management activities and achieving load reductions goals: 
        establish a baseline of existing N & P loads and current Best 
        Management Practices (BMP) implementation in each targeted/
        priority sub-watershed, conduct ongoing sampling and analysis 
        to provide regular seasonal measurements of N & P loads leaving 
        the watershed, and provide a description and confirmation of 
        the degree of additional BMP implementation and maintenance 
        activities.

Annual Public Reporting of Implementation Activities and Biannual 
        Reporting of Load Reductions and Environmental Impacts 
        Associated With Each Management Activity in Targeted Watersheds
  --Establish a process to annually report for each targeted/priority 
        sub-watershed: status, challenges, and progress toward meeting 
        N & P loading reduction goals, as well as specific activities 
        the state has implemented to reduce N & P loads such as: 
        reducing identified practices that result in excess N & P 
        runoff and documenting and verifying implementation and 
        maintenance of source-specific best management practices.
  --Share annual report publically on the state's website with request 
        for comments and feedback for an adaptive management approach 
        to improve implementation, strengthen collaborative local, 
        county, state, and Federal partnerships, and identify 
        additional opportunities for accelerating cost-effective N & P 
        load reductions.

Develop Work Plan and Schedule for Numeric Criteria Development
    Establish a work plan and phased schedule for N and P criteria 
development for classes of waters (e.g., lakes and reservoirs, or 
rivers and streams). The work plan and schedule should contain interim 
milestones including but not limited to data collection, data analysis, 
criteria proposal, and criteria adoption consistent with the Clean 
Water Act. A reasonable timetable would include developing numeric N 
and P criteria for at least one class of waters within the state (e.g., 
lakes and reservoirs, or rivers and streams) within 3-5 years 
(reflecting water quality and permit review cycles), and completion of 
criteria development in accordance with a robust, state-specific 
workplan and phased schedule.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran

                 SUPERFUND NATIONAL PRIORITY LIST (NPL)

    Question. I noticed that the Environmental Protection Agency (EPA) 
added 10 hazardous waste sites to the Superfund NPL, and 15 sites were 
proposed to be added to the list. Two of these proposed sites are in 
Mississippi. How long do you expect it will take for these two sites to 
be placed on the NPL? What can the communities expect from the EPA 
during this process?
    Answer. The two Mississippi sites, Red Panther and Kerr-McGee 
Columbus were proposed to the NPL on March 10, 2011. There is a 60-day 
public comment period to provide support or opposition to the inclusion 
on the NPL of any site included on the proposal. The EPA will evaluate 
these comments before making any final decision; the earliest a 
decision on either site will be made is September 2011.
    There have been a number of public meetings on these sites related 
to both removal actions and potential NPL listing. There have been 
three public meetings for the Red Panther site specifically related to 
listing, with another meeting set for this summer. There has been one 
public meeting on the Kerr-McGee site related to listing, and the EPA 
personnel involved with the site maintain frequent communications with 
the community and have a very visible on-site presence.
    The EPA works very closely with the community at all stages of the 
investigation and cleanup of sites. For example, before a remedial 
investigation begins, the EPA conducts community interviews to solicit 
people's concerns and determine how and when people want to be involved 
with the cleanup. Based on the community interviews and other relevant 
information, the EPA prepares a Community Involvement Plan that 
identifies the outreach activities the Agency expects to undertake. In 
addition, the EPA establishes an information repository and 
administrative record that will contain relevant site documents, and 
notifies the community about where to find the information. The EPA 
also informs the community about the availability of Technical 
Assistance Grants. These activities and more are designed to provide 
opportunities for the community to be involved in the site cleanup, and 
to help shape the decisions that are made about how the site will be 
addressed.

       COMMUNITY WATER SYSTEMS TRAINING AND TECHNICAL ASSISTANCE

    Question. Mississippi has approximately 850 community water 
systems. The majority are located in small rural communities with 
limited resources to comply with Federal environmental regulations, and 
are operated by part-time operators. The training and technical 
assistance funded through your agency allow these communities to 
protect their drinking water while enhancing public health. I have 
heard from hundreds of communities over the years regarding this 
assistance that has been in effect for more than 30 years and the 
positive impact on a local community's ability to have adequately 
trained personnel necessary to comply with complex EPA regulations. I 
have also been told that without this assistance, communities with 
limited means would be forced to hire outside entities for compliance, 
raise rates, or remain out of compliance. Do you believe this 
assistance is directly related to increased compliance, sustainability, 
and enhanced public health in rural America?
    Answer. The assistance provided to States via the EPA's Public 
Water System Supervision (PWSS) grant programs and the technical 
assistance ``set-asides'' of the Drinking Water State Revolving Fund 
(DWSRF) are key components for assuring that drinking water systems are 
sustainable and deliver water that meets safe standards to consumers 
For example, the Mississippi Department of Public Health utilizes their 
PWSS grant funds to provide staff engineering assistance to small water 
systems struggling to address disinfection byproducts and other 
compliance challenges. States also utilize DWSRF set-asides to fund 
circuit riders to help small systems with technical compliance issues, 
as well as fund third-party technical assistance providers to assist 
with energy and water loss audits and associated projects.
    Question. Your budget does not explicitly include any funding to 
assist small rural water systems to comply with EPA rules and 
regulations. If we adopt your budget proposal, how will you assure the 
committee that these communities will be able to provide safe and 
affordable drinking water?
    Answer. Since 1976, the EPA has annually received a Congressional 
appropriation under section 1443(a) of the Safe Drinking Water Act 
(SDWA) to assist States, territories, and tribes in carrying out their 
PWSS programs. Designated State agencies, territories, and tribes that 
have been delegated Primary Enforcement Responsibility for the PWSS 
Program are eligible to receive grants. The 2012 budget includes a 
request to again fund the PWSS programs. These grants help eligible 
States, territories, and tribes develop and implement a PWSS Program 
adequate to enforce the requirements of the SDWA and ensure that water 
systems comply with the National Primary Drinking Water Regulations. 
The EPA continues to be an active partner in the PWSS State Program to 
assist drinking water communities. Also, the EPA is upgrading the data 
management component of Safe Drinking Water Information System (SDWIS) 
that States can use during administration of their State drinking water 
programs. SDWIS/State houses information related to State inventory of 
systems, as well as required sampling and monitoring regiments. The 
modified system is expected to enable States to redirect resources to 
areas other than data management including providing increase attention 
to technical assistance needs of small systems.
    In addition, the SDWA allows States to utilize several ``set-
asides'' of their DWSRF to provide technical assistance to community 
water systems serving 10,000 or fewer persons to fund technical 
assistance initiatives. These ``set-asides'' include: small systems 
technical assistance (2 percent); administrative and technical 
assistance (4 percent); State program management (10 percent); and 
local assistance and other State programs (15 percent). Activities paid 
for with these funds include project planning, circuit riders, and 
special small system training. States use ``set-aside'' funds to 
provide technical assistance and training to help small systems build 
the capacity they need to comply with current and future drinking water 
rules.
                                 ______
                                 
              Questions Submitted by Senator Susan Collins

                      WATER INFRASTRUCTURE FUNDING

    Question. The Environmental Protection Agency (EPA) is proposing to 
cut $960 million from the fiscal year 2010 level for the Clean Water 
and Drinking Water State Revolving Funds. Even with the extra infusion 
of funds we have seen in recent years, Maine, like many other States, 
faces ongoing need for water infrastructure funding and significant 
budget pressures. Waste management experts estimate that the capital 
need for repair and replacement projects in Maine over the next 5 years 
will cost at least 10 times the amount that the State was allocated in 
fiscal year 2010. Given that already overburdened municipalities are 
attempting to satisfy the EPA wastewater and drinking water mandates, 
how can we work to ensure adequate funding is available for States to 
meet such requirements?
    Answer. The President's fiscal year 2012 budget request maintains 
this administration's historic commitment to funding drinking water and 
wastewater infrastructure across the country. As part of the 
administration's long-term strategy, the EPA is implementing a 
Sustainable Water Infrastructure Policy that focuses on working with 
States and communities to enhance technical, managerial, and financial 
capacity. Important to the technical capacity will be enhancing 
alternatives analysis to expand ``green infrastructure'' options and 
their multiple benefits. Future year budgets for the State Revolving 
Funds (SRF) gradually adjust, taking into account repayments, through 
2016 with the goal of providing, on average, about 5 percent of water 
infrastructure spending annually. When coupled with increasing 
repayments from loans made in past years by States, the annual funding 
will allow the SRFs to finance a significant percentage in clean water 
and drinking water infrastructure. Federal dollars provided through the 
SRFs will act as a catalyst for efficient system-wide planning and 
ongoing management of sustainable water infrastructure. Overall, the 
administration requests a combined $2.5 billion for the SRFs. This 
request brings the 4-year total for SRFs to approximately $16 billion 
(fiscal year 2009-fiscal year 2012, including American Recovery and 
Reinvestment Act funds. These historic levels of funding demonstrate an 
unprecedented level of support for these programs and the communities 
that depend on them to help finance their water infrastructure needs.

               EMISSION STANDARDS FOR HEAVY-DUTY VEHICLES

    Question. As the EPA works with the National Highway Traffic Safety 
Administration (NHTSA) to implement the program to improve fuel economy 
for cars and trucks, I am interested in learning more about the EPA's 
plans to issue new regulations to curtail the emissions of certain 
heavy-duty vehicles.
    Agriculture and forest products businesses in Maine rely on heavy-
duty trucks to receive raw materials and ship products more 
economically, thus helping to preserve and create jobs. I support 
helping to produce a new generation of clean vehicles to lower our 
dependence on foreign oil and cut down on pollution, and have worked on 
legislation to advance the research and development of heavy-duty 
hybrid technology for trucks and to curb emissions by keeping the 
heaviest trucks on Federal interstates, rather than diverting them to 
local secondary roads and downtowns.
    Can you discuss how the EPA intends to use the $4 million it is 
requesting for fiscal year 2012, and detail what steps the EPA plans to 
take to work with industry and NHTSA in developing emissions for heavy-
duty vehicles, which play such an integral role in our economy?
    Answer. The EPA and the Department of Transportation's ongoing 
heavy-duty greenhouse gas (GHG) and fuel-economy rule has received 
unprecedented support from the trucking industry, including engine and 
truck manufacturers, trucking associations, and others. We have worked 
closely with industry and other stakeholders throughout the standards 
proposal process, including holding two public hearings in fall 2010. 
We are also continuing to meet with the regulated industry to make sure 
we have fully understood their comments. We are confident that the 
final action will be one that both improves trucking efficiency overall 
and maintains the full and broad functionality of trucking in our 
economy.
    In support of the heavy-duty GHG Program, the EPA will have 
significant implementation needs to facilitate the success of the 
program. This includes the development of new testing capabilities, new 
IT structures, and the development of additional models and test 
protocols to ensure compliance. Unlike the light-duty sector we do not 
have existing protocols, test procedures, and baseline models for the 
heavy-duty sector. Putting this infrastructure into place will take 2 
to 3 years, and with program implementation beginning in early fiscal 
year 2014, fiscal year 2012 will be a critical year for these heavy-
duty GHG activities.

                         EMERGENCY PREPAREDNESS

    Question. We have all watched in horror over the last week as the 
disaster in Japan continues to unfold. Our hearts obviously go out to 
all those who are suffering amid that country's worst crisis since 
World War II. Here at home, I think many people were surprised this 
week to awake to news reports that the nuclear crisis in Japan could 
lead to radiation clouds that travel with the jet stream and make their 
way to the Western United States.
    Administrator Jackson, I note the EPA is requesting $38.7 million 
in fiscal year 2012 for homeland security functions related to 
emergency response in the event of an incident involving harmful 
chemical, biological, and radiological substances. Can you elaborate on 
the status of plans for interagency coordination should such an event 
or test occur here in the United States?
    Answer. The Nuclear/Radiological Incident Annex to the National 
Response Framework (NRF) describes the policies, situations, concepts 
of operations, and responsibilities of the Federal departments and 
agencies governing the immediate response and short-term recovery 
activities for incidents involving release of radioactive materials to 
address the consequences of the event. Domestic incidents may occur on 
Federal-owned or licensed facilities, privately owned property, urban 
centers, or other areas and may vary in severity from the small to the 
catastrophic. Coordinating agencies provide leadership, expertise, and 
authorities to implement critical aspects of the response in accordance 
with authorities and capabilities. The EPA serves as a coordinating 
agency for environmental response and cleanup for incidents other than 
those involving the Departments of Defense and Energy, NASA and NRC 
facilities or assets. The EPA may serve as a cooperating agency in 
support of any domestic nuclear incident. Incidents are generally 
managed at the lowest possible level and will adapt to meet 
requirements under the NRF.
    The EPA's primary capabilities to support a domestic nuclear 
incident include:
  --Integration into the Federal Radiological Monitoring and Assessment 
        Center as well as participation in the Advisory Team for 
        Environment, Food, and Health.
  --Resources, including personnel, detection equipment, sample 
        collection and laboratory analysis support for site 
        characterization and defining the extent of contamination.
  --Providing nationwide environmental monitoring data from the RadNet 
        for assessing the national impact of the incident.
  --Expertise and support on use of data from initial assessments and 
        extent of contamination efforts for guidance on health and 
        safety recommendations of response personnel and for use by 
        decisionmakers to prioritize areas of decontamination.
  --Application of its extensive experience in addressing hazardous 
        waste sites to support the cleanup of the contaminated area.
    Question. How would the EPA work with other Federal agencies to get 
messages out to the general public? What is your interaction with the 
Department of Homeland Security (DHS) on general public messaging pre 
and postdisaster?
    Answer. As part of the DHS' responsibility to coordinate incident 
management under Homeland Security Presidential Directive 5, the NRF 
Incident Communications Emergency Policy and Procedures (ICEPP) 
provides detailed guidance to Federal incident communicators on 
activities to be initiated in conjunction with incidents requiring a 
coordinated Federal response. It is applicable to all Federal 
departments and agencies responding under the NRF. It establishes 
mechanisms to prepare and deliver coordinated and sustained messages 
regarding incidents requiring a coordinated Federal response, and 
provides for prompt Federal acknowledgement of an incident and 
communication of emergency information to the public during incident 
management operations.
    The ICEPP is comprised of two annexes contained in the NRF:
  --Public Affairs Support Annex.--Describes the interagency policies 
        and procedures for incident communications with the public.
  --ESF #15--External Affairs Annex.--Outlines the functions, 
        resources, and capabilities for external affairs.
  --As part of the response under ESF #15, DHS sets up conference lines 
        to initiate and coordinate messages across levels of 
        government.
  --The National Incident Communication Conference Line is a channel 
        for coordination across Federal agencies and may include 
        affected States, as appropriate.
  --The State Incident Communication Conference Line is a channel for 
        the Federal agencies to coordinate directly with the State and 
        local communicators.
  --The Private Sector Incident Communications Conference Line is a 
        channel for Federal agencies to coordinate with the private 
        sector.
    Assembled by the Federal Emergency Management Agency's Chemical, 
Biological, Radiological, Nuclear and Explosives Branch, the EPA co-
leads the Nuclear/Radiological Communications Working Group. This group 
(made up of members from 10 Federal agencies and multiple State and 
local radiation and communications specialists) is a forum for 
interested parties at the Federal, State, and local level to exchange 
ideas and discuss nuclear/radiation related communications projects. 
Most recently, this group has been working on pre and postincident 
messages for nuclear detonations.
    During any domestic nuclear incident, the EPA would work with other 
departments and agencies to provide fully coordinated information to 
the public. Also, based on recent events, we know that the EPA will 
play a significant role in providing monitoring information to the 
public, primarily through the EPA Web site. For example, while the 
nuclear incident in Japan is not considered a U.S. response effort, the 
EPA has used its Web site to keep the public informed about the data 
that is continuously collected from the RadNet monitors.

                    RURAL WATER TECHNICAL ASSISTANCE

    Question. Maine has 382 community water systems. Owners and 
operators of these systems have an enormous and very important 
responsibility to provide safe drinking water. For years, Maine's small 
water systems have relied on support and technical assistance made 
possible through national funding provided by both the USDA and the EPA 
to help water system operators to understand and achieve compliance 
with increasingly complex Federal rules and regulations. In previous 
years, the Congress has set aside funding for rural water technical 
assistance within the Environmental Programs Management account of the 
EPA's budget. I was disappointed to see that the President did not 
specifically include this funding within his fiscal year 2012 request. 
With regard to both the current year and fiscal year 2012, it is 
unclear as to whether we will have the opportunity to set aside money 
within the EPM account for rural water technical assistance. My 
question is without clear direction from the Congress to direct funding 
to rural water technical assistance, will the EPA continue to make that 
investment?
    Answer. Recent Congressional appropriations have typically included 
specific funding and direction for approximately $16 million annually 
in small system technical assistance. Absent this directed funding, the 
EPA has two other avenues where systems may receive resources to 
support technical assistance needs. Since 1976, the EPA has annually 
received a Congressional appropriation under section 1443(a) of the 
Safe Drinking Water Act (SDWA) to assist States, territories, and 
tribes in carrying out their Public Water System Supervision programs. 
The 2012 budget includes a request to again fund the Public Water 
System Supervision (PWSS) programs. These grants help eligible States, 
territories, and tribes develop and implement a PWSS program adequate 
to enforce the requirements of the SDWA and ensure that water systems 
comply with the National Primary Drinking Water Regulations. The EPA 
will continue to be an active partner in the PWSS State Program to 
assist all communities, including rural ones, in providing safe 
drinking water.
    In addition, the Drinking Water State Revolving Loan Fund (DWSRF) 
provides States with the flexibility to take a variety of ``set-
asides'' from their Federal capitalization grant to fund technical 
assistance, State programs, and special assistance to water systems. 
These optional ``set-asides'' total up to 31 percent of a State's 
capitalization grant:
  --4 percent for administration of the DWSRF Program;
  --2 percent for technical assistance to systems serving 10,000 or 
        fewer persons (project planning, circuit riders, and special 
        small system training);
  --10 percent for development and implementation of State programs 
        (PWSS, source water protection, capacity development, and 
        operator certification); and
  --15 percent for local assistance (part of a capacity development 
        strategy; establishment and implementation of a wellhead 
        protection program; and loans for source water protection).
    States use set-aside funds to provide technical assistance and 
training to help small systems build the capacity they need to comply 
with current and future drinking water rules. The EPA continues to 
encourage States to carefully consider how to balance utilization of 
the available ``set-asides'' as they administer their State program and 
small system technical assistance needs.
    Question. Will the EPA provide on-site technical assistance to help 
Maine's community water systems to understand and comply with the EPA's 
complex requirements?
    Answer. The EPA will continue to encourage States to take full 
advantage of flexibility afforded them by the State PWSS Grant Program 
and the ``set-asides'' available from the SRFs to provide technical 
assistance to small communities. Specifically regarding Maine, EPA 
Region 1 New England is providing the following services to Maine water 
systems: Effective Utility Management training, system specific 
implementation plans, and on-site technical assistance to improve long-
term management and operations for six systems; funding two mutual aid 
Water/Wastewater Agency Response Network (WARN) workshops to help 
recruit more members for Maine WARN, and to facilitate a tabletop 
exercise with the objective of practicing the Maine WARN operational 
plan; revising an existing pocket guide to help small suppliers improve 
sampling techniques; developing a Maine specific document to assist 
business owners that are also public water suppliers; and initiating 
outreach efforts to educate Maine restaurants with their own pubic 
water supplies.
    Question. Do you believe you have the authority to provide this 
technical assistance?
    Answer. Provisions of the Safe Drinking Water Act section 1452 
provide authority for a national technical assistance ``set-aside'', as 
well as several ``set-asides'' available to States of their Federal 
capitalization grant to provide technical assistance or to fund 
technical assistance initiatives to community water systems serving 
10,000 or fewer persons.

                           REGULATORY REVIEW

    Question. Earlier this year the administration announced a 
government-wide search for outdated and inefficient regulations that 
make our country less competitive. I am interested in understanding 
what this will mean in practice as during the past 2 years, the 
administration's track record has been one of imposing costly new 
burdens and red tape on employers. We saw an example of this last 
spring when the EPA did not provide enough time and training 
opportunities to allow small businesses to comply with lead paint 
abatement rules in order to avoid steep fines. Maine's forest products 
industry is facing steep costs associated with the EPA's Boiler MACT 
rules. Can you give me an update on how the EPA is undertaking its 
regulatory review? Will you immediately take action to alter or 
eliminate outdated and inefficient regulations as they are identified? 
What does this review mean for regulations that are currently in the 
pipeline?
    Answer. On January 18, 2011, President Obama issued Executive Order 
13563 outlining his regulatory strategy to support continued economic 
growth and job creation, while protecting the safety, health, and 
rights of all Americans. This Executive order presents the EPA with an 
opportunity to look at our regulatory program to ensure that it 
accomplishes the Agency's mission to protect human health and to 
safeguard the natural environment while being mindful of the impact on 
continued economic growth and job creation.
    The Executive order requires that all agencies develop and submit 
to the Office of Management and Budget (OMB), by May 18, 2011, a 
preliminary plan to periodically review existing significant 
regulations to determine whether any should be modified, streamlined, 
expanded, or repealed. The EPA takes this directive from the President 
very seriously and we engaged in several outreach efforts throughout 
the country to solicit public feedback on how we can improve our 
regulatory programs and process. One of the characteristics we seek to 
emphasize in our retrospective review is transparency of the review 
process itself. The EPA is committed to ensuring that its rulemaking 
procedures, including retrospective reviews, are open and accessible to 
the public so that interested citizens and stakeholders can be informed 
about and participate in the Agency's decisionmaking processes.
    In response to the release of the Executive order, the EPA 
immediately began working to implement the provisions of the Executive 
order. On February 18, 2011, the EPA launched its Improving Regulations 
Web site (www.epa.gov/improvingregulations). On February 22, 2011, the 
EPA opened 15 public dockets to receive comments, and on February 23, 
2011, the Agency published a Federal Register notice soliciting public 
comments over the next 30 days. The EPA advertised and hosted a 
national meeting on March 14, 2011 in Arlington, Virginia, to solicit 
public comment on how we should design our plan for retrospective 
review and how we should conduct our periodic reviews. Moreover, each 
EPA regional office held one or more listening sessions for the public 
and key stakeholders. A schedule of the listening sessions was posted 
in advance on our Improving Regulations Web site. When we heard from 
the public that they needed more time to comment on the plan, we 
immediately responded to the concern by extending the public comment 
period from March 20 to April 4, 2011, and published another Federal 
Register Notice to announce the extension.
    To date, we have received more than 200 written comments submitted 
to our public dockets, in addition to the input received at 19 separate 
public meetings and listening sessions the EPA convened in responses to 
the Executive order. The EPA is now working hard to read and digest all 
the public input, which ranged from targeted suggestions on regulatory 
text in particular rules to broad suggestions on how the Agency should 
design its plans for periodic retrospective reviews. In that latter 
category, we heard some specific ideas for improving our regulatory 
process that we are taking to heart and will work to make more routine 
in our rule-writing procedures:
  --provide more opportunities for public dialogue on the EPA 
        rulemakings;
  --increase coordination across Federal agencies and within the EPA on 
        rulemaking activities; and
  --ensure consistency when enforcing regulations.
    The EPA is working hard to meet the deadline in the Executive order 
of delivering a preliminary plan for retrospective review to OMB by May 
18, 2011. The plan will include both a list of rules for review in the 
near term and a roadmap on how the EPA will carry out the periodic 
reviews going forward which are called for by the Executive order. As 
the EPA moves forward to review the rules identified in the plan, we 
will do so in a way in keeping with the transparent and participatory 
process we have used thus far. With regard to rules currently in the 
pipeline, as will be noted in our plan, many of these are pursuant to 
ongoing reviews and we will continue to develop our rules in a manner 
that is consistent with our statutory obligations, the criteria laid 
out by the President, and our commitment to protect America's health 
and revitalize the economy.

                      INSPECTOR GENERAL REFORM ACT

    Question. In October 2008, the Inspector General Reform Act, which 
I co-authored with Senators McCaskill and Lieberman, was enacted. The 
law enhances Inspector General (IG) independence to help empower and 
facilitate the important work of Inspectors General. The law requires 
that the President's budget request include comments from the agency's 
IG when the IG believes that the budget request for its office will 
``substantially inhibit'' the IG's ability to carry out its oversight 
responsibilities. This year the EPA IG was the only IG who submitted 
comments under this authority. Specifically, the EPA IG stated that, 
despite an increase of $1.24 million from the fiscal year 2010 enacted 
budget, the amount in the President's fiscal year 2012 budget request 
is approximately $5 million below the amount he believes is necessary 
to carry out the work of his office. The EPA IG argues that these 
additional funds are critical, in particular, to carry out work related 
to cyber security investigations and homeland security oversight that 
the EPA has taken on. In recent years, the EPA IG office has funded 
these activities through a reallocation of existing resources, but 
``cannot continue to do so without creating accountability and risk 
vulnerability gaps in its oversight of other Agency programs and 
operations.''
    Why did you not take these concerns into account when developing 
your budget request?
    Answer. The EPA took the IG's concern on cyber security into 
account in developing the fiscal year 2012 budget request while also 
considering other Agency priorities. In response to this identified 
need, an increase is provided in the IG's budget although overall 
funding for the EPA is down 13 percent below fiscal year 2010 enacted 
levels.
    Question. Do you think that the IG has made errors in calculating 
the amounts needed to continue these additional new oversight 
responsibilities in the IG office? Do you think that these additional 
oversight responsibilities do not warrant sufficient funding?
    Answer. In developing the fiscal year 2012 budget, the EPA had to 
make hard choices for all programs at the reduced budget level yet 
recognized the need for funding to support the IG's oversight of cyber 
security activities. As a result, a level of increase was provided 
that, combined with the available resources the OIG has in their 
budget, would allow OIG to continue carrying out this work that the IG 
has initiated within available resources.
                                 ______
                                 
             Questions Submitted by Senator Lisa Murkowski

                    BRISTOL BAY WATERSHED ASSESSMENT

    Question. The Environmental Protection Agency (EPA) was petitioned 
to pre-emptively veto development in the Bristol Bay area of Alaska, 
and responded by undertaking a so-called ``watershed assessment'' of 
the area. Such an assessment appears to be unprecedented--as I had 
observed in a letter to you, dated February 16 of this year--though I 
am open to reviewing all of the information your agency is gathering as 
part of that process. On February 10, members of my staff also 
participated in a meeting with EPA officials, at which your staff 
committed to provide examples of precedents for watershed assessments, 
or at least examples of similar activities by the agency. To date, I 
have not received that information.
    Can you provide a description of prior assessments here today, or 
materials--for the record--that speak to the statutory authorities 
under which this watershed assessment is being conducted and copies of 
some examples of their past use?
    Answer. The EPA's Bristol Bay assessment, focusing primarily on the 
Kvichak and Nushagak watersheds, will characterize the risks of large-
scale development on the Bay's water quality and salmon fishery, and 
evaluate options to protect the watersheds and ensure the 
sustainability of the fishery. The EPA is conducting this assessment 
under our Clean Water Act (CWA) section 104 authorities described 
below.
    The objective of the CWA is to restore and maintain the chemical, 
physical, and biological integrity of the Nation's waters. In 
furtherance of that objective, CWA section 104(a) directs the EPA to 
establish national programs for the prevention, reduction, and 
elimination of pollution and as part of such programs directs the EPA 
to:

    ``(1) in cooperation with other Federal, State, and local agencies, 
conduct and promote the coordination and acceleration of, research, 
investigations, experiments, training, demonstrations, surveys, and 
studies relating to the causes, effects, extent, prevention, reduction, 
and elimination of pollution;
    ``(2) encourage, cooperate with, and render technical services to 
pollution control agencies and other appropriate public or private 
agencies, institutions, and organizations, and individuals, including 
the general public, in the conduct of activities referred to in 
paragraph (1) of this subsection;
    ``(3) conduct, in cooperation with State water pollution agencies 
and other interested agencies, organizations and persons, public 
investigations concerning the pollution of any navigable waters, and 
report on the results of such investigations . . .''

    Section 104(b) further states that in carrying out these 
provisions, the EPA's Administrator is authorized to:

    ``(1) collect and make available, through publications and other 
appropriate means, the results of and other information, including 
appropriate recommendations by [her] him in connection therewith, 
pertaining to such research and other activities referred to in 
paragraph (1) of subsection (a);
    ``(2) cooperate with other Federal departments and agencies, State 
water pollution control agencies, interstate agencies, other public and 
private agencies, institutions, organizations, industries involved, and 
individuals, in the preparation and conduct of such research and other 
activities referred to in paragraph (1) of subsection (a) . . .''

    The mission of the EPA is to protect human health and the 
environment. As such, evaluating the environmental impacts of different 
actions is a central role and function of the agency. The EPA has 
conducted environmental assessments that evaluate the impacts of past 
actions or estimate the potential impacts of future actions. Below is a 
list of several recent examples of such assessments. This information 
can also be found in our March 21, 2011, response to your February 16, 
2011, letter. (Please note that some of these assessments are currently 
in draft form and under review.)
  --U.S. EPA. Predicting Future Introductions of Non-indigenous Species 
        to the Great Lakes (Final Report). U.S. Environmental 
        Protection Agency, Washington, DC, EPA/600/R-08/066F, 2008. 
        (http://cfpub.epa.gov/ncea/cfm/recordisplay. cfm?deid=190305)
  --U.S. EPA. The Effects of Mountaintop Mines and Valley Fills on 
        Aquatic Ecosystems of the Central Appalachian Coalfields (Final 
        Report). U.S. Environmental Protection Agency, Washington, DC, 
        EPA/600/R-09/138F, 2011. (http://cfpub.epa.gov/ncea/cfm/
        recordisplay.cfm?deid=225743).
  --U.S. EPA. Clinch and Powell Valley Watershed Ecological Risk 
        Assessment. U.S. Environmental Protection Agency, Office of 
        Research and Development, National Center for Environmental 
        Assessment, Washington Office, Washington, DC, EPA/600/R-01/
        050, 2002.(http://cfpub.epa.gov/ncea/cfm/
        recordisplay.cfm?deid=15219).
  --U.S. EPA. Ecological Risk Assessment for the Middle Snake River, 
        Idaho. U.S. Environmental Protection Agency, Office of Research 
        and Development, National Center for Environmental Assessment, 
        Washington Office, Washington, DC, EPA/600/R-01/017, 2002. 
        (http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm? 
        deid=29097&partner=ORD-NCEA).
  --U.S. EPA. Waquoit Bay Watershed Ecological Risk Assessment: the 
        Effect of Land-Derived Nitrogen Loads on Estuarine 
        Eutrophication. U.S. Environmental Protection Agency, Office of 
        Research and Development, National Center for Environmental 
        Assessment, Washington Office, Washington, DC, 600/R-02/079, 
        2002. (http://cfpub.epa.gov/ncea/cfm/
        recordisplay.cfm?deid=15221).
    Question. Can you describe in more detail the process that you will 
use for this assessment? For example, will you follow the 
Administrative Procedures Act (APA), provide for peer review of the 
science and economic analysis, and solicit input from all stakeholders? 
Will the conclusions reached by the ``watershed assessment'', or 
actions taken pursuant to it, be subject to judicial or administrative 
review?
    Answer. The EPA's February 7, 2011, ``Outline of the Development of 
EPA's Bristol Bay Watershed Assessment'' briefly describes the process 
the EPA intends to use to better understand the aquatic resources at 
issue and to evaluate potential impacts to those resources from large-
scale development activities, such as mineral mining. As we emphasized 
in our March 21, 2011, letter to you, we plan to work with our Federal, 
State, and tribal partners, and the public, to assess the resources in 
Bristol Bay and identify options for improving protections for 
fisheries in the Bay that depend so significantly on clean water and a 
healthy watershed. We look forward to working with Federal agencies, 
corresponding State agencies, tribes, and others to take advantage of 
their experience and information to support the Bristol Bay assessment. 
As part of the assessment process, the EPA will collaborate with an 
extensive list of Federal, State, tribal, and local government agencies 
and organizations; the public; private interests such as mining project 
proponents; and others with an interest in Bristol Bay. The EPA's 
effort to conduct a watershed assessment is not an action that triggers 
APA requirements. Nevertheless, as described above, the EPA intends to 
conduct the assessment process in an open and transparent manner that 
is consistent with the openness and transparency envisioned by the APA.
    The EPA has also published guidelines for Ecological Risk 
Assessment which will help to inform our approach to the Bristol Bay 
assessment. These guidelines can be found at: http://www.epa.gov/raf/
publications/guidelines-ecological-risk-assessment.htm.
    The peer-review process will be a critical element of the watershed 
assessment and we appreciate the importance of this issue as reflected 
in your question. The details of EPA's Bristol Bay watershed 
assessment, including the details of the peer-review process that will 
be used for this assessment, are still being developed. However, the 
EPA has established standards and procedures regarding peer review 
which can be found in the EPA's Peer Review Handbook (see: http://
www.epa.gov/peerreview/). We look forward to providing additional 
details regarding the peer-review process as the assessment moves 
forward.
    Question. As I am sure you know, the Congress in 1971 in passing 
the Alaska Native Claims Settlement Act gave Alaska Native Corporations 
control more than 44 million acres of lands in Alaska, not Alaska 
Native tribes. Under a host of Federal statues, more than 120 of them, 
Native corporations in Alaska have similar authorities to tribes. Will 
the EPA provide the same level of consultation and access to providing 
input to the watershed assessment in the Bristol Bay region to Native 
regional and village corporations as to tribes in the area? Clearly 
since most of the lands surrounding the Pebble mine site are owned by 
Native corporations, they have a great deal at stake from any potential 
rules or EPA actions that are an outgrowth of your watershed 
assessment.
    Answer. The EPA looks forward to working closely with Alaska tribes 
and Native Corporations as part of our assessment in Bristol Bay. The 
EPA recognizes the strong interest and authorities of Alaska Native 
Corporations organized pursuant to the Alaska Native Claims Settlement 
Act regarding the land and resources in the Bristol Bay watershed. The 
EPA consults with Alaska Native Corporations as required by Public Law 
108-199, 118 Stat. 452, as amended by Public Law 108-447, 118 Stat. 
3267, and also interacts with both Alaska Native Corporations and 
federally recognized tribes pursuant to a number of other statutes and 
legal doctrines. The EPA intends to meet with Alaska Native 
Corporations to share information and solicit their views and input 
regarding the pending Bristol Bay watershed assessment subject to the 
same general considerations of practicability, expense, and scheduling 
that apply to our interactions with federally recognized tribal 
government and other critical stakeholders.
                                 ______
                                 
                   Environmental Protection Agency,
                                           Office of Water,
                                    Washington, DC, March 21, 2011.
Hon. Lisa A. Murkowski,
United States Senate,
Washington, DC.
    Dear Senator Murkowski: Thank you for your letter of February 16, 
2011, to Administrator Lisa P. Jackson concerning the Environmental 
Protection Agency's (EPA) recent announcement to initiate a watershed 
assessment of the Bristol Bay, Alaska. As the senior policy manager of 
the EPA's national water program, I appreciate the opportunity to 
respond to your letter.
    Your letter focuses on the EPA's proposed Bristol Bay assessment, 
provides a number of recommendations for the assessment, and raises a 
set of specific questions. In response, we are providing background 
information regarding the assessment and an answer to each of the 
questions in your letter. I want to emphasize the EPA's commitment to 
work with our Federal, State, and tribal partners to proceed with an 
unbiased and transparent public process supported by the best- 
available scientific information. We look forward to keeping you 
personally informed as this assessment moves ahead.
    During the last year, a number of tribes, tribal entities, and 
other groups in southwest Alaska requested that the EPA initiate review 
of metallic sulfide mining in the Bristol Bay watershed utilizing our 
authorities pursuant to section 404(c) of the Clean Water Act (CWA). 
Other Alaska tribes, tribal entities, and groups have requested that we 
not take action under section 404(c) and instead use the standard CWA 
permitting process to evaluate proposed mining operations in the 
Bristol Bay watershed. I believe the conclusion common to both sets of 
requests is the strong belief that effective protection of Bristol Bay 
is vitally important to the health and sustainability of the area's 
valuable commercial and subsistence salmon fisheries. We believe that 
an effective and timely Bristol Bay assessment involving a broad range 
of stakeholders and the public is responsive to these requests and will 
provide needed information and data to inform future decisions.
    In response to these requests, the EPA announced on February 7, 
2011, its decision to initiate a Bristol Bay watershed assessment. This 
assessment will characterize the potential risks of large-scale 
development on the Bay's water quality and salmon fishery, and evaluate 
measures to protect the watershed to ensure the sustainability of the 
fishery. While the Bristol Bay watershed is comprised of seven 
drainages, the Kvichak and Nushagak watersheds are the principal 
drainages with lands open to large-scale development. The EPA's 
analysis, therefore, will focus primarily on those two watersheds. We 
will conduct the assessment in an open, public format and in close 
coordination with Federal, State, and tribal organizations. This 
assessment will identify options available to provide appropriate 
protection for waters in Bristol Bay and the salmon fishery which 
depends on clean water and a healthy watershed.
    We appreciate and will give full consideration to your specific 
recommendations regarding the:
  --Need for extensive coordination of the assessment with State, 
        tribal, and local governments, Alaskan universities, Alaska 
        Native Tribal Corporations, interested nongovernmental 
        organizations, representatives of the Alaska fishing industry, 
        the Pebble Partnership and others;
  --Need for thorough peer review of the assessment, consistent with 
        the policies established in the EPA's Peer Review Handbook; and
  --Scope of the assessment's economic evaluation.
    I hope my letter and enclosed detailed responses effectively 
address the questions in your letter. In light of the concerns that 
have been raised to the EPA, I want to reassure you that we will 
conduct an open and scientifically based assessment built upon 
participation by other Federal and State agencies, local tribal 
governments, and the public. I look forward to informing you of 
progress on this assessment as we move ahead.
    Again, thank you for your letter.
            Sincerely,
                                           Nancy K. Stoner,
                                    Acting Assistant Administrator.
                                 ______
                                 
    Question. If the EPA has conducted a ``watershed assessment'' 
before, would you provide copies of the assessments and the statutory 
authorities under which they were conducted? If not, please provide a 
description of the statutory authorities for this assessment.
    Answer. The mission of the EPA is to protect human health and the 
environment. As such, evaluating the environmental impacts of different 
actions is a central role and function of the agency. The EPA has 
conducted environmental assessments that evaluate the impacts of past 
actions or estimate the potential impacts of future actions. Below is a 
list of several recent examples of such assessments. This information 
can also be found in our March 21, 2011, response to your February 16, 
2011, letter. (Please note that some of these assessments are currently 
in draft form and under review.)
  --U.S. EPA. Predicting Future Introductions of Non-indigenous Species 
        to the Great Lakes (Final Report). U.S. Environmental 
        Protection Agency, Washington, DC, EPA/600/R-08/066F, 2008. 
        (http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm?deid=190305)
  --U.S. EPA. The Effects of Mountaintop Mines and Valley Fills on 
        Aquatic Ecosystems of the Central Appalachian Coalfields (Final 
        Report). U.S. Environmental Protection Agency, Washington, DC, 
        EPA/600/R-09/138F, 2011. (http://cfpub.epa.gov/ncea/cfm/
        recordisplay.cfm?deid=225743).
  --U.S. EPA. Clinch and Powell Valley Watershed Ecological Risk 
        Assessment. U.S. Environmental Protection Agency, Office of 
        Research and Development, National Center for Environmental 
        Assessment, Washington Office, Washington, DC, EPA/600/R-01/
        050, 2002.(http://cfpub.epa.gov/ncea/cfm/
        recordisplay.cfm?deid=15219).
  --U.S. EPA. Ecological Risk Assessment for the Middle Snake River, 
        Idaho. U.S. Environmental Protection Agency, Office of Research 
        and Development, National Center for Environmental Assessment, 
        Washington Office, Washington, DC, EPA/600/R-01/017, 2002. 
        (http://cfpub.epa.gov/ncea/cfm/recordisplay.cfm? 
        deid=29097&partner=ORD-NCEA).
  --U.S. EPA. Waquoit Bay Watershed Ecological Risk Assessment: the 
        Effect of Land-Derived Nitrogen Loads on Estuarine 
        Eutrophication. U.S. Environmental Protection Agency, Office of 
        Research and Development, National Center for Environmental 
        Assessment, Washington Office, Washington, DC, 600/R-02/079, 
        2002. (http://cfpub.epa.gov/ncea/cfm/
        recordisplay.cfm?deid=15221).
    The EPA's Bristol Bay assessment, focusing primarily on the Kvichak 
and Nushagak watersheds, will characterize the risks of large-scale 
development on the Bay's water quality and salmon fishery, and evaluate 
measures to protect the watersheds and ensure the sustainability of the 
fishery. EPA is conducting this assessment under our Clean Water Act 
section 104 authorities described below. The objective of the Clean 
Water Act is to restore and maintain the chemical, physical, and 
biological integrity of the nation's waters. Toward achievement of that 
objective, section 104(a) directs the EPA to establish national 
programs for the prevention, reduction, and elimination of pollution 
and as part of such programs directs the EPA to:

    ``(1) in cooperation with other federal, state, and local agencies, 
conduct and promote the coordination and acceleration of, research, 
investigations, experiments, training, demonstrations, surveys, and 
studies relating to the causes, effects, extent, prevention, reduction, 
and elimination of pollution;
    ``(2) encourage, cooperate with, and render technical services to 
pollution control agencies and other appropriate public or private 
agencies, institutions, and organizations, and individuals, including 
the general public, in the conduct of activities referred to in 
paragraph (1) of this subsection;
    ``(3) conduct, in cooperation with State water pollution agencies 
and other interested agencies, organizations and persons, public 
investigations concerning the pollution of any navigable waters, and 
report on the results of such investigations . . .''

    Section 104(b) further states that in carrying out these 
provisions, EPA's Administrator is authorized to:

    ``(1) collect and make available, through publications and other 
appropriate means, the results of and other information, including 
appropriate recommendations by [her] him in connection therewith, 
pertaining to such research and other activities referred to in 
paragraph (1) of subsection (a);
    ``(2) cooperate with other Federal departments and agencies, State 
water pollution control agencies, interstate agencies, other public and 
private agencies, institutions, organizations, industries involved, and 
individuals, in the preparation and conduct of such research and other 
activities referred to in paragraph (1) of subsection (a) . . .''
    Question. Will the conclusions reached by the ``watershed 
assessment', or actions taken pursuant to it, be subject to judicial or 
administrative review?
    Answer. The EPA's ``Outline of the Development of EPA's Bristol Bay 
Watershed Assessment'' briefly describes the process EPA intends to use 
to better understand the aquatic resources at issue, and to evaluate 
potential impacts to those resources from large-scale development 
activities, such as mineral mining. We hope to work with our Federal, 
State, and tribal partners, and the public, to use this information to 
identify options for improving protection for Bristol Bay fisheries and 
the waters on which these fisheries rely. The watershed assessment or 
publication of such an assessment is, itself, not a final agency action 
and therefore not subject to judicial or administrative review. Should 
the EPA proceed as a result of the recommendations identified in the 
assessment to take some final agency action, such action may be subject 
to review. Our goal, however, is to work with interested federal, 
state, and tribal groups, and the public, to prepare recommendations 
that would be broadly supported.
    Question. Should a veto be exercised pre-emptively within the 
Bristol Bay watershed--not in relation to an application to undertake 
specific development in the area--could that decision be interpreted by 
courts or future administrations to extend more broadly to all future 
development proposals (e.g., an airstrip, fish-processing plant, 
refinery, hospital, school, museum) that may require a dredge or fill 
disposal site?
    Answer. The EPA's assessment is not a regulatory action. This 
assessment will help inform consideration of options for improving 
protection of the Bristol Bay watershed. The EPA has made no decision 
at this time to proceed with a CWA section 404(c) review in Bristol 
Bay. As a result, we are not prepared to speculate regarding the scope 
of any action taken under this authority.
    Question. It seems that a pre-emptive veto could set a number of 
highly problematic precedents. For example, the Bureau of Land 
Management, the U.S. Forest Service, and other Federal agencies have 
historically been tasked with land planning decisions on Federal 
acreage. Similarly, State lands are managed by analogous entities. 
Should the EPA issue a pre-emptive veto of an entire area which, in 
this case, consists largely of State lands, those aforementioned 
agencies would no longer be able to plan for multiple-use activities, 
but instead be subjected to pre-emptive yes-or-no decisions from the 
EPA under whatever speculative assumptions regarding development the 
EPA may choose to adopt.
    Has the EPA considered the precedents that would be set by a pre-
emptive veto? Has the EPA consulted relevant Federal and State agencies 
regarding such a course of action? Could third-party litigants cite the 
veto as precedent in opposing other projects within the watershed?
    Answer. The EPA has not made any decision regarding whether or not 
to initiate an advance 404(c) action at this time. As we have 
emphasized, we have instead chosen to work with our Federal, State, and 
tribal partners, and the public, to assess the resources in Bristol Bay 
and identify options for improving protections for fisheries in the Bay 
that depend so significantly on clean water and a healthy watershed. We 
look forward to working with Federal agencies, corresponding state 
agencies, tribes, and others to take advantage of their experience and 
information to support the Bristol Bay assessment. As part of the 
assessment process, the EPA will collaborate with an extensive list of 
Federal, State, tribal, and local government agencies and 
organizations; the public; private interests such as mining project 
proponents; and others with an interest in Bristol Bay. The EPA's 
assessment process is being conducted in an open and transparent manner 
to allow the issues you have raised to be effectively raised and 
discussed. This information and public discussion will help inform 
decisions following completion of the study.
    Question. In response to the petition received by the EPA to 
preemptively veto development in the Bristol Bay area under section 
404(c) of the CWA, were responses other than the conduct of a watershed 
assessment considered by the EPA? Specifically, did the agency consider 
simply informing the petitioners of the need to wait until an actual 
permit application had been received for consideration under the CWA, 
the National Environmental Policy Act, and other relevant statutes? 
Conversely, did the EPA consider issuing a preemptive veto in response 
to the petition?
    Answer. As previously noted, in 2010, a number of tribes, tribal 
entities and other groups in southwest Alaska requested that the EPA 
initiate review of metallic sulfide mining in the Bristol Bay watershed 
utilizing our authorities pursuant to section 404(c) of the Clean Water 
Act. Other Alaska tribes, tribal entities and groups requested that we 
let the typical permitting process for mines run its course. The EPA 
considered a number of options, including the two you note above, and 
relevant information before determining that the best option at this 
point, given the available information, is the assessment that we have 
chosen to conduct.
    Question. Because primary authority over fill decisions rests with 
the Army Corps of Engineers, and because the EPA has rarely exercised 
veto authority over Corps approvals, what deficiency does the EPA 
forecast with what would presumably be the Corps' work on any proposed 
fill application, to such extent that the EPA feels compelled to 
conduct this analysis in advance of any such work?
    Answer. The EPA works very closely with the U.S. Army Corps of 
Engineers in implementing our joint responsibilities under section 404 
of the Clean Water Act. The EPA has a great deal of respect for the 
work that the Corps does in administering the section 404 permitting 
program. The fact that EPA has rarely exercised its authority under 
section 404(c) to question the Corps' permit decisions speaks to the 
effective level of coordination and cooperation between the two 
agencies. The assessment that the EPA is undertaking is to develop 
information to respond to requests from tribes and other groups in the 
State.

                   GREAT LAKES RESTORATION INITATIVE

    Question. In fiscal year 2010, a new program was started within the 
EPA's budget for restoration of the Great Lakes. In the first year, 
$475 million was appropriated. It is my understanding that you have 
only spent $81 million of this as of January 31 of this year. In a time 
of tight budgets, that raises the question of whether you can spend all 
that you have asked for in this year's request--$350 million.
    What level of carryover do you have from previous years for this 
program?
    Answer. Through January of 2011, $455.6 million of Great Lakes 
Restoration Initiative funds had been obligated and $81 million had 
been expended. By May 5, 2011 almost the full $475 million has been 
obligated, less than $500,000 in carryover remains, and more than $115 
million has been expended. Much of the fiscal year 2010 funding was put 
toward restoration projects that will begin during this spring's 
construction season. Consequently, we expect to see accelerated 
expenditures and results this year from the fiscal year 2010 funding as 
construction begins. Now moving into its second year, we expect to also 
provide fiscal year 2011 funding during this construction season and to 
continue accelerated expenditures.
    Question. Can you spend the full amount that you have requested for 
fiscal year 2012?
    Answer. The EPA--working with its Federal partners, as well as the 
States, tribes, local governmental organizations, universities, and 
nongovernmental organizations--can spend the full amount requested for 
fiscal year 2012. Many excellent grant proposals did not get funded in 
fiscal year 2010 (requests totaling almost $1 billion were almost six 
times the amount available). Many excellent grant proposals will again 
not be funded in fiscal year 2011 (requests were more than triple the 
amount available under the EPA's fiscal year 2011 Great Lakes 
Restoration Initiative Request for Applications). As a result, we 
expect that requests for funding in fiscal year 2012 will once again 
outstrip available funding. A significant level of work still needs to 
be done to achieve restoration of the Great Lakes. There are many 
projects that have not yet been started.

                     SUPERFUND TAX REAUTHORIZATION

    Question. The budget request for fiscal year 2012 indicates that 
the administration supports reinstating the Superfund tax. This tax 
expired in 1995.
    As you know, industry vigorously opposes reinstatement. In their 
view, they have paid not only for sites that they were responsible for, 
but ``orphaned'' sites as well where there were no responsible parties. 
And reinstatement of the tax on companies with no responsibility for 
contamination would be unfair. How would you respond to these 
criticisms?
    Answer. The administration strongly supports the ``Polluter Pays'' 
principle. Parties should be liable for the cost of cleanups at sites 
for which they have responsibility, either as an owner, operator, 
generator, or transporter. Given that many Superfund sites involve 
historic activity where the environmental contamination became evident 
years after operations ceased, the EPA is sometimes unable to 
sufficiently identify and prove all of the parties that bear 
responsibility for the site or the parties are no longer financially 
viable or have a limited ability to pay.
    Since appropriated resources for Superfund are primarily supported 
by general revenues from taxes paid by the general public, the 
reinstated taxes would apply to a more narrowly defined taxable group, 
consistent with other trust funds. Therefore, general taxpayers would 
no longer shoulder a disproportionate share of funding hazardous waste 
site cleanup. The reinstated taxes would restore the historic nexus 
that the parties who most directly benefit from the manufacture or sale 
of substances that commonly contaminate hazardous waste sites should 
bear the cost of cleanup when viable potentially responsible parties 
cannot be identified.
    Question. What economic impacts would reinstating the tax have on 
industry and jobs in the current economic climate?
    Answer. The administration is proposing to reinstate the taxes as 
they were last in effect on crude oil, imported petroleum products, 
hazardous chemicals, and imported substances that use hazardous 
chemicals as a feedstock, and on corporate modified alternative minimum 
taxable income (AMTI). A 1994 study sponsored by the EPA investigated 
the economic impact of the Superfund taxes by calculating the maximum 
potential effect of each tax on prices or profits.\1\ These maximum 
impacts were all found to be relatively small, indicating that the 
taxes have only minor economic effects. Using the same methods with 
current economic data, the conclusions of the 1994 study are supported. 
Furthermore, the administration chose not to adjust the tax rates for 
inflation, effectively resulting in a lower tax than was last imposed. 
The administration believes this proposal is the most viable given the 
relative familiarity with the previous tax structure and current 
economic climate. Since the petroleum and chemical taxes have not been 
updated to reflect real dollars, their economic impact may actually 
decrease.
---------------------------------------------------------------------------
    \1\ ``Economic Impacts of Superfund Taxes'', Prepared by Industrial 
Economics, Inc., for the Office of Policy Analysis, EPA (1994).
---------------------------------------------------------------------------
    Relative to consumer demand for other products, the demand for oil 
has been fairly unresponsive to price changes. Regarding the petroleum 
tax, even if the entire tax is passed on to consumers, the estimated 
impact would be less than a half penny per gallon increase in gas 
prices. Such an increase in gas prices would represent only a 0.17 
percent increase to the 2010 average retail price of gasoline of $2.84 
per gallon.\2\
---------------------------------------------------------------------------
    \2\ This calculation is based on the 2010 annual average U.S. 
conventional retail price from the Energy Information Administration.
---------------------------------------------------------------------------
    Current data suggest that the taxes on chemicals should have only 
minor economic impacts. These taxes were originally calculated as the 
lower of two figures:
  --2 percent of the estimated wholesale price; or
  --$4.87 per ton for organic chemicals and $4.45 per ton for inorganic 
        chemicals.
    Current data indicate that the majority of the chemical prices have 
increased considerably since the tax was last in operation, with some 
more than doubling.\3\ On the other hand, the Superfund taxes will not 
be corrected for inflation. This should significantly reduce, below 2 
percent, the potential economic impact of the taxes on chemicals. 
Regarding the international marketplace, the proposed taxes will apply 
equally to imported chemicals as well as domestic. Thus, it is unlikely 
that these taxes would cause any change in a manufacturer's or an 
industry's mix of domestic and imported chemical substances.\4\
---------------------------------------------------------------------------
    \3\  Recent annual chemical prices obtained from www.icis.com.
    \4\ ``Economic Impacts of Superfund Taxes,'' Prepared by Industrial 
Economics, Inc, for the Office of Policy Analysis, EPA (1994).
---------------------------------------------------------------------------
    Finally, the Corporate Environmental Tax of 0.12 percent is imposed 
on firms with AMTI exceeding $2 million. When it last expired, 89 
percent of the tax was paid by firms with assets greater than $250 
million. The 1994 study found that the maximum estimated impact on the 
prices charged by affected firms did not exceed 1 percent in any of the 
major industrial categories, and was 0.09 percent across all 
industries.\5\ Since the tax only targets AMTI over a threshold, many 
small businesses will not have to pay. Large businesses that are taxed 
will only pay a miniscule fraction of AMTI. Thus, the corporate tax 
should have only minor economic impacts.
---------------------------------------------------------------------------
    \5\ Ibid.
---------------------------------------------------------------------------
    Question. When do you plan to send a specific legislative proposal 
to the Congress?
    Answer. On June 21, 2010, EPA Administrator Lisa Jackson on behalf 
of the administration transmitted draft legislation to the Congress to 
reinstate Superfund taxes. We support reauthorization of the taxes as 
represented in this transmission.
    Question. Will your new legislative proposal contain any changes to 
the way the existing Superfund program is run?
    Answer. On June 21, 2010, EPA Administrator Lisa Jackson on behalf 
of the administration transmitted draft legislation to the Congress to 
reinstate Superfund taxes. The proposal did not contain any changes to 
the way the existing Superfund program is run. Rather, it focuses on 
generating revenues that will be placed in the Superfund Trust Fund to 
provide a stable, dedicated source of funds to operate the program.
    The proposal reinstates the taxes as they were last in effect on 
crude oil, imported petroleum products, hazardous chemicals, and 
imported substances that use hazardous chemicals as a feedstock, and on 
corporate modified AMTI. The Superfund taxes were applied to crude oil 
and imported petroleum products (9.7 cents per barrel), chemicals used 
in the production of hazardous substances listed in title 26 section 
4661 (22 cents to $4.87 per ton), imported substances that use 
hazardous chemicals as a feedstock (in an amount equivalent to the tax 
that would have been imposed on domestic production), and corporate 
modified AMTI \6\ in excess of $2 million a year (0.12 percent). The 
excise taxes would be applied beginning in January 2012 and expire on 
December 31, 2021, and the income tax would be applied in taxable years 
beginning after 2011 and would expire for taxable years beginning after 
December 31, 2021.
---------------------------------------------------------------------------
    \6\ Modified AMTI is AMTI determined without regard to the 
alternative minimum tax net operating loss deduction and the deduction 
for the Superfund environmental income tax.
---------------------------------------------------------------------------
        LONG-TERM 2 (LTR2) ENHANCED SURFACE WATER TREATMENT RULE

    Question. The purpose of the LT2 rule is to reduce illness linked 
with the contaminant Cryptosporidium and other disease-causing 
microorganisms in drinking water. These are primarily associated with 
uncovered finished water reservoirs.
    In the past, the EPA has stated that they will not enforce the LT2 
rule in Alaska's native villages because of the cost of compliance. Is 
this EPA's official position?
    Answer. The EPA's position is that all public water systems, 
including Alaska Native Village systems, that use surface water or 
groundwater that is under the direct influence of surface water, are 
required to comply with the LT2 Enhanced Surface Water Treatment Rule. 
The EPA has been working hard to ensure that the rule is enforced 
fairly and consistently throughout the country. The LT2 rule builds 
upon the requirements established by the Surface Water Treatment Rule 
(SWTR); Interim Enhanced Surface Water Treatment Rule (IESWTR); and the 
Long Term 1 Enhanced Surface Water Treatment Rule by requiring water 
systems to determine if their source water is vulnerable to 
Cryptosporidium, and where applicable, incorporating additional 
treatment. In addition, the LT2 rule requires that all finished water 
reservoirs either be covered or the discharge treated.
    On January 28, 2011, Alaska formally adopted the LT2 rule. As a 
result, Alaska Department of Environmental Conservation (ADEC) is now 
the primary enforcement agency for the rule. As the primary enforcement 
agency, ADEC is responsible for ensuring that all public water systems 
in Alaska, including systems serving Alaska Native Villages that are 
subject to the rule are in compliance.
    Most Alaska Native Village systems have less than 10,000 users, and 
may utilize less costly monitoring requirements than systems servicing 
larger communities. In contrast to systems servicing 10,000 people or 
more, which are required to monitor for Cryptosporidium, smaller 
systems are allowed to first monitor for E. coli--a bacterium that is 
less expensive to analyze than Cryptosporidium--and are only required 
to monitor for Cryptosporidium if their E. coli results exceed 
specified concentration levels.
    Question. The purpose of the LT2 rule is to reduce illness linked 
with the contaminant Cryptosporidium and other disease-causing 
microorganisms in drinking water. These are primarily associated with 
uncovered finished water reservoirs.
    We do have some communities that are slightly larger, but still 
very small by anyone's standards. Some of them are having a very 
difficult time coming up with the funding to add treatment and come 
into compliance with the LT2 rule. Is the EPA prepared to assist these 
small communities either with financial help or compliance assistance 
to help alleviate the severe financial burden that the rule imposes?
    Answer. The EPA has historically provided about 25 percent of the 
total Tribal Set Aside from the Drinking Water State Revolving Fund 
capitalization grant funding to support drinking water infrastructure 
construction in the Alaska Native Villages. These funds, along with 
funds from the EPA's Alaska Native Village program and other Federal 
agencies (the Indian Health Service, Department of Agriculture and the 
Department of Housing and Urban Development) can be utilized to fund 
infrastructure projects that address compliance challenges associated 
with LT2 for the Alaska Native Villages. In addition, Alaska Native 
Village water systems may apply for infrastructure financing through 
Alaska's Drinking Water State Revolving Fund.

                              FOREST ROADS

    Question. For close to 35 years, the EPA has defined in its 
regulations (40 CFR 122.27) that forestry operations are nonpoint 
sources and therefore not subject to Federal CWA permits. Forestry has 
a documented record of compliance. A recent decision by the Ninth 
Circuit Court of Appeals threatens to overturn 35 years of precedent 
and treat forest roads on Federal, State, and private land as point 
sources requiring Federal permits. The EPA is not a party in the case. 
The 9th Circuit is presently deciding whether to reconsider the case en 
banc. In advance of this decision, the EPA has been preparing to 
implement the potential court order nationwide. If the court upholds 
the earlier decision and the EPA aggressively implements the final 
ruling, it would constitute an unprecedented expansion of EPA 
regulation under the CWA. I understand that the 9th Circuit Court of 
Appeals has questioned the EPA's 35-year treatment of forest roads as 
nonpoint sources under existing regulations. Most of these roads are 
indistinguishable from county roads and other roads used for 
transportation, recreation access, and a variety of other critical uses 
throughout my State. Requiring new permits for these roads would impose 
potentially enormous new costs and legal exposure on the people of 
Alaska who use these roads every day.
    Does the EPA plan to stand behind its own long-standing regulation 
and seek to avoid imposing this enormous regulatory and legal burden on 
forest workers, counties, Federal land managers, and other users in 
Alaska and throughout the country?
    Answer. On August 17, 2010, the U.S. Court of Appeals for the Sixth 
Circuit issued a decision holding that stormwater runoff from forest 
roads that is collected by and discharged from a stream of ditches, 
culverts, and channels is a point-source discharge for which a National 
Pollutant Discharge Elimination System (NPDES) permit is required. That 
court is now reviewing requests for rehearing. In the meantime, the EPA 
recognizes these sources of stormwater discharges, which were 
previously exempt from the requirements to obtain and comply with an 
NPDES permit, are now vulnerable to citizen suits for discharging 
without a permit. Because of this, the agency is exploring various 
options for providing permit coverage to these discharges.

                            LEAD PAINT RULE

    Question. The Lead Renovation Repair and Painting (LRRP) Program 
rule represents an added cost that contractors, who pay to become 
trained and certified under the rule, then pass on to consumers. In 
many cases the LRRP requirements can add a significant percentage to 
the cost of upgrades and remodels. In States where there is a lack of 
enforcement, ``good actor'' contractors are pricing themselves out of 
the market due to the fact that many contractors are not in compliance 
for the rule and are not being subjected to enforcement, and therefore 
are able to offer lower costs to consumers.
    Do you have any data on the actual additional costs being incurred 
by homeowners, building owners, and contractors that comply with the 
lead safety rule, the level of compliance, and the status of the 
enforcement of the EPA's Lead Paint Rule throughout the States?
    Answer. In order to comply with the RRP rule, contractors will 
incur the following fees and estimated costs:
      Certification Costs.--Firm certification is valid for 5 years. 
        The fee for most firms is $300, which is equivalent to a cost 
        of $60 per year.
      Training Costs.--To become a certified renovator, an individual 
        must take a training course from a private training provider 
        accredited by the EPA. The trained renovators can then provide 
        on-the-job training to other workers. The EPA estimates that 
        this costs $560 per person trained, including a tuition cost of 
        $186 (set by the training provider); the value of time for the 
        8 hours the renovator is in class ($253); the value of time for 
        2 hours traveling to and from class ($63); mileage costs to 
        drive to and from the training ($49); and lunch while at the 
        training ($9). The renovator's certification lasts for 5 years.
      Labor, Equipment, and Supply Costs.--As part of the rulemaking 
        process, the EPA conducted an extensive economic analysis that 
        estimated the labor, equipment, and supply costs for these work 
        practices. The EPA first estimated an absolute cost of 
        complying with the lead-safe work practices required by a rule 
        if a contractor did not use any containment, or perform any 
        cleaning, or cleaning verification prior to the rule. However, 
        the EPA heard from the industry that contractors had already 
        been taking steps to control dust from renovations prior to the 
        promulgation of the rule. Based on this input, the EPA 
        estimated an average incremental cost of each lead-safe work 
        practice by subtracting the cost already being incurred by 
        renovators for containment and cleaning from the estimate of 
        the absolute cost of the rule's requirements.
    For typical jobs in single family homes, the EPA estimated that the 
average absolute costs to comply with the rule ranged from $35 to $376, 
depending on the size and nature of the job. The average incremental 
costs of complying with the rule ranged from $8 to $124. For example:
  --For a large window replacement job in a single family home (12 
        windows), the average cost ranges between $124 for contractors 
        who already used some of the required work practices, to $376 
        for contractors who did not use any of the required work 
        practices.
  --For a medium-sized job removing portions of a wall in a single-
        family home (such as might be done to repair water pipes or 
        electrical wiring), the average cost ranges between $41 for 
        contractors who already used some of the required work 
        practices, to $121 for contractors who did not use any of the 
        required work practices.
  --For an exterior painting job involving four exterior walls, the 
        average cost ranges between $90 for contractors who already 
        used some of the required work practices, to $245 for 
        contractors who did not use any of the required work practices.
    With the exception of the renovation firm certification fee, these 
costs are discussed in greater detail in chapter 4 of the EPA's 
``Economic Analysis for the TSCA Lead Renovation, Repair, and Painting 
Program Final Rule for Target Housing and Child-Occupied Facilities'' 
(March 2008) http://www.regulations.gov/#!document Detail;D=EPA-HQ-
OPPT-2005-0049-0916 The renovation firm certification fee of $300 was 
established in a subsequent rulemaking.
    The above data reflect the EPA's estimates of the cost incurred by 
contractors, not the price paid by homeowners and other property 
owners. The EPA assumes that contractors will generally pass along 
their costs to their customers, and anticipates they may also add a 
mark-up.
    Question. Can you give us an analysis of economic cost vs. health 
protection for the rule overall and for homes in which no children or 
young adults live?
    Answer. The following discussion of the benefits of the 2008 final 
RRP rule is taken from the Executive Summary of the ``Economic Analysis 
for the TSCA Lead Renovation, Repair, and Painting Program Final Rule 
for Target Housing and Child-Occupied Facilities'' (March 2008). 
Additional details can be found in the full report at http://
www.regulations.gov/#!documentDetail;D=EPA-HQ-OPPT-2005-0049-0916.
    The benefits of the rule result from the prevention of adverse 
health effects attributable to lead exposure. Neurotoxic effects in 
children and cardiovascular effects in adults are among those best 
substantiated as occurring at blood-lead concentrations as low as 5 to 
10 mg/dL (or possibly lower); and these categories of effects are 
currently clearly of greatest public health concern. Other newly 
demonstrated immune and renal system effects among general population 
groups are also emerging as low-level lead-exposure effects of 
potential public health concern. Both epidemiologic and toxicologic 
studies have shown that environmentally relevant levels of lead affect 
many different organ systems depending on level of exposure.
    Epidemiologic studies have consistently demonstrated associations 
between lead exposure and enhanced risk of deleterious cardiovascular 
outcomes, including increased blood pressure and incidence of 
hypertension. A meta-analysis of numerous studies estimates that a 
doubling of blood-lead level (e.g., from 5 to 10 mg/dL) is associated 
with a 1 mm Hg increase in systolic blood pressure and a 0.6 mm Hg 
increase in diastolic pressure. Studies have also found that cumulative 
past lead exposure (e.g., bone lead) may be as important, if not more, 
than present lead exposure in assessing cardiovascular effects. The 
evidence for an association of lead with cardiovascular morbidity and 
mortality is limited but supportive. Experimental toxicology studies 
have confirmed lead effects on cardiovascular functions. However, there 
is sufficient uncertainty about the level of exposure and likelihood of 
effects that adults will experience that this analysis did not attempt 
to estimate the number of cases that would be avoided due to the 
regulation.
    A further discussion of the benefits of removing the opt-out 
provision can be found in the Executive Summary of the ``Economic 
Analysis for the TSCA Lead Renovation, Repair, and Painting Program 
Opt-out and Recordkeeping Final Rule for Target Housing and Child- 
Occupied Facilities'' (April 2010). The 50-year annualized costs of the 
2008 final rule were estimated to range from $404 million to $441 
million per year, as detailed in chapter 4 of the EPA's ``Economic 
Analysis for the TSCA Lead Renovation, Repair, and Painting Program 
Final Rule for Target Housing and Child-Occupied Facilities'' (March 
2008). The additional costs of the removal of the opt-out provision 
were estimated to range from $295 million to $320 million per year, as 
detailed in the ``Economic Analysis for the TSCA Lead Renovation, 
Repair, and Painting Program Opt-out and Recordkeeping Final Rule for 
Target Housing and Child-Occupied Facilities'' (April 2010). Thus, the 
total costs of the Renovation, Repair, and Painting Program have been 
estimated at $699 million to $761 million per year.

                         HEALY CLEAN COAL PLANT

    Question. In 1992, the Federal Government provided $119 million of 
the $325 million cost of a clean coal power plant that was built in 
Healy, Alaska, and is now being operated by the Golden Valley Electric 
Coop. The EPA then issued an air permit for the plant. The EPA is 
apparently considering substantially altering the permit now as the 
plant is finally planning to move into continuous operations given the 
growing need for the electricity in Alaska's northern railbelt.
    Since the plant has been kept in warm status for more than a 
decade, between testing cycles, why is it not appropriate to permit the 
plant to run under its original permit since it is based on technology 
approved by the Department of Energy and your agency?
    Answer. The New Source Review (NSR) Program requires a company to 
get a pre-construction permit whenever it wants to construct a new 
facility or make major modifications at an existing one. Questions have 
been raised about whether the restart and associated restart activities 
at Healy would trigger the need for the NSR. Therefore, the EPA 
recognizes that a permit issued to Healy could be challenged by at 
least one nongovernmental stakeholder. Recognizing the unique situation 
at Healy, and the need for its generation, the EPA is currently 
facilitating discussions between the owners and operators of the source 
and other stakeholders with the goal of allowing the Alaska 
environmental agency to issue an operating permit to Healy that will 
provide certainty to the source, protect the environment, and satisfy 
the requirements of the NSR program.

                         FAIRBANKS AIR QUALITY

    Question. Last summer you visited Fairbanks, Alaska, and learned 
that the town, given its extreme cold temperatures in winter, will 
likely have considerable trouble meeting the proposed tightened 
standards for PM2.5 (fine particulate matter) under the 
Clean Air Act (CAA).
    Will the EPA give serious consideration to granting a waiver to the 
Fairbanks area from the tightening PM2.5 standards given the 
extreme difficulty that the town may have in meeting the standard at 
temperatures of 20 degrees below zero?
    Answer. The CAA does not provide the EPA with the authority to 
waive National Ambient Air Quality Standard requirements, but it does 
allow some flexibility in implementing the standards. The EPA is bound 
by section 172(a)(2) of the CAA which states that an area's attainment 
date ``shall be the date by which attainment can be achieved as 
expeditiously as practicable, but no later than 5 years from the date 
such area was designated nonattainment, except that the Administrator 
may extend the attainment date to the extent the Administrator 
determines appropriate, for a period no greater than 10 years from the 
date of designation as nonattainment considering the severity of 
nonattainment and the availability and feasibility of pollution control 
measures.'' Our regulations implementing this portion of the CAA give 
the States flexibility in proposing an appropriate attainment date as 
part of the overall plan to address fine particulate matter (40 CFR 
51.1004). Ultimate approval of the attainment date will depend on the 
technical merits of the final state submission; however our EPA Region 
10 Office is committed to making this process as efficient, 
collaborative, and common sense as possible.

IMPLEMENTATION OF NORTH AMERICAN EMISSION CONTROL AREA (ECA) IN ALASKAN 
                                 WATERS

    Question. Last year, the EPA imposed new rules requiring low-sulfur 
diesel fuel to be used by freight carriers and cruise ships in southern 
and central Alaska waters, even though all vessels serving Great Lake 
ports were exempted from the new standards and the new ECAs being 
created by the Agency and going into effect next year.
    Would the EPA, given the lack of such fuel in Alaska and at West 
Coast ports, consider delaying the implementation date of the Alaska/
Inside Passage air regulations given the extreme cost to shippers and 
thus consumers of meeting the new standards, at least until the Agency 
conducts actual Alaska specific air-quality tests to confirm the need 
for the rules in Alaska's maritime climate?
    Answer. Your question addresses two issues that the EPA takes very 
seriously--the availability of lower-sulfur fuels and the balance 
between achieving important health benefits and addressing the economic 
and technical concerns of industry.
    The EPA has taken actions to address these concerns, not only 
domestically but also as part of the administration's team at the 
International Maritime Organization (IMO).
    Before outlining those actions, we'd like to clarify that the fuel 
standard due to take effect next summer is the first phase 10,000 parts 
per million (ppm) sulfur standard, while the industry has until January 
2015 before the more stringent 1,000 ppm fuel-sulfur standard takes 
effect.
    In addition, we'd like to clarify that on all coasts, ships must 
comply with the emissions standards anytime they operate on the 
landward side of the North American ECA boundary even as they enter our 
internal waters. This includes operation within the Great Lakes. The 
narrow exclusion we adopted for a small subset of ships on the Great 
Lakes is discussed further below.
    On the issue of fuel availability, although we believe that 
compliant fuel will be broadly available for the first phase standard 
in 2012, we recognize that mariners need a mechanism to address an 
unexpected nonavailability of fuel that is beyond their control. The 
IMO treaty allows the United States to provide flexibility in the 
unlikely event a vessel cannot reasonably obtain compliant fuel.
    The EPA has taken actions to address concerns raised by industry 
regarding operating steamships (vessels with boilers rather than diesel 
engines for propulsion) on distillate fuel. First, in our final 
category 3 marine rule, the EPA excluded existing Great Lakes 
steamships from ECA fuel requirements, thus they may continue to use 
residual fuel oil. In addition, mirroring that action on the U.S. 
internal waters of the Great Lakes, we proposed to the IMO an exemption 
for steamships operating within the ECA. This would apply to the 
steamships that operate between Washington State and Alaska. By the 
narrowest of margins, our proposal was included among those that will 
proceed for circulation among IMO member states. We are striving to see 
that it is formally adopted by the IMO at its next committee meeting in 
July 2011.
    Throughout development of the ECA and our category 3 marine rule, 
we sought to maintain the important health benefits of the ECA 
emissions standards while addressing the serious economic and technical 
issues raised by the industry. We continue to believe the balance we 
achieved is the right path to protect citizens in Alaska and the rest 
of the Western United States from damaging particulate matter and 
sulfur oxides pollution. Overall, the monetized health benefits of the 
EPA's coordinated strategy for ships are projected to range from $110 
billion to $270 billion, assuming a 3 percent discount rate, or between 
$99 billion and $240 billion, assuming a 7 percent discount rate. These 
estimated benefits exceed the projected costs by a ratio of more than 
30:1.
    The EPA continues to be committed to working with the government of 
Alaska and regional/local businesses to assist with implementation in 
any way possible.

                          SUBCOMMITTEE RECESS

    Senator Reed. The hearing is now recessed.
    [Whereupon, at 3:46 p.m., Wednesday, March 16, the 
subcommittee was recessed, to reconvene subject to the call of 
the Chair.]
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