[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]




 FEDERAL REGULATION OF WATERS: IMPACTS OF ADMINISTRATION OVERREACH ON 
                    LOCAL ECONOMIES AND JOB CREATION

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

                                (113-66)

                             FIELD HEARING

                               BEFORE THE

                              COMMITTEE ON
                              
                   TRANSPORTATION AND INFRASTRUCTURE
                   
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                 APRIL 28, 2014 (Altoona, Pennsylvania)

                               __________

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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                  BILL SHUSTER, Pennsylvania, Chairman
DON YOUNG, Alaska                    NICK J. RAHALL, II, West Virginia
THOMAS E. PETRI, Wisconsin           PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         ELEANOR HOLMES NORTON, District of 
JOHN J. DUNCAN, Jr., Tennessee,          Columbia
  Vice Chair                         JERROLD NADLER, New York
JOHN L. MICA, Florida                CORRINE BROWN, Florida
FRANK A. LoBIONDO, New Jersey        EDDIE BERNICE JOHNSON, Texas
GARY G. MILLER, California           ELIJAH E. CUMMINGS, Maryland
SAM GRAVES, Missouri                 RICK LARSEN, Washington
SHELLEY MOORE CAPITO, West Virginia  MICHAEL E. CAPUANO, Massachusetts
CANDICE S. MILLER, Michigan          TIMOTHY H. BISHOP, New York
DUNCAN HUNTER, California            MICHAEL H. MICHAUD, Maine
ERIC A. ``RICK'' CRAWFORD, Arkansas  GRACE F. NAPOLITANO, California
LOU BARLETTA, Pennsylvania           DANIEL LIPINSKI, Illinois
BLAKE FARENTHOLD, Texas              TIMOTHY J. WALZ, Minnesota
LARRY BUCSHON, Indiana               STEVE COHEN, Tennessee
BOB GIBBS, Ohio                      ALBIO SIRES, New Jersey
PATRICK MEEHAN, Pennsylvania         DONNA F. EDWARDS, Maryland
RICHARD L. HANNA, New York           JOHN GARAMENDI, California
DANIEL WEBSTER, Florida              ANDREE CARSON, Indiana
STEVE SOUTHERLAND, II, Florida       JANICE HAHN, California
JEFF DENHAM, California              RICHARD M. NOLAN, Minnesota
REID J. RIBBLE, Wisconsin            ANN KIRKPATRICK, Arizona
THOMAS MASSIE, Kentucky              DINA TITUS, Nevada
STEVE DAINES, Montana                SEAN PATRICK MALONEY, New York
TOM RICE, South Carolina             ELIZABETH H. ESTY, Connecticut
MARKWAYNE MULLIN, Oklahoma           LOIS FRANKEL, Florida
ROGER WILLIAMS, Texas                CHERI BUSTOS, Illinois
MARK MEADOWS, North Carolina
SCOTT PERRY, Pennsylvania
RODNEY DAVIS, Illinois
MARK SANFORD, South Carolina
DAVID W. JOLLY, Florida
                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................    iv

                               TESTIMONY

Kenneth Murin, environmental program manager, Division of 
  Wetlands, Encroachment and Training, Bureau of Waterways, 
  Engineering and Wetlands, Pennsylvania Department of 
  Environmental Protection.......................................     6
David Spigelmyer, president, Marcellus Shale Coalition...........     6
Tonya Winkler, AICP, midstream permitting and compliance manager, 
  Rice Energy, Inc...............................................     6
Warren Peter, founder and president, Warren Peter Construction, 
  on behalf of the Indiana-Armstrong Builders Association, 
  Pennsylvania Builders Association, and National Association of 
  Home Builders..................................................     6
Thomas R. Nagle, Jr., president, Cambria County Farm Bureau, on 
  behalf of the Pennsylvania Farm Bureau.........................     6
Jacqueline Fidler, manager, environmental resources, CONSOL 
  Energy, Inc....................................................     6

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

Kenneth Murin....................................................    34
David Spigelmyer.................................................    39
Tonya Winkler....................................................    46
Warren Peter.....................................................    51
Thomas R. Nagle, Jr..............................................    60
Jacqueline Fidler................................................    65

                       SUBMISSION FOR THE RECORD

Steve Brown, president, National Association of Realtors, letter 
  to Hon. Bill Shuster, a Representative in Congress from the 
  State of Pennsylvania, April 25, 2014..........................     4
  
  
[GRAPHIC] [TIFF OMITTED] 


 
 FEDERAL REGULATION OF WATERS: IMPACTS OF ADMINISTRATION OVERREACH ON 
                    LOCAL ECONOMIES AND JOB CREATION

                              ----------                              


                         MONDAY, APRIL 28, 2014

                  House of Representatives,
    Committee on Transportation and Infrastructure,
                                            Washington, DC.
    The committee met, pursuant to call, at 9 a.m., at the 
Blair County Convention Center, One Convention Center Drive, 
Altoona, PA 16602, Hon. Bill Shuster (Chairman of the 
committee) presiding.
    Mr. Shuster. The committee will come to order. I first want 
to take the opportunity to thank everybody for coming out here 
today. I am pleased to welcome our panel of distinguished 
witnesses today. First of all, Ken Murin, environmental program 
manager for the Division of Wetlands, Encroachment and Training 
of the Bureau of Waterways, Engineering and Wetlands from the 
Pennsylvania Department of Environmental Protection. That is a 
long title, Mr. Murin. Thank you for being here. Mr. David 
Spigelmyer, the president of the Marcellus Shale Coalition; 
Tonya Winkler, AICP, midstream permitting and compliance 
manager for Rice Energy. Thank you for coming today. Warren 
Peter, the president of Warren Peter Construction. Thomas 
Nagle, president of the Cambria County Farm Bureau and a local 
cattle farmer, and Jacqueline Fidler, manager of environmental 
resources for CONSOL Energy. Thank you all for being here 
today. Today we are going to explore the impact and executive 
actions that the administration is taking to regulate the 
waters and restrict the development of important energy 
resources in Pennsylvania and elsewhere in the country.
    Last week the President published a proposed rule that 
would dramatically extend the reach of the Federal Government 
when it comes to regulating ponds, ditches, and other wet 
areas. This is an example of the disturbing pattern of the 
imperial Presidency that seeks to circumvent Congress. 
Unilaterally broadening the scope of the Clean Water Act and 
the Federal Government's reach into our everyday lives will 
have adverse effects on the economy and jobs, increase the 
likelihood of costly litigation, and restrict the rights that 
landowners and local governments enjoy regarding decisionmaking 
on their own land.
    This Federal jurisdiction--was the subject of failed 
legislation in the 110th and 111th Congress, and I would like 
to point out that both those Congresses were controlled by the 
Democrats in the House and Senate at the time. Strong 
bipartisan opposition prevented those Bills from moving 
forward. Even in Congress now the Obama administration is 
trying to achieve the power of expansion through a rulemaking. 
This proposed rule supposedly aims to clarify which water 
bodies are subject to Federal jurisdiction under the Clean 
Water Act. Twice the Supreme Court has told the agencies that 
there are limits to the Federal jurisdiction under the Clean 
Water Act and they have gone too far in asserting authority. So 
twice the Congress told the Democrats and twice the Supreme 
Court had said to the administration, the EPA, you don't have 
this jurisdiction.
    It is a responsibility of Congress, not the administration, 
to define the scope of jurisdiction under the Clean Water Act. 
Similarly, the administration is taking steps to restrict the 
development of important energy resources in Pennsylvania. The 
administration is utilizing the Wetlands permitting process 
under the Clean Water Act to throw obstacles in the way of 
developing and transporting to market the gathering lines of 
natural gas produced in the Marcellus Shale region. Since 2011 
when the Army Corps of Engineers issued Pennsylvania State a 
pragmatic general permit forum, the inferred concerns from 
industry and the DEP regarding several key changes have 
increased the permitting review time for natural gas gathering 
lines, delaying the delivery of gas from the well to the 
marketplace and delaying royalty payments to property owners 
and revenues to the State.
    I have met with and worked with industry, DEP, and the 
Corps over the last 3 years to attempt to address these 
concerns. While I am told the timeline has improved somewhat, 
the underlying changes that caused these problems in the first 
place have not been addressed. Regulations to the Nation's 
water must be done in a manner that responsibly protects the 
environment without unnecessary and costly expense to the 
Federal Government. We can continue to protect our waters 
without unreasonable and burdensome regulations on our 
businesses, farmers, and families.
    I look forward to hearing from all our witnesses today, 
about their experience and thoughts on both the issues, and 
thoughts on improvements on the next general permit issues in 
2015.
    I now yield to Mr. Gibbs, who is the chairman of the 
Subcommittee on Water Resources and Environment, for an opening 
statement.
    Mr. Gibbs. Thank you, Mr. Chairman, and I want to thank the 
witnesses for being here. I look forward to the testimony 
today.
    I would also like to thank Chairman Shuster for holding 
this very important and timely hearing--in Altoona. I 
appreciate your leadership on these important issues.
    On March 25 the EPA and the Army Corps of Engineers 
released a proposal that according to the agencies would 
clarify the scope of the Federal jurisdiction within the Clean 
Water Act. In reviewing the proposal I have serious concerns 
about implementations of water previously regulated by States 
rather than the Federal Government. When the Clean Water Act 
was first passed by Congress it was done so under the 
constitutional authority of the--clause defining jurisdiction 
as--waters. The proposal would effectively remove--resulting in 
the erosion of State authority and granting Federal 
jurisdiction to waters never intended for inclusion of the 
Clean Water Act, including ditches, manmade ponds, flood 
plains, and unseasonably wet areas.
    However, the agencies have continued to claim that no 
waters would be covered in the rulemaking--no new waters in the 
rulemaking. When I questioned Army Corps and agriculture 
officials in the hearings last month about this issue, I found 
that rather than clarifying the issue, they made it muddier. 
Additionally, we are here today to learn about the cost 
regulations permitting pipeline projects that appear to exist 
only in Pennsylvania.
    I am particularly concerned about this new time-consuming 
process that my own district in Ohio is located above a large 
portion of--formation. Ohio can expect to see development of 
natural gas lines--pipelines similar to here in Pennsylvania.
    Once again, I would like to thank the chairman for holding 
this important hearing and I look forward to hearing from the 
witnesses.
    Mr. Shuster. I thank the gentleman, and everybody--Mr. 
Gibbs from Ohio, as he said there, I want to introduce the 
other Members who made the trip here today. To my far left is 
Congressman Scott Perry from York County--York County, Adams 
and the center part--central Pennsylvania; Congressman Jeff 
Denham from California--the Central Valley in California; and 
Congressman Tom Rice from South Carolina, Myrtle Beach, the 
third most popular vacation spot in America.
    Mr. Rice. You mean you didn't come here for business?
    Mr. Shuster. I told him he needed to show some love to 
Pennsylvania because quite a few of our folks travel to Myrtle 
Beach for vacation.
    Mr. Rice. It----
    Mr. Shuster. And--Pennsylvania money, too. We appreciate 
you making the trip up here----
    Mr. Rice [continuing]. Come back early and all.
    Mr. Shuster. I thank each of the Members for being here and 
the staff for traveling up, and again, I appreciate the 
witnesses making the trip here today. I ask unanimous consent 
that the full statements be included in the record of all the 
witnesses. Since we have written testimony we ask that you keep 
your testimony to 5 minutes. I am pretty quick with the gavel, 
but I won't be too quick today. It is important, so I want to 
make sure you are heard, and any Members that don't get a 
chance to ask questions, we will keep the record open for 5 
days following this to pass on to you that opportunity.
    I will ask unanimous consent that written testimony 
submitted on behalf of the National Association of Realtors be 
included in this hearing--on this record.
    Without objection, so ordered.
    [The information follows:]
    
    [GRAPHIC] [TIFF OMITTED] 
    
    Mr. Shuster. And with that, I will start with Mr. Murin.

  TESTIMONY OF KENNETH MURIN, ENVIRONMENTAL PROGRAM MANAGER, 
  DIVISION OF WETLANDS, ENCROACHMENT AND TRAINING, BUREAU OF 
WATERWAYS, ENGINEERING AND WETLANDS, PENNSYLVANIA DEPARTMENT OF 
    ENVIRONMENTAL PROTECTION; DAVID SPIGELMYER, PRESIDENT, 
   MARCELLUS SHALE COALITION; TONYA WINKLER, AICP, MIDSTREAM 
 PERMITTING AND COMPLIANCE MANAGER, RICE ENERGY, INC.; WARREN 
  PETER, FOUNDER AND PRESIDENT, WARREN PETER CONSTRUCTION, ON 
     BEHALF OF THE INDIANA-ARMSTRONG BUILDERS ASSOCIATION, 
PENNSYLVANIA BUILDERS ASSOCIATION, AND NATIONAL ASSOCIATION OF 
HOME BUILDERS; THOMAS R. NAGLE, JR., PRESIDENT, CAMBRIA COUNTY 
  FARM BUREAU, ON BEHALF OF THE PENNSYLVANIA FARM BUREAU; AND 
  JACQUELINE FIDLER, MANAGER, ENVIRONMENTAL RESOURCES, CONSOL 
                          ENERGY, INC.

    Mr. Murin. Thank you, Chairman Shuster. Thanks again for 
inviting the Department of Environmental Protection here this 
morning to provide testimony before the Committee on 
Transportation and Infrastructure on Pennsylvania's program for 
issuing permits for projects under a consolidated permitting 
process, and more specifically, for oil and gas pipeline 
projects.
    Before providing details on the process, I would like to 
address another recent Federal matter that may be impacting 
Pennsylvania permitting activities. Last week the Environmental 
Protection Agency, EPA, and the United States Army Corps of 
Engineers, or the Corps as I'll refer to, published a proposed 
rule regarding the definition of waters of the United States. 
This definition is to be used in determining the jurisdiction 
of the Clean Water Act with respect to the requirements for 
permits under section 404 as well as other Federal Clean Water 
Act programs.
    As the publication of the rule is recent and the rule is 
lengthy, the Department has not yet completed its review of the 
proposal. However, as Pennsylvania is home to over 86,000 miles 
of streams and rivers, and 404,000 acres of fresh water 
wetlands, DEP feels that this proposed rule may be particularly 
relevant to Pennsylvania and fully anticipates providing formal 
comments to EPA.
    Prior to finalization of the waters in the United States 
rule, DEP recommends the EPA and the Corps of Engineers reach 
out to Pennsylvania to discuss the comments provided by the 
Department. Once completed, DEP can provide these comments to 
the committee members and make them available to the public as 
well. Due to our ongoing review and our planned stakeholder 
outreach I will not be providing testimony on that proposed 
rule today.
    The Commonwealth of Pennsylvania is a water-rich State and 
the protection of these abundant water resources is vital to 
the health and the vitality of the Pennsylvania citizens' 
environment and economy. Pennsylvania has a vast energy 
portfolio, ranking second in the Nation, in natural gas 
production and fourth in the Nation in coal production. 
Pennsylvania is the only producer in the Nation of high-heat 
anthracite coal. The role of the Department of Environmental 
Protection is to ensure environmentally responsible development 
of the Commonwealth's vast energy resources, which includes 
protection of the equally abundant fresh water resources.
    In Pennsylvania, the Dam Safety Encroachments Act and the 
accompanying regulations found at 25 PA Code, chapter 105, 
require permits for stream and wetland encroachments 
complimentary to those required under section 404 of the 
Federal Clean Water Act. Under Federal regulations the Corps 
has the flexibility to develop general permits on a statewide, 
regional or national basis. The Department has worked with the 
Corps to develop a joint permitting process that consolidates 
the State and Federal permitting process making it more 
efficient and less time-consuming without sacrificing 
environmental protection.
    In 1995 the Department and the Corps negotiated a statewide 
general permit, State Programmatic General Permit, or SPGP-1, 
for projects in Pennsylvania that impacted one acre or less of 
waters of the United States, including wetlands. Projects with 
greater impact cannot be authorized under this permit and were 
required to obtain the individual section 404 permit directly 
from the Corps. The Corps first issued its Pennsylvania State 
Programmatic General Permit on March 1, 1995. This general 
permit is renewed every 5 years, with the most recent renewal 
or the fourth generation, also known as SPGP-4, having been 
issued on July 1, 2011.
    During the review process that led to the most recent 
renewal of SPGP-4, the Corps' interpretation and application of 
several terms, concepts and definitions used in the permit, as 
they relate it to pipeline projects, were modified. 
Specifically, these changes were intended to provide 
clarification of the process of permitting pipeline projects. 
Prior to the issuance of SPGP-4 in July 2011 the Department, in 
cooperation with the Pennsylvania representatives to Congress, 
attempted to negotiate some changes to the Corps' 
clarifications; ultimately, however, the Corps did not make the 
changes recommended by the Department and the Pennsylvania 
congressional representatives. This is noteworthy as DEP will 
begin the process of negotiating the next permit renewal with 
the Corps next year, which is 2015, in order to have the SPGP-5 
in place by July 1, 2016.
    Under SPGP-4 the Corps defined three broad categories of 
impacts. Category 1 and 2 activities normally do not trigger 
any additional review by the Corps and authorize when a 
department provides State law approval. Category 3 activities, 
however, are reviewed by the Corps as well as the State, and 
some examples of projects that require the Corps' review 
include projects with impacts that threaten endangered species, 
impact more than one acre of wetland, impact more than 250 
linear feet of stream. Recent data provided by the Corps 
indicates that approximately 13 percent of the projects 
authorized from 2011 to 2013 require concurrent review by DEP 
and the Corps. Of these projects, approximately 32 percent were 
pipeline projects.
    To provide a perspective in context on the joint permitting 
program, between July 1, 2011, and June 30, 2013, DEP reviewed 
approximately 9,500 authorizations under PA SPGP-4. It is 
important to point out that this statewide general permit 
covers more than just pipelines. It covers many activities 
associated with land development in general, such as culverts, 
small bridges, docks, temporary stream crossings and intake and 
outfall structures.
    During the period of July 1, 2006, through June 30, 2011, 
over 90 percent of the Corps' authorizations were issued in 
less than 60 days from the date of receipt of a complete 
application. From there the review delays, they were typically 
associated with deficient application submissions.
    SPGP-4 has been a critical tool used in consolidating the 
Federal section 404 and State chapter 105 permitting processes 
in Pennsylvania, although it was tailored to allow for one-stop 
authorization of the projects under both section 404 of the 
Federal Clean Water Act and the State chapter 105 regulations. 
PA SPGP-4 is a Corps permit and the Corps controls the extent 
to which a Corps review is necessary.
    Mr. Shuster. If you can just sum up----
    Mr. Murin. OK. How much time do I have?
    Mr. Shuster. About another 30 seconds.
    Mr. Murin. OK. All right.
    The consolidated State and Federal permitting processes 
under SPGP have been effective, allows environmental 
responsible development of the Commonwealth's vast energy 
resources. As we look to the upcoming renewal of the State 
Programmatic General Permit in 2016 the Department is 
optimistic that working together with the Corps we will be able 
to reevaluate the requirements of Nationwide Permit 12 and the 
State Programmatic General Permit with regard to the use of 
certain critical terms/definitions that bring in greater 
consistency and efficiency into the implementation of these 
important Clean Water Act requirements.
    Thank you for your interest regarding this issue and 
opportunity for the Department to provide this testimony.
    Mr. Shuster. Thank you, and your testimony is--we have it 
full in the record here and we are going to get into some 
questions and we will talk to you about some of those issues.
    Mr. Murin. OK. Thank you.
    Mr. Shuster. And with that, Mr. Spigelmyer.
    Mr. Spigelmyer. Good morning, Chairman Shuster, 
distinguished members of the House Committee on Transportation 
and Infrastructure. My name is Dave Spigelmyer. I am the 
president of the Pittsburgh-based Marcellus Shale Coalition, a 
trade association representing some 300-some producer pipeline 
and supply chain members. Our members represent the largest and 
most active companies producing, gathering and transporting 
more than 95 percent of the natural gas now being produced here 
in the region in the Commonwealth of Pennsylvania. You have a 
copy of my formal testimony which I will summarize this morning 
in my comments.
    Increased development of natural gas here in the region has 
made game-changing contributions to our economy, our energy 
security, and due to the increased use of natural gas, EPA has 
reported that we have significantly reduced carbon dioxide 
emissions in the region, bettering our environment. We have 
done so well reducing energy costs for nearly every citizen in 
the United States. In 2008 prices of natural gas at the well 
had hit $13.71 per Mcf, or thousand cubic feet. After a nearly 
record-cold winter here in the Northeast this year our well had 
prices and delivered utility prices are less than half of what 
they were just 6 years ago. In 2008 our vertical drilling 
conventional industry produced 25 percent of the natural gas we 
consume here in the Commonwealth. Today, unconventional 
horizontal development accounts for more than 14.3 billion 
cubic feet of production per day, equaling 5.2 trillion cubic 
feet annually or more than 20 percent of America's natural gas 
demand being developed right here in our backyard.
    These contributions are huge in terms of change in our 
national energy picture, and putting men and women to work 
right here in the Commonwealth of Pennsylvania. According to 
the Department of Labor and Industry here in Pennsylvania more 
than 241,000 people in Pennsylvania are now employed either 
directly or indirectly by our industry. One great aspect of 
this work is that we can employ men and women right here at 
home trade in a hard hat in Pennsylvania--trade in a helmet and 
military uniform abroad for a hard hat here in the 
Commonwealth. And with nearly every consumer product, all 
steel, glass, plastics, chemicals, fertilizers and powdered 
metals that we touch today being manufactured through the use 
of natural gas, we believe that abundant, affordable and 
reliable supplies of natural gas are poised to open up huge new 
manufacturing opportunities here in Pennsylvania and likely all 
over this Nation.
    However, a critical in--shale development, including the 
Marcellus and Utica Plains, is the requirement to gather and 
transport natural gas to consumers. Predictable and consistent 
authorization in the permitting process for pipelines is 
critical if the benefits of shale development are to continue 
in our region. Today, hundreds of completed wells await a 
pipeline connection to transport that gas to consumers here in 
Pennsylvania and throughout the region. Wells that are unable 
to be tied into a pipeline slows the delivery of that product 
to market, and slows the royalty revenues that would flow to 
mineral owners across the State.
    The primary reason for the delay is that approving pipeline 
projects rests in the review process now embraced by the 
Baltimore District of the U.S. Army Corps of Engineers. Federal 
jurisdiction applies to these projects in the location where 
pipelines cross the waters of the United States, pursuant to 
section 404 of the Clean Water Act. In Pennsylvania, 
authorization of these projects typically has been provided 
under the State Programmatic General Permit, issued pursuant 
with the Clean Water Act, section 404(e).
    The Pennsylvania State Programmatic General Permit #4 was 
reissued effective July 1, 2011, by the Baltimore District of 
the U.S. Army Corps of Engineers. As a result of this change by 
the Baltimore District, the requirements for a review embodied 
in the State Programmatic General Permit have created an 
inefficient process that is now duplicative of the State's 
review. Today, the process being followed by the Baltimore 
District of the U.S. Army Corps requires nearly all pipeline 
projects, both large and small, to undergo individual review by 
the Corps, reviewing the total impacts of a project, and not 
just the individual water crossing being authorized.
    The approach for project authorization for these type of 
projects reflected in the State Programmatic General Permit is 
inconsistent with the goal--of the Corps' own goal, 
inconsistent with its regulation, and represents a marked 
departure from the longstanding approach of evaluating each 
water crossing individually, which leads to substantial 
permitting delays.
    Combining the total impacts of an overall project for 
preauthorization review of each individual water crossing is 
also inconsistent with the Corps' definition of a single and 
complete project, and is inconsistent with the rationale 
expressed by the Corps when it adopted this review process. No 
other district in the Army Corps where our members operate 
approaches the permitting function for gathering lines and 
midstream pipelines in the manner now in place in Pennsylvania.
    In all other areas of the country where gathering lines are 
being built, the Corps adheres to its regulatory definition of 
single and complete, and evaluates each crossing of water 
individually. The adherence by other Army Corps districts to 
the regulatory definition of a single and complete project is 
in accord with the Corps' own rules, and allows for efficient 
and effective review of those projects. Furthermore, the review 
by the Baltimore District of the Army Corps, under the State 
Programmatic General Permit, does not alter the manner in which 
these projects are designed or constructed.
    Their review of these projects is unnecessary, it is 
duplicative, and it does not provide meaningful environmental 
benefit, yet the Army Corps process imposes substantial 
administrative burden, adds additional costs, and significant 
delays that could be eliminated. The delays being experienced 
in Pennsylvania erode our competitive standing as a location to 
invest capital, and can impact the job growth that has 
revitalized communities all across this Commonwealth.
    I appreciate the opportunity to appear before you today, 
and thank you for allowing me to testify. I welcome your 
questions.
    Mr. Shuster. Thank you very much. And with that, Ms. 
Winkler, you may proceed.
    Ms. Winkler. Good morning, gentlemen. I am Tonya Winkler. I 
am the midstream permitting and compliance manager for Rice 
Energy, Inc. Rice Energy is engaged--it is not on. There we go. 
I will borrow this one. Start over.
    Good morning, gentlemen. I am Tonya Winkler, midstream 
permitting and compliance manager for Rice Energy, Inc. Rice 
Energy is engaged in exploration and production of natural gas 
wells, and gathering and transportation of natural gas from our 
wells to our sales points, as well as installation and 
operation of water transfer lines for the use in production of 
our natural gas wells in Pennsylvania and Ohio.
    Rice Energy currently owns and operates approximately 40 
miles of natural gas gathering lines, with a proposed 110 miles 
to construct in the next year. Additionally, we currently 
operate 33 miles of water transfer lines, with a proposed 73 
miles to construct in the next year. An integral part of that 
successful development of both the Marcellus and the Utica 
Plains is the construction of that midstream infrastructure. 
Consistent and timely authorization of these pipelines, as we 
propose them, and other midstream projects is vital to ensure 
that these constructions proceed as planned, on schedule, and 
within our budgets.
    Rice Energy currently has millions of cubic feet of natural 
gas waiting to flow to market, estimated $56 million this year 
alone in lost revenue, just due to orphaned wells. Uncertain 
permitting review times and delays resulting in that lost 
revenue not only for Rice Energy, but loss of royalties for our 
landowners, loss of jobs, both for our midstream construction, 
as well as our oil and gas--or our drilling operations, loss of 
tax base for local, State, and Federal Government agencies as 
well.
    The delays that Rice Energy has experienced throughout the 
review process is not just isolated issues. For example, our 
midstream and completions team work together and collaborate 
methods to utilize water transfer lines for various stages of 
our operations, but the untimely authorization process has led 
to stalled progress more often than not. The company now has 18 
wells in inventory, with no pipeline installed to transport the 
water necessary for production, or to produce this gas and get 
it to market in Pennsylvania. These unanticipated delays in 
completions have resulted in the loss of millions of dollars 
over an operating year, in addition to the $56 million stated 
above.
    As recent--as a recent of--I apologize. As a result of 
these unpredictable delays, Rice Energy has now started to 
focus our operations elsewhere, where permit review times are a 
little more predictable, such as in Ohio, that is--Nationwide 
Permit 12 review process. As an example of what we--our 
permitting reviews in Pennsylvania, we presently have 85 
percent of our midstream projects that are under DEP review 
also going under Corps review for the total impacts of the 
overall project, rather than the limited impact of an 
individual cross that is being authorized.
    This does lead to regular, substantial delays in 
authorization of our projects, and is hindering the ability of 
Rice Energy to develop and construct our infrastructure 
necessary to collect, gather, and transport this gas into 
market. Using recent data, Rice Energy estimates it takes an 
average of 80 days for projects that have only minimal and 
temporary impacts to waters of the United States to receive 
approval. Based upon our experience, it now takes at least 1\1/
2\ or more years to get even the most basic midstream 
infrastructure pipeline project into sales.
    Rice Energy is wholly committed to working with the local, 
county, State, and Federal Government officials and regulators 
to facilitate our safe, responsible installation of natural gas 
gathering lines and water transfer lines, both in Pennsylvania, 
and in Ohio. However, the delays and increased costs in 
connecting these producing wells into market will continue, and 
does influence Rice Energy's strategy for future development. 
The loss of development relates not only to our wells already 
completed and produced, but also for future wells yet to be 
drilled.
    I thank you for the opportunity that you gave me today to 
speak to you, and I look forward to answering any of your 
questions. Thank you.
    Mr. Shuster. Thank you very much. Mr. Peter, proceed. It is 
working.
    Mr. Peter. Thank you, Chairman Shuster, and thank you, 
members of the committee, for allowing me to testify here 
today. Again, my name is Warren Peter. I am founder and 
president of Warren Peter Construction. I am located in 
Indiana, Pennsylvania. I am also here on behalf of the Builders 
Associations, national and Pennsylvania, and our local 
association.
    Home builders have been advocates for Clean Water Act since 
its inception. We have a responsibility to protect the 
environment, and it is a responsibility I know well, for, under 
the Clean Water Act, I must obtain permits for building 
projects. When it comes to Federal regulatory requirements, 
what I desire, as a small business owner, is a permitting 
scheme that is consistent, timely, and focused on protecting 
true aquatic resources.
    Landowners have been frustrated with the continued 
uncertainty over the scope of the Clean Water Act over the 
waters of the United States. There is a need for additional 
clarity, and the administration recently proposed a rule 
intended to do just that. Unfortunately, the proposed rule 
falls short. There is no certainty under this proposal, just an 
expansion of the Federal authority. These changes will not even 
improve water quality, as the rule improperly encompasses 
waters that are already regulated at the State level.
    The rule would establish broader definitions of existing 
regulatory categories, such as tributaries, and regulates new 
areas that are not currently federally regulated, such as 
adjacent non-wetlands, riparian areas, flood plains, and other 
waters. And these changes are far-reaching, affected all Clean 
Water Act programs, but provide no additional protection, for 
most of these areas already comfortably rest under State and 
local authority.
    I am also concerned that the terms are overly broad, giving 
the agencies broad authority to interpret them. I need to know 
the rules. I can't play a guessing game of ``is it 
jurisdictional?'' We don't need a set of new, vague, and 
convoluted definitions. Under the Clean Water Act, Congress 
intended to create a partnership between the Federal agencies 
and State governments to protect our Nation's water resources.
    There is a point where Federal authority ends and State 
authority begins, and the Supreme Court has twice affirmed that 
the Clean Water Act places limits on Federal authority over 
waters, and the States do regulate the waters under their 
jurisdiction. In Pennsylvania, wetlands have been regulated 
under State law since 1980. Since that time, Pennsylvania has 
set an annual gain of wetland acreage. Pennsylvania takes its 
responsibility to protect its natural resources seriously. I 
also believe that Pennsylvania's story is not unique. If you 
look around the country, you will find many other States are 
protecting their natural resources more aggressively since the 
passage of the Clean Water Act in 1972.
    The proposed rule will have significant impacts on my 
business. Construction projects rely on efficient, timely, and 
consistent permitting procedures and review processes under 
Clean Water Act programs. An onerous permitting process could 
delay projects, which leads to greater risks and higher costs. 
Also, more Federal permitting actions will trigger additional 
statutory reviews by outside agencies under laws including the 
Endangered Species Act, the National Historic Preservation Act, 
and National Environmental Policy Act. It is doubtful the 
agencies will be equipped to handle this inflow of additional 
permitting requests.
    I am uncertain of what environmental benefits are gained by 
this paperwork, but I am certain of the massive delays in 
permitting that will result. The cost of obtaining a Clean 
Water Act permit ranges from $28,915 to $271,956. Permitting 
delays will only increase these costs and prevent me from 
expanding my business and hiring more employees.
    The agencies have not considered the unintended 
consequences of this rule. Under this proposed rule, low-impact 
development stormwater controls could be federally 
jurisdictional. Many builders voluntarily select LID controls, 
such as rain gardens and swales, for the general benefit of 
their communities. This rule would discourage these voluntary 
projects if they required Federal permits.
    This proposed rule does not add new protections for our 
Nation's water resources. It just shifts the regulatory 
authority from the State to the Federal Government. The 
proposed rule is inconsistent with previous Supreme Court 
Decisions and expands the scope of waters to be federally 
regulated beyond what Congress envisioned. Any final rule 
should be consistent with Supreme Court Decisions, provide 
understandable definitions, and preserve the partnership 
between all levels of government. All are sorely lacking here.
    And, again, thank you for the opportunity to testify today. 
I look forward to any questions.
    Mr. Shuster. Thank you very much. And with that, Mr. Nagle, 
proceed.
    Mr. Nagle. Good morning, Chairman Shuster, and members of 
the committee. I am a cattle and grain farmer in Cameron 
County, Pennsylvania. Clean water is important to all of us, 
but the hearing is not about the water quality. Rather, it is 
about Federal agencies attempting to gain regulatory control 
over the land use, and using the claim clean water.
    Federal Clean Act--Water Act was signed into law before I 
was even born, but some have been saying--trying to claim power 
that the 1972 law never intended it to give. Farmers are 
straightforward people who believe the words mean something. 
Those of us in agriculture believe that the authors of the 
Clean Water Act include the term navigable for a reason, and, 
you know, as the Supreme Court case--have said that the Federal 
Government can only regulate navigable waters.
    However, recent proposals released by EPA and the Army 
Corps gives conflicting messages. It also seems it is trying to 
gain control over additional water bodies and lands that they 
touch. Just because homeowners' lawns, or farm fields, or a 
school playground collects water after rain does not mean that 
they should be regulated under waters of the United States, but 
from the--what I understand, the regulatory proposal would do 
exactly that.
    EPA has stated that farmers are exempt from the proposed 
rule, and nothing will change, yet they also state that the 
rule will extend Federal regulations to most seasonal and 
rain--seasonal rain depending streams. This is confusing. It is 
my understanding that there are no protection in this proposal 
for common farming activities, and exemptions are available 
only for farmers continuing since--farming practices since 
1977. Since I was born in 1979, does this mean the exemptions 
do not apply to me?
    What if ultimate effect of the rule prevents farmers from 
passing their operations to their children, or prevents young 
people like myself from becoming farmers? By expanding the 
regulation to rain dependent streams, EPA could regulate new 
areas, like dry land. What if the expansion leads to new 
regulations, or eliminates common accepted farm practices? What 
would it require for the permit to control--for permits to 
control pests or mowed grass across a ditch? There is not 
guarantee that such permits would be issued, or even evidence 
that stopping these activities would have any real effect on 
water quality.
    States like Pennsylvania already have significant laws, and 
regulations, and programs in practice--in place to protect 
water considered unregulated, including intermittent streams. 
My written testimony identifies many of them. What's more, our 
State DEP official can show that water quality improvements for 
many of the State-driven and State-administered programs, and 
what if expanded Federal regulation harms the State's ability 
to continue to improve upon successful initiatives? I am 
seriously concerned about the proposal, and its 370-page 
document, and full compliance. I--and if I misunderstand the 
regulation, I could be fined $37,500 per day. That is a pretty 
scary thought for a producer like myself.
    Over the next 90 days farmers like myself will be hard at 
work in the fields, and at least the agency should extend the 
comment period to 180 days to allow farmers to fully access how 
the rule will impact our business, so we can provide proper 
feedback. It would even be better if Congress took action in--
it would even be better that if Congress took action--in 1972, 
Congress proposed to limit EPA authority to navigable waters, 
and in 2010 Congress rejected the legislation proposal that 
would do--that EPA now is attempting to do.
    I hope that Congress will help the--help farmers convince 
the agencies to ditch the rule. And thank you for the 
opportunity to testify today, and I will answer any questions. 
Thank you.
    Mr. Shuster. Thank you very much. Ms. Fidler, proceed.
    Ms. Fidler. Thank you. On behalf of CONSOL Energy--thank 
you. On behalf of CONSOL Energy, a leading diversified energy 
company headquartered in the Appalachian Basin, and CNX Gas 
Company, a subsidiary of CONSOL Energy, we would like to thank 
you for the opportunity to address the committee on the 
proposed rule changing the definition of waters of the United 
States as it applies to the Clean Water Act.
    The proposed rulemaking expands upon the definition of 
jurisdictional waters, and would include waters not 
traditionally covered under the Clean Water Act. The EPA has 
indicated that the intent to of the proposed rule is to 
streamline the decisionmaking process with regards to which 
waters are jurisdictional waters by increasing clarity as to 
the definition of waters of the U.S.
    CONSOL Energy feels that proposed change is unwarranted due 
to current Federal regulation and robust State programs that 
are already in place to protect waters of the U.S. The proposed 
change will absolutely lead to increased permitting review and 
processing time due to the uncertainty of jurisdictionality, 
which will be an undue burden on industry. The expansion of 
jurisdictional waters would have substantial impact across the 
energy industry, and all industries, by requiring permits for 
impacts to otherwise isolated waters, therefore triggering 
additional Federal requirements with little to no environmental 
benefit.
    In September 2013, EPA published their draft ``Connectivity 
of Streams and Wetlands to Downstream Waters'' report. The 
report was used as a building block for expanding the Clean 
Water Act's regulatory jurisdiction, however, this was done 
prior to the Science Advisory Board review of the report. Such 
expansion of jurisdiction should not be based on a report that 
does not address the fundamental question of significance of 
any hydrological connection. The Science Advisory Board has 
published a similar conclusion in their draft review of EPA's 
draft connectivity report.
    In addition to the rivers, streams, and wetlands 
traditionally recognized as waters of the U.S., the proposed 
rule includes a third category, known as riparian areas. The 
isolated resources in riparian areas do not pose a significant 
or direct impact to waters of the U.S.
    The connectivity report also does not fully account for the 
Army Corps of Engineers' ``1987 Wetland Delineation Manual,'' 
which requires three field tests for determining the existence 
of a wetland. The author's selective literature choices led to 
an error in the required wetland determination analysis, 
illustrating that the report was not ready to be finalized when 
the EPA drafted the proposed rule.
    At CONSOL Energy, we pride ourselves on being excellent 
stewards of the environment. Compliance with all regulations 
intended to improve and protect the environment in the areas 
where we operate is one of our top core values. CONSOL Energy's 
environmental standards go above and beyond regulatory 
requirements. In working toward these values, our environmental 
strategy relies on avoidance of jurisdictional waters, as 
currently defined. The proposed rule change would significantly 
limit our ability to avoid newly regulated jurisdictional 
waters. The additional planning, re-training, permitting, and 
mitigation associated with this limitation significantly 
impacts our project lead times and costs.
    To demonstrate these impacts on a coal project, we have 
prepared two exhibits. This first one shows stream resources in 
an impact area as the rule is today. This is a large project 
that is just in the planning and design phase. We haven't had a 
JD completed on it yet. This project as is right now, we are 
impacting 82,000 linear feet of streams. Now, if the rule were 
to be approved, this is how the impact area is increased. And 
this is actually a liberal determination, and we are only 
assuming a 100-foot buffer zone.
    However, if the rule was interpreted in the most 
conservative way, this entire area could be considered wetland 
area, and our impact would be large. Overall, it is an increase 
of 10 percent stream resources, 15 percent wetland resources, 
and an additional 581 acres of this riparian area. It is a 
significant--it has a significant effect on our cost, and we 
are estimating, to mitigate this area, it would add over $10 
million just to this project.
    In closing, CONSOL Energy would like to re-emphasize that 
we do not support the proposed rule changing the definition of 
the waters of the U.S. These changes would lead to considerable 
permitting delays, additional mitigation cost, and a loss in 
our ability to consistently avoid and minimize, while extending 
waters of the U.S. coverage into areas that have no significant 
hydrologic connection to jurisdictional waters. Thank you.
    Mr. Shuster. Well, thank you all. Thank you, Ms. Fidler. 
Just let me start with you, Ms. Fidler. You mentioned this 
project here. You are confident under the current rule, on the 
way you had it laid out in the first slide, that you can 
protect those streams and the quality of water there with what 
you are doing?
    Ms. Fidler. We will impact those streams, and we are--we 
plan on impacting those streams. It is budgeted, it is planned 
for. We will be mitigating in the same watershed as our impact. 
However, when you look at the project, if the proposed rule 
were to be applied, we would still probably complete the 
project, however, it would have to get some really hard--we 
would have to take a really hard look on whether or not we 
would be able to mitigate----
    Mr. Shuster. Right.
    Ms. Fidler [continuing]. Our impact.
    Mr. Shuster. Right. Thank you.
    Ms. Fidler. Um-hum.
    Mr. Shuster. And I think it has been pointed out here by a 
number of you that--especially Mr. Nagle, that this proposed 
rule, there is great uncertainty. You are not sure how it is 
going to be--once it is--if it is implemented, how it will be 
rolled out there by the agency. And so I think good for us to--
for me to start with the question. Mr. Murin pointed out that 
when you did the first Pennsylvania State Programmatic General 
Permit, you said that you put your comments in to the Corps, 
and they didn't pay attention to them. Is that correct? That is 
what your statement said?
    Mr. Murin. Generally, yes. As part of the SPGP process, 
both the Corps and the Department conduct a negotiation. As I 
mentioned, it is an Army Corps permit, but we did have some 
concerns about some of the interpretations----
    Mr. Shuster. Sure.
    Mr. Murin [continuing]. That were being----
    Mr. Shuster. Yeah, but, going back before that, is that 
typical of the Corps of Engineers, or when you are dealing with 
the Federal agency, that they disregard many of your 
suggestions?
    Mr. Murin. I wouldn't say it is typical. I mean, it is a 
negotiated process.
    Mr. Shuster. Sure.
    Mr. Murin. So each time--especially with SPGP, as I 
mentioned, that we are in the fourth iteration of it now, and 
so each time there are some discussions, and some of our 
suggestions are taken, recommendations, sometimes they are not.
    Mr. Shuster. Right. And Mr. Peter and Mr. Nagle, what has 
your experience been in the past? Not looking forward to this 
new rule, because, again, we don't know, you know, what kind of 
impact it is going to have. What has your experience been 
dealing with these different agencies at the Federal level? Has 
it been one that it is ever increasing the burden on you, and--
with getting minimal results?
    Mr. Peter. That is correct. It is always a timely manner, 
you know, and it just delays projects extensively on the time 
factor, which always increases costs. You know, there is not 
speedy correspondence and so on, so it is very timely.
    Mr. Nagle. I have had no personal experience with any--
prior to this ruling coming, because with me--part of becoming 
a farmer, I have not had to experience anything with the EPA, 
so that is why the uncertainty where we go--here.
    Mr. Shuster. And in your daily activities out there on the 
farm, there are times when, what you mentioned about 
playgrounds and your farm, that water will lay somewhere, maybe 
depending on your farming techniques? Is that a big concern of 
yours?
    Mr. Nagle. That is a large concern of mine, because, you 
know, if you have a rainfall that produces, you know, 2 inches 
of rain in 20 minutes, anyone's ground, or especially our 
fields, are going to have some streams, you know, intermittent 
rain streams. And we work with--pretty closely with NRCS now to 
have compliance, as far as conservation plants, nutrient 
management plants, to ensure water safety. You know, we have 
our field conservation strip, a 90-foot strip to prevent 
erosion, so we are pretty much taking all the precautions now. 
And, with further regulations, things could be more difficult 
for us.
    Mr. Shuster. Right. And things like, at a construction 
site, or on a farm, if you get a wet day, and you get ruts from 
your equipment that you don't tend to, that can potentially 
have an unintended consequence of having water lay in it. So 
things as simple as that can have an impact. Is that correct?
    Mr. Nagle. Yes.
    Mr. Peter. Yeah, I would think so. I mean, something as 
small as a very minor tributary that only has water in it when 
you have an excessive amount of rain, if they look at that, you 
know, I mean--and with our topography, especially here in 
Pennsylvania, I mean, we are all hills and valleys, and, you 
know, we get a heavy rain that comes down, it is going to run 
somewhere. You know, it is just a rain shower, but those, you 
know, if they look at those as being protected waterways, just 
a little stream that only happens whenever it rains, or like 
you are saying, a low area, or something in a playground that 
lays water, that could be just detrimental to the construction 
industry, and I am sure to the overall economy.
    Mr. Shuster. Right. It has been my concern that, you know, 
in Washington, DC, we do a one size fits all for everything, 
and that somebody tells these bureaucrats in Washington that, 
you know, the Pennsylvanians don't love their land. I look 
here, everybody here is drinking--everybody here drank, I 
think, Pennsylvania water this morning, and we all care about 
water quality.
    And for the Federal Government to--it is not just in the 
environment. It is everything we do that happens in Washington, 
that they feel as though we don't love our children enough to 
educate them, we don't love our environment enough to protect 
it. So, again, I have grave concerns that this is going to 
happen, if it does happen, that we will see a never-ending 
rampup of regulations. And, again, a site like this, it is 
going to cost $10 million, potentially more.
    Ms. Winkler, your experience has been with the stream 
crossings, it increases the cost of your doing business?
    Ms. Winkler. It does significantly increase our costs, not 
only in additional permitting, but in the delays, which has 
been mentioned before, which increases total project costs 
overall. Not just in construction, but in just delay in getting 
gas in to market.
    Mr. Shuster. Right. Thank you. And with that, I will yield 
to Mr. Gibbs for some questions. We will probably have two 
rounds of questions.
    Mr. Gibbs. Thank you, Mr. Chairman. Mr. Murin, I am, you 
know, earlier this month, a few weeks ago, Secretary Darcy, the 
Secretary of Army Corps-Civil Works for my subcommittee, and--
we talked about this proposed rule. And, you know, I kind of 
tend to almost interpret, maybe the general public might too, 
that by them putting out this proposed rule, they are implying 
that States aren't doing their job.
    And I would first like you to comment on that, but, I am 
concerned, you know, Mr. Peter made some good comments about, 
you know, consistency, timely--delay--possibly delay permit--
further. You know, as Chairman Shuster said, one-size-fits-all 
policy on Washington. Can you just kind of expand on what your 
thinking is? Is there really a need for the U.S. EPA and the 
Army Corps to expand their scope of jurisdiction, you know, how 
that applies to, you know, the job you are doing here in 
Pennsylvania as a State regulator?
    Mr. Murin. OK. Yeah, I--at this point in time, as I 
mentioned in the testimony, is that we haven't had a chance 
review the proposed rule yet, so, as far--it might be a little 
premature to anticipate what maybe the Corps or EPA is 
proposing. But at least currently, under the current rule, we 
see it as working pretty effectively, for the most part. 
Certainly, as I testified, that there are some anomalies as it 
deals with--especially the pipeline projects, and how certain 
definitions are interpreted, what the procedures are.
    But from Pennsylvania's standpoint, we are looking for that 
efficiency. We want to have a consistent viewpoint. Anything 
that the State can certainly handle at the local--at the State 
level, or at the local level, that is something that we would 
like to promote. Certainly there are some differences. There 
will probably always be some differences because of the 
different legal authorities. But, from a State perspective, 
seems like things were--are working, for most part, pretty 
well.
    Mr. Gibbs. Does--to build on that a little bit more, I have 
heard some, I think, testimony today about the Baltimore 
District of the Army Corps, and it talks about the individual 
stream crossings, the pipelines. Is Baltimore District doing 
something different here in Pennsylvania than the rest of the 
districts around the country are doing, you know, in regards to 
the permitting process?
    Mr. Murin. Overall in Pennsylvania, not just the Baltimore 
District--there are three Corps districts in Pennsylvania, 
Pittsburgh, Baltimore, and Philadelphia. And the Baltimore 
Corps District is the lead district, so it helps coordinate 
activities statewide. It is different from the standpoint that 
we do have the SPGP process. Some other States do rely upon the 
Nationwide Permit, the Nationwide Permit 12, as I mentioned, 
and some other folks that had testified as well. So, from that 
standpoint, there are some differences. I believe there are 
about 20 States around the country that have a SPGP process, 
rather than relying upon the Nationwide Permit.
    Mr. Gibbs. All right. OK. Thank you. Mr. Nagle, a couple 
weeks ago, in Ag Committee, we had Secretary Vilsack before the 
committee, and I asked the Secretary if normal farming 
operations would be exempt under the rule, and he said 
absolutely. But then he had 52, I think it was, specific 
exemptions especially for dealing with the NRCS, the Natural 
Resources Conservation Services, farmers. Do you have any 
thoughts about why they would have to have a list of exempted 
rules if they think the rule--all farming opportunities are 
exempt?
    Mr. Nagle. Yeah, I don't know why they would have all 
farming exempt. I don't know why they would have a list of 
exemptions that would have to do with our current thing with 
NRCS, technically involved with crop insurance, and things like 
that. We have to be in compliance with NRCS. So I would think, 
as a whole, generally, most farmers are already in compliance, 
so it kind of alarms me that they are asking for additional 
exemptions, if they are exempt. So that is kind of the problem 
that we--and I have, is the cloudiness of it.
    Mr. Gibbs. Yeah, I am really concerned about it too, 
because they make the statement that normal farming practices 
are exempt, but then they produce this list of specifics, and I 
don't really know the necessity of that. And I also would be 
concerned, you know, just--I believe that this administration 
thinks that they already have jurisdiction of all waters of the 
United States, and then--State sovereignty issues are really 
concerning to me. I am going to yield back to the chairman, but 
we will do another round. Thank you.
    Mr. Shuster. Thank you, Mr. Gibbs. Like you say, we will 
have a second round. Now yield to Mr. Denham, chairman of the 
Subcommittee on Railroads, Pipelines, and Hazardous Materials, 
and he also happens to be a farmer from California, so he knows 
these issues that we have been talking about here today very, 
very well. So, with that, I yield to Mr. Denham.
    Mr. Denham. Thank you, Chairman Shuster. Ms. Fidler, 
looking at your map over here, what type of boats go on these 
different waterways here? Do you have any vessels that go on 
those?
    Ms. Fidler. None that I am aware of.
    Mr. Denham. No?
    Ms. Fidler. No.
    Mr. Denham. No boats? So----
    Ms. Fidler. These are very small----
    Mr. Denham. You----
    Ms. Fidler. It is a very small stream.
    Mr. Denham. Could you even put a canoe, and maybe--put a 
paddle in the water, and----
    Ms. Fidler. Not even after a large rain event.
    Mr. Denham. So not navigable by any means?
    Ms. Fidler. Not in my opinion.
    Mr. Denham. Do they ebb and flow with the tide? Does the 
tide create any movement in these?
    Ms. Fidler. No, sir.
    Mr. Denham. How about interstate or foreign commerce? Do 
you have any vessels that go through those that create commerce 
in the local area?
    Ms. Fidler. We do not.
    Mr. Denham. Thank you. Now, obviously I asked those 
questions, because that is why the Clean Water Act was set up, 
from a national perspective. Mr. Murin, in California we have a 
State Water Board, and that State Water Board, has a great deal 
of regulatory authority over our farms, our water that comes 
off of our farms, certainly all of our different waterways. Do 
you have something similar here in Pennsylvania?
    Mr. Murin. Not that I am aware of, no.
    Mr. Denham. So do you have any regulations over your local 
and State water usage?
    Mr. Murin. Yes, yes, we do, and the Department of 
Environmental Protection has the laws and regulations that we 
implement.
    Mr. Denham. And do you feel the need to have greater 
regulation, from a Federal perspective, or is Pennsylvania 
getting the job done currently?
    Mr. Murin. I believe that we are getting the job done 
currently, based upon the implementation of our laws and 
regulations.
    Mr. Denham. So moving the standard from navigable waters, 
which obviously these are not navigable waters, to 
jurisdictional waters, waters of the United States, how is that 
going to adversely affected your regulatory authority?
    Mr. Murin. I don't know if I can answer that right now. As 
I said, we haven't fully--or fully reviewed the proposed rule. 
I think, from Pennsylvania's perspective, based upon the 
definitions that we have, for what we regulate under our Acts 
and our regulation, that we pretty much have all those waters 
already covered.
    Mr. Denham. To what size? What size of water are you 
regulating?
    Mr. Murin. It is--it doesn't regulate as far as size. I 
mean, all wetlands are regulated in Pennsylvania. Under the 
Clean Streams Law, we do have regulation over all waters that 
are defined in the Clean Streams Law. Streams, creeks, 
rivulets, dammed water, ponds, it goes on. Under the chapter 
105 regulations, as far as streams, it is pretty much 
everything that has a defined bed and bank, to keep it simple.
    Mr. Denham. A bed and bank, meaning?
    Mr. Murin. A bed of a stream with an established bank. 
There is a difference in elevation between where the stream 
flows and the bank.
    Mr. Denham. But a pond as well? You would have regulatory 
authority over a pond?
    Mr. Murin. We do have some regulatory authority over that, 
certainly in the Clean Streams Law, and then from the Dam 
Safety Encroachments Act and chapter 105; it would depend on 
certain factors.
    Mr. Denham. And this new jurisdictional--what I would 
consider an overreach would not only regulate everything that 
you have described, but even go further to mud hole, puddle? I 
mean, this becomes a land use policy, as well as just water 
use, would you agree?
    Mr. Murin. If it is--if the--if it is as you described, it 
would expand it from that perspective.
    Mr. Denham. Thank you. Mr. Chairman, my time has about 
expired. I will yield back.
    Mr. Shuster. Thank you. And, with that, go to Mr. Perry for 
questions.
    Mr. Perry. Thanks, Mr. Chairman. Mr. Murin, I am trying to 
figure out, and it seems that you would be the best person on 
this panel, maybe, to enlighten us as to what tangible clean 
water benefits, what water quality benefits, will be realized 
if this rule is enacted?
    Mr. Murin. Again, I am not sure the specifics of what is 
proposed, but based upon what is existing, certainly the 
tangible benefits are protecting wetlands----
    Mr. Perry. I know what is existing. I am----
    Mr. Murin. Yeah.
    Mr. Perry [continuing]. Talking about what is proposed.
    Mr. Murin. Yeah. And I can't----
    Mr. Perry. OK. All right.
    Mr. Murin. I am sorry, at this time I can't----
    Mr. Perry. All right. So would--based on what we think is 
proposed, if Mr. Nagle drove his tractor through a field, and 
there was, you know, there had been a rain maybe a week before, 
and there is a portion of it that is a little lower, but he is 
trying to get his crops in or out, maybe he gets a little close 
to it and leaves a ditch. Maybe he has to pull his tractor out 
with another tractor because he gets it mired into the axle, 
and--so on and so forth, leaves a ditch, can't repair the ditch 
for some time because it is muddy. Ditch fills up with rain, 
with water. Is that now, under the current--or under the 
proposed rule under the jurisdiction?
    Mr. Murin. Again, I don't know. As far as--if there is no 
change to what is defined as far as a wetland, the wetland area 
would have to have the soils, the hydrology, and the plant 
community----
    Mr. Perry. It says ephemeral bodies of water.
    Mr. Murin. Yeah.
    Mr. Perry. Is that--would that be considered ephemeral?
    Mr. Murin. No.
    Mr. Perry. It is transient, it is not permanent, but there 
is water in it. What would the length of it have to be for it 
to be ephemeral?
    Mr. Murin. I think there would have to be connectivity to 
other----
    Mr. Perry. So if it was a low-lying area----
    Mr. Murin. Yeah.
    Mr. Perry [continuing]. That is generally dry, but 
occasionally wet, there is a ditch in it with water in it now, 
could the connection be made?
    Mr. Murin. I guess it could.
    Mr. Perry. OK.
    Mr. Murin. Yeah.
    Mr. Perry. Yeah. Point taken. So I have got a swing set in 
my backyard for my kids, and where they swing, you know, their 
feet grind out the dirt. There is much that--I try to put it 
back in and plant it, and so on and so forth, water in it. You 
are saying no, but it is up to--is it--would it be up to 
interpretation?
    Mr. Murin. Yeah, I think that is----
    Mr. Perry. Yeah, that is a problem.
    Mr. Murin [continuing]. When it comes down to----
    Mr. Perry. That is a problem for me.
    Mr. Murin. As far as the Department is concerned, those 
were--would not be areas that we would----
    Mr. Perry. As far as your Department is concerned right 
now.
    Mr. Murin. Right.
    Mr. Perry. However, you have been in a position on many 
occasions to enact things and enforce things foisted upon us by 
the Federal Government, even at your displeasure or 
disagreement. I would cite the Chesapeake Bay strategy, to a 
certain extent, to some of that. But I don't want----
    [Inaudible.]
    Mr. Perry. Let me move on. I want to ask Mr. Spigelmyer a 
question. I have got a narrative here out of the Los Angeles 
Times, 4/26, so this is just a couple days ago, regarding 
energy prices going up for good. And it says, ``The Federal 
Government appears to have underestimated the impact as well. 
An Environmental Protection Agency analysis in 2011 had 
asserted that new regulations would cause few coal plant 
retirements. The forecast on coal plants turned out wrong 
almost immediately, as utilities decided it wasn't economical 
to upgrade their plants, and scheduled them for decommission.''
    In vain--in light of that, in light of increasing prices, 
and in light of, you know, and other statistics in the same 
article, ``Current regulations going into effect next year will 
result in 60 gigawatts of electricity out of the grid, which is 
tantamount to 60 nuclear reactors.'' Based on that, when people 
say, you know, the regulations aren't mattering all that much, 
you gas drillers, you oil people, you can go somewhere else. 
Taxes--you, you know, or no, you can't go--the gas is here. If 
you want the gas and the oil, you have got to get it here. You 
folks in the energy industry, any other options?
    Mr. Spigelmyer. First of all, yeah, Congressman, let me 
come back to the point that you made about electric power 
choice, and costs there. In 2007, 2008, the Public Utility 
Commission and the Commonwealth were actively talking to 
consumers across the--about the rate caps coming off, and power 
rates going up dramatically. At the same time, we were 
producing, you know, ample supplies of natural gas, and growing 
that supply rapidly through horizontal unconventional 
development.
    Prices dropped fairly rapidly. Power choice was made. Many 
of the generators in the Commonwealth, and this region, moved 
to natural gas, saving consumers billions from where we were 
going to be with rate caps coming off. Certainly added 
uncertainty with regulatory--with a regulatory environment. 
Added costs across the power generation sector will have an 
impact on price, no doubt about that.
    Mr. Perry. Mr. Chairman, with your indulgence, just want to 
draw the thread. What I am trying to show and illustrate is 
that Mr. Murin, who is from the DEP, and this is his expertise, 
although he has, you know, he is not representing the Federal 
Government, the EPA, in this regard, but he is going to be 
the--they are going to be the agency that has to enforce a lot 
of this stuff in the State, and any other State, their--
tantamount agencies would do the same thing, could quantify 
very little value in this regulation.
    And the other side of the equation, whether you are in the 
farming industry, or whether--energy industry, additional 
regulation is going to cause significant tangible problems, 
especially in the energy industry, where there is a lack of 
power, especially during peak times, or unexpected things, like 
the polar vortex, or exceptionally hot periods of time, where 
everybody is running their air conditioning, that we are going 
to have blackouts, brownouts, not to mention--notwithstanding 
the increase--the great increase--46 percent is what the 
article says the increases in prices will be. So nearly 50-more 
percent based on nothing else more than these regulations. And 
I yield back.
    Mr. Shuster. Thank the gentleman. Appreciate you making 
those points. With that, Mr. Rice is recognized.
    Mr. Rice. Thank you, Mr. Chairman. Well, at this panel here 
we have got represented food, energy, and construction, and 
regulation. Food, energy, and construction. We are talking 
about a process here that will lengthen the time for 
permitting, make it more difficult, and run up the costs, 
right? I don't know what we are concerned about. We are just 
talking about food and energy, for God's sake. Maybe we are 
overreacting here. Everybody in this room wants to protect the 
environment. This is one more example of Federal overreach. And 
my whole focus in Congress is on American competitiveness and 
jobs, and certainly food cost directly affects that, and 
certainly energy cost directly affects that.
    I believe the current administration thinks we need to be 
off fossil fuels altogether. I think that is their ultimate 
goal, and they want to run up the cost of fossil fuels to the 
point that alternative energy makes sense, because that is the 
only way it makes sense in the current environment. Hey, in the 
long run, I hope we are off fossil fuels eventually. I hope we 
are on alternative fuels. But we are not ready yet, are we? We 
don't have the technology for it. So we have got to keep using 
what we have got.
    And, in my opinion, we should do everything we can to make 
that available, within reason. We need to protect the 
environment. But if we are going to be spending money on fossil 
fuels, we need to be doing it using our resources, I believe, 
and keeping our wealth here, instead of sending it overseas.
    I think that the cost of fuel is a fundamental factor in 
American competitiveness because, on the one hand, we create 
jobs right here using our own fuel, and we also keep our wealth 
here, which--and we create a tax base here, and we can use the 
taxes to build our own infrastructure, and all those things 
factor in competitiveness. But also, by putting these 
additional regulations on, by dragging our feet, not 
necessarily going out and stopping energy exploration, not 
necessarily going and putting up roadblocks to prevent it, but 
just not helping, by the Federal Government not helping with 
it, that we hold costs up.
    The war on coal, I have seen projections cost the average 
consumer $40 a month on their utility bill. When the President 
took office, fuel at the pump was $1.80 a gallon. Now it is 
$3.50 a gallon. Even though those monies don't go to the 
Federal Government, there is still taxes. You still have to 
have the stuff. That is money out of consumers' pockets. That 
consumer spending is two-thirds of the American economy.
    And should we wonder why we have 2.8 percent growth 6 years 
after the Great Recession, should we wonder why we have 6.7 
percent unemployment--who here believes that 6.7 percent is an 
accurate reflection of our unemployment in this Nation? I don't 
either. So--no, I think that this is one more example of the 
administration maybe not putting up direct obstacles to energy 
exploration, but it is a way they could help, a way they are 
dragging their feet. Keystone pipeline, absolute case in point.
    There is a paragraph, Mr.--is Nagle or Nagle?
    Mr. Nagle. Nagle.
    Mr. Rice. Nagle? In your written testimony that I thought 
was great. It says, ``It is extremely difficult for me and my 
fellow farmers to trust the intentions of Federal officials in 
development of this proposed rulemaking, given the history of 
continuous effort of certain Federal agencies to expand their 
power and authority. These Federal agencies have tried to claim 
authority under the Clean Water Act of virtually any land area 
over which a bird flies. Federal agencies have openly tried to 
lobby Congress to remove the word navigable from the Clean 
Water Act. These types of actions make me, and other farmers, 
very doubtful that Federal officials will apply this new volume 
of regulations in a way that is fair or reasonable to us, or 
considerate of our needs and daily challenges.''
    Well, I don't understand your concern. For goodness sake, 
you don't trust the Federal Government? Yeah. Who was it? Was--
I think it was you, Mrs. Winkler. Were you saying that in--
looking at a stream crossing, that the Army Corps now looks at 
the gas flowing through the pipeline, and its effect when it is 
ultimately used? Was that you, or was that you, Mr.--one of you 
was talking about that.
    Ms. Winkler. Go ahead. I think it was you.
    Mr. Rice. Yeah.
    Mr. Spigelmyer. Actually, it wasn't necessarily the gas 
flowing through the pipeline, but taking a look at overall 
impact, rather than the authorized use that we are trying to 
permit.
    Mr. Rice. So there--I know on the Keystone pipeline they 
are looking at the ultimate burning of the fuel, in terms of 
whether or not they are going to approve that pipeline. Are 
they doing that here as well?
    Mr. Spigelmyer. Go ahead.
    Ms. Winkler. In my experience, I haven't noticed that so 
much as--really it has been the State of Pennsylvania to 
discuss about how we--a topic many of us have touched upon 
already. I think the State is doing a good job looking at each 
individual impact of every single stream, be it ephemeral, 
intermittent, or perennial. In my personal experience as a 
consultant, and working at Rice, I have yet to encounter a 
single permit in which the Army Corps comes in an requests 
anything different than what the State is already requesting us 
to do for protection.
    And so, in terms of the material flowing, I haven't noticed 
that they are really looking at that. But in terms of each and 
every individual crossing, the State is already looking at 
that. The Army Corps isn't adding anything but additional time.
    Mr. Rice. My time.
    Mr. Shuster. Thank you. We could talk a little bit more 
about that, and I have been making the case that for the past 
50 years or so the DEP in Pennsylvania has done just that, and 
the Corps just lays that layer over. I think it is Washington 
bureaucracy. Looking at the Marcellus Shale clay sand, there is 
50 years of gas there. That means there is work for us, so that 
is why they put that layer in there. And we have been trying, 
in Congress, to push back on that. Unfortunately, we don't have 
a Senate that is willing to work with us to do that.
    Can you talk about your experience, Pennsylvania versus 
Ohio, when it comes to permitting? Ms. Fidler, you can----
    Ms. Winkler. I think this will work better, thank you. 
Certainly. Rice is actually fairly new to our operations in 
Ohio. We just started within the past year. But what we have 
noticed is our ability to get into the construction phase our 
pipeline projects is incredibly fast. And from the time that we 
are ready to--we are--we start permitting to the time we are in 
construction, we are looking at 45 to 60 days, versus my 
experience in Pennsylvania for a similar type of project, a 
short gathering line, maybe just a couple miles, in 
Pennsylvania I am probably looking, on an average, of about 100 
to 120 days.
    So, again, when you are looking at a cost of doing 
business----
    Mr. Shuster. Time is money.
    Ms. Winkler [continuing]. The exact same--similar type of 
project, Ohio is much faster under the Nationwide Permit 12 
process. And, again, it is the exact same--similar type of 
controls. Rice Energy has actually gone above and beyond what 
Ohio currently requires, and we follow the Pennsylvania DEP 
rules for all our erosion control and sediment controls for our 
pipeline projects in Pennsylvania. But in just--we don't have 
that double layer of regulation. We aren't going through the 
DEP and the Army Corps. We are just going through one agency.
    Mr. Shuster. And the topography, the geology over in----
    Ms. Winkler. Where----
    Mr. Shuster [continuing]. Ohio, is it similar to 
Pennsylvania?
    Ms. Winkler. Where we are operating in Ohio, it is similar 
to Pennsylvania. We are in southeast Ohio, so the same type of 
rolling hill and terrain. Same type of concerns with, you know, 
sediment potentially running downhill. It is just--it is a 
difference of not having to get through as much regulation. 
But, again, you are getting the same type of controls, same 
result in the protection.
    Mr. Shuster. Ms. Fidler, did you have the same experience?
    Ms. Fidler. Yeah, I think we have had the same experience 
as Ms. Winkler has with rights, and--on both the coal and gas 
side of our operations. You know, looking from State to State, 
and our coal operations in West Virginia even, it seems the 
permitting process is more organized, more consistent, and more 
clear. It seems a lot easier. And so, when you are evaluating a 
project, Pennsylvania kind of might land in second or third 
place.
    Mr. Shuster. Right. Mr. Spigelmyer?
    Mr. Spigelmyer. Yeah. Mr. Chairman, due to the activities 
of both you and your office, as well as, you know the House 
Committee on Transportation and Infrastructure, we have seen 
some improvement in delay times at Army Corps. But, that said, 
it is still redundant, it is duplicative, and it is time 
consuming to go through that process with little to no 
environmental benefit----
    Mr. Shuster. Right.
    Mr. Spigelmyer [continuing]. Being achieved. And, as you 
mentioned a moment ago, time is money, and delay is money.
    Mr. Shuster. Right. And, you know, that is the case we have 
been making--Mr. Spigelmyer has been making with your 
coalition. And whenever we bring in people from industry to sit 
across the table from the Corps of Engineers, the natural 
inclination is, because of the fear of the Federal Government, 
is the industry isn't punching hard enough, making their case 
forceful enough, and so we have got to continue to do that.
    And again, you know, I understand, when you see what the 
IRS has done to groups out there, and the fear they have, 
again, coming up against a Government agency, the thought is, 
are they going to delay my permit a couple more days, or a 
couple more weeks, and cost me even more money? But we have got 
to make the case. And I guess Mr. Spigelmyer, you are the heavy 
hand of the industry, to come in and punch back. You have been 
doing a great job of that. But we have got to continue to make 
this case, because when we see this new regulation potentially 
coming out on the waters of the U.S.--I appreciate the fact 
that, Mr. Murin, you haven't fully looked at this. It looks 
like CONSOL is really aggressively looking at it. That is 
because it is going to cost you lots of money, so you are 
looking at it aggressively, but this is the first hearing we 
have had on it.
    The rule only came out formally about a week ago, I guess, 
so Mr. Gibbs, I believe, has announced a hearing on May 8th on 
his Subcommittee on Water Resources and Environment, so I would 
encourage the State of Pennsylvania, DEP, to really come 
forward with your views on this. And we will, of course, be 
urging States across the country and industry that are going to 
be impacted by it. I know that the farmers and the construction 
industry have been looking at it, so again, we want to make 
sure that we get your views, because you are going to be the 
folks that live with this, if it is.
    We are fighting it. We are going to continue to fight it. 
But, you know, it is problematic, and it is--we think it is 
tough now with the stream crossings, I think this will 
probably--Mr. Murin, would you say that if this--although you 
haven't looked at it in depth yet, but--if a reg comes out 
affecting the waters of the U.S., do you think that would 
affect stream crossing permitting in Pennsylvania? Add----
    Mr. Murin. It certainly could. I mean, certainly it is the 
Department's perspective, again, to work with the Corps and the 
EPA to identify how we can best coordinate those activities, 
but--and we put in some policies and procedures ourselves to 
help ensure that that is done at the State level. But certainly 
the unknown is what would be done at the Federal.
    Mr. Shuster. Right. And, Mr. Perry, you mentioned that--is 
it the Los Angeles Times article that said a 46-percent 
increase?
    Mr. Perry. Forty-six.
    Mr. Shuster. And what was the timeframe that they said----
    Mr. Perry. They said, I think, 15 years----
    Mr. Shuster. Fifteen years?
    Mr. Perry [continuing]. Depends on what State you are in.
    Mr. Shuster. And I think that is something we haven't seen 
here. I just had a coal-fired facility in my district close 
down, one next door in Congressman Murphy's district, to two 
coal-fired plants. I think the estimates are, like, 390-some 
coal-fired plants will shut down in the coming years.
    And the American people haven't realized the impact of 
energy costs going up as Mr. Perry quoted there. So that is a 
scary thought, to see that our energy costs are going to go up 
that much in the next decade or so because of these 
regulations.
    With that, I will yield to Mr. Denham for any questions 
that he has. OK. Any--Mr. Gibbs?
    Mr. Gibbs. Thank you, Mr. Chairman. I want to comment, I am 
glad Ohio is competitive. Welcome to Ohio. Come over to Ohio. I 
know we have got a lot of rigs from Pennsylvania there in Ohio 
right now, and you are very much welcome there.
    Mr. Spigelmyer, you know, on your permitting delays, when 
did the Marcellus kind of take off? What--how long has it been 
now?
    Mr. Spigelmyer. The first Marcellus horizontal well was 
drilled in 2004, but real rampup in development began around 
2008, late 2007.
    Mr. Gibbs. How--what--roughly what percentage of current 
wells are shut in because they can't get the connecting----
    Mr. Spigelmyer. It is probably less than 10 percent, but 
close to 10 percent, and that is a pretty significant number 
when you think about the fact we have drilled about 7,000 wells 
in the Commonwealth to date, that have changed the outlook for 
natural gas supply not only for this Commonwealth. We have 
moved from a quarter of the natural gas that we consumed in the 
Commonwealth to being a net exporter, producing 20 percent of 
America's natural gas demand from this region now. That is a 
pretty incredible feat in a short period of time. But when you 
start talking about 10 percent of your wells being shut in 
because of lack of pipeline infrastructure, or the delays 
associated with being able to build that infrastructure, it has 
significant impact on those----
    Mr. Gibbs. Yeah, there is no doubt. I know in Ohio, in 
Utica, we have--it is more wet gas----
    Mr. Spigelmyer. Right.
    Mr. Gibbs [continuing]. And we are building 11 separation 
facilities----
    Mr. Spigelmyer. You bet.
    Mr. Gibbs [continuing]. Currently, and we have to connect 
them all up, and the gathering pipes--the pipelines to--break 
out the ethylene, and all the other wet gases, and dry gas, and 
it was a little different.
    Mr. Spigelmyer. Yeah. We have an interesting situation in 
Pennsylvania, where we have a little bit of both. We have 
probably a world-class dry gas play in the northeastern part of 
the Commonwealth. Some would call it Gucci gas. It is pipeline 
capable gas almost right out of the well. And we have wells in 
northern Pennsylvania that may be the best in the world. 
Southwestern Pennsylvania is under-pressured. It does yield 
heavy hydrocarbons, ethane, pentane, butane, isobutene, 
propane.
    All those liquid streams are there, and our operators are 
active, and need to do that same exact work that you are 
talking about in the eastern area of Ohio, building 
compression, building cryogenic facilities, pipelines, and 
gathering facilities. And we are very hopeful that soon we will 
also have cracking technology available to open up new 
opportunities of manufacturing.
    Mr. Gibbs. I will just open this up to the entire panel, 
but I am really concerned in the proposed nearly 400-page rule, 
which kind of blows me away. I know Secretary Darcy, in my 
committee a couple weeks ago, made the comment about case-by-
case basis. And if you read through that rule, seems like there 
is a lot of discretion by the Feds to define what a tributary 
might be. You know, I think we had some discussion already. It 
could be a road ditch, obviously.
    But does anybody want to--I really want to hear case by 
case, if you talk about inconsistency, and a lack of certainty, 
and--I think we see a little bit here with the Baltimore Corps 
District, versus maybe the Huntington District, when--talk 
about pipeline permitting. Anybody want to expound on that 
case-by-case scenario that they are talking?
    Ms. Winkler. OK. Well, I know, just from my experience, 
Rice is somewhat unique in that our operations in Pennsylvania, 
and our operations in Ohio, are all in the Pittsburgh Corps 
District. So to see the difference between a permit submitted 
in Pennsylvania, and a permit submitted in the--in Ohio, in the 
comments that you--the process is just amazing, even though it 
is going to the same Corps.
    Now, in terms of individual projects, and--I know right now 
in Pennsylvania, if it is a roadside ditch, we are already 
calling it a stream. It is an ephemeral stream. We do that. At 
least in the southwest region, we are required to do that. 
That--I think--really, all we are asking for, as an industry, 
we just want some consistency. You know, I don't necessarily 
agree with having to call a roadside ditch a stream----
    Mr. Gibbs. Yeah, I was just going to say, I would be 
careful with that, but----
    Ms. Winkler. Yeah. But what we are asking for--and I know 
Rice doesn't either, but we just need--all we are asking for is 
just some consistency. If it is a roadside ditch, it is a 
roadside ditch. You know, it is not carrying--it is not 
navigable. You can't put anything on it. It is not carrying any 
large amount of water any one time. And so----
    Mr. Gibbs. I just wanted to ask a quick question----
    Ms. Winkler. Um-hum.
    Mr. Gibbs [continuing]. Of Ms. Fidler. You talk about the 
Science Advisory Committee hasn't reported yet. I brought that 
up with Secretary Darcy, and I got kind of a gray answer. You 
stated in your comments that the report hasn't been put out 
yet, is that correct, and that it is--or it is under review, 
and--but they put the proposed rule out there anyways?
    Ms. Fidler. That is right. The EPA's draft report was put 
out before the Science Advisory Board had an opportunity to 
review it. And right now, on their Web site, the Science 
Advisory Board's review is in a draft form--draft form.
    Mr. Gibbs. OK. Thank you. Thank you, Mr. Chairman.
    Mr. Shuster. Mr. Perry?
    Mr. Perry. Thanks, Mr. Chairman. I am going to start out 
with Ms. Winkler. I understand that no other district of the 
Army Corps approaches the permitting function for gathering 
lines, water transfer lines, and other linear facilities in the 
manner, and with the requirements now in place in Pennsylvania. 
If you are, if you are able to explain, why the difference with 
the Corps, how it treats Pennsylvania, and everybody else?
    Ms. Winkler. Well, I think that is in regards to the PA 
SPGP-4 with the aggregation of all of our impacts. If you are 
in Ohio, each stream of--each stream crossing is considered its 
own individual project.
    Mr. Perry. Same work in Ohio, same work in Pennsylvania.
    Ms. Winkler. Same work----
    Mr. Perry. Why is it treated differently?
    Ms. Winkler. I cannot answer that question for--but I----
    Mr. Perry. OK. Mr. Murin, can you answer----
    Ms. Winkler [continuing]. They do.
    Mr. Perry [continuing]. Answer that question?
    Mr. Murin. I would answer it the same way, that it is in 
the way that the interpretation is of some of the terms.
    Mr. Perry. So the point I want to make is that the Federal 
Government, whether it is the EPA, or the Corps of Engineers, 
or anybody, has the ability to interpret, based on what they 
view, and it can be completely different for one citizen or 
another based on that interpretation, and nothing else. Is 
that--am I right or wrong, based on what you know about the 
Corps' decision in Pennsylvania, versus the neighboring State 
of Ohio, or any other of the 49 States?
    Mr. Murin. My understanding is that the Corps can make 
those regional determinations.
    Mr. Perry. Right. OK. So--and herein lies, you know, the 
problem with giving the blanket authority to the Federal 
Government, whether it is the EPA or the Corps of Engineers. 
Mr. Peter, you build houses, right?
    Mr. Peter. Correct.
    Mr. Perry. So, based on your testimony, and I agree, based 
on what I have read, regarding the proposed rule, the term 
shallow, or shallow subsurface connection, leaves the door 
completely open, and unbounded jurisdiction by the Department, 
or blanket jurisdiction for determination. So you build houses, 
right?
    Mr. Peter. Um-hum.
    Mr. Perry. You buy a piece of ground, you are doing a spec 
home. Maybe you are doing some townhomes, some low-cost housing 
so people can get in the first time. You are working with the 
local zoning commission, the local planning commission. You get 
your stuff in order, and you start building, and it is based on 
a price point for somebody to get in. Maybe a first time 
homeowner like I was at one point, $100,000, $150,000, 
something like that.
    And all of a sudden this subsurface connection, below the 
surface, is made between the ditch your pettibone made putting 
up the roof and the stream a quarter mile away. What does that 
do to your price point? What does that do to your business?
    Mr. Peter. Well, I could see, you know, definitely 
affecting the cost significantly because of it is happening to, 
you know, if they take it into consideration as, you know, as a 
waterway, I mean, to protect that, and----
    Mr. Perry. How will you know about the subsurface 
connection? How do you know?
    Mr. Peter. You don't. I mean, and that is----
    Mr. Perry. How do they know?
    Mr. Peter. Yeah. I don't know what the--I don't know how 
anybody would know what is there.
    Mr. Perry. Well, how can you plan for that when you are 
doing your cost estimate about how much you are going to sell 
that home for to a new time home buyer--first time home buyer?
    Mr. Peter. It would be very difficult to plan for. You 
know, the only thing that you could do----
    Mr. Perry. Wouldn't it be just a guess, like, a hope, that 
I could build it before EPA came in and made the connection?
    Mr. Peter. Right. It is--correct. It is either that, or, as 
I am indicating--some of which is--but sometimes you have to 
look at things and anticipate the worst. And, of course, then 
that increases the cost. And, you know, if that is--comes to 
that point, when you are looking at something like that, you 
may have to build a factor in there if you experience--and, you 
know, a money factor included into your project, which--and 
then, as I say, then, you know, we try to keep housing 
affordable, and that is our goal, all of us. So, if you have to 
do that, you know, and then maybe it wouldn't be used, but 
maybe it would be. But everybody is going to have to build 
something in there in case something like that happens.
    Mr. Perry. OK. Thank you. Mr. Nagle, you know, I think a 
lot of people don't understand the cost of farming when you 
have got a head for a combine costing $100,000, and that 
doesn't include the machine itself, and you need multiple 
heads, you need a corn head, you need a weed head. How does 
this potentially affect--you are--I don't know how anybody 
young gets into farming. You have got to pay a mortgage based 
on crops or animals, and mortgage on land. And I don't know 
what it goes for around here, but where I live, it is pretty 
darn expensive.
    Like, nobody gets into farming. Everybody sells their farm 
for development because they can't afford to, even though they 
may love it. Explain to us how this proposed rule is going to 
affect new people, young people, whether they inherit the farm, 
or whether they want to buy the farm. How is it--how do you see 
it affecting them?
    Mr. Nagle. Probably some of the biggest factors affecting 
is the $37,500 per day fine if you are found on a rule that you 
weren't in compliance that you don't know if you are or you are 
not in compliance. I know myself, and probably most farmers, we 
wouldn't stay in business too long if we were out of compliance 
for 10 or 20 days. I mean, we don't have any--that much 
capital.
    And then as far as the land that we farm, we have--setbacks 
on, you know, if an intermittent stream comes through once a 
year, they say you have to set back, you know, 100 feet on each 
side, multiplied by--if I am farming 750 acres, and pretty 
hilly in parts of Pennsylvania, so I am just guessing off the 
top--30 or 40 different ditches, that is a lot of acres that 
are tillable and not on crop production. And, you know, we are 
on a--definitely a market-based relation. We have to, you know, 
our bushels per acre. So that would be--definitely affect the 
amount of acres that we would be actually farming.
    Mr. Perry. Let me ask you this. Do you--the acreage you 
currently farm, do you know all the subsurface connections 
right now? Do you know them?
    Mr. Nagle. No. No, I do not.
    Mr. Perry. Do you know how to figure that out?
    Mr. Nagle. No, I don't.
    Mr. Perry. Who is going to determine that?
    Mr. Nagle. I am not sure who determines that.
    Mr. Perry. Mr. Chairman, thank you. I yield.
    Mr. Shuster. Thank you. Mr. Rice?
    Mr. Rice. I have to come back to you, Mr. Nagel. You say 
you don't trust the Federal Government to fairly and 
efficiently administer these rules to farmers, and I think that 
equally applies to these energy companies and contractors here. 
It would be absurd to think that if you mishandled a ditch 
adjacent to one of your fields that the Federal Government 
might shut that field down until the dispute was resolved, and 
charge you $37,500 a day.
    But it is also absurd to realize that it takes 10 years to 
get approval to build a highway, and it takes 15 years to get 
approval to dig out a port that has been dug out five times 
before. It is also absurd to think that it takes 5 years, and 
counting, to get the Keystone pipeline approved. So, no, I 
think your mistrust is well placed.
    I believe that Federal regulation is a noose around the 
neck of the American economy. I think if we can compete fairly 
globally, then nobody can beat us, but we are strangling our 
own selves. We have a noose of regulation around our own necks, 
and we are strangling our own selves. I think you should keep 
your mistrust. I think that George Washington, and Thomas 
Jefferson, and John Adams, and Ben Franklin, they didn't trust 
the Federal Government either, and they are the ones who wrote 
the Constitution. So I am with you in that camp.
    I think we need to do whatever we can to avoid this rule 
being promulgated, number one, and we need to look at Federal 
regulation in general, and see what we can't--can do to 
streamline and make it much more efficient, because it has 
grown completely out of hand, and this is just one area. I 
mean, throughout the entire Federal Government, this is a big, 
big problem. I have never dealt much with transportation and 
infrastructure issues before I was in Congress, and I have only 
been in Congress 15 months, but before that I was a tax lawyer 
for 25 years, and believe me, I understand the impact of 
Federal regulation on business. Thank you very much.
    Mr. Shuster. Thank you for being here. I just have one 
request for Mr. Spigelmyer. The Rice Energy situation is--
again, if you can talk to someone of your membership, and if 
they can get their Pennsylvania experience, versus--I know you 
have got people that operate all over the country. And, again, 
I understand, and that is the question to Ms. Winkler about 
Pennsylvania and Ohio. They are just on the other side of the 
river from each other. So if you can get us examples--we will 
even blot out the names, because, as Mr. Rice points out, and I 
think everybody here, you don't trust the Federal Government. 
You are afraid they are going to do something to harm you 
financially if you spout off too loud.
    Mr. Spigelmyer. Mr. Chairman, I mean, I think there will be 
plenty of examples to provide you. Like you, and Congressman 
Perry, you represent districts in Pennsylvania. Without 
predictability, without certainty, capital flows elsewhere. I 
don't think it was intentional, but Congressman Gibbs made it 
real clear, it is easy to do business right now in Ohio. That 
is a competitive disadvantage for our Commonwealth. It is 
harder for us to attract jobs. It is harder for us to attract 
capital. It is harder for us to grow the play if we are a less 
predictable, a less certain environment to invest. And, you 
know, again, appreciate the help that you have provided, and 
attention you provided to this issue. We will continue to work 
closely and get the answers for you.
    Mr. Shuster. Again, I guess the last question I will ask 
you, Mr. Spigelmyer. It is my view that, you know, one of the 
diplomatic tools that we have available today, especially as we 
are faced with folks in the Middle East who don't like us--
energy, and with Russia. And I believe that if the President 
were to get FERC to sign some of these permits to start to 
build liquefied natural gas plants at our ports around this 
country, we would stop Putin--we would stop the Russians in 
their tracks. Do you think that is reasonable?
    Mr. Spigelmyer. Yeah. It is certainly a global competitive 
play for America. Certainly it has changed, the--shale gas 
development generally across this country. This isn't a 
Marcellus or a Utica play. This is--shale plays all across the 
U.S. have changed the outlook for energy, and it is a global 
strength for us. It has put people to jobs. It has brought men 
and women home from foreign land that, you know, had a helmet 
on to wear a hard hat today produce natural gas, to produce 
oil.
    You know, when I was young, we were 57 percent dependent on 
oil. As early as 2005, 2006, today, we are 42 percent dependent 
on oil--on foreign oil because of the fact we are producing 
more and more of it here at home. We need to continue to do 
that.
    Mr. Shuster. Well, again, thank you. And, again, I would 
encourage everybody, especially the State of Pennsylvania, 
before Mr. Gibbs holds his next hearing--it is important that 
the States, and the different associations, whether it is the 
Farm Bureau, or the home builders, or the energy companies, 
really making sure you are looking deeply at this rulemaking on 
the U.S. waters, because I think that all of us up here share 
your concerns, and I think they are valid. So we want to make 
sure that we hear from you. Not only that Congress hears, but 
to make sure your members of your associations are out there 
talking to the communities out there, what it is going to do to 
the cost of food, the cost of housing, the cost of energy. It 
is going to come out of the consumer's pocket.
    So again, I think all of us want to protect the 
environment, but we need to do it in a way that is science-
based, not some knee jerk reaction to protecting the 
environment, because it is going to cost us all in the end, 
jobs, it is going to cost us money, and we are not going to get 
an environment that is necessarily cleaner, or more protected. 
So, again, I thank everybody for taking the time, thank the 
folks in the audience who took the time to come out today, and 
thank the Members traveling from the various States, appreciate 
it. Mister----
    Mr. Denham. From Myrtle Beach.
    Mr. Shuster. Mr. Denham, do you want to make a commercial 
for California? Again, I really appreciate the Members coming 
out and spending the time here today, and this is the way that 
Congress gets the facts. And, as we move forward, we are going 
to be pushing back hard on this new regulation that they are 
looking at. So, again, thank you all very much. And, with that, 
do I have to say anything? Hold on a second, I have got to do 
housekeeping here. I ask unanimous consent the record of 
today's hearing remain open until such time as our witnesses 
have provided answers to any questions that may be submitting 
in writing, and unanimous consent that the record remain open 
for 15 days for additional comments and information submitted 
by a Member or witnesses to be included in today's record. 
Without objection, so ordered, and with that, the committee 
stands adjourned.

    [Whereupon, at 10:36 a.m., the committee was adjourned.]
    
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