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




 PROTECTING THE RIGHTS OF PROPERTY OWNERS: PROPOSED FEDERAL CRITICAL 
                    HABITAT DESIGNATIONS GONE WILD

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

                        OVERSIGHT FIELD HEARING

                               before the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

            Wednesday, May 14, 2014 in Batesville, Arkansas

                               __________

                           Serial No. 113-71

                               __________

       Printed for the use of the Committee on Natural Resources


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                     COMMITTEE ON NATURAL RESOURCES

                       DOC HASTINGS, WA, Chairman
            PETER A. DeFAZIO, OR, Ranking Democratic Member

Don Young, AK                        Eni F. H. Faleomavaega, AS
Louie Gohmert, TX                    Frank Pallone, Jr., NJ
Rob Bishop, UT                       Grace F. Napolitano, CA
Doug Lamborn, CO                     Rush Holt, NJ
Robert J. Wittman, VA                Rauul M. Grijalva, AZ
Paul C. Broun, GA                    Madeleine Z. Bordallo, GU
John Fleming, LA                     Jim Costa, CA
Tom McClintock, CA                   Gregorio Kilili Camacho Sablan, 
Glenn Thompson, PA                       CNMI
Cynthia M. Lummis, WY                Niki Tsongas, MA
Dan Benishek, MI                     Pedro R. Pierluisi, PR
Jeff Duncan, SC                      Colleen W. Hanabusa, HI
Scott R. Tipton, CO                  Tony Caardenas, CA
Paul A. Gosar, AZ                    Jared Huffman, CA
Rauul R. Labrador, ID                Raul Ruiz, CA
Steve Southerland, II, FL            Carol Shea-Porter, NH
Bill Flores, TX                      Alan S. Lowenthal, CA
Jon Runyan, NJ                       Joe Garcia, FL
Markwayne Mullin, OK                 Matt Cartwright, PA
Steve Daines, MT                     Katherine M. Clark, MA
Kevin Cramer, ND                     Vacancy
Doug LaMalfa, CA
Jason T. Smith, MO
Vance M. McAllister, LA
Bradley Byrne, AL

                       Todd Young, Chief of Staff
                Lisa Pittman, Chief Legislative Counsel
                 Penny Dodge, Democratic Staff Director
                David Watkins, Democratic Chief Counsel
                                 ------                                























                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Wednesday, May 14, 2014..........................     1

Statement of Members:
    Crawford, Hon. Rick, a Representative in Congress from the 
      State of Arkansas..........................................     5
    Hastings, Hon. Doc, a Representative in Congress from the 
      State of Washington........................................     3
        Prepared statement of....................................     4

Statement of Witnesses:
    Creasy, Marcus, Arkansas Cattlemen's Association, Heber 
      Springs, Arkansas..........................................     8
        Prepared statement of....................................     9
    Day, Peter, Director, Camp Ozark, Mt. Ida, Arkansas..........    10
        Prepared statement of....................................    11
    Dohner, Cynthia, Southeast Regional Director, U.S. Fish and 
      Wildlife Service, Atlanta, Georgia.........................    12
        Prepared statement of....................................    14
    Fox, Joe, State Forester, Arkansas Forestry Commission, 
      Little Rock, Arkansas......................................    19
        Prepared statement of....................................    20
    Hamilton, Gregory, Ph.D., Senior Research Economist, 
      University of Arkansas Little Rock, Institute for Economic 
      Advancement, Little Rock, Arkansas.........................    22
        Prepared statement of....................................    24
    McDaniel, Roland, Principal, Senior Scientist, GBMc & 
      Associates, Bryant, Arkansas...............................    28
        Prepared statement of....................................    30
    Pharr, Gene, Farmer, Lincoln, Arkansas.......................    26
        Prepared statement of....................................    27
    Veach, Randy, President, Arkansas Farm Bureau, Little Rock, 
      Arkansas...................................................    35
        Prepared statement of....................................    37
    Warner, Curtis, Director of Compliance and Support, Arkansas 
      Electric Cooperative Corporation, Little Rock, Arkansas....    38
        Prepared statement of....................................    40

                                     


 
 OVERSIGHT FIELD HEARING ON PROTECTING THE RIGHTS OF PROPERTY OWNERS: 
        PROPOSED FEDERAL CRITICAL HABITAT DESIGNATIONS GONE WILD

                              ----------                              


                        Wednesday, May 14, 2014

                     U.S. House of Representatives

                     Committee on Natural Resources

                          Batesville, Arkansas

                              ----------                              

    The committee met, pursuant to call, at 10:00 a.m., in 
Independence Hall, University of Arkansas Community College, 
2005 White Drive, Hon. Doc Hastings [Chairman of the Committee] 
presiding.
    Present: Representative Hastings.
    Also Present: Representative Crawford.
    The Chairman. The House Committee on Natural Resources will 
come to order. The committee is meeting here in Batesville, 
Arkansas to hear testimony on ``Protecting the Rights of 
Private Property Owners: Proposed Federal Critical Habitat 
Designations Gone Wild.''
    Since Mr. Crawford, your congressman, is not a member of 
the Natural Resources Committee, without objection, he can sit 
on the committee.
    By way of introduction, I am Congressman Doc Hastings, and 
I have the privilege of representing the 4th District in 
Washington State. My district is in the eastern part of the 
State, for those of you that are familiar with the State. It 
runs from the Oregon border to the Canadian border. It is 
largely rural in nature, very diverse agriculture, mainly 
because of the irrigated crops that we grow, and I could make a 
whole list of what those crops are. But I will say the slogan 
``an apple a day keeps the doctor away'' is appropriate for my 
district. So if you want to promote Washington apples, then you 
are certainly welcome to do so.
    But it is my privilege to be here, and I am here largely 
because of the efforts of your congressman, Rick Crawford, and 
because of the impact the Endangered Species Act may have on 
this area with the potential listings that are being suggested.
    So with that, let me turn it over to your congressman, Rick 
Crawford, for the purposes of introduction.
    Rick.
    Mr. Crawford. Thank you, Mr. Chairman.
    Again, I want to thank the Chairman not only for being here 
but for allowing me the latitude to participate on the Natural 
Resources Committee. I am not a member. However, this is very 
important to our district.
    Thank you all for being here today.
    Being that this is a congressional hearing, we are going to 
begin, as we do with every session of the House of 
Representatives, with a prayer and posting of the colors and 
the Pledge of Allegiance.
    I would now like to recognize Pastor David Insell of 
Believers Community Church of Batesville to offer today's 
prayer.
    [Prayer.]
    Mr. Crawford. I would now like to recognize Cub Scout Pack 
600, Trey Moody and Ben Gunderman, to post the colors.
    [Colors.]
    Mr. Crawford. If you would remain standing as our Cub 
Scouts lead our Pledge of Allegiance.
    [Pledge of Allegiance.]
    [Applause.]
    Mr. Crawford. Cub Scouts, don't go anywhere. I have a 
presentation for you. If you want to come up here, we would 
like to present our Cub Scouts Pack 600 with a flag that has 
been flown over the House of Representatives to commemorate 
their service today.
    [Applause.]
    Mr. Crawford. And I would like to recognize finally Mayor 
Elumbaugh to say a few words before we get started.
    Mr. Elumbaugh. Congressman, thank you very much, and 
welcome everyone here to the city of Batesville. The city of 
Batesville is the oldest city in the State of Arkansas. So, 
guys, we are so thankful that you are here this morning. 
Hopefully you will have the opportunity to go out and explore 
our community, see some of the historic homes on Main Street, 
as well as our beautiful White River.
    With that being said, I would like to recognize a few of 
the individuals in the audience today. We have Judge Robert 
Griffin. I have a city councilman, I think, Mr. Tommy Bryant in 
the audience; a Coram court member, Mr. Lackey Moody. So glad 
to have you guys here today.
    And, Congressman, we greatly appreciate you facilitating 
this meeting, and your staff. It means a lot for us here in the 
community. We believe in transparency, and like I said, welcome 
here. I know we have individuals from Jackson County. Mr. 
Lacey, I see you out there in the crowd. Glad to have our 
neighbors over here.
    So again, hope you enjoy your day. And committee, thank you 
so much for taking time out of your busy schedule and being 
here. Everyone enjoy. Thank you.
    [Applause.]
    The Chairman. Thank you very much.
    Let me explain kind of how House committees work. The 
committee starts generally with the Chairman and members making 
an opening statement, and we try to keep those opening 
statements to within a 5-minute time period.
    Then after the members make their opening statement with 
their observations, we will go to our panel, where they will 
have an opportunity to present their statements. I will repeat 
this later on, but they have all submitted a statement for the 
record, and we will ask that they keep their oral statements 
within 5 minutes.
    Then after that, Mr. Crawford and I will ask questions as 
may come up, and as long as there is interest, we will continue 
with that process.
    So that is the way the committee process works.
    So with that, I will recognize myself for my opening 
statement.

    STATEMENT OF THE HON. DOC HASTINGS, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF WASHINGTON

    The Chairman. As I mentioned, I am pleased to be here in 
Batesville this morning with Congressman Crawford as part of 
the committee's continued oversight of the Endangered Species 
Act. That law is a law that has not been reauthorized for over 
25 years. And it is a law that was designed to protect species, 
but in its practice it has a recovery rate of less than 2 
percent.
    It is important that Congress and its committees listen 
firsthand to how the Endangered Species Act impacts rural 
communities.
    While legitimate questions remain about whether listing two 
mussels this year under ESA was warranted to begin with, 
today's hearing has two specific purposes: first, to hear from 
a variety of affected Arkansas private property owners and 
other local interests about the potential impacts of the 
Federal Government's critical habitat designations on private 
property owners; and two, to explore concrete legislative 
solutions, such as H.R. 4319, a bill that was introduced 
several weeks ago that is sponsored by Mr. Crawford and the 
other three members of the Arkansas delegation.
    A little bit of background. The Obama administration has 
allowed a ``sue and settle'' approach to dictate how Federal 
taxpayer-funded resources are used to prioritize endangered 
species activities. This happens when extreme environmental 
groups sue the Federal Government, which in turn then settles 
with that group behind closed doors. Now, that settlement 
happens without input from the very people that are potentially 
impacted by that settlement.
    Nationwide, ramped-up ESA listings and habitat designations 
through closed-door settlements are disrupting many facets of 
American life including rural economies, recreation, energy 
development, and private landowners' use of their own property. 
Here in Arkansas and in other southeast States, the Fish and 
Wildlife Service has proposed to designate 769 miles of rivers 
and streams in 28 Arkansas counties as critical habitat for the 
Neosho Mucket and the Rabbitsfoot Mussel. I am told that in 
several areas these species haven't been seen for years, or at 
all.
    Now, the Fish and Wildlife Service, in response to several 
groups' petition--and these several groups, by the way, in 
their petition they say, and I quote, ``a Southeast freshwater 
extinction crisis exists''--is also in the process of deciding 
whether another listing is warranted for 370 more species of 
crayfish, plants, mollusks, moths, flies, frogs, and fish. Now, 
the geographic area for this is essentially the whole 
southeastern part of the United States. It is not a small area.
    Listing hundreds of new ESA species could significantly 
alter hydropower-producing dams, agriculture, logging, mining, 
fish aquaculture, and a host of other vital economic and 
private interests.
    I want to note that we invited those people that petitioned 
to have these species listed to testify here in front of this 
committee, but they declined to do so. Now, I think that is a 
bit, honestly, irresponsible, because it was their petition 
that caused the listing that has the potential negative impact 
on people in this area, and they were invited to attend a 
congressional hearing and refused to do so. Well, I just don't 
think that is a very good policy, to be very honest with you.
    Despite what some say, these policies do have costs. Last 
year the Obama administration finalized a regulation that 
effectively shut out Congress, States, and the American public 
from accurately identifying the true costs of ESA listings. 
Already, millions of acres of public and private property 
nationwide have been included in habitat designations that will 
dramatically impact the future of those lands.
    I believe that the analysis put forward for these proposed 
mussel designations vastly understates the costs to the 
citizens of this State. Longer term, legislation is needed to 
require more transparency for the true costs of these listings 
and habitat designations, and to limit them to areas where the 
costs do not outweigh the benefits.
    So, I appreciate the efforts of my colleagues and others to 
do just that and look forward to hearing from our witnesses 
today on how to improve the outlook for maintaining these 
species and to protect private property rights.
    [The prepared statement of Mr. Hastings follows:]
  Prepared Statement of the Hon. Doc Hastings, Chairman, Committee on 
                           Natural Resources
    I'm pleased to be in Batesville this morning with Congressman 
Crawford as part of the committee's continued oversight of the 
Endangered Species Act. It is a law which has not been reauthorized in 
25 years, and it is a law that was designed to protect species but has 
a less than 2 percent recovery rate. It is important that Congress 
travel to listen firsthand how the Endangered Species Act impacts rural 
America.
    While legitimate questions remain about whether listing two mussels 
last year under ESA was warranted to begin with, today's hearing has 
two specific purposes: (1) to hear from a variety of affected Arkansas 
private property owners and other local interests about the potential 
impacts of the Federal Government's critical habitat designations on 
private property owners and (2) to explore concrete legislative 
solutions, such as H.R. 4319, a bill introduced several weeks ago by my 
colleague, Congressman Crawford, and co-sponsored by Congressmen 
Cotton, Womack and Griffin, to address this problem.
    The Obama administration has allowed a `sue and settle' approach to 
dictate how Federal taxpayer-funded resources are used to prioritize 
endangered species activities. This happens when an extreme 
environmental group sues the Federal Government, which in turn settles 
with that group behind closed doors. That settlement happened without 
input from the very people the decision affects. Nationwide, ramped up 
ESA listings and habitat designations and closed-door settlements are 
disrupting many facets of American life including rural economies, 
recreation, energy development, and private landowners' use of their 
own property.
    Here in Arkansas and in other southeast States, the Fish and 
Wildlife Service has proposed to designate 769 miles of rivers and 
streams in 28 Arkansas counties as critical habitat for the Neosho 
Mucket and the Rabbitsfoot mussel. I'm told that in several areas the 
species haven't been seen for years, or at all.
    The Service, in response to several groups' petition they call ``a 
Southeast freshwater extinction crisis,'' is also in the process of 
deciding whether listing is warranted for another 374 species of 
crayfish, plants, mollusks, moths, flies, frogs, and fish. The 
geographical area for this petition is in Arkansas, Alabama, Florida, 
Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South 
Carolina, Tennessee, Virginia and West Virginia. Not a small area.
    Listing hundreds of new ESA species could significantly alter 
hydropower-producing dams, agriculture, logging, mining, fish 
aquaculture, and a host of other vital economic and private interests.
    I want to note that we invited the head of the Fish and Wildlife 
and representatives of the petitioning groups to explain their views. 
Each declined to be here, which unfortunately demonstrates how little 
regard they apparently have for those most affected by their litigation 
and the potential sweeping policies that follow. They are the ones 
responsible for what we are hearing about today and their absence says 
a lot.
    Despite what some say, these policies do have costs. Unfortunately, 
last year the Obama administration finalized a regulation that 
effectively shut out Congress, States and the American public from 
accurately identifying the true costs of ESA listings and critical 
habitat designations. Already, millions of acres of public and private 
property nationwide have been included in habitat designations that 
will dramatically impact the future value and multiple uses of those 
lands.
    I believe the analysis put forward for these proposed mussel 
designations vastly understates the costs to the citizens of Arkansas 
and other States. Longer term, legislation is needed to require more 
transparency for the true costs of these listings and habitat 
designations, and to limit them to areas where the costs do not 
outweigh the benefits.
    I appreciate the efforts of my colleague and others to do just that 
and look forward to hearing from our witnesses on how to improve the 
outlook not just for species but for the American people. We can help 
truly endangered animals but we cannot stand idly by when policies 
mandated the Federal Government and their environmental friends stand 
to make rural America THE endangered species.

                                 ______
                                 

    The Chairman. With that, I will yield to Mr. Crawford for 
his opening statement.

   STATEMENT OF THE HON. RICK CRAWFORD, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF ARKANSAS

    Mr. Crawford. I thank the Chairman again for coming to 
Batesville today to hear firsthand from my fellow Arkansans 
about the wide-ranging and direct impact that actions by the 
Federal Government have on us, its citizens.
    I would also like to thank the witnesses who have agreed to 
appear today and share with us their knowledge and experience.
    And last, I want to thank all in attendance for making the 
time to be here as well.
    Today's hearing asks a few simple questions. Should the 
Federal Government measure the actual cost to lives and 
livelihoods of designating a particular area as critical 
habitat? And should the Federal Government weigh that cost 
against the conservation benefit?
    Last year I learned that a significant portion of the 
waterways in my district could be designated critical habitat 
for the Neosho Mucket and Rabbitsfoot Mussels. I also learned 
at the time that the U.S. Fish and Wildlife's new method of 
measuring the economic impact of such a broad designation, with 
the potential to affect tens of thousands of my constituents 
and countless farms, small and large businesses, and 
municipalities, would be entirely made up of merely the cost of 
Federal agencies consulting with each other on compliance.
    Under this so-called incremental approach, now favored by 
Fish and Wildlife Service, there would be no consideration for 
the potential loss of the use of land and water and for 
activities such as farming and manufacturing which use water or 
the waterways falling under this designation. The Federal 
Government would not examine how this broad designation could 
cost the people and businesses of my district the loss of the 
use of their land, the loss of their jobs, or the very real 
threat of new, burdensome, and unexpected regulatory costs.
    This incremental approach basically measures the cost of 
paperwork and bureaucracy. It hides the real and true economic 
impact of designating areas as critical habitat from the 
American public and fails to provide the needed information to 
measure and reveal the true cost to lives and livelihoods 
weighed against the relative benefit gained.
    It has not always been this way. The U.S. Fish and Wildlife 
Service used an approach in the past for many years that 
measured the true cost of designating particular areas in terms 
of lost use, increased cost and loss of jobs. This so-called 
cumulative approach gives a true picture of the cost of 
designating a particular area as critical habitat and permits 
an accurate and transparent measure of the true impact on 
people, businesses, and municipalities, versus the benefits 
gained.
    In response, I have recently introduced legislation called 
the Common Sense in Species Protection Act, or H.R. 4319, which 
not only calls for the true measure of the cost of a 
designation in lives and livelihoods but for that cost to be 
considered when the Federal Government decides which areas will 
and will not be covered. This legislation simply requires the 
Federal Government to be more transparent, accountable, and 
fair to those potentially impacted by critical habitat 
designations.
    I would like to point out that this legislation does not 
change the actual listing process at all. The very last part of 
the bill specifically states that. It does, however, say that 
Fish and Wildlife Service should go back to using the 
cumulative method and measure the real cost to those who live 
and work inside proposed boundaries.
    I am very happy that we are here in Batesville today to 
hear firsthand from fellow Arkansans about their concerns on 
this important issue. Even now, as Fish and Wildlife Service 
reopens the comment period yet again, the economic analysis 
only considers the cost of government bureaucracy and ignores 
the true cost to the lives and livelihoods of those who live 
across the proposed area.
    Once again, thank you, Mr. Chairman, for coming here to 
Batesville to hear the concerns of those who will be most 
impacted not only by the critical habitat designation but by 
the manner in which the economic impact is calculated. I 
encourage all here today who have something to say to please 
write down your thoughts on one of the comment forms in the 
back. We will read all of them, and all will be submitted to 
become part of the official record of this hearing.
    And with that, I yield back.
    The Chairman. I thank the gentleman very much, and I again 
want to thank him for asking us to be here. I think this is a 
very important hearing, and I will say that by way of 
background. I mentioned I am from the Northwest, and the 
Endangered Species Act for the last generation-and-a-half has 
had an impact on the Northwest from the standpoint of logging 
and fish, particularly salmon in the Columbia River system. So 
we have been impacted for some time, but most of the impacts of 
the Endangered Species Act nationwide, not entirely but most of 
it, has been in the Pacific Northwest.
    With this mega-listing that happened several years ago by 
the Obama administration, it is now affecting other parts of 
the country, and you are seeing now firsthand, and that is the 
reason for this hearing, and I want to again thank Rick for 
pressuring us hard to come here, and I am glad that we are 
here.
    Now we are going to hear from our witnesses, and as I 
mentioned earlier, all of you were asked to submit a written 
statement which will be part of the record. But I would ask you 
to keep your oral remarks within the 5 minutes.
    We have these little timing lights here. You have one in 
the middle of your table. I will explain how that works. It is 
kind of like a traffic light. When the green light is going, 
you are just doing famously well because you have a total of 5 
minutes. And then when the yellow light comes on, that is just 
like when you are going through the traffic lights, you speed 
up. Then comes the red light. If you could just wrap up your 
remarks within that timeframe, we would very much appreciate 
it.
    Also, at the front of the room there are comment forms if 
anybody here would like to comment on what we are talking about 
here, which is principally the Endangered Species Act, or you 
can go to the Natural Resources Committee Web site. It is 
naturalresources.house.gov. If you press ``Contact Us,'' then 
you can make your comments there. So I would invite you to do 
that.
    Our witnesses here today are: Mr. Marcus Creasy, who is 
from the Arkansas Cattlemen's Association out of Heber Springs 
here in Arkansas; Mr. Peter Day, Director, Camp Ozark from Mt. 
Ida, Arkansas; Ms. Cynthia Dohner, the Southeast Regional 
Director of the U.S. Fish and Wildlife Service from Atlanta--
thank you for being here; Mr. Joe Fox is the State Forester 
from the Arkansas Forestry Commission in Little Rock; Mr. 
Gregory Hamilton, Ph.D., Senior Research Economist from the 
University of Arkansas Little Rock, Institute for Economic 
Advancement; Mr. Roland McDaniel, Principal, Senior Scientist 
at GBMc and Associates out of Bryant, Arkansas; Mr. Gene Pharr, 
a farmer in Lincoln, Arkansas; Mr. Randy Veach, President of 
the Arkansas Farm Bureau in Little Rock; and Mr. Curtis Warner, 
Director of Compliance and Support for the Arkansas Electric 
Cooperative Corporation out of Little Rock.
    As I mentioned earlier, there were two individuals that we 
did invite, Mr. Noah Greenwald, the Endangered Species Director 
for the Center for Biological Diversity, one of those that was 
pushing the petition to list these species from Portland, 
Oregon; and Ms. Cyn Sarthou, Executive Director of the Gulf 
Restoration Network of New Orleans, to testify in front of this 
committee. Since the impact of their petition has such a huge 
impact, I thought it would be only right that they attend. But 
they did not, and I think their empty chairs, frankly, speaks 
volumes about where we are in this.
    So, with that, let me recognize Mr. Marcus Creasy with the 
Arkansas Cattlemen's Association.
    You are recognized for 5 minutes.

 STATEMENT OF MARCUS CREASY, ARKANSAS CATTLEMEN'S ASSOCIATION, 
                    HEBER SPRINGS, ARKANSAS

    Mr. Creasy. Thank you, Mr. Chairman. First I would like to 
thank you and the committee for coming to Arkansas to hold a 
field hearing at Congressman Crawford's request. My name is 
Marcus Creasy. I am a cattle producer from Drasco, Arkansas. I 
am also the Immediate Past President of the Arkansas 
Cattlemen's Association. We have been working with endangered 
species since 2010/2011 with the notification of the Yellow 
Cheek Darter. That has come into my part of the world, 
personally touches our county, so we have been dealing with 
this for just a little while.
    Before I start right into my written testimony, I would 
like to make note that we have some additional comments. When 
friends from across the United States understood we were coming 
in to give testimony, I have a paper that I would like to leave 
to put into the official record from our friends.
    The Chairman. Without objection, that will be part of the 
record.
    Mr. Creasy. Thank you, sir, from our friends from across 
the West that have been dealing with endangered species and the 
critical habitat designations, so I would like to include 
those.
    But for my comments, I feel this hearing today is 
imperative for you to hear directly from the producers affected 
by U.S. Fish and Wildlife's regulation overreach with 
designations of critical habitat and economic impact studies 
that are not all inclusive, as has been stated already. Many 
times, critical habitat designations list cattle as being 
detrimental to populations of species listed, as well as their 
habitat. Also, many times critical habitat designations are 
expanded to include private property owned by cattlemen even 
when the primary constituent elements for the listed species' 
habitat are not present; for example, the Yellow Cheek Darter 
that we dealt with.
    A prime example is that Darter in the 4 forks of the Little 
Red and their tributaries above the Greers Ferry Dam. Not only 
did this designation include language to list cattle ranching 
as being a negative impact upon species population and habitat, 
but initially a large percentage of the designation was outside 
of those high-water marks for those streams, while all the 
primary constituent elements that have to be present for the 
healthy habitat lie within those high-water marks.
    At this point, what is needed for the extra acreage to be 
included in the designation, if not for control? And why would 
the economic analysis not include the negative economic impact 
from taking this acreage out of production or limiting the 
landowner's property rights, as we have already kind of heard?
    When we as cattlemen are listed as an adverse modification 
within the critical habitat designation, why are those points 
left out of the economic impact? Why are stakeholder meetings 
not scheduled? Why are they not coming to we, as producers, 
directly when they know that it is supposedly adversely 
affecting these species?
    These are questions we have with U.S. Fish and Wildlife's 
overreaching regulations. We understand that they have a job to 
do, we do understand that, but there needs to be adequate 
transparency. There needs to be full and thorough economic 
studies complete on all implications before designation is set, 
and then open lines of communication with all involved so that 
those designations have minimal impact to the established 
economy inside the designation while allowing for protection of 
the species and its habitat.
    It is hard for us at the end of the day to believe the only 
impact is agency consultation when cattle production keeps 
being listed as an adverse modification. Therefore, we have 
concerns with critical habitat designations and believe the 
U.S. Fish and Wildlife should be more transparent with 
information concerning listing of species and the critical 
habitat designations, more complete with their economic 
analysis and not just limit those economic impacts to agency 
consultations, and more forthcoming with open lines of 
communication to stakeholders' involvement.
    Arkansas is a rural State. Farming and ranching are still 
the lifeblood to a large percentage of our local communities 
and their survival. Understanding that Fish and Wildlife has a 
job to do, it would be nice if they would remember that point.
    Again, on behalf of the cattlemen of Arkansas, I would like 
to thank the committee for showing their concern of Federal 
agency overreach and hosting this field hearing today, and 
would also like to thank Congressman Crawford and his staff for 
standing up for Arkansas agriculture.
    I would be more than happy to answer any questions that the 
committee might have at this time. Thank you again very much.
    [The prepared statement of Mr. Creasy follows:]
Prepared Statement of Marcus Creasy, Arkansas Cattlemen's Association, 
                        Heber Springs, Arkansas
    First I would like to say thank you to the committee for coming to 
Arkansas to hold a field hearing at Congressman Crawford's request. My 
name is Marcus Creasy and I am a cattleman from Drasco, AR. I am also 
the Immediate Past President of the Arkansas Cattlemen's Association.
    I feel this hearing today is imperative for you to hear directly 
from the producers affected by U.S. Fish and Wildlife's regulation 
overreach with designations of Critical Habitat and economic impact 
studies that are not all inclusive. Many times Critical Habitat 
designations list cattle as being detrimental to populations of the 
species listed as well as their habitat. Also many times Critical 
Habitat designations are expanded to include private property owned by 
cattlemen even when the primary constituent elements for the listed 
species' habitat are not present.
    A prime example would be Critical Habitat for the Yellow Cheek 
Darter in the 4 forks of the Little Red River and their tributaries 
above the Greers Ferry Dam. Not only did this designation include 
language to list cattle ranching as being a negative impact upon 
species population and habitat, but initially a large percent of the 
designation was outside the high water marks for these streams while 
all the primary constituent elements that have to be present for the 
healthy habitat for species growth is not outside the high water mark.
    At this point what is the need for the extra acreage to be included 
in the designation if not for control, and why would the economic 
analysis not include the negative economic impact from taking this 
acreage out of production or limiting the land owner's property rights? 
When we as cattlemen are listed as an adverse modification within the 
Critical Habitat designation why are those points left out of the 
economic impact, why are stakeholder meetings not scheduled?
    These are the questions we have with U.S. Fish & Wildlife's 
overreaching regulation. We understand they have a job to do, but there 
needs to be adequate transparency, there needs to be full and thorough 
economic studies complete on all implications before designation is 
set, and then open lines of communication with all involved so that 
designations have minimal impact to the established economy inside the 
designation while allowing for protection of the species and its 
habitat.
    It is hard for us at the end of the day to believe the only impact 
is agency consultation when cattle production keeps being listed as an 
``adverse modification,'' therefore we have concerns with critical 
habitat designations and believe the U.S. Fish & Wildlife should be 
more transparent with information concerning listing of species and 
critical habitat designations, more complete with their economic 
analysis and not just limit economic impacts to agency consultations, 
and more forthcoming with open lines of communication to stakeholders 
involvement.
    Arkansas is a rural State and farming and ranching are still the 
lifeblood to a large percent of our local communities and their 
survival. Understanding that U.S. Fish & Wildlife has a job to do, it 
would be nice if they would remember this point.
    Again on behalf of the cattlemen of Arkansas, I would like to thank 
the committee for showing their concern of Federal agency overreach and 
hosting this field hearing here today and would also like to thank 
Congressman Crawford and his staff for standing up for Arkansas 
agriculture.
    I would be more than happy to answer any questions the committee 
might have, again thank you for allowing me to give testimony.

                                 ______
                                 

    The Chairman. Thank you very much, Mr. Creasy.
    I will now recognize Mr. Peter Day, Director of Camp Ozark 
from Mt. Ida, Arkansas.
    You are recognized for 5 minutes.

STATEMENT OF PETER DAY, DIRECTOR, CAMP OZARK, MT. IDA, ARKANSAS

    Mr. Day. Again, I would also like to thank Chairman 
Hastings, Congressman Griffin for bringing this to Arkansas. I 
am Pete Day. I work for Camp Ozark and Camp War Eagle, and we 
are a residential summer camp. We are an educational and 
Christian summer camp in Mt. Ida, Arkansas, specifically Camp 
Ozark is. Camp Ozark is located along the banks of the Upper 
Ouachita River, close to the RF4A. We are actually on that 
section of designated habitat.
    Every summer, Camp Ozark brings over 5,000 campers from 35 
different States to Arkansas for a summer camp experience. We 
have campers from many foreign countries that come to Arkansas 
to participate in the summer camp experience. Our camp not only 
gives kids an impact on their lives, but we are actually the 
second-biggest employer in our county in Arkansas.
    Our impact on our county is over $8.2 million a year, and 
that has doubled from 10 years ago when we first did the study. 
So we have a significant not only cultural impact but economic 
impact on our area.
    In addition to many summer staffers, we have year-round 
employees who depend on the success of our camp to support 
their families. We offer over 120 programs and classes to our 
campers. And as you can imagine, many of them center around the 
Ouachita River. We feel blessed to have our property along that 
river and certainly appreciate the value of that resource.
    Every summer, our campers look forward to fishing, 
canoeing, and swimming in the river. We think it has truly been 
a major factor in our camp's success, and it is certainly one 
of the things that helps draw families to Camp Ozark every 
year. It is why younger siblings can't wait to follow older 
ones to camp, and why we now have former campers and staffers 
that bring their children to our facilities. The picturesque 
Ouachita River retreat truly has become a family tradition for 
thousands of people across this country.
    We are concerned that the proposed critical habitat 
designation for the Rabbitsfoot Mussel along the Upper Ouachita 
will interfere with many of our river activities, and it has 
become a major part of our experience. In addition, the 
designation on our portion of the river seems to be especially 
burdensome since, to my understanding, it has not been 
confirmed that in this section of river there is a mussel that 
has actually been there.
    Furthermore, we are disappointed that the Service is not 
required to take into consideration the major economic impact 
that such designation has on this area's businesses and local 
economy. I, too, appreciate and applaud the efforts that are 
underway to change that by requiring the Service to conduct 
true economic impact studies. It only makes sense that when 
considering the critical habitat designations, the agency 
should have an accurate picture of how the proposals will 
actually affect communities and the property owners who live 
there.
    As you know, once these designations are in place, they can 
be extremely rigid and limiting on exactly what kinds of 
activities are permitted. Even seemingly minor acts like 
boating could conceivably be found to have an adverse impact.
    We are concerned that the critical habitat designation 
would greatly interfere with many of Camp Ozark's river 
activities. If our campers are unable to enjoy the river as 
they have for decades, it would be a blow to our recruitment 
efforts, a potential blow to our operation, and our local 
economy.
    We think it is important to preserve our environment and 
take care of our natural resources. We feel fortunate to be 
along the Ouachita, and we feel a duty to protect it. However, 
we do favor a commonsense approach, and we oppose the critical 
habitat designation.
    Again, thank you for coming to Arkansas, and thank you for 
your time. We appreciate it.
    [The prepared statement of Mr. Day follows:]
    Prepared Statement of Peter Day, Director, Camp Ozark, Mt. Ida, 
                                Arkansas
    My name is Pete Day, and I'm with Camp War Eagle and Camp Ozark. 
Camp Ozark is a residential and educational Christian summer camp in 
Mt. Ida, Arkansas. We're located along the upper banks of the beautiful 
Ouachita River.
    We are proud to have been operating there for more than three 
decades now, and we have grown into a world-class facility that every 
summer draws 5,600 campers from 35 States and several foreign 
countries. We have a major economic impact on our part of the State. In 
fact, we are one of the top two employers in Montgomery County, and 
have an estimated impact of $8.2 million on the Central Arkansas 
economy every year. In addition to our many summer staffers, we have 
many year-round employees who all depend on the success of our camp to 
support their families.
    We offer over 120 programs and classes to our campers. As you can 
imagine, many of them center around the Ouachita River, which we feel 
blessed to have along our property. Every summer, our campers look 
forward to fishing, canoeing, and swimming in the river--we think it 
has truly been a major factor in our camp's success, and it is 
certainly one of the things that helps draw families to Camp Ozark 
every year. It's why younger siblings can't wait to follow older ones 
to camp, and why we now have former campers and staffers bringing their 
children to our facilities. Our picturesque Ouachita River retreat 
truly has become a family tradition for thousands of people across the 
country.
    We are concerned that the proposed Critical Habitat designation for 
the rabbitsfoot mussel along the Upper Ouachita will interfere with 
many of the river activities that have become a major part of our kids' 
camp experience. In addition, a designation on our portion of the river 
seems especially burdensome, since by my understanding, it has not been 
confirmed that this section actually harbors the species. Furthermore, 
we are disappointed that the Service is not required to take into 
consideration the major economic impact that such designation has on an 
area's businesses and local economy. I appreciate and applaud the 
efforts underway to change that . . . by requiring the Service to 
conduct a true economic impact study. It only makes sense that when 
considering Critical Habitat designations, the agency should have an 
accurate picture of how the proposals will actually affect communities 
and the property owners who live and work there.
    As you know, once these designations are in place, they can be 
extremely rigid and limiting on exactly what kinds of activities are 
permitted. Even seemingly minor acts like boating could conceivably be 
found to have an adverse impact.
    We are concerned that critical habitat designation would greatly 
interfere with many of Camp Ozark's river activities. If our campers 
are unable to enjoy the river as they have for decades, it would be a 
blow to our recruitment efforts, and a potential blow to our operation 
AND to our local economy.
    We think it's important to preserve our environment, and to take 
care of our natural resources. We feel fortunate to be along the 
Ouachita, and we feel a duty to protect it. However, we favor a common-
sense approach, and we oppose this Critical Habitat designation.
    Again, thank you for coming to Arkansas, and for listening to my 
concerns regarding this important issue.

                                 ______
                                 

    The Chairman. Thank you very much, Mr. Day, for your 
testimony.
    I now will recognize Ms. Cynthia Dohner, the Southeast 
Regional Director of the U.S. Fish and Wildlife Service from 
Atlanta.
    You are recognized for 5 minutes.

STATEMENT OF CYNTHIA DOHNER, SOUTHEAST REGIONAL DIRECTOR, U.S. 
          FISH AND WILDLIFE SERVICE, ATLANTA, GEORGIA

    Ms. Dohner. Thank you, sir. Good morning, Chairman Hastings 
and Representative Crawford. I am Cindy Dohner, the Southeast 
Regional Director for U.S. Fish and Wildlife Service, and I 
appreciate the opportunity to testify on the Service's 
experience with designating critical habitat under the ESA.
    Here in the Southeast, we are committed to ensuring plants 
and animals and their habitats stay forever wild while 
accomplishing conservation in a way that keeps working lands 
working. We are responsible for implementing the law as it 
stands and are relying on its flexibilities to proactively 
conserve species and gain control of our workload.
    The Southeast is a hotspot of aquatic biodiversity, and 
many of those species may be in trouble. We are encouraging 
voluntary conservation to hopefully avoid the need to list and 
provide regulatory certainty to landowners through agreements 
when protection under the Act is needed.
    Between our listing work plan and petitions, the Southeast 
Region is required to determine if more than 400 species need 
Federal protection over the next decade. Forty-eight are in 
Arkansas. We need stakeholders to be engaged and help us in 
this work as we move forward. We are working to raise awareness 
that listing has consequences for landowners. The decision to 
add a plant or an animal to the Endangered Species List 
triggers all other ESA requirements, including the requirement 
to consider if critical habitat is essential for species 
recovery.
    Critical habitat proposals are based on the best available 
scientific and commercial information. Private landowners are 
key to species conservation and providing that information. 
There are a variety of tools we can use to encourage voluntary 
efforts and assist landowners to use lands as needed in a way 
that helps conserve species.
    I know Arkansans are interested in our ESA actions for the 
Neosho mucket and the rabbitsfoot mussels. We proposed listing 
and critical habitat for the two mussels in October 2012. Since 
then, we finalized their listing and provided 150 days for 
public comment on a proposal that designates 783 river miles as 
critical habitat in Arkansas. It is less than 8 percent of the 
State's total stream miles. The proposed critical habitat is 
limited to the river itself.
    I believe that confusion over what critical habitat is and 
what it is not is at the heart of many of the concerns we hear. 
Critical habitat designations do not affect landownership and 
do not impose liens. They do not allow the government to take 
or manage private property. They do not establish a refuge or 
other conservation areas. Designating critical habitat affects 
those activities that are performed, funded, or authorized by a 
Federal agency such as building a dam or a highway. If that 
activity is likely to have an impact on a listed species or the 
critical habitat, the Federal agency consults with the Service, 
and then we develop conservation measures that allow the 
activity to go forward while conserving the species.
    The Service has consulted for decades on Federal actions in 
Arkansas simply due to the presence of other listed mussels, 
fish, in the same rivers, or proposed critical habitat with the 
Neosho mucket and the rabbitsfoot. There are 37 species 
currently listed in the State of Arkansas. Ninety-nine percent 
of these informal consultations, 99 percent, were completed in 
less than 30 days with no project delays.
    I recognize that some stakeholders are concerned about the 
economic impacts of critical habitat. The ESA does not allow us 
to consider economic impacts in our listing decision, but does 
require us to evaluate and consider probable economic impacts 
resulting from critical habitat. Since critical habitat applies 
only to Federal actions, the economic analysis identifies costs 
primarily associated with interagency consultation.
    For the two mussels, the average person should not incur 
any additional cost associated with critical habitat 
designation over and above what is required for the listing.
    Last month, Director Ashe and I came to Little Rock and met 
with numerous stakeholders, some of which are here today. I am 
happy to say that the 60-day comment period opens today, as 
committed during that meeting, and in June we will host two 
public meetings, one in Batesville and another in Benton.
    Raising awareness and requesting engagement on these issues 
and all of these species that are imperiled began nearly 18 
months ago when we met with groups in Hot Springs. I let them 
know that it is not my goal to add plants and animals to the 
Endangered Species List. Instead, in the Southeast we are 
working with the States, industry, Federal agencies, and 
private landowners to employ innovative conservation strategies 
so Federal protection for many species is not needed. We want 
State species to stay under the State management.
    With the States leading the way, and sound science as our 
guide, we are prioritizing species and pulling resources to 
acquire the best science, documenting conservation activities 
already taking place, and using voluntary, non-regulatory tools 
to proactively conserve as many at-risk species as possible, 
thereby preventing the need to list species under the ESA.
    The results are promising. Together, we have determined 
listing is not needed for nearly 40 species, and we are working 
to put together conservation tools and put these tools in place 
that provide landowners with stability and clear expectations. 
This collaborative effort will help States maintain management 
authority over the species.
    I appreciate the opportunity to testify today and would be 
glad to answer any questions.
    [The prepared statement of Ms. Dohner follows:]
 Prepared Statement of Cynthia K. Dohner, Southeast Regional Director, 
       U.S. Fish and Wildlife Service, Department of the Interior
    Good morning Chairman Hastings and members of the committee. I am 
Cindy Dohner, Southeast Regional Director for the U.S. Fish and 
Wildlife Service (Service) within the Department of the Interior. As 
Regional Director, I provide leadership and oversight for the Service's 
conservation work across 10 southeastern States, Puerto Rico, and the 
U.S. Virgin Islands. Mr. Chairman, I appreciate the opportunity to 
discuss the Service's administration of the Endangered Species Act 
(ESA), especially our experience with critical habitat designations and 
the proactive work with States we are doing in the Southeast.
    The Service is committed to making the ESA work for the American 
people to accomplish its purpose of conserving threatened and 
endangered species and protecting the ecosystems upon which they 
depend. In passing the ESA, Congress recognized we face an extinction 
crisis. Since that time, the ESA has prevented the extinction of 
hundreds of species and promoted the recovery of many others. This 
great conservation work has helped achieve Congress's call to preserve 
the Nation's natural resource heritage, and it has happened alongside 
sustained economic development. It is more important now than ever to 
have an effective, collaborative approach to conserving imperiled 
species.
    The Service's biologists are working to complete the actions 
identified in its 5-year listing workplan that was solidified in the 
Multi-District Litigation settlement agreement. The workplan is 
publicly available at www.fws.gov/endangered/improving_esa/
listing_workplan_FY13-18.html. At the same time, the Service is taking 
proactive steps with multiple partners to limit the need to list 
species where possible.
    Here in the Southeast Region, we are working with States, industry, 
Federal agencies, and large private landowners to employ creative, 
innovative, and voluntary strategies in the implementation of the ESA 
that are producing positive results for conservation, industry, and 
local economies. The results of this State-led collaboration are 
promising so far. Through these collaborative efforts, the Service has 
determined that listing is not needed for nearly 40 species, and are 
working with partners to put in place conservation tools that provide 
landowners with stability and clear expectations.
    Our objective is to conserve species in a way that comports with 
the ESA, protects our southern way of life, continues to allow working 
lands to work, considers the probable economic impacts where possible, 
and ensures the enduring tradition of outdoor recreation that is so 
important to many of our citizens. I look forward to adding my 
perspective to this discussion today about the proposed critical 
habitat designation for the federally listed Neosho mucket and 
rabbitsfoot mussels.
                listing and designating critical habitat
    Listing a species under the ESA is initiated either by the Service 
or through a petition from the public. This process is defined under 
Section 4(a) of the ESA. If listing is warranted, the Service must 
evaluate the information in its files and gather as much information on 
the species as possible from States, conservation partners, industry, 
and researchers, among others, to ensure we are using the best 
scientific and commercial information available to develop a listing 
proposal based on the factors described in Section 4(a) of the ESA. The 
proposal identifies threats (e.g., modification of habitat) and 
possible measures to address those threats, and any proposal must also 
have a public comment period and stakeholder engagement. We need to 
ensure that stakeholders such as landowners and businesses are engaged 
in the process during the proposed listing because it is that action--
whether to list or not--that triggers the regulatory compliance under 
the ESA and the other statutory requirements.
    There are numerous species that are listed under the ESA that do 
not have critical habitat designated at this time. For example, in 
Arkansas there are 37 listed species, and only two have critical 
habitat designated and two have critical habitat proposed.
    When the Service proposes an animal or plant for listing, another 
statutory requirement under Section 4 of the ESA is triggered to 
consider whether there are areas of habitat determined to be essential 
to the species' recovery and to designate any such areas as critical 
habitat. The Service proposes critical habitat designations based on 
the best available scientific and commercial information on what an 
animal or plant needs to survive, reproduce, and recover. This proposal 
is then evaluated by interested stakeholders and the public. It is only 
after this public comment period and stakeholder involvement that the 
Service makes a final determination on the boundaries of the critical 
habitat.
    Critical habitat designations do not affect land ownership or 
impose liens on property. Designating critical habitat does not allow 
the government to take or manage private property nor does it establish 
a refuge, reserve, preserve, or other conservation area. It also does 
not allow government or public access to private land. The designation 
only affects those activities that are performed, funded or authorized 
by permit of a Federal agency.
    Under Section 7(a)(2) of the ESA, Federal agencies are required to 
consult with the Service to ensure that their actions do not jeopardize 
the continued existence of a listed species or adversely modify its 
critical habitat that the species needs to recover. The Service works 
with Federal agencies through the consultation process to avoid or 
minimize impacts to a species and critical habitat by developing 
appropriate conservation measures that can be incorporated into the 
project or, if needed, a biological opinion. In most cases, these 
conservation measures would be carried out regardless of whether 
critical habitat is designated because the species is listed under the 
ESA. Interagency consultation on critical habitat often does not result 
in additional conservation measures beyond what would already be 
required because of the listing itself in areas occupied by the 
species.
    The Service may exclude an area from critical habitat if it 
determines the benefits of excluding the area outweigh the benefits of 
including it as critical habitat, provided such exclusion will not 
result in the extinction of the species. Critical habitat exclusions 
are possible for lands that have secure, long-term conservation plans 
in place that are being implemented and benefit the species, and/or 
based on national security or economic impacts.
    Just last week, the Service published a proposed policy to provide 
greater predictability, transparency and consistency regarding how the 
Services consider exclusions from critical habitat designations. Under 
the ESA, the Service evaluates the economic, national security and 
other impacts of a designation and may exclude particular areas if the 
benefits of doing so are greater than the benefits of designation. This 
proposal describes the general policy position of the Service for 
considering different types of impacts (e.g., impacts to voluntary 
conservation agreements, impacts to national security, economic 
impacts) and is intended to provide greater predictability and 
transparency to the process of considering exclusions within a critical 
habitat designation.
                      considering economic impacts
    The Service is required under section 4(b)(2) of the ESA to 
evaluate and consider probable economic and national security impacts 
along with other relevant factors resulting from the designation of 
critical habitat. Since critical habitat applies only to Federal 
actions, draft economic analyses identify costs primarily associated 
with interactions (consultations) between Federal agencies.
    The ESA does not allow the Service to consider economic impacts 
when making listing determinations. For that reason, the Service 
focuses its economic impact analyses on the incremental effects 
resulting from a critical habitat designation. These impacts are over 
and above economic impacts that result from the listing action itself. 
This methodology is supported by Executive Order 12866, Office of 
Management and Budget Circular A-4 (issued in 2003), a 2008 Memorandum 
Opinion from the Solicitor of the Department of the Interior and 
relevant case law. The Service has consistently used this approach for 
economic analyses of critical habitat designations that occur in most 
States, including those in the Southeast, since 2007. This approach was 
codified in revisions to the ESA implementing regulations in October 
2013.
    Economic impacts of designating critical habitat are weighed 
against the benefits of designating critical habitat. Based on our 
experience and analysis with other listed mussels in Arkansas and the 
Southeast Region, the data suggests that the average person will not 
incur any additional costs associated with critical habitat designation 
over and above that required by the listing unless they are required to 
avoid adverse modification of critical habitat.
  proposed critical habitat for neosho mucket and rabbitsfoot mussels
    The Service proposed listing the Neosho mucket as endangered and 
rabbitsfoot as threatened in October 2012 after identifying both 
species as candidates in 1984 and 1994 respectively. Designating 
critical habitat for the two mussels was proposed along with the 
listing. The proposed designation totals approximately 783 river and 
stream miles for both mussel species in Arkansas, as well as segments 
of rivers and streams in Alabama, Kansas, Kentucky, Illinois, Indiana, 
Mississippi, Missouri, Ohio, Oklahoma, Pennsylvania and Tennessee. 
Notably, Arkansas is one of the remaining strongholds for rabbitsfoot 
with many small and sizable populations, in part because of the Natural 
State's legacy of conservation and its commitment to stewardship. The 
proposed critical habitat is limited to the river itself, below the 
normal high water mark and not the watersheds. In Arkansas this is less 
than 8 percent of the State's total stream miles as defined by the 
Arkansas Department of Environmental Quality. This proposed designation 
underwent an independent peer review and was available for public 
comment for a total of 150 days to ensure it was based on the best 
scientific, commercial, and economic data available.
    The benefits of the final critical habitat designation for the two 
mussels will include public awareness of the presence of the mussels 
and the importance of habitat protection, and, where a Federal nexus 
exists, ensure there is no adverse modification of critical habitat. 
According to the Service's economic analysis of the critical habitat 
designation for both mussel species, the estimated cost for additional 
Federal actions because of the designation will be between $4.4 million 
and $5.9 million over 20 years. Most of those costs are administrative 
(i.e., costs of determining effects to the critical habitat and 
preparing a biological assessment) and will be borne largely by Federal 
agencies during required consultations with Service on the impacts of 
their actions.
    Federal agencies that fund, permit or perform actions that could 
negatively impact the protected mussels--or adversely modify their 
critical habitat--are required agency to consult with the Service under 
section 7(a)(2) of the ESA. Some of those activities might include 
building a dam or a road, or allowing a private logger to harvest trees 
from a National Forest. If the activity is likely to have an impact on 
the mussels or their critical habitat, the Service and the Federal 
agency work together through the informal or formal consultation 
process to ensure that the activity does not jeopardize the species or 
adversely modify the critical habitat and to find a reasonable 
conservation measures that would accomplish the goal of the project and 
conserve the species.
    The Service understands that designating critical habitat for 
Neosho mucket and rabbitsfoot has caused concerns for some Arkansans. 
We are listening and considering the concerns expressed about the 
proposed designation on the private sector in Arkansas, particularly on 
small businesses, industry, and agriculture. A critical habitat 
designation itself, without a Federal nexus, does not legally affect 
private landowners. The Service provided the public with three 
opportunities to submit comments on the proposed listing and critical 
habitat designation since it was announced in October 2012. We received 
49 comments and anticipate additional comments when the comment period 
for the proposed critical habitat designation is reopened for a fourth 
time. Public involvement into the Service's ESA actions ensures that we 
have the best available scientific and commercial data available. In 
the case of rabbitsfoot and Neosho mucket, we can substantiate that 
public involvement in the rulemaking process is working. For instance, 
the Association of Arkansas Counties provided the Service with 
additional scientific information to the Service during a public 
comment period. As a result, the Service evaluated the information and 
is modifying the proposal as appropriate.
    The Service has consulted with Federal agencies for decades on 
actions in Arkansas because of the presence of other listed mussels, 
such as the pink mucket and the winged mapleleaf, found in the same 
rivers as proposed critical habitat for the rabbitsfoot. The vast 
majority of the consultations were handled efficiently and informally 
by the Service's Arkansas Field Office. In fact, 99 percent of the 
consultations completed in the last 5 years with other Federal agencies 
such as the Natural Resources Conservation Service (NRCS) and Farm 
Service Agency were done in less than 30 days. These informal 
consultations did not delay any projects. This is important trend data 
that demonstrates a productive track record in Arkansas.
    The Service does not expect to require additional conservation 
measures for the proposed critical habitat for the two mussel species 
beyond those generated by the listing. We have indicated the final 
designation--expected later this year--would be smaller as a result of 
information shared during comment periods. The Service will soon 
announce an additional 60-day comment period on the proposed critical 
habitat designation and associated draft economic analysis. A final 
designation will consider all information received during the four 
public comment periods.
    The Service already is reviewing the direct, indirect and 
cumulative effects of Federal projects on the Neosho mucket and 
rabbitsfoot due to their listing in Arkansas rivers. For example, the 
Service informally consulted with Peco Foods on its plans to build a 
fully integrated poultry complex in Randolph and Clay Counties in 
northeastern Arkansas. The project required an Arkansas Pollutant 
Discharge Elimination System permit for the processing plant's proposed 
sewer outfall. The original plans proposed to discharge into a reach of 
the Black River where five federally protected mussel species are known 
to occur, including the rabbitsfoot. Possible ammonia concentrations 
below the outfall would likely have been too toxic for the mussels to 
survive. The Service worked with Peco Foods to determine the occurrence 
of federally protected mussels within the potential affected area. 
Surveys discovered a previously undocumented rabbitsfoot mussel bed 
near the proposed outfall and no federally protected species in an area 
upstream. As a result, Peco Foods was able to relocate its outfall to 
an alternate location 650 feet upstream of the original proposed 
location, which minimizes the impacts on the listed species. The 
cooperation between the Service and Peco Foods on the project's 
potential impact to listed species resulted in no delays in the 
permitting process and successfully avoided adverse effects to 
federally protected mussels.
    The Service has continued its communication with stakeholders in 
Arkansas regarding the effects of the proposed critical habitat 
designation for the two mussels since finalizing their listing in 
September 2013. We have engaged stakeholders including the Governor of 
Arkansas, county judges, industry associations, and others to further 
clarify our species listing actions and critical habitat and what they 
mean to Arkansans. The Service met with the staff of the entire 
Arkansas congressional delegation last November on this matter, and I 
personally met with Arkansas Attorney General and his staff in February 
2014 to discuss the implications of the proposed designation.
    Last month, the Director and I traveled to Little Rock to meet with 
numerous stakeholders including the Agricultural Council of Arkansas, 
Arkansas Chamber of Commerce, Arkansas Cattlemen's Association, 
Arkansas Farm Bureau, Arkansas Forestry Association, Arkansas Game and 
Fish Commission, Arkansas Secretary of Agriculture, Association of 
Arkansas Counties, and the oil and gas industry, as well as several 
county judges and State representatives. This meeting was a productive 
dialog with stakeholders on ESA actions where we answered questions and 
heard concerns about the size and implications of the proposed critical 
habitat designation and the way we consider economic impacts.
    We are committed to continuing this engagement with stakeholders in 
Arkansas and other affected States as we move forward in finalizing the 
critical habitat designation for the two mussel species. We are also 
committed to continuing to work closely with the Arkansas Game and Fish 
Commission on conservation actions for other species.
    engaging landowners in esa listing and critical habitat actions
    I first came to Arkansas to discuss many of these ESA-related 
issues with stakeholders in October 2012. I met with farmers, industry 
representatives, association groups such as the Association of Arkansas 
Counties and the Arkansas Forestry Association in Hot Springs to 
address concerns about impending listing decisions under our workplan. 
At that time, I informed them of the Southeast Region's plan to 
evaluate the need to list 61 candidates, including the Neosho mucket 
and rabbitsfoot, as well as Mega-Petition, one of the largest petitions 
ever received by the Service to list 404 aquatic and aquatic-dependent 
species found in the Southeast. Since then, the Service has continued 
to engage these stakeholders and others on not only the listing and 
critical habitat designation for the two mussels, as well as other 
listing actions.
    Between our listing workplan and other petitions under the ESA, the 
Southeast Region is required to evaluate whether more than 400 species 
need Federal protection. Of this total, 48 species occur in Arkansas. 
The Service's goal is to ensure, in working with partners, that 
sufficient conservation measures are in place such that these species 
would not warrant listing under the ESA. With the States leading the 
way and sound science as our guide, the Service and our partners--State 
agencies including the Arkansas Game and Fish Commission, other Federal 
agencies, universities, industries, and large private landowners--are 
prioritizing species and coordinating our resources. Partners are 
acquiring the best science, documenting conservation activities already 
taking place, and using voluntary, non-regulatory conservation programs 
to proactively conserve as many of these species as possible, so 
listing will not be necessary. The Service also is encouraging State, 
Federal, and private landowners to use voluntary conservation tools 
that protect private land interests and provide incentives and 
regulatory certainty for landowners to manage lands and waters in ways 
that benefit at-risk species. The Southeast Region is developing more 
than 20 voluntary conservation agreements covering many species, 
including one that would cover 28 at-risk cave species in Arkansas.
    Another part of the Service's at-risk conservation effort is that 
we are working closely with the Southeast Association of Fish and 
Wildlife Agencies' Wildlife Diversity Committee and moving aggressively 
to share expertise, available science and monitoring data that I 
believe is crucial to our efforts to evaluate the status of fish, 
wildlife and plants that are included in our listing workload. The 
States are leading the way, and I believe this expanded partnership 
will help us efficiently speed progress in our collective effort to 
achieve the conservation needed to render the listing of as a many 
species as possible unnecessary. Using the ESA proactively, it is 
possible to manage species in need and secure conservation as well as 
keeping working lands working.
    If together we can address the need to protect additional plants 
and animals without listing, landowners and the species benefit. From 
the landowner perspective, proactive conservation is voluntary and 
flexible while the ESA can be more rigid and includes regulatory 
requirements. Fish, wildlife and plants benefit when we focus limited 
resources where they are most needed. This helps species on a larger, 
landscape scale. Another benefit is counted in savings to the American 
taxpayer. In general, it costs less money to protect a species that is 
beginning to face threats than it does to recover critically endangered 
species.
    This collaborative effort with Federal and State agencies, 
industry, and private landowners is at work conserving at-risk species 
in Arkansas. The Service is developing voluntary agreements with the 
Arkansas Game and Fish Commission, NRCS, and The Nature Conservancy 
(TNC), including a Candidate Conservation Agreement with Assurances 
that includes 20 aquatic species. One example: The Service is part of a 
coalition of a dozen organizations and associations led by TNC, the 
Arkansas Farm Bureau, the Arkansas Game and Fish Commission and the 
Association of Arkansas Counties, to work collaboratively to develop 
simple best management practices to make it easier for the counties to 
maintain and repair rural, unpaved roads while reducing costs and 
improving water quality. This is important to us all because about 85 
percent of Arkansas county roads are unpaved. These roads are 
critically important to local economies and these actions may minimize 
erosion and improve the health of lakes and rivers. Reducing 
sedimentation, thereby improving water quality, from unpaved roads is 
key to conserving many of the aquatic species that need to be evaluated 
over next 5 years. We also support the use of voluntary conservation 
programs like those offered by the NRCS and the Service's Partners for 
Fish and Wildlife Program, to conserve and enhance fish and wildlife 
habitat, which are essential for helping preclude the need to list at-
risk species in Arkansas.
    This proactive conservation of at-risk species is starting to pay 
dividends, and we have determined that listing is not needed for nearly 
40 species--some based on new information, some on voluntary 
conservation actions, and some are already secure. For example, the 
Service recently announced that five southeastern crayfishes that occur 
in parts of Alabama, Georgia and Mississippi will not require Federal 
protection due to new scientific information. The crayfish species were 
withdrawn from the Mega-Petition and precluded needing to be listed. 
Our partnerships are growing, and we believe the ESA is working.
                               conclusion
    In closing, Mr. Chairman, I would like to emphasize the importance 
the Service places upon having a science-driven, transparent 
decisionmaking process in which people and businesses in affected 
communities can participate easily and effectively. The Service and I 
are committed to conserving America's fish and wildlife by relying upon 
strong partnerships and creative solutions to achieve conservation.
    Thank you for your interest in endangered species conservation here 
in Arkansas and the Southeast Region, and ESA implementation more 
generally. I appreciate the opportunity to testify here today in 
Batesville. I would be pleased to answer to any questions you and other 
members of the committee might have.

                                 ______
                                 

    The Chairman. Thank you very much for your testimony.
    I will now recognize Mr. Joe Fox, State Forester with the 
Arkansas Forestry Commission, from Little Rock.
    You are recognized for 5 minutes.

    STATEMENT OF JOE FOX, STATE FORESTER, ARKANSAS FORESTRY 
               COMMISSION, LITTLE ROCK, ARKANSAS

    Mr. Fox. Thank you, Mr. Chairman. Thank you for coming to 
Arkansas, and Representative Crawford, thank you for inviting 
and having this committee here.
    It is my pleasure to be here today to provide testimony on 
behalf of the Arkansas Forestry Commission and the State's 
private landowners, forest landowners, regarding the process of 
designating critical habitat. The Forestry Commission is 
dedicated to the conservation and wise development of the 
natural resources of our Nation and of our natural resource-
rich State. We are firmly committed to the ideal that through a 
strong partnership of public agencies and private citizens, 
those conservation efforts can be furthered to achieve a 
beneficial outcome for all.
    However, to effectively develop these partnerships, an open 
and candid dialog must occur between all parties that could be 
potentially impacted. I am going to use two examples to show 
where that process was not fully used and identify potential 
impacts to private landowners.
    The first example is the critical habitat designations for 
the Neosho Mucket and Rabbitsfoot Mussel. These critical 
habitat designations impact watersheds that include greater 
than 40 percent of the surface area of the State. Ninety 
percent of this land is privately owned. Approximately 75 
percent of the land is productive timber land that contributes 
in excess of $125 million annually to the economy of the State. 
There is a typo in my written comments right there; $125 
million is the correct number.
    The U.S. Fish and Wildlife Service, in conducting their 
economic impact analysis, concluded there would be limited cost 
impact to the private landowner as a result of the critical 
habitat designation. Fortunately, the Arkansas forest 
landowners that are contributing the $125 million annually 
mentioned previously will not experience any significant 
impacts to their ability to conduct timber operations.
    Through the use of the Arkansas Forestry Best Management 
Practices, over 89 percent of private forest landowners 
voluntarily promote and improve water quality when conducting 
forestry operations on their property.
    However, the second example I will use is the current 
proposed guidance for conservation measures being developed for 
the potential listing of the northern long-eared bat as an 
endangered species. They include maintaining the spring and 
summer, spring staging/fall swarming forested habitat within a 
5-mile radius of known or assumed long-eared bat hibernacula; 
the avoidance of clearing timber of suitable spring staging and 
fall swarming habitat within a 5-mile radius of the 
hibernacula; the avoidance of prescribed burning or other 
sources of smoke in known or assumed hibernacula during that 
swarming/staging season; and whenever possible, conducting 
prescribed fire outside of the summer maternity season; the 
avoidance of burning or other sources of smoke within a 
quarter-mile of known northern long-eared bat hibernacula 
during the hibernation season.
    The Fish and Wildlife Service describes forest habitat 
suitable for the northern long-eared bat as forest with trees 
greater than 3 inches diameter at breast height and typically 
greater than 66 percent canopy cover; although they also 
indicate that a single tree, if less than 1,000 feet from a 
known hibernaculum, is considered a potential roost. The NLEB 
hibernacula are potentially found everywhere in Arkansas, but 
especially in the Karst geology of North Arkansas.
    A single hibernaculum has an associated buffer of 50,000 
acres. A single hibernaculum has an associated annual timber 
value income of over $1 million. A single hibernaculum has an 
associated 625 potential private landowners. Logging could be 
greatly curtailed between April 1st and November 30. That is 
when we log in Arkansas, pretty much. And prescribed fire could 
be eliminated.
    Exclusion of logging and managing forest and prescribed 
fire would have a negative impact on wild turkey or bobwhite 
quail or the restoration of short-leaf pine forests. It could 
affect the entire State. Ninety percent of Arkansas is part of 
the range of the northern long-eared bat.
    The northern long-eared bat is in trouble because of white 
nose syndrome, which has nothing to do with critical habitat. 
It is a disease transported from bat to bat.
    This is a problem that really could sting the forest 
industry in Arkansas and private landowners, and we are quite 
worried about what could happen with the critical habitat 
designation for northern long-eared bat.
    Thanks for the opportunity to speak.
    [The prepared statement of Mr. Fox follows:]
   Prepared Statement of Joe Fox, State Forester, Arkansas Forestry 
                   Commission, Little Rock, Arkansas
    Mr. Chairman, members of the committee, it is my pleasure to be 
here today to provide testimony on behalf of the Arkansas Forestry 
Commission regarding the process of designating critical habitat. The 
Forestry Commission is dedicated to the conservation of the natural 
resources of our Nation and our State. We are firmly committed to the 
ideal that through a strong partnership of public agencies and private 
citizens those conservation efforts can be furthered to achieve a 
beneficial outcome for all.
    However, to effectively develop those partnerships an open and 
candid dialog must occur between all parties that could be potentially 
impacted. I am going to use two examples to show where that process was 
not fully used and identify potential impacts to private landowners.
    The first example is the recent critical habitat designations for 
the Neosho Mucket and Rabbitsfoot Mussel.

     These critical habitat designations impact watersheds that 
            include greater than 40 percent of the surface area of the 
            State.
     90 percent of this land area is privately owned.
     Approximately 75 percent of the land area is productive 
            timber land that contributes in excess of $325 million 
            annually to the economy of the State.

    The U.S. Fish and Wildlife Service in conducting their economic 
impact analysis concluded there would be limited cost impact to the 
private landowner as a result of the critical habitat designation. 
Fortunately, the Arkansas forest landowners that are contributing the 
$325 million mentioned previously will not experience any significant 
impacts to their ability to conduct timber operations. Through use of 
Arkansas Forestry Best Management Practices over 89 percent of private 
forest landowners voluntarily promote and improve water quality when 
conducting forestry operations on their property.
    The second example I will use is the current guidance for 
conservation measures being developed for the proposed listing of the 
northern long-eared bat (NLEB) as an endangered species.

     Maintain spring staging/fall swarming forested habitat 
            within a 5-mile radius of known or assumed NLEB 
            hibernacula.
     Avoid clearing of suitable spring staging and fall 
            swarming habitat within a 5-mile radius of known or assumed 
            NLEB hibernacula during the staging and swarming seasons.
     Avoid prescribed burning or other sources of smoke in 
            known or assumed NLEB habitat during the swarming/staging 
            or hibernation season, or coordinate with the local FWS 
            office.
     Whenever possible, conduct prescribed burns outside of the 
            summer maternity season. Burns conducted during the summer 
            maternity season should be low/moderate intensity to 
            minimize direct impacts to NLEB.
     Avoid burning or other sources of smoke within 0.25 mile 
            of known or assumed NLEB hibernacula during hibernation 
            season, or coordinate with the local FWS office.

    The Fish and Wildlife Service describes forest habitat suitable for 
the NLEB as forest with trees greater than 3 inches diameter at breast 
height and typically greater than 66 percent canopy cover. Although 
they also indicate that a single tree, if less than 1,000 feet from a 
known hibernaculum, is also considered a potential roost. NLEB 
hibernacula are potentially found everywhere in Arkansas, especially in 
the Karst geology of northern Arkansas.

     A single hibernaculum has an associated buffer of 
            approximately 50,000 acres.
     A single hibernaculum has an associated timber value of 
            $1.07 million in the buffer area.
     A single hibernaculum has an associated 625 potential 
            private landowners being impacted.
     Staging, maternity, and swarming season of the NLEB would 
            eliminate forest harvesting operations from April 1st 
            through November 30th.
     Presence of a hibernaculum would effectively eliminate 
            prescribed burning within the recommended 5-mile buffer 
            year round.
     The short seasonal migration distances of the NLEB and the 
            potential abundance of hibernacula could create a 
            continuous landscape that would be severely impacted by the 
            conservation measures proposed.
     Exclusion of prescribed burning activity in this area 
            would have a negative impact on maintaining habitat for 
            species such as the wild turkey.
     Exclusion of prescribed burning in this area would 
            significantly reduce efforts to restore native shortleaf 
            pine forests and associated species such as the northern 
            Bobwhite quail.
     Restriction of harvesting activity during the recommended 
            timeframe would severely disrupt the forest economy valued 
            at approximately $400 million dollars annually.

    The Fish and Wildlife Service is seeking to have the NLEB listed as 
a direct result of population decline due to White Nose Syndrome (WNS). 
The conservation measures proposed within the NLEB Interim Conference 
and Planning Guide are not directly related to WNS, but rather, to 
promote habitat conservation with a tenuous connection to increased WNS 
resistance. These measures are unrealistic in light of the negative 
impact they would have on forest landowners. The Arkansas Forestry 
Commission would encourage the Fish & Wildlife Service to engage in a 
dialog that would provide for development of conservation measures that 
can be implemented in a manner mutually beneficial to the NLEB and the 
forest landowners of the State of Arkansas.
    Again, I would like to thank the committee for this opportunity to 
provide comment regarding the process for designation of critical 
habitat by the Fish and Wildlife Service.

                                 ______
                                 

    The Chairman. Thank you very much, Mr. Fox, for your 
testimony.
    I will now recognize Mr. Gregory Hamilton, Ph.D., Senior 
Research Economist at the University of Arkansas Little Rock 
Institute for Economic Advancement.
    The gentleman is recognized for 5 minutes.

     STATEMENT OF GREGORY HAMILTON, Ph.D., SENIOR RESEARCH 
 ECONOMIST, UNIVERSITY OF ARKANSAS LITTLE ROCK, INSTITUTE FOR 
          ECONOMIC ADVANCEMENT, LITTLE ROCK, ARKANSAS

    Dr. Hamilton. Mr. Chairman, committee members, one could 
say that we have a conundrum because of the current 
interpretation of the Endangered Species Act. Society is trying 
to maximize the net social benefits of preserving endangered 
species that have social values but not well-defined monetary 
values, while considering only a select group of preservation 
costs.
    In such a situation, a counterfactual economic impact 
analysis underestimates the impacts of critical habitat 
designation, creating a potential misallocation of resources to 
preservation activities. However, including the full costs of 
preservation is to invalidate the Endangered Species Act.
    The economic impact analysis is a tool that shows how an 
event affects economic activity within an economy or between 
economies. An economic impact analysis uses causal models that 
trace the interrelationships between inter-industry 
expenditures and final demand expenditures. Economic impact 
models predict how a specific event or events can be expected 
to change output, income, and jobs within communities.
    An economic impact analysis of a critical habitat 
designation requires a counterfactual analysis. A 
counterfactual study simulates events that are contrary to the 
present situation. In the case of a critical habitat 
designation, the possible removal or limitation of economic 
activity must be considered by simulating the effects upon a 
study area by either removing or reducing the activity by an 
appropriate magnitude.
    Counterfactual questions that could be asked include: What 
would be the economic effects upon the counties in Arkansas 
that have a potential critical habitat designation if 
restrictions are placed on the use of area rivers and their 
surroundings? How could critical habitat designation effect 
road improvements, bridge improvements, timber and agricultural 
uses; recreational uses; water treatment and water quality 
investments; and mining, oil and gas operations, for example?
    Economic impact analysis must be defined in terms of some 
location or at some level of geography. The choice of geography 
is important since it establishes the study area, enabling a 
distinction between events that occur within the study area 
from those that are outside the study area. In the case of a 
critical habitat designation, a restriction of an activity like 
the loss of economic tourism can have economic impacts in a 
study area, but at the national level there are offsetting 
impacts.
    Often, U.S. Fish and Wildlife Service analyzes the economic 
impacts based upon Census-tract boundaries that include the 
designated areas. However, these areas may exclude many 
businesses and community interactions that are impacted by 
potential restrictions that may be imposed under the Endangered 
Species Act. In this case, a mis-specified study area results 
in an underestimate of the true economic impact.
    Regulations and restrictions have both allocative and 
distribution effects. Critical habitat designations may cause 
economic activity to simply relocate to other locations in the 
Nation. This is a local allocative effect that is offset by 
redistribution effect elsewhere, although there is no guarantee 
that redistributional effects will equal the allocative 
effects.
    Economic impact studies of critical habitat designation 
often presume that they are equal when they only consider 
consultation and administrative costs in their analysis.
    Road improvements and other economic development projects 
create wealth and well-being. The benefit from these 
improvements will not accrue to these communities if the 
projects are not built, so this is a net loss to the community 
regardless of whether or where the projects are eventually 
located. Many economic activities cannot simply be moved to 
alternative locations.
    The Endangered Species Act prohibits the use of economic 
considerations in the decision to list a species as endangered. 
At the time of listing an endangered species, the Endangered 
Species Act also requires the Fish and Wildlife Service to 
propose to designate a critical habitat. This decision can take 
into account considerations of probable economic impact 
designations.
    In the baseline incremental approach, the listing 
establishes the baseline, and the incremental costs are a 
consequence of the designation. The primary incremental costs 
are the consultation costs with Fish and Wildlife Service. 
Costs associated with the allocative and distribution effects 
are considered to be a consequence of the listing decision and 
are excluded from consideration.
    The coextensive approach contends essentially that the 
listing and the critical habitat designation are the same event 
focused on preserving an endangered species. As such, the 
resources committed to the preservation entail both the listing 
and the critical habitat designation and should be the focal 
point. An economic impact analysis based on the coextensive 
approach would have a fuller accounting of costs by 
incorporating both the designation and listing costs.
    A problem with the coextensive approach is that the 
Endangered Species Act requires listing decisions to be based 
solely on the best available science and commercial 
information. This is the same requirement that enables the 
baseline incremental approach to reduce the full cost of 
preserving endangered species by excluding the cost of listing 
from the economic impact analysis. Hence, we have a conundrum.
    Thank you.
    [The prepared statement of Dr. Hamilton follows:]
   Prepared Statement of Gregory L. Hamilton, Ph.D., Senior Research 
 Economist, University of Arkansas Little Rock, Institute for Economic 
                   Advancement, Little Rock, Arkansas
   What Would a True Economic Impact Analysis of a Critical Habitat 
                        Designation Incorporate?
    One could say that we have conundrum because of the current 
interpretation Endangered Species Act. We are trying to maximize the 
net social benefits of preserving endangered species that have social 
values but not well defined monetary values while considering only a 
select group of preservation costs. In such a situation a 
counterfactual economic impact analysis underestimates the impacts of 
critical habitat designation creating a potential over-allocation of 
resources to preservation activities. However, including the full costs 
of preservation is to invalidate the ESA.
                The Purpose of Economic Impact Analysis
    Economic impact analysis (EIA) is a tool that shows how an event 
affects economic activity within an economy or between economies. An 
EIA uses causal economic models that trace the interrelationships 
between interindustry expenditures and final demand expenditures. 
Economic impact models predict how a specific event or events can be 
expected to change output, income, and jobs within communities.
    The purpose of EIA is to analyze the effects of an event on a 
particular study area. EIA is often used in policy modeling to predict 
the consequences associated with a policy change such as tax rate 
change, infrastructure investments, or changes in environmental 
standards.
                Counterfactual Economic Impact Analysis
    An EIA of a Critical Habitat Designation (CHD) requires a 
counterfactual impact analysis. A counterfactual study simulates events 
that are contrary to the present situation. In the case of a CHD, the 
possible removal or limitation of economic activity must be considered, 
by simulating the effects upon a study area by either removing or 
reducing the activity by an appropriate magnitude. Counterfactual 
questions that could be asked include: What would be the economic 
effects upon the 34 counties in Arkansas that have a potential CHD if 
restrictions on the use of area rivers and their surroundings are 
placed? How would CHD effect road improvements, bridge improvements, 
timber and agricultural uses; recreational uses; water treatment and 
water quality investments; and mining, oil and gas operations for 
example.
   Economic Impact of a Critical Habitat Designation: Considerations
    EIA is an established method of analysis that traces it heritage 
back to 1758 and the French economist Francois Quesnay and, in modern 
times, Wassily Leontief in 1936 (Miernyk, W, 1966, pages 4-5). A 
unifying theme between these two economists is the emphasis they placed 
on economic interdependences. Economic interdependence results in 
several considerations that have significant consequences on the 
predictive power of an EIA. In an EIA the study area must be defined, 
and distinctions must be made between events that effect the allocation 
of resources as opposed to the distribution of resources.
    Economic interdependence between economic agents occurs across 
different geographical areas. Any EIA must be defined in terms of some 
location or at some level of geography. The geography may be at a 
county level, State level, national level, or combination of 
subnational geographic units. The limiting factor is often the 
availability of data. The choice of a geography is important since it 
establishes the study area enabling a distinction between events that 
occur within the study area from those that are outside the study area. 
In the case of a CHD, a restriction of an activity like the loss of 
economic tourism can have economic impacts in a CHD study area but at 
the national level there are offsetting impacts. In such a situation, 
at the national level there are no net economic impacts although the 
CHD area has a loss of economic activity.
    Often U.S. Fish and Wildlife Service analyzes the economic impacts 
of CHD based on Census-tract boundaries that include the designated 
areas. However, these areas may exclude many business and community 
interactions that are impacted by potential restrictions that may be 
imposed under the Endangered Species Act (ESA). In this case a 
misspecified study area results in an underestimate of the true 
economic impact. (HISTECON Associates, Inc., 2013, page 5)
    Allocative effects are resource using effects. The allocation of 
resources between alternative uses has economic costs in terms of what 
is forgone. This is the concept of economic cost or opportunity cost. 
Opportunity cost is the value of the best forgone alternative use for 
the resources. A distribution effect on the other hand focuses on who 
gets what. Concerns about fairness and equality are often the 
consequence of uneven distribution effects.
    Regulations and restrictions have both allocative and distribution 
effects. As already noted restriction resulting from a CHD may cause 
economic activity to simply relocate to other locations in the Nation. 
This is a local allocative effect that is offset by redistribution 
effect elsewhere. Although, there are no guarantees that distributional 
effects will equal the allocative effects. EIA studies of a CHD often 
presume that they are equal when they only consider consultation and 
administration costs in their analysis.
    Road improvements and other economic development projects create 
wealth and well-being. The benefit of these improvements will not 
accrue to these communities if the projects are not built, so this is a 
net loss to the community regardless of whether or where the projects 
are eventually located. Many of the economic activities cannot simply 
be moved to alternate locations. Prime examples of these are bridges, 
paving county roads, harvesting timber from previously cultivated tree 
stands, parks and recreation areas, and ``highest-in-structure'' 
drilling sites for natural gas. In each of these cases, the lost 
opportunity would be unavailable absolutely to any other location 
because of the unsuitability or non-comparability of the alternatives. 
They are foregone opportunities. (HISTECON Associates, Inc., 2013, page 
9)
 What is the Difference Between Coextensive Approach and the Baseline-
                         Incremental Approach?
    The Endangered Species Act (ESA) prohibits the use of EIA in the 
decision to list a species as endangered. The ESA also requires the 
Fish and Wildlife Service to concurrently or up to a year later propose 
to designate a critical habitat. The CHD decision can take into account 
consideration of probable economic impacts of the designation. (U.S. 
Fish and Wildlife Service, 2011)
    In the baseline-incremental approach, the listing of the endangered 
species establishes the baseline and the incremental costs are a 
consequence of the CHD. (Sinder, 2004, page 163) The primary CDH costs 
are the agencies consultation costs with the Fish and Wildlife Service. 
CHD's cost associated with the allocative and distribution effects are 
considered to be a consequence of the listing decision and are excluded 
from consideration in an EIA.
    The coextensive approach contends essentially the listing and the 
CHD are the same event focused on preserving an endangered species. As 
such the resources committed to the preservation entail both the 
listing and the CHD and should be the focal point of the EIA. One 
possible interpretation of the coextensive approach is that it views 
the ESA as a process where the baseline is the way the world was before 
the listing and the event would be the process of listing and obtaining 
CHD. An EIA based on this coextensive approach would have a fuller 
accounting of costs by incorporating both the costs of the CHD and 
listing costs.
    A problem with the coextensive approach is the ESA requires listing 
decisions to be based solely on the best available sciences and 
commercial information. This is the same requirement that enables the 
baseline-incremental approach to reduce the full economic costs of 
preserving endangered species by excluding the cost of listing from 
EIA.
    One could say that we have conundrum because of the current 
interpretation ESA. We are trying to maximize the net social benefits 
of preserving endangered species that have social values but not well 
defined monetary values while considering only a select group of 
preservation costs. In such a situation a counterfactual EIA 
underestimates the impacts CHD creating a potential misallocation of 
resources to preservation activities. However, including the full costs 
of preservation is to invalidate the ESA.
                               References
HISTECON Associates, Inc. 2013, ``Economic Analysis of Proposed 
Designation of Critical Habitat for Rabbitsfoot Mussels and Neosho 
Mucket in Arkansas,'' Arkansas Association of Counties, Little Rock, 
AR, September.

Miernyk, William, 1966. ``The Elements of Input-Output Analysis,'' 
Random House, New York.

Sinden, Amy, 2004, ``The Economics of Endangered Species: Why Less is 
More in the Economic Analysis of Critical Habitat Designations,'' 
Harvard Law Review, Vol. 28, pages 129-214.

U.S. Fish and Wildlife Service, 2011, ``Critical Habitat--What it is?'' 
Endangered Species Program, Fact Sheet, http://www.fws.gov/midwest/
endangered/saving/CriticalHabitatFactSheet.html.

                                 ______
                                 

    The Chairman. Thank you very much, Dr. Hamilton.
    I would next recognize Mr. Roland McDaniel, but he, I 
understand, has been delayed because of the weather and he is 
on his way, and hopefully we can get his testimony in before we 
break.
    So I will then go next to Mr. Gene Pharr, who is a farmer 
from Lincoln, Arkansas.
    Mr. Pharr, you are recognized.

       STATEMENT OF GENE PHARR, FARMER, LINCOLN, ARKANSAS

    Mr. Pharr. Good morning, Chairman Hastings and 
Representative Crawford. We appreciate you holding this meeting 
so we can talk about our concerns.
    I am Gene Pharr, and I raise poultry and beef in northwest 
Arkansas, where Benton and Washington Counties are proposed as 
critical habitat for the Neosho Mucket. We are the home to the 
corporate headquarters of Wal-Mart, Tyson Foods, J.B. Hunt, and 
a fast-growing population. Yet, Benton and Washington County 
still rank number 1 and 2 in all livestock production in our 
State.
    We believe that critical habitat designation will lead to 
unwarranted lawsuits and litigation against private landowners, 
with little risk placed on those who filed the lawsuit since 
the U.S. Government picks up the legal fees for those filing 
the lawsuit.
    There are several examples of this overreach despite the 
declaration that private lands would not be overburdened by the 
critical habitat designations. We have already seen several 
examples of that, however.
    The dusky gopher frog occupies habitat in Mississippi, 
though frogs are not currently present in Louisiana, nor have 
they been for more than 50 years. The Endangered Species Act 
defines critical habitat as the specific areas within the 
geographic area occupied by the species at the time it is 
listed. Yet, the U.S. Fish and Wildlife Service designated more 
than 1,500 privately owned acres in Louisiana as critical 
habitat that just happened to be adjacent to the habitat in 
Mississippi. While there are no current development plans for 
that property, the forest is a managed farm. The private 
landowners have been prohibited from harvesting timber due to 
this critical habitat designation. This appears to be an 
arbitrary attempt to stop the harvesting of timber on private 
land under the guise of limiting potential future development.
    In California, the Castaneda family raises irrigated row 
crops, including strawberries. The family decided to convert 
their farm into vineyards, which requires deep ripping of the 
ground before they are able to plant their grapevines. Their 
farm happened to be in a critical habitat area for the 
California tiger salamander, which lives in burrows or holes. 
Sonoma County advised the family to contact U.S. Fish and 
Wildlife.
    Consultation with U.S. Fish and Wildlife Service was not 
part of the approved development permitting process, and since 
the farmers had never seen the species on their property, they 
proceeded with the ground preparation. A citizen's group saw 
the family ripping up the ground and filed suit. The Castanedas 
are now tied up in a legal battle and are bound up in what 
could be years of permitting and litigation costs.
    While several States have recently gained the right to use 
the herbicide Enlist, Arkansas is still not included in the 
EPA's approved list. We understand that one of the reasons 
Arkansas has not been endorsed for the Enlist usage is because 
of the pending critical habitat designations. We believe we are 
at this point because of the close relationship between the 
Center for Biological Diversity and the U.S. Fish and Wildlife 
Service. They agreed to a stipulated settlement that not only 
listed certain species as endangered but required the 
designation of critical habitat as a part of the listing. This 
new development essentially streamlines the overall listing 
process, opening the door for non-government organizations, 
like the Center for Biological Diversity and Wild Earth 
Guardians, to come into Arkansas and the South and Southeast 
and basically extort private landowners through litigation or 
the threat of litigation.
    Those of us who farm in northwest Arkansas operate under 
some of the most significant regulatory constraints in the 
country. You can likely understand that the threat of any 
additional regulation would be viewed with skepticism and a 
fair amount of concern.
    Allow me in my conclusion to offer my additional support 
for Congressman Crawford's bill, H.R. 4319, the Common Sense in 
Species Protection Act of 2014. Thank you for your time and 
consideration of these comments.
    [The prepared statement of Mr. Pharr follows:]
 Prepared Statement of Gene Pharr, Poultry Farmer, Board of Directors, 
                          Arkansas Farm Bureau
    Good morning. I appreciate the opportunity to be here this morning 
and to share the concerns of some of the farmers and ranchers in my 
part of the State.
    I am Gene Pharr, and I raise poultry and beef in northwest 
Arkansas, where Benton and Washington counties are proposed as critical 
habitat for the Neosho Mucket.
    We are home to the corporate headquarters of Wal-Mart, Tyson Foods, 
J.B. Hunt and a fast-growing population. Yet Benton and Washington 
counties still rank No. 1 or No. 2 in all livestock production in our 
State.
    We believe the critical habitat designation will lead to 
unwarranted lawsuits and litigation against private landowners, with 
little risk placed on those who file the lawsuit, since the U.S. 
Government picks up the legal fees for those filing the lawsuit.
    There are several examples of this overreach, despite declarations 
that private lands would not overburdened by the critical habitat 
designations. We have already seen several examples of that, however.
    The Dusky Gopher Frog occupies habitat in Mississippi, though frogs 
are not currently present in Louisiana nor have they been for more than 
50 years. The ESA explicitly defines critical habitat as the ``specific 
areas within the geographic area occupied by the species at the time it 
is listed.'' Yet the USFWS designated more than 1,500 privately owned 
forested acres in Louisiana as critical habitat that just happen to be 
adjacent to the habitat in Mississippi. While there is no current 
development plans for this property, the forest is a managed timber 
farm. The private land owners have now been prohibited from harvesting 
timber due to this critical habitat designation. This appears to be an 
arbitrary attempt to stop the harvesting of timber on private land 
under the guise of limiting potential future development. The cost of 
the potential future development has been estimated to be upward of $30 
million, according to USFWS.
    In California, the Castaneda family raises irrigated row crops, 
including strawberries. The family decided to convert their farm into 
vineyards, which requires deep ripping of the ground before they are 
able to plant their grape vines. Their farm happened to be in a 
critical habitat area for the California Tiger Salamander, which lives 
in burrows or holes. Sonoma County advised the family to contact USFWS. 
Consultation with USFWS was not part of the approved development 
permitting process, and since the farmers had never seen the species on 
their property, they proceeded with ground preparation. A citizen group 
saw the family ripping the ground and filed suit. The Castanedas are 
now tied up in a legal battle and are bound up in what could be years 
of permitting and litigation costs.
    In Arkansas, we are excluded from the EPA's approved list for the 
herbicide Enlist. While several States have recently gained the right 
to utilize Enlist, EPA has cited the need for more studies in Arkansas 
because of the critical habitat areas that have been designated.
    We are at this point now because of the close relationship between 
the Center for Biological Diversity and the USFWS. They agreed to a 
stipulated settlement that not only listed certain species as 
endangered, but required the designation of critical habitat as part of 
the listing. This new development essentially streamlined the overall 
listing process, opening the door for non-government organizations like 
the Center for Biological Diversity and Wildearth Guardians to come 
into Arkansas, the South and Southeast and, basically, extort private 
land owners through litigation, or the threat of litigation.
    Those of us who farm in northwest Arkansas operate under some of 
the most significant regulatory constraints in the country. You can 
likely understand then that the threat of any additional regulation 
would be viewed with skepticism and a fair amount of concern.
    Allow me, in conclusion, to offer my additional support for 
Congressman Crawford's bill, H.R. 4319, the Common Sense in Species 
Protection Act of 2014.
    Thank you for your time and your considerations of these comments.

                                 ______
                                 

    The Chairman. Thank you very much, Mr. Pharr.
    I see that Mr. McDaniel has joined us.
    Would you like me to go to another witness before you, or 
are you absolutely prepared to proceed?
    Mr. McDaniel. I am ready to proceed.
    The Chairman. In that case, Mr. McDaniel, we will recognize 
you. You are the Principal and Senior Scientist for GBMc & 
Associates, from Bryant, Arkansas.
    You are recognized for 5 minutes.

STATEMENT OF ROLAND McDANIEL, PRINCIPAL, SENIOR SCIENTIST, GBMc 
                 & ASSOCIATES, BRYANT, ARKANSAS

    Mr. McDaniel. Thank you, Representative. My name is Roland 
McDaniel. I am a partner and senior scientist with GBMc and 
Associates, an environmental consulting firm located in Bryant, 
Arkansas. I have over 34 years of experience as an aquatic 
biologist in the State of Arkansas, first as a regulator at the 
State agency and the last 22 years as a private consultant. I 
have a B.S. degree in wildlife and fisheries management and a 
Master's degree in biology with a focus on aquatic ecology. My 
Master's thesis was a comprehensive life study assessment of 
the Yellowcheek Darter, Etheostoma moorei, which is now an 
endangered species in Arkansas. So in some way, I have been 
dealing with threatened and endangered species for over 38 
years.
    The U.S. Fish and Wildlife Service proposed critical 
habitat for the Rabbitsfoot Mussel and Neosho Mucket in October 
of 2012. The comment period for the proposed action was 
extended and reopened for an additional 60-day comment period 
to end October 28, 2013. The strains included in the critical 
habitat units directly impact 30 counties, 28 for the 
Rabbitsfoot Mussel and two for the Neosho Mucket. Should all 
the proposed critical habitat units be adopted as proposed, the 
targeted watersheds cover approximately 42 percent of the 
geographical area of Arkansas as indicated by the map.
    The Endangered Species Act defines a threatened and 
endangered species as follows. Threatened species are any 
species which are likely to become an endangered species within 
the foreseeable future. An endangered species is any species 
which is in danger of extinction throughout all or a 
significant portion of its range.
    As stipulated in the Environmental Species Act, the U.S. 
Fish and Wildlife Service, herein referred to as the Service, 
is required to identify critical habitat required to support 
the designated species. Critical habitat is defined in Section 
3 of the Endangered Species Act as: one, specific areas within 
a geographic area occupied by the species at the time of the 
listing in accordance with the Act and on which are found those 
physical or biological features to points essential to the 
conservation of the species and which may require special 
management consideration or protection; two, the specific areas 
outside the geographical area occupied by the species at the 
time of its listing upon a determination that such areas are 
essential for the conservation of the species. These two points 
are quite critical, and we feel like the Service and the 
designation of the critical habitat, particularly for the 
Rabbitsfoot Mussel, went far outside the scope of those 
indicated as required for critical habitat.
    According to the Species Service Assessment Form, which 
they use in designating a species, the Rabbitsfoot Mussel had 
an LPN of 9, which indicates threats are moderate, and this was 
first concluded in 1996 when it was first considered for 
listing. That listing was rescinded, or the consideration was 
rescinded, and additional information developed up to and 
through 2010, that LPN of 9 did not change. Nine is the highest 
number out of 12, with an LPN of 1 being the lowest, which 
means the most critical.
    The LPN assessment of 9 indicates threats are of a moderate 
magnitude and the threats are non-imminent, most are ongoing, 
and the threats are imminent overall. The listing of the LPN of 
9 is the lowest in the imminent category. In other words, it is 
the lowest of those which are determined to be a candidate for 
listing.
    The status report ultimately categorized the condition or 
population of the Rabbitsfoot Mussel throughout the multi-State 
range of the Rabbitsfoot Mussel, often an opinion comparing 
limited qualitative data to determine population status. Butler 
in 2005 categorized the extant population based on mostly 
qualitative information, comparing recent survey data post-2000 
largely to qualitative data provided in the historical 
documentation.
    Several stream segments in Arkansas that were once thought 
to no longer harbor or support viable Rabbitsfoot Mussels have 
recently been determined to harbor populations, and we will 
talk more about that later. This information is currently in 
press based on information from the Arkansas Game and Fish 
State malacologist, and the new information really begs the 
question: Was the Service justified in its designation of the 
Rabbitsfoot Mussel as a threatened species, especially if there 
are other populations one or more of the other States have not 
yet determined to exist or accounted for?
    The Neosho Mucket, on the other hand, identified as a 
candidate in 1984--and we agree and had no comments related to 
that listing.
    The critical point of the species listing of critical 
habitat----
    The Chairman. Mr. McDaniel, I know you weren't here for the 
opening, but we asked you to keep your oral remarks within 5 
minutes. Your full statement will appear in the record, and 
that is what that timing light is there for. So if you could 
wrap it up here in another 10 seconds, I would appreciate it 
very much.
    Mr. McDaniel. OK. We think that the Service greatly 
overstepped its boundaries. One of the key points that is not 
indicated is the listing of the critical habitat provides a 
roadmap not only for the Service but also for outside entities 
such as the Center for Biological Diversity to bring lawsuits 
against not only business entities but also individuals who 
they think have resulted in a taking due to individual actions 
on land that they own specifically.
    Thank you.
    [The prepared statement of Mr. McDaniel follows:]
  Prepared Statement of Roland E. McDaniel, Senior Scientist, GBMc & 
                      Associates, Bryant, Arkansas
1.0 INTRODUCTION

    My name is Roland E. McDaniel. I am a Partner and Senior Scientist 
with GBMc and Associates, an environmental consulting firm located in 
Bryant, AR. I have over 34 years of experience as an aquatic biologist 
in the State of Arkansas, first as a regulator with the State agency 
(Arkansas Department of Environmental Quality) and the last 22 years as 
a private consultant. I have a B.S. degree in Wildlife and Fisheries 
management and a M.S. degree in biology with a focus on Aquatic 
Ecology. My masters thesis was a comprehensive life history assessment 
of the Yellowcheek Darter (Etheostoma moorei), which is now an 
endangered species in Arkansas. So in some way I have been dealing with 
threatened and endangered species for over 38 years.
    The Arkansas Association of Counties contracted with GBMc and 
associates to review the scientific basis and justification for the 
proposed critical habitat (CH) designation. The following testimony is 
a result of that effort and will focus on:

     Background for the proposed CH designations,

     A consideration of the service definition of Occupied 
            Habitat,

     Physical and biological features required by the 
            Rabbitsfoot mussel,

     Summaries the CHU proposed for the Rabbits foot mussel in 
            Arkansas,

     Streams considered but not yet proposed as critical 
            habitat, and

     Potential ramifications of the proposed action.

    Additional details, maps and tables supporting this testimony can 
be found in the document at the end of this written testimony. (GBMc, 
2013, Review of Proposed Critical Habitat Designation for Rabbitsfoot 
Mussel (Quadrula cylindrical cylindrical) and Neosho Mucket (Lampsilis 
rafinesqueana).

2.0 BACKGROUND

    The U.S. Fish and Wildlife Service (Service) proposed critical 
habitat for the Rabbitsfoot Mussel (Quadrula cylindrical cylindrical) 
and the Neosho Mucket (Lampsilis rafinesqueana) on October 16, 2012. 
The comment period for the proposed action was extended and reopened 
for an additional 60-day comment period to end October 28, 2013. The 
proposed critical habitat for the Rabbitsfoot Mussel included 1,654 
river miles across 15 States. The proposed action designating critical 
habitat for these two mussel species proposed 13 habitat units across 
Arkansas covering approximately 800 river miles (approximately 48 
percent of the total proposed).
    The streams included in the critical habitat units directly impacts 
30 counties (28 Rabbitsfoot Mussel and 2 Neosho Mucket). Should all the 
proposed critical habitat units be adopted as proposed, the targeted 
watersheds cover approximately 42 percent of the geographical area of 
Arkansas.
    The Service Species Assessment and Listing Priority Assignment Form 
are used by the Service to evaluate the species being proposed for 
action under the Endangered Species Act (ESA). The form for the 
Rabbitsfoot Mussel was approved on June 4, 2008 by the Regional 
Director and concurred by the Acting Director on October 29, 2009. This 
document provides a summary of information related to the distribution, 
biology, threats to the species, rational for proposed listing and a 
ultimately a ``listing priority'' number.
    The Rabbitsfoot Mussel was first identified as candidate in 
November 15, 1994 (59 FR 58982). At which time the species was assigned 
a category 2 until 1996 (61 FR 7596) when the listing was discontinued 
due to lack of information. The Rabbitsfoot Mussel was added to the 
candidate list again in the November 9, 2009 (74 FR 57804) with a 
Listing Priority Number (LPN) of 9 (out of 12), indicating threats 
determined to be moderate magnitude but imminent overall. The notice 
dated November 10, 2010 (75 FR 69222) again listed the Rabbitsfoot 
Mussel as candidate species and again with a LPN of 9. Even with the 
additional information developed after Butler (2006) from 2006-2010, 
there was no change in the priority ranking of 9 out of 12, with a LPN 
of 1 being the most urgent listing priority.
    According to the Service Assignment form an LPN of 9 indicates 
threats of a moderate magnitude; some of the threats are non-imminent, 
most are ongoing, and the threats are imminent overall. An LPN of 9 is 
the lowest in the imminent category. A LPN of 10 would indicate non-
imminent condition. This listing is rather subjective and has resulted 
due to the ``reduction in range and most of its extant populations are 
declining and /or isolated'' (77 FR 63476). This assessment was based 
largely on Butler (2005), the status report for the Rabbitsfoot Mussel. 
This status report ultimately categorized the condition of populations 
throughout the multi-State range of the Rabbitsfoot Mussel often as an 
opinion comparing limited qualitative data to determine population 
status. Butler (2005) categorized extant populations based on 
``qualitative information'' comparing recent survey data, post 2000, to 
largely qualitative descriptors provided in the historical 
documentation.
    As provided later in this testimony, several stream segments in 
Arkansas that were once thought to no longer support viable populations 
of the Rabbitsfoot mussel, have recently (2012-2013) been determined to 
harbor populations. This information is currently in press (personal 
communication with Bill Posey, Arkansas Game and Fish Commission State 
Malacologist, 2013). This new information begs the question. ``Was the 
Service justified in its designation of the Rabbitsfoot mussel as a 
threatened species, especially if there are other populations one or 
more of the other 14 States not yet accounted for?''
    The Neosho Mucket was first identified as candidate species on May 
22, 1984 (49 FR 21664) status 2 category until 1996. The designation 
was discontinued due to lack of information. It was relisted as a 
candidate in October 30, 2001 (66 FR 54808). The 2001 listing priority 
assigned was 5 (out of 12). Listing priority was reassessed in 2010 and 
changed from 5 to 2, indicating threats to the conservation of the 
species were imminent and high in magnitude.

3.0 OCCUPIED HABITAT

    In the determination of critical habitat units, the Service chose 
to expand the definition of critical habitat to include stream segments 
which had not been demonstrated to harbor populations of the target 
species (Rabbitsfoot Mussel and Neosho Mucket). As provided in the 
proposed listing (77 FR 63475) the Service provides that:

        ``Therefore, where one occurrence record was known from a river 
        reach, we considered the entire river reach between the 
        uppermost and lowermost locations as occupied habitat except 
        lakes and reservoirs.''

    These definitions and their application in the determination of the 
proposed Critical Habitat Units (CHU) raised three primary 
considerations that are not supported including:

     The proposed CHU includes long distance stream segments, 
            large portions of some of which have not been documented to 
            harbor and/or support the target species,

     Portions of selected CHU demonstrate conditions (e.g. 
            hypolimnetic releases and year round reduced water 
            temperatures) that are not conducive to mussel population 
            development and are not supportive of the target species 
            considered in this proposal, and

     That the entire river reach provides critical habitat 
            ESSENTIAL to the conservation of the individual species 
            implies that critical habitat identified as necessary for 
            Rabbitsfoot Mussel (both substrate and flow refugia) occurs 
            in the entire proposed reach.

4.0 PHYSICAL OR BIOLOGICAL FEATURES OF CRITICAL HABITAT FOR THE 
        RABBITSFOOT MUSSEL

    In describing the required habitat types, the proposed critical 
habitat descriptions provide that:

        ``Although little is known of the specific habitat requirements 
        for the Neosho Mucket and the Rabbitsfoot Mussel it can be 
        determined that they require flowing water, geomorphically 
        stable river channels and banks with suitable substrate, 
        adequate food, the presence and abundance of fish hosts, 
        adequate water and sediment quality, and few or no competitive 
        or predaceous invasive (nonnative) species'' (page 3 of Draft 
        Environmental Assessment).

        Comment: If little is known about the specific habitat 
        requirements for these species, critical habitat designations 
        may be too broad. There is simply not enough information to 
        make an accurate critical habitat designation.

    Preferred hosts of the Rabbitsfoot Mussel based on Yeager and Neves 
(1986) and Fobian (2007) are Cyprinella galacturus, Cyprinella 
venustus, Cyprinella spilopterus, and Hybopsis amblops.

        Comment: As illustrated in the Fishes of Arkansas (Robinson and 
        Buchanan, 1988) species distribution of these fish species is 
        predominately relegated to the northern portion of the State. 
        While populations of the Rabbitsfoot Mussel exist in the 
        Saline, Ouachita, and Little Rivers, it seems most appropriate 
        to designate critical habitat in areas where successful host 
        species and the Rabbitsfoot Mussel coexist in the northern 
        portions of Arkansas.

    Several of the proposed critical habitats are located within the 
influence of hypolimnetic (cold water) discharges from reservoirs or 
spring dominated flows. Vaughn and Taylor (1999) reported extinction 
gradients downstream of impoundments, contributing this reduction of 
mussels to altered flow regimes and reduced water temperatures.

        Comment: The critical habitats proposed in streams that are 
        impacted/controlled by hypolimnetic or other cold water 
        releases are not preferred habitats for the Rabbitsfoot Mussel 
        and should be removed for the proposed critical habitat units.

    Additionally, Butler (2005) often used the condition of patchy 
distribution of individual populations as a reason to characterize the 
status as declining. This apparent patchy distribution does occur and 
is routinely reported in survey results, often demonstrated as 
collections of the Rabbitsfoot Mussel in clustered sites and excluded 
from long reaches within the proposed CHU. The ``patchy distribution'' 
reflects the natural selection by the Rabbitsfoot Mussel to selectively 
occupy habitats that allow ``rabbitsfoot to remain in the same general 
location throughout their entire lives. These patches of stable habitat 
may be highly important for the rabbitsfoot since it is typically does 
not burrow, making it more susceptible to displacement into unsuitable 
habitat'' (77 FR 63472). Therefore, the patchy distribution is not an 
indication of population status but actually a function of habitat 
selection by the Rabbitsfoot. The Rabbitsfoot mussel has been described 
by as a ``habitat specialist'', roughly translated to mean that the 
Rabbitsfoot prefers a very special habitat type and is not generally 
distributed throughout the streams it inhabits.
    Last, Butler (2005), and the public notice of proposed critical 
habitat relied extensively and quoted frequently personal opinions in 
the assessment of current population conditions which were not and 
cannot be substantiated.

5.0 CRITICAL HABITAT UNITS (CHU) PROPOSED FOR ARKANSAS (LISTED FROM 
        LONGEST TO SHORTEST)

    The Rabbitsfoot Mussel is fairly widespread in Arkansas streams. 
Several ``robust'' populations are found throughout Arkansas: the White 
River, Black River, Spring River, Ouachita River, Saline River, and 
Little River. According to Harris et al. (2009), there are large 
populations in the Spring and Black Rivers.
    The proposed modifications seek to reduce the total critical 
habitat less to approximately one-third of the 800 river miles that 
proposed. After review of the basis for the proposed designation of the 
12 CHU, comments are provided to modify 6 of the 12 proposed CHU 
including:


     Saline River.........  Proposed CHU RF5, from 179.2 river miles (RM) to approx. 50 rm,
 
     Ouachita River.......  Proposed CHU RF4b from 98.1 rm to approx. 15 rm,
 
     Black River..........  Proposed CHU RFb from 57.2 rm to approx. 25 rm,
 
     Spring River.........  Proposed CHU RF10 from 39 rm to approx. 20 rm,
 
     Ouachita River.......  Proposed CHU RF4a delete the total CHU of 13.6 rm, and
 
     SF Spring River......  Proposed CHU RF11 delete the total CHU, 10.2 rm.
 


    There are no comments or recommended changes to the other 6 CHU.

    The following section provides highlights of each proposed 
modification of the CHU. The summary provides percent ownership of 
riparian habitats, an overview of the stated basis for the designation 
as proposed critical habitat, and comments justifying proposed 
modifications to the individual CHU.

5.1 Saline River Proposed CHU RF5 Reach Length--179.2 River Miles

     92 percent of riparian areas privately owned;

        Comment: Critical habitat should be reduced to account for the 
        area where populations identified with supporting 
        documentation, Propose a reduction of the Saline River critical 
        habitat unit modified from 179.2 river miles to approximately 
        50 river miles, where populations actually exist

5.2 Ouachita River Lower Reach--Proposed CHU RF4b--Reach Length 98.1 
        River Miles

     100 percent of riparian habitat privately owned;

        Comment: The hypolimnetic (cold water) releases from the 3 
        mainstem Ouachita River reservoirs (that is reinforced by 
        releases from Caddo River impoundment entering Ouachita River 
        at Arkadelphia), limits the development of the Rabbitsfoot 
        Mussel and does not represent critical habitat for the 
        Rabbitsfoot Mussel. Therefore the critical habitat of this 
        reach should be modified to include the Ouachita River where 
        populations of the Rabbitsfoot Mussel have been quantified.

5.3 Black River--Proposed CHU RF9--57.2 River Miles

     86 percent of riparian habitat privately owned;

        Comment: Documentation of existing populations in the Black 
        River but not downstream of Black Rock, therefore the CHU 
        should be modified to include the Black River from Pocahontas 
        downstream to Black Rock.

5.4 Spring River--Proposed CHU RF10--39 River Miles

     Riparian Habitat 100 percent privately owned;

     Rabbitsfoot routinely documented in Spring River 
            downstream of Ravenden, AR, but not upstream of that point; 
            and

     Water temperatures of Spring River controlled by spring 
            fed source (reduced temperature adversely impacts 
            reproduction/development of warm water mussel species). 
            Water temperatures and flow conditions not supportive of 
            species upstream of Ravenden, AR.

        Comment: Due to decreased water temperatures resulting for the 
        spring fed source and 2007 survey that identified upstream 
        extent of populations, the CHU for the Spring River should be 
        modified.

5.5 Ouachita River--Upper Reach--Proposed CHU RF4a--13.6 River Miles

     Riparian Habitat approximately 82 percent privately owned;

     AGF mussel database indicated three listed collections 
            from 1988 (one relic shell and 3 live mussels) nothing 
            before or after;

     No other documented occurrence;

     13.6 river mile CHU not essential for the conservation of 
            the species, and not confirmed as present at listing.

        Comment: CHU should be eliminated based on lack of 
        documentation, limited population, not documented at time of 
        listing, and isolation by main stem reservoirs

5.6 South Fork Spring River--Proposed CHU RF11--10.2 River Miles

     2002 initial documentation dead and relics only, no live 
            mussels;

     2003 intensive survey failed to document presence (Marten, 
            et. al, 2009);

     Single live specimen identified just upstream AR Hwy 289 
            (Harris, 2007 et. al); and;

     Small watershed and limited reach size (10.2 river miles) 
            and lack of documented population prevents this CHU from 
            meeting the ``essential for conservation of the species'' 
            requirement for being adopted as a CHU.

        Comment: The CHU RF11 should be eliminated from further 
        consideration.

6.0 CONSIDERED BUT NOT PROPOSED AS CRITICAL HABITAT FOR RABBITSFOOT 
        MUSSEL

    The following waterbodies were evaluated as potential critical 
habitats for the Rabbitsfoot Mussel, however they were not included in 
the previous proposed action for various reasons:

  1.  Illinois River

  2.  Current River

  3.  Cassatot River

  4.  Little Missouri River

  5.  War Eagle Creek

    It is likely that some or all of these waterbodies will be proposed 
as critical habitat in the new public slated for release in the near 
future. The addition of these stream segments will only increase the 
``footprint'' of the watersheds impacted by the proposed CH 
designation.
    Also, the addition of ``newly'' discovered viable populations 
should call into the ultimate question related to the necessity of 
listing at all.

7.0 NEOSHO MUCKET

    The Neosho Mucket is estimated to be extirpated from approximately 
62 percent of historical range with only 9 of 16 historical populations 
remaining, and only one of those listed as the remaining large viable 
population.

        Comment: No proposal to modify the proposed CHU.

8.0 FACTORS NOT CONSIDERED IN THE INCREMENTAL COST ANALYSES

    The following actions were not considered in the ``cost analyses'' 
but are true cost associated with the proposed action.

8.1 Cost to Small Business

    There are several dischargers into the proposed CHU that are 
regulated through the National Pollutant Discharge Elimination System 
(NPDES) permit system as administered by ADEQ. As provided in there are 
29 direct discharges and 91 indirect dischargers into the proposed CHU. 
As a result of the designation of the CHU, these discharge permits will 
be subjected to an increased level of regulation, including potential 
need for formal and/or informal consultation with the Service to 
determine the potential for effects on the listed species and the 
critical habitats.

        Comment: While the draft economic assessment (DEA) takes into 
        account potential costs to small businesses for consulting and 
        permitting purposes, the proposed critical habitat designation 
        does not take into account the full cost of project delays due 
        to permit issues and modifications or the cost for implementing 
        conservation measures determined necessary by the Service.

8.2 Blueprint for Litigation

    The designation of the critical habitat over large reaches of 
stream segments provides a road map or a blueprint for those 
individuals and/or groups looking to profit from the government 
regulation. Theses CHU designations will result in litigation against 
private landowners and businesses for lawsuits claiming a ``take'' of 
the protected regardless whether there is basis for the claim or not. 
GBMc experienced this first hand in assisting an individual to defend 
his actions in a tributary of the South fork of the Little Red River, 
designated as habitat for the Yellowcheek darter.

                                 ______
                                 

    The Chairman. Thank you very much, Mr. McDaniel, and I am 
sorry I had to interrupt you, but we are trying to keep it on 
track here.
    I now would like to recognize Mr. Randy Veach, who is the 
President of the Arkansas Farm Bureau based out of Little Rock.
    Mr. Veach, you are recognized for 5 minutes.

  STATEMENT OF RANDY VEACH, PRESIDENT, ARKANSAS FARM BUREAU, 
                     LITTLE ROCK, ARKANSAS

    Mr. Veach. Mr. Chairman, thank you for being here in 
Arkansas, and thanks to Rick Crawford, Congressman Crawford, 
for requesting the field hearing and getting it here in 
Arkansas so that we could express our views to you.
    My name is Randy Veach. I am a third-generation row crop 
farmer from rural Mississippi County. I am serving in my sixth 
term as President of Arkansas Farm Bureau, which is the State's 
largest agriculture advocacy organization.
    I appreciate the opportunity to speak to you this morning 
on behalf of the farmers and the ranchers and private 
landowners who will be adversely affected by the critical 
habitat designation being proposed as part of the Endangered 
Species Act.
    I speak especially about the U.S. Fish and Wildlife 
Service's over-protection of two aquatic species, the Neosho 
Mucket and the Rabbitsfoot Mussel.
    We want to express our support also for Congressman 
Crawford's bill, H.R. 4319, the Common Sense--and really, that 
is what we need to be looking at is common sense--in Species 
Protection Act of 2014, which amends the Endangered Species Act 
to require government agencies in charge of determining 
critical habitat designation, such as Fish and Wildlife, to 
perform a true analysis of how such a designation will affect 
the areas, lives and livelihoods, and that is what we are 
talking about.
    This issue involving critical habitat is very important to 
Arkansas, and I am going to tell you just exactly how important 
it is. There are more than 700 miles of rivers and streams in 
our State connected to this proposed critical habitat. Thirty-
one counties are affected. Roughly 90 percent of these river 
miles pass through private property, and that is a 
disproportionate impact on productive land.
    In this area, Arkansas has more than 21,000 family farms, 
7.4 million acres of farmland, more than $2.9 billion worth of 
agriculture income, which accounts for over a half-a-million 
jobs, a half-a-million jobs. Farmers in these areas produce 
more than 78 million broiler chickens, more than 6 million 
laying hens, 606,000 acres of rice, 780,000 acres of soybeans, 
8.6 million acres of forestland, and thousands and thousands of 
head of cattle.
    This area in Arkansas represents almost half of the 
Nation's proposed critical habitat area for these two species. 
Last year, the U.S. Fish and Wildlife issued a final rule that 
would implement an incremental approach to analyzing the 
economic impact of critical habitat designation versus a full 
analysis. This approach would require U.S. Fish and Wildlife to 
only consider the direct cost of government agencies instead of 
considering costs to all stakeholders. This is a short-sighted 
approach.
    A process that allows a full and complete economic impact 
study before critical habitat areas are declared would clearly 
be a better approach. Our farmers and ranchers and landowners 
are often overloaded with unnecessary and burdensome 
regulations. Designating that much critical habitat without 
considering economic effects on the area will no doubt compound 
that problem. Quite frankly, it will affect our lives and our 
livelihoods, and that must be reflected in any evaluation of 
critical habitat designation.
    A recent analysis, economic analysis performed by the 
Association of Arkansas Counties determined that the minimum 
cost of the habitat designation statewide would be at least $20 
million, more than $20 million, and that number we have already 
been talking about is probably doubled or tripled when we 
understand the full impact. That $20 million is five times the 
impact that U.S. Fish and Wildlife has projected for Arkansas 
and all of the other States involved, 11 other States.
    But there is a more important fact. Let me tell you what 
this really means. Every 6 seconds around the globe, a child 
dies of malnutrition-related causes. Now, if we are restricted 
or prohibited or diminished in the productivity of the farmers 
and ranchers in this State, that number will only increase.
    We recognize the Endangered Species Act is necessary for 
the protection of legitimately threatened and endangered 
species. However, its implementation through critical habitat 
designation should not go without considering the true economic 
impacts to the human species, the lives and livelihoods of 
people in Arkansas. It should not be used as a mechanism for 
environmental non-government organizations and law firms to 
essentially extort from private landowners.
    Director Ashe was in Arkansas recently, and we greatly 
appreciate him being there, but he repeatedly said that the 
critical habitat area would not mean any further restrictions. 
In fact, he indicated that regardless of whether you were 
inside or outside of a critical habitat area, that the 
Endangered Species Act would still apply. In other words, any 
activity that might impact endangered species would require 
U.S. Fish and Wildlife permission or permit, regardless of 
whether you were in a critical habitat or not.
    In conclusion, I hope Congress takes control of this issue. 
The men and women of Congress passed the Endangered Species 
Act. In my view, the implementation of the Endangered Species 
Act by the U.S. Fish and Wildlife Service amounts to rewriting 
the law and implementing it in a way that is not consistent 
with the intent of Congress.
    Thank you for the opportunity, and God bless.
    [Applause.]
    [The prepared statement of Mr. Veach follows:]
  Prepared Statement of Randy Veach, President, Arkansas Farm Bureau, 
                         Little Rock, Arkansas
    Mr. Chairman and members of the committee, I want to welcome you to 
Arkansas. Thank you to Rep. Rick Crawford for requesting the field 
hearing.
    My name is Randy Veach, a row-crop farmer from rural Mississippi 
County. I am serving my sixth term as president of Arkansas Farm 
Bureau, the State's largest agriculture advocacy organization, with 
more than 190,000 member families.
    I am eager to speak to you this morning on behalf of farmers, 
ranchers and private land owners who will be adversely affected by the 
Critical Habitat Designations being proposed as part of the Endangered 
Species Act. I speak specifically about the U.S. Fish and Wildlife 
Services' (USFWS) overprotection of two aquatic species, the Neosho 
Mucket and the Rabbitsfoot mussels.
    We want to express our support for Congressman Crawford's bill, 
H.R. 4319, the Common Sense in Species Protection Act of 2014, which 
amends the ESA to require government agencies in charge of determining 
a critical habitat designation--such as USFWS--to perform a true 
analysis of how such a designation will affect an area's lives and 
livelihood.
    This issue involving critical habitat and the Endangered Species 
Act is very important to Arkansas.
    There are more than 700 miles of rivers and streams in our State 
connected to this proposed critical habitat, and 31 counties in 
Arkansas that could be impacted. Roughly 90 percent of these river 
miles pass through private property, a disproportionate impact on 
productive land.
    In this area, Arkansas has more than 21,000 family farms, 7.4 
million acres of farmland, more than $2.9 billion worth of agricultural 
income, which accounts for a half million jobs. Farmers in these areas 
produce more than 78 million broiler chickens, more than 6 million 
laying hens, 606,000 acres of rice, 780,000 acres of soybeans, and 8.6 
million acres of forestland.
    This represents almost half of the Nation's proposed critical 
habitat area for these two species.
    Last year, the USFWS issued a final rule that would implement an 
``incremental approach'' to analyzing the economic impact of critical 
habitat designations versus a ``full analysis.'' This approach would 
require USFWS to only consider the direct cost to government agencies, 
instead of considering costs to all stakeholders. This is a short-
sighted approach.
    A process that allows a full and complete economic impact study 
before critical habitat areas are declared would, clearly, be a better 
approach. Our farmers, ranchers and landowners are often overloaded 
with unnecessary and burdensome regulations. Designating that much 
critical habitat without considering the economic effects on the area 
will, no doubt, compound that problem. Quite frankly, it will affect 
our lives and our livelihood, and that MUST be reflected in any 
evaluation of critical habitat designations.
    A recent economic analysis performed by the Association of Arkansas 
Counties determined the minimum cost of the habitat designation in our 
State would be more than $20 million, five times the total impact USFWS 
projected for Arkansas and 11 other States.
    We recognize that the Endangered Species Act is necessary for the 
protection of legitimately threatened and endangered species; however, 
its implementation through critical habitat designation should not go 
without considering the true economic impacts to the human species, in 
other words our lives and livelihoods. It should not be used as a 
mechanism for environmental Non-Government Organizations and law firms 
to essentially extort from private land owners.
    USFWS Director Dan Ashe was in Arkansas last month to meet with a 
number of stakeholders on this issue, which we appreciated. He said 
repeatedly that being in a critical habitat area would not mean any 
further restrictions. He, in fact, indicated that regardless of whether 
you were inside, or outside, of the critical habitat area that the 
Endangered Species Act still applied. In other words, any activity that 
might impact an endangered species would require USFWS' permission and/
or a permit, regardless of whether you were in the critical habitat 
area or not.
    If this is true, then why have critical habitat designation?
    In conclusion, I hope Congress takes control of this issue. The men 
and women of Congress passed the Endangered Species Act. In my view, 
the implementation of the ESA by the U.S. Fish & Wildlife Services 
amounts to rewriting the law and implementing it in a way that is not 
consistent with the intent of Congress.
    Thank you, and God bless America.

                                 ______
                                 

    The Chairman. Thank you very much.
    And certainly last but not least, we have Mr. Curtis 
Warner, Director of Compliance and Support for the Arkansas 
Electric Cooperative Corporation from Little Rock.

STATEMENT OF CURTIS WARNER, DIRECTOR OF COMPLIANCE AND SUPPORT, 
    ARKANSAS ELECTRIC COOPERATIVE CORPORATION, LITTLE ROCK, 
                            ARKANSAS

    Mr. Warner. Thank you, Chairman Hastings, Representative 
Crawford. Thank you for this opportunity to testify on the 
important issue of the Fish and Wildlife Service's critical 
habitat designations under the Endangered Species Act.
    I would especially like to thank Congressman Crawford for 
requesting that the committee hold a field hearing on this 
timely and important topic right here in Arkansas.
    We also want to recognize Senator Pryor for his work to 
address this important issue in the Senate.
    My name is Curtis Warner, and I am the Director of 
Compliance and Support for Arkansas Electric Cooperative 
Corporation. I have worked for AECC for 35 years. The AECC, 
which is based in Little Rock, is one of the Nation's leading 
generation and transmission cooperatives. We have assets about 
$1.6 billion. AECC provides wholesale electricity to the 
State's 17 electric distribution cooperatives. Together, we 
provide electricity to more than 500,000 homes, farms and 
businesses. Altogether, the electric cooperatives of Arkansas 
have assets of over $4.5 billion. These assets are in the form 
of power plants, substations, transmission lines, and they form 
the infrastructure that is needed to supply reliable and 
affordable electric service to our members.
    When most people think of the Endangered Species Act, they 
think of the western parts of the country. However, this is 
quickly changing. According to the Service's own listing plan, 
every State in the Nation will be affected by at least one 
listing decision within the next 5 years. Here in Arkansas, we 
are already dealing with several species, including the Indiana 
bat and the interior least tern.
    The electric cooperative system covers about 62 percent of 
the land area of the State. We serve members in all 75 
counties. With these and so many additional species expected to 
be listed in the upcoming years, AECC and its members will 
continue to deal with Endangered Species Act issues for many 
years to come.
    Here is an example of an impact we have already had. AECC 
has been a leader in developing clean, renewable energy in 
Arkansas. We own three run-of-river hydroelectric projects in 
the Arkansas River. If shown to be low impact, they can be 
eligible for renewable energy credits, or RECs, which AECC can 
then sell and use to reduce rates to our members. Well, our 
projects are very low impact.
    At our Dam 2 hydroelectric station near Dumas where these 
RECs are currently worth about $350,000 a year, we had trouble 
gaining low impact certification due to the nearby habitat of 
the interior least tern. This caused about a year's delay and 
lost revenue from the sale of those RECs.
    We have been looking at developing additional sites on the 
Arkansas River, but due to ESA concerns like this, it would be 
very difficult to develop any more of these clean, renewable 
resources.
    Another example came when AECC was attempting to site a 
wind project. Working with a major turbine vendor, AECC had an 
opportunity to install the first prototype of a new, state-of-
the-art wind turbine at a very promising location in the 
northern part of the State. Unfortunately, when the vendor 
learned that northern Arkansas was also the territory of the 
endangered Indiana bat, they backed out of the project, citing 
the ESA concerns and the delay to the project that would be 
caused.
    AECC suffered an impact because we had the loss of a clean, 
renewable energy resource. That particular landowner lost a 
considerable amount of money and potential royalties he would 
have gotten from the sale of the energy generated by those wind 
turbines.
    We are pleased that our congressional delegations are 
looking to make more commonsense changes to the Act so that it 
works better for both people and threatened, endangered 
species. Representative Crawford's bill does just that. A key 
feature of the legislation requires a draft economic impact 
analysis be issued concurrently with a proposal to designate 
the critical habitat.
    As the current law is implemented, no real-life economic 
analysis is produced by the Service when a critical habitat is 
proposed. This leads people to believe that establishment of 
critical habitat has essentially zero economic impact. However, 
those that have tried to construct infrastructure projects like 
ours within a designated critical habitat area know there are 
significant economic impacts. Those impacts come from project 
delays, environmental studies, cost of mitigation, land use 
constraints, and simply the difficulty to site a new facility. 
Whatever the form, these impacts raise the costs to our 
projects and, in turn, raise the electric rates to our members.
    Requiring a real economic analysis and having it available 
for public review is a very important benefit of the Crawford 
bill. This will give much-needed transparency to the process, 
and the AECC supports this idea.
    In conclusion, AECC greatly appreciates the work of this 
committee and its efforts to reach out to a new generation of 
stakeholders that would be affected by implementation of this 
Act.
    Finally, I want to thank Representative Crawford and our 
congressional delegation for putting a national spotlight on 
issues we face here in Arkansas as we are implementing the 
Endangered Species Act.
    Thank you for the privilege of providing this testimony, 
and I look forward to answering any questions.
    [The prepared statement of Mr. Warner follows:]
Prepared Statement of Curtis Q. Warner, Director, Compliance & Support, 
               Arkansas Electric Cooperative Corporation
                              introduction
    Chairman Hastings, Ranking Member DeFazio, Representative Crawford, 
members of the Natural Resources Committee, thank you for this 
opportunity to testify on the important issue of the U.S. Fish and 
Wildlife Service's (``Service's'') Critical Habitat Designations under 
the Endangered Species Act (``ESA'' or the ``Act''). My name is Curtis 
Q. Warner, and I am the Director of Compliance & Support for Arkansas 
Electric Cooperative Corporation (``AECC'').
    I would especially like to thank Representative Crawford for 
requesting that the committee hold a field hearing on this timely and 
important topic here in Arkansas. We also want to recognize Senator 
Pryor for his work to address this important issue in the Senate.
    As a result of these strong oversight efforts by Arkansas' 
Congressional Delegation, the U.S. Fish and Wildlife Service recently 
made the decision to reopen for public comment, the proposed critical 
habitat designation for the Neosho mucket and rabbitsfoot mussels. This 
will be the second time the proposal has been reopened for comment at 
the request of our Congressional Delegation.
    AECC would also like to thank the Delegation for providing the 
opportunity to discuss issues in an open forum with Service Director 
Dan Ashe. We were pleased that Director Ashe took time to travel to 
Little Rock on April 17 and listen to our concerns about this important 
rulemaking. With such a widespread critical habitat as is being 
proposed for the two listed mussels, this rulemaking will have a very 
significant impact in Arkansas. For that reason, AECC believes that 
stakeholders be allowed as much time as necessary to provide input on 
the proposal.
                            aecc background
    AECC, based in Little Rock, is one of the leading generation and 
transmission (``G&T'') cooperatives in the Nation with assets of about 
$1.6 billion and annual energy sales of about $736 million in 2013. 
AECC provides wholesale electricity, at some of the most competitive 
rates in the Nation, to the State's 17 electric distribution 
cooperatives. Those cooperatives own AECC and are its members. AECC and 
its 17 members combine to provide electricity to more than 500,000 
farms, homes, and businesses in Arkansas. All together, the Electric 
Cooperatives of Arkansas have assets of over $4.5 billion dollars 
invested here in Arkansas. These assets, in the form of power plants, 
substations, and transmission and distribution lines, form the 
infrastructure needed to supply electric service to our member-
consumers.
    AECC generates and transmits electricity statewide and delivers it 
to the distribution cooperatives. From there, the distribution 
cooperatives own and operate a system of distribution lines to provide 
electric service to their members. Both G&T and distribution 
cooperatives were formed to provide reliable electric service to their 
member-consumers at the lowest possible cost.
    I have had the good fortune of serving AECC members for more than 
35 years. Since I began work at AECC in 1979, I have participated in 
performing environmental reviews and permitting for all of AECC's power 
plants, electric l substations, and transmission lines. This includes 
preparation of five Environmental Impact Statements, numerous 
environmental and engineering reports, and testimony for 16 hearings 
involving new utility projects before the Arkansas Public Service 
Commission. Once a review is complete, my staff and I take part in 
acquiring and maintaining the regulatory permits necessary to construct 
and operate these facilities. Those permits are subject to many layers 
of Federal, State, and local regulations and requirements. Often those 
regulations overlap, and occasionally they conflict with each other. 
And sometimes, as in the case of the Endangered Species Act, those 
regulations can even conflict with themselves.
                       aecc's experience with esa
    When most people think of the Endangered Species Act, they think of 
the western parts of the country. We've all heard about the spotted owl 
and the desert tortoise. However, given the 2011 settlement agreement 
between the Service and environmental plaintiffs, this is quickly 
changing. According to the Service's listing work plan, every State in 
the Nation will be affected by at least one ESA listing decision in the 
next 5 years. Here in Arkansas, we're already dealing with several 
species including the Indiana bat, Arkansas fatmucket, pink mucket, 
interior least tern and red-cockaded woodpecker.
    The electric cooperative system covers about 62 percent of the land 
area of Arkansas. We serve members in all 75 Arkansas counties. With 
these and so many additional species expected to be listed in the next 
few years, AECC and its member cooperatives will continue to deal with 
ESA issues for years to come.
    An example of a recent ESA impact is from siting a transmission 
line in Saline County. AECC submitted its proposed line route to the 
Service for review, and the Service requested a buffer zone around a 
small unnamed tributary to the Saline River so that listed mussels that 
might be present in that stretch of the river would not be impacted. 
The small intermittent tributary itself wasn't designated critical 
habitat--the proposed critical habitat was almost a mile away. (Note 
that this is an overhead line. The only soil disturbance would be the 
initial clearing of vegetation for line reliability and the area in the 
immediate vicinity of pole placement.)
    In order to comply with the Service's initial recommendation, the 
route of the transmission line would have been moved to the middle of a 
farmer's field. This would have caused delay for AECC and would have 
created a physical and economic impact to the farmer for many years 
having to avoid poles when working the area. Fortunately, AECC was able 
to work with the Service's local office and move the line to a more 
practical location.
    AECC has been a leader in developing clean, renewable energy in 
Arkansas. AECC owns three run-of-river hydroelectric projects on the 
Arkansas River. If shown to be low-impact, which they are, they can be 
eligible for renewable energy credits (``RECs'') which AECC can sell 
and use to reduce rates to our members. At our Dam 2 hydroelectric 
station, where these RECs are currently worth about $350,000 a year, 
AECC had trouble gaining low-impact hydroelectric facility 
certification due to the habitat of the interior least tern in the 
area. This caused about a year's delay and lost revenue from the sale 
of RECs. We have also been looking at developing additional sites on 
the Arkansas River to harness more renewable energy; but, due to ESA 
concerns like this one, it would be very difficult to develop any new 
projects under the current regulatory environment.
    Another specific example came when AECC was attempting to site 
another type of renewable energy project--this time a wind project. A 
few years ago, AECC had performed a 2-year wind study to determine the 
best places to site utility-scale wind turbines in Arkansas. Working 
with a major turbine vendor, AECC had an opportunity to install the 
first prototype of a new state-of-the-art wind turbine at a very 
promising location as part of a demonstration project. Unfortunately, 
when the vendor learned that northern Arkansas was a territory of the 
endangered Indiana bat, they backed out of the project citing ESA 
concerns and the delay to the project which would occur.
    Often times trying to protect one species could harm another, 
effectively tying our hands as we try to develop a project. For 
example, look at the measures to protect mussels verses the measures to 
protect birds and bats. In the case of the two mussel species that 
prompted this hearing, agencies such as the Corps of Engineers 
recommend that to minimize siltation in runoff to wetlands and streams, 
which could do harm to the mussels' habitat, we should restrict land 
clearing to the drier months as much as possible--in Arkansas that 
would be in the summer. Farmers and landowners prefer that we build 
power lines during drier periods; this reduces rutting and damage to 
farm fields and property. However, other agencies such as the Service 
have recommended that we delay the clearing of trees until the winter 
months in order to protect roosting birds and bats. Clearing trees in 
winter is the worst time to clear due to the soggy ground and rainy 
weather--both of which would tend to increase siltation of area streams 
potentially harming the mussels to protect birds and bats.
    And after October of this year, this will become an even bigger 
constraint as another species--the northern long-eared bat--is listed. 
At that point any clearing of trees will have to be coordinated through 
the Service. In many cases field surveys will have to be conducted, at 
no trivial expense, to determine if any of the species are present in 
the area. This will cause delays and extra costs to almost every new 
power line construction project, no matter how small. It will also be a 
significant impact to private landowners and the timber industry.
the importance of transparency and consistency in esa listing decisions
    AECC's mission is to provide reliable and affordable power to our 
members in a responsible manner.
    As part of the Nation's electric grid infrastructure, many of 
AECC's projects cost in the millions of dollars. In the case of new 
generating stations, it can be in the hundreds of millions of dollars. 
As an electric cooperative, all of these costs are passed directly on 
to our members. So, in order to meet our requirements of reliability 
and affordability, it's very important that our projects are within 
budget and on time.
    As you know, every action and new regulation by the Federal and 
State government can make permitting and compliance even more 
difficult, costly and time-consuming than it already is. This extends 
to something seemingly as benign as a ``threatened or endangered 
listing'' of a relatively unfamiliar plant or animal species by the 
Service, which is the subject of this hearing today. The consequences 
of listing a species can be very far reaching, so the process needs to 
be done with care, and in an open and transparent manner.
    We are pleased that our Congressional Delegation is looking to make 
common sense changes to the ESA so that it works better for both people 
and threatened species. Representative Crawford's Common Sense in 
Species Protection Act of 2014 (H.R. 4319) does just that. But in so 
doing, the bill avoids any changes to the ESA listing process itself.
    A key feature of this legislation requires that a draft economic 
impact analysis be issued concurrently with a proposal to designate 
critical habitat under the ESA. It will also ensure that the 
methodology used in designating critical habitat under the ESA properly 
reflects the true economic impact to people and businesses, including 
electric cooperatives and our members.
    This economic analysis needs to include the real costs of a 
critical habitat designation, not just the costs that government 
agencies incur to administer an ever increasing bureaucracy. Requiring 
a real economic analysis and having it available for public review is a 
very important benefit of the Crawford bill that will give transparency 
to the process, and AECC supports this idea.
    Capturing the real costs of a critical habitat designation is 
paramount to this reform effort. However, in order to capture the real 
costs, you have to get the methodology correct. AECC's national 
association, the National Rural Electric Cooperative Association 
participates in a broad-based coalition supporting reasonable 
improvements to the ESA, such as this bill. The National Endangered 
Species Act Reform Coalition has noted that this bill makes several key 
improvements by:

     clarifying the scope of the economic analysis by requiring 
            the Secretary to examine both the ``incremental and 
            cumulative'' effects of ``all actions to protect the 
            species and its habitat,''
     expanding the scope of the area to be analyzed to include 
            each State and locality that is ``the subject of, or 
            affected by, the proposed designation,''
     requiring the assessment of economic effects on a 
            ``quantitative and qualitative basis,''
     requiring the economic impact analysis to specifically 
            address public and private economic effects on possible 
            uses of land and property values, provision of water, power 
            and other public services, employment, and revenues 
            available for State and local governments, and finally
     mandating that the economic impact analysis comply with 
            the guidelines issued pursuant to the Data Quality Act.

    AECC strongly supports these provisions.

    These modifications to current law are important because, as the 
ESA is currently implemented, no real-life economic analysis is 
produced by the Service when critical habitat is proposed. This leads 
people to believe that establishment of critical habitat has 
essentially zero economic impact. However, those that have tried to 
construct infrastructure within designated critical habitat know that 
there are significant economic impacts.
    These impacts come in different forms: project delays, additional 
environmental studies, cost of mitigation, land use constraints, and 
difficulty in siting new facilities. Whatever the form, these impacts 
raise the costs of projects--which in turn raise electric rates to our 
co-op members. And finally, it's important for an entity like AECC that 
needs to schedule and budget for such projects to have transparency 
from the beginning so we have a clear understanding of what those 
impacts may be.
    But these impacts aren't just felt by businesses such as AECC; they 
also affect individual landowners. Take my earlier example where a new 
transmission line almost got moved into the middle of a field. Being in 
or even near a designated critical habitat is a burden that can cause 
land use constraints on property owners and decreases their property 
values. We know this because in Arkansas many of these property owners 
are the rural property owners that we serve in our cooperative service 
territories.
    To address this issue, Representative Crawford's bill, H.R. 4319, 
will mandate the exclusion of property from a critical habitat 
designation where the economic impacts analysis shows that the benefits 
of the parcel's exclusion outweigh the benefits of including the parcel 
within the critical habitat designation. This is obviously common 
sense; but, it is also a protection rural property owners need, and 
AECC strongly supports this idea.
    I would note that the U.S. Fish and Wildlife Service has announced 
a draft policy prioritizing the types of properties that may be 
excluded from a critical habitat. As this draft policy was just 
announced on Friday, May 9, we are still reviewing this proposal. 
However, from initial review, while well-intentioned, the draft policy 
is inadequate and only reinforces the need for certainty that would be 
provided by H.R. 4319.
                               conclusion
    AECC greatly appreciates the work of this committee in its efforts 
to reach out beyond the interior West to the new generation of ESA 
stakeholders that will be affected by implementation of the Act. We 
look forward to partnering with you as you continue your work to make 
common-sense changes to the ESA.
    Finally, I want to thank Rep. Crawford and our Arkansas 
Congressional delegation for putting a national spotlight on the issues 
we face as the ESA is implemented at home here in Arkansas. Legislation 
such as that proposed by Rep. Crawford and Senator Pryor seek to make 
modest but significant changes to the ESA that can provide the 
transparency we need while protecting the species that inhabit the 
Natural State.
    Thank you for the privilege of providing this testimony. I look 
forward to receiving your questions at the appropriate time.

                                 ______
                                 

    The Chairman. Thank you very much, Mr. Warner, for your 
testimony.
    We will now go into the part where we as Members get to ask 
questions and follow up on some of the comments. So I will 
start first by recognizing our host, Mr. Crawford.
    Mr. Crawford. Thank you, Mr. Chairman.
    Section 3 of the Endangered Species Act explicitly requires 
that critical habitat not include an entire geographical area 
for species but rather should only include specific areas 
within a geographical area occupied by the species that are 
essential to the conservation of the species.
    For just Arkansas, the Fish and Wildlife Service's proposed 
critical habitat designations for the Rabbitsfoot Mussel and 
the Neosho Mucket would impact 30 counties, most of which is 
privately owned property.
    First, Mr. Creasy, in your opinion, are the critical 
habitat designations specific and essential? And to your 
knowledge, did the Fish and Wildlife Service consult with you 
about specific areas of your land that would be included in the 
proposal before it was issued?
    Mr. Creasy. Obviously, again, as stated earlier, they have 
a job to do. Basically put, no, we received no notification, we 
received no consultation. Going forward, obviously that is what 
we request and that is what we are looking for you guys as 
legislators to try to change up some of the regulation that 
occurs.
    Cattle producers obviously are going to be affected by more 
than just the stream that this mussel lives in. We have 
property that borders those, and our concern, of course, is if 
you have cattle drinking from those streams, how does that 
actually affect, and what regulations are going to come into 
play? Again, they are talking about only governmental 
interaction. But should something occur on the ground, how does 
that actually affect the economy if we have to take land out of 
production because of a mussel in a stream that lies next to 
those?
    But at the end of the day, no, we have not received 
consultation from cattle producers. We are concerned that that 
gets missed somehow in the big picture of things.
    Mr. Crawford. OK, thank you.
    Mr. Veach, would you like to weigh in on that?
    Mr. Veach. Well, I think that there are all kinds of 
effects that are hard to even weigh out and to put a finger on. 
I think that any time you restrict the activity--and, as Mr. 
Pharr said in his comments, there are already burdensome 
regulations going on in these areas. They are complying, all 
the producers are complying to these regulations. And when you 
continue to add more onto that, you end up taking the 
profitability out of the farmers' and ranchers' pockets. Once 
you do that, when you take the profitability away, then we are 
not sustainable. The farmers and ranchers are not sustainable 
when they are not profitable. That is a basic definition of 
sustainability is to be profitable. When we are not, we are not 
sustainable. When we are not sustainable, neither is the 
abundant, affordable, safe supply of food that we have all 
become so used to.
    Mr. Crawford. Thank you.
    Mr. Day, you have a kind of a unique situation. We have 
heard from farmers, but what are your thoughts regarding that 
same question?
    Mr. Day. Well, we have the same concerns. I mean, we are 
just very worried that we won't be able to do what we have been 
able to do over the last--since 1949 in our location. So, yes, 
we are exactly in the same boat, and I would echo what these 
guys have said, for certain.
    Mr. Crawford. OK. It is my understanding that Congress, 
originally concerned with how Federal agencies were 
interpreting critical habitat in the original Endangered 
Species Act, amended it in 1978 to limit its designation to 
specific rather than broad areas.
    Mr. Pharr, do you believe that Fish and Wildlife Service is 
designating critical habitat in a limited manner intended by 
Congress?
    Mr. Pharr. It does not appear to me that it is in a limited 
manner. It appears to be very widely spread, much more so than 
is needed.
    Mr. Crawford. Obviously, we are here talking about the most 
pressing issue for us right now, the Rabbitsfoot Mussel and the 
Neosho Mucket. But, Mr. Fox, you had some interesting testimony 
regarding a bat.
    But the same question to you. Do you believe the Fish and 
Wildlife Service is designating critical habitat in a limited 
manner intended by Congress?
    Mr. Fox. Well, I would have to answer no. I think it is a 
general manner rather than a limited manner. But I would say on 
the mussels issue, as far as forested land, current forest 
practice and management and logging practices would protect 
both the mucket and the mussel, leaving trees. Trees clean the 
water in several ways. Our forests clean the air. So healthy 
forests, good forest management, which includes logging and 
prescribed fire, would actually be good for clean water and in 
this case I think would also be good for the bat as well.
    So I think it is more about our practices in the forest 
than the extent of the habitat. I think the habitat--I think we 
could coexist I guess is what I am trying to say.
    Mr. Crawford. Thank you.
    I yield back.
    The Chairman. Thank you all for testifying. It has been 
alluded to several times that the Northwest or the West has 
been hit. I think, Mr. Veach, you alluded to that, and 
certainly Mr. Pharr with the statements that you mentioned. I 
will just say on a personal note I have been living kind of 
through that in the time that I have been in Congress.
    Let me ask, then, in that vein a question to six of you, or 
five of you. Mr. Creasy, Mr. Day, Mr. Fox, Mr. Pharr, and Mr. 
Veach, I want to ask you this question.
    In a January 10, 2014 news bulletin that was issued by the 
Arkansas Office for Fish and Wildlife Service they state, and I 
will quote--and it is a long quote, but I think you will get 
the sense of it--``For most landowners, the designation of 
critical habitat will have no impact. For example, it will not 
prohibit a farmer from allowing cattle to cool down in a river 
or from driving a vehicle through a stream on their property. 
Critical habitat is primarily a tool to alert Federal agencies 
that they are required to make a special effort at conservation 
when they work in an area designated as critical habitat or 
fund others to work there or permit work by others.''
    Now, you heard the testimony today from the Fish and 
Wildlife, testimony that the average person will not incur any 
costs associated with that. Do you agree that that would be the 
case?
    And we will start, Mr. Creasy, with you.
    Mr. Creasy. I don't agree with that. I think that if a 
landowner, a cattle producer is not under an NRCS contract or 
within government scope of anything--we are the ultimate 
conservationists. At the end of the day, we depend upon the 
land, we depend upon the water to be able to produce cattle for 
a growing world. So at the end of the day, if we are not 
engaging the Federal Government with anything, we simply want 
to be left alone.
    But if you have a cattle producer who has cattle going out 
to drink from a stream and they disturb some of the constituent 
elements of either the mussel, the fish, or whatever that 
endangered species may be, the question I sometimes have asked 
back to Fish and Wildlife is what is the economic impact if 
that ranger down the river sees that cow go in and disturb 
water, and now all of a sudden he has disturbed the constituent 
elements of a species, and all of a sudden an animal has took--
--
    The Chairman. OK. I want to get others to answer that 
question.
    Mr. Creasy. OK.
    The Chairman. But the point is--and I don't want to put 
words in your mouth, but you are not necessarily comforted by 
the fact that that statement is out there.
    Mr. Creasy. No, sir, not at all. Not at all, sir.
    The Chairman. OK. All right.
    Mr. Day?
    Mr. Day. Yes. We are not comforted by that statement either 
based on what we have observed and seen. The examples that have 
been shown to us through the situations that have happened out 
West, that would certainly cause us great concern as well, just 
the evolution of the process. Our specific part of it is a 
little more unique because we are not just crossing through the 
stream. We are using the stream. We are canoeing, we are 
fishing. It is a part of what we do.
    So we don't know how we fit into a statement like that, and 
that is a big concern for us.
    The Chairman. Mr. Fox?
    Mr. Fox. Sure. There is definitely a cost to forest 
landowners to leave trees in the riparian zone beside the creek 
or the stream. There is definitely a cost. But I would add that 
for the last 20 years Arkansas has had our best management 
practices for forestry, which are pretty much water driven for 
protection of the streams, and 89 percent of our forest 
landowners, by our monitoring effort at the Forestry 
Commission, conform to the voluntary best management practices.
    I much prefer a voluntary system as we have in our forestry 
community, but there is a voluntary cost that our forest 
landowners practice, and it is usually in the leaving of those 
trees beside the stream.
    The Chairman. I want to finish up with Mr. Pharr.
    Mr. Pharr. Mr. Chairman, I don't agree with the statement 
either. I think all you would have to do is look at the 
forester, the people in the Pacific Northwest that were 
affected by the Spotted Owl. I think that would pretty much 
answer what could happen to us.
    The Chairman. And Mr. Veach?
    Mr. Veach. Yes, I disagree with the statement as well. I 
think the U.S. Fish and Wildlife are the only ones that 
actually do believe that statement. I think that if that is the 
statement, why not do an economic impact to see exactly what 
the impact will be? Why shut that door? Why don't we do a 
complete economic impact and let's make sure if they are right 
or not? But we don't believe that they are.
    I think one of the things that is not taken into 
consideration there is civil lawsuits. Once these habitats are 
designated, then we have to face civil lawsuits for individuals 
that can get all those charges paid for by the U.S. Government. 
But those lawsuits could amount to a lot and actually shut 
farms down.
    The Chairman. I will have a follow-up to that. My time has 
expired.
    I recognize Mr. Crawford.
    Mr. Crawford. Thank you once again, Mr. Chairman.
    Last summer the Obama administration finalized a rule, 
ignoring opposing comments, a 10th Circuit Court of Appeals 
opinion, letters from Members of Congress on how it must 
conduct economic analyses for critical habitat designations. 
The rule requires Federal agencies administering ESA to only 
analyze costs of the actual habitat designation but ignore all 
other costs associated with listing a species.
    Mr. Warner, in your view, is the executive order the best 
way to implement ESA? And why is it important to accurately 
document the costs of ESA and what the impacts of the rule on 
rural areas would be?
    Mr. Warner. Well, in general, my personal opinion is that 
ruling the country by executive order is not the way to do 
things on something as diverse as the Endangered Species Act.
    [Applause.]
    Mr. Warner. I think decisions like that should be dealt 
with by Congress, where there is a lot of input from across the 
country on decisions like this.
    As far as the economic analysis, certainly if you don't 
know the true cost of what you are doing, you are going to be 
making some pretty stupid mistakes.
    Mr. Crawford. Thank you.
    Mr. McDaniel, in your written testimony you point out that 
Fish and Wildlife Service chose to expand critical habitat to 
include an entire river reach where populations of these 
mussels are not now present. Can you elaborate why this is 
problematic?
    Mr. McDaniel. Well, it goes against the definition and the 
designation of what critical habitat is supposed to be. The 
Rabbitsfoot Mussel has been described to me by my mussels 
experts as a habitat specialist. What that means is they select 
very specific habitats to choose to live in. As you have shown 
on that map, for the 180 miles of the Saline River, there are 
large stretches in that proposed critical habitat that are not 
conducive and would never harbor Rabbitsfoot Mussel because the 
habitat is not what they like.
    So by expanding from the uppermost to the lowermost point 
of where they have historical record is a complete misuse of 
the occupied habitat that is required for the critical 
designation.
    Mr. Crawford. Thank you.
    Serial litigants often say the litigation saves species 
from extinction. They point to the mega-settlements and mega-
petitions that could add over 757 species to the list in the 
next few years, an increase of over 50 percent of the current 
listings that have taken 40 years.
    Mr. Veach, do you agree with that?
    Mr. Veach. I don't know. I know that there are, I think, 47 
or so more species that are being submitted for endangered 
species in Arkansas alone. As you go around the States, other 
States, it is that many and more. I think that this thing is 
actually exploding on us, and I think the more that it grows, 
then the bigger problem that it becomes. I think, just like Mr. 
McDaniel was saying a while ago, some of these areas are not 
even the habitat that they would like to be in anyway.
    So I think that we just keep expanding this, and it has 
kind of taken on a life of its own and growing, and if we don't 
get a handle on it, if Congress doesn't get a handle on it, 
then it is going to put all of us out of business.
    Mr. Crawford. Thank you.
    Mr. Warner, do you want to weigh in on that one?
    Mr. Warner. Well, I really don't have anything else to add. 
I think that that says it.
    Mr. Crawford. Thank you.
    I yield back.
    The Chairman. Let me follow up on my last line of 
questioning.
    Ms. Dohner, I want to ask you on this because you heard 
what your fellow panelists said about the statement that was 
issued by the Arkansas Fish and Wildlife Department. To be 
kind, there is suspicion that it won't work. Like I say, that 
is being kind, and I have lived through that in the Northwest.
    Now, as I understand it, a couple of years ago, and I don't 
know if you were involved with this, but the Fish and Wildlife 
teamed with the Florida Fish and Wildlife Conservation 
Commission in an attempt to streamline the permitting processes 
within the States to give the States more authority on ESA 
consultation.
    Now, this follows in line, in a way, with what Mr. Fox 
said. Mr. Fox suggested that voluntary compliance--or to put it 
a different way, those that are affected should be part of the 
decisionmaking process, and it appears to me this is what the 
attempt was by Fish and Wildlife, trying to team with Florida.
    However, last year the Center for Biological Diversity and 
the Conservancy of South Florida, two environmental groups, 
threatened a lawsuit against Fish and Wildlife to prevent this 
from happening.
    Now, it just seems to me that when there is an effort for 
you to do the right thing, somebody sues, and that has been 
brought up several times. As a matter of fact, the subject of 
legislation that we passed out of my committee within the last 
month was more local control.
    But wouldn't you say, as somebody who is tasked with 
administering this law, that the effort with Florida was a good 
effort, but that these continuous lawsuits slow down the 
desired idea of saving species?
    Ms. Dohner. Yes, sir, I would say that is a good effort, 
and I was involved with that. That was an agreement between 
Fish and Wildlife and the Florida Conservation Commission. We 
are currently still working on those agreements. We have to 
develop step-down plans. We are currently working through that.
    The Chairman. What is the basis of the lawsuit that denies 
you from doing that? Is there something in the law that says 
you can't consult, you can't enter into agreements?
    Ms. Dohner. Sir, what we did is we developed an agreement 
under the----
    The Chairman. No. What is the basis of the lawsuit? What is 
the reason why you had to stop this process?
    Ms. Dohner. The agreement we have with the Fish and 
Wildlife Conservation Commission allowed them to manage more of 
the species and allowed them to work with private landowners as 
needed to issue permits and things like that, as long as it 
follows a plan that we both work on for an individual species 
or a suite of species.
    The Chairman. Right. I just want to make sure I understand. 
So what you were doing, then, your effort was to consult with 
local people that are affected on the ground to try to effect 
an outcome that would be good for all parties involved with 
local input. Is that correct?
    Ms. Dohner. Right, and it would give the State more 
authority over the management of the species, sir.
    The Chairman. OK. Now, the Center for Biological Diversity, 
which is one of those that brought this mega-suit in the first 
place, didn't like that why?
    Ms. Dohner. They didn't like that because they said they 
didn't believe we had the authority to work with the State in 
this manner through the Section 6 agreement. But like I stated 
earlier, we are continuing on that effort in developing these 
step-down plans, either for individual species or a suite of 
species, to allow them to go forward to manage the species.
    The Chairman. Well, I thank you for your answer, and that 
is very enlightening, and it is the reason why we had 
legislation that passed out of our committee, to deal with more 
local consultation. The frustration that I have heard at home 
for a number of years is they will ask and then ignore whatever 
solutions. In fact, there are efforts--in front of our 
committee we had testimony that there are more people on the 
State level actively involved in managing wildlife and saving 
species on the State level than these national environmental 
groups are doing any place, any place in the country.
    Now, we have found in our committee that ESA, frankly, has 
become a litigious dream, and I will say that very bluntly.
    Well, I thank you for your statement, and I encourage you 
to continue to try to do that. I will tell you, you have 
support from our committee precisely on getting more local 
people involved in the whole process, including listing and 
including managing.
    So, with that, I will yield again to Mr. Crawford.
    Mr. Crawford. All right. Thank you, Mr. Chairman.
    Recently, the Committee on Natural Resources passed 
legislation requiring the Fish and Wildlife Service to post its 
scientific data that formed the basis for its listing decisions 
online so that independent commenters and American citizens can 
review them in advance.
    Mr. Creasy, would you support that concept?
    Mr. Creasy. Yes, sir, I would. The more transparency, the 
better.
    Mr. Crawford. Mr. Day?
    Mr. Day. Yes, absolutely, of course.
    Mr. Crawford. Mr. Pharr?
    Mr. Pharr. Yes, sir, I would.
    Mr. Crawford. Mr. Veach?
    Mr. Veach. Yes, yes.
    Mr. Crawford. Ms. Dohner, would you support that?
    Ms. Dohner. Sir, I believe we need to be as transparent as 
possible and provide the information when we can. Yes, sir.
    Mr. Crawford. OK. That is good news. I appreciate that.
    Mr. Pharr, in your written testimony you alluded to 
examples in California where citizen groups have sued farmers 
for using their own land that also had been part of a critical 
habitat designation. Do you fear the same thing might happen 
here in Arkansas?
    Mr. Pharr. Yes, sir, I think it certainly could.
    Mr. Crawford. Can you see any specific areas of concern for 
you and your operation?
    Mr. Pharr. Not particularly in my operation since I don't 
have any rivers or creeks through my operation. But certainly 
my family owns farms where a creek goes through the farm, and I 
could see having to do things along the creek to prevent cattle 
getting in it or whatever.
    Mr. Crawford. Mr. Creasy?
    Mr. Creasy. We have some operations within the watershed 
proposed up here that would fall within creeks and boundaries. 
So I could see things going forward.
    Mr. Crawford. Mr. Veach?
    Mr. Veach. Yes, I think so. I think that one of the 
examples that Mr. Pharr brought up is some of those 
consequences that you don't think about all the time in these 
designations, that the herbicide Enlist has not been cleared 
for Arkansas because of those critical habitat designations. 
That is one of the tools we will certainly need going forward 
with the agriculture production.
    Mr. Crawford. Thank you.
    Ms. Dohner, I have had some experience working on some 
projects that obviously were subject to public comment. I am 
just curious, how heavily weighted are these public comments 
toward other Federal agencies as opposed to citizens who want 
to weigh in and be heard? Because it has been my observation 
that some of these public comments really have no interest in 
hearing from citizens but rather other Federal agencies that 
support their position. Is that common?
    Ms. Dohner. Sir, I wouldn't agree with that, no. I believe 
that during the comment period we received quite a bit of 
information, including detailed comments from the Arkansas 
Association of Counties, and we are looking at those, and 
because of that we are responding in a letter that says that we 
will make changes to this critical habitat designation that 
will result in a reduction in the amount of area proposed.
    So I believe that we have to consider all comments that we 
receive to make sure that we have the best science in the 
commercial data, including the information from private 
landowners to other Federal agencies.
    Mr. Crawford. Excellent. Thank you.
    Yield back.
    The Chairman. This will be the final question. Then I will 
turn it over to Mr. Crawford to kind of wrap it up.
    I just have three questions here, first for Mr. Day.
    A number of panelists testified about the economic impact 
that has been a common theme, which I totally agree with. Could 
you be very specific with where your camp is and what the 
economic impact is in that local area specifically, if you have 
knowledge? Can you talk about that?
    Mr. Day. Yes, certainly. We are in Montgomery County, 
Arkansas, which most of the land in Montgomery County is U.S. 
Forest Service land. So we have very limited opportunities for 
business in Montgomery County. We are the number two employer 
in the county. Our direct economic impact is about $5 million 
just as far as what we spend on employees and hiring staff that 
spend money in a two-county area. I have worked with Mr. 
Hamilton, actually, and have done some multipliers and some 
modifications to that, and the actual multiplied economic 
impact approaches $10 million. So it is very significant to a 
rural economy that doesn't have any real opportunities for 
other businesses to come into this area. So it is a big deal.
    The Chairman. Not to be redundant, but you feel that these 
listings would adversely affect that economic activity?
    Mr. Day. Oh, absolutely. We are very, very concerned about 
it. We have operated along the banks of the Upper Ouachita 
since 1949, and it has been an integral part of what we do. 
Looking at the things that have happened, yes, we are very 
concerned about how that would affect us, our ability to have 
continued impact not only on the economy but just on the kids 
that we impact from 35 States and multiple foreign countries. 
So, yes, very concerned.
    The Chairman. Mr. Warner, you mentioned briefly in your 
oral statement about the renewable energy and the impact there. 
Could you elaborate a bit? Because of the non-permitting, the 
potential indirect costs that may accrue to your ratepayers 
because of that activity?
    Mr. Warner. Well, we have invested in renewable energy over 
the years primarily because it was economical for us to do so. 
These Arkansas River hydro projects were very beneficial, good 
for our State, and a good source of clean, renewable energy.
    The fact that we may lose--basically a lost opportunity to 
take advantage of that in the future is what concerns me. If we 
are trying to develop additional sites on the Arkansas River or 
wind turbines up in the northern part of the State but we can't 
because of the proximity to critical habitat or it is just too 
difficult to site a facility, the State, our members, the 
environment loses because we can't develop those renewable 
energy resources.
    In the case of the Arkansas River, the river is going 
downstream. It is considered a low-impact hydro facility on the 
river. But I don't know that we could permit and build those 
facilities today with the current regulatory environment. I 
know that in the northern part of the State, with the northern 
long-eared bat and Indiana bat and the other species that are 
in that area, wind developers, if you look across the State, 
all the wind farms that have ever been built, there aren't any 
in Arkansas. Part of the reason is the Endangered Species Act 
issues in the northern part of the State. Our wind is not as 
good as most places, but we do have that concern compounding 
our problem.
    The Chairman. Finally, Mr. Fox, I have a question for you. 
The Center for Biological Diversity--there is that organization 
again; it keeps coming up--in its petition to the Fish and 
Wildlife Service, said that in listing the mussels, they fault 
the loggers for, and I will quote, ``failing to follow best 
management practices.''
    Now, my understanding of best management practices for 
forests is multiple use, obviously harvesting, obviously 
thinning, obviously prescribed burning, whatever the case may 
be. Did they ever say--or are you familiar with that, that that 
is part of what their petition said, that you were at fault?
    Mr. Fox. I was not familiar with that, no.
    The Chairman. OK. Well, what would your response be to 
that?
    Mr. Fox. Well, I would strongly, strongly disagree with 
that. Farmers and foresters are the original conservationists. 
If we can't come back, in our case, in the woods every 5 to 7 
years, sometimes it is once every 30 years, and harvest again, 
then we are out of business. It would be the most ignorant 
thing we could do to ruin our environment.
    Having said that, the forestry community, much because of 
the Northwestern problem with the Spotted Owl, girded ourselves 
several years ago so that we did have best management 
practices. We monitor those practices for their efficiency, to 
see if they are doing what they are supposed to do, their 
effectiveness. We monitor behind a certain amount of loggers 
every year on a random sample to see if they are being followed 
on public land and private land, and our current monitoring 
shows 89 percent compliance with voluntary best management 
practices.
    I strongly disagree with that statement, and I think we are 
the conservationists that can protect the mussels, the quality 
of the streams, and the quality of our air.
    The Chairman. Well, thank you, and thank all the panelists.
    Let me turn it over to my colleague, Mr. Crawford, again, 
our host, for his closing statement, and then I will wrap it 
up.
    Mr. Crawford. Thank you, Mr. Chairman.
    Again, I want to thank the Chairman for coming and for the 
committee.
    I think what we have seen here today is a demonstration of 
a marked contrast between environmental activism versus active 
environmentalism. And farmers, as we have heard here today, and 
ranchers and foresters, are active environmentalists. They 
derive their livelihood from the land, and I believe they can 
be trusted because of that to be good stewards of that land 
without an overreach of the Federal Government.
    I want to thank them for the testimony.
    Thank you for being here.
    I also want to thank the University of Arkansas Community 
College at Batesville, Chancellor Deborah Frazier; Heath 
Wooldridge, Director of the Physical Plant; Mark Cartwright, 
the Events Coordinator; and for all the assistance from our 
maintenance team, Joshua Bishop, Bill Jackson, Christian 
Bernard, and Lori Bell; and Independence County Sheriff's 
Department. Sheriff Steve Jeffery, if you are here, we 
appreciate you. And finally, State Representative James McLean. 
I saw him earlier. I don't know if he has left or not, but I 
appreciate him being here.
    And with that, thank you all very much.
    And once again, thank you, Chairman Doc Hastings.
    The Chairman. Thank you very much.
    [Applause.]
    The Chairman. Let me just wrap up a couple of thoughts 
here. First of all, many times questions arise after the panel 
has been dismissed, and you may get a letter from one of us 
asking a follow-up, and if that happens I wish you would be 
able to respond as timely as you can.
    I want to make the tie-in with what several members of the 
witnesses said and what I said earlier, that those of us in the 
Northwest have been more greatly affected by ESA in the long 
term. I would just tell you right now, with this multiple 
listing and with the potential listings and critical habitat 
designations here in the Southeast, this issue is not going to 
go away. In fact, I believe it is going to get worse for you, 
and I would encourage all of you--your presence here today I 
think is certainly aware of that.
    But I will tell you just from our experience, it is going 
to get worse. I will cite one case in point because we had a 
member here from the forest industry. Forestry used to be a big 
industry in the Northwest. But since the listing of the Spotted 
Owl, which supposedly its demise was because of the lack of old 
growth, although now science says it is because of a predator 
and not the lack of old growth--at any rate, the economic 
activity on Federal forest lands is that harvesting has gone 
down by 90 percent--that is 9-0--in 20 years. Equate that to 
the jobs and the mills that are no longer there. So that is an 
effect of having a listing.
    Mr. Veach, you said Congress should take control. That is 
precisely what the committee I have the privilege to chair is 
trying to do with the four bills that we have passed out right 
now that we think will highlight some of what the Endangered 
Species Act badly needs, and that is more transparency, more 
local control, and we have to get a handle on the litigation. 
Those are three themes that are wrapped up in those pieces of 
legislation.
    So, once again, I want to thank you. On a personal note, 
this is the first time that I have had the privilege to visit 
Arkansas. I am from the dry part of Washington State, but 
because of the rain I am sure people will associate this with 
Seattle. But at any rate, in fact, my part of the State is so 
dry that when it rains, we call it inventory.
    [Laughter.]
    The Chairman. So, at any rate, again, I thank the witnesses 
very, very much for your testimony.
    Rick, thank you very much for being honest to have this 
hearing here. I think it was a very, very valuable hearing.
    But I would just again simply say for all of you here that 
took time to come, this issue is not going to go away, and you 
should engage yourself in this issue as much as you can.
    If there is no further business before the committee, the 
committee stands adjourned.
    [Applause.]
    [Whereupon, at 11:44 a.m., the committee was adjourned.]

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