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

                        THE FISCAL YEAR 2015 EPA BUDGET

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

                                 JOINT HEARING

                                   BEFORE THE

                        SUBCOMMITTEE ON ENERGY AND POWER

                                    AND THE

                  SUBCOMMITTEE ON ENVIRONMENT AND THE ECONOMY

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED THIRTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                 APRIL 2, 2014

                                   __________

                               Serial No. 113-133

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

                                    ____________

                                    U.S. GOVERNMENT PUBLISHING OFFICE
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                        COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman

    RALPH M. HALL, Texas                 HENRY A. WAXMAN, California
    JOE BARTON, Texas                      Ranking Member
      Chairman Emeritus                  JOHN D. DINGELL, Michigan
    ED WHITFIELD, Kentucky               FRANK PALLONE, Jr., New Jersey
    JOHN SHIMKUS, Illinois               BOBBY L. RUSH, Illinois
    JOSEPH R. PITTS, Pennsylvania        ANNA G. ESHOO, California
    GREG WALDEN, Oregon                  ELIOT L. ENGEL, New York
    LEE TERRY, Nebraska                  GENE GREEN, Texas
    MIKE ROGERS, Michigan                DIANA DeGETTE, Colorado
    TIM MURPHY, Pennsylvania             LOIS CAPPS, California
    MICHAEL C. BURGESS, Texas            MICHAEL F. DOYLE, Pennsylvania
    MARSHA BLACKBURN, Tennessee          JANICE D. SCHAKOWSKY, Illinois
      Vice Chairman                      JIM MATHESON, Utah
    PHIL GINGREY, Georgia                G.K. BUTTERFIELD, North Carolina
    STEVE SCALISE, Louisiana             JOHN BARROW, Georgia
    ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
    CATHY McMORRIS RODGERS, Washington   DONNA M. CHRISTENSEN, Virgin
    GREGG HARPER, Mississippi            Islands
    LEONARD LANCE, New Jersey            KATHY CASTOR, Florida
    BILL CASSIDY, Louisiana              JOHN P. SARBANES, Maryland
    BRETT GUTHRIE, Kentucky              JERRY McNERNEY, California
    PETE OLSON, Texas                    BRUCE L. BRALEY, Iowa
    DAVID B. McKINLEY, West Virginia     PETER WELCH, Vermont
    CORY GARDNER, Colorado               BEN RAY LUJAN, New Mexico
    MIKE POMPEO, Kansas                  PAUL TONKO, New York
    ADAM KINZINGER, Illinois             JOHN A. YARMUTH, Kentucky
    H. MORGAN GRIFFITH, Virginia
    GUS M. BILIRAKIS, Florida
    BILL JOHNSON, Ohio
    BILLY LONG, Missouri
    RENEE L. ELLMERS, North Carolina

                                      (ii)
                        Subcommittee on Energy and Power

                             ED WHITFIELD, Kentucky
                                     Chairman
    STEVE SCALISE, Louisiana             BOBBY L. RUSH, Illinois
      Vice Chairman                        Ranking Member
    RALPH M. HALL, Texas                 JERRY McNERNEY, California
    JOHN SHIMKUS, Illinois               PAUL TONKO, New York
    JOSEPH R. PITTS, Pennsylvania        JOHN A. YARMUTH, Kentucky
    LEE TERRY, Nebraska                  ELIOT L. ENGEL, New York
    MICHAEL C. BURGESS, Texas            GENE GREEN, Texas
    ROBERT E. LATTA, Ohio                LOIS CAPPS, California
    BILL CASSIDY, Louisiana              MICHAEL F. DOYLE, Pennsylvania
    PETE OLSON, Texas                    JOHN BARROW, Georgia
    DAVID B. McKINLEY, West Virginia     DORIS O. MATSUI, California
    CORY GARDNER, Colorado               DONNA M. CHRISTENSEN, Virgin
    MIKE POMPEO, Kansas                      Islands
    ADAM KINZINGER, Illinois             KATHY CASTOR, Florida
    H. MORGAN GRIFFITH, Virginia         JOHN D. DINGELL, Michigan (ex
    JOE BARTON, Texas                        officio)
    FRED UPTON, Michigan (ex officio)    HENRY A. WAXMAN, California (ex
                                             officio)
                                     ------

                  Subcommittee on Environment and the Economy

                             JOHN SHIMKUS, Illinois
                                     Chairman
    PHIL GINGREY, Georgia                PAUL TONKO, New York
      Vice Chairman                        Ranking Member
    RALPH M. HALL, Texas                 FRANK PALLONE, Jr., New Jersey
    ED WHITFIELD, Kentucky               GENE GREEN, Texas
    JOSEPH R. PITTS, Pennsylvania        DIANA DeGETTE, Colorado
    TIM MURPHY, Pennsylvania             LOIS CAPPS, California
    ROBERT E. LATTA, Ohio                JERRY McNERNEY, California
    GREGG HARPER, Mississippi            JOHN D. DINGELL, Michigan
    BILL CASSIDY, Louisiana              JANICE D. SCHAKOWSKY, Illinois
    DAVID B. McKINLEY, West Virginia     JOHN BARROW, Georgia
    GUS M. BILIRAKIS, Florida            DORIS O. MATSUI, California
    BILL JOHNSON, Ohio                   HENRY A. WAXMAN, California (ex
    JOE BARTON, Texas                        officio)
    FRED UPTON, Michigan (ex officio)
                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Ed Whitfield, a Representative in Congress from the
      Commonwealth of Kentucky, opening statement....................     2
        Prepared statement...........................................     3
    Hon. Bobby L. Rush, a Representative in Congress from the State
      of Illinois, opening statement.................................     3
    Hon. John Shimkus, a Representative in Congress from the State of
      Illinois, opening statement....................................     5
        Prepared statement...........................................     5
    Hon. Paul Tonko, a Representative in Congress from the State of
      New York, opening statement....................................     6
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     7
        Prepared statement...........................................     8
    Hon. Henry A. Waxman, a Representative in Congress from the State
      of California, opening statement...............................     9

                                    Witness

    Gina McCarthy, Administrator, Environmental Protection Agency....    10
        Prepared statement...........................................    13
        Answers to submitted questions...............................    64

                               Submitted Material

    Slide, dated February 20, 2013, URS Corporation, submitted by Mr.
      Olson..........................................................    47
    Slide, dated January 21, 2010, Nature, submitted by Mr. Olson....    49

                       THE FISCAL YEAR 2015 EPA BUDGET

                                  ----------

                            WEDNESDAY, APRIL 2, 2014

                      House of Representatives,
                      Subcommittee on Energy and Power,
                                 joint with the
           Subcommittee on Environment and the Economy,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittees met, pursuant to call, at 10:05 a.m., in
    room 2123 of the Rayburn House Office Building, Hon. Ed
    Whitfield (chairman of the Subcommittee on Energy and Power)
    presiding.
        Present from the Subcommittee on Energy and Power:
    Representatives Whitfield, Scalise, Hall, Pitts, Terry,
    Burgess, Latta, Cassidy, Olson, McKinley, Gardner, Kinzinger,
    Griffith, Barton, Upton (ex officio), Rush, Tonko, Engel,
    Green, Capps, Barrow, Christensen, and Waxman (ex officio).
        Present from the Subcommittee on Environment and the
    Economy: Representatives Shimkus, Murphy, Bilirakis, Johnson,
    Pallone, DeGette, and McNerney.
        Also present: Representative Long.
        Staff present: Nick Abraham, Legislative Clerk; Gary
    Andres, Staff Director; Charlotte Baker, Deputy Communications
    Director; Matt Bravo, Professional Staff Member; Allison
    Busbee, Policy Coordinator, Energy and Power; Megan Capiak,
    Staff Assistant; Jerry Couri, Senior Environmental Policy
    Advisor; Patrick Currier, Counsel, Energy and Power; Tom
    Hassenboehler, Chief Counsel, Energy and Power; Ben Lieberman,
    Counsel, Energy and Power; Alexa Marrero, Deputy Staff
    Director; David McCarthy, Chief Counsel, Environment and the
    Economy; Brandon Mooney, Professional Staff Member; Mary
    Neumayr, Senior Energy Counsel; Mark Ratner, Policy Advisor to
    the Chairman; Chris Sarley, Policy Coordinator, Environment and
    the Economy; Peter Spencer, Professional Staff Member,
    Oversight; Tom Wilbur, Digital Media Advisor; Phil Barnett,
    Democratic Staff Director; Alison Cassady, Democratic Senior
    Professional Staff Member; Jacqueline Cohen, Democratic Senior
    Counsel; Greg Dotson, Democratic Staff Director, Energy and the
    Environment; Caitlin Haberman, Democratic Policy Analyst;
    Alexandra Teitz, Democratic Senior Counsel, Environment and
    Energy; Kate Stoll, Democratic Fellow; and Ryan Schmit,
    Democratic EPA Detailee.
        Mr. Whitfield. I would like to call the hearing to order
    this morning. The title of our hearing is the Fiscal Year 2015
    EPA Budget, and we certainly want to welcome EPA Administrator
    Gina McCarthy for being here with us today and talking about
    the budget and other actions that are taking place over at EPA.
    You want to start my 3 minutes?
        Each of us that are giving opening statements today will be
    given 3 minutes because we want to be able to get to the budget
    and talk about a lot of issues.

      OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN
               CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

        Jonathan Turley, a professor over at George Washington
    University, was testifying before the Judiciary Committee
    recently, and in his testimony he said that President Obama's
    extensive use of executive orders, executive actions, and
    unilateral regulatory action threatens to enable President
    Obama to become a government unto himself.
        Now Professor Turley said that he had voted for President
    Obama but that he was genuinely concerned about this excessive
    use of executive authority. And when President Obama went to
    Copenhagen in 2009, he committed the United States to certain
    things relating to climate change. In his Georgetown speech and
    in his State of the Union Address, he has repeatedly indicated
    that since Congress does not act in the way that he wants it to
    act that he is going to do things by executive order and he
    will go it alone. I would say first of all that Congress has
    acted in the areas that the President is concerned about.
    Congress made the decision, a Democratic-controlled Senate,
    made the decision that we would not adopt Cap and Trade.
        And then I might say that 2 weeks ago the House of
    Representatives passed legislation for the first time ever,
    gave EPA the authority to regulate CO2 emissions,
    but set parameters. And in our efforts to work with the
    administration on that legislation, we were not responded to.
    And even Mr. Dingell has repeatedly said when the Clean Air Act
    was passed, it was never thought that CO2 emissions
    would be adopted.
        One of the things I am most concerned about is that the New
    Source Performance Standards for new electricity generating
    units, this proposal requires carbon capture and storage for
    cold-fired power plants which are not commercially available,
    have not been adequate demonstrated. The Energy Policy Act of
    2005 clearly prohibits EPA from relying on federally funded
    projects when determining whether CCS is adequately
    demonstrated, and yet EPA went and took three projects in the
    United States--one in Texas, one in California and one in
    Louisiana, I mean Mississippi--none of which are in operation.
    Two of them have not even started construction. And so I think
    this reflects how aggressive the administration is being.
        As a matter of fact, it was pointed out to us that GAO's
    database said that EPA had published over 1,900 rules during
    the President's first term alone.
        So we have some genuine concerns, and my time is expired.
        [The prepared statement of Mr. Whitfield follows:]

                    Prepared statement of Hon. Ed Whitfield

        I would like to thank EPA Administrator Gina McCarthy for
    appearing before us today, and I certainly hope that we can
    shed some light on a number of issues with the agency's
    proposed budget and priorities for the coming fiscal year.
        EPA's budget for FY 2015 is $7.89 billion. My biggest
    concerns are with EPA's regulatory agenda and particularly its
    efforts to target energy, including coal which is the Nation's
    largest source of electricity.
        Although the President pledged to ``cut red tape'' in his
    State of the Union address, EPA is clearly moving in the
    opposite direction, piling many new major rules on top of all
    the existing ones. This includes an expansive and expensive
    global warming agenda that Congress never authorized and that
    the agency admits will have only a trivial impact on the
    earth's future temperature. In other words, EPA's climate
    agenda is all economic pain for no environmental gain, and may
    well be a part of the reason that the economy and job growth
    have remained sluggish throughout the Obama presidency.
        Just one rule impacting coal-fired power plants, the
    Mercury and Air Toxics Standards, has been estimated by the
    agency to cost $9.6 billion annually--more than the agency's
    entire budget. And the initial real-world experience with this
    rule indicates that it may cost quite a bit more than $9.6
    billion and lead to numerous plant closures. Like many of EPA's
    most extreme regulations, this rule is affecting the security
    and affordability of the energy sector.
        The regulations targeting coal have already increased the
    number of coal-fired power plant shutdowns. According to the
    North American Electric Reliability Corporation, these closures
    will accelerate in the years ahead and could lead to serious
    reliability concerns.
        And I might add that during this very cold winter, we saw
    the limits of relying too heavily on natural gas to fill the
    void left by coal. In fact, many coal-fired units pressed into
    service to meet peak demand during the coldest days are among
    those slated to be shut down in the near future. This winter
    was an early warning that if EPA's anti-coal agenda is left
    unchecked, there will be serious consequences for electricity
    reliability and affordability.
        Time and time again, we've seen EPA set extreme standards.
    We've witnessed this with the Utility MACT and the Regional
    Haze Program, with astronomical compliance costs for States and
    utilities, and in some cases, are causing power plants to shut
    down. And the toughest rules for coal are yet to be finalized.
    Anyone who doubted that EPA is trying to ``bankrupt the coal
    industry'' as President Obama promised should have been
    convinced by proposed New Source Performance Standards for new
    electric utility generating units. In effect, this proposal
    requires carbon capture and storage (CCS) for coal-fired power
    plants, which is not commercially available now and is unlikely
    to become so for a long time. If this isn't a ban on new coal,
    then nothing is.
        The Clean Air Act requires that New Source Performance
    Standards be based on technologies that are adequately
    demonstrated. In the agency's very strained attempt to claim
    that CCS is adequately demonstrated, EPA relied on projects in
    the Federal Government's Clean Coal Power Initiative. But the
    Energy Policy Act of 2005 clearly forbids EPA from relying on
    such federally funded projects when determining whether CCS is
    adequately demonstrated. The provision in EPAct 05 is an
    explicit prohibition that Congress intended to include in order
    to prevent EPA from prematurely mandating the use of a
    technology before it is commercially viable.
        This committee's November 15, 2013, letter to EPA specified
    these violations, which are all too typical of an agency that
    routinely exceeds its authority to achieve a predetermined
    agenda. And the agency's failure to respond to the letter is
    all-too-typical of the lack of EPA's transparency and
    responsiveness.
        I hope we can explore these and other serious concerns with
    both the substance and the legality of EPA's regulatory agenda
    for the fiscal year ahead.

        Mr. Whitfield. So at this time, I would like to recognize
    the gentleman from Illinois, Mr. Rush, for his opening
    statement.

     OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF ILLINOIS

        Mr. Rush. I want to thank you, Mr. Chairman, and I
    certainly want to thank the Administrator, Administrator
    McCarthy, for being with us here today. I want to take a few
    moments, just a quick sentence or so, to extend my
    congratulations to you. I have--was on leave of absence for a
    number of months due to my wife's illness. So I didn't get a
    chance to say congratulations. So I want to congratulate you.
    It is belated, but it is heartfelt.
        Madam Administrator, your visit here could not be more
    timely as it coincides with the release earlier this week on
    the second report from the Intergovernmental Panel on Climate
    Change which warn that the detrimental effects of man-made
    climate change are being felt, and it also warned that if we
    fail to address this issue, we can continue to expect dire
    consequences for humans and natural systems all across our
    globe.
        According to the report, the flooding, the heat waves, the
    reduced crop yields that we have witnessed recently both here
    and abroad are only going to get worse if we do not act to curb
    the effects of climate change sooner rather than later. In
    fact, as a Chairman of the IPCC noted when the study was
    released, and I quote, ``Nobody on the planet is going to be
    untouched by the impacts of climate change.''
        So Madam Administrator, I for one want to applaud you,
    applaud your agency, for your outstanding work for being on the
    front lines for our Nation's fight against the impacts of
    climate change, and I certainly do not envy the task that all
    of you face. At a time when the EPA's budget is consistently
    being slashed, the American people are still relying on you and
    your Agency to do everything in its power to protect the public
    health, both today and for future generations of American
    families.
        The President's fiscal year 2015 budget request of $7.89
    billion represents a $310 million decrease from last year's
    level and in fact represents a smaller budget than that which
    was enacted in fiscal year 2003 under President Bush. And my
    Republican colleagues will slash this budget even further in an
    attempt to hamstring your agency, all while the world's leading
    scientists warn us of all the calamitous consequences if we
    fail to curb the effects of climate change and curb the effects
    of it now.
        Madam Secretary, again, I applaud the steps that the Obama
    administration under your leadership is already taking to
    reduce our Nation's global footprint, and I look forward to
    hearing your thoughts and your comments on the latest IPCC
    report as well as the constructive ways we can address this
    urgent issue right now.
        Thank you, and with that, I yield the balance of my time to
    Mr. Tonko.
        Mr. Whitfield. Well, you are out of time, Mr. Rush. I went
    21 seconds over. You have gone a minute and 10 seconds over
    because we only had 3 minutes.
        Mr. Rush. Well, I ask unanimous consent that my colleague,
    Mr. Tonko, be given 2 minutes for an opening statement.
        Mr. Whitfield. He will get 3 minutes.
        Mr. Rush. Three minutes?
        Mr. Whitfield. Yes, he will get three.
        Mr. Rush. You are most gracious.
        Mr. Whitfield. I am glad you are back, by the way.
        Mr. Rush. Thank you.
        Mr. Whitfield. At this time I recognize--this is a joint
    hearing, so he gets his 3 minutes. He went a minute over and I
    went 21 seconds over, and now I am going to recognize Mr.
    Shimkus for his 3 minutes.

      OPENING STATEMENT OF HON. JOHN SHIMKUS, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF ILLINOIS

        Mr. Shimkus. And I will try to be punctual. Thank you, Mr.
    Chairman. Welcome, Administrator McCarthy, and thank you for
    appearing today. I plan to focus my comments and later my
    questions on programs within my subcommittee's jurisdiction.
        Your authorities under the Safe Drinking Water Act and
    Solid Waste Disposal Act, the Toxic Substances Control Act and
    the Superfund all come under the Environment and the Economy
    Subcommittee. These programs touch the lives of most every
    American citizen.
        On several issues, EPA and our subcommittee have worked
    together closely and successfully on a bipartisan basis to
    solve problems. For example, with your support we enacted E-
    Manifest in October 2012 to set up an electronic reporting
    program for hazardous materials under RCRA. Once we got
    consensus around the basic policy, we had to negotiate the
    complex thickets of budget rules, but we finally got it through
    the House and Senate and to the President for his signature. We
    are looking for a good progress report on E-Manifest today.
        In another example, on drinking water we worked with you
    and in the end, in the last year, to solve the problem you
    identified involved fire hydrants. In record time, we were able
    to agree on the scope of the issue and draft legislation and
    move it through Congress to the President's desk. As a result,
    water system managers and firefighters across America never had
    to face the terrible dilemma whether or not to keep a hydrant
    out of service just to comply with a restriction that none of
    us intended to impose.
        So with those two solutions under our belts, let us turn
    together to TSCA reform. Just in the last 10 months I have
    convened six hearings on TSCA. In February we released a
    discussion draft of a modernization bill. We have gotten
    comments from a wide range of stakeholders. EPA has given us
    some valuable but preliminary technical assistance, but many
    large policy issues still remain unresolved. We want to resolve
    those with you, and we hope you share our ambition and sincere
    desire to make this a collaborative process.
        Our Founding Fathers never said it would be easy getting
    agreement among the President and a majority of the House and
    the Senate, but that is no reason not to try. We look forward
    to working closely with you on these and other issues to
    protect our citizens' health and their way of life. And with
    that, Mr. Chairman, I yield back the balance of my time.
        [The prepared statement of Mr. Shimkus follows:]

                    Prepared statement of Hon. John Shimkus

        Welcome, Administrator McCarthy, and thank you for
    appearing today. I plan to focus my comments and later my
    questions on programs within my subcommittee's jurisdiction.
    Your authorities under the Safe Drinking Water Act, the Solid
    Waste Disposal Act, the Toxic Substances Control Act (TSCA),
    and Superfund all come under the Environment and the Economy
    Subcommittee. These programs touch the lives of almost everyone
    in the United States.
        On several issues EPA and our subcommittee have worked
    together closely and successfully on a bipartisan basis to
    solve problems. For example, with your support we enacted E-
    manifest in October 2012, to set up an electronic reporting
    program for hazardous materials under RCRA. Once we got
    consensus around the basic policy, we had to negotiate the
    complex thickets of budget rules, but we finally got it through
    the House and Senate and to the President for his signature. We
    are looking for a good progress report on E-manifest today.
        In another example, on drinking water, we worked with you
    at the end of last year to solve the problem you identified
    involving fire hydrants. In record time we were able to agree
    on the scope of the issue, draft legislation, and move it
    through Congress to the President's desk. As a result, water
    system managers and firefighters across America never had to
    face a terrible dilemma: whether or not to keep a fire hydrant
    out of service just to comply with a restriction that none of
    us intended to impose.
        So with those two solutions under our belts, let's turn
    together to TSCA reform. Just in the last 10 months, I've
    convened six hearings on TSCA and in February we released a
    discussion draft of a modernization bill. We've gotten comments
    from a wide range of stakeholders. EPA has given us some
    valuable, but preliminary technical assistance, but many large
    policy issues still need resolution. We want to resolve those
    with you, and we hope you share our ambition and sincere desire
    to make this a collaborative process.
        Our Founding Fathers never said it would be easy getting
    agreement among the President and a majority of the House and
    of the Senate. But that's no reason to not try. We look forward
    to working closely with you on these and other issues to
    protect our citizens' health and their way of life.

        Mr. Whitfield. The gentleman yields back. This time I want
    to recognize the gentleman from New York, Mr. Tonko, for his 3-
    minute opening statement.

       OPENING STATEMENT OF HON. PAUL TONKO, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF NEW YORK

        Mr. Tonko. Thank you, Mr. Chairman. Good morning. As we
    know, we are here to discuss the fiscal year 2015 budget
    request for the Environmental Protection Agency. Welcome
    Administrator McCarthy, and thank you for being here today, and
    more importantly, thank you for your tremendous leadership of a
    very important agency.
        I however regret that I find the administration's budget
    request for your Agency disappointing. A budget does more than
    lay out the annual priorities for the current year's work. It
    is or it should be a statement about what we aspire to for the
    future. This budget is not very inspiring. There are many unmet
    needs in communities across this great country. When I visit
    towns across my district, I see the need, and I think we should
    be addressing that need.
        We have been cruising along on investments that our
    parents' generation made in this country. They invested in the
    infrastructure to deliver clean, safe drinking water, drinking
    water that is delivered to American homes across this country.
    There should be no question that we maintain that level of
    service, not reduce our commitment. Water is basic to
    everything we do in our daily lives and in our economy. Water
    is essential for agriculture, for fisheries, for recreation,
    manufacturing, transportation, energy development and yes, for
    daily living.
        The 2013 Infrastructure Report Card produced by the
    American Society of Civil Engineers gave our Nation a D on
    drinking water infrastructure, and that D was not meant to
    stand for delightful. New York State, by their estimates, will
    require an investment of $27 billion over the next 2 decades.
    There are other States facing that same situation. That is a
    huge need. In addition to the backlog of infrastructure repair
    and replacement, we also need to redesign some of our
    infrastructure to withstand the new conditions we will face due
    to climate change.
        So we cannot maintain our edge as a Nation in this 21st
    Century with infrastructure from the 19th and 20th Centuries in
    need of repair. We could be putting many people to work,
    rebuilding the infrastructure to support our modern society and
    maintain a strong and vibrant economy.
        There are some important initiatives under way as part of
    the President's Climate Action Plan, and I am supportive of
    that. I am very encouraged by it. But we could do much better
    for our citizens and for future generations.
        I want to work with you to make the Federal Government a
    stronger partner with State and local governments in reducing
    the backlog of infrastructure projects. We all want to ensure
    that tax dollars are spent efficiently and effectively, but
    doing more with less is not going to address the situation
    where need is growing. It is not a sustainable strategy, and it
    will not deliver the 21st Century infrastructure that we need.
    My question: Why put investment off? Infrastructure problems
    cost money, and the longer projects are delayed the higher the
    cost to restore services.
        Administrator McCarthy, I know you believe that
    environmental protection and economic development go hand in
    hand. I have seen you in action. I know you are committed. I
    want to work with you to continue to demonstrate the power of
    that combination. And again, I thank you for appearing before
    this joint committee hearing. I yield back
        Mr. Whitfield. At this time I will recognize the gentleman
    of the full committee, Mr. Upton, for 3 minutes.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Upton. Well, thank you, Mr. Chairman, and welcome. I
    want to begin as I did last year by acknowledging and
    applauding the success of our Nation's efforts to protect and
    improve our environment over the years.
        Under existing regulations our air quality has improved
    dramatically. This is something that our entire country should
    be proud of. EPA reports that total emissions of toxic air
    pollutants decreased by approximately 42 percent between 1990
    and 2005, and between 1980 and 2010, total emissions of the six
    principal air pollutants dropped by 63 percent.
        I want to commend EPA's efforts to resolve issues such as
    Superfund cleanups, particularly appreciative of your focus
    along with my two Senators on the Kalamazoo River, particularly
    the Allied site and look forward to getting that project
    accomplished. And total removal may well turn out to be the
    most cost-effective solution in the long run.
        But in spite of this success over the last few decades, I
    do have some concern over EPA's regulatory trajectory. The
    number and scope of EPA's regulations is continuing to grow
    without precedent. This administration is seeking to regulate
    sometimes where they failed to legislate, and that pace is
    continuing with the release of several major rules that impose
    indeed billions of dollars in costs with somewhat questionable
    benefits.
        These rules continue to threaten not only electric
    reliability and affordability, but they certainly shake up the
    confidence in the manufacturing renaissance under way. EPA
    continues to regulate too much too fast. No wonder so many job
    creating companies are holding back on new investment. They not
    only face rising energy and compliance costs but also
    uncertainty as to what those new regs are going to require.
        The worst of EPA's regulatory agenda may yet to come,
    especially with the greenhouse gas regs for power plants. We
    have yet to see fully what EPA plans proposed for existing
    power plants or the full impact on consumers' electric bills
    and unemployment. But if we allow that agenda to continue
    without the proper oversight, we may well see higher costs,
    more jobs lost and widespread problems.
        We get constant reassurances from the administration that
    costs are minimal and benefits always trump costs when it comes
    to EPA's regs. Of course the health law was also rolled out
    with a host of assurances that certainly fell woefully short.
    Many EPA rules were introduced with the same kind of rosy
    economic promises and while they are proving to be just as
    detached from reality.
        When I meet with manufacturers, I usually hear about the
    problems with the health law and yes, problems with EPA. Both
    threaten job and global competitiveness and do so at a time
    when low energy prices are finally giving American
    manufacturing an edge.
        Administrator McCarthy, you were recently quoted in the New
    York Times saying that you want to avoid a repeat of the
    Obamacare roll-out debacle. I fear that it may be too late, but
    I certainly hope that we can work together to limit any further
    damage. And again, welcome. We appreciate your testimony. I
    yield back.
        [The prepared statement of Mr. Upton follows:]

                     Prepared statement of Hon. Fred Upton

        I want to begin as I did last year by acknowledging and
    applauding the success of our Nation's efforts to protect and
    improve our environment over the years. Under existing
    regulations, our air quality has improved dramatically. This is
    something that our entire country should be proud of--EPA
    reports that total emissions of toxic air pollutants decreased
    by approximately 42 percent between 1990 and 2005 and that
    between 1980 and 2010, total emissions of the six principal air
    pollutants dropped by 63 percent.
        I want to commend EPA's efforts to resolve issues such as
    Superfund clean-ups. I particularly appreciate your focus on
    the Kalamazoo River, particularly the Allied site, and look
    forward to getting that project accomplished. Total removal may
    well turn out to be the most cost-effective solution in the
    long run.
        In spite of this success over the last few decades, I have
    some concerns with EPA's regulatory trajectory. The number and
    scope of EPA regulations is continuing to grow without
    precedent. The Obama administration is seeking to regulate
    where they failed to legislate, and this pace has continued
    with the release of several major rules that impose billions of
    dollars in cost with questionable benefits.
        These rules continue to threaten not only electric
    reliability and affordability, but they shake up the confidence
    in the manufacturing renaissance underway. EPA continues to
    regulate too much too fast. No wonder so many job-creating
    companies are holding back on new investment--they not only
    face rising energy and compliance costs, but also uncertainty
    as to what new regulations will require.
        The worst of EPA's regulatory agenda may be yet to come,
    especially with its greenhouse gas regulations for power
    plants. We have yet to see fully what EPA plans to propose for
    existing power plants, or the full impact on consumers'
    electric bills and on employment. But if we allow this agenda
    to continue, we may well see higher costs, more jobs lost, and
    widespread problems.
        We get constant reassurances from this administration that
    costs are minimal and benefits always trump costs when it comes
    to EPA regulations. Of course, the health law was also rolled
    out with a host of assurances that fell woefully short. Many
    EPA rules were introduced with the same kinds of rosy economic
    promises, and they are proving to be just as detached from
    reality.
        When I meet with manufacturers, I usually hear about the
    problems with the health law and problems with the EPA. Both
    threaten jobs and global competitiveness, and do so at a time
    when low energy prices are finally giving American
    manufacturers an edge.
        Administrator McCarthy was recently quoted in the New York
    Times saying that she wants to avoid a repeat of the Obamacare
    rollout debacle. I fear that it may be too late, but I
    certainly hope that we can work together to limit any further
    damage.

        Mr. Whitfield. The gentleman yields back. At this time, I
    recognize the gentleman from California, Mr. Waxman, for a 3-
    minute opening statement.

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

        Mr. Waxman. Thank you very much. I might just make a note
    that Obamacare brought in 7 million people and appears to be
    quite successful despite the aspirations of our Republicans to
    trash it.
        Administrator McCarthy, I thank you very much for being
    here and more importantly, thank you for your service to the
    Nation at the Environmental Protection Agency. Since its
    inception, EPA has worked to make our air safer to breathe, our
    water safer to drink, and today EPA is on the front lines of
    effort to address the greatest environmental challenge of our
    time, climate change.
        Administrator McCarthy, Americans are counting on you to
    carry out the President's Climate Action Plan and cut dangerous
    carbon pollution. Earlier this week the world's scientists
    sounded an alarm once again to alert us of the high stakes if
    we fail to take immediate action on climate change.
        The Intergovernmental Panel on Climate Change, or IPCC,
    released a new report on the impacts of climate change, the
    future risks from a changing climate and opportunities for
    action to mitigate those risks. This new IPCC report concludes
    that the effects of climate change are evident on all
    continents and in all oceans. To learn about that report and
    what scientists have to say, we have to read the newspaper
    because our committee will not hold a hearing with scientists
    to hear from them directly.
        Climate change is not something we can have the luxury to
    worry about at some time in the future. It is already here. And
    the longer we wait to respond, the more pervasive, severe and
    irreversible the impacts will be. The IPCC concludes sea level
    rise threatens coastal areas with flooding and erosion. The
    oceans will grow more acidic threatening fisheries and those
    who depend on them for their livelihoods. Extreme weather
    events would become more frequent, threatening lives as well as
    critical infrastructure. Heat waves will take more lives. No
    one would be immune from the consequences of climate change,
    but the impacts will be especially severe for those who are
    least able to respond and adapt.
        I know you understand this and are committed to making the
    Environmental Protection Agency one of the world's leaders in
    the effort to protect families from dangerous climate change. I
    want you to know that I am committed to supporting your
    efforts. EPA does not often get a warm welcome in the House of
    Representatives. Don't take it personally. In fact, the House
    has voted 194 times in the last 3 years to undermine the
    Agency, 748 times to weaken fundamental environmental
    protections. That is a testament to how out of touch Congress
    has become and to the vast influence of the special interests.
    It is no way a reflection of the quality of your work at EPA
    which has been so superb.
        So I hope you will continue to do exactly what you have
    been doing, which is taking forceful, reasonable steps to
    protect the environment for our children and future
    generations. Families across America are counting on you to do
    what is right and to stand up to special interests that seem to
    be vocal in this institution, that those special interests
    would endanger our future. I yield back my time.
        Mr. Whitfield. Thank you very much, Mr. Waxman. Now at this
    time, Ms. McCarthy, I will recognize you for your 5-minute
    opening statement, and I understand you are accompanied today
    by the Acting CFO, Ms. Froehlich. We welcome you. We are
    thrilled that you are here with us this morning, and it will be
    a joyful morning.
        So at this time, Ms. McCarthy, you are recognized for 5
    minutes.

       STATEMENT OF GINA MCCARTHY, ADMINISTRATOR, ENVIRONMENTAL
                           PROTECTION AGENCY

        Ms. McCarthy. Thank you. Thank you Chairman Whitfield, also
    Chairman Shimkus, Ranking Members Rush and Tonko, it is great
    to be here in the----
        Mr. Whitfield. Would you mind just pulling the microphone a
    little bit closer?
        Ms. McCarthy. Sure. Is that better? Let us hope I don't
    blow you away later. But it is great to be here, and thanks for
    the opportunity to discuss EPA's proposed fiscal year 2015
    budget. I am joined by Maryann Froehlich who is the Agency's
    Acting CFO.
        EPA's budget request is $7.89 billion for the fiscal year
    2015 starting October 1, 2014. This budget meets the challenge
    of domestic spending constraints while still fulfilling our
    mission to protect public health and the environment.
        The fiscal year 2015 budget reflects EPA's plans to take
    advantage of new technologies and new regulatory and
    nonregulatory approaches. It recognizes that EPA is part of a
    larger network of environmental partners in our States, our
    tribes and our communities.
        This budget will provide the support for a smaller
    workforce by focusing on real progress in priority areas:
    communities, climate change and air quality, toxics and
    chemical safety, as well as clean water.
        We are asking for $7.5 million and 64 staff in fiscal year
    2015 to help provide green infrastructure, technical assistance
    for up to 100 communities to promote cost-effective approaches
    for water management. In addition, this budget request
    continues our environmental justice efforts. We will do more to
    partner with States, tribes and local governments and other
    Federal agencies. Funding for State and tribal assistance
    grants or our STAG funds are once again the largest percentage
    of the EPA's budget. Addressing the threat from climate change
    is one of the greatest challenges of this and future
    generations. The request designates $199.5 million specifically
    for this work.
        The Agency has added $10 million and 24 FTE's in fiscal
    year 2015 to support the President's Climate Action Plan with
    $2 million designated for adaptation planning. The Agency will
    also focus resources on the development of common sense and
    achievable greenhouse gas standards for power plants, the
    single largest source of carbon pollution. When it comes to
    cutting greenhouse gas emissions, the President's budget
    provides support for the States to help them implement the
    Clean Air Act.
        The EPA's budget requests almost $673 million to support
    work to improve chemical safety for all Americans and
    especially our children. We are requesting $23 million and 24
    FTE in fiscal year 2015 to support activities under the
    President's executive order on chemical safety, as well as
    Agency efforts on chemical prioritization, air toxics, radon,
    and volatile organic compounds in drinking water.
        The Nation's water resources are the lifeblood of our
    communities. We are requesting $1.775 billion for the Clean
    Water and Drinking Water State Revolving Funds. The Agency is
    also directing $8 million and 10 FTE to advance clean water
    infrastructure in sustainable design like the Municipal Storm
    Water Sewer System Program for technical support communities.
    E-Enterprise is a major joint initiative between EPA and the
    States to modernize our business practices and to look towards
    the future. The benefits of implementing just the one
    initiative, the E-Manifest system, includes annual savings
    estimated at $75 million for over 160,000 waste handlers.
        In fiscal year 2015, the Agency is requesting over $1.33
    billion to continue to apply effective approaches for cleanup
    under RCRA, Superfund, Leaking Underground Storage Tanks and
    other authorities. This strategy will ensure land is returned
    to beneficial use. $1.16 billion is requested for Superfund
    which includes a $43.4 million increase for remedial work and
    an increase of $9.2 million for emergency response and removal.
        The fiscal year 2015 budget includes a total of $1.13
    billion in categorical grants. Within that total is over $96
    million for tribal assistance program grants, an $18 million
    increase for pollution control, a $16 million increase for
    environmental information grants and a $15 million increase for
    State and local air quality management. Science is the
    foundation of EPA's work, and science is supported in this
    budget at $537.3 million.
        And lastly, recognizing the importance of the 2-year budget
    agreement Congress reached in December, we are expanding
    opportunities to all Americans as best we can, but the levels
    are not sufficient to expand them to all or to grow the economy
    in ways that we would like. For that reason, across the Federal
    Government, the budget also includes a separate, fully paid-for
    $56 billion initiative. Within this initiative is a climate
    resilience fund which includes $10 million for protecting and
    enhancing coastal wetlands and $5 million to support urban
    forest enhancement and protection.
        Chairmen Whitfield and Shimkus, I thank you for the
    opportunity to testify and also to take your questions.
        [The prepared statement of Ms. McCarthy follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Whitfield. Well, thank you very much, Ms. McCarthy. As
    I said, we appreciate your being here, and I will recognize
    myself for 5 minutes of questions.
        Under your New Source Performance Standards for new
    electric utility generating units, you specifically set the
    emissions standards based on three plants in the United States,
    one in Mississippi, one in Texas and one in California. The one
    in Texas, they have not even started construction. The one in
    California, they have not even started construction. The one in
    Mississippi is being constructed. It is not in operation yet.
    None of them would be built without funding from the Federal
    Government and our tax credits under the Clean Coal Power
    Initiative. And the 2005 Energy Policy Act specifically says
    you cannot--if a facility is receiving funds from the Clean
    Coal Power Initiative, you cannot say that it has been
    adequately demonstrated.
        And we wrote a letter to you back in November asking your
    legal justification for doing this. We still have not heard
    from you all. We have talked to lawyers outside the Congress,
    inside the Congress, and everyone genuinely believes that the
    2005 act explicitly prohibits you from setting an emission
    standard if it is receiving funds from the Clean Coal Power
    Initiative. So how can you proceed with this and what are your
    lawyers telling you and do you intend to respond to our letter?
        Ms. McCarthy. Well, Mr. Chairman, I did listen to you when
    we spoke last time and we received your letter. We did respond
    by including a notice of data availability that is in the
    Federal Register which really explains the impact of EPAct on
    this proposal and the fact that we did fully consider it. We
    did have a very robust record to indicate that CCS was actually
    technically achievable and available the way the law requires.
        Mr. Whitfield. No private company is going to build one of
    those plants without money. You know, the Mississippi plan has
    a serious cost overrun. The Chairman of Southern has said this
    would not have been built without Government support.
        Ms. McCarthy. Mr. Chairman, EPAct requires that we not rely
    solely on those funded projects out of DOE to establish these
    standards. We have a very robust record, well beyond those few
    facilities to indicate that CCS is----
        Mr. Whitfield. Well, you know, that is the Government's
    position, but CEOs of private companies that have a
    responsibility investing say that there is no technology
    available to them to meet the emissions standard that you all
    are setting in this new rule. And the reason we get upset about
    it is, I mean, most people recognize Europe is the green energy
    capital of the world. Twenty-two percent of their electricity
    comes from renewables. And yet, even in Europe where they in
    the last 20 months have mothballed 30 gigawatts of new gas
    powered plants because the gas coming from Russia is so
    expensive, and as you know, their unemployment rate is even
    higher than ours and their economy is more sluggish than ours
    is, but yet last year they imported 53 percent of our coal
    exports, from America. Fifty-three percent went to Europe
    because when the gas prices went so high, they recognized they
    have to rely on coal. And under this rule, we don't have that
    flexibility.
        So what if our gas prices go high? Where are we going to be
    left in America trying to compete in the global marketplace
    when we can't even build a new coal-fired plant?
        Ms. McCarthy. Mr. Chairman, I think we have indicated many
    times that this country is relying on coal. Coal will be part
    of the energy mix for decades to come. We know where investment
    is heading in new coal facilities, and all of them that you are
    talking about, while some of them have received DOE funding,
    they are all relying on advancing CCS, recognizing that they
    are going to be around for decades----
        Mr. Whitfield. CCS is so far off----
        Ms. McCarthy [continuing]. To come.
        Mr. Whitfield [continuing]. I am telling you. It is not
    anywhere commercially viable. So you know, I guess there is no
    sense my continuing to press this point, but I tell you what.
    Those people who are involved in the utility business tell us
    explicitly that they cannot build a new coal-fired plant and
    meet these emission standards. And I think that America is
    being jeopardized by this kind of action. And I suppose event
    though you and I have great respect for each other----
        Ms. McCarthy. We do.
        Mr. Whitfield [continuing]. And I love dealing with you, it
    is just an area of where we have serious disagreements.
        Ms. McCarthy. I understand. Well, Mr. Chairman, we did try
    to address concerns. This proposal actually requires only
    partial CCS. It is an ability to move this technology forward
    and to recognize that it is an opportunity for coal.
        Mr. Whitfield. But all of this is being used for enhanced
    oil recovery, and there are many places where we need plants
    and the enhanced oil recovery cannot play a part in it.
        My time has expired. I am sorry. At this time I recognize
    Mr. Rush for 5 minutes.
        Mr. Rush. Thank you, Mr. Chairman. Administrator McCarthy,
    there is a lot of talk about cutting carbon pollution, and the
    other side don't ever want to talk about cutting the cost of--
    or they think that the cost of climate change is zero. They
    don't ever want to own up to the fact that there is an economic
    price that we are paying and will continue to pay for the
    problems of climate change.
        I want to zero in from the general to the specific. I am
    concerned that the risk and costs of climate change, that it
    would hit the poorest and most vulnerable especially hard. I
    would like for you to give me your view on how does climate
    change multiply risks for people who are already struggling
    with hunger and with poverty and what are some of the impacts
    of climate change that you are most concerned about,
    particularly for low-income communities? As you know, we noted
    earlier that the IPCC issued a report saying that climate
    change impacts are projected to slow down economic growth, make
    poverty reduction more difficult, further erode food security
    and pull all existing and create new poverty traps. So Madam
    Administrator, talk to us a little bit about how climate change
    is going to impact our Nation's and the world's most needy and
    most disadvantaged.
        Ms. McCarthy. Thank you, Ranking Member. The real threat of
    climate change is inaction to address the problem. We have seen
    storms, we have seen intense storms, we have seen droughts, we
    have seen fires that are out of control. Many of these results
    of a changing climate were anticipated and predicted by the
    IPCC when they first started gathering. In the fifth assessment
    they just released indicates that what they predicted and
    feared is actually what we are experiencing now. And they
    predict that that will only get worse, and they also make the
    point that in addition to already large costs that this country
    and others are facing as a result of a changing climate and
    those impacts, that the most vulnerable populations, the poor,
    those living in coastal areas, those most unable to get up and
    move and protect themselves, that are going to be hurt the
    most. That is true in the U.S., and that is true
    internationally as well.
        Mr. Rush. How would you respond to those who say the United
    States shouldn't do anything to cut carbon pollution unless
    other countries do something also unless they act first even?
        Ms. McCarthy. Well, I think the reason that President Obama
    has put out a Climate Action Plan is to have the United States
    show leadership in the international community as well as to
    recognize that the things you need to do to address climate
    change can be enormously beneficial to the economy. If you are
    smart about the actions you are taking, if you use existing
    authority, you do it legally and technically correct, you can
    generate reductions in electricity generation and demand that
    will reduce carbon emissions that will save people money,
    issues like energy efficiency, switch to renewable energy. This
    is the clean energy future, not relying on the clean energy
    past.
        Mr. Rush. Mr. Chairman, I want to yield back the minute
    that I used earlier, so we are even now.
        Mr. Whitfield. OK. Thank you, Mr. Rush, and at this time I
    recognize the gentleman from Texas, Mr. Barton, for 5 minutes.
        Mr. Barton. Thank you, Mr. Chairman, and Ms. McCarthy. It
    is always good to see you.
        Ms. McCarthy. You, too.
        Mr. Barton. Before I begin to give you a hard time, let me
    give you a compliment. I think you and your Agency have been as
    compliant or cooperative as you can on the renewable fuel
    standards and some of those problems. And I want to thank you
    and the Agency for trying to show some flexibility there.
        Now I have to be a little less friendly. I am going to
    follow up on what Chairman Whitfield commented on. I was
    chairman of this committee in 2005 when we passed the Energy
    Policy Act. I was chairman of the Conference Committee, and I
    had a good friend named John Dingell who is still a good
    friend, and there was the ranking member of the Energy and
    Power Subcommittee, a young man named Rick Boucher who is no
    longer in the Congress but was a very, very hard-working
    Congressman from Virginia. And they wanted to do something on
    clean coal technology, especially Rich Boucher. I know Mr.
    Griffith is here, and he replaced Mr. Boucher. So we have got a
    very good replacement in Mr. Griffith.
        But we put in a section to fund some research projects for
    clean coal technology, and I am going to read part of the
    section, Section 402, Project Criteria, and this is actually
    from the law, Public Law 10958. ``To be eligible to receive
    assistance under this subtitle, a project shall advance
    efficiency, environmental performance and cost competitiveness
    well beyond the level of technologies that are in commercial
    service or have been demonstrated on a scale that the Secretary
    determines is sufficient to demonstrate that commercial service
    is viable as of the date of enactment of this Act.'' Well
    beyond the level of technologies that are in commercial
    service. That is Section 402(a).
        If you come over a little bit further on in the section,
    you get into how to actually apply it, and in subtitle (i),
    Applicability, ``No technology or level of emission reduction
    solely by reason of the use of the technology or the
    achievement of emission reduction by one or more facilities
    receiving assistance under this Act shall be considered to be
    adequately demonstrated for purposes of Section 111 of the
    Clean Air Act, 42 U.S.C. 7411. And that is the New Source
    Performance Review section of the Clean Air Act.
        So it is explicitly clear that in funding these
    demonstration projects, whatever their level of CO2
    reduction is, that is not supposed to be used to set for New
    Source Performance Review Standards. Yet, when your Agency put
    out the proposed regulation on those standards, they referred
    to these projects, not one of which is in operation, none of
    which are even actually even close to being operable except for
    the plant down in Mississippi, and it is behind schedule and
    over budget. Now you are an intelligent woman. I think you are
    an honest woman. I think you are an able administrator. How can
    in good conscience you allow these new emission standards be
    promulgated when they are based on technology that hasn't been
    demonstrated yet and by law says you can't use these emission
    standards from these demonstration projects because they are
    not in commercial operation? I mean, Mr. Whitfield is agog, and
    I have to join him.
        Ms. McCarthy. Well, Congressman, our understanding of EPAct
    is that EPA shouldn't be relying solely on our determination of
    what is the best system of emission reduction under 111, just
    solely on the basis of EPAct-funded projects. But we can look
    at them in the context of the larger and more robust technical
    and scientific record, and that is essentially what we are
    doing.
        We know that CCS has been used and is being used at the
    commercial scale in other industries. It has been for many
    years. The technologies available, each component of that
    technology, has been in use, has been tested and is viable. And
    so we are looking at these larger projects that are full-scale
    power plants that are under construction or being developed
    within the context of that larger and more robust context.
        Mr. Barton. Well, my time is expired. I took too long
    asking the question. I have some other questions for the
    record, and I will submit those. But we are not going to go
    away on this.
        Mr. Whitfield. At this time I recognize the gentleman from
    New York, Mr. Tonko, for 5 minutes.
        Mr. Tonko. Thank you, Mr. Chair. Administrator, again,
    welcome.
        Ms. McCarthy. Thank you.
        Mr. Tonko. Residents in my home State of New York and all
    along the East Coast saw last year just how devastating super
    storms can be. As sea levels rise and storms become more
    violent, storm surges will pose risk further and further
    inland. In 2011, the New York State Energy Research and
    Development Authority, or NYSERDA, which I had the honor of
    leading before I came to Congress, completed an authoritative
    report on the impacts of climate change in New York State.
        According to that report, climate change will lead to the
    propagation of storm surges up the Hudson River and will move
    the salt water front further and further upstream. This will
    impair drinking water systems that draw water from the Hudson
    and could potentially contaminate the backup water supply of
    New York City. This year's budget request calls for realigning
    resources to provide technical assistance to water utilities at
    greatest risk from storm surges.
        So my question to you, Administrator, is can you elaborate
    on EPA's efforts to assist these at-risk water systems?
        Ms. McCarthy. Sure. In the President's Climate Action Plan,
    he created a Resiliency Task Force specifically to look at what
    the best practices were that we are seeing across the country
    in adapting to a changing climate. So we are not only working
    nationally and across the United States to identify these
    projects and to get the lessons learned out, but we are also
    specifically focusing on some ways in which you can address
    adaptation to climate that also enhances your ability to
    protect water cost effectively. That is what we call green
    infrastructure. That is a way of actually looking at embracing
    water that is coming in, managing it appropriately and
    preventing the storm water surges and the sewer overflows that
    we see have long-lasting impacts on both our pocketbooks as
    well as the health of our communities.
        Mr. Tonko. Thank you. Technical assistance and tools are
    only part of the solution. Water systems in New York will have
    to adapt, potentially moving intakes and infrastructure at
    great cost, and they are not alone. The drinking water
    infrastructure needs facing our cities and towns continue to
    grow and will grow significantly with climate adaptation costs.
        EPA's most recent survey of drinking water infrastructure
    needs released in June showed $384 billion worth in drinking
    water infrastructure repairs needed over the next 20 years.
    That amount is a significant increase from the previous survey
    demonstrating that investment in infrastructure is not keeping
    pace with need, yet the budget request calls for only $757
    million for the Drinking Water State Revolving Fund, a 16
    percent decrease from this year's enacted levels.
        Administrator McCarthy, if more funds were made available
    through the SRF, could more be done to replace water
    infrastructure that is at the end of its useful life?
        Ms. McCarthy. Yes, sir.
        Mr. Tonko. Well, is EPA considering alternatives to simply
    rebuilding or replacing the drinking water infrastructure that
    is in place and do we have more cost-effective options
    available that could be applied?
        Ms. McCarthy. Well, we are exploring cost-effective options
    so that we can stretch the dollars as much as possible and look
    at keeping the facilities that we have in better operating
    condition. So we are looking not only at our fiscal realities
    of what funds we have to be able to support these efforts, but
    we are looking also at directing some of those funds toward
    these green infrastructure solutions, as well as paying
    specific attention to small sources, to small water systems,
    that have particular challenges in terms of operating and
    generating and leveraging their own funds.
        Mr. Tonko. OK. You know, the discussion not only with EPA
    but across the board for infrastructure are deficient bridges,
    to cite as an example beyond EPA. There is just a need to
    invest in this country, and you know, the longer we prolong in
    that investment as I made in earlier comment, the more
    difficult it is going to be.
        So drinking water infrastructure is essential to our public
    health, and the need is acute. I think the amounts appropriated
    for the drinking water SRF should reflect that need and should
    be considerably higher than this request. I again would hope
    that this budget would not only suggest or invest in where we
    are at but certainly where we want to be, and I hope the goal
    is one that is robust in nature and one that reflects that if
    we don't do this now, we are going to pass it on to generations
    yet unborn. And I believe that morally that is incorrect, and
    certainly financially, it is ineffective. I thank you very much
    again.
        Mr. Whitfield. The gentleman yields back. At this time I
    recognize the gentleman from Texas, Mr. Hall, for 5 minutes.
        Mr. Hall. Thank you, Mr. Chairman. And Mrs. McCarthy, I
    don't totally agree with Mr. Barton's description of your
    history of dealing with businesses that are in trouble or that
    you deem in trouble. And I know you will remember this. When I
    was chairman of Science, Space and Technology, before my
    committee--and it is something I am not even going to mention,
    that you said you are not in the business of creating jobs. And
    it is my hope that the EPA would at least not stand in the way
    of job creation at this time. It is so important.
        As you have to know, abundance of natural gas supplies have
    opened up the possibility for the United States to be in a
    manufacturing renaissance almost. In his State of the Union
    Speech, your President said, ``Business plans invest almost
    $100 billion in new factories to use natural gas.'' He said I
    will cut red tape to help these States to get these factories
    built. Are you familiar with the President's statement during
    the State of the Union?
        Ms. McCarthy. Yes, I am.
        Mr. Hall. And has the President directed to help get these
    factories built?
        Ms. McCarthy. Yes, he has.
        Mr. Hall. And to use some degree of science when making
    decisions that affects these jobs?
        Ms. McCarthy. Yes.
        Mr. Hall. And what steps has he taken to cut that red tape?
        Ms. McCarthy. Actually, he has provided some additional
    funding that is proposed in the fiscal year 2015 budget.
        Mr. Hall. He just added more money on it? No more----
        Ms. McCarthy. No, it is----
        Mr. Hall [continuing]. Suggestions?
        Ms. McCarthy. No, it is actually to allow both us and
    States to work together, hand in hand, to look at how we get
    these cleaner facilities up and operating more quickly and
    through the permit process.
        Mr. Hall. Well, then in that case, when and what steps has
    EPA taken to cut the red tape?
        Ms. McCarthy. Well, we are working very hard to coordinate
    with the States----
        Mr. Hall. I know you are working hard, but what steps are
    you taking?
        Ms. McCarthy. We are working through our normal process of
    collaborating with the States to identify ways in which we can
    work together and provide technical assistance to get these
    permits up and running in a way that they are legally
    defensible and they also meet the requirements of the law.
        Mr. Hall. According to the World Bank and International
    Finance Corporations, ``ease of doing business'' index, the
    United States ranks 34th in the world in the category of
    dealing with construction permits. Are you aware of that?
        Ms. McCarthy. I am not aware of that figure, sir, no.
        Mr. Hall. Or reconstruction permits under the Clean Air
    Act's, quote, prevention of significant deterioration----
        Ms. McCarthy. Yes.
        Mr. Hall [continuing]. Or PSD, as you all call it, the
    application process can take at least 1 year, correct?
        Ms. McCarthy. It can, yes.
        Mr. Hall. It can? It takes that, does it not?
        Ms. McCarthy. That is the prescribed timeline in the Clean
    Air Act.
        Mr. Hall. And there can be an administrative appeals
    process that lasts an additional 6 months or more, correct?
        Ms. McCarthy. There can be appeals, and usually that appeal
    is productive in keeping things out of the court which can end
    up going considerably longer.
        Mr. Hall. Has EPA taken any steps to expedite the process
    for obtaining pre-construction permits under the PSD program,
    and if yes, what are those steps?
        Ms. McCarthy. We have taken recent steps, but one of the
    most important things that we have done is we provide guidance
    to States on how States are dealing with their permits, how
    they can take advantage of issues that have been resolved
    elsewhere. So as they are drafting their permits, they are more
    solid. They understand that they won't be technically
    challenged, and those challenges won't be successful. So we are
    working together to try to share information with you more
    quickly.
        Mr. Hall. Well, I hope you are. In Arkansas, not far from
    my district in Texas, is a John W. Turk Plant. It uses, and
    listen to this, advanced ultra-super critical technology and is
    one of the cleanest and most highly efficient coal plants in
    the world. It came on line in December of 2012. Are you
    familiar with the Turk plant?
        Ms. McCarthy. Somewhat, not totally.
        Mr. Hall. Have you not visited it?
        Ms. McCarthy. Say it again?
        Mr. Hall. Have you not visited the Turk Plant?
        Ms. McCarthy. I have not, no.
        Mr. Hall. One this important as you make these steps that
    you are taking?
        Ms. McCarthy. Well, I am sure I have folks that have been
    there, but that is not a trip I have yet made.
        Mr. Hall. Could the Turk Plant be built under the proposed
    standards for new coal plants that you signed last September?
        Ms. McCarthy. I am not familiar with what its output is in
    terms of its carbon pollution. I do know that ultra-super
    critical can be very, very efficient and they also can be
    easily adapted to look at whether carbon capture sequestration
    is available. So I can't answer this definitively, and I
    certainly will for you.
        Mr. Hall. All right. I appreciate that.
        Ms. McCarthy. But my sense is that it may be close but
    probably not there in terms of----
        Mr. Hall. Thank you for that.
        Ms. McCarthy [continuing]. Fuel facilities' requirements.
        Mr. Hall. My time is running out. I just wanted to know
    what specifically does EPA believe the Turk Plant could do to
    further reduce its carbon dioxide emissions because you are all
    about that regulation, are you not?
        Ms. McCarthy. Well, sir, the carbon capture sequestration
    is only for new facilities. It is not intended to be a measure
    of performance for existing facilities.
        Mr. Hall. I thank you, ma'am.
        Mr. Whitfield. Mr. Hall, I might just say, I have been to
    the Turk plant, and I have been told they cannot meet the new
    emission standards of the New Source----
        Mr. Hall. Well, I think that is very sad.
        Mr. Whitfield. At this time I would like to recognize the
    gentleman from Texas, Mr. Green, for 5 minutes.
        Mr. Green. We need to make sure we are in line. Well, I
    want to thank the chair and the ranking member of our both
    Energy and Environmental subcommittees for holding this joint
    hearing on the EPA budget, and I want to thank our EPA
    Administrator for coming to Houston a few weeks ago. I did not
    realize that was the first time an EPA Administrator had come
    to the CERNA Energy Conference, and of course, there is no
    short of energy conferences in Houston. But that is one of the
    major ones, and I appreciate you being there.
        Like a lot of my colleagues, I have concern with the
    Agency's budget proposal, particularly regarding the cuts in
    Superfund and SRF funding, programs of great importance to our
    industrial and blue collar areas like I have in Houston and
    East Harris County. Administrator McCarthy, because in Texas
    the State didn't agree to issue the GHG permitting, the EPA had
    to implement the Federal Implementation Plan during that time,
    and we have--a significant backlog was created when EPA had to
    issue the permits. When pending NSPS rules for power plants,
    does the EPA expect opposition again from the States'
    permitting these plants?
        Ms. McCarthy. No. It seems to be going well. We did have
    concerns in Texas, and as you know, Congressman, you have been
    calling us about some of those permits, and we are working----
        Mr. Green. That backlog----
        Ms. McCarthy [continuing]. To advance the backlog.
        Mr. Green [continuing]. Is getting brought down.
        Ms. McCarthy. But we are working hand in hand with TCEQ to
    make this transition as smooth as possible, and we seem to be
    working well together.
        Mr. Green. OK. Does the EPA have a plan for effectively
    implementing a Federal Implementation Plan, if that is an
    issue? I don't know if it is in other States or is it just
    Texas?
        Ms. McCarthy. We have no plans at this time, and things are
    going well.
        Mr. Green. Does the Agency plan to address permitting with
    the--my concern is of further reduction in staff and combined
    resources, how is the Agency going to handle that with reduced
    staff under the President's budget and resources?
        Ms. McCarthy. Well, we are looking at a number of different
    types of approaches both that we would use through voluntary
    measures and others to monitor facilities more effectively
    using new technologies so that we can make sure that we keep
    abreast of compliance issues. We are going to work hard and we
    are going to figure out how we can use new technologies and
    practices to do the work that we need to do.
        There is no question that it is challenging to keep up with
    the workload, and I don't doubt that. But there is a reality in
    the budget that we are trying to face here, and we are trying
    to change the way we do business so that we are as effective as
    we have always been.
        Mr. Green. And in our area you know, delay of even longer
    keeps those permits from being issued----
        Ms. McCarthy. Yes.
        Mr. Green [continuing]. But that also keeps those jobs from
    being created in our community.
        Ms. McCarthy. But we are shifting also, sir, some in our
    priority areas where we know that there is increased work. The
    President did increase our budget for climate-related
    activities. He is supporting additional funds for the State in
    that effort so that any work that we can anticipate escalating
    will get the necessary resources. So we have budgeted
    additional funds for that.
        Mr. Green. Let me get back to the Superfund in the budget
    request. We have several superfund sites both in and around our
    congressional district including U.S. oil recovery in Pasadena,
    Texas, San Jacinto River Waste Pits which is on the San Jacinto
    River----
        Ms. McCarthy. Yes.
        Mr. Green [continuing]. Just east of our district now and
    the Cavalcade Street which is an older one. Unfortunately, this
    year's budget's Superfund request is the lowest in the last 12
    years.
        I know Superfund has been a priority for EPA. Do we know
    why the program was cut?
        Ms. McCarthy. Sir, the Superfund program has been
    enormously valuable, and the President's fiscal year budget
    requests $1.157 billion which is really a maintenance budget.
    We would like to be able to increase that, but given fiscal
    realities, we are trying to make the best of our budget
    situation.
        Mr. Green. So under the fiscal year budget proposal, the
    EPA would not have any money for new starts or new clean-ups?
        Ms. McCarthy. I don't know the answer to that question. Let
    me get back to you on this.
        Mr. Green. OK. One of the consequences of the sequestration
    cuts to the Superfund in fiscal year 2013 and 2014, was EPA
    able to begin any new projects during that period of time?
        Ms. McCarthy. Could you repeat that? I am sorry.
        Mr. Green. The sequestration cuts----
        Ms. McCarthy. Yes.
        Mr. Green [continuing]. To the Superfund, in fiscal year
    2013 and 2014, was EPA able to bring any new projects on during
    that period of time?
        Ms. McCarthy. I will get back to you on that as well, sir.
        Mr. Green. OK. Mr. Chairman, I know I am almost down to the
    end of time, so I appreciate your courtesies. Thank you.
        Mr. Whitfield. Thank you very much. At this time I will
    recognize Mr. Upton, the chairman, for 5 minutes.
        Mr. Upton. Well, thank you, and welcome again. As you may
    know, there are a couple of subcommittees meeting today at the
    same time, so we are moving back and forth. I really have just
    two questions, so I am going to ask them both and let you
    respond and then I will yield back.
        One is a Michigan issue, and as you know, I have joined
    with both my two Senators Levin and Stabenow to try and seek
    the full removal of PCBs at the Allied Superfund Site there in
    Kalamazoo. And we are concerned a little bit about the--and we
    join the local community for sure. There are still a number of
    issues yet to be resolved for which the feasibility study
    failed to account, such as a lack of recent data and monitoring
    of wells on site, the availability of alternative remediation
    technologies and the reuse and redevelopment options. Can you
    assure us that these outstanding issues are going to be
    addressed before EPA issues the preferred clean-up options, and
    specifically, how is EPA going to account for the communities'
    redevelopment plans moving forward? That is question one.
        Question two, as you know Mr. Waxman and I worked with many
    members of this committee to try and drive a consensus position
    on the RFS issue. We have done five white papers, a number of
    hearings, obviously bipartisan. We are looking for EPA to do
    their job as well. However, in recent years, EPA has been late
    in finalizing the rule, and in fact for 2014, EPA still has not
    finalized the rule, even though the deadline is usually
    November of the preceding year, as it is in this case. So when
    do you expect to finalize that RVO for 2014, and what are you
    doing to get back on schedule for 2015?
        Ms. McCarthy. OK. Let me quickly answer your questions. We
    certainly, Congressman, have heard from you and a number of
    others about the Allied Paper site, and I need to take a close
    look at that and look at a variety of alternatives. As you
    know, we are going to be preparing a final clean-up plan for
    the summer. In advance of that, we are going to have a hearing
    in the middle of April to take some more comment on this. We
    are going to look at more water sampling there, and we will
    make sure that we listen to all the concerns and address them
    when we put that final clean-up plan together. And I appreciate
    all the concerns that all the Congress and Senate has indicated
    to us but also the concerns of the communities around there.
        On RFS, we are hoping for a June timeline. If I can do it
    more quickly, I would like to. We need to get those final
    levels out. We have certainly heard from many folks on the Hill
    here that they didn't appreciate some of the proposal that we
    put out, that they thought we could have done a better job. We
    got a lot of comments. A lot of good data came in, and we will
    be taking advantage of that in the final proposal.
        Mr. Upton. And do you think you will be back somehow on
    schedule for 2015?
        Ms. McCarthy. That is a very good question. Hope springs
    eternal.
        Mr. Upton. You are not under oath.
        Ms. McCarthy. I am hoping we can do better. One of the
    things that we tried to do with this proposal was to try to
    provide more certainty moving forward. I think these big
    fluctuations and the levels tend to provide uncertainty in the
    investment community, and we certainly don't want that to
    happen.
        Mr. Upton. Thank you. Yield back.
        Mr. Whitfield. The gentleman yields back. At this time I
    recognize the gentleman from California, Mr. Waxman, for 5
    minutes.
        Mr. Waxman. Thank you, Mr. Chairman. On Monday, the
    Intergovernmental Panel on Climate Change, or IPCC, released
    its multi-year report on the state of climate science. The
    world's leading scientists examined the peer-reviewed science
    and confirmed that climate change is already happening on ,
    quote, all continents and across the oceans and will get much
    worse if we do not act.
        The report has been called a tale of two futures because we
    are at a crossroads. We have a choice to make. We can seize the
    moment by taking action to avoid the worst impacts of climate
    change and realize the benefits of transitioning to a clean
    energy economy, or we can decide, Mr. Chairman, not to act. The
    result will be runaway climate change with reduced crop yields,
    more heat waves and disease, decreased water availability, more
    extreme weather events and the mass extinction of many of the
    world's species.
        Administrator McCarthy, do you believe that there is an
    urgent need to act and that our actions now will determine
    whether we avoid the worst impacts of climate change?
        Ms. McCarthy. I do, sir.
        Mr. Waxman. Yet we hear a litany of arguments for why we
    shouldn't act. Some opponents of action argue that humans are
    not causing climate change. Should this argument persuade us?
        Ms. McCarthy. No, sir.
        Mr. Waxman. The IPCC says that there is at least a 95
    percent chance that humans have been the dominant cause of
    observed warming. And yet, that is not enough for this
    committee to feel the urgency.
        We have heard the claim that climate change has no cause.
    Does the science support this argument?
        Ms. McCarthy. No, sir.
        Mr. Waxman. The IPCC says that there will be significant
    economic impacts from sea level rise, flooding, extreme weather
    events, extreme heat, food insecurity and reduced access to
    drinking water.
        We often hear the claim that the U.S. emissions in the
    energy sector are lower than they have been in recent years.
    The implication is that no further action to reduce emissions
    is required. According to the world's leading scientists, is
    this implication true? Are we on track to avoid the worst
    impacts of climate change?
        Ms. McCarthy. No, we are not, sir.
        Mr. Waxman. Your answer is persuasive because much larger
    emission reductions are going to be required than we have been
    seeing recently, which probably has a lot more to do with our
    economic decline during the difficult times.
        Opponents of action also argue that requiring coal-fired
    power plants to control their carbon pollution is part of a war
    on coal. Is that accurate? Is there any way we can reduce our
    emissions by enough to avoid the worst impacts of climate
    change without controlling carbon pollution from power plants?
        Ms. McCarthy. Power plants are the largest stationery
    source of carbon, and it represents about a third of what we
    emit. It needs to be addressed.
        Mr. Waxman. The loudest voices against taking action have
    offered no alternative plan to protect our children and
    grandchildren from the ravages of climate change. Now, Mr.
    Chairman, it is time to choose our path. We could accept all of
    these excuses for inaction and do nothing. The result would be
    a climate catastrophe. Or we could choose to act now to address
    climate change.
        Administrator McCarthy, you are proposing to take
    reasonable action to address this threat, and you have my full
    support. I would be happy to yield to any of my colleagues on
    either side of the aisle because I have a minute left. If not,
    I will yield it back, and thank you, Chairman.
        Mr. Whitfield. Thank you, Mr. Waxman. At this time I
    recognize the gentleman from Illinois, Mr. Shimkus, for 5
    minutes.
        Mr. Shimkus. Thank you, Mr. Chairman. It is great to have
    you here, Administrator.
        Ms. McCarthy. You, too.
        Mr. Shimkus. In January, EPA entered a settlement agreement
    regarding coal ash in which the EPA agreed to finalize the June
    2010 proposed rule by December of this year.
        Ms. McCarthy. That is right.
        Mr. Shimkus. Will the Agency meet that deadline?
        Ms. McCarthy. Yes, we will.
        Mr. Shimkus. Does the Agency intend to finalize the rule
    under subtitle (d)?
        Ms. McCarthy. I can't answer that question, sir. The final
    proposal hasn't yet been developed.
        Mr. Shimkus. You understand our concern with the subtitle
    (d) issue in that----
        Ms. McCarthy. I certainly do.
        Mr. Shimkus. It is our analysis, there is no statutory
    authority to implement an enforceable permit program. Does the
    Agency have a strategy for addressing that tissue?
        Ms. McCarthy. Well, that is part of the consideration, the
    development of the final rule.
        Mr. Shimkus. Thank you. Now I want to turn to TSCA which we
    talked about a little bit before the hearing opened. What is
    the EPA budget to carry out TSCA in fiscal year 2015?
        Ms. McCarthy. Let me take 1 minute to pull that out.
    Thanks.
        Mr. Shimkus. And then the follow-up is how does that
    compare to 2014?
        Ms. McCarthy. EPA has identified $86.4 million and 332.6
    FTE for the TSCA program in the fiscal-year-enacted budget.
    This request is $90.4 million and 321 FTE. So it is an
    increase, sir.
        Mr. Shimkus. How many work plan chemicals has EPA completed
    action on so far and how many in fiscal 2014?
        Ms. McCarthy. We have issued five draft work plans for peer
    review. We are going to finalize those five in 2014. We have
    plans to release draft risk assessments for 19 additional by
    the close of 2015, and 10 of those are expected to have been
    made final.
        Mr. Shimkus. OK. Do you use current authority to collect
    user fees to carry out TSCA?
        Ms. McCarthy. Yes. We actually--TSCA provides limited
    authority for us to collect user fees. It restricts the amount
    that we collect per submission, and it requires those funds to
    go to the Treasury.
        Mr. Shimkus. And can you tell me, and if not later for the
    record, how much of the current budget is offset by user fees?
        Ms. McCarthy. It does not go back to EPA. So I do not know.
    Oh, I am sorry. I believe this year we anticipate $1.8 million
    as collected for new chemical submissions in a year. That is
    generally on average.
        Mr. Shimkus. EPA reviewed some 1,200 chemicals in
    prioritizing 83 substances for the Work Plan Chemicals Program.
    Does EPA have the expertise and the capability to prioritize
    substances in commerce for further review and assessment?
        Ms. McCarthy. We have capability of doing that, yes.
        Mr. Shimkus. And the follow-up here is how quickly can that
    prioritization be done?
        Ms. McCarthy. I can get back to you, sir. But as you know,
    there are 10,000 chemicals we are trying to deal with. The
    numbers we are talking about will not get us there, which is
    why we are looking at other capabilities and screening tools
    that we can develop.
        Mr. Shimkus. Yes, please talk--I think that is a great
    point. Obviously, I am kind of deep in this debate.
        Ms. McCarthy. Yes.
        Mr. Shimkus. So do you feel prioritization is critical in
    trying to resolve this backlog and really answer questions?
        Ms. McCarthy. I think it is important because we have--TSCA
    provides us some authority, certainly not to address the issue
    as robustly as we would like. We are looking at new
    technologies for prioritization based on the information we
    have today. We are also looking at a new technology that we are
    working in a very robust and transparent way to look at a
    computerized toxicology screening process that people think
    there is great value in. We will see. We are going through
    appropriate review of that.
        Mr. Shimkus. Right.
        Ms. McCarthy. But there has to be a better way for us to
    target our resources more effectively to protect public----
        Mr. Shimkus. And the toxicologists are really asking for us
    to use sound science in our ability to do this, and I would
    encourage you as we work through this process, prioritization,
    I think it is a have-to, and this is something we can do.
        Let me just take my remaining 20 seconds to just--I live in
    the St. Louis metropolitan area, although this is really a
    Missouri issue. But since I am on this committee, I would also
    like for you just to take a quick look or get briefed if you
    have not been on the Bridgeton landfill and the West Lake
    landfill, the Senators from the State of Missouri and my
    congressional colleagues. It is an interesting dilemma, and if
    you haven't been briefed on it, it probably is worth your while
    to do so.
        Ms. McCarthy. Sounds fascinating.
        Mr. Shimkus. I yield back my time. Thank you, Mr. Chairman.
        Mr. Whitfield. The gentleman yields back. At this time I
    recognize the gentleman from California, Mr. McNerney, for 5
    minutes.
        Mr. McNerney. Thank you, Mr. Chairman. I want to thank the
    Administrator for serving at the EPA in a time of difficulty
    and sometimes hostility.
        Ms. McCarthy. Opportunity as well, sir.
        Mr. McNerney. Section 319 of the Clean Air Act defines an
    event as an exceptional event if it affects air quality, if it
    is an event that is not reasonably controlled or preventable
    and is an event caused by human activity. These are events
    which the EPA believes normal planning would not be applicable.
    And now California is in its third straight year of drought.
    Droughts tend to make air quality worse by having increased
    dust levels, by wildfires and there is no water to wash that
    away. Are droughts included in the EPA's list of exceptional
    events?
        Ms. McCarthy. The event itself is what we analyze, but we
    are certainly aware that drought can exacerbate these
    exceptional events, and we work with States to identify and
    opportunity to work together to actually excuse those if you
    will from being calculated as part of their attainment
    demonstration.
        Mr. McNerney. What length of time do you think the EPA
    would consider appropriate then when making exception in this
    case or these cases?
        Ms. McCarthy. Well, we work with the States to identify
    what kind of data we need, and then we work very hard to go
    through that data and provide decision points for them.
        We actually have done some really big improvements in how
    we work with States on these exceptional events, most notably
    wind events. We have recently completed a review of how we do
    the exceptional events, what data we require to streamline
    that, and we have been able to get off the books a number of
    uncertainties that the States were concerned about. We are
    going to be tackling other issues like fire as well in the
    future so that we can make sure that we recognize that the
    climate is changing, and we need a streamlined and more robust
    way of working on these issues together.
        Mr. McNerney. Good. Thank you. On another subject, last
    week the administration announced an interagency methane
    strategy. One component involves reducing emissions from the
    coal and gas sectors.
        Ms. McCarthy. Yes.
        Mr. McNerney. Why do you think it is important to reduce
    methane emissions?
        Ms. McCarthy. Yes. Methane is an extremely intensive
    CO2 or source of carbon pollution, and it is
    important for us to get at methane emissions. It is also an
    opportunity to actually have some real impact in the short term
    over the changes we are seeing in climate.
        We are looking at that, and the President released a
    methane strategy, and that is a strategy that goes across the
    U.S. Government, and part of EPA's responsibility under that
    strategy is to look at the methane that is being emitted from
    landfills in context of our Clean Air Act obligations. It is
    also looking at coal mines. It is also looking at
    unconventional oil and gas development and how we can continue
    to work together as we have before to take advantage of new
    technologies that make the capture of that methane more
    effective.
        Mr. McNerney. Are these new technologies cost effective for
    the industry?
        Ms. McCarthy. Well, we have already issued a New Source
    Performance Standard that captures the volatile organic
    compounds in the emissions from unconventional gas when
    hydrofracking happens. Part of that captures the methane as
    well. It is very cost effective. In fact, it is one of the few
    rules that EPA has done at least in my tenure that makes the
    obligated parties money.
        Mr. McNerney. Good.
        Ms. McCarthy. It doesn't take it away because you can
    certainly reuse the methane and sell it.
        Mr. McNerney. Sure. As you know, we have conducted five
    hearings on the Toxic Substance Control Act. In one hearing,
    every single witness agreed the decisions on chemical priority
    should be based on human health safety, every single witness,
    11 total. In your opinion, does the discussion draft, Chemicals
    in Commerce, put human health safety first or are other
    considerations given higher prominence?
        Ms. McCarthy. Congressman, EPA hasn't done a complete
    assessment of any of the rules so far, but we are providing
    technical assistance to both the Senate and Congress on this
    issue. We will continue to do that, and we certainly have
    issued principles that put public health first and we would be
    evaluating consistent with those principles.
        Mr. McNerney. Well, it is important that the EPA have the
    authority in my opinion to evaluate chemicals. Would you agree
    that providing EPA with the necessary information of a chemical
    be mandatory before allowing it to enter commerce?
        Ms. McCarthy. That is the law now, and I believe that it
    should remain the law, yes.
        Mr. McNerney. Very good. How can Congress best ensure that
    the EPA is provided with the resources it needs to test and
    classify these chemicals?
        Ms. McCarthy. Well, we are requesting continued assistance
    under the current TSCA rule. We are also looking at developing
    new tools as I indicated before to prioritize. We need
    resources to be able to do that. And we are encouraged that
    Congress is looking at TSCA with some seriousness, but we
    certainly know that there is a long way to go before we can
    rely on a new rule and we have work to do in the meantime and
    we will keep doing it.
        Mr. McNerney. Thank you. Mr. Chairman, I yield back.
        Mr. Whitfield. The gentleman's time has expired. At this
    time, I recognize the gentleman from Nebraska, Mr. Terry, for 5
    minutes.
        Mr. Terry. Thank you, Mr. Chairman, and coming from
    Nebraska I may have a little bit of an ag angle. So the first
    question is I read with interest over the weekend a new
    proposed dairy rule regarding dairy operations and methane. And
    I was just wondering if, in the proposed methane, to reduce
    methane emissions by 25 percent by 2020. You have a look like
    you don't know that, but it was an article that was in Friday
    and Saturday's papers.
        Ms. McCarthy. What kind of rule is it? I am sorry. I did
    look a little befuddled.
        Mr. Terry. Yes.
        Ms. McCarthy. I apologize. Everything I think comes out my
    face. I look a little----
        Mr. Terry. I share the same trait.
        Ms. McCarthy. I looked befuddled because thankfully, you
    are not referring to anything that EPA has proposed. I do know
    that as part of the methane strategy, the USDA has identified a
    number of ways in which they think they can work with the dairy
    industry. We have been working with them all along on----
        Mr. Terry. Yes, the article----
        Ms. McCarthy [continuing]. Methane digesters----
        Mr. Terry [continuing]. Said EPA was involved.
        Ms. McCarthy. Only to the extent that we work on a
    voluntary program, not a regulation, to work with the farming
    community and agriculture, particularly dairy, where there are
    opportunities to have methane digesters so that you can
    recapture the methane, and they tend to use it for electricity
    generation on site.
        Mr. Terry. Yes, and I have seen some----
        Ms. McCarthy. And that is entirely, not a rule-making.
        Mr. Terry. OK. And there is just a couple of concerns with
    that that I will lay out, so as part of that one of the
    concerns deals with the smaller dairy operations because the
    digester, they are very expensive. And so the feedback that I
    received over the weekend and on Monday was that if you are a
    dairy operation of about 300 head, then you can't meet that. So
    I just wanted to put on the table that requiring--because
    mostly when farmers hear voluntary, they know it is followed up
    with mandatory. That is their----
        Ms. McCarthy. Well----
        Mr. Terry. You may be able to come up with instances it is
    not but----
        Ms. McCarthy. I know I should never speak for one of my
    colleagues on the Cabinet, but I think I can safely speak for
    Secretary Vilsack that he is really talking about a
    collaborative process to take a look at how we can assist the
    dairy industry in this venture. No one at this point that I
    know of is talking about anything in a regulatory context.
        Mr. Terry. I hope not. I appreciate that but----
        Ms. McCarthy. Me, too.
        Mr. Terry [continuing]. That is something I would resist.
    In that regard then also one of the other issues that is
    brought up a lot is the groundwater, and there is some proposed
    rule that is viewed in our ag industry and by me as another way
    to get at water runoff. There is a list of 50 rules that they
    can use to comply, and again, it is voluntary as I understand.
        Ms. McCarthy. Let----
        Mr. Terry. Explain that, how that works----
        Ms. McCarthy [continuing]. Me just quickly----
        Mr. Terry [continuing]. Because it sounds like a backwards
    way----
        Ms. McCarthy. No
        Mr. Terry [continuing]. Of just trying to get around two
    previous Supreme Court decisions to----
        Ms. McCarthy. No, it is actually trying to implement them.
    It is called the Waters of the United States, and we can spend
    some time on this if you would like----
        Mr. Terry. All right.
        Ms. McCarthy [continuing]. And I would be happy to talk to
    your community on this. But I think we did a pretty good job.
    Number one, we made it very clear it does not regulate ground
    water. That is not its business. It is clearly stated. For the
    reason why, the same reasons you are raising it is to address
    those concerns. And the 50 practices are actually agricultural
    practices that we are defining as exempt from the jurisdiction
    from the Waters of the United States.
        Mr. Terry. Right.
        Ms. McCarthy. And we are inviting a process for more of
    those to be identified. So we are doing the best we can to
    identify and to provide more certainty while allowing farmers
    to do the work they need to do for all of us.
        Mr. Terry. Yes, they would disagree with the certainty of
    what they have to do now. The other part is last week in a
    hearing there was a question about whether or not the
    agricultural exemptions apply to Section 404 or 402. Have you
    been able to clarify that for us as well?
        Ms. McCarthy. Yes, 404 only.
        Mr. Terry. 404 only?
        Ms. McCarthy. Yes.
        Mr. Terry. Very good. Last, this is a little snarky but it
    comes up a lot.
        Ms. McCarthy. OK.
        Mr. Terry. What is the budget to rent for planes, to fly
    over feed lots in Nebraska?
        Ms. McCarthy. First of all, we don't do drones, so the
    budget for that is zero. We do use flyovers at times to
    basically as a screening mechanism. I do not know what those
    budgets are, sir.
        Mr. Terry. All right. Thank you. I yield back my 4 seconds.
        Mr. Whitfield. The gentleman yields back. This time I will
    recognize the gentlelady from California, Ms. Capps, for 5
    minutes.
        Mrs. Capps. Thank you, Mr. Chairman, and Administrator
    McCarthy, thank you for your testimony and for being here
    today. I have a couple topics for sure I would like to get on
    the table, and the first one is off-shore fracking.
        Ms. McCarthy. Yes.
        Mrs. Capps. As you know, numerous fracks have taken place
    from off-shore platforms in Federal waters off the coast of
    California in recent years. Many of these fracks have been in
    the sensitive waters of the Santa Barbara Channel which is in
    my congressional district.
        While we know very little about the impacts of on-shore
    fracking, we really know far less about off-shore. And that is
    why I called on the EPA and the Department of the Interior last
    November to place a moratorium on these off-shore activities
    until a comprehensive environmental review is conducted and
    considered.
        I know EPA included new disclosure requirements in its most
    recent discharge permit for these off-shore platforms, and I
    commend you for taking this important step. But this is the
    catch right now. Much more is needed, and under this new
    general permit, operators only need to report the type and
    amount of chemicals in their wastewater after it has already
    been discharged into the ocean. As a result, regulators like
    EPA and the California Coastal Commission cannot review these
    discharges on a case-by-case basis in anticipation of the
    fracking happening, rather than after the fact.
        So Administrator McCarthy, would you consider modifying
    this discharge permit to require a case-by-case review of these
    fracking discharges?
        Ms. McCarthy. Well, the general permit that we issued under
    the law allows us to reconsider that and take a look at new
    data. We are more than happy to work with you. We think that
    the general permit that we put out was a sensible approach,
    given the authority that we have under the law. It also
    requires that the certain standards that are achieved in this
    effluent that is emitted that may contain hydrofracking, that
    that is appropriately tested to ensure that it doesn't damage
    aquatic life. But if you have concerns, we are always available
    to sit down and talk through those, and if changes are
    necessary, the law allows changes to be made.
        Mrs. Capps. Great. And I do look forward to that. I think
    such a modification would be important and look forward to
    continued discussion on that topic.
        Here is another topic. Climate change, as you know, is
    already having serious impacts on our environment, on our
    infrastructure and on our public health. Representing a coastal
    district as I do, I am particularly concerned by one of climate
    change's lesser understood impacts, ocean acidification.
        Ms. McCarthy. Yes.
        Mrs. Capps. The coastal communities in my district depend
    on healthy oceans and coastal ecosystems for their livelihoods,
    for recreation and much more. So changing ocean chemistry,
    particularly in the coastal zone where much of this economic
    activity takes place, has a direct impact on my constituents.
        The just-released IPCC, Intergovernmental Panel on Climate
    Change, report on climate change highlighted several factors,
    including runoff and other pollutions, that are magnifying the
    impacts of ocean acidification at the local level.
        What is EPA doing to identify coastal areas that are of
    particular risk for ocean acidification, and if you can, tell
    us what is being done or can be done to help make these
    communities more resilient going forward?
        Ms. McCarthy. Yes. Yes, I think one of the most important
    messages from the recent IPCC, other than the increasing
    certainty around the science, it was the highlighting of ocean
    acidification as a clear concern. And we have, across the U.S.
    Government, a number of agencies who are on point to look at
    that issue, most notably NOAA, who has expertise and others,
    and we are working across the Federal Government at
    understanding the science and its implications.
        On the resiliency side, every agency has developed an
    adaptation plan. We also have a Resiliency Task Force that is
    looking at this from a national level. We need to make sure
    that our communities at risk understand that risk, are prepared
    to act when risk happens and that also we are looking at the
    designs that we can put into our infrastructure that prevent
    water from creating the same kind of concerns that we have seen
    in the past. So we are working to mitigate carbon emissions. We
    are looking at also addressing, hand in hand with communities,
    how we can keep them safe in the face of a changing climate.
        Mrs. Capps. Do you see pieces of the President's budget
    allowing for this? And also--you are nodding so I will take
    that as an answer----
        Ms. McCarthy. Yes.
        Mrs. Capps [continuing]. But also say to our chairman in
    conclusion that a hearing on climate change adaptation and
    resiliency or an aspect of that I think would be most
    appropriate for this committee because these Federal agencies,
    as the Administrator just said, are going ahead and working on
    it. I think we need to be apprised, but also there might be a
    role that we would want to play working with you. And I yield
    back the balance of my time.
        Mr. Whitfield. The gentlelady yields back. Thank you. At
    this time I recognize Dr. Cassidy from Louisiana for 5 minutes.
        Mr. Cassidy. Welcome, Administrator.
        Ms. McCarthy. Hello.
        Mr. Cassidy. I am from Louisiana, so as you might guess I
    am interested in the export of liquefied natural gas. Sempra
    has a plant that they are seeking approval for to build but
    need clearances. A Reuter's article yesterday spoke about how
    EPA had issued something to FERC asking them to consider
    whether approving LNG export would increase methane release,
    carbon footprint, if you will, by increasing the demand for
    more natural gas drilling.
        Now this interests me in a couple ways. One, I think it
    reflects we know that natural gas is replacing coal which has a
    better carbon footprint than coal. Now, if EPA is objecting
    that there would be more gas released in the Haynesville shale
    of Louisiana, so therefore we shouldn't do it, in my reading it
    seems to reflect a limited understanding of the positive
    impacts that it has, not just on our U.S. economy creating jobs
    for those who do not have but also on the world economy and
    frankly on the carbon footprint of the world economy. Any
    thoughts on that? I mean, why would EPA be weighing in on this?
        Ms. McCarthy. Congressman, actually EPA did not oppose any
    objection, and we didn't recommend that this needed to be done
    in any way. It was part of the normal environmental process in
    which we identify all impacts. And so we were not weighing in
    relative to whether this was good, bad or indifferent related
    to any other----
        Mr. Cassidy. Now, the first paragraph--so maybe I have a
    misunderstanding of the Reuter's article. The U.S.
    environmental regulator raised concerns that a Federal review
    of Sempra's Energy liquefied natural gas export project did not
    include an assessment of potential effects of more natural gas
    drilling. It goes on to say that, you know, increased natural
    gas extraction would potentially increase carbon footprint.
        So even though the article is kind of written to construct
    that you were opposing if you will----
        Ms. McCarthy. No, we raise this type of--it is just raising
    that these are part of the things that you might think about.
    We did not recommend it. We did not make an argument for it,
    and it is something that we raise in many of our environmental
    assessment reviews.
        Mr. Cassidy. OK.
        Ms. McCarthy. I think they might have put it in a much
    stronger context and clearly did than EPA raised it.
        Mr. Cassidy. Then let me ask you this. I visit the Petra
    chemical plants in South Louisiana which made gasoline, for
    example, for Northeast United States.
        Ms. McCarthy. Yes.
        Mr. Cassidy. And they pose an interesting question. EPA has
    demanded that sulfur be extracted from oil, but it takes
    natural gas to do so and it raises the carbon footprint of the
    facility to--the process of extracting the sulfur raises the
    carbon footprint of the community or of the facility. And they
    really feel like they are getting caught both ways. On the one
    hand, they have to extract the sulfur, but on the other hand,
    you increase your carbon footprint. Again, your thoughts on
    that?
        Ms. McCarthy. Well, actually, if you take a look at the
    rule that we did which is called Tier 3, it looks at and
    recognizes these tradeoffs, but it also recognizes that the
    low-sulfur fuel provides an opportunity for tremendous
    greenhouse gas reductions in vehicles because it opens up
    opportunities for better catalytic converters, better engine
    technologies.
        Mr. Cassidy. I totally get that. So my understanding----
        Ms. McCarthy. So on the whole, right now, I think we
    understand that the refineries have weighed in on this issue.
    We have considered it. It is in the assessment, and I think we
    have appropriately addressed it. And no refinery right now is
    being----
        Mr. Cassidy. Tasked?
        Ms. McCarthy [continuing]. Tasked with taking a look at
    this issue individually.
        Mr. Cassidy. Now, let me ask you because also, and again, I
    don't know, I am asking.
        Ms. McCarthy. Yes.
        Mr. Cassidy. Sometimes they have to get a permit from one
    of your regional offices in order to expand capacity. But
    again, if they are having to raise their carbon footprint----
        Ms. McCarthy. No.
        Mr. Cassidy [continuing]. In order to lower sulfur, is this
    taking into account the kind of whole system approach? Well,
    wait a second. Yes, you have done that. You have lowered the
    carbon footprint of vehicles, so therefore we will allow you a
    higher carbon footprint at the facility. Is that what is being
    said?
        Ms. McCarthy. Well, the good news is I think, Congressman,
    that in our assessment in working with the refineries
    themselves, the facilities don't need to make large capital
    investments and----
        Mr. Cassidy. But I have been told at least locally----
        Ms. McCarthy. If they do for pollution control equipment,
    there are appropriate exemptions for that, and we work through
    them.
        Mr. Cassidy. At least in times past there have been
    limitations on the expansion of some of the facilities in my
    district because of concern over greenhouse gas emission. And
    so again, my concern is that one set of restrictions is setting
    them up to be denied the ability to expand.
        Ms. McCarthy. I am happy to work with you on it if there is
    an instance where this is coming up.
        Mr. Cassidy. OK.
        Ms. McCarthy. I am not aware of it, but we will work
    through it.
        Mr. Cassidy. Thank you, Ms. McCarthy.
        Ms. McCarthy. Thanks.
        Mr. Whitfield. At this time I would like to recognize Dr.
    Christensen from the Virgin Islands.
        Mrs. Christensen. Thank you, Chairman Whitfield. Good
    morning, Administrator McCarthy and welcome.
        Ms. McCarthy. Good morning.
        Mrs. Christensen. You know, I appreciate the efforts being
    made to streamline the Agency and to meet your missions, yet
    that mission of protecting the public health and the
    environment. But there are many in the House and on this
    committee who would rather just starve EPA to death, and
    considering that your budget is lower as I understand it than
    the 2003 enacted budget just seems to help that process.
        Back home in St. Croix in my district in the USVI, one of
    my high schools is closed after noxious fumes sickened children
    and teachers, and individuals were sent to hospital, and that
    was the third time in a month. EPA has responded, and we thank
    you for that. But we need to know that you will be able to
    respond if this happens again this year, next year or the year
    after and that you would be able to help us with providing
    monitoring that would be long-term monitoring because that is
    not the first time this has happened either at this school or
    in the surrounding communities.
        The budget with the decreases don't give me that assurance.
    In your testimony you say that the budget furthers
    environmental justice efforts, and we are glad to hear that
    you, too, and you partner with the States and the tribes and I
    am assuming--I shouldn't assume. I hope that includes the
    territories.
        But many districts like mine are struggling with economic
    downturns and budget deficits. So we don't have much to
    contribute. How successful do you think EPA can be in
    furthering its commitment to environmental justice and other
    priority goals given that many States and territories just
    don't have the resources?
        Ms. McCarthy. Well, I think the good news in this budget is
    that we have increased our request for these categorical
    grants, the STAG grants that go to our States, and certainly it
    will impact your community as well. But we also are really
    focusing on prioritizing our efforts in a couple of different
    ways. One is the issue of environmental justice, and it is
    important for us to recognize because these are challenges that
    are not only a fairness question but they point to areas where
    our intervention would be most beneficial from a public health
    perspective. So we are working very hard to get the tools and
    the policies in place that help us prioritize and direct our
    efforts in that way.
        But part of the challenge here is we have to recognize
    budget realities, and we are trying to do that. But at the same
    time we are trying to take advantage of new technologies and
    practices so that we can have our people available to answer
    when schools call and not be at every facility measuring the
    stack. There are new technologies that can help us remotely
    monitor. We have an E-Enterprise system that is going to get us
    out of paperwork and into this century to do electronic data
    exchanges and to have that data publically available.
        This is a whole new way that we are trying to shift our
    ability of our Agency to understand the value of new
    technologies and how they can change the way we do business so
    that human beings see human beings when they need to.
        Mrs. Christensen. Well, thank you. I am somewhat reassured
    by your response, and I hope that at the very least, you get
    all of the budget that you are asking for. But I would have
    preferred----
        Ms. McCarthy. I know.
        Mrs. Christensen [continuing]. To see some more. Another
    area, a proposed cut that is most troubling is the defunding of
    the Beaches Protection categorical grants and the implications
    of this are coastal economy and public health. We rely on our
    beaches and oceans as a source of recreation but also as a
    major economic driver. In 2011 alone there were 23,481 beach
    closures and advisories issued in this country, and if we stop
    conducting beach sampling, it will be impossible for us to know
    of pollution problems, and as a result we won't be able to
    address them. And cutting these important funds could mean
    fewer tests for bacterial levels and fewer people informed when
    the water is unhealthy.
        In my district close to 3 million visitors come to our
    shore by air and cruise, and about that number came in 2013.
    And that is a lot of people to be affected, and this doesn't
    even factor in the residents who depend on these resources the
    most.
        So Administrator, there have been some discussions that
    State-level organizations are expected to begin to take on
    these efforts. Has EPA done any analysis of how defunding the
    beaches program will affect States and territories and do we
    know if localities are prepared to assume this important
    responsibility?
        Ms. McCarthy. Yes, I am more than happy to provide you with
    additional background on that. We have three program
    eliminations in this budget that total $37 million. One is our
    radon grants to States. The second is the Beach Monitoring
    Program, and the third is the DERA fund, our Diesel Emission
    Reduction fund. And you know, these are difficult choices for
    me, and I know that they will be. At least the thinking behind
    the Beaches Monitoring Program is that there is a level of
    expertise and technology that has been built up in States that
    can allow this transition to happen. It also is in the context
    of a $76 million increase in categorical grants on the whole to
    States that we hope will be prioritized by those States
    effectively.
        But I understand that there are concerns raised on these
    issues, and I will certainly wait to hear from Congress in
    terms of their understanding of these and whether or not this
    is the appropriate way to do our budget.
        Mrs. Christensen. Thank you. Thank you, and I yield back.
        Mr. Whitfield. At this time I recognize the gentleman from
    Louisiana, Mr. Scalise, for 5 minutes.
        Mr. Scalise. Thank you, Mr. Chairman. I appreciate you
    having this hearing, and Ms. McCarthy, Administrator McCarthy,
    I appreciate you being here with us to talk about the budget
    and obviously the impacts that that budget will have.
        When I look at your budget, it seems EPA spent a
    significant portion of that budget on rule-making activities.
    In your testimony you say that EPA will focus resources on
    developing achievable greenhouse gas standards for power
    plants.
        Now, when I look at the track record that EPA has had on
    the rule-making and especially on projections on the kind of
    impacts those rules would have, it raises some serious
    questions. I want to ask you, in 2012, EPA said that its
    utility MACT rule would not result in significant plant
    shutdowns. On February 8 of 2012, you testified that EPA's
    analysis showed that only 4.7 gigawatts of capacity would be
    retired as a result of utility MACT when in fact I think you
    further said that removal of this capacity ``will not adversely
    affect capacity reserve margins in any region of the country.''
        And so when you look at the reality of utility MACT, it is
    responsible for hundreds of coal plants being shut down
    nationwide. In fact, a group has estimated that nearly 51
    gigawatts, or about 330 coal units in 30 different States, have
    been shut down or converted into a different fuel because of
    the EPA's rule. So when you projected in 2012 4.7 gigawatts
    would be retired, in fact, the numbers show it is closer to 51
    gigawatts. In fact, the U.S. Department of Energy estimates
    that approximately 54 gigawatts of coal-fired capacity will
    retire by 2016.
        So when you look at this track record, as you all make
    rules, it seems your predictions of what will happen are so far
    off and to the detriment of American consumers. When these coal
    plants are being shut down, people are paying more for their
    electricity because of the results of your actions. So you are
    out there making all these rules. You are making all these
    projections of what these rules will do and the impacts have,
    and it seems that you are so far off. So can you explain EPA's
    failure to accurately assess the real-world implications,
    especially as it relates to utility MACT?
        Ms. McCarthy. I am happy to talk about this. The numbers
    that you are quoting are numbers of closures that result both
    from the increased inexpensive natural gas, the inability for
    coal in many areas to compete and consumers wanting to spend
    less money for their electricity, much more than it is
    accountable to one particular rule, in this instance.
        Mr. Scalise. So you are saying that these coal plants that
    are being shut down aren't because of your rules?
        Ms. McCarthy. That is correct. The vast majority----
        Mr. Scalise. That is what they are saying, if you are
    listening to what people are saying in the real world.
        Ms. McCarthy. That is what I am saying, is that what we
    estimated was the incremental impact from MACT, we did not say
    that there wasn't a transformation in the energy world----
        Mr. Scalise. I mean, President Obama himself said----
        Ms. McCarthy [continuing]. Wouldn't change.
        Mr. Scalise [continuing]. That he wants to bankrupt coal.
    It is not like there is some secret out there.
        Ms. McCarthy. Who said that?
        Mr. Scalise. President Obama when he was running for
    president. He talked about, you know, utility costs
    skyrocketing----
        Ms. McCarthy. I think the President has been clear in an
    all-of-the-above strategy, and that includes----
        Mr. Scalise. All of the above? He is against everything
    below, it seems in his strategies. When you look at what is
    happening with coal, I mean, I hope you are not trying to say
    there is not a war on coal? I mean, there is clearly a war on
    coal.
        Let me read you a quote from Barack Obama. I mean, you are
    putting words in his mouth. The problem is he said things very
    different, and he is pushing things very differently. In fact,
    you are carrying things out differently than what is being
    purported. The President said, ``So if somebody wants to build
    a coal plant, they can. It is just that it will bankrupt them
    because they are going to be charged a huge sum for all that
    greenhouse gas that is being admitted.'' That is was Barack
    Obama in 2008 when he was running for president. He said, ``It
    is just that it will bankrupt them'' to build a coal plant.
        So clearly, he has had this agenda for a long time, whether
    you recognize it or not.
        Ms. McCarthy. Mr. Scalise, the Mercury and Air Toxics
    Standard is a standard on toxic emissions like mercury and
    arsenic. It has nothing to do----
        Mr. Scalise. Well, let me ask you this----
        Ms. McCarthy [continuing]. With greenhouse gas----
        Mr. Scalise [continuing]. Because we are talking about
    greenhouse gas emissions and you know, it used to be called
    global warming.
        Ms. McCarthy. Yes.
        Mr. Scalise. And then all of a sudden we had the worst
    freeze ever. I mean, it was so cold a couple of weeks ago the
    polar bear could not go outside in Chicago because it was so
    cold. So now the term is no longer global warming, it is
    climate change.
        You got Secretary of State John Kerry, climate change is as
    big a threat as terrorism, the Secretary of State saying
    climate change is as big a threat as terrorism. We are running
    coal out of this country, coal jobs, the coal itself. It is
    going to foreign countries, by the way, that emit more carbon
    than we do here in America today without all of your standards
    that you are trying to change that are killing jobs, jacking up
    people's electricity rates. The impacts are so devastating.
        So do you at least acknowledge that if that coal that used
    to be burned here to provide fuel is being shipped to another
    country, and in many cases they are emitting four or five times
    the amount of carbon in those other countries, do you have a
    concern about the impact on the climate when those policies are
    actually resulting in even more carbon being admitted into the
    atmosphere when you run those jobs to other countries?
        Ms. McCarthy. I have two concerns. One is the concern to do
    what I can within the authority of the law that is technically
    available to reduce carbon pollution in the United States, and
    I have a concern that that provide the United States an
    opportunity to leverage additional reductions internationally
    so we can have a comprehensive, global strategy to address what
    I believe is----
        Mr. Scalise. So what is happening in the real world, you
    are not concerned that it is devastating our economy and it is
    actually increasing the amount of carbon emitted in the
    atmosphere because those other countries emit even more than is
    done here.
        Mr. Whitfield. The gentleman's time----
        Mr. Scalise. Well, it is the real world. I yield back----
        Mr. Whitfield. The gentleman's time is expired.
        Mr. Scalise [continuing]. The balance of my time.
        Mr. Whitfield. At this time I recognize the gentleman from
    Ohio, Mr. Latta, for 5 minutes.
        Mr. Latta. Thank you very much, Mr. Chairman, and
    Administrator, thanks very much for being with us today. I
    really appreciate you being here to answer questions today.
        And I know some of the members on this committee have heard
    me say this before, but I always like to talk about what my
    district looks like and the concerns that we have back home.
        I represent 60,000 manufacturing jobs. Interesting enough,
    I also represent the largest agricultural district for the
    State of Ohio. And when I go out and literally meet with the
    hundreds of businesses that I have seen and talked with over
    the last couple of years that the number one issue that I
    always hear from my businesses out there is on regulations.
    That is the top question, problem, they run into.
        But when I ask them, OK, what regulations are you always
    talking about, it always comes down to the EPA are the toughest
    things for them to have to try to comply with. And so as we are
    talking about those issues out there, one of the things of
    course that comes up, we want to have people expanding their
    businesses and employing more people. And the question then is
    would you agree that it is more difficult for these businesses
    that I have and across the Nation like this to build new
    factories or manufacturing facilities in areas that don't meet
    the national Ambient Air Quality Standards?
        Ms. McCarthy. There are different requirements. Whether it
    is more difficult or not I can't answer, sir.
        Mr. Latta. Well, let me go on because--for example, it is
    easier to build a factory in an area that meets those existing
    ozone standards than the nonattainment area, and you know,
    especially when I look around Ohio, one of the interesting
    things is you can be in one county and be out of attainment and
    literally put a factory across that next county line and be in
    attainment. Now, I don't want to say that I want to see that
    county that was able to get that factory to say, well, let us
    put them out of attainment. But these are the things that, you
    know, these businesses are facing out there, and I want to also
    make sure that we can get the folks out there to employ more
    people.
        And is the EPA currently considering lowering the existing
    ozone standards?
        Ms. McCarthy. We are currently in the process of doing the
    5-year review that is required under the Clean Air Act, and it
    is now being currently considered by the Clean Air Science
    Advisory Committee.
        Mr. Latta. OK, and if the EPA does lower the standards,
    will that expand the number of areas in the country that are
    going to go into nonattainment?
        Ms. McCarthy. Sir, we will have to take a look at what the
    Clean Air Science Advisory Committee says and what the data
    says, and we will see what the decision of the Administrator
    has.
        Mr. Latta. OK, so if we see more going in there, so we are
    going to have it that more areas in the country, it is going to
    be much more difficult to build more factories that are going
    to employ more people if these standards are lowered. Is that
    correct?
        Ms. McCarthy. I can't answer the question because there
    would be different standards that are required, but I do not
    know whether it would be more difficult for an industry to
    develop there as opposed to a place that is in attainment.
        Mr. Latta. OK. And even though, you know, in the State of
    Ohio, we have been very fortunate with the Utica shale being
    developed in the eastern part of the State, Ohio is still 78
    percent coal-based in our electric generation. In 2010, the EPA
    proposed ozone standards that were subsequently withdrawn at
    the President's direction, but that would have placed 77 to 96
    percent of the counties in the United States with ozone
    monitors in nonattainment. Is the EPA currently considering the
    same potential revisions to our ozone standards from that 77-
    to 96-percent level? Did you understand the question?
        Ms. McCarthy. I am sorry. I didn't exactly understand the
    question.
        Mr. Latta. OK. Back in 2010----
        Ms. McCarthy. Yes.
        Mr. Latta [continuing]. These were withdrawn, but at that
    time, under the President's direction, they would have placed
    77 to 96 percent of the counties in the United States with
    ozone monitors----
        Ms. McCarthy. Oh, I see.
        Mr. Latta [continuing]. And nonattainment.
        Ms. McCarthy. I see. This is what I do know, is that the
    policy assessment in the Clean Air Science Advisory Committee
    is looking at ranges that are not dissimilar to what the
    reconsidered proposal was looking at, and I do not know what
    that would translate into in terms of nonattainment areas
    because that is always based on the last 3 years of certified
    data. So I can't exactly say, but it is a similar review that
    is going on now to what we looked at during the re-proposal.
        Mr. Latta. OK. Well, let me just follow up then because do
    you then think that that would be acceptable to adopt those
    revised ozone standards that would put let us just say 96
    percent of the counties with ozone monitors in nonattainment,
    or at 77 percent?
        Ms. McCarthy. It is not acceptable or unacceptable, sir. I
    wouldn't be making a decision on the basis of the science
    related to what the protective standard needs to be under the
    law.
        Mr. Latta. Mr. Chairman, I see my time has expired, and I
    yield back.
        Mr. Whitfield. The gentleman yields back. At this time I
    recognize the gentleman from New York, Mr. Engel, for 5
    minutes.
        Mr. Engel. Thank you very much, Mr. Chairman, and welcome,
    Administrator McCarthy.
        Ms. McCarthy. Thank you
        Mr. Engel. Thank you for the good job you are doing, Ms.
    Froehlich, as well. I have three issues. I am going to see if I
    can talk fast and get them all in, but one is about fracking in
    my home State of New York----
        Ms. McCarthy. Yes.
        Mr. Engel [continuing]. And Upstate New York. It is a big
    point of contention. Some say it will create lots of jobs.
    Others are worried about the safety of it. Some argue that the
    EPA's real goal is to prevent or slow natural gas development
    in the United States. Some say that additional studies aren't
    necessary given industry's long track record of using this
    technology. So how do you respond to those things and how will
    the hydraulic fracking study help achieve, you know, the
    objective that it is supposed to achieve?
        Ms. McCarthy. Well, the President I think has made it clear
    that the process of fracking has really opened up opportunities
    for clean, natural gas, but it has to be done safe and
    responsibly. And what EPA is doing right now is the research it
    needs to do to understand what the potential impacts are to
    ground water as well as looking at what technologies are
    available to support the recapture of methane so that we are
    addressing that as an intensive climate-warming compound. And
    we will keep working through these issues. But we are trying to
    establish the science foundation that we can share with the
    outside community to ensure that natural gas is done safe and
    responsibly.
        Mr. Engel. Thank you. I have a very parochial issue
    involving my district. It is the Hillview Reservoir, and in
    accord with Federal Long-Term 2 Surface Water Treatment Rule,
    the EPA sought to have New York City----
        Ms. McCarthy. Yes.
        Mr. Engel [continuing]. Build a concrete cover over the
    Hillview Reservoir in Yonkers. My district goes from New York
    City through Yonkers. That reservoir is in my district. I was
    one of several members of the New York delegation that wrote to
    Administrator Lisa Jackson urging a waiver of the regulation as
    it applies to Hillview, and EPA subsequently agreed to initiate
    a review process for the regulation requiring covers on
    reservoirs such as Hillview.
        So I am wondering if you could please provide me with an
    update or at least get back to me on the status of that review
    process?
        Ms. McCarthy. I do know that this issue has come up to
    everybody's attention that Region 2 is working with New York
    City on it, but I will provide you an update on how the rule is
    being looked at.
        Mr. Engel. There are just some mandates that just don't
    make sense that are--
        Ms. McCarthy. Yes.
        Mr. Engel. --costly, and the benefits are very, very minor
    compared to what the cost is.
        Ms. McCarthy. We are just trying to get at the public
    health impacts, and if there is a better way to do that, we
    will be wide open to it.
        Mr. Engel. All right. Thank you. And my last one is about
    revolving funds. States are able to provide low-cost financing
    for a wide range of water quality infrastructure projects
    through the Clean Water, and Drinking Water State Revolving
    Funds in New York has received lots of money through the years
    to protect our watersheds and make upgrades and repairs to our
    sewer systems. I certainly support all of that.
        But despite these investments, EPA's most recent drinking
    water infrastructure needs survey indicates that New York will
    require approximately $29 billion over 20 years to ensure
    continued delivery of safe public drinking water. New York has
    aging sewer and water systems. They are in desperate need of
    repair and upgrade or they will pose significant environmental
    and public health problems. So I think that is important. It
    also represents an economic opportunity because we can put
    several thousands in New Yorkers back to work over the next
    several years helping to do that. But when we look at the
    President's fiscal year 2015 budget, it proposes a $580 million
    reduction to the State Revolving Funds from this year, and I
    think that is not obviously very good. So I want to just say
    that.
        And I want to also ask you setting aside environmental and
    public health issues, please explain the economic and jobs
    benefits of investing in water infrastructure, and tell me how
    these cuts to the State Revolving Funds would impact these
    benefits.
        Ms. McCarthy. Yes. We have had to make some difficult
    choices. Clearly the State Revolving Fund is important for
    public health as well as for jobs. I mean, clearly it keeps
    people employed. It prevents major illnesses from occurring. It
    helps protect our rivers and streams and natural places. So it
    is extremely important.
        But the choices we needed to make are ones that I know that
    you will consider strongly. But we had to look at how we have
    been capitalizing this fund, what opportunities there are for
    the revolving fund payments to be in the system and also
    supporting this effort and also recognize that this
    administration over the past 5 years has already invested $20.7
    billion in SRF. That compares to 8 years of history in the
    prior administration were $17.2 billion has been invested.
        Now, that doesn't mean that me, individually, wouldn't like
    to see lots more money to this effort for public health
    purposes and certainly because of the economic growth. But
    there are difficult decisions to be made. We did the best we
    could, and we will certainly listen to what Congress says.
        Mr. Engel. Thank you very much. Thank you, Mr. Chairman.
        Mr. Whitfield. Thank you. At this time I recognize the
    gentleman from Texas, Mr. Olson, for 5 minutes.
        Mr. Olson. I thank the chair, and Ms. McCarthy, I would
    like to keep the conversation going that my colleague from
    Ohio, Mr. Latta, had about NAAQS, National Ambient Air Quality
    Standards and ozone. America has come a long way in improving
    air quality, but counties nationwide are hitting the limits of
    what they can do. VOC offsets are now $238,000 per ton in my
    home State of Texas, and that is if they can get the offsets.
    Without offsets, new factories, new power plants and almost
    anything new that creates jobs becomes impossible. If you stop
    cutting the fat, you are cutting to the bone. And EPA's rules
    are getting tougher. EPA recently pushed the particulate
    standard lower. Ozone is next. EPA is headed to court next week
    to settle with the environmental activists on a new ozone rule.
    It should be out by December.
        EPA is looking to lower the ozone standard from 75 parts
    per billion to as low as 60 parts per billion. A few years ago,
    your cost estimate, yours, for doing that was $90 billion per
    year, almost $1 trillion over 10 years. That is a killer for
    the economy.
        Please pull up the slide for me, my friends.
        [The information follows:]
        [GRAPHIC] [TIFF OMITTED] T0780.006

        Mr. Olson. Here it comes. This slide shows the few counties
    that meet the 60 billion parts-per-billion rule. Only five
    national parks would be in attainment at 60 parts per billion.
    Even at 65 parts per billion, this will likely be the most
    expensive rule in American history.
        We can only cut emissions so far. Natural sources, like
    forest fires and lightning, create these pollutants. We have
    foreign sources, too. Next slide, please.
        [The information follows:]
        [GRAPHIC] [TIFF OMITTED] T0780.007

        Mr. Olson. The New York Times declared, ``A New East Asian
    Import: Ozone.'' This slide shows the tsunami of Chinese ozone
    swarming over our West Coast. Chinese pollution puts our homes
    out of compliance, even under the current caps. On top of all
    this, we still have to grow our economy. Communities can't
    create new jobs if they can't expand. In homage to Chairman
    Emeritus Dingell, I have some yes-or-no questions.
        Will you commit to include in any NAAQS standards a
    proposal to keep the current standard? Yes or no.
        Ms. McCarthy. I cannot make that commitment, sir.
        Mr. Olson. No commitment? OK. Is EPA allowed to consider
    economic costs in setting new NAAQS? Yes or no.
        Ms. McCarthy. That answer is no.
        Mr. Olson. No? Will EPA consider job losses? Yes or no.
        Ms. McCarthy. We will assess them.
        Mr. Olson. OK, and will EPA consider feasibility, economic
    feasibility?
        Ms. McCarthy. In the establishment of the standard? No,
    sir.
        Mr. Olson. Will you do this before December? Yes or no. New
    standards before December?
        Ms. McCarthy. I do not know, sir, because I don't know the
    results of the court case.
        Mr. Olson. OK. If I can just move on, ma'am, I am running
    out of time here. But we can't shut down the economy or energy
    production. We can't end natural and foreign pollution, and we
    all know it is impossible to have zero smog and zero
    particulate matter. So very briefly, does EPA have a way of
    striking the balance between air quality and achievability?
        Ms. McCarthy. The Clean Air Act does not ask States to
    reduce background levels.
        Mr. Olson. OK. I want to follow up on a comment. You
    touched on this issue with my colleague from California about
    exceptional events, to get any relief from penalties if
    pollution is outside of their control. Of the 10 exceptional
    events waiver requests, my State is saying EPA has approved
    zero of them, zero. Other States have the same problems. Do you
    commit to having a follow-up conversation with this committee
    on the broken exceptional event system? Yes or no.
        Ms. McCarthy. We are having those discussions with States
    as we speak.
        Mr. Olson. This committee then? This committee, commit to
    this committee, have these discussions right here?
        Ms. McCarthy. I will wait on what the chair asks.
        Mr. Olson. OK. We will work on that. Thank you. I yield
    back.
        Mr. Whitfield. Mr. Olson, thank you. I am glad you raised
    this issue because as you said, there are lot of areas out of
    compliance with the Ambient Air Quality Standard today, and
    they are going to make this more stringent. It is probably not
    going to be until after the election. But if you are not in
    compliance, then we know that economic development is hampered,
    and it is something that this committee needs to look at
    because we have some significant economic issues.
        At this time I recognize the gentleman from West Virginia,
    Mr. McKinley, for 5 minutes.
        Mr. McKinley. Thank you, Mr. Chairman, and thank you, Ms.
    McCarthy for appearing before us again. Here is a question. We
    have already talked about CCS and boiler or coal ash and some
    of these other matters, so I won't get into that. But I am
    interested in the Spruce mine----
        Ms. McCarthy. Yes.
        Mr. McKinley [continuing]. And the fact that for 44 years
    the EPA never used that authority to retroactively withdraw a
    permit that they have done in this case, and I guess the answer
    you just gave to the fact that you don't consider the economic
    impact before you make your decision and make a rule on it, I
    guess that comes into play because the consequences of that
    decision have a chilling effect, certainly not just in the coal
    industry but all industries that have a 404 or 402 permits. If
    they have to make those applications, you can pull them.
        I have talked to a bunch of bankers, and they all said they
    are going to revisit their decision whether or not they will
    purchase any bonds or obligations if EPA for the first time now
    is entering in--they can pull a permit. So the consequences of
    your actions are detrimental to the economic growth here in
    this country.
        I am surprised that you don't take that into consideration
    but I will just have to move on.
        Ms. McCarthy. Congressman, I was trying to make a decision.
    The NAAQ standard is really a health-based standard where cost
    is considered in the implementation, not the standard itself.
    And so we certainly----
        Mr. McKinley. I really want to spend more time on the
    Clean----
        Ms. McCarthy [continuing]. Where available----
        Mr. McKinley [continuing]. Water and safe drinking. That
    was more of a comment that I just hope you would be more
    considerate for the economic impact you are doing with some of
    the decisions.
        But on the Clean Water and Drinking Act, I really want to
    amplify a little bit on what Engel and Tonko, their comments
    about that, and I think numbers of other people have made that
    same response. Do you agree with the President's priorities in
    his budget?
        Ms. McCarthy. Yes, I certainly do.
        Mr. McKinley. This is a chart that I just wanted for
    everyone to maybe be able to get a grasp.
        You made me suck in my breath when you said how much the
    President is investing in clean water--when you see that he
    is--now, his recommendation that you say you support is half
    what it was when he came into office. He does not have a
    priority for funding State Revolving Fund, for clean water and
    clean drinking. You can see the numbers drop from 3.9 to 1.78.
    But yet I see that other things. When you have a chance at $555
    million, you have reduced, because you are with him on this,
    you are reducing the allocation into that account, but you are
    increasing the money for climate change, air quality and
    enforcement.
        Administrator, I have got to tell you. I hold a lot of town
    hall meetings and discussions with small communities in rural
    America. They are not concerned, maybe to the level they should
    be, but they are not as concerned about climate change or your
    enforcement. They just want sewer and water lines. And by
    virtue of the President slashing the money for sewer and water
    lines, for water, water quality, that undermines all their
    hopes and dreams of being able to achieve some health
    environment in these small towns.
        How do you react to that when you see that the President is
    not making it a priority to fund clean water?
        Ms. McCarthy. Well, I can answer that in a few different
    ways, Congressman, because the President was clearly respecting
    the bipartisan budget agreement. That put challenges on EPA in
    order to identify how we were going to expend our resources. We
    did recognize that there were significant investments over the
    past 5 years during this administration, well beyond what had
    been invested the prior eight. We know that money is out and
    being expended. We also know that the revolving fund that
    States have been operating for years is accruing significant
    revenues that is increasing the amount of money they can
    spend----
        Mr. McKinley. If I could reclaim the time.
        Ms. McCarthy [continuing]. On these projects.
        Mr. McKinley. I think it is important to also----
        Ms. McCarthy. So we are doing the best we can.
        Mr. McKinley [continuing]. If I could, fortunately the
    chairman of the Appropriations Committee has gotten a hold of
    this, and now he is stopping it and reversing this downward
    slide by holding steady the amount of money we have for this.
        I am just going to reinforce again as at the end. These
    other issues of enforcement, clean up our communities, there
    may be--that is not what America is worried about. American
    citizens in these small towns want sewer and water lines, and
    for you to take an arbitrary--you said it was a tough decision.
        Ms. McCarthy. Um-hum.
        Mr. McKinley. Think about what that decision is for those
    small towns where they are trying to improve their economy,
    they are trying to give health. I can tell you example after
    example of people of those little communities that have no
    money and no clean water, and yet we put money into more
    environmental----
        Ms. McCarthy. Part of our consideration, sir, is how does
    climate actually exacerbate the challenges of our----
        Mr. McKinley. Oh, come on.
        Ms. McCarthy [continuing]. Infrastructure with----
        Mr. McKinley. You know better than that. We will talk about
    that another day, and you know--it has nothing to do with
    climate change, and you know that.
        Mr. Whitfield. At this time I recognize the gentleman from
    Illinois, Mr. Kinzinger, for 5 minutes.
        Mr. Kinzinger. Well, thank you, Mr. Chair, and
    Administrator McCarthy, thanks for being with us today----
        Ms. McCarthy. Great to be here. Thanks.
        Mr. Kinzinger [continuing]. And during the long times. I
    want to chat a little bit about nuclear. Nationwide, four
    nuclear plants retired last year, and at least one is scheduled
    to shut down this year. In Illinois, half of our electricity
    generation in fact comes from nuclear plants. Does your agency
    believe that nuclear is critical to provide affordable,
    reliable electricity in the United States?
        Ms. McCarthy. Well, certainly the President does as well as
    the Secretary Moniz at the Department of Energy. EPA tries to
    stay in our lane and make sure that any permits can be issued
    and work can get done, but clearly nuclear plays a big part of
    the current generation capacity, the base load capacity, and
    from a carbon perspective, it is extremely important.
        Mr. Kinzinger. So on January 24th of this year, the CEOs of
    five nuclear companies wrote to your Agency expressing their
    concerns with the cooling towers, or it is the 316(b) rule of
    the Clean Water Act. They raise concerns that the rule could
    trigger the premature retirement of a significant portion of
    the nuclear fleet.
        The letter states that in Virginia, Dominion's preliminary
    estimate for retrofitting the Surry Nuclear Power Station with
    cooling towers is about $3 billion. For the Diablo Canyon Power
    Plant in California, which serves about 10 percent of their
    State's needs, the cost is estimated to be upwards of $12
    billion. And lastly, the letter states that the projection of
    the North American Electric Reliability Corporation on units
    impacted by this rule-making could cause a closure up to 39
    gigawatts of electric generating capacity.
        So I just want to ask what steps, if any, is the EPA taking
    to address the concerns expressed by these nuclear companies?
    And can you provide any assurances that the EPA's cooling tower
    rule will not cause the premature retirement of a significant
    portion of the nuclear fleet?
        Ms. McCarthy. Certainly we have had a number of utilities
    come in expressing concern about 316(b) that was proposed.
    There has been a robust dialogue as there always is, and they
    have come into us. They have had meetings at our Office of
    Management and Budget, and we have been working really closely
    with our other agencies to understand the implications and to
    make sure that this rule is reasonable and appropriate.
        I think you will see that we have listened very closely
    when this rule is released.
        Mr. Kinzinger. Do you have any concerns personally about
    the premature retirement of those plants?
        Ms. McCarthy. We have seen some of the numbers as we are
    looking at greenhouse gas emission projections, and I would
    indicate to you, being from the New England region, I can
    remember when one of our large nuclear base load facilities
    went out when I was working in Massachusetts. It was a scramble
    to try to ensure that we had the reliability we needed, and we
    certainly want to do nothing that would impact reliability in
    this country. But we also want to make sure that we deal with
    the pollution challenges effectively.
        Mr. Kinzinger. And so you would consider the preservation
    of nuclear plants a key part of the administration's, what they
    call their climate change policy?
        Ms. McCarthy. Nuclear is part of the all-of-the-above
    strategy, yes.
        Mr. Kinzinger. OK. It is been reported that the DOE--you
    may or may not be able to answer this--is analyzing a scenario
    in which one-third of our nuclear power plants retire and the
    impact that that would have on the President's Climate Action
    Plan--has estimated that the closure of one-third of our
    nuclear plants would increase electric sector carbon emissions
    by 8 percent, and have you accounted for such a scenario in
    your Agency's modeling?
        Ms. McCarthy. We are looking at a variety of different
    models, yes.
        Mr. Kinzinger. Again, just briefly I'd like to change
    topics about the benefits of mechanical insulation when it
    comes to saving water and energy. Mechanical insulation is a
    proven technology that does not require additional research or
    engineering. Simply put, it is an energy-saving tool that is
    available for deployment today. I have seen instances in which
    your Agency has partnered with various industries, most notably
    the lighting industry, to promote the energy savings that can
    come from using certain projects. Has your agency considered
    partnering with insulation industry in order to push a similar
    program?
        Ms. McCarthy. I do not know, but I will certainly find out.
        Mr. Kinzinger. So you guys would be open to an opportunity?
        Ms. McCarthy. To be very honest with you, I am looking with
    a blank stare for a good reason.
        Mr. Kinzinger. I got you.
        Ms. McCarthy. I know nothing about mechanical insulation.
    But I am more than happy to go back and see if there is
    opportunities there for us.
        Mr. Kinzinger. If you are open to it, I would like to have
    maybe my staff follow up with your staff----
        Ms. McCarthy. That would be great.
        Mr. Kinzinger [continuing]. And we could go from there.
    Thank you, Mr. Chairman and Administrator, thank you, and I
    yield back.
        Mr. Whitfield. The gentleman yields back. At this time I
    recognize the gentleman from Virginia, Mr. Griffith, for 5
    minutes.
        Mr. Griffith. Thank you for being here. I appreciate it.
    You know, it is interesting because it doesn't happen that
    often particularly when we have the EPA Administrator in. But
    without any reference or without any discussions in advance,
    you have had at least two Democrats and now two Republicans
    talk to you about the Clean Water State Revolving Fund.
        This is a big deal, and as you know, I don't often agree
    with things that the EPA is doing. That is one that I have
    touted before publically as something that the EPA gets right,
    and you can imagine my surprise and chagrin when I noticed that
    the President's budget has a 430--and I have heard higher
    numbers, but my folks gave me $430 million cut to that program
    which is so important. And it is particularly important in the
    very reasons that are being impacted by the policies on coal.
    And you know so my district is not a wealthy district. The
    unemployment for those people that are still trying to find
    jobs is high. District-wide it averages out to about $7.61. But
    when you take into account just the coal-producing counties, it
    is over 9 percent unemployment, and it is not just the 9
    percent loss of jobs that are minimum-wage jobs, those are the
    jobs that are paying $60,000, $75,000, $85,000 a year and came
    with benefits. And when you lose hundreds of those over a
    course of just a few years, and my district hasn't been hurt as
    bad as parts of West Virginia and Kentucky, it makes a big
    deal. It is a big difference. When you don't have a job and you
    don't have clean water, it is not a great thing.
        But my folks don't want to be forced to move out of the
    mountains where their ancestors and they have lived for
    hundreds of years. And so I ask you to go back and take a look
    at the revolving fund because it is a big deal.
        Ms. McCarthy. Thank you.
        Mr. Griffith. And I appreciate that. I will have to also
    point out that it is one of the things in the administration--
    you are not the only one. Everybody keeps thinking that it is
    not the policies that are pushing coal out the door as much as
    it is the price of natural gas. So I did some quick checking on
    that. Last week, on 3/26, it was $4.42. The experts have all
    told us--per million BTU, the cost of natural gas. Experts have
    all told us that coal competes just fine at $4 or higher. They
    have also told us that they anticipate long term over the next
    couple of years or decades natural gas prices will stabilize in
    the $4 to $6 range. But the coal companies have always been
    used to that fluctuation, as have the power generation
    companies, that fluctuation in price, and I went back and did
    some checking. Toward the end of March in 1997, March 21, 1997,
    the price was $1.87 for the natural gas. March 22, 2002, $3.57.
    2007, $7.16. 2010, $4.08. So it is not the price alone. Sure,
    natural gas went down quite a bit. This winter it spiked in the
    Northeast quite a bit. It has leveled back out into that $4
    range, $4.33 the week before this one or earlier in March,
    $4.42 last week.
        And so you know, to say that that is the reason that all
    these coal facilities are closing down is not accurate. It is
    in fact the policies of this administration that are closing
    that down, that is causing the cost of electricity to go up.
    You know, if we could count on having $2 natural gas which
    nobody thinks we can indefinitely, then theoretically over time
    the consumer who is paying those electric bills might see their
    rates stabilize. That is not going to happen. It is going to be
    a higher rate. And when you take all the coal-powered
    generation off the board, all those families that are
    struggling to make ends meet with the high unemployment rate or
    who are middle-income Americans are going to suffer, and it is
    a serious and significant problem. And I hope that when you are
    looking at your budget, you pay close attention to that as well
    and realize that maybe where we ought to be cutting is the
    folks who are writing all the new regulations here in DC, not
    the folks who are out examining things and not the folks who
    are doing the clean water projects.
        Also, if I could ask you, in regard to EPA's pending
    greenhouse gas rules for existing power plants----
        Ms. McCarthy. Yes.
        Mr. Griffith [continuing]. That are expected to be proposed
    in June, recognizing the difference between setting a standard
    and complying with a standard, do you believe you have the
    legal authority to set the standard based on reductions that
    occur outside the fence line of the facility? And if so, where
    does that authority come from?
        Ms. McCarthy. We have certainly heard from States in our
    many discussions as well as the energy sector that we are
    working with closely that they want us to provide as much
    flexibility as we can in terms of the compliance with this----
        Mr. Griffith. Well, we are certainly under enough pressure
    as it is----
        Ms. McCarthy [continuing]. But any guidance that----
        Mr. Griffith [continuing]. And I only have another second.
    I do want to ask, if the courts vacate, stay or remand the
    rules for the new coal-fired power plants, how does that impact
    your working on the rules for the existing plants? I am talking
    about the carbon.
        Ms. McCarthy. You mean when we finish some?
        Mr. Griffith. Yes, when you finish.
        Ms. McCarthy. They are only proposed so we----
        Mr. Griffith. I understand.
        Ms. McCarthy [continuing]. Need to go through a final. It
    is my understanding that a 21(d) is only required and
    appropriate when you have an existing 111(b) standard that
    governs either new or modified or both.
        Mr. Griffith. All right. I appreciate your answers, and I
    yield back.
        Ms. McCarthy. Thank you, sir.
        Mr. Whitfield. The gentleman's time is expired. At this
    time I recognize the gentleman from Ohio, Mr. Johnson, for 5
    minutes.
        Mr. Johnson. Thank you, Mr. Chairman, and Administrator
    McCarthy. Thanks again. It is good to see you again today.
        Ms. McCarthy. You, too.
        Mr. Johnson. I am sure you probably remember back in May of
    2012 you met with Representative Shelly Moore Capito and me to
    discuss a rule that you were working on for ferromanganese
    producers. As there are only two remaining domestic producers
    of this strategically important product left in America, you
    were gracious and gave us your word that the EPA would work
    with the two companies and other stakeholders to craft a rule
    that meets the statutory obligations of the EPA, mitigates the
    unreasonable risks and allows the facilities and the jobs
    associated with those facilities to remain the United States. I
    am fearful that all of that work and your graciousness has been
    for naught because it is my understanding that the rule that
    you submitted to OMB goes well beyond what the stakeholders and
    your own EPA staff had designed to address the local risk
    concerns after substantial investment in time and effort and
    resources in pursuing the three objectives that you gave to us.
        Furthermore, nearly 200 men and women in my hometown of
    Marietta, Ohio, will likely lose their jobs because of your
    Agency's actions on this rule. Are you comfortable with sending
    this vital industry and the related jobs related to
    ferromanganese production overseas?
        Ms. McCarthy. I do remember the concerns that you raised,
    sir, and I believe we have developed a proposal that is now
    being looked at that will meet my obligation to you to look
    closely at this. If we have missed our mark, we are talking
    about a proposal that is due to go out in the end of May. So we
    can certainly have conversations. I would encourage that
    because----
        Mr. Johnson. Well, when----
        Ms. McCarthy [continuing]. During the interagency process,
    folks have an ability to come in and we can talk through these
    issues and when the proposed rule is issued in May.
        Mr. Johnson. Well, I would really like to sit down and have
    another conversation then because it is my understanding that
    the rule that has been sent to OMB goes above and beyond. It is
    going to level millions and millions more on these companies,
    and they are going to shut down.
        Ms. McCarthy. Yes.
        Mr. Johnson. And the crux of the problem is that it goes
    beyond what your own staff recommended in their initial
    findings in working with those companies. So I just want to
    make sure that the hard work that your team went to and that
    these companies went to that we actually produce a----
        Ms. McCarthy. And I want to make folks--make sure that they
    actually understand what is likely to be proposed so that if
    you could encourage it, we can certainly reach out to the
    company directly.
        Mr. Johnson. Well, we will----
        Ms. McCarthy. There are only a few of them. I am more than
    happy to do that if----
        Mr. Johnson. We will reengage. We will reengage. As you
    know, there aren't many secrets in Washington these days,
    except for maybe----
        Ms. McCarthy. Apparently not.
        Mr. Johnson. Except for maybe the real--what the 7.1
    million people that have supposedly enrolled in the healthcare
    law consist of, how many of them had insurance before, and how
    many of them have actually paid their premiums. That is the big
    secret to everybody. But this is not--
        Another one. Your Agency is also working on a MACT rule
    that will significantly impact the brick-making industry.
        Ms. McCarthy. Yes.
        Mr. Johnson. This MACT is unique in that it had already
    been issued, yet it was overturned and vacated by the courts
    despite the brick industry already investing $100 million in
    compliance costs over 10 years. Yet, these controls are now
    being used to establish a new floor for brick industry
    emissions. Recently I helped spearhead a bipartisan letter,
    some 70 members signed it, urging you to reconsider the current
    proposal and use the tools provided within the Clean Air Act to
    minimize regulatory burdens on the brick industry that do not
    provide commensurate environmental benefits.
        So what have you done, Madam Administrator? What have you
    done in regards to addressing our concerns as your Agency works
    toward the August 2014 deadline?
        Ms. McCarthy. We agree with you that this is a proposal
    that actually encompasses a broad number of facilities. Many of
    them are small businesses, and so we are extremely sensitive to
    do outreach to those businesses to make sure that any proposal
    that we put out will be--so to fully understand their concerns
    and what technologies are available and what those standards
    ought to be. This is very challenging.
        Mr. Johnson. I am out of time, but if I could just get your
    commitment? You know, $100 million is a lot of money for that
    industry.
        Ms. McCarthy. I understand.
        Mr. Johnson. Could I get your commitment that you will
    consider that investment already in whatever rules you
    establish? Because that's a vital industry and----
        Ms. McCarthy. Thank you for bringing it up, sir. It is a
    challenge.
        Mr. Johnson. OK. Thank you.
        Mr. Whitfield. At this time I recognize the gentleman from
    Missouri, Mr. Long, for 5 minutes.
        Mr. Long. Thank you, Mr. Chairman, and thank you,
    Administrator McCarthy, for being here today and giving your
    testimony.
        The winter in my part of the country, we have had real
    sharp propane price spikes----
        Ms. McCarthy. Yes.
        Mr. Long [continuing]. Which were market driven, but
    something that could not be controlled by the people in our
    area, of course, and we are going to have them again because I
    just know how the market works. And when that happens, people
    in southwest Missouri where I am from turned to burning wood, a
    good, reliable source of heating their homes because it is
    cheap, available, reliable, and families use wood stoves to
    heat their homes. Farmers use wood-burning stoves and heaters
    for their livestock and other operations. This New Source
    Performance Standard or NSPS, I guess we are calling it here
    today, as I understand were designed primarily to regulate
    industrial activities in large facilities like commercial-scale
    power plants and oil refineries or manufacturing operations.
        Many of my constituents are very concerned about the EPA's
    move forward with potentially unachievable NSPS regulations on
    these wood stoves.
        Ms. McCarthy. Yes.
        Mr. Long. And are you aware of the significant concerns
    because I know I have heard a lot about it with the pending
    regulations and their impact on the affordability of wood, wood
    heating?
        Ms. McCarthy. I certainly am aware of the reliance on wood
    stoves in many communities, and we have been working on this
    rule and working with States and stakeholders for a long time.
    And I think the good news about this rule is I think you will
    see that we listened. We narrowed the kind of technologies that
    we will actually be regulating under this rule. It is only
    about new wood stoves, not existing, and it actually spreads
    the timeline to achieve this window out 5 years so that we can
    take advantage of all the new technologies that are in the
    marketplace to make it efficient for people when they burn
    wood. I know this is important. I expect we will get lots of
    comment on this proposal, but I am sensitive both to the need
    to use wood but also to the impact in some areas that wood
    burning actually has on particulate matter levels.
        Mr. Long. So the stoves that are on the market today can
    continue to be sold for 5 years, is that correct?
        Ms. McCarthy. The stoves that are on the market today can
    be sold for 5 years, but in that--but no stoves are actually
    going to be taken off the market. We know that stoves are
    available to achieve the standards that are in the rule, but we
    pushed that out 5 years----
        Mr. Long. They are available now?
        Ms. McCarthy. They are available now. And we just pushed
    that compliance window out so that we wouldn't be impacting the
    current stoves that are for sale but only sending the right
    signals that those newer stoves, those more efficient, are ones
    that should be entering into the marketplace 5 years from now.
    We actually provided an alternative that would make it 8 years
    as well. So we are trying our best to help this transition
    along without impacting the wood stove industry which is really
    coming up with some very efficient stoves moving forward.
        Mr. Long. These stoves are available now that----
        Ms. McCarthy. That is right.
        Mr. Long [continuing]. Comply with the standards that will
    go into effect 5 years from now?
        Ms. McCarthy. That is correct.
        Mr. Long. I doubt--if you want to tell me now, you can, if
    you have it off the top of your head what those are, but could
    you get back with the committee and give me a list of what
    companies, what brands, what models----
        Ms. McCarthy. Absolutely. Yes.
        Mr. Long [continuing]. Currently today because that would
    help me because I am answering a ton of mail on this----
        Ms. McCarthy. I would----
        Mr. Long [continuing]. And people are very, very concerned
    in my area. So if you can provide that to the committee, I
    would appreciate it greatly.
        Ms. McCarthy. That would be great. I would be happy to do
    that.
        Mr. Long. Thank you. And with that, Mr. Chairman, I yield
    back.
        Mr. Whitfield. The gentleman yields back. At this time I
    recognize the gentleman from Colorado, Mr. Gardner, for 5
    minutes.
        Mr. Gardner. Thank you, Mr. Chairman, and thank you,
    Administrator McCarthy----
        Ms. McCarthy. How are you?
        Mr. Gardner [continuing]. For joining us today. Last Friday
    the White House announced a strategy to cut methane emissions
    for the oil and gas sector. The White House states, and I
    quote, ``In the spring of 2014, EPA will assess several
    potentially significant sources of methane and other emissions
    from the oil and gas sector. EPA will solicit input from
    independent experts through a series of technical white papers.
    In the fall of 2014, EPA will determine how best to pursue
    further methane reductions from these sources. If EPA decides
    to develop additional regulations, it will complete those
    regulations by the end of 2016.''
        I am concerned that these efforts could harm the economy of
    many States, especially States who are trying to promote their
    own efforts and other States that are seeing the benefits of
    unconventional oil and gas production. The University of
    Colorado estimates that 68,000 jobs could be lost in Colorado
    and even more in secondary jobs if hydraulic fracturing is
    prohibited.
        Now, we also have an immense opportunity before us to sell
    some natural gas abroad which I think would strengthen our
    allies and lower our trade deficit.
        We had a hearing last week on legislation I introduced,
    H.R. 6, that would reform the LNG export approval process. I am
    worried that the administration's regulations may end one of
    the few good economic stories that is happening in our country.
    What kind of regulations for the oil and gas sector are under
    consideration at this point?
        Ms. McCarthy. Under consideration at this point is actually
    a release of white papers. We are actually going to be working
    with the industry, going to collect data, before any decision
    is made about any next opportunity that regulation may provide.
        Mr. Gardner. Those are regulations on methane?
        Ms. McCarthy. That is correct.
        Mr. Gardner. Any other regulations on other matters?
        Ms. McCarthy. I am trying to think. I don't want to answer
    too quickly. If there is, I will let you know.
        Mr. Gardner. OK.
        Ms. McCarthy. But at this point, I am not anticipating any.
        Mr. Gardner. What is the legal authority for the methane
    regulation?
        Ms. McCarthy. It would be under the Clean Air Act. Right
    now we actually regulate volatile organic compounds from
    natural gas wells during the hydrofracking process because that
    is already a traditional pollutant under the Clean Air Act. It
    captures the methane. It may very well be that we decide not to
    regulate methane from additional wells.
        Mr. Gardner. Would that be Section 111 of the Clean Air
    Act?
        Ms. McCarthy. That is correct.
        Mr. Gardner. That is Section 182 of the Clean Air Act?
        Ms. McCarthy. That is correct.
        Mr. Gardner. Are there other possible statutory authorities
    outside of those two?
        Ms. McCarthy. None that I have considered.
        Mr. Gardner. But nothing that you have considered but there
    may be other statutory authorities?
        Ms. McCarthy. There may be. I have no----
        Mr. Gardner. Has EPA already decided to develop additional
    methane regulations for the oil and gas sector?
        Ms. McCarthy. No.
        Mr. Gardner. If EPA hasn't decided whether to issue
    regulations or what form they may take or confirm the statutory
    authority, why are you setting up a schedule for completing the
    regulations?
        Ms. McCarthy. It was in anticipation to send the signal to
    the industry about when it might be considered, but the first
    step is a white paper to collect information. Colorado and
    other States have been developing their own regulations on
    these issues. We are very respectful of that. We need to work
    with the States in the industry before any decision is made.
        Mr. Gardner. Last week EPA also announced plans to bring
    nearly all rivers, creeks and streams under the regulatory
    control of the Federal Government through the Clean Water Act.
    EPA's proposal would now cover streams that might only flow in
    some seasons and are isolated from navigable waters.
        In my State of Colorado, where according to the EPA's own
    study, 68 percent of the streams are intermittent. This
    proposal could have a major impact. The bipartisan Western
    Governors' Association immediately criticized EPA's proposal on
    the day that it was released in a letter that was cosigned by
    my State's Governor. The Governors stated that they were not
    adequately consulted on this proposed regulation, and the
    proposal could harm a State's ability to manage their waters.
        How will you correct this problem?
        Ms. McCarthy. Well, we have certainly done outreach, and we
    will work with the Western Governors' Association. I talked to
    Governor Sandoval yesterday. And so we have been working with
    the States on this issue. But your characterization that the
    waters of the United States is actually going to be bringing
    every water under the jurisdiction of the Waters of the United
    States is not correct, sir. Actually, we have listened to the
    Supreme Court, and what is included in the Waters of the United
    States are waters that are navigable as well as those waters
    that could significantly impact----
        Mr. Gardner. What do you define as----
        Ms. McCarthy [continuing]. The chemical, physical and
    biological----
        Mr. Gardner. What do you define as navigable?
        Ms. McCarthy [continuing]. Integrity of navigable----
        Mr. Gardner. What do you define as navigable?
        Ms. McCarthy. The same way that you would.
        Mr. Gardner. Put a boat in it?
        Ms. McCarthy. Rivers, large rivers, large streams.
        Mr. Gardner. Large? What is large? I mean, seriously,
    because I am thinking of the South Platte River in Colorado. I
    am thinking of the Republican River in Colorado----
        Ms. McCarthy. I don't think there is any disagreement----
        Mr. Gardner [continuing]. To Arkansas.
        Ms. McCarthy [continuing]. About what a navigable water is,
    sir. The question is what is the extent of Waters of the United
    States and is it limited to navigable waters? And it actually
    isn't. It includes navigable waters, and those waters, that if
    they are damaged, could significantly impact the integrity of
    navigable waters.
        Mr. Gardner. But an intermittent flow----
        Ms. McCarthy. That has never been in question.
        Mr. Gardner. An intermittent flow river could be considered
    at times a navigable river?
        Ms. McCarthy. It absolutely could.
        Mr. Gardner. So 68 percent of the rivers in Colorado which
    are intermittent, could then fall under this rule?
        Ms. McCarthy. They could actually have to do a test or a
    case-by-case analysis as to whether or not they are not only
    hydrologically connected but whether they have a significant
    nexus to navigable waters. It does not automatically make them
    subject to Clean Water Act permitting.
        Mr. Gardner. Are you familiar with Colorado Water Law as
    compared to other States' water laws?
        Ms. McCarthy. I am not familiar with Colorado Water Law.
        Mr. Gardner. A board of independent science advisors that
    have been tasked by the EPA to study the water bodies that are
    going to--I think my time--I have got a couple of additional
    questions that I would submit to you for the record.
        Ms. McCarthy. I am happy to work with you on this, sir.
        Mr. Gardner. Mr. Chairman, my time has expired. Thank you.
        Mr. Whitfield. All right. Yes, submit them for the record.
    So I guess that concludes the hearing.
        I do want to have a contact at the EPA, Ms. McCarthy,
    because Congressman Rothfus and other members of the
    Pennsylvania delegation, including Senator Casey, have asked me
    to try to arrange a meeting relating to EPA's utility MACT rule
    and its impact on Pennsylvania, Illinois, Utah and West
    Virginia relating to recycling coal waste using a circulating
    fluidized bed technology. They have got these plants, and they
    are taking the coal waste and they are producing power from it.
    And they are cleaning up the environment, eliminating this coal
    waste, and it appears that they are going to be forced to close
    down.
        And so I would like the name of a person that you would
    tell me at EPA that we could talk to because some members of
    the Pennsylvania delegation and others would like to have a
    meeting with you all here to discuss this. So if you could--
        Ms. McCarthy. I will have my Legislative Director get in
    touch with your staff right away, and we will make sure that we
    get appropriate meetings set up.
        Mr. Whitfield. OK.
        Ms. McCarthy. Thank you.
        Mr. Whitfield. Mary----
        Ms. McCarthy. Thanks for calling it.
        Mr. Whitfield. OK. And then you know, the first article of
    the Constitution talks about the legislative branch of
    Government, and we have the responsibility for oversight. And I
    know that you all get a lot of requests, but back in early
    October and early December, as a result of some hearings that
    we had, we had asked for some specific information from EPA to
    reply to our request. We received it today. So it is, you know,
    4 or 5 months in receiving it. And then in November we wrote a
    letter about the Energy Policy Act asking the legal
    justification for setting those three plants in the United
    States as the emission standard, and then on March the 12th, we
    sent a letter requesting documents--March 12th.
        Mrs. Capps. Yes.
        Mr. Whitfield. That was last year.
        Mrs. Capps. This year, yes.
        Mr. Whitfield. Well, we won't worry about that one. But on
    the November 15th letter----
        Ms. McCarthy. We have to have a meeting scheduled on that
    one, sir.
        Mr. Whitfield. We would like to have a response, and then
    you said it was in the record and so forth, but we asked some
    specific questions. We would appreciate a response.
        Ms. McCarthy. If we have not answered you appropriately, we
    will----
        Mr. Whitfield. Well, it is my understanding we have not
    been answered appropriately.
        Ms. McCarthy. OK.
        Mr. Whitfield. So if you would do that, we would appreciate
    that.
        Ms. McCarthy. I will.
        Mr. Whitfield. And then finally I just want to ask one
    question to get it clarified. Can you identify any fully
    operational base-loaded coal-fired power plant using CCS on a
    commercial operation anywhere in the United States today?
        Ms. McCarthy. Did you say power plant, sir?
        Mr. Whitfield. Yes.
        Ms. McCarthy. I am not aware of any, but I will certainly
    double check.
        Mr. Whitfield. Well, we are not aware of any, either, so
    that----
        Ms. McCarthy. I know they are being constructed, and I know
    they are close to operational.
        Mr. Whitfield. Well, with Federal funds, but OK. Thank you
    very much. Did you have a question Mr.--OK. Well, that
    concludes today's hearing. We thank you very much for your
    patience and spending 2 \1/2\ hours with us.
        Ms. McCarthy. Thank you, Mr. Chairman.
        Mr. Whitfield. And we look forward to working with you as
    we move forward. The record will remain open for 10 days, and
    that concludes today's hearing.
        [Whereupon, at 12:40 p.m., the subcommittees were
    adjourned.]
        [Material submitted for inclusion in the record follows:]
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