[Senate Hearing 113-587]
[From the U.S. Government Publishing Office]
S. Hrg. 113-587
THE BAKKEN: EXAMINING EFFORTS TO
ADDRESS LAW ENFORCEMENT, INFRASTRUCTURE AND ECONOMIC DEVELOPMENT NEEDS
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HEARING
before the
SUBCOMMITTEE ON EMERGENCY
MANAGEMENT, INTERGOVERNMENTAL RELATIONS, AND THE DISTRICT OF COLUMBIA
of the
COMMITTEE ON
HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
FIELD HEARING IN SIDNEY, MONTANA
__________
SEPTEMBER 26, 2014
__________
Available via http://www.fdsys.gov
Printed for the use of the Committee on Homeland Security
and Governmental Affairs
______
U.S. GOVERNMENT PUBLISHING OFFICE
92-906 PDF WASHINGTON : 2015
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Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800;
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Washington, DC 20402-0001
COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
THOMAS R. CARPER, Delaware Chairman
CARL LEVIN, Michigan TOM COBURN, Oklahoma
MARK L. PRYOR, Arkansas JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana RON JOHNSON, Wisconsin
CLAIRE McCASKILL, Missouri ROB PORTMAN, Ohio
JON TESTER, Montana RAND PAUL, Kentucky
MARK BEGICH, Alaska MICHAEL B. ENZI, Wyoming
TAMMY BALDWIN, Wisconsin KELLY AYOTTE, New Hampshire
HEIDI HEITKAMP, North Dakota
Gabrielle A. Batkin, Staff Director
Keith B. Ashdown, Minority Staff Director
Laura W. Kilbride, Chief Clerk
Lauren M. Corcoran, Hearing Clerk
SUBCOMMITTEE ON EMERGENCY MANAGEMENT, INTERGOVERNMENTAL RELATIONS, AND
THE DISTRICT OF COLUMBIA
MARK BEGICH, Alaska Chairman
CARL LEVIN, Michigan RAND PAUL, Kentucky
MARK L. PRYOR, Arkansas JOHN MCCAIN, Arizona
MARY L. LANDRIEU, Louisiana ROB PORTMAN, Ohio
JON TESTER, Montana MICHAEL B. ENZI, Wyoming
HEIDI HEITKAMP, North Dakota
Pat McQuillan, Staff Director
Brandon Booker, Minority Staff Director
Kelsey Stroud, Chief Clerk
C O N T E N T S
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Opening statement:
Page
Senator Tester............................................... 1
Prepared statement:
Senator Heitkamp............................................. 59
WITNESSES
Friday, September 26, 2014
Hon. A.T. Stafne, Chairman, Assiniboine and Sioux Tribes of the
Fort Peck Reservation.......................................... 3
Hon. Angela McLean, Lieutenant Governor, State of Montana........ 5
Leslie Messer, Executive Director, Richland Economic Development
Corp........................................................... 6
Hon. Rick Norby, Mayor, Sidney, Montana.......................... 7
Hon. Michael W. Cotter, United States Attorney, District of
Montana, U.S. Department of Justice............................ 19
Michael K. Gottlieb, National Director, High Intensity Drug
Trafficking Areas (HIDTA) Program, Office of National Drug
Control Policy................................................. 21
Scott Vito, Assistant Special Agent in Charge, Salt Lake City
Division, Federal Bureau of Investigation...................... 23
Hon. Tim Fox, Attorney General, State of Montana................. 25
Hon. Craig Anderson, Sheriff, Dawson County, Montana............. 28
Anthony J. Preite, Rural Development State Director for Montana,
United States Department of Agriculture........................ 40
Mike Tooley, Director, Montana Department of Transportation...... 41
John K. Dynneson, Deputy Sheriff, Richland County Sheriff's
Department..................................................... 44
Paul Groshart, Director, Richland County Housing Authority....... 46
Loren Young, Chairman, Richland County Commission................ 48
Alphabetical List of Witnesses
Anderson, Hon. Craig:
Testimony.................................................... 28
Prepared statement........................................... 100
Cotter, Hon. Michael W.:
Testimony.................................................... 19
Prepared statement........................................... 81
Dynneson, John K.:
Testimony.................................................... 44
Prepared statement........................................... 110
Fox, Hon. Tim:
Testimony.................................................... 25
Prepared statement........................................... 96
Gottlieb, Michael K.:
Testimony.................................................... 21
Prepared statement........................................... 86
Groshart, Paul:
Testimony.................................................... 46
Prepared statement........................................... 114
McLean, Hon. Angela:
Testimony.................................................... 5
Prepared statement........................................... 75
Messer, Leslie:
Testimony.................................................... 6
Prepared statement........................................... 78
Norby, Hon. Rick:
Testimony.................................................... 7
Prepared statement........................................... 79
Preite, Anthony J.:
Testimony.................................................... 40
Prepared statement........................................... 102
Stafne, Hon. A.T.:
Testimony.................................................... 3
Prepared statement........................................... 62
Tooley, Mike:
Testimony.................................................... 41
Prepared statement........................................... 107
Vito, Scott:
Testimony.................................................... 24
Prepared statement........................................... 94
Young, Loren:
Testimony.................................................... 48
THE BAKKEN: EXAMINING EFFORTS TO
ADDRESS LAW ENFORCEMENT,
INFRASTRUCTURE AND ECONOMIC DEVELOPMENT NEEDS
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SEPTEMBER 26, 2014
U.S. Senate,
Subcommittee on Emergency Management,
Intergovernmental Relations,
and the District of Columbia,
of the Committee on Homeland Security
and Governmental Affairs,
Washington, DC.
OPENING STATEMENT OF SENATOR TESTER
Senator Tester. Rick Norby, Mayor, come on up and sit at
this table. Good to see you. And the rest of you, if you could
just grab a seat real quick, we are going to get going. This is
liable to be a fairly long hearing. We have three panels of
great witnesses and then there will be some questions and
hopefully some opportunity for folks to visit with one another
as this goes on; but before we get started, I would like ask
those of you that can stand, please stand and join me in the
Pledge of Allegiance.
[Whereupon, Pledge of Allegiance is recited.]
Good morning. I am going to call this to this hearing to
order of the United States Subcommittee on Efficiency and
Effectiveness of the Federal Workforce and Federal Programs.
Today's hearing is titled, ``The Bakken: Examining Efforts to
Address Law Enforcement, Infrastructure and Economic
Development Needs''. We are fortunate to have assembled three
terrific panels of subject matter experts to speak to law
enforcement, infrastructure and economic challenges of
communities within the Bakken. These folks will provide local,
regional, State, tribal and national perspective on critical
issues. By engaging stake holders at each level of government,
I am hopeful that we will identify the most pressing needs of
these communities as well as some much needed solutions. I want
to thank each of our witnesses that are here today and I look
forward to our discussion.
The Bakken formation has emerged in recent years as one of
the most critical sources of oil in the United States. As a
result, we are seeing things in Eastern Montana/Western North
Dakota that we have never seen before, both good and bad. It is
a story of rapid and dramatic flood of workers, families and
wealth into an area that is providing an economic boom for
local businesses and communities, but it is also a story of
local communities left scrambling for scarce resources to meet
urgent infrastructure and housing needs of a largely transient
workforce, and the struggle of those communities to address
immediate needs without doing significant harm to the longtime
residents making a fraction of an oil worker's salary; folks in
the community like police officers, social workers and school
teachers. It is the story of local law enforcement agencies
stretched thin, yet facing unprecedented threats in the sheer
number and complexity of increasingly violent crimes; increased
rates of human trafficking, drug smuggling and criminal
byproducts of drug cartel targeting the large paychecks of oil
workers. In more human terms, it is the story of a young family
living with her six children in a camper for 20 months because
of the scarcity of quality affordable housing; and it is the
story of a beloved high school math teacher, a mother of two,
who was abducted while in a morning jog and subsequently
murdered by individuals who were allegedly drugged out of their
minds. These stories do not reflect who we are or where we
live. Sure, we have a number of significant challenges before
us, but I know many of these witnesses, and I know many of the
folks in this community, they are doing absolutely everything
that they can do to make sure that this is even a better place
to live. Today, I hope this hearing can identify additional
ways we can contribute to that effort, whether it is
highlighting various proposals to address the region's most
urgent needs or addressing how we can improve upon the
collaborative efforts of local, tribal and Federal officials.
With that, I ill keep my opening remarks brief. We have a
number of very good witnesses here, a lengthy list of critical
issues to discuss, and I want to thank everyone for being here
today.
We will start with our first panel. The first panel will
set the stage by laying out a broader economic development
challenges in the Bakken; the second panel is going to speak
more specifically to law enforcement challenges that have
arisen in recent years; and the third panel will speak to
critical infrastructure needs in the region.
First, we have A.T. Stafne who is serving in his third term
as Chairman of the Fort Peck Tribal Executive Board. In 2011,
Rusty was appointed by Governor Brian Schweitzer to the Montana
Fish, Wildlife and Parks Commission. He was the first American
Indian appointed to that commission. Rusty is a member of the
Assiniboine and Sioux Tribes of the Fort Peck Reservation, an
Army veteran from the Korean War. Thank you for your service,
Rusty; thank you for being here; and I look forward to your
testimony.
Then we have Lieutenant Governor Angela McLean. She was
previously an adjunct professor at Montana Tech in Butte. She
also served as Chair of the Montana Board of Regions and on the
Montana Board of Public Education before becoming Lieutenant
Governor of the great State of Montana. Angela has developed
Montana SMART schools, an initiative whose goal is to reduce
energy usage in schools and save taxpayer dollars. She also
chairs the Montana Governor's Drought and Water Supply Advisory
Committee. Angela, as always, it is great to see you; thank you
for being here.
Leslie Messer is the Executive Director of the Richland
Economic Development Corp. During her tenure as Executive
Director, Leslie has actively recruited businesses, pursued
business expansion and retention projects for Richland County.
Some of these victories include recruiting Anheuser-Busch malt
barley handling facility as well as the Nation's largest crane
service company. Leslie, always good to see you; thank you for
being here and we look forward to your testimony also.
And finally, we have Mayor Rick Norby, Mayor of Sidney
since January of this year. He previously served as Councilman
for Ward 3. In his capacity as mayor, Rick has been on the
frontlines facing the challenges of rapid growth in the Bakken
and seeking ways to overcome various economic development and
infrastructure challenges that have arisen from the rapid
growth. Previously, Rick worked on a family farm before
focusing his energy on starting a business, Norby Repair,
almost 15 years ago. Thank you for being here, Rick.
With that, I think we will start out and what we typically
do in these hearings is your entire written statement will be
part of the record. Your testimony, if you could keep it to 5
minutes would be great. I have a boatload of questions to ask
you guys and they are all easy that you can answer, but the
truth is I want to get that information on the record, too, so
Chairman Stafne, would you please get us started, and if I
start rattling that means you might want to wind it down.
[Laughter.]
TESTIMONY OF HON. A.T. STAFNE,\1\ CHAIRMAN, ASSINIBOINE AND
SIOUX TRIBES OF THE FORT PECK RESERVATION
Mr. Stafne. Yes, Senator Tester, good morning and thank
you. Do I need this?
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\1\ The prepared statement of Mr. Stafne appears in the Appendix on
page 62.
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Senator Tester. Yes, you will need that for the clerk so we
can get your testimony.
Mr. Stafne. OK. From our perspective as an Indian nation
immediately adjacent to the unprecedented oil development in
the Bakken, we welcome opportunities to improve the conditions
on our Reservation, including responsible sustainable and
culturally sensitive natural resource development, but we
cannot promote responsible development without adequate
services, infrastructure and sources of capital. Senator
Tester, we know you understand this. Thank you for your recent
response to the National Northern Border Counternarcotics
Strategy Report, which confirmed the lack of resources in
Indian Country. We appreciate your commitment to the continued
work of bringing more attention and resources to the Northern
border and the Bakken so our communities are safe and our
quality of life is strong. The Fort Peck Tribes and our
partners in the region have been leaders in enhancing
communication and collaboration to address our lack of
resources. We have forged positive relationships with our
neighbors. We were one of the first tribes in the Nation to
enter into a cross--deputization agreement with State and local
law enforcement agencies. This revolutionary agreement is a
model for effective policing in Indian Country. In addition, we
jointly operate a 9-1-1 emergency dispatch center with
Roosevelt County, pooling our resources to eliminate the
duplication of services; and together with our partner, Dry
Prairie Rural Water, we are constructing a highly efficient
regional water system and will soon be delivering quality water
from our treatment facility on the Reservation to approximately
75 percent of the population of Northeast Montana. There is
perhaps no better model for cooperation or communication than
exists between the Fort Peck Tribes and our neighbors.
Now, we need Congress to fill its mandatory trust
responsibility to Indian nations to supply necessary resources
to make our communities safe. The conditions on our Reservation
are poor. Half of our people live below the Federal poverty
level, and our residents have the poorest health in Montana.
What's worse, we are now experiencing dramatically rising
social problems and criminal activity like methamphetamine and
prescription drug abuse. This surge in crime has reversed a
downward trend we worked so hard to achieve. Our law
enforcement estimates that nearly 80 percent of criminal
conduct on the Reservation has a drug component.
In order to combat this epidemic, we have an immediate need
for six additional drug enforcement officers. I urge the
Department of Homeland Security (DHS) and other Federal
agencies to work with tribes by promptly providing funds and
equipment to our Bakken-affected communities using instruments
like self-determination contracts to ensure swift receipt of
the resources we desperately need.
Adequate infrastructure is also vital to whether conditions
in our region improve or deteriorate. Federal appropriations
for rural water systems, transportation systems and health,
wellness and public safety facilities make the difference
between success and failure because community stability creates
an environment for economic development.
In addition to services and infrastructure, Indian Country
needs a source of capital for economic development to cross
reservation boundaries. Grant and loan programs provide
necessary bridges to help communities in transition, but tribes
also need the flexibility to pool Federal funds from multiple
agencies to carry out locally designed economic development
programs without conflicting rules and restrictions. The
Department of Health and Human Services (HHS) four-step
descending model, or the proposed NASDA Amendments, could
become the model for Federal funding. We encourage you to
consider a pilot project that allows tribes to pool funds from
various sources to address growing needs relating to the
Bakken.
Finally, Congress must eliminate the problem of dual
taxation in Indian Country created by the 1989 U.S. Supreme
Court decision in Cotton Petroleum vs. New Mexico. This double
taxation creates a serious barrier for development on tribal
lands and is inconsistent with Federal policies designed to
promote tribal development in self-sufficiency.
Thank you for the opportunity to share our perspective. We
look forward to working with you to pay more attention to
resources to our region so our communities are safe and our
quality of life can be strong; thank you.
Senator Tester. Thank you, Chairman Stafne. I appreciate
your perspective. Lieutenant Governor McLean, you're up.
TESTIMONY OF HON. ANGELA MCLEAN,\1\ LIEUTENANT GOVERNOR, STATE
OF MONTANA
Ms. McLean. Good morning, and thank you Senator Tester for
the opportunity to testify before you this morning. Development
in the Bakken region has presented tremendous economic
opportunities for Eastern Montana, but with those opportunities
come challenges. Governor Bullock was helping to address those
challenges long before he became Governor. As Attorney General,
he instituted the first cross-border jurisdiction with North
Dakota; and as governor, when the legislature refused to fund a
public safety initiative in Eastern Montana Governor Bullock
worked with Chief DiFonzo to hire two new drug agents out of
discretionary funds. Our administration intends to continue to
fund those Division of Criminal Investigation (DCI) agents.
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\1\ The prepared statement of Ms. McLean appears in the Appendix on
page 75.
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We are also assisting oil and gas impacted schools. The
Wibaux School District, for example, was awarded $900,000 this
year to assist in construction of a new building, among other
things, and development impacted schools have received a total
of $11.5 million dollars in assistance this year alone.
Additionally, Miles, Dawson and Fort Peck Community
Colleges have received over $2.5 million dollars to address
workforce challenges in Eastern Montana. As part of the Main
Street Montana Project, Governor Bullock announced a plan to
assist the impacted counties in Eastern Montana. The reduction
SRF Loan interest rates are already saving water and sewer rate
payers $29 million dollars this year alone; and as soon as the
legislature approves the plan, the $45 million dollar grant
program will get money where it is needed most in the cities,
towns, counties and tribal governments; but it is not just
monetary assistance that we are providing. We are mobilizing
rapid response teams.
These teams are composed of the best people from Commerce,
the Department of Environmental Quality (DEQ) and DNRC and
customized to meet the needs of each community across Eastern
Montana. Existing programs such as CDBG and TSEP help counties
and local governments fund infrastructure, public safety and
housing projects. There are also multiple infrastructure loan
and financing programs including the Commercial Loan
Participation Program; the Infrastructure Loan Program; the
Value Added Loan Program; and the INTERCAP Loan Program.
Additionally, Senator Tester, there are programs that are
designed to help communities with housing issues; the HOME
Investment Partnership Program; Section 8 Program; Home
Ownership Program; and Housing Tax Credit Program serve to help
mitigate affordable housing needs across Eastern Montana.
Programs such as the Community Technical Assistance Program
(CTAP) work with local governments, officials, planners,
developers and the public to help communities address the
impacts of development and population growth by providing
technical assistance through the sharing of professional
knowledge, conducting workshops and providing templates,
publications and research materials. Since Governor Bullock
took office, we have awarded funding to numerous projects in
Eastern Montana including a $450,000 grant to the City of
Bainville right here in Richland County for a water project.
These are just a few examples of the grant funding and
investments that Governor Bullock's administration has made in
Eastern Montana. The total amount of funding allocated for the
2013 and 2015 biennia to oil-impacted counties in Eastern
Montana totals over $57 million dollars.
Senator Tester, I want to thank you once again for the
opportunity to be a part of this very important conversation
among local, State, tribal and Federal partners.
Senator Tester. Thank you Lieutenant Governor.
Next we have Leslie Messer. Leslie.
TESTIMONY OF LESLIE MESSER,\1\ EXECUTIVE DIRECTOR, RICHLAND
ECONOMIC DEVELOPMENT CORPORATION
Ms. Messer. I also would like to thank you for the
opportunity to give you a little insight on what's going on
here. As you all know, we all do the very best we can with the
education and the resources that we have available to us.
Economic development is no different than the law enforcement
or anyone else, and so we are just going to give you a brief
look on how this goes. The current economy overall in Richland
County right now is very robust, it is very busy. Our labor
force is scrambling; our unemployment right now is 2.1 percent,
and this results in extreme stress and pressure on our downtown
businesses as the oilfield draws workforce away from those
downtown jobs that have always been there. The employers are
having to be very creative in how they are going to circumvent
this issue. They are putting in their own housing; they are
offering different incentives; limiting their office hours and
the services; all to keep moving forward and providing for
their own business success and families. We are doing the best
we can to keep the information out there so that we can work
together with State, local and Federal agencies to get the word
out and to continue to do business as usual. We launched a
website that we put all types of information to educate and
inform the public about what's going on. This site has had over
a 1,000 hits a week. People want to know how much it costs to
be here; what it is like to work and live here. We created
through the investment of our revolving loan fund from our
county commissioners the million dollar phone, or loan fund, we
have been able to provide gap financing to continued
businesses, entrepreneurs and existing businesses. We have 71
jobs tied directly to that in the throes if all this business.
Our office continues to conduct consultations with over 60
engineers and developers and consultants and entrepreneurs all
wanting to see what it is like and if they might be able to
grab a hold of a piece of this opportunity.
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\1\ The prepared statement of Ms. Messer appears in the Appendix on
page 78.
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We have created informational presentation that we have
taken across this State to 60 different times in the last 3
years to educate and inform people of exactly what the needs
are in our area. We have also held instructional and
informational tours for State, legislative and congressional
leaders to bring them in here and let them see this firsthand
on what exactly is thriving and working and challenges are
here. We have also held two Canadian trade missions. We create
and participate in an Eastern Montana Impact Coalition to
address the impacts to the 16 counties of Northeastern Montana
and what we are facing. We are in the final stages of that
impact study. That will hopefully give us a better picture so
that we can take that to the legislature.
Our office has surveyed our residents and our contributing
members on the services and the needs of Richland County, and
the top five priorities are infrastructure, housing, workforce,
lack of daycare and childcare providers as well as additional
restaurants. We have recruited, most recently to Richland
County, an immediate and temporary housing provider to try to
be able to carry some of that load while the stick-built
developments are being built. We created a cost analysis to
take an actual look at the numbers, and while we are ranked
third highest in our region, our market is considerably
different when we are compared with Billings, Bozeman, Denver;
it is extremely different; and we work collaboratively with
Miles City and Dawson Community College to try to assess those
workforce demands and needs and how we might best tailor a
curriculum to the ever-changing robust challenges.
And finally, we have also worked and advocated very hard on
the Lower Yellowstone Irrigation Project with the efforts they
are taking to address the Pallid Sturgeon, the endangered
species, and the effects that if that irrigation project were
to go down, the negative impacts on this economy would be just
tremendous.
So basically, our current and future challenges are our
infrastructure is aging and it is at capacity, which requires
immediate additional funding resources; we have a lack of
workforce, which goes hand-in-hand with the housing. The
housing that is available is being utilized by the oilfield,
but as it has been stated before, that makes it very difficult
for the clerks and the teachers and the police and the county
force; and the constraints to financing for additional projects
is very difficult because the populations that are coming in
are showing that they have less than stellar credit, which
makes it very hard to support them.
I want to thank you for, again, for this opportunity and I
urge you to utilize whatever power and influence you have to
invest additional resources here, not only for the success of
Richland County, but for the improvement of the entire State of
Montana; thank you.
Senator Tester. Thank you, Leslie.
TESTIMONY OF HON. RICK NORBY,\1\ MAYOR, SIDNEY, MONTANA
Mr. Norby. I would also like to thank you, Senator Tester,
for inviting me here today. I will probably be the first one
you use the gavel on. It is really hard for me to keep my stuff
under 5 minutes.
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\1\ The prepared statement of Mr. Norby appears in the Appendix on
page 79.
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Senator Tester. Thanks for the warning.
Mr. Norby. I have only been Mayor for a short time in
Sidney, less than a year, but I served on City Council for 6
years prior, and I can say the largest concern that my
administration has is for its citizens.
Senator Tester. Is what now?
Mr. Norby. Is for its citizens.
Senator Tester. OK.
Mr. Norby. A simple singular concern that encompasses so
many avenues. The City of Sidney and its neighboring
communities are expecting growth at a higher rate, and we are
all struggling to meet the priorities that make up--at the tone
of a small Montana town. Safety, affordable living and
community activities are what draws people to live in our
communities over the larger oil boom in North Dakota is
offering. We are a place to raise a family, not just work and
sleep. In order to maintain this type of community, the City of
Sidney and its neighbors are working diligently to bring in
more police and even Federal funding units such as the Drug
Enforcement Administration (DEA), DCI and the Federal Bureau of
Investigation (FBI). As mayor, I know that having a safe
community that my citizens can walk freely in is important to
my constituents. Since Sherry Arnold's tragic murder, it has
been an uphill battle to give the feeling of safety back to the
community. With the collaboration of all agents, local, State
or Federal, we are following any backpack feeling, maintaining
safety in a place that can easily get out of hand fast is
imperative to the entire nation, keeping the agents that are
stationed here to aid is required.
Housing is a constant discussion being had for the area.
Affordable housing is almost nonexistent, and if it is
affordable it is not livable. Apartments are what is being
mostly developed in Sidney, but they are not the only answer.
Even with new apartments going up to help with the constant
need, the prices are still not going down. To rent a 2 bedroom
apartment in Sidney you could be paying upwards of $2,100 a
month. This causes multiple people to pile into the same
apartment just so they can afford to live here. The shelters in
Sidney are constantly overloaded due to people not being able
to afford the establishments currently provided. I believe the
answer to this is to develop more single-family homes to help
equal out the housing costs in the area. The single family home
is also meant for people to buy not rent, increasing the long-
term citizens to the area that will bring in families, not just
workers, which will increase the number of workers in the area
for non-oilfield jobs and bring more consistent population.
Housing is not the only large cost to the area at the
moment. We are experiencing higher costs of living than any
other areas. The increase in big oilfield jobs can cause price-
gouging on all fronts, including groceries, recreational
activities and basic living needs. The high-paying jobs have
increased the per cap income in Richland County by 29.5 percent
since 2012, according the Montana Local Government Profiles.
This means the rates are forced to increase based on target
rates as provided by the State. When rates increase, the cost
to provide goods increase and prices are raised. Most of the
higher retailers are from the pump to the grocery line. This is
causing many long-term citizens who would have taken their last
breaths in Sidney, pack up and move to more affordable
communities.
Higher wages are also getting long-term employees hired
next to impossible. The City of Sidney starts our public works
department laborers at $18.00 an hour, which is a pretty good
wage until you compare it to the average non-educated oilfield
position starting wage at $25.00. How do small businesses
afford to pay the increase in wages as demanded due to the oil
boom? They raise rates. They raise their prices, sorry, which
in turn cancels any increase in wage that is possible. The City
of Sidney gave a 3 percent cost of living wage increase to all
employees this year, but we also had a 200 percent sewer
increase, which canceled most of the employees monthly wage
increase.
If you look at the impact the oil boom has on basic
citizens in Sidney and surrounding area, it is substantial.
They are now in a daily struggle to maintain their way of
living in order to stay in their hometown. The City of Sidney
does not want to lose its citizens or replace them with new
ones. We want to focus on expanding the City and its area while
maintaining everything our predecessors fought for. We want to
see the old mingle with the new and create a better place to
live. We do not want to be the better community of the Bakken,
we want to be its hometown. In order to accomplish any of this,
we need everyone to see it as we see it; it is the best place
to live.
We cannot accomplish this if we do not get some help. The
Bakken is about utilizing its natural resources, people need to
realize that. We cannot capitalize on the Bakken until we
utilize the surrounding area. Thank you again, Senator Tester.
Senator Tester. Well, thank you, Mayor; and thank you all
for your testimony. I very much appreciate the perspective and
I appreciate the time you put in for your testimony. We are
going to start out with an easy question that's kind of
difficult, and that is each one of you brings a different
perspective to the table. In your opinion, if you were going to
say 'This is my most pressing need', what would it be? We will
start with you Chairman Stafne. What is the most pressing need
that you have up in Fort Peck?
Mr. Stafne. Well, Senator, we really have very many
pressing needs, but one thing that would certainly help would
be funding.
Senator Tester. OK, go ahead, Lieutenant Governor.
Ms. McLean. Thank you, Senator Tester, and thank you fellow
panelists for remarkable testimony. Infrastructure is what we
need, and I think I heard that here; and we need infrastructure
to grow and to sustain that growth now and into the future, and
we articulated a plan for a $45 million dollar grant fund to
impact that sustainable growth here in Eastern Montana. We need
legislative assistance to make sure that becomes a reality, and
with that legislative assistance we could provide that help
that you so desperately need to attract and retain businesses;
to attract and retain quality teachers; and ultimately ensure,
Mr. Mayor, that this is not the bedroom community to the
Bakken.
Senator Tester. Real quick, before, Leslie, you take the
mic, I have just got a quick followup for you
Lieutenant Governor, and that is infrastructure and the $45
million dollar program you talked about, what's going to be
eligible for that $45 million, is it going to be sewer, water,
housing, what's all eligible?
Ms. McLean. Absolutely. Water and waste water districts
will be eligible. Additionally, 10 percent of those resources,
$4.5 million dollars, will be available to meet public safety
needs for Eastern Montana cities, town and tribal communities.
Senator Tester. I have you; and then one last question
because I think it is important. Who is eligible?
Ms. McLean. We have a Tier I, Tier II and Tier III county/
region across the Eastern Montana map, and I would be happy to
provide you with each of those----
Senator Tester. OK, to get more specific, and you may have
addressed this in your testimony and I may have missed it, are
tribes eligible?
Ms. McLean. Absolutely.
Senator Tester. Are municipalities eligible?
Ms. McLean. Yes.
Senator Tester. Are non-incorporated towns eligible?
Ms. McLean. Yes.
Senator Tester. Good. Thank you. Leslie, we will get back
to the original question, and that is what in your--as an
economic development in Richland County, what's the most
pressing?
Ms. Messer. The most pressing need from economic
development is the ability to grow. Our office is the one that
answers the door to opportunity. We are the one that is the
marketing agent saying 'Come be here; live here; work here'.
Senator Tester. Yes.
Ms. Messer. And we cannot continue to grow or thrive if
there's not enough places to flush the toilet; if we do not
have a enough places to live; if the law enforcement cannot
adequately handle that; those are the most pressing. People
come in, those developers come in from North Dakota, and the
opportunity is here. The opportunity is here to invest in this
area for all of the Mon Dak. Those developers come in; they
come from North Dakota and they will walk in my office and say
I want to set my company up here. The environments are totally
different, but I will not take my wife and child to Williston,
North Dakota. I want to be here. Where can I live? What are
your schools like? What is your healthcare like? We promote
that, but it is very stymied and challenging when there are no
available homes.
Senator Tester. OK.
Ms. Messer. And so that's it for us.
Senator Tester. Good. Mayor.
Mr. Norby. I agree with Leslie on that 100 percent.
Infrastructure's got to be the Number 1 concern. I guess I look
at this as a sinking ship, and you could turn on this and look
at this many ways. I mean, yes, you can raise rates and get
everything up to where the target rates are, but that takes
time and right now that sinking ship's going to sink----
Senator Tester. OK.
Mr. Norby [continuing]. And I don't want to drown here, and
I don't want my community to drown here.
Senator Tester. The last time I visited with your
predecessor when I was in town, Mayor Smelser, and he talked
about that infrastructure issue as it applied to your sewer
plant.
Mr. Norby. Yes.
Senator Tester. Can you tell me, briefly, can Sidney grow
at this point in time with the sewer that you have?
Mr. Norby. We are currently on Phase I and just going to be
starting on Phase II of the new lagoon, so we are moving ahead.
When you started the bonding, such as we had talked, we are
already in the motion on that, so yes, we can.
Senator Tester. And so you can utilize the build-out you
are doing right now as far as expansion. You don't----
Mr. Norby. We are good in that area.
Senator Tester. Oh, OK.
Mr. Norby. We have been working with DEQ and stuff like
that. I mean it is a slow process, but yes, we are getting
there.
Senator Tester. Outstanding. Well, that's----
Mr. Norby. That's just the way it is.
Senator Tester. That's good news. This is a question for
Leslie and you Mayor, and Leslie you talked about in your
testimony some of the things that businesses do in creating
stuff, creative things like they own their own housing and
there was some other things too you brought up. Is housing the
primary challenge, is it wages, is it all of the above? What, I
mean, it would seem to me that if you are running a clothing
store in downtown Sidney keeping employees is probably pretty
darn tough and it didn't used to be tough 10 years ago. So what
can be done for these guys?
Well, let's just be honest. What can we do? What could the
county commissioner do, what could the mayor do, what can I do,
what can the Governor's office do to help those businesses? Is
there anything we can do?
Ms. Messer. Richland County and Sidney area has not had the
luxury to slowly and systematically improve their
infrastructure, their streets, their services, the mental
health issues, the----
Senator Tester. Right.
Ms. Messer. We have not had that ability. You cannot tax
the people to do that quick enough to address those issues
right now. So, in my opinion, I believe that the county and the
City are doing the best that they can with the resources that
they have. They have to take care of their citizens first and
foremost. The people that are here that want to be here and
work are being very creative, and what I mean by that is they
have their family members working at all hours; they are
closing their doors at different hours to be able to just
function; they are offering an incentive of maybe of potential
housing for to start with, like maybe a rental to start with,
but then they have to go out and find their own, but as the
oilfield continues to come in and all of those supporting
services continue to come in, we want them to bring their
wives.
Senator Tester. Sure.
Ms. Messer. So that opens the door for some additional
supporting services that could be there for that lady in the
dress shop or whatever, but there's not enough single-family
homes right now to help them set roots down, and that's what
the ultimate goal is in my opinion.
Senator Tester. Gotcha, thank you.
Lieutenant Governor, you've talked about the $45 million
dollar grant program that we talked about here just a second
ago. Are there other plans in place at the State level to
address economic development challenges out there?
Ms. McLean. Absolutely.
Senator Tester. OK.
Ms. McLean. And to dovetail off your last question to Ms.
Messer, I would like to point to the fact that the Governor
launched a very robust conversation about expanding mental
health opportunities.
Senator Tester. Yes.
Ms. McLean. Not just here in Eastern Montana but across the
State of Montana because we know that's desperately needed here
and for folks across the Big Sky State. Additionally, the
Governor wants to expand Medicaid. We think that access is
critical for 70,000 working Montanans who do not have
healthcare, and we think that's an important conversation here
in Eastern Montana as well. I would also like to point to the
fact that the concentric circles that came out of the very
important and complex conversation that took place last
legislative session around K-12 funding led to additional
resources for K-12 schools in Eastern Montana who were directly
impacted by this growth to have the resources they would need
to best meet the challenges, and I would like to point to
Wibaux, for example, who once had a base salary of $24,000, and
is now using those resources that I just spoke to elevate that
base salary to $29,000. I am also aware that districts in
Eastern Montana are using already signing bonuses to attract
and then retain high quality classroom teachers, so those are
some of the efforts that are coming out of Helena specific to
education in the Bakken. Additionally, I would point to the
Montana University System where very robust conversations have
been happening, and I would point to the specific evolution of
a Eastern Montana strike force that was started in the fall of
2011 to meet the workforce needs specific to Eastern Montana.
We know that the SWAMMEI Grant is providing considerable
help in meeting the workforce development needs in the areas of
welding, machine, industrial electronics, industrial safety,
etcetera; and I would like to point to a very important
conversation that just took place earlier this week with
Superintendent Farr from here in Sidney as well as each of the
community college presidents, Klippenstein and President Simon,
along with industry leaders and business leaders from Eastern
Montana with the folks from the Train North Dakota Northwest
Staff to determine how we in our community college system,
including the Fort Peck Community College, could best address
the workforce needs, so I can tell you the Bullock
Administration along with the Montana University System is
working robustly to develop partnerships and develop programs
to meet the needs all across the spectrum whether they are
infrastructure needs; whether they are needs in regards to
debt-loan repayment, and I would like to point to that key
piece along with that $45 million dollar grant program, that's
a key component, Senator Tester. The grant funds may be used to
repay existing debt incurred on or after July 1 of 2011 for
water or waste water projects already underway or completed,
and we think that that is key; and to speak to the safety
needs, which is embedded in so many parts of these
conversations, that $4.5 million as I spoke to----
Senator Tester. Yes.
Ms. McLean [continuing]. Is right there, and if folks can
get their applications in the pipeline, the administration is
going to be ready to address those applications once the
legislature approves the funding.
Senator Tester. OK, good. I appreciate that perspective and
I appreciate hearing those programs. From Federal level, there
are programs, in fact Tony Preite is going to be on one of the
programs coming up, there are programs for housing; there are
programs for infrastructure investment from the Federal level.
I don't know if you have worked with any of them, but I will
just ask this, if you were in my shoes, what program works the
best when it comes to either housing or sewer and roads as far
as where would you put the money, in what Federal program to be
able to meet the needs you have?
Mr. Norby. We do not qualify for anything that's target
rate wise.
Senator Tester. Anything that's what?
Mr. Norby. Any kind of target rates that we have to meet--
--
Senator Tester. I see.
Mr. Norby [continuing]. To qualify for any of this. We
cannot qualify.
Senator Tester. Because the income is going up.
Mr. Norby. Yes.
Senator Tester. So we need to change those incomes.
Mr. Norby. Yes. You need to change that structure. I mean,
you can only raise rates so fast----
Senator Tester. Right.
Mr. Norby [continuing]. Before you end up being the only
person living in Sidney, Montana----
Senator Tester. No, that's not----
Mr. Norby [continuing]. Besides the workers. [Laughing.]
Senator Tester. Gotcha.
Mr. Norby. But I mean that's how we look at it and that's
we went to the bonding method----
Senator Tester. Gotcha.
Mr. Norby. And went that route and are the only options we
have.
Senator Tester. I hear you and you are correct. Go ahead,
Leslie, do you----
Ms. Messer. I would dovetail onto to what he's saying. The
CDBG and the housing, the different housing that happen, that's
all very applicable. We have a very strong housing authority
that is on the forefront of that battle and you will hear from
Mr. Groshart later on in the day, and again, a lot of our
levels and a lot of these programs are focused to the low to
moderate. That addresses a portion of our population. We should
be able to address the teachers and some of the others that may
just barely be out of those limits.
Senator Tester. Gotcha. OK, good. We are going to--I am
going to on. We are going to stick with the two Sidney
residents here for right now. I want to get a better
understanding of the relationship that the economic developers
have, you, Leslie, and with the Mayor, the relationship you
have with the oil companies. Is there a relationship? Have they
stepped up in any way to address any of the challenges that you
have?
Mr. Norby. No, they have not; but me being new, I have not
went out and spoke with them either, so----
Senator Tester. OK.
Mr. Norby [continuing]. I have to be honest about that.
Senator Tester. Is there, and I just do not know this, do
they have point people that you can go to or do you have to go
to each company?
Mr. Norby. I hate to say it, not that I know of.
Senator Tester. OK, all right. Leslie, would you address
that?
Ms. Messer. As I have traveled across the State, that's the
No. 1 question that's asked to me, `Well, why aren't you having
the oil companies pay your bills?' That's a very good question,
but the reality of it is is that these companies are working in
our area but their corporate headquarters aren't here.
Senator Tester. Right.
Ms. Messer. And so it is this chain of command. We have
reached out. Some of them have stepped in, but they are focused
on getting in, getting the product, making a profit and
conducting business. I am not saying it is right or wrong, but
when I have had conversations, they feel they are paying taxes;
they feel they are paying their dues into our State. I cannot
argue with that from a business standpoint----
Senator Tester. No.
Ms. Messer [continuing]. So, historically, being a fifth
resident of Richland County, we try to do the very best we can
to solve our own problems.
Senator Tester. Yes.
Ms. Messer. This is probably one of the first times in
history where we don't have the answers and we are seeking
help, and I don't care where it comes from.
Senator Tester. Exactly.
Ms. Messer. We need to take care of our people.
Senator Tester. I got you; and I appreciate that very much.
Chairman Stafne, I want to ask you the same question. You guys
have had some oil development, on your reservation, or has it
not happened there yet?
Mr. Stafne. Very little, yes. There are various reasons why
this is I guess. The red tape that the companies have to go
through and it takes them forever. We have mentioned this
before, that the Federal regulations imposed by the Department
of the Interior and the Bureau of Indian Affairs, that it takes
to get the approval to drill on Federal land, Indian land, or
Tribal land, whatever it may be. I think a lot of the companies
give up before they get to that stage where they are going to
punch a hole in the ground. That is one very serious drawback
that we have been fighting for quite a while now and we have
been speaking to different agencies and I think you are aware
of that, Senator. We have had various talks about that.
Senator Tester. Yes, absolutely, and it is something that
we need to be working with the BIA and beyond and----
Mr. Stafne. And on that Cotton case.
Senator Tester. Yes, right, exactly.
Mr. Stafne. We have been talking a lot about that. Senator,
I only said one word when you asked me what our greatest need
was and I said funds. I guess I would like to go a little
further----
Senator Tester. Sure, you can, go ahead.
Mr. Stafne. I guess the number one priority of a lot of us
is our healthcare. I mentioned this before; the average age of
the death of an adult male on the Reservation is 51 years old.
I have surpassed that by almost double now. I do not know why;
if I am lucky or not, but that's a shame, a child being born
male can expect to live to 51 years of age; and in a non-native
community, I do not know, I would assume it is 20 years longer
than that.
Senator Tester. Yes.
Mr. Stafne. And you are aware we have Indian Health
Services (IHS), and I have attended hearings with you on them,
so you are aware of the problems there and the fundings we
need. We have no senior homes or senior care. We are trying to
build a wellness center and we are fighting for funds for that.
We are trying to build homes. Even though we do not have the
oil on our Reservation, the people, the workers have moved onto
the Reservation and they are offering big bucks to rent our
houses, and our Native people, our residents are left out.
Senator Tester. Yes.
Mr. Stafne. We have people that are camping out in the
woods----
Senator Tester. Yes.
Mr. Stafne [continuing]. Through the wintertime living in
tents because there is not enough homes built. Our roads and
streets are bad and we need to help our law enforcement. I
testified we can use six more drug agents.
Senator Tester. Yes.
Mr. Stafne. And our courts are overwhelmed with cases, not
only tribal courts, the municipal courts, the State courts, the
Federal courts, and again, money would help with that. I guess
it is not going to cure it, but we would be able to offer a
little resistance.
Senator Tester. Yes.
Mr. Stafne. We have transportation problems. Our
Reservation is 100 miles, approximately, across and the center
of the Reservation, is Poplar where all the reservation
officers are. A lot of people do not have transportation. Our
irrigation system----
Senator Tester. And the list goes on. That's why you said
funds.
Mr. Stafne. Yes, it is never-ending.
Senator Tester. Yes. Thank you, Chairman. Angela, I want to
come back to this $45 million bucks, this infrastructure
package, because there's other questions that keep coming up.
There's a Technical Assistance Rapid Response Team that's going
to be assisting local communities. Could you give me an idea of
who is on that or has it been set up yet?
Ms. McLean. The Rapid Response Teams will be dependent on
the needs of each community, and they will be assembled based
on their requests as theysurface, and so each Rapid Response
Team could look entirely different, but as I spoke in my
initial statement, it would be made up of folks from the Office
of Commerce, the DNRC, the Department of Environmental Quality,
and perhaps others as necessary, perhaps the Department of
Transportation (DOT), and you will be hearing from Director
Tooley later.
Senator Tester. Will local stakeholders have an opportunity
for input?
Ms. McLean. Absolutely, and we will come at their request
and that's part of it. We recognize a large part of this
conversation in securing Federal resources that may be
available to these communities revolves around technical
assistance, and we stand ready in State government to provide
that technical assistance, not just after the $45 million
dollars is approved, but right now we stand ready to offer that
technical assistance.
Senator Tester. OK.
Ms. McLean. And a couple of other things I would like to
just point to in respect to what my good friend Chair Stafne
just said is the Governor's office hears loudly and clearly
your needs to recognize healthcare in Indian Country, and for
the very first time we are having a very aggressive
conversation about housing a tribal health office within the
office of the Governor. Additionally, Senator, you asked what
can the Federal Government do as far as----
Senator Tester. Yes.
Ms. McLean [continuing]. Far as programs. I would speak to
the support of the Housing Tax Credit Program; the Section 8
Housing efforts; the CDBG grants. Additionally, I mentioned the
TACT Grant funding that provided our State with $25 million
dollars. Community colleges got it here in Eastern Montana to
facilitate these workforce development needs, and so we are
having these conversations and we look forward to continue
partnering with you to make sure that we close these gaps where
they exist all across the board for folks.
Senator Tester. I appreciate that, Lieutenant Governor. For
Messer and Norby, a couple of questions that deals with red
tape on Federal dollars, and you may or may not have gone here
before, but I am just curious to know when you are going for
grants or loans, are you seeing unreasonable red tape,
reasonable red tape when you try to approach a grant or a loan,
or maybe you have not been able to get there because of the
income level thatyou just talked about before.
Ms. Messer. I would say that the accessibility is very
challenging. Our office has not applied for several different
reasons because of the fact that we have very strong agencies
within our community that apply for those, but one of the
reasons why we don't is, again, our income levels; the
bureaucracy; the needing----
Senator Tester. Yes.
Ms. Messer [continuing]. To hire a consultant to get
through the application.
Senator Tester. Sure.
Ms. Messer. Those are all very challenging on our very
limited budgets for operation.
Senator Tester. OK. Absolutely, which got to the point that
I thought you were going to get to so thank you. Mayor Norby,
you spoke about impact bonuses for City employees?
Mr. Norby. What's that?
Senator Tester. Impact bonuses for City employees?
Mr. Norby. Yes.
Senator Tester. Your perspective of those? Have those done
what you anticipated them to do or----
Mr. Norby. I would like to give more.
Senator Tester. Yes.
Mr. Norby. That's for sure. We went 3 percent and we went
with a $300 stipend according to how our little bit of oil
money that we do have, you know, revenue checks come in. That
will gauge off that. That's the best we could do right now at
this time to try to be competitive with everybody around us.
Senator Tester. OK. That's good. Do you know if the school
districts have done anything similar?
Mr. Norby. I remember seeing it in the paper. I don't
remember the number. It was like $2.00 or something like that,
wasn't it?
Senator Tester. Because it seems to me it is an incredible
challenge.
Mr. Norby. They do something, but I guess I am not----
Senator Tester. OK, that's fine.
Mr. Norby [continuing]. Able to tell you exactly what they
did, but we kind of followed the lead, me and my City court,
trying to go that direction and that's why we went the way we
went.
Senator Tester. Sure. Well, thank you for that. I am in
constant conversation with the Office of Personnel Management
when it comes to employees that work on the Federal lands out
here because quite frankly if the BLM hires an engineer they
can make twice as much going into the oil patch. Has the State
addressed that issue at all from a State employee standpoint
about competiveness of salaries because I think you guys, from
my experience at the State level we fall under the same kind of
thing, you have a salary structure that's set across the State
for your State employees. Is there anything that you can do or
anything you propose because I am sure you are losing employees
too just like the local businesses are and school districts and
everybody else. Is there anything the State can do or has that
conversation started yet or is it a problem?
Ms. McLean. I can tell you as far as State employees, I
would tell you there would most likely not be a significant
problem.
Senator Tester. OK.
Ms. McLean. However, if there is something we can do to
help communities in Eastern Montana attract and retain workers,
we definitely want to do that, and I would offer Senator Tester
that once a community applies and receives grant dollars
through the Infrastructure Grant Program, that would free up
resources for them to use those dollars that they might have on
the table to attract and retain staff, and that was the whole
notion of the concentric circle conversation around education
was how can we help schools in Eastern Montana have the
resources to attract, retrain high quality teachers in the
classroom.
Senator Tester. OK, good. Chairman Stafne, I just want you
to speak about the difficulties of recruiting and training
police officers. It is my understanding that the starting
salary of a tribal police officer is about $3.00 less per hour
than a person with the same qualifications working across the
border at a Wal-Mart in Williston. That puts us in a heck of a
bind. Talk to me about your challenges with recruiting and
retaining officers.
Mr. Stafne. As far as salary goes, I do not know, but we do
have a couple of members of the Sheriff's Department and maybe
they are on the panel and they can probably discuss that with
you. Are you on the panel?
[Indicating to an officer in the audience.]
Senator Tester. We will take that up with him afterwards.
You are still with the Tribal Police Department?
[Whereupon, an officer in the audience nods head
affirmatively.]
OK, good, all right. Well, I will close it out here because
we have burned through about an hour, and I just want to thank
you guys for your patience as we talk about these issues, and I
also want to thank you all for your service and your vision and
your ability to tell it like it is. I think that's really
critically important, and I think that the testimony you gave
today, I mean, the hope that I get out of this, and I talked
about it a little bit in the opening statement, that the hope
that I get out of this is that we can all sit down and
understand where our challenges are and help one another meet
those challenges. Because the truth is in the case of the City
of Sidney, you can not do it all. You do not have the ability
to do it all; you do not have the resources to do it all, but
hopefully the Federal, the State and the county can help and we
can all achieve the goal we are looking for and that's a place
we can call home, so thank you all very much for being here.
Mr. Stafne. Thank you, Senator, for conducting these
hearings.
Senator Tester. Yes. Thanks you all. Now, we will get ready
for the second panel so you guys probably know who you are. We
are going to change some nametags and let folks get readjusted
here. We have Mike Cotter, Mike Gottlieb, Scott Vito, Tim Fox,
and Craig Anderson. Those five will be up next. We will have to
snuggle.
OK, we need Attorney General Fox and Sheriff Anderson to
come on up and sit right down. Thank you----
Thanks to the first panel on economic development. Our
second panel is going to focus on law enforcement, and we have
a great blend of Federal, state and local law enforcement
officials. The man to my immediate left is Mike Cotter, he is
the U.S. Attorney for the District of Montana. He was nominated
for this position by the President and was confirmed by the
U.S. Senate in December 2009. Mike oversees an office; he
conducts Federal investigations and prosecutions as well as the
majority of Federal civil litigation in which the United States
is a party. I should also note that Mike is a U.S. Army
Veteran, and we thank you for your service not only in the
military but as U.S. Attorney. Thank you for being here, Mike.
And then we have Mike Gottlieb is the National High
Intensity Drug Trafficking Areas (HIDTA) Director. That's a
pretty good handle, Mike. He is with the White House Office of
National Drug Control Policy (ONDCP). This is an important
position in this region. In his role, Mike oversees a $238
million dollar grant program that funds 670 investigative,
prosecution, interdiction and prevention initiatives. Over the
years, he has advised the Obama Administration; the Bush
Administration; and the Clinton Administration in prominent
legal and management roles in ONDCP. Mike, I want to thank you
for coming to Montana, and I want to thank you for coming here
today. We appreciate your flexibility to be here; and then we
have Scott Vito.
He is an Assistant Special Agent In Charge in the Salt Lake
City Division of the FBI. In that capacity, he oversees Bureau
investigations across Montana. Scott first became an FBI
Special Agent in July 1995. Prior to that, he served in the
U.S. Army for 7 years; we thank you for your service; and later
as a police detective. Thank you for being here today, Scott. I
very much appreciate the FBI coming here because you are a big
player in this region.
We also have Attorney General Tim Fox, the Attorney General
for the great State of Montana. He is the State's Chief Legal
Officer, Chief Law Enforcement Officer, and Director of the
Montana Department of Justice. He has a lot of hats. Tim was
elected in 2012 and has previously for the Montana Department
of Environmental Quality. It is absolutely good to have you
here today and I appreciate you taking the time out to be here.
And last, but certainly not least, we have Sheriff Craig
Anderson, Sheriff of Dawson County since June 2003. In that
role he is responsible for a large portion of law enforcement
in this region. Craig is a former Chief Probation Officer with
27 years of experience. Previously, he also worked on the Youth
Justice Council and the Montana Board of Crime Control. As
always, it is great to see you, Craig; thank you for being here
today.
As I told the first panel, if you can keep it to 5 minutes
we would appreciate it, and I am talking to you, Cotter.
Mr. Cotter. I can and I will. [Laughter.]
Senator Tester. If you can keep it to 5 minutes, it would
be great. If I start rattling the gavel you will get the hint,
but I would just tell you that when we set this hearing up we
sat down and we talked about who we wanted, and I am going to
tell you the five of you I did not think we would get all of
you, but we got all of you, and I just want to say thank you
very for taking time. I know you have other things to do, maybe
multiple things to do, but you are here today; you are here in
Sidney to talk about an important issue, and you are here
because you know it is important, so thank you all for being
here. With that, Mike Cotter, you can get us started.
TESTIMONY OF HON. MICHAEL W. COTTER,\1\ UNITED STATES ATTORNEY,
DISTRICT OF MONTANA, U.S. DEPARTMENT OF JUSTICE
Mr. Cotter. Thank you, Senator Tester and thank you very
much for inviting me and giving me an opportunity to speak to
Federal law enforcement efforts here in the Bakken.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Cotter appears in the Appendix on
page 81.
---------------------------------------------------------------------------
First of all, I am a big cheerleader for the efforts that
have been made by the Federal law enforcement over the last 3
years. They have done a damn good job, and I will go into more
detail during the Q and A period as to the things that we have
been able to accomplish in the last period of time.
In 2012, Senator, the United States Attorney's Office for
the District of Montana and the District of North Dakota
convened a law enforcement strategy session in Glasgow,
Montana. There were 150 Federal, state, local and international
and tribal law enforcement personnel from Montana, North Dakota
and Canada that attended the meeting, and from that the
strategy of Project Safe Bakken emerged. That remains a high
priority for Montana and remains a high priority to the United
States Attorney's Office of North Dakota.
Project Safe Bakken's mission is to coordinate and
synchronize the law enforcement efforts between Federal, state,
tribal and local enforcement entities. The purpose is to
detect, disrupt and dismantle organized criminal enterprises
who distribute illegal drugs and commit other crimes in the
Bakken region of Montana and North Dakota. And to that end, the
United States Attorneys for Montana and North Dakota, the
Attorney Generals for Montana and North Dakota, Federal, state,
local and tribal enforcement have formed a task force to share
intelligence to combat crime in the region and affecting
communities including Fort Peck and Fort Berthold Indian
Reservations. And since the inception of Project Safe Bakken in
my office in Montana, we have indicted 117 defendants on
Federal drug trafficking charges specific to the Bakken region.
In one case recently, we successfully prosecuted the leader of
a large methamphetamine drug trafficking organization. The
defendant, Robert Farrell Armstrong, received 20 years in
prison for trafficking large amounts of nearly pure meth into
this part of Montana. We have also opened cases and prosecuted
pornography, oil and gas scams along the Fort Peck Reservation,
worker endangerment and environmental crimes. In North Dakota,
my counterpart over there, U.S. Attorney Tim Purdon, he's seen
a case load increase in Western North Dakota from 126
defendants in 2009 4 to 336 in 2013.
But the beauty of the Project Safe Bakken approach is,
Senator Tester, it is not Montana specific, it is not North
Dakota, it is regional. It also encompasses Saskatchewan and
parts of Manitoba; and what we are experiencing here in
Montana, they see it in North Dakota, they are seeing it up in
Canada, so it really is an effort of all law enforcement
agencies to identify through intelligence gathering and sharing
specific targets that need to be identified and dealt with
effectively through prosecutions.
The other things that we have done from the Montana side,
the Department of Justice (DOJ) has also responded with
training and financial assistance to State, local and tribal
law enforcement. Since 2012, my office here in Montana has
coordinated at least five separate trainings for State, local
and tribal officers out here in Eastern Montana. We have
dispatched Assistant United States Attorneys who have come out.
They have joined up with the Bureau, the FBI, DEA, the Bureau
of Alcohol, Tobacco, Firearms, and Explosives (ATF) to provide
training for the locals. Over in North Dakota, the Drug
Enforcement Administration has just concluded a 2-week drug
investigation school for the Bakken drug agents. Violence
against women; the Department's Office of Violence Against
Women just recently announced the release of two grant
solicitations as a part of a new $3 million dollar special
addition to the Bakken region and will impact both Fort
Berthold as well as Forth Peck. It will aid the local criminal
justice system in responding to the crimes by providing the
resources for Tribal Special Assistant United States Attorneys.
The Project Safe Bakken does illustrate the dynamic working
partnership in Montana and North Dakota between Federal, state,
local and tribal law enforcement entities to combat crime and
address public safety issues. We are committed to
communication, coordination and collaborations with our law
enforcement partners to promote public safety in this area. The
FBI, ATF and DEA have all done intelligence collecting. They
have also identified the issues that are here and fully
understand that systematic long-term changes will be necessary
in order to provide security to the region, but in the short
term, FBI has deployed agents on a rotating detail to Sidney,
Montana. They have created a new squad for Western North
Dakota. The Drug Enforcement Administration and the Bureau of
Alcohol, Tobacco and Firearms and Explosives have also
dispatched agents from Billings to this area to deal with
specific problems and will continue to do so in the foreseeable
future and into the future. As long as there is a problem, the
response will be there.
Thank you, Senator Tester, and I look forward to taking
your questions later. Thank you very much.
Senator Tester. Yes, thank you, Mike Cotter. I very much
appreciate your testimony and I appreciate your service as U.S.
Attorney for the State of Montana; thank you.
Mr. Cotter. Thank you.
Senator Tester. Mike Gottlieb.
TESTIMONY OF MICHAEL K. GOTTLIEB,\1\ NATIONAL DIRECTOR HIGH
INTENSITY DRUG TRAFFICKING AREAS (HIDTA) PROGRAM, OFFICE OF
NATIONAL DRUG CONTROL POLICY
Mr. Gottlieb. Senator Tester, thank you for the opportunity
to appear before you to discuss the Office of National Drug
Control Policy's recently released National Northern Border
Counternarcotics Strategy and ONDCP's work to coordinate the
efforts of Federal, state, local and tribal resources to
address emerging drug threats in the Bakken oilfield region.
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\1\ The prepared statement of Mr. Gottlieb appears in the Appendix
on page 86.
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I am the National Director of ONDCP's High Intensity Drug
Trafficking Areas Program and I am pleased to be in Sidney this
morning as this will mark my third visit to the Bakken region
in the past 10 months. The HIDTA Program provides assistance to
Federal, state, local and tribal law enforcement agencies to
facilitate coordination and cooperation to combat drug-related
safety and health consequences in areas determined to be
critical drug trafficking regions of the United States. Thus,
as part of our activities, we regularly interact with law
enforcement entities working to halt illicit drug use in the
Bakken region. There are 28 regional HIDTAs, which include
approximately 16 percent of all counties in the United States
and 60 percent of the U.S. population. The HIDTA Program is
active and thriving in the State of Montana.
The National Northern Border Counternarcotics Strategy is
the Administration's plan for substantially reducing the flow
of illicit drugs and drug proceeds along our Nation's Northern
border. It provides an overview of current counternarcotics
efforts in the region and identifies strategic objectives and
specific actions that will enable us to achieve our goal. The
2014 Strategy acknowledges the inherent challenges in
curtailing illicit drug trafficking across the Northern border,
among them are the vastness of the border itself, which extends
more than 5,000 miles, as well as the ever--evolving illegal
drug production and trafficking trends that confront law
enforcement officers.
Another challenge is the emergence of drug trafficking and
related crimes resulting from the development of the Bakken
oilfields. In recognition of this emerging threat, the 2014
Strategy includes a specific section dedicated to drug traffic
in the Bakken region and our efforts to address this threat. To
highlight the challenges present in the Bakken region, the
Administration elected to release the national strategy in
Minot, North Dakota, on August 19. The 2014 Strategy updates
and expands upon the Administration's first National Northern
Border Counternarcotics Strategy which was released in 2012.
Like its predecessor, the 2014 Strategy builds upon existing
relationships, programs and policies. It seeks further
opportunities to pursue national security by disrupting
transnational criminal organizations and improves information
sharing, thereby enabling more efficient and effective use of
resources. Specifically, the Strategy lays out several
strategic objectives central to our efforts. They include
enhancing intelligence and information sharing at the Northern
border; interdicting illicit drugs and drug money at and
between ports of entry along the Northern border, on land, in
the air and over the water; and enhancing counterdrug efforts
in cooperation with tribal governments along the border; and
finally, investigating and prosecuting dangerous criminal
organizations operating along or exploiting the Northern
border. The 2014 Strategy contains more than 40 individual
action items that will be implemented in the coming weeks and
months, and ONDCP will oversee theses processes which will be
supported by our numerous Federal, state, local and tribal
partners. The Strategy aligns with the Administration's
foundational document, the National Drug Control Strategy. As
we work to substantially reduce drug trafficking and related
crime across the Nation's Northern border, we are also engaged
in efforts to address the emerging threat of drug trafficking
in the Bakken region. For example, in 2013 ONDCP officially
designated Williams County, North Dakota, as part of the HIDTA
Program. With this designation, HIDTA funds were directed to
hire an additional Special Assistant United States Attorney to
provide support to the prosecution of organized crime and drug
trafficking.
The Administration also launched an interagency
partnership, Project Safe Bakken, to coordinate law enforcement
efforts in the region. ONDCP's HIDTA Program supports law
enforcement efforts in Montana by facilitating cooperation
among Federal, state, local and tribal agencies. Through the
work of the Rocky Mountain HIDTA, more than $900,000 in Federal
grant funds are directed to drug task forces operating in the
State of Montana. The Eastern Montana, the Missoula County, the
Missouri River, the Northwest Montana, and the Russell County
Drug Task Forces bring together Federal resources with 4 State
and 12 local agencies.
The Administration also supports drug prevention efforts in
the Bakken oilfield region. ONDCP's Drug Free Communities
(DFC), Support Program, provides grant to community coaltions
that are focused on identifying local drug problems and
implementing comprehensive strategies that create community
level change. There are currently seven Drug Free Communities
funded by ONDCP in Montana, including one in Sidney, the
Richland County Partnership for Promise Coalition. This
coalition has been collaborating with various sectors of the
community to prevent and reduce youth substance use, and each
year DFC programs staffed from ONDCP conduct grant application
workshops across the country, including special technical
assistance sessions dedicated to helping tribes write
competitive grant applications.
Senator, the Administration's efforts to confront drug
trafficking and its public safety and public health
consequences are comprehensive and varied. A few quick examples
include the $3 million dollar grant from the Department of
Justice's Office of Violence Against Women to strengthen law
enforcement's aid to victims of sexual assault and domestic
violence. HHS and CDC support their public health programs and
health centers in Montana and North Dakota. To strengthen
substance abuse disorder services in the Great Plains Area of
the Indian Health Service, there was increased funding for a
contract mental health therapist and a part-time counselor to
focus on substance abuse treatment.
Senator, as you work to implement the 2014 National
Northern Border Counternarcotics Strategy in the coming weeks
and months, we look forward to working with our many Federal,
state, local and tribal partners to reduce use and its
consequences on both sides of our Northern border and within
the Bakken region as part of the comprehensive administration
effort to address the issues that have arisen from the
development in this region. Thank you, Senator Tester, for your
leadership.
Senator Tester. Yes, thank you Mike, I appreciate your
testimony and thanks for being here once again. Scott Vito.
TESTIMONY OF SCOTT VITO,\1\ ASSISTANT SPECIAL AGENT IN CHARGE,
SALT LAKE CITY DIVISION, FEDERAL BUREAU OF INVESTIGATION
Mr. Vito. Good morning, Chairman Tester. I am pleased to be
with you here today to discuss the FBI's efforts to combat
crime in the Bakken region. The Bakken formation is now
considered one of the most important sources of oil in the
United States. In fact, late last year the U.S. Energy
Information Administration projected that Bakken production in
North Dakota and Montana would ultimately exceed 1 million
barrels per day. The development of the Bakken oilfields has
also caused a sharp spike in both population and income levels.
Unfortunately, the boom in population in the region also
provides significant opportunities for an influx of criminal
elements. In early 2013 in response to this burgeoning crime
problem, the FBI along with its Federal and State law
enforcement partners began to develop a strategy that addressed
the criminal threat to the region. In May 2013, the FBI working
with the United States Attorneys' offices in Montana and North
Dakota participated in a combined strategy session of Project
Safe Bakken. This effort resulted in the FBI's decision to
surge resources to the Bakken area and locate them in Sidney,
Montana. Here in Montana, two agents have been co-located with
their State and local counterparts in the Richland County
Sheriff's Department since July 2013.
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\1\ The prepared statement of Mr. Vito appears in the Appendix on
page 94.
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Additionally, their efforts are supported and bolstered by
numerous FBI resident agencies and two FBI field offices. We
used our intelligence gathering process to consistently assess
the ongoing threat. This information influences our resource
decisions to effectively address those threats, which in turn
ensures the FBI addresses those threats created by the
development in the Bakken. At present, the FBI headquarters has
continued to evaluate the threat and has assured us they will
continue to direct additional resources as necessary. As a
threat-based, intelligence-driven organization, the FBI relies
heavily on intelligence gathered from our State and local law
enforcement partners and private sector relationships. Project
Safe Bakken was a deliberate precise targeting of an emerging
criminal threat to the area. The purpose of this long-term
project is to detect, disrupt and dismantle drug trafficking
organizations and criminal enterprises that are operating in
the Bakken region in Montana and North Dakota. Importantly,
this Task Force approach allows us to both share intelligence
and force multiply. Through such efforts, we not only address
those crimes which are statutorily within the FBI's
jurisdiction,but also share vital information needed by our
State, local and tribal partners to combat crime within the
community.
For example, collaborative efforts among Federal, state,
local and tribal partners in June 2013 resulted in the arrest
of 22 people. Similarly in October 2013, a coordinated effort
led to four arrests in North Dakota and 12 in Montana. Earlier
this year, Operation Pipe Cleaner and Operation Pale Mule saw
the arrest of more than 35 individuals. The charges were
predominantly related to drugs, specifically related to heroin
and methamphetamine, which have become increasingly available
in the Bakken region. As an example of our continuing
coordination and integration with local law enforcement, within
the last month our agents working with the Sidney Police
Department in Montana and the Williston Police Department in
North Dakota on two firearms thefts. Our agents worked with the
police departments and were able to gather significant
evidence. Using this evidence, we were able to leverage our
national resources to gather items of comparison from
California that led to the identification and the arrest of a
subject by the Sidney Police Department. This investigation is
ongoing and may result in additional charges.
Chairman Tester, let me assure you that the FBI remains
committed to assisting our State and local partners in making
certain that the safety and well-being of the people in Montana
remains a priority. Thank you again for the opportunity to
testify. I will look forward to answering any questions that
you may have.
Senator Tester. Thank you, Scott. I appreciate your
testimony. Attorney General Fox, you are up.
TESTIMONY OF HON. TIM FOX,\1\ ATTORNEY GENERAL, STATE OF
MONTANA
Mr. Fox. Chairman Tester, thank you for inviting me here to
speak with you today and to answer questions. Thank you, also,
for coming to Sidney, welcome home. I think it is vitally
important for Congressional Committees to hold field hearings
throughout the country, especially when the subject matter is
tied to a particular place. Opportunities and challenges tend
to be a little different up close than they do from Washington,
DC, as you well know. I say opportunities and challenges
deliberately because this is precisely what we face here in
Eastern Montana. We cannot speak of one without the other. Oil
and gas development is the second largest industry in Montana.
It is responsible for more than 12,000 direct jobs locally,
which pay on average $60,000 per year, well above the majority
of wages in Montana. The industry is also responsible for
thousands of more indirect jobs. Last year, oil and gas
development generated more than $200 million dollars in tax
revenue for Montana's State and local governments. By the way,
much of that should be redirected back to this area I believe.
But also many other States have faced sizable budget deficits
in recent years. Montana has enjoyed comfortable surpluses and
economic balances while still providing vital services to its
citizens. We would not have been able to do so without the
economic activity from resource development. What is happening
here in Montana and North Dakota is part of the ``all of the
above'' energy strategy emphasized by President Obama.
Hydraulic fracturing and other technologies have evolved over
the years and now represent an unprecedented opportunity to
safely and responsibily work toward our Nation's energy
independence.
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\1\ The prepared statement of Mr. Fox appears in the Appendix on
page 96.
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As you have heard and will hear from others today, with
such opportunity and growth comes the need to invest in
infrastructure. Economic growth means thousands of new people
are living and working in the region. Our highways are busier
and the once quiet towns are now bustling with activity. This
is the case in any part of the country with rapid population
and economic growth comes an increase in crime rates. From 2008
to 2012, the number of arrests in all crime categories in the
counties that fall within the Bakken region increased by 80
percent. From 2010 to 2013, the number of narcotics
investigations undertaken by the Montana Department of Justice
in Northeastern Montana increased by 281 percent. From 2008 to
2012, arrests for drugs and drug paraphernalia increased by
more than 300 percent. Earlier this year, one city police chief
in Northeastern Montana reported that domestic violence had
increased by 148 percent in the past 5 years; and the number of
attacks increased by 825 percent; and cases of drug abuse
increased by 785 percent. In 2010, it became clear to law
enforcement authorities in the region that much of the narcotic
trafficking was being conducted by national and international
criminal organizations including Mexican drug cartels. Their
presence throughout Northeastern Montana and Northwestern North
Dakota has become a commonplace. In 2010, in Northeastern
Montana, a gram of methamphetamine brought a street price of
around $100; an ounce sold for $500 to $600. Beginning in 2011
and continuing today, the price has continually increased.
Currently, a gram of meth brings $250 to $300; and an ounce
routinely sells for $2,800 to $3,000, and the area around
Sidney far exceeding national prices for these drugs. Their
quantity and purity indicate an origin in the Southern United
States and Mexico.
These are just a few of the statistics that make it clear
that law enforcement is and must continue to be a key part of
any investment in infrastructure. As Montana's Chief Law
Enforcement Administration Officer, the safety of our citizens
is paramount, my paramount duty. It is also the drive of more
than 800 public services of Montana Department of Justice who
work tirelessly in all corners of this State, often under
dangerous circumstances to protect their citizens. We take this
responsibility very seriously as do the city, county, tribal
and Federal law enforcement partners with whom we work on a
daily basis. Our legislature meets only for 90 days every other
year which gives State and local officials narrow windows of
time to pursue many of the avenues available for responding to
the growth in Eastern Montana. When I took office last year, it
was clear that the Department of Justice needed to invest more
resources in Eastern Montana. At the time, call response times
for highway patrol troopers were unacceptable with very long
durations. Our troopers were stretched too thin and were over-
burdened so much in the fact that retention had become an issue
with our ability to not only respond to calls in a timely
manner, but also assist local agencies in jeopardy.
We went to the 2013 legislature and asked for funding to
add additional troopers to our Eastern Montana detachments. We
were successful in acquiring five new troopers who are already
working in the field now. We also steered more resources to our
Division of Criminal Investigation which helps local and
Federal law enforcement agencies and tribal agencies as well
investigate complex crime--profiled violent crimes. From day
one of the 2013 Legislative Session, we worked to secure two
additional DCI agents for Eastern Montana. In the end, we were
successful, and much of that credit belongs to Governor Bullock
who was a former attorney general and he understands the law
enforcement challenges facing Eastern Montana.
Speaking of DCI, I am glad that Montana's U.S. Attorney,
Mike Cotter, is here today. Mike and his team work very hard to
prosecute Federal criminal cases throughout Montana. Our DCI
agents assist Mike's office in such cases on a regular basis.
It is an important and productive partnership that benefits
Montanans and we are committed to maintaining it. I also want
to mention that at Mike's suggestion, I am adding a budget item
in my budget the next legislature to secure another prosecutor
who will be solely responsible for Eastern Montana drug
prosecutions, and Mike has committed that should this person
have the right qualifications, and I am sure they will, that
this person would be designated as a Special Assistant U.S.
Attorney, and I think that will further our cooperation
collaboration.
Field work is just one aspect of law enforcement. At the
Department of Justice, we also operate the State Crime
Laboratory which processes the evidence that can make or break
successful prosecution facing a backlog created in part by
cases in Eastern Montana. Last year we increased staffing at
the lab in the key areas of forensic science. We also
successfully advanced legislation establishing a THC impairment
standard for driving under the influence (DUI) of marijuana as
well as a bill banning the popular designer drugs that mimic
dangerous illegal drugs.
To combat repeat DUI offenses, we are investing
considerable time and resources into expanding the 24/7
sobriety program, including two counties impacted by Bakken
growth. This has been a tremendously successful program that
holds repeat offenders accountable and saves tax payer money by
eliminating many incarceration costs. During the 2013
Legislative Session, we successfully advanced a bill changing
from 5 years to 10 the window to determine if an offender is
subject to the intent advanced enhanced criminal penalties and
driver license sanctions for a second or subsequent DUI
conviction.
Our Prosecution Services Bureau assists Montana's smaller
counties--including those impacted by the Bakken region, with
the toughest cases, our seasoned agents under the DIC, which I
mentioned previously, help county sheriff offices and City
police departments investigate the range of crimes that have
increased with population and economic growth in Eastern
Montana. I am excited to say that earlier this year with the
help of Federal money and forfeiture money, we launched a
Montana Highway Patrol's first ever K-9 Narcotic Units.
These six units are stationed in strategic locations along
major corridors that conduct drug interdiction operations
throughout Montana. This represents a significant advancement
in our ability to intercept drugs being trafficked through
Montana. We are also working very hard to raise awareness to
human trafficking, which is now taking place in the Bakken
region, and in the interest of time I am going to skip a little
bit more about that. In addition, we are training our officers
that come out of the Montana Law Enforcement Academy about
human trafficking and how to look for signs of human
trafficking. Just with one agency alone cannot fully address
the public safety challenges in the Bakken region. The public
sector alone will not suffice. A holistic approach requires
partnership with the companies operating in the region. To that
end, the Department of Justice has been working with the
Montana Petroleum Association and its members to explore ways
we could work together. For example, our agents have been
training human resource staff on how to identify red flags
during the screening process. Most of the people that come to
work in the Bakken are honest men and women who want to work
hard and earn a good living for themselves and their families,
yet we cannot deny that there are criminals and others with
nefarious intentions seeking employment as well. If we can work
together with these companies during the hiring process, we can
make big strides in helping prevent that element from gaining
access to the region.
My staff and I are more than happy to answer any questions
from you, Senator Tester, others in attendance here today,
again, I do appreciate the opportunity to be here and speak
with you and I want to personally say that you and your staff
have always been attentive and receptive to inquiries from my
office and I appreciate that very much.
Senator Tester. Well, thank you, Tim, and I appreciate you
being here today. Sheriff Anderson, last but not least, you are
up.
TESTIMONY OF HON. CRAIG ANDERSON,\1\ SHERIFF, DAWSON COUNTY,
MONTANA
Mr. Anderson. Well, good morning, Senator, and thank you
for the invitation to visit with you and I echo the Attorney
General's compliment to you and your staff. You have been very
responsive to our office and our county with our challenges. As
I sit here listening to everything, I could either chamber up a
shotgun shell and kind of scatter out a message, but I think I
would rather take my time and deliver a rightful shot, I
believe it is a warning shot and nobody's talking about it, it
is the stepchild of the justice system and it is called jail.
And to give you some background, in 1996 after two unsuccessful
GO Bonds in Dawson County, the good folks in Dawson County
passed a bond issue that was about $4.1 million and we built a
28-bed jail, and at the time we thought that capacity would
take us well into the future, and we woke up one morning with a
900-pound gorilla in our bedroom and it was called the Bakken
and all of a sudden our jail filled up. And prior to the
Bakken, our average daily production (AVP), in Dawson County
was about 12. Today, or last month, our average daily
population is 27. That's average. Now, we are sleeping people
on the floor, and our problem isn't unique to Dawson County. We
have undertaken a planning effort to expand, and we took a
snapshot of all the jails in Eastern Montana and Western North
Dakota. Williston, North Dakota's capacity is 132 bed, and
their AVP was 145; Richland County is at 26 beds, their AVP is
33; Roosevelt County has 17 beds, their AVP is 15; Rosebud
County has 26 beds, their AVP is 23; Valley County has 26 beds,
their AVP is 22. We have a problem. So last, about a year ago,
Dawson County Commissioners decided we would retain an
architectural firm and we are in the design phase, or the
conceptual phase, and right now the dollar amount that they are
projecting for us to expand is $9 million dollars. Dawson
County Commissioners chose to ask the Dawson County tax payers
to invest half of that in a GO Bond that will be on the ballet
in November for $4.5 million, and we need to find $4.5 million
because the good people of Dawson County, we solved our jail
problem, and what is being visited upon us and every other jail
in the region is not of our making, we could not foresee it, so
we are looking for help from the Federal Government, from the
State government, from other counties and we are going to
create some creative funding opportunities, but our taxpayers,
hopefully, will at least double that and invest half. Now, the
U.S. Attorney, Montana Attorney General, they can decide today
to put boots on the ground with badges and guns, and this is a
target rich environment, and when they start cuffing up people,
where are they going to take them? The inn is full. Now, we
could change our priorities and funding mechanisms and move
personnel on a dime, but nobody's talking about the fact that
if we need to recognize we have a jail shortage. We do not have
capacity. If we decide that we do not today and we have the
money, we are 24 to 36 months out before those jail beds come
on line.
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\1\ The prepared statement of Mr. Anderson appears in the Appendix
on page 100.
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So let me close with an analogy and a question. Why would a
farmer plant more grain than they have room in the bin to
store? And while our country has been dependent on foreign oil,
how much money have we spent as a country protecting oil
interests abroad? And I just raise the question on a
proportionate level, are we investing that same amount of money
to protect the people who are living in the Bakken region, and
with that Senator I'll close and I look forward to any
questions.
Senator Tester. Fair point, Sheriff. Thank you for your
testimony. I appreciate it very much. I am going to change the
format a little bit based off of your testimony since it is
fresh in my mind. You bring up a point--if we start arresting
folks, and the need is great out there, I think everybody kind
of accustomed to the fact; the percentages the Attorney General
brought up and the rest of the testimony, I would like to know
your view about our jail capacity, and I think I will put this
to Tim and to Mike Cotter. What is your perspective on that? Is
it an issue that we need to be dealing with in a proactive way?
Obviously, the Sheriff's dealing with it in a proactive way in
Dawson County, is it big enough we need to deal with it
statewide and from a Federal standpoint?
Mr. Fox. As I mentioned earlier in my testimony, Senator,
those who bear the greatest burden of the benefit that is
coming out of the Bakken I believe about to receive their share
back, and that will be part of the legislature's duty and the
Governor's duty in the next legislature; and I might add that
it is not just jails; it is victim's services; it is mental
health services; anything and everything related to the justice
system is overtaxed and overburdened here, and sheriff's become
very creative in moving people around, but every time you have
to take a prisoner to another jail or another county or
someplace else there's a day's worth of wages, someone whose
not there when the call for help is made, so you know, I can
not even begin to imagine the kind of stress this puts not only
on the sheriff's department, police department, others here
locally, but on the people, because as you get creative, one of
the things you start doing is releasing people you would rather
not release because you just do not have room for them. Another
thing you might do is you, you find an outstanding warrant, you
do not pick them up just because you have no place to put them;
so those are touch decisions for law enforcement, and you know
thatholistic approach that I was speaking about I think will be
very important. That's one of the reasons that I am exploring
something new and different which is putting together a task
force to identify the needs for law enforcement, first
responders, victim services and the like and setting up a
foundation for the companies who are benefiting from the Bakken
boom to be investing in so that money again also rolls around
or is more targeted to the individual needs that are necessary
here in these communities.
Senator Tester. Gotcha.
Mr. Fox. I hope that answers your question.
Senator Tester. It does. I mean I think basically you agree
there's a jail shortage, but there's also mental health
services and family services and other services that we are
short on, Tim, we are short, bingo. Mike Cotter, would you
address the jail issue if you could?
Mr. Cotter. I will, Senator, thank you very much. It is
obvious that when down in Sheriff Anderson's county when they
built that jail they did not anticipate that----
Senator Tester. Right.
Mr. Cotter [continuing]. They would ever need----
Senator Tester. Sure.
Mr. Cotter [continuing]. A larger jail. And I know that----
Senator Tester. And it is probably the same thing here in
Richland County, too. I mean you guys have a pretty new
facility, pretty recent, the same thing, so yes, go ahead.
Mr. Cotter. And with respect, we do not have a Federal
holding facility, we do not have a Federal prison in Montana,
but what the Marshal Service does once that goes into the
Federal system they are, the defendants, are housed in county
jails whether it is Yellowstone County, they are up in Shelby,
they are in Lewis and Clark County, and there is no doubt in my
mind that Sheriff Anderson probably has some Federal prisoners
in his jail as well or those that are arrested through the
efforts of the Montana Highway Patrol through interdiction,
couriers with drugs, that's where they wind up, and they
eventually get moved into the Federal system, and we do not
have a jail capacity here in the eastern part of the State.
Senator Tester. I got it.
Mr. Cotter. We do not.
Senator Tester. OK. Thanks. You might as well keep the mic,
Mike, we are going to go a little different way. We have a
little different area that's very important. You all spoke
about the prevalence of increased criminal activity and the
evolving nature of the crimes that are happening here in the
Bakken. From your perspective, from your work, what is the
primary criminal threat to the communities here if you could
talk about a primary? You might have to talk about more than
one, but----
Mr. Cotter. Well, there is more than one, Senator, and when
I started this job 5 years ago, methamphetamine was not
necessarily a big problem, but we are awash in meth----
Senator Tester. OK.
Mr. Cotter [continuing]. In Montana. We are also seeing
heroin, which is something we did not see 5 years ago; and the
other thing that we do see is violent crimes. My family is from
Miles City, and I have to tell that the 100 years that my
family lived in that community I do not think they ever locked
the door to their house, but violent crime is now here in
Eastern Montana, and this all came about and our focus was
brought to it with the Arnold murder.
Senator Tester. Right.
Mr. Cotter. And it was a wakeup call; and you know, people
choose to live in this part of the State because they enjoy it,
it is a good place to be, it is a good place to raise a family,
it is family oriented communities, but that is no longer with
the problems that have come in recently.
Senator Tester. So with the meth, excuse me, Mike, but with
the meth and the heroin and the violent crime, would you say
they are all attached at the hip?
Mr. Cotter. I would say yes they are. I picked up the
Billings Gazette today. There was a six pound meth bust
yesterday. The two men were complained to have been joined,
and, I am going to address the task force that created the
Project Safe Bakken and the work that has been done. I
mentioned one matter and that was the Armstrong case. The
partnerships that were created in that task force in order to
dismantle that drug trafficking organization, it involved
agents--and there were scores of law enforcement that were
involved. The DEA was involved, FBI was involved, Montana DCI,
Sidney Police Department, the border patrol, Sweetgrass County
Sheriff's Office and the Montana Highway Patrol, and we have
something good that is going on in terms of law enforcement
with respect to that task force and that is the only way that
we can address these issues.
Senator Tester. OK. Mike Gottlieb or Scott Vito, do you
have anything to add as to far as what you are seeing as the
primary criminal throughout here?
Mr. Gottlieb. I will defer to Montanans in terms of what
the most serious threat is locally, but I will say I think the
U.S. Attorney makes a fantastic point here, the consequences of
drug trafficking and what we are seeing in the Bakken region in
terms of not just the violence, but in terms of dangers on the
road, the public health consequences, and really as the Sheriff
mentioned, what it does to the fabric of our communities. I
think it shows that we need a strategy that's strong on law
enforcement, but it is also multifaceted and it needs to take
into consideration prevention efforts, mental health efforts,
public health efforts, and that's what we are trying to push
here with the Northern Border Counternarcotics Strategy and the
National Drug Control Strategy, and that's a balanced approach,
and we commend you all in this region for your efforts in that
regard.
Senator Tester. Scott, anything to add?
Mr. Vito. I would say methamphetamine, drug crimes and the
violent criminals associated with that trafficking in the
Bakken area as well as across the State. You see in Billings
the large scale methamphetamine seizures, those are destined to
the Bakken, but they are also being distributed in Billings and
Bozeman and Helena and those places, so the methamphetamine
trafficking being brought into the Bakken tends to have a
spillover affect into both North Dakota and Montana in the
larger picture.
Senator Tester. OK. And you might as well keep the mic,
Scott, and anybody can add to your answer, is there, and I do
not want to get into profiling, but is there a profile that you
are looking at or is it--as far as the criminals, or is it
across the board?
Mr. Vito. It is pretty much across the board. It is
economics really and General Fox mentioned you can buy an ounce
of methamphetamine in California for $300 and you can bring it
to the Bakken and sell it for $3,000, you are always going to
have that flow into the area, and so our efforts to address
that is pretty much what we have always done in the criminal
investigative field. We work those cases and we try to expand
it and go back and stop the suppliers so that larger source or
supply doesn't make it into the Bakken.
Senator Tester. OK. Do the rest of you feel the same way
that it is pretty much across the board. OK. And this is for
anybody that wants to answer it and multiple if you would like,
we hear a lot about organized crime. I had a listening session
up in Poplar a month ago and we heard about organized crimes
existence here and how there's no separation. Could you talk
about the extent of organized crime that is in this region? And
it doesn't matter, whoever wants to talk. You have the mic,
Scott, so you can hand it off or keep it.
Mr. Vito. Sure. And again, we go back to the economics of
criminal activity. Any large scale market for those things such
as drugs would draw those elements in. We have seen an increase
in connections to Mexican drug trafficking organizations coming
into the Bakken directly through the State of Montana and other
trafficking routes, so it is not just the guy on the street
selling a rock of crack or an ounce of methamphetamine. It is a
larger scale----
Senator Tester. So without giving away any trade secrets
here, is it flowing from the Mexican border up here or is it
flowing to Canada, Mexico to Canada and back through, how's it
getting here?
Mr. Vito. I would say Mexican border. That is the most
prevalent route.
Senator Tester. OK.
Mr. Vito. Through California.
Mr. Cotter. Senator, I will give an example of a case that
was prosecuted in 2013 in Billings by the U.S. Attorneys'
Office. It was a case that came through the work of DEA,
Montana DCI and Billings PD. The defendants were Alvarado and
Martinez. They were members of the Sinaloa Cartel. They were in
Montana for a period of only 6 months. At sentencing, they
admitted to moving 80 to 90 pounds of meth, pure meth, into
Montana toward the Bakken. In the debriefing, they admitted to
400 pounds. At the time of the arrest, they had $56,000 cash, 2
pounds of coke; 6 pounds of meth; 100 grams of heroin; 17 guns
were seized, two of which were SKS assault style weapons; and
it is estimated that 175 weapons were traded for drugs and
those weapons did go south. These men were connected to high
levels of the Sinaloa Cartel, so you know we have big City
problems in Montana.
Senator Tester. OK.
Mr. Cotter. It is not what it used to be.
Senator Tester. Pass the mic all the way down to the end to
Sheriff Anderson. Sheriff, you have been in your position for,
just a say a number of years, and you have seen the challenges
that your law enforcement agency had. Could you talk about what
the changes have been over the last 10 years, pre-Bakken to
today, what are your officers seeing that disturbs you?
Mr. Anderson. Obviously, the drugs and the outside
influence and the economic opportunity that the Bakken creates
with workers that have high wages and--but collateral to that,
increased domestic violence calls, and those are the most
dangerous calls for law enforcement to respond to.
Interestingly enough, Highway 16, we were running into some
road rage issues. Prior to the Attorney General diverting
troopers out here, we were having some horrific accidents,
head-ons, that were really hard on first responders and law
enforcement, so a pretty significant uptick in that area. As I
think about it, thefts of copper. These methamphetamine users
that are addicted are stealing a lot of copper and so we are
seeing an increase there, but you know I could prattle on but
there's a brief stamp job for yes.
Senator Tester. That's good. Attorney General Fox, in your
testimony you talked about working with Montana Petroleum
Association. I applaud that effort by the way, because I think
if we can cutoff demand it really helps the situation, and if
you can get those folks to work with your office and other
offices or give them the tools. Can you just talk about how
long the relationship has been going on, what's the receptivity
of it, is there anything that the folks at the table that
sitting with you or I or the Governor's office that can do to
help kind of forge a partnership that would----
Mr. Fox. Sure. I started this discussion with the Petroleum
Association, Dave Gold, last year.
Senator Tester. Yep.
Mr. Fox. My experience in the private sector has been that
when the public agencies and private individuals and companies
put their heads together good things can come of it, so I am a
big fan of public/private collaborations and partnerships, and
you know we see various things that these companies who are
working here and benefiting from the Bakken do for their
communities, and they are usually very community oriented. They
want to be a part of the community, and tapping into that
mentality I thought that what a great opportunity for a public/
private partnership in a big way to get the kinds of resources
directed to those who need them. Of course, as Montana's Chief
Law Enforcement Officer, my primary concern is public safety,
and so my vision on this, and I have already discussed it with
the NDA and several other members and there are people who are
ready to write checks, but my vision is is that it is the local
folks who need to drive the understanding of what the needs
are, so that's why I intend to put together a task force who
would then identify those needs and then a foundation, because
it is always good to have a tax write-off, for the oil
companies and oilfield service companies and others to
contribute to and then have that money flow directly back here.
We would have a very defined geographical area envisioned for
the foundation such as law enforcement, victim services, first
responders----
Senator Tester. Yes.
Mr. Fox [continuing]. And the like.
Senator Tester. Are there tools that you can give them that
they can utilize during the interview process and hiring
process that might be able to----
Mr. Fox. Right. We have offered that, and to my knowledge
we have not had our first training yet but we are setting it
up.
Senator Tester. OK, good.
Mr. Fox. We want to make sure that, again, we partner on
those things to help them make sure they are hiring folks that
are not going to be a problem. That's good business.
Senator Tester. Yes, exactly right. That is good business.
The next two questions are for--are for Mike Gottlieb and Scott
Vito and it is about jurisdictional lines of both your
respective agencies, the FBI and the DEA, and I have noticed
that the Bakken was split at the North Dakota border with
Montana. As a result, and correct me if I am wrong if it is
been changed, but Sidney's jurisdiction is in Denver;
Williston's jurisdiction is in St. Louis, and Mike Gottlieb
this is for you. Are those jurisdictional boundaries an
impediment from your perspective?
Mr. Gottlieb. I think what you are referring to, Senator,
are the High-Intensity Drug Trafficking areas that--
Senator Tester. Yes, that's correct.
Mr. Gottlieb. So you are absolutely right. The State of
Montana falls into the Rocky Mountain HIDTA, which is Montana,
Wyoming, Colorado, Utah; and North Dakota falls within the
Midwest HIDTA, which is based in Kansas City and includes a
number of States in the Midwest.
Senator Tester. Right.
Mr. Gottlieb. And I do not believe that poses an impediment
whatsoever. I think what we have seen and we have learned at
ONDCP really is, and I think it is certainly true in the
Bakken, is that no one agency, no one level of government, no
one State is going to be able to solve these types of issues,
and I would think the HIDTA Program and the emphasis it places
on cooperation and collaboration is essential, and the folks in
the Bakken, both in North Dakota and Montana, have shown not
just a willingness to do that, but actually a demonstrated
commitment to work together. I know the U.S. Attorney in
Montana works very closely with his counterpart in North
Dakota, and we see those two HIDTAs, both the Rocky Mountain
HIDTA and the Midwest HIDTA working together on a regular basis
so we are very pleased with that.
Senator Tester. So you are not getting conflicting
direction from St. Louis or Denver?
Mr. Gottlieb. No, we are not; and in fact, I mean although
it is actually Kansas City and Denver is where the management
offices would be for those particular HIDTAs.
Senator Tester. Right.
Mr. Gottlieb. But in both cases it's local control.
Senator Tester. OK.
Mr. Gottlieb. I mean it is really an effort governed by
folks in Montana and North Dakota to work collaboratively, and
the direction's not coming from Washington, D.C., Kansas City,
or Denver in terms of how to operate.
Senator Tester. I got you, and I have talked to FBI
Director Comey, and I would ask you the same question, but he
gave me the same answer that doesn't matter; that border
doesn't matter; the region doesn't matter; that it is seamless.
Mr. Vito. That's correct. That's how we look at it. The
task force approach working with State, local and tribal
partners bringing everyone to the table. There's so few in
Eastern Montana and Western North Dakota that we all have to
work together to get the job done so----
Senator Tester. That's good. And of course you know, I know
we have a staff member from Hoeven's office here, I hope he's
still here, yes, he's still here. I just want to make sure that
I put a lot of pressure and make sure those FBI agents came to
Montana and not to North Dakota, but no, just kidding.
[Laughter.]
The fact is is that the problem is there in North Dakota as
well as Montana and it is a serious problem. Scott, could you
talk about, I do not know what's going on as far as staffing in
North Dakota, but I do know that, and we talked about it
literally before this hearing started, about the term that the
person's here, how long they are here. Is there any plans to
extend on a regular basis the staffing here in Eastern Montana
by FBI agents?
Mr. Vito. Right. We have been staffing probably 60 to 90
day TDY's over the course of the last year.
Senator Tester. Wait, say that one more time.
Mr. Vito. Sixty to 90 day TDY's over the course of the last
year. Moving forward from probably, hopefully, November time
period we are going to be looking to a 12 to 18-month TDY time
period.
Senator Tester. OK.
Mr. Vito. That will allow more continuity and more cases to
be developed, and longer termed cases.
Senator Tester. OK. That's good. And can you talk about,
and maybe you can and maybe you can not, can you talk about the
FBI's long-term plan for agents in this region, and I am
talking about North Dakota and Montana. Do they have plans to
put more agents into this area?
Mr. Vito. Right. The process is ongoing as I am sure you
are well aware after talking to Director Comey. Both sides will
have agents working the crime problem. We do not know exactly
how many and where yet, but it is definitely a commitment from
the FBI to maintain agents in the Bakken region.
Senator Tester. And you do a regular assessment on need I
would assume?
Mr. Vito. We do.
Senator Tester. And do you bring in local law enforcement
when you do that assessment and highway patrol and let me put
it this way, do you bring in all your collaborators when you do
that assessment?
Mr. Vito. Right, absolutely. We engage in conversation with
all of our partner agencies in the area.
Senator Tester. Are the Tribes a part of that, too?
Mr. Vito. They are.
Senator Tester. OK. Thank you very much. Just hang on here
for a second. Mike Cotter, I want you to talk a little bit
about, it was touched on I think by Mike Gottlieb, I want you
to talk a little bit about your coordination efforts with your
counterpart in North Dakota when it comes to meth, heroin,
violent crimes. Are you able to connect up with those folks and
have regular conversation? Is that something that you do or is
it something that you do only when it looks like it's
absolutely necessary. I just kind of want to get the idea on
what kind of communication is going between the U.S. Attorney
Offices in the respective States.
Mr. Cotter. I have Purdon on speed dial.
Senator Tester. You have what now?
Mr. Cotter. I have Tim Purdon on speed dial. [Laughter.]
He is very accessible as am I to him. So we speak often on
various issues whether it is Bakken or Indian Country or
anything along those lines or border issues, but I think the
sharing of intelligence under the umbrella project Safe Bakken
between North Dakota and Montana through the, like in Montana
schematic, and through Montana DCI and through its counterpart
in North Dakota, the Bureau of Criminal Investigation, as well
as the sharing of intelligence between FBI on both sides, DEA
on both sides, ATF----
Senator Tester. Yes.
Mr. Cotter. It is ongoing. And I can tell you, Senator,
that there are agents from Montana who are members of the
Bureau, members of ATF, and members of the DEA that actually
operate in North Dakota; they do.
Senator Tester. OK.
Mr. Cotter. And it's to get the job done.
Senator Tester. Good. Project Safe Bakken included a grant
and I will get this title right, ``Special Assistant United
States Attorney for Fort Peck''.
Mr. Cotter. Correct. That's is from the Office on Violence
Against Women (OVW).
Senator Tester. Right.
Mr. Cotter. Office on Violence Against Women, yes. The same
is true for Fort Berthold.
Senator Tester. OK. And so basically this would be a tribal
prosecutor----
Mr. Cotter. Yes.
Senator Tester [continuing]. To Federal crimes on the
Reservation done by your office, right?
Mr. Cotter. Well, that's correct, but that individually
will also be a tribal prosecutor who will prosecute cases in
Tribal Court if there is an event or a case where it would get
prosecuted in Federal court.
Senator Tester. Is that person currently hired?
Mr. Cotter. The position has been posted but not yet
filled. There is also one over at----
Senator Tester. Fort Berthold?
Mr. Cotter. Yes.
Senator Tester. And so the person has already been hired?
Are they currently working? I mean they are there?
Mr. Cotter. Yes, they are.
Senator Tester. Well, that's good news then. Who is it? Can
you tell me who it is?
Mr. Cotter. I do not recall the young man's name, sorry.
Senator Tester. All right, sounds good. This is for Mike
Gottlieb. I don't think this is a fair comparison, but I am
going to ask the question anyway, can you talk about the
differences in anti-trafficking operations between the U.S.
Canadian border and the U.S. Mexican border?
Mr. Gottlieb. I think, and it is a tricky question, I think
the concept remains the same. I think the key is cooperation
between the U.S. Government and our law enforcement officials
and folks in Canada and folks in Mexico, and what I can comment
on specifically are our collaboration, our partnership with our
Canadian partners because I think that's essential for where we
sit today and we could not be more pleased. I think the
T3National Northern Border Counternarcotics Strategy, T1 sets
forth a whole number of action items and a whole number of ways
which we in the United States collaborate with our Canadian
partners both in terms of integrated border activities, in
terms of shared personnel, so we think the concepts remain the
same and are very pleased with our partnership with the
Canadians. In terms of drug trafficking, I think as Mr. Vito
said, some of it varies in terms of where drugs are coming
from, dependingon what particular substances and whether they
are trafficked across the Southern border or whether they are
trafficked from the Northern border down into the United
States, and I defer to Scott on those particular issues, but
the general concepts remain the same and the key is
partnership.
Senator Tester. OK, good, thank you. This is a question for
Cotter and Fox and will probably be the last one. We will go to
Tim Fox, Attorney General. What are the most pressing needs for
prosecutors and aid workers in the Bakken to be able to most
effectively address the sexual violence issue?
Mr. Fox. Address what? I'm sorry.
Senator Tester. Domestic and sexual violence issues.
Mr. Fox. Well, we have identified a number of things in our
office, and I know that the U.S. Attorney's Office has as well
back to the Department of Justice. We believe that training is
paramount. How do I say it? There are some old mindsets about
how these cases should be investigated and prosecuted, and I
think what we have been proactive in is traveling around and
doing training for county attorneys and deputy county attorneys
on how to successfully investigate and prosecute a sexual
assault case. I also believe that more resources for victim
services are absolutely imperative, and there's a shortfall and
always has been in victim services, and we need to make sure
there are more professional resources available there for all
victims of crime, but in particular sexual assault, domestic
abuse and those kinds of things. One of the things that we are
going to ask the legislature to do in this next session is
designate within our Prosecution Services Bureau a Sexual
Assault Prosecution Unit. We have those kinds of units for
other types of crimes. We have seen I think such a need here in
Montana and across the Nation for those kinds of services and
that type of training and the right personnel that we want to
make it a priority at the Department of Justice; and really
quickly if I can say I anticipated a question that you didn't
ask.
You asked the last panel, you know, what are your greatest
needs and your top priorities; from our perspective from the
Federal Government, more resources for the FBI and U.S.
Attorney's Office in particular. I think we need additional
prosecutors, and I hope Mike would agree with me in his office.
We certainly do need those FBI agents. I think it would be best
stationed here in Sidney. That's where they have been. They
have worked hard here we want to see that continue.
And then last, Senator, you and I and our offices have
worked on the penalizing that we get, particularly with Federal
funds to go to our drug task forces.
Senator Tester. Yes.
Mr. Fox. We get penalized under the Sex Offender
Registration Notification Act (SORNA), under the Prison Rape
Elimination Act (PRETA), and under the National Institute for
Background Check System (NICS). All of those penalties, if they
are assessed this year or the next fiscal year will amount to
about $120,000 to money that will not go to our drug task
forces. Our local agencies are strapped; they need the help. If
there's a way to have a moratorium on those penalties, Senator,
we would sure appreciate it.
Senator Tester. Amen to that, Attorney General. I
appreciate you bringing those points up. It is very important,
and you know as well as I do the kind of services your office
offers and every one of these costs money. It doesn't happen by
accident. It happens with vision and you got to have some
resources, so I appreciate you bringing that point up, but I'm
sure Cotter will disagree. [Laughter.]
No, I know he won't; but let's get back to the pressing
need for prosecutors and aid workers when it comes to domestic
and sexual violence, if you could touch on that, and then if
you want to respond to the Attorney General you sure may.
Mr. Cotter. Thank you, Senator. With respect to sexual
assault and domestic violence, jurisdictionally, those matters
fall to us if they occur on Tribal lands or in Indian Country,
and we are within my office we are sufficient number of aides
because we have an aide assigned to each Reservation to handle
matters. We have victim/witness people in our office. The FBI
has victim/witness specialists who work with victims until the
case is indicted and comes to our office. The BIA is also
involved and tribal police. On each of our Reservations, we
have child protective teams that meet, SART teams as well as
NDT; those are a group of professionals; law enforcement,
lawyers, county attorneys as well as healthcare providers who
identify people who are either in terms of need or help or
perhaps victims of assaults. If an assault occurs off tribal
lands, it becomes a county matter that has to be dealt with by
local county attorneys with perhaps assistance from the Montana
Attorney General.
Senator Tester. Right.
Mr. Cotter. There was this struggle that we have, quite
honestly, with respect to staffing. It was during the period of
sequestration. We were down a number of attorneys. Today, I can
tell you we are allocated 26 FTEs, we have 25 on board.
Senator Tester. Yes.
Mr. Cotter. We certainly are keeping pace with prosecutions
as they are coming forward. I believe that in the next 12
months, I have made this statement publically and I will make
it again, I have learned that drugs or narcotics cases will be
coming into our office, specific of the Bakken. We will
probably incite 100 individuals in the next 12 months, maybe
125. That's not to say that if I was offered another FTE I
would take it.
Senator Tester. Yes.
Mr. Cotter. And I would also add a staff person to also
help.
Senator Tester. Yes. Well, thank you and thank you all for
your testimony. Thank you for your correct answers to the
questions. I very much appreciate the work you do. You guys
have an incredibly tough job on all levels, and the fact is
that I think that you have touched on the synergy that happens,
and we have touched on some of the things that we are lacking,
whether it's jails, whether there's a number of things, but the
truth is, is that you guys do a great job and I just want to
thank you for the work that you do. Every one of you have
stepped up to the plate and done a job that we all could be
proud of as policymakers, so thank you all very much and thanks
for your time today.
Mr. Cotter. Thank you, Senator.
Senator Tester. You bet; thanks, Mike. And as this panel is
dismissed, we are going to go to our final panel of the day
which includes Tony Preite from the USDA; Mike Tooley from the
Department of Transportation; John Dynneson from the Richland
County Sheriff's Office; Paul Groshart, Richland County Housing
Authority; and Commissioner Loren Young from Richland County,
if you guys would kind of meander your way up.
Senator Tester. So the last Panel if we could get the folks
to come on up and I want to thank you guys for waiting around.
We are saving the best for last here, obviously. It is pretty
tough to beat the last two panels, but you guys will do just
fine. This panel will speak about infrastructure challenges
that have arisen for the explosion in the Bakken.
Infrastructure covers a lot of different things and we have a
lot of different perspective up here. First we have Tony Preite
who is State Director of the Montana Rural Development Program
for the Montana USDA. In that capacity, he oversees that
office's grants and loan programs and coordinates with State
and local officials on infrastructure and economic development
projects important to Montana. Tony has an incredible
experience in economic development in Montana. No one can quite
do what he's done because he's been at it a while, more than 50
years serving the State in various roles including a period
with the U.S. Department of Commerce; the Montana Department of
Commerce; and Bearpaw Development in Havre, Montana. Thank you,
Tony. We look forward to your testimony.
We also have Mike Tooley who is Director of the Montana
Department of Transportation (MDT). He serves on the U.S.
Department of Transportation National Freight Advisory
Committee. Prior to taking the helm at the Montana Department
of Transportation, Mike served the Montana Highway Patrol for
28 years, including four as Colonel. Mike, thank you for your
service, thank you for being here today.
We have John Dynneson. Is that correct, John?
Mr. Dynneson. That's correct.
Senator Tester. Did I get you right? He's the Deputy
Sheriff with Richland County Sheriff's Office here in Sidney.
He also serves as coroner for Richland County and is president
of the Richland County Law Enforcement Association. Previously,
John worked approximately 25 years with the Sidney Police
Department. He is also involved with various groups within the
community including Richland County Coalition Against Domestic
Violence and the Foundation ofCommunity Care. John, thank you
for taking the time to be with us today.
Mr. Dynneson. Thank you, Senator.
Senator Tester. Paul Groshart is the Executive Director of
the Richland County Housing Authority. You have a big job. It
was created in 1950. It is the largest affordable housing
provider in Eastern Montana. Paul first worked on affordable
housing in 1986. He has served as president of the Montana
Association of Housing and Rehabilitation Organization and was
a trustee of the Public Housing Authority Directors
Association. He served as a member of the Sidney City Council
for 8 years and was council president for two of those years. I
want to thank you for being here today, Paul.
And finally, Loren Young, Commissioner of Richland County.
Among his priorities as chairman is addressing the counties
infrastructure needs, particular affordable housing. We
appreciate that. Loren has served on numerous boards and
committees in Richland County prior to running for his seat as
commissioner including the Montana Oil, Gas and Coal Counties
Board. Loren is a fourth generation agricultural producer
farming for over 40 years with his farmer, with his father, and
now with his son. Congratulations on that. And, Loren, I
understand you got harvest done. That's always a good feeling.
It's good to have you here.
Mr. Young. Back down to normal now.
Senator Tester. There you go. Tony Preite, you have the
floor.
TESTIMONY OF ANTHONY PREITE,\1\ STATE DIRECTOR, UNITED STATES
DEPARTMENT OF AGRICULTURE, MONTANA OFFICE OF RURAL MONTANA
Mr. Preite. Thank you, Senator Tester. I am pleased to have
the opportunity to discuss the Bakken and the work of my
agency, USDA Rural Development. First, I would like to express
my appreciation to you for continuing to focus on the
challenges and opportunities that oil and gas development have
provided to rural Northeastern Montana and Western North
Dakota. For most of my career I have studied the needs in
economic development of State and local economies. While
activity in the Bakken has created much needed jobs in a region
that has been long underserved, it has also brought additional
challenges to the area. The sense of excitement about the
energy boom has today been replaced with deep and intense
conversations about issues of housing, traffic, crime, water
and waste and other social needs. USDA Rural Development
Programs play a key role in investing in rural economies. Rural
development staff and programs help deliver safe and affordable
housing, support for business growth, community facilities for
health and safety, reliable electricity for our homes and
industry, broadband to expand the access to education,
healthcare, businesses and social services and clean, safe
water to support healthy rural communities. The USDA Rural
Development has a nationwide loan for over $200 billion in
direct and guaranteed loans. Continued investment in key
infrastructure is essential to ensuring rural America is a
place where families and business can grow and thrive. Since
2009, USDA Rural Development in Montana has invested more than
$37,500,000 in single family housing in the Bakken area.
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\1\ The prepared statement of Mr. Preite appears in the Appendix on
page 102.
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Over that same period in the Bakken counties in Montana and
North Dakota, USDA Rural Development has supported 22 new or
improved broadband service projects for residents, schools,
hospitals and businesses. We have funded 27 water and waste
water projects and provided grants and loans to assist 60 small
and midsize businesses. Local development corporations and
cooperatives in the region have also been served. Thanks to the
new tools in the 2014 Farm Bill aimed at improving program
delivery, we will be able to continue to build on these
investments. Over the course of the last 2 years, USDA Rural
Development has participated in numerous meetings with local,
State and tribal leaders. We have tried to maintain a leading
role in planning and development sessions with community
organizations and engaged in listening sessions throughout the
region. These interactions make clear that technical
assistance, coordination and community outreach are key in
meeting the overall needs in the area.
That is why USDA Rural Development has worked to deliver
programs that ensure that taxpayers' dollars make the greatest
impact. A focus on community economic development while using
the regional strategy is our goal like in the Bakken. We can
develop important sources of growth and help extend limited
resources in the region by providing a set aside with
preference for projects that are part of a regional approach as
described in the 2014 Farm Bill, USDA Rural Development will be
able to more effectively support rural places that are working
in a cooperative effort to realize the long-term community and
economic development goals.
In Montana, USDA Rural Development has played a lead role
in the formation of the Eastern Montana Coalition, a cohesive
area-wide planning organization in the Bakken. The benefits of
this Coalition are numerous including better service throughout
the entire area, and the Coalition also provides a unified
force and voice for the region, especially when approaching
State and Federal leaders for assistance. As the Montana
Director for Rural Development, I am committed to ensure that
USDA Rural Development will continue to serve a leadership role
in the Bakken. We also recognize the importance and fully
support the participation and help of all other partners and
efforts to better serve the region.
Mr. Chairman, I appreciate your continued support for
providing assistance to the Bakken area. USDA Rural Development
joins you in your efforts to ensure that the residents of the
Bakken are well-served. I hope I have provided you with some
insight as to how USDA Rural Development has and continues to
contribute to the Bakken, and I look forward to responding to
any questions. Thank you.
Senator Tester. Tony, thank you for your testimony, thank
you for your insight. Mike Tooley, you are up.
TESTIMONY OF MIKE TOOLEY,\1\ DIRECTOR, MONTANA DEPARTMENT OF
TRANSPORTATION
Mr. Tooleey. Mr. Chairman, good morning. Thank you for
being here today and thank you for asking me to testify before
the Committee and before you. I think it is terrific that you
are here to hold this field hearing and outreach session in
Montana's active Bakken region. It has obviously made a big
difference in how the Montana Department of Transportation does
business. Our focus is to provide safe and efficient
transportation to the motoring public and to support economic
activity here in the Bakken, but for as it is almost always the
case for any infrastructure agency, our needs vastly outpace
the resources that are available, so it is essential that we
are making the best most timely decisions. To provide some
scale to the issue, our MDT own infrastructure of 12,000 road
miles in the State of Montana.
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\1\ The prepared statement of Mr. Tooley appears in the Appendix on
page 107.
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Nearly 30 percent of that is within the Bakken region in
the Glendive district. The numbers that I am going to give you,
Chairman, are related only to MDT owned infrastructure, and
please be aware that there are also major impacts to local
streets and county infrastructure. What have we seen? We have
seen a significant increase in traffic volumes largely made up
of heavy truck traffic. We have seen the increase in truck
traffic as much as 32 percent between 2007 and now. Pavement
designs are largely driven by the heavy truck traffic and this
kind of an increase can drastically impact the life and
condition of pavement. As a matter of fact, as part of the
Bakken Impact Study that we finished in 2012, we determined
that the MDT District 4, which we are in today, has an
estimated additional $52 million dollars in annual need over
the next 20 years to address pavement distress.
That is just our infrastructure. In addition to pavement,
the increased volumes of high truck traffic also have impacts
on roadway operations and safety and I will address some of
those things that we have done to address those shortly. We
have also had a hard time in the Bakken attracting and
retaining employees and contractors in this district. While on
a statewide, State employee basis, this may not be an issue;
unfortunately, I am the exception. I employ a large number of
truck drivers that have CDLs; I employ mechanics; I employ
welders and they are all very attractive to the oil patch. As a
matter of fact, I have seen a statistic that says that they are
hiring up to 30 CDL holders a week, and one of the first places
they will come is where somebody has a CDL already, and
unfortunately, that may be one of my snowplow drivers and that
becomes an impact to the community.
Once we have trained and hired staff, they can easily move
on to better paying jobs in the oil development industry. One
of the things that we are doing to address that is workforce
development through tribal colleges, and specifically on the
Flathead Reservation and Fort Peck Community College, MDT does
provide grants that trains individuals to hold jobs in our
agency or in that type of line of work. We think it is
important to develop those technical skills and keep those
workers working right here in the Bakken in a place that they
will probably stay. Increased competition, however, isn't
limited just to our staff, but it also includes raw materials
and private engineering and construction services. We have seen
a massive increase for key materials which drive up the project
costs or decreases the buying power that we have in comparison
to other districts. We have had instances where prime
contractors have come out here to work. We see few or no bids
from contractors or subcontractors for highway projects due to
the increased demand in the area; and so now the prime
contractors have to bring more of their staff in instead of
hiring a subcontractor increasing immobilization costs and the
entire project costs more. It is important because we want to
make the right decisions and continue to invest in
infrastructure across the State. Connectivity for us is
important. We don't want to have one district have great roads;
the next one not have good roads. It is very important and
through the process that we use, we use the Performing Program
Process to manage our assets and that allows MDT to make
appropriate investment decisions, and this process directs the
longer term direction of investment for MDT. And in fact, some
of the recent P-3 recommendations are directing more funding to
this district for system improvements. And in response to
increased truck traffic, our agency was able to modify pavement
design in several recent and upcoming projects to make sure
that they last longer and accommodate the added truck traffic.
Studies show that both short term and easily implemented
improvement projects and long-term needs are there. We have
identified some easily implemented improvements that address or
head-off some emerging issues, and in this area specifically we
did a quarter study on Montana 16/200, Glendive to Fairview. It
was a 60-mile study along with a safety audit that caused us to
take some immediate action including installing some passing
lanes that might not have been the original design; installing
centerline rumble strips; and increasing the shoulder widths.
We also, as part of the Safety Study, determined that we needed
to normalize or match the speed limits in that quarter between
passenger vehicles and trucks, and so now the entire quarter
has the same speed limit no matter what you are driving, and I
think that has contributed greatly to safety.
In addition to short-term improvements, MDT's district
staff has identified many projects to address area needs. Right
now on the books we have over 100 miles of recently completed
and planned projects in the Glendive district through 2019 for
a total investment of about $50 million dollars. Many of these
investments are influenced by the energy impacts. However, the
most responsive aspects of our program is in maintenance, and
we have recognized need to invest more State funds in that area
and $6 million more that could have previously been allocated
to other districts is now coming to the Glendive district to
address that; however, our efforts extend beyond highways. We
fund law enforcement for overtime patrols to arrest DUI
drivers, and we also work with other outside entities such as
Burlington Northern Santa Fe Railroad. We are investing $5
million dollars in this area to upgrade rail crossings. That
includes installing stop signs, flashing lights and new
crossbuck for $5 million dollars. We also pay very much
attention to air transportation through the essential air
service. We have seen a 27 percent increase in air traffic and
air travel in this region thanks to the Bakken. I heard
Chairman Stafne speak to folks that can't get around, and we
invest $6.5 million dollars per year statewide in transit to
make sure that folks who may not have their own transportation
have those needs met.
To close, we anticipate the impact in the Bakken to
continue for at least two more decades and recognize that
additional funding and attention to our infrastructure is
necessary. To maintain the condition and operation of our
systems, we feel that funding levels must at least remain where
they are with impacts for inflation. Montana's transportation
infrastructure is dependent on the continued and predictable
Federal participation and a strong Federal investment in the
Nation's transportation systems. These Federal programs are
essential for our economy. In Montana, $0.87 of every
construction project is federally funded. Supporting the
industry, the jobs and the growth in the Bakken and ensuring
the Nation is poised to capitalize on the investments here are
important and that requires Federal participation, and I again
would just like to say thank you for the opportunity to testify
before you today. Your staff has been extremely good to work
with. I understand that we may not see you every day, but I
know you are involved behind the scenes in Washington and thank
you for all you do.
Senator Tester. Thanks, Mike, appreciate your testimony.
John Dynneson.
TESTIMONY OF JOHN DYNNESON,\1\ DEPUTY SHERIFF, RICHLAND COUNTY
SHERIFF'S DEPARTMENT
Mr. Dynneson. Yes. Thank you, Senator. Prior to being on
the third panel today sitting here listening to the other
testimony, it's obvious that the testimony I provide to you
much of that information has already been presented; however,
there are a few points that I would like to address. A common
theme echoed by many in this region is the need for an increase
and experienced staff and staff that is able to afford the
living situation in this region long enough to stay and obtain
the necessary experience to effectively serve our communities.
Though our sheriff's office and local police departments have
had some outstanding individuals willing to serve our continued
commitment to effectively serve our communities require more
officers, jail staff and dispatchers. These are only just a few
of employment opportunities available and necessary to
facilitate the work our law enforcement agencies are expected
to undertake and provide. Finding individuals willing to work
in these areas rather than seek higher paying oilfield
employment is difficult.
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\1\ The prepared statement of Mr. Dynneson appears in the Appendix
on page 110.
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Besides finding an experience person and locating others
willing and able to dedicate adequate time to train persons,
multiple obstacles still stand in the way. Housing
infrastructure--though slowly increasing--is still lagging.
Increased construction of housing units does not remedy the
issue of affordable housing. With housing prices at alarming
rate in this region in relation to comparable housing in other
parts of the country, our local agencies and departments are
faced with budget concerns and the need to provide further
monetary assistance or housing subsidies to address those needs
of prospective and existing personnel. It is not only the high
cost of living or the high cost of housing that is astonishes
the people, but everything here is limited and comes with a
price. The costs associated with living in the region including
groceries, home repairs, vehicle maintenance and childcare, are
unprecedented compared to many areas of the Unites States and
our State. What the State and Federal Government may not see is
that adequate childcare is extremely limited here in the
region. Enticing the right recruits to join our local agencies
is difficult. It is difficult enough without mentioning all the
accompanying hardships that those potential employees may face
for themselves as well as their families. Logically, the
increase in population comes with a growth in crime.
Increased incidences of abuse, mental health concerns,
growing numbers of homeless and other strains on local
infrastructures as well as other unsavory ideas such as
organizations coming to this area that support criminal
activity. Currently, all of our local State agencies work
together to address the impacts on our communities. These
agencies include Mental Health, Child and Family Services,
Sidney Health Center, Richland County Coalition Against
Domestic Violence and other service agencies. All of these
agencies are affected by the same issues as law enforcement;
concerns with affordable housing and the lack of experienced
personnel willing and able to live and work in the area of the
Bakken region and the lack of childcare.
In regards to Federal agencies, I want to express our need
that we need the assistance of the FBI here because the FBI has
the time and the resources that are necessary to devote to the
particular crimes of high-profile cases that the local and
county law enforcement agencies cannot match at this time.
Currently, the FBI rotates agents through this region based on
temporary duty. From my observations, I believe that it would
be helpful if FBI personnel were assigned to this region as a
permanent position. Though our local and State officials
continue to do a great job in their work in this region, the
permanent FBI official would provide much needed assistance to
the cities and counties in Eastern Montana. Besides assisting
local law enforcement, the FBI officials would be expected to
proactively investigate, assist in prosecuting Federal crimes
that are committed in this area. This would primarily consist
of but not limited to the drug investigations, human
trafficking and white-collar crime. If permanent officials were
assigned here, it would like require a Federal stipend or some
type of assistance to deal with the high cost of living to this
region. In addition to the FBI and other Federal agencies, may
require financial and personal increases in order to
effectively serve the Bakken area. It may not be necessary for
those dedicated personnel to be stationed in our city or in our
or county rather; however, setting up a task force and
importing personnel to assist in protecting our region would be
helpful. This increased presence would aid local entities in
dealing with crimes that surpass the capacity of available
local personnel and provide additional expertise and cover
issues outside the bounds of the local jurisdictions.
Again, Senator, I appreciate the Subcommittees'
consideration of our testimony today and we are hopeful that
our emphasis on these issues will lead to further assistance
from the Federal Government and appropriate agencies. Though
our local law enforcement personnel is dedicated to do
everything it can to protect the residents of Richland County
and the Bakken region, we welcome further efforts, financial
support and additional resources in order to more effectively
remedy the issues affecting our personnel, our agencies, and
most importantly, the residents of Richland County and the
residents of the region of the Bakken area. Thank you very
much.
Senator Tester. Thank you, John, for your testimony. I very
much appreciate it, and you might be on the third panel but
your testimony was very insightful, thank you.
Mr. Dynneson. Thank you.
Senator Tester. Paul Groshart.
TESTIMONY OF PAUL GROSHART,\1\ DIRECTOR, RICHLAND COUNTY
HOUSING AUTHORITY
Mr. Groshart. Thank you, Senator Tester, for inviting me to
give testimony at this hearing on affordable housing in our
community. I apologize if this first part sounds like a teacher
giving a lesson, but several decades ago when I did go to
college I graduated to be a teacher, so it may sound like a
history lesson instead of testimony, but 30 years ago Sidney
residents would probably have known their neighbors by their
first name, knew where they worked, how many children were in
the family and what they liked to do for their hobbies. The
residents of Sidney and the surrounded area were like an
extended family, distant cousins if you will; and when families
moved into the area they were often invited to join service
groups, churches, chamber of commerce and school organizations.
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\1\ The prepared statement of Mr. Groshart appears in the Appendix
on page 114.
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Thirty years ago also marked the end of the first oil boom
in our county. That boom saw a span of 7 years. It brought
high-paying jobs, but by the time it ended there were several
reposed homes for sale, mobile home parks abandoned, trailer
houses abandoned and infrastructure costs left unpaid by
special improvement districts. 1984 was a long time ago for
many, but for some of us here in the community, the economic
collapse lasted a long time and made our community financially
distressed for several years after that. Fast forward to the
present and most everyone here can attest to the fact that the
oil boom is back bigger and better, but not so much for those
wanting to move here and make Sidney their home. Right now in
2014, there are jobs available in our area, high-paying jobs
that typically pay three to four times more than minimum wage.
Someone moving to the area may very well have that job, they
may very well have job security, but they do not have the most
important thing they need to succeed here in the Bakken, an
affordable place to live.
If you are fortunate to own your own home or are in the
process of buying a home, no doubt as a resident of Sidney, you
are much better off than those who in the community who are
renters. Those who rent now, see that the lack of rental
housing in our community is an acute and serious problem with
no short term solution in sight. For instance in 2013, a rental
market study was prepared for the Richland County Housing
Authority, and based on that study just one year ago, the rents
for existing rental units for 2012 were rising at a rate of 5
to 10 percent every month. The vacancy rate for privately owned
rental properties was at 0 percent; waiting lists for private
housing were nonexistent as turnover was rare. Furthermore, a
more followup market study that we did in 2014 revealed that
the same units that were filled prior to the year 2000 had rent
increases in 2012 and 2013 were now increasing their rents from
30 percent to 300 percent after a vacancy occurred or when a
lease expired. This vast increase in rent puts the local
working families in jeopardy of losing their rental housing
because rents can now exceed 50 percent or more of the take-
home pay. The families affected by this increase work at local
retailers such as restaurants, hotels and stores, and they may
even be the teachers, hospital workers, and law enforcement
officials that we rely on.
So who decides what is low income in our area? HUD annually
publishes a report on median incomes for nearly every community
in our State. Right now, the medial income for Sidney and our
county is $70,600 for a 4-person family. This means that there
are wage earners below that amount and wage earners above. It
is not the average, but should give everyone here in this room
an idea of wages are being paid in Richland County. If we
compare it to Rosebud County, our median income is $10,000
higher; compared to Park County, we are $16,000 higher; and
when we compare the median income to places like Helena and
Billings, we are about equal to their median incomes. Why is
housing not a problem in Billings and Helena? The supply of
housing in those areas probably exceeds the demand right now.
There are more places to rent; there are different levels of
quality; and there are far more providers of affordable housing
such as housing authorities. Our housing authority was created
in 1950 and has a contractual relationship with the Unites
States Department of Housing and Urban Development to provide
housing to low income community members.
Who can qualify for assisted housing programs? A majority
of our owned homes and managed properties are for people who
earn less than 30 percent of the median income. For instance, a
single person wishing to rent a 1-bedroom apartment from me has
to earn less than $12,250 per year to qualify; a 2-person
family would have to earn less than $15,730 a year; a 3-person
family less than $19,790; and a 4 person family has to earn
less than $23,850 per year to qualify for assisted housing.
What can Congress do to help us? First of all, I thank
Senator Tester for his support of the Small Housing Authority
Reform Proposal (SHARP). As long as I have been with HUD, they
seem to come up with acronyms for everything. Some of the
issues that affect housing authorities, although there are only
14 in the State of Montana, HUD has come along with a new
requirement for a fiscal needs assessment program that would
cost our housing authority anywhere from $30,000 to $50,000
just to tell them what's wrong their housing. They started
program 2 years ago called Rental Assistance Demonstration
Program which would allow housing authorities to opt out of
public housing and create properties that have vouchers or
Project Based Section 8, so we'd like to have that support
also. Of course, I know the programs have been brought up that
there are Section 8 Programs and I would like to just address
that. Three years ago prior to this oil boom coming, we
administered a Section 8 rental assistance program here in the
community and Fairview and Savage and we had 92 participants.
What that means is we were helping pay rent for 92 families or
single people in the three communities. We are now down to 42
families. It's not that those 50 116 people somehow went away;
it's that we cannot afford to pay the rents that the landlords
are now requesting. HUD has a limit, they say 'fair market
rent' they call it where a 2-bedroom place in Sidney is about
$800 a month.
Unfortunately, that doesn't ever happen anymore. The rents
are just too high for that program to work here. So the answer
as far as we are concerned in my area here is there has to be a
little bit more involvement from the Federal Government to
maybe declare us a disaster area and maybe we can hit some
other kind of funding because the restriction for the low
income people here as far as their income, they just don't
exist for us. So thank you again for your allowing me to speak
today.
Senator Tester. Paul, thank you for your testimony; thank
you for your work, and I know it's a difficult conundrum, but I
think working together we could find some solutions.
Commissioner Young, you're up.
TESTIMONY OF LOREN YOUNG, CHAIRMAN, RICHLAND COUNTY COMMISSION
Mr. Young. Thank you, Senator Tester, for inviting me to
the hearing today, and I also want to make a note that you have
a very wonderful staff to work with on the local level. You are
very blessed with that.
Senator Tester. Thank you.
Mr. Young. Well, I kind of went into about four or five
different areas here and have some statistics and since Paul
just got done talking, I am going to also mention that we are
doing a joint venture with the city for city and county
employees on a little housing project and being we have the
housing authority we kind of let Paul decide how that's going
to go out, so I wanted to announce that kind of joint venture
with us for law enforcement especially, for city and county.
And my next subject I want to talk about is the workforce
that all in common has been said here. It has been a revolving
door. It is quite a problem to compete with government salaries
with the oilfield, and as a county commissioner and a bean
counter it is a very scary trend that we have seeing these
budgets. Our county budget, our monthly payroll, is just a few
thousand, about $40,000 to $50,000 shy of a million dollars a
month, and conventional methods of creating revenue and taxes
through levies and stuff, it is a tremendous burden that's
being put on the county taxpayers that if the oil revenues are
lost, it can't be maintained, so I am sure you already know
that.
The other area I wanted to talk about was our health
department. I went back 10 years and got some statistics, and
this is the slow part of the department, it only went up 122
percent in 10 years, and most of the problems is the increased
traffic flow of out-of-State workers that arrive here, but they
are very overwhelmed, and that's the statistics for that one.
The next one I went into was law enforcement. I went back
10 years there. Law enforcement costs here have went up 288
percent to the best of my knowledge fingering through that
Black Mountain program. We also just got done building a new
$17 million plus dollar jail. As Mr. Anderson I believe, or one
of the gentlemen earlier stated, there have been times where
the reports come to our office in the excess of 40 people in
there, but it is averaging in the 30s. We built it for 24
adults and 12 juveniles, and we pretty much had to boot the
juveniles out and put the adults in there, and every morning
when the county attorneys come to work and the Justice of the
Peace that's sitting here they have to look at the list and see
who's bad, and who's badder, and who's baddest and the bad gets
to go home, and the badder and the baddest stays so it's really
a problem to deal with.
Also, with law enforcement here I asked Judge Mohr to give
me some statistics. In 2013, Judge Mohr saw 4,773 cases across
the bench. I did a little math on that. That's 13 cases a day 7
days a week or 91 to 92 cases a week, and he's well on his way
to that number and probably exceeding that number this year
again, so just a little statistic there that I would like to
pass on.
All right, Mr. Dynneson talked a lot about the sheriffs and
the law enforcement and we talked about the housing so I will
let that be on that one. Now, I am going to move to county
attorneys. County attorneys are overwhelmed in our county. The
statistic that I come up with on the county attorney is 954
percent based on the expenditures from 2004 to the new budget
that was just submitted to me in the last month, or last couple
months, so it's a very overwhelming thing that's going on there
and I just wanted to pass that number on because it's just
mind-boggling and I think these gentlemen who spoke on the
panel before me can relate to me with the increased domestic
violence, increased drugs and the murders and everything that's
going on here, so I guess that's all I am going to say about
the county attorneys' office.
My last one that I want to talk about is roads and bridges
and the county department. The road department has went up 743
percent in the last 10 years based on numbers that pulled. One
of our biggest calls and the most problem we have course is
rough roads. That's a daily thing. But dust suppression is a
nightmare. Everybody in the country is mad because of the dust
that's coming in so I believe a lot of this has came back in
the 70s, maybe 1973, the Constitution was opened up and
something put in there about the Montanans are entitled to a
clean and health environment. Well, they play that trump card
on us and we literally pay out. It's in the excess of $100,000
to $200,000 a year in buying Mag. Chloride. We have dedicated a
whole crew of people to handle the road patrol work and the
semis and we have even put up storage tanks and we have semi
loads of Mag. Chloride brought to us to try to appease the
public with all the phone calls that the commissioners and the
road bosses get and it's really a task. We have about 35 people
on the road department and it looks like they don't get
anything done. It's quite a bit of deterioration on the roads
with the truck traffic. And also, I will add here that our
public works director had a counter out on one of the local
gravel pits where all the gravel is heading into North Dakota
and we are getting nothing for it but a worn out road and
giving that man back there, Shane Mintz, a headache because of
all the road work it requires to maintain the roads out there;
and we have about 2,200 and some odd loads that went on that
road in one day out there into North Dakota. Well, that's fine;
that's business. I'm for business. But I'm going to give you a
little statistic here that you are not going to believe me but
that's fine; 2,280 semis in one on this road. One 80,000 pound
semi is equivalent to approximately 2,300 ordinary vehicles
like you and I drove to work today, so when you take the math
and you work that out this is one day, it would be equivalent
wear and tear on these roads of 5,244,000 ordinary vehicles on
that one stretch of road, and I will admit that this isn't
something that goes on 24 hours a day, it goes on and then it
slows down, it peaks up and it peaks down, but these are the
kinds of things that we have to deal with.
And I also have some pictures I am going to give Senator
Tester in regards to some accidents that have happened on some
of the roads in my area. There's been probably 20 rollovers
since the first of the year on some of these roads that were
built in the 1940s. I don't want to get the Department of
Transportation in trouble. I think they do a wonderful job at
trying to take care of the roads, but we probably have one of
the finest district directors in Glendive that money can buy,
but he ain't got enough money to take care of these roads out
here. Why can't you guys come and do a one-time infusion for
the impacted Bakken counties and get him some money so that he
can do something with these roads. I know that they try to go
on the fairness issue and based on population and stuff and I
have seen the numbers and they are fair numbers when you look
at them, but this is the area that's creating a $200 and some
million dollar surplus for the oil companies and I would like
to see the Federal Government help the State out with a one-
time infusion for this Bakken region for road rebuilding.
And on that issue, I think I am kind of running out. I know
I have overused my time. We have also done quite a lot of work
with the City of Savage, it's a non-incorporated town, and we
got the sewage lagoon fully funded thanks to all the different
agencies involved; and you asked earlier about red tape and I
think that's an understatement. CDBG has been great to work
with but there's a lot of red tape there, but it doesn't
matter, I'm not singling them out because the whole works is
just awful for red tape. I bet one of the first things that
happened when I got into office was a Order on Consent for the
lagoon being out of compliance and I have been working on that
almost 4\1/2\ pushing 5 years now and we still haven't even
moved an ounce of dirt, so that's bureaucracy and that's red
tape that's causing all those problems and it's nightmare and
now Sidney's facing it and it is a terrible thing that we have
to do all this red tape, so I guess I'll go ahead and hang up
the mic now and let you ask your questions and thank you.
Senator Tester. Thank you, Commissioner Young, for your
testimony. I very much appreciate it and my first question is
probably going to be self-explanatory by the testimony that you
have already given, but I will give you an opportunity to be
brief and say it again, and it is a question that I asked the
first panel and Attorney General Fox pointed out that I did not
ask the second panel and that is from your perspective what's
the biggest challenge you have out there because this Panel's
about infrastructure. Who's got the mic? Commissioner, what's
your biggest challenge as a county commissioner if you were to
pick one?
Mr. Young. Oh, I would say that trying to keep the roads
caught up to the traffic is probably our worst challenge.
Senator Tester. Yes.
Mr. Young. Helena has done a real good job with the
severance tax and we are ahead of the game because, just a
little history note here, Richland County is the county that
where the very first Bakken oil well just northwest of town
here was drilled. Everybody thinks everything is North Dakota,
but it happened right here just northwest of town; but roads
are a nightmare. That's our No. 1 complaint.
Senator Tester. OK.
Mr. Young. And we do the best we can with what we have. I
know we have tremendous revenue stream but it's still not
enough.
Senator Tester. Yes.
Mr. Young. And of course we try to make good decisions.
Senator Tester. Just curious, you said you have folks on
your road crew, how much has that changed in the last 5 years?
Mr. Young. Well, I believe 10 years ago they had about 15,
13 to 15.
Senator Tester. OK.
Mr. Young. But we can't even find anybody to hire that's
experienced.
Senator Tester. I gotcha.
Mr. Young. They don't want to work for what counties are
paying. They want that $35/$40/$50 an hour.
Senator Tester. I gotcha. Point well taken; thank you.
Paul? Not that you are working on housing or anything, but
what's your biggest challenge?
Mr. Groshart. Parking my car at the office now that school
has started. We have seen a large increase in the number of
rental units made available in the last year, probably last
year and half; unfortunately, as mentioned before, rents are on
the $2,000 range or higher, and as a business person, you know
as well as anyone, that if you are going to invest your money
in something like housing you want to get your money back out
faster rather than later, so as we find out when we go to the
bank to do a project, they are talking 10 years/20 years. If
you are going to 10 or 20 years you are going to have to get
your money out faster.
There's a HUD program called 221(d)(4) that is a mortgaged
guarantee program for multi-family developers, and basically
that helps lower the interest rate for the loan that the
developer may go get. That is about the only alternative that I
am aware of in the multi-family area that could help our
community if there was a developer available that wanted to do
this kind of housing and give him a 40-year mortgage instead of
10 or 20 years. They could keep the rents affordable for that
long of a period. The housing authority and our affiliate the
Richland Affordable Housing Corporation, we own one of those
properties that we were able to purchase with home funds in
2001. The original owner was from Kennewick, Washington. He had
ran out of his need to have that kind of a project. We were
able to buy it and keep it locally, but it is a 221(d)(4)
project where the mortgage was guaranteed. There was also a
Section 8 rental assistance into that project so you did
increase the amount of housing available for low income housing
families.
Senator Tester. OK. Thanks, Paul. John, if you were to pick
the one thing that's biggest infrastructure priority for you
what would it be?
Mr. Dynneson. Probably maintaining a workforce, an
experienced workforce, and then of course if this region
expands we are going to have the same issues that we currently
have is the overcrowding of the jail and workspace within the
facility that we have.
Senator Tester. Good, thanks. OK, Mike Tooley.
Mr. Tooley. Thanks for asking that question, Senator, and
it goes back to part of my response toward the end of my
closing, it would be dependable funding, not just funding, but
dependable. Let me explain why that is. The Department of
Transportation knows what to do and where the problems are, we
just don't have the resources to address it.
It's the same issues the counties deal with. My needs are
$1.5 billion per year to do what we should be doing. Right now,
the State of Montana between State and Federal funds, we are
making an investment of $440 million a year between State and
Federal funds; and so you can do the math, we fall behind every
year.
Senator Tester. Yes.
Mr. Tooley. So one of the most difficult things for us is
our inability to plan based on short-term funding fixes.
Congress recently transferred funds into the highway trust fund
to make it solvent through the end of May, which was great
because we were able to keep those construction projects going,
but what we like to do at the DOT is get 85 percent of our
contracts let by March.
Senator Tester.Yes.
Mr. Tooley. So that helps the contractors know what they
need to buy or who they need to staff and it keeps prices low.
Unfortunately, the two-thirds of the year is two-thirds of the
funds and so we don't have a full year of funding and so we
have to be pretty tentative on how let those contracts. It
dries up costs. It keeps the contractors from hiring the
personnel they need, buy the materials they need, and it all
winds up in cost increases, so we need dependable long-term
funding so we know that we can implement the plans the work
that we know needs to be done. A one-tine infusion to the
Commissioner's question, that might help, but the problem is
you have to plan these projects. Administrator Mintz has a big
backlog of projects that he could probably work on, but it
doesn't mean because the money's here today that it's going to
get done today, and so if that's something that Congress is
interested in doing I think that the State DOTs would want to
be part of that conversation to make sure that your intent is
met at the end.
Senator Tester. Right.
Mr. Tooley. So basically, coming back to dependable long-
term funding, something we can plan on and actually do some
work.
Senator Tester. Thanks, Mike. We don't have to take this up
today, but at some point in time I do want to have a
conversation with you about what the capacity is in this State
for road building. You say you have a $1.5 billion dollar need
out there and there's no doubt about that because we have been
all over the State and you do a great job but there is plenty
of need. We are doing about a third of that or a little less
than a third of that a year. If you had $1.5 billion, do we
have the construction capability to spend that kind of money?
You don't have to answer that now, but we do need to visit
about it. Go ahead if you want you can, but we can talk about
that later.
Mr. Preite, you deal with everything from soup to nuts,
what's the biggest infrastructure need from your office?
Mr. Preite. Well, Senator, I think the challenge that I
spend most of my time is trying to figure out a way to bring
people together so we can get the most effective use of the
resources that we have available to us out there. Now, in this
particular area, the Bakken, no question the resources are
scarce resources.
That's going to take a while to get that done. Having said
that though, as an example, Governor Bullock is proposing the
$45 million dollar bond issue. It's got to go to the
Legislature and then it will be available. Now, we should be
working, and we are working, with other people to try to figure
out the best way to at least at a minimum match that with other
resources and leverage it so that at a minimum we have double
that. Now, we spent a lot of time--I have to acknowledge this
we have like 17 or 18 community meetings over a 2-year period a
couple of years ago in the area, and what we found is every
time we had one of those meetings at least people in the
communities were incorporating, in-cooperating I should say, we
need to bring, and we do it, but we need to do a better job of
bringing everybody together to the table. Now, at USDA Rural
Developmental I have in my work plan scheduled 10 to 12
community meetings in this area, primarily, but throughout
Montana in the next 18 months, and at these meetings I am going
to go back because several years ago I had these meetings and
whenever we would have them and have all of the departments
there, and that's the best way to cut red tape, is to bring
those people there and let them, the CDBG people, my people,
the trust people, transportation people, the SBA people; we
have them all there and we invite them all there and we are
going to sit down, they are going to present their programs,
and then at the end of the meetings there's going to be tables
at the end for individual consultations so that the people at
the meeting can best understand the resources that are there
and other participants from the local, State and Federal
agencies understand what other people have. Sometimes we take
it for granted that everybody knows what's available out there;
no, they don't. There are more resources there that are
available that are not being tapped.
Now, I want to make a claim here that there's enough
resources to take care of all the problems, but we can do a
whole lot better job than we are doing in coordinating our
efforts. So, Senator, that's really what I am really concerned
is that knowing that we have scarce resources; knowing we have
these needs, we can not afford to let opportunities escape us.
We can not afford to not take the actions necessary to get the
best utilization and if I don't get another opportunity, I just
need to say your staff has been terrific, just great to work
with.
Senator Tester. You will probably get another opportunity.
Mike Tooley, this question has to do with staff retention and
recruitment and it will go to John Dynneson and Loren Young
after you get done, but your question is a little bit different
than the question I am going to ask them, and that is do you
have the flexibility to offer additional stipends for different
regions of the State, particularly this one because rental
costs are so high, as Paul pointed out, do you have the
flexibility within your budget to be able to say, 'Yes, I'm
going to pay this guy an extra $500 a month because the cost of
living is so high'?
Mr. Tooley. Senator Tester, that's exactly what we do. We,
in the Bakken area, offer a housing stipend of $500 a month,
and what that has done has helped at least with the retention
side for existing employees. We are still having positions that
are open until filled, which is something in my years of State
government I rarely see, but we have had the flexibility
through statewide policy to effect that type of stipend.
Senator Tester. Good.
Mr. Tooley. And it does work.
Senator Tester. Perfect. John, yours and Loren's is a
little bit different because it's two-forked: Number 1, do you
have the flexibility? And Number 2, do you have the budget to
be able to fulfill that flexibility if you have it? Do you
understand what I'm saying?
Mr. Dynneson. Yes.
Senator Tester. If you so choose to give an additional
stipend, are the dollars there to do it?
Mr. Dynneson. I believe that they probably are. You need to
understand, though, that I am here representing the Sheriff and
I am not sure what communications he's has in regards to that.
Senator Tester. What's said in the room stays in the room.
OK? [Laughter.]
Mr. Dynneson. OK. But I would applaud Mr. Groshart, the
county commissioners and the City council for the efforts that
they have made to start this housing project.
Senator Tester. Yes.
Mr. Dynneson. But what I would like for everyone to
consider is the support people. Those are primarily for law
enforcement. The support staff, the entry-level people that
come in; the cooks, the janitors, the secretaries; they are
kind of forgotten about, and a single lady with a child or a
man with a child. a married couple comes to town they both have
to work.
Senator Tester. Yes.
Mr. Dynneson. But if there's no daycare, you have that
issue.
Senator Tester. Amen.
Mr. Dynneson. So I applaud them for what they are doing,
but there needs to be some consideration for those level-entry
that do support us as much as they do.
Senator Tester. OK. First of all, I should have echoed that
after your testimony, I too, want to thank you for the joint
venture to build housing to help recruit and retain staff. I
think that's good thinking outside of the box and I can't
commend you enough.
As far as recruitment and retention, that's a plumb;
housing is a plumb, if you get this project done, to be able to
get them in with rental prices that I assume since this is a
joint venture the rental prices will probably be lower than
what they are----
Mr. Young. Yes, they would be. We are not going to be
renting apartments out for $2,200 a month.
Senator Tester. Right, exactly.
Mr. Young. Most of them $1,000 down and another $2,000
retainer.
Senator Tester. There you go. So that's good. The question
is do you have the flexibility to offer incentives over and
above wages? And you are going to look at a whole package if
you have a housing component.
Mr. Young. I believe that we do probably have the authority
to offer stipends and incentives like that.
Senator Tester. Yes.
Mr. Young. But so far we have just wanted to focus on
basically the law enforcement because that seems to be the
worst revolving door. We are blessed to really have a lot of
people that are established and living here and have their
homes.
Senator Tester. OK.
Mr. Young. And we have not really wanted to go down that
road because when you start stipends you start mutiny on the
bounty.
Senator Tester. You got it. I understand.
Mr. Young. But we have to come up with a price if we are
going to work on the housing authority that allows retention of
these employees in law enforcement without having to pay that
high rent, but also it's fair enough that we won't have too
many of the constant employees wanting to put their name on the
list and move into the new housing so it's a hard balance.
Senator Tester. OK. Pass the mic over to Paul. Paul, I kind
of touched on this issue with the Mayor and with Leslie. When
it comes to housing, is there enough land that can be developed
for housing? Is that an impediment for housing in Sidney?
Mr Groshart. Yes. The City basically was in a mode for a
number of years where they didn't annex a lot of land next to
the City in for any developments, and now that land is really
becoming limited, and when you do annex in land the City's
obligated to extend the services, meaning water and sewer,
which adds on to the cost of the project itself, so we are
basically landlocked in a way because we have a railroad on the
east side of town, the hills on the west, and you either go
north or south, and there is some prime farmland there that
could be developed, but again it's getting the services out to
that area. Perhaps, on your way to town you saw the new Town
Pump out on the four corners, and that is a huge development
there for the community, but it is outside the City limits.
Senator Tester. I did. OK, the Bakken I think needs about
$750 million bucks, three-quarters of a billion dollars in
infrastructure needs. Tony, given that magnitude, given the
fact that you have already addressed leveraging of funds and
how critically important that is, could you talk about if there
are other programs out there that you see that could be plussed
up to really meet the needs of a high-growth area like this
area?
Mr. Preite. Well, Senator, I am sure there are other
programs out there. That's what I was trying to get out earlier
in that, the day is gone when just one Federal agency or one
vendor or whatever can take care of the needs of a project.
Now, as far as the need for the infrastructure here in the
Bakken in North Dakota and Montana, sure it's a significant
amount, and today, no, we don't have the resources today to
address each one of them in an orderly manner, but we still
need to start the process of planning; you still need to start
the process of bringing all of the potential resources that are
with all agencies, local, State, Federal and the private
sector. We haven't talked very much about the private sector,
especially, in talking about the housing. We don't have, or it
doesn't appear that we have, and you please correct me because
you are the expert on it, but it doesn't appear that we have
the entrepreneurial dollars to go out and to build multi-family
complexes or even apartments and stuff, and I know you are
working very hard on that, but that's something we have to work
on; that all of those fit in the same bucket.
Senator Tester. Right.
Mr. Preite. In the final analysis. There are resources out
there that we have never utilized and we are going to have to
revisit that.
Senator Tester. Yes, that's fine, Tony, thanks. I'm want to
go back to a point that we brought up in the second panel, the
Attorney General was developing a plan with the Montana
Petroleum Association on hiring and helping law enforcement
that way and I said I applaud that effort and I do. The
question is from a infrastructure standpoint, and I talked
about this on the first panel, is there an avenue by which, or
have you approached this avenue, by which you could ask the oil
companies to pitch in a few extra bucks? Lore, do you want to
answer that, that's fine?
Mr. Young. Us commissioners, Mr. Mitchell is the other
commissioner that's here in the house, we have a really good
relationship with most of the oil companies----
Senator Tester. Sure.
Mr. Young [continuing]. Our road boss and the
commissioners, but when we bring up funding they all say that
we pay that 9-point something percent severance tax and we are
paying that to the State and it's coming back to us and they
feel that that's pretty much their commitment.
Senator Tester. OK.
Mr. Young. Now, some of them have stepped up and furnished
trucks and equipment if we furnish material.
Senator Tester. Yes.
Mr. Young. There's a couple of companies that are really
good to work with.
Senator Tester. Yes.
Mr. Young. But very few of them.
Senator Tester. Yes, I gotcha. I just wanted to know just
for the record. I appreciate that, Loren. We are going to
bounce around a little bit. I want to get back to Mike, and
Mike I will tell you from my perspective, I want to apologize
that we don't have a Highway Bill done, a 5-year Highway Bill
that is paid for and funded so you can plan, so your
contractors you contract with can go out and buy the equipment
they need to meet the contracts that you are going to let. That
aside, could you talk a little bit about if the money was
there, how do you make determinations for allocations? You
talked about there's a $50 million dollar additional just in
road maintenance, but how do you make that allocation? Because
you have roads in Western Montana that need work; you got roads
in Central Montana that need work; and you got roads in Eastern
Montana that need work. How do you make that allocation so that
everybody's not totally mad at you?
Mr. Tooley. That's a good question, Senator. The way we do
it is we look at a number of different factors, among them
being pavement condition; we look at congestion; and we look at
safety. Those are the three big things that we put into
consideration, and it's a pretty complicated process to get
there. It's managed through the districts through people like
Mr. Mintz that when those scores or when everything is added up
it rises to the top and those are the projects that wind up
being nominated and put into the program. As far as how the
actual funding distribution is, it usually comes back largely
to pavement condition, and certain percentage then is derived
from that. In this current case, the Glendive district is
number 2 only to Missoula in terms of pavement condition and
funding, and so funding has actually been shifted from some of
the other districts like Billings and Butte and Great Falls to
come out this way. While Missoula's remain pretty stagnant,
Glendive has continued to rise, and so it's a really delicate
balancing act for us.
Senator Tester. Well, I want to thank you and I want thank
you all for your testimony. I know we could literally go on. We
are past noon by a bit and I wanted to kind of wrap this up by
noon, but I just want to thank you all for your work; local,
State, Federal law enforcement; highways; county commish;
housing; Priete, everything that you do, I just want to say
thank you very much for what you do. I want to thank you for
taking the time this morning because I know you all had a whole
bunch other stuff you could have been doing so thank you for
your testimony; thank you for what you have done. We have
covered a fair amount of ground here today, and the issues are
out there. I think where we go from here is going to determine
whether we can address the issues here in the Bakken in a way
that meets the needs of the people here and meets the needs of
the businesses here, and I think that there has been a ton of
information put out on the challenges. They are many. We need
to remember there is a lot of positive out there too to help.
The Bakken has helped for energy sufficiency for this country,
so we are going to take this information back; we are going to
scrutinize it and try to compress and take it back to our
colleagues in the Senate and continue to work with the State
and local officials along the way to try to get some things
done here to solve some of the problems that we have heard
about today and there has been a bunch. For the record, this
hearing record will remain open for 15 days for any additional
comments or questions that you may want to put in the record;
and with that, once again, thank all the panelists and this
hearing is adjourned.
[Whereupon, proceedings adjourn at 12:19 p.m.]
A P P E N D I X
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