[Senate Hearing 114-531]
[From the U.S. Government Publishing Office]










                                                        S. Hrg. 114-531

  IMPACT OF FEDERAL REGULATIONS: A CASE STUDY OF RECENTLY ISSUED RULES

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

                                HEARING

                               before the

                              COMMITTEE ON
               HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS


                             FIRST SESSION

                               __________

                           NOVEMBER 13, 2015

                               __________

        Available via the World Wide Web: http://www.fdsys.gov/

                       Printed for the use of the
        Committee on Homeland Security and Governmental Affairs



[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]






                                   ______

                         U.S. GOVERNMENT PUBLISHING OFFICE 

22-474 PDF                     WASHINGTON : 2017 
-----------------------------------------------------------------------
  For sale by the Superintendent of Documents, U.S. Government Publishing 
  Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; 
         DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, 
                          Washington, DC 20402-0001


















        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                    RON JOHNSON, Wisconsin Chairman
JOHN McCAIN, Arizona                 THOMAS R. CARPER, Delaware
ROB PORTMAN, Ohio                    CLAIRE McCASKILL, Missouri
RAND PAUL, Kentucky                  JON TESTER, Montana
JAMES LANKFORD, Oklahoma             TAMMY BALDWIN, Wisconsin
MICHAEL B. ENZI, Wyoming             HEIDI HEITKAMP, North Dakota
KELLY AYOTTE, New Hampshire          CORY A. BOOKER, New Jersey
JONI ERNST, Iowa                     GARY C. PETERS, Michigan
BEN SASSE, Nebraska

                    Keith B. Ashdown, Staff Director
           David N. Drewer, Chief Counsel for Investigations
                         Kyle Brosnan, Counsel
       Scott Wittman, Communications Specialist and Investigator
              Gabrielle A. Batkin, Minority Staff Director
           John P. Kilvington, Minority Deputy Staff Director
     Troy H. Cribb, Minority Chief Counsel for Governmental Affairs
         Brian F. Papp, Jr., Minority Professional Staff Member
                     Laura W. Kilbride, Chief Clerk
                   Benjamin C. Grazda, Hearing Clerk
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                   
                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Johnson..............................................     1

                                WITNESS
                       Friday, November 13, 2015

Delanie M. Breuer, Assistant Deputy Attorney General, Wisconsin 
  Department of Justice..........................................     4
Lucas Vebber, Director of Environmental and Energy Policy, 
  Wisconsin Manufacturers and Commerce...........................     6
Jim Holte, President, Wisconsin Farm Bureau Federation...........     8
Henry Schienebeck, Executive Director, Great Lakes Timber 
  Professionals Association......................................    10
Bruce Ramme, Ph.D., Vice President, Environmental, WEC Energy 
  Group..........................................................    11
George Meyer, Executive Director, Wisconsin Wildlife Federation..    13

                     Alphabetical List of Witnesses

Breuer, Delanie M.:
    Testimony....................................................     4
    Prepared statement...........................................    33
Holte, Jim:
    Testimony....................................................     8
    Prepared statement with attachments..........................    49
Meyer, George:
    Testimony....................................................    13
    Prepared statement...........................................   106
Ramme, Bruce:
    Testimony....................................................    11
    Prepared statement...........................................    99
Schienebeck, Henry:
    Testimony....................................................    10
    Prepared statement...........................................    96
Vebber, Lucas:
    Testimony....................................................     6
    Prepared statement...........................................    40

                                APPENDIX

Statements submitted for the Record from:
    Environment Protection Agency................................   110
    Wisconsin Electric Cooperative Assocation....................   117
 
  THE IMPACT OF FEDERAL REGULATIONS: A CASE STUDY OF RECENTLY ISSUED 
                                 RULES

                              ----------                              


                       FRIDAY, NOVEMBER 13, 2015

                                     U.S. Senate,  
                           Committee on Homeland Security  
                                  and Governmental Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 1:02 p.m., in 230 
Laird Rood, Dreyfus University Center, 1015 Reserve Street, 
Stevens Point, Wisconsin, Hon. Ron Johnson, Chairman of the 
Committee, presiding.
    Present: Senators Johnson.
    Senator Johnson. This hearing of the Senate Committee on 
Homeland Security and Governmental Affairs will come to order. 
I want to welcome everybody here.
    Before we begin, I would like to ask everyone to rise as we 
welcome the UW-Stevens Point Army ROTC Color Guard to post the 
colors.
    Member of UW-Stevens Point Army ROTC Color Guard. Center 
face. Post colors. Present arms. Order arms. Center face. 
Forward march.
    Senator Johnson. Please be seated.

             OPENING STATEMENT OF CHAIRMAN JOHNSON

    Senator Johnson. I would like to thank Cadet Jordan Stuart, 
Cadet Kaitlyn Frieble, Cadet Ryan Dombeck, and Cadet Juan 
Patino for posting the colors.
    I also want to thank everybody for attending this hearing 
here today.
    The title of the hearing is The Impact of Federal 
Regulations: A Case Study of Recently Issued Rules.
    Let me talk a little bit about this committee, the Senate 
Committee on Homeland Security and Governmental Affairs. It is 
really two committees from the House combined into one in the 
Senate. You have the Homeland Security part of the committee, 
and you have the Governmental Affairs.
    And the Governmental Affairs part of the committee is a 
very broad jurisdiction of oversight over pretty much the 
entire Federal Government. That is really kind of on that side 
of the committee here today, a broad jurisdictional oversight.
    When I became Chairman, coming from a business background, 
I have done a lot of strategic planning. And one thing I 
definitely realized was very helpful in any business setting 
was developing a mission and vision statement. And so I went to 
our Former Chairman, now our Ranking Member, Senator Tom 
Carper, of Delaware, a person, I think, of real integrity. And 
I said, let us develop a mission statement for our committee, 
and so we did. And it is pretty simple: To enhance the economic 
and national security of America.
    And so from my standpoint, this hearing, this 
jurisdictional hearing, over regulations and the effect on our 
economy really falls under that, enhancing the economic 
security of this country.
    We are going to be talking about regulations, primarily 
focusing on the Environmental Protection Agency (EPA), which I 
would like to start with a quick question of the members of the 
panel and the audience. Does anybody here know anybody that 
does not want a clean environment?
    I did not think I would see any hands raised.
    It is true. We all want a clean environment, something we 
all value, particularly here in the State of Wisconsin. We have 
hundreds--I am personally a fisherman. I get my water out of a 
well. It is a goal of all of ours to keep our environment 
clean. We really value that. And that is a good thing.
    Now, the EPA obviously was established on December 2, 1970, 
to maintain a clean environment in America. And if you really 
think back to that--I am old enough. I was actually living in 
those times. On June 22, 1969, the Cuyahoga River in Cleveland 
actually set fire. We had some real problems with the 
environment back in the late 1960s, early 1970s. And so the EPA 
then made a bipartisan effort to address those abuses. We have 
come a long way.
    I would like to just point out the success of the EPA. It 
was really targeting five primarily pollutants at the time:
    Carbon monoxide. Again, the establishment of EPA in 1970, 
carbon monoxide has gone from 204 million tons to 68. That is a 
67 percent drop.
    Nitrogen oxides. From 27 million tons to 12 million tons. 
That is a 54 percent drop.
    Soot. From 12 million tons to 2.6 million tons. That is a 
79 percent drop.
    Sulfur dioxide. From 31 million tons to 5 million tons. 
That is an 84 percent reduction.
    And volatile organic compounds (VOCs), from 35 million tons 
to 17 million tons. That is a 51 percent drop.
    Now, all this occurred as our population went from 203 
million to about 320 million today. That is about a 56 percent 
increase. So we have done a pretty good job. We have come a 
long way. And again, it is a goal, maintaining a clean 
environment, cleaning up even further, that we all really agree 
to.
    I think the purpose of this hearing, though, is to talk 
about--and, really, the underlying concept is the law of 
emission returns. We have to evaluate any further action, 
further reductions. What is the benefit of those reductions in 
pollution versus what is the cost to society? We always have 
limits in terms of resources.
    An example from my own manufacturing background of the law 
of emission returns is I extruded clear plastic sheet. And 
sometimes we were called to do jobs that had colors. Now, we 
would go from clear to a color with a very small percent of 
color concentrate. But if we wanted to move toward greater and 
greater opacity, it would require greater and greater amounts 
of color concentrate to the point where you just were not 
getting much benefit even though those colors concentrates were 
expensive and you were having to put an awful lot in there. And 
I am sure you can all really kind of relate to similar types of 
examples in your own lives and your own background.
    So that is really what we are talking about, just a common 
sense concept of let us take a look at any further regulations 
as it relates to cleaning up our environment. What is the 
benefit, the dollar benefit, the total cost? It is just really 
a common sense approach.
    I certainly want to use information as much as possible. 
Now, one of the things I found in this debate on the 
environment and regulations is solid information is kind of 
hard to come by. A lot of these things are projecting into the 
future. We do not have perfect information. It is just hard. As 
an accountant, I like solid numbers, solid information that 
everybody can agree on. And that is difficult to get.
    But one of the ways I think you can get solid information 
is to put things in perspective. I did not see anything in the 
testimony----
    By the way, I appreciate all of your testimony. I read it 
all.
    I did not see anybody talk about the most recently proposed 
ozone rule. So I would like to talk a little bit about that. To 
kind of put things in perspective, in 1997, the allowed parts 
per billion of the ozone in the atmosphere was 80, 80 parts per 
billion. And so the EPA initiated regulations to drop that to 
75 parts per billion, which I think, by and large, we have 
accomplished that. I cannot really tell you how much that cost. 
I think it is very difficult to figure out exactly how much 
going from 80 to 75 billion parts per--80 to 75 parts per 
billion of the ozone--what that cost. But now the EPA has just 
issued some new regulations to take that from 75 to 70.
    Let me create an analogy of what we are talking about. 
Because that sounds pretty good, going from 80 to 75. That is 5 
parts per billion. Now it is 75 to 70. That's a 6.7 percent 
decrease. But here's what it really is. Assume an Olympic size 
pool. That's 660,000 gallons of water. 660,000 gallons. 75 
parts per billion is 38 teaspoons. Dropping that to 70 parts 
per billion would drop it to 35 and a half teaspoons. And so, 
again, the question would be, is it worth, in a 660,000-gallon 
pool that has 38 teaspoons of pollutant--how much are we 
willing to spend to drop that down to 35 and a half teaspoons? 
Now, it's all relative. It depends on how nasty that pollutant 
is. If it's just sand, it's probably not worth anything. If 
it's something incredibly nasty, it might be worth a fair 
amount. Again, I just want to kind of put things in 
perspective.
    I think I probably said enough in my opening statement. So 
what I would like to do----
    Do we have a list of the order of witnesses? OK.
    It is a tradition of this committee to swear in the 
witnesses. So if everybody will stand and raise your right 
hand----
    Do you solemnly swear that the testimony you will give 
before this committee will be the truth, the whole truth, and 
nothing but the truth, so help you, God?
    All Witnesses. I do.
    Senator Johnson. Please be seated.
    So our first witness will be Delanie Breuer. Ms. Breuer is 
the Assistant Deputy Attorney General (AG) for the Wisconsin 
Department of Justice. She has previously worked for the 
Wisconsin Public Service Commission (PSC), providing counsel on 
legal and policy management relating to utility regulation 
cases. Ms. Breuer.

 TESTIMONY OF DELANIE M. BREUER,\1\ ASSISTANT DEPUTY ATTORNEY 
            GENERAL, WISCONSIN DEPARTMENT OF JUSTICE

    Ms. Breuer. Good afternoon. Thanks to the University for 
hosting us, and thank you, Senator Johnson, for having this 
hearing and giving me the opportunity to provide testimony on 
behalf of Attorney General Brad Schimel and the State of 
Wisconsin.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Breuer appears in the Appendix on 
page 33.
---------------------------------------------------------------------------
    The health of Wisconsin's economy rests on the back of 
manufacturing, food processing, pulp and paper, and 
agriculture. Together, these industries make up the heart of 
our State, and all of them are in danger due to the EPA's 
attempt to control our natural resources.
    Environmental stewardship is important to all of us, but in 
order to leave our future generations better off, we have to 
find the balance between protecting our environment and 
protecting our economy.
    Over the last 7 years, the EPA has hammered businesses with 
regulations at a historic pace, but the Waters of the United 
States rule and the Clean Power Plan (CPP), in particular, are 
the broadest expansion of EPA authority to date. One gives EPA 
the authority to regulate almost every pond and puddle, and the 
other allows the EPA to manipulate the entire electric grid. 
The industries important to Wisconsin's economy might not 
survive this onslaught.
    The Waters of the United States rule (WOTUS), is an attempt 
by the EPA to control more bodies of water with Federal 
regulation. Practically speaking, the types of waters now 
subject to EPA regulation include ditches, ponds with no 
connectivity to navigable waters, streams that only flow after 
heavy rains, and the hundred-year floodplain, which is dry 99 
years out of a hundred.
    WOTUS particularly impacts agriculture. The rule adds more 
red tape and barriers to practical land use here in Wisconsin.
    Under General Schimel, Wisconsin has joined the fight 
against this Federal regulatory overreach. Currently the WOTUS 
rule is stayed pending litigation. A reversal of that stay will 
irreparably harm Wisconsin and many other States. Wisconsin 
will continue to support that litigation effort.
    The Clean Power Plan is the centerpiece of the Obama 
Administration's intended environmental legacy, but the 
repercussions of this will devastate Wisconsin's economy for 
little or no benefit. At its core, the Clean Power Plan is a 
cap-and-trade plan in disguise, the same type of program 
promised by President Obama during his campaign and rejected by 
Congress.
    In simple terms, the CPP is designed to end coal-fired 
generation. The devastating impact of this cannot be overstated 
as it applies to Wisconsin manufacturing. Wisconsin is in the 
crosshairs of this rule in a way unlike many other States. We 
have a manufacturing-based economy, and we have low renewable 
potential we currently rely on clean, reliable coal plants.
    Since 2000, we have invested $11.6 billion in reducing 
carbon in the utility sector alone. But still, we are expected 
to make one of the largest reductions of any State under this 
final rule.
    Currently, Wisconsin and 25 other States are seeking a stay 
of this illegal rule. If we do not get that stay, we have no 
choice but to begin making huge investments for compliance. 
Much like the recently litigated MATS rule, the EPA is happy to 
just force us to make those unnecessary investments, even if 
the rule is ultimately determined to be illegal.
    So the great irony of this rule is the impact. At best, it 
will be minimal. And at worst, it will do exactly the opposite 
of what the EPA claims to want. By its own calculation, the 
impact of this rule over the next several decades is so minimal 
it is practically insignificant. But if we consider the very 
real consequences of price spikes in electric and gas prices, 
it is more likely that global emissions will actually increase 
as a result of the rule. Energy price spikes will reduce 
manufacturers' margins to a point that they will be forced to 
relocate. And when they relocate, they are not relocating to 
the neighboring State. They are relocating to a different 
country, a country like China or India or Mexico where cheap, 
reliable coal energy is plentiful and where the very toxic 
emissions like mercury and SO2 are not controlled at all. Those 
countries will continue increasing their carbon emissions as 
well as their economies, and our economy will suffer. Those 
decisions to move overseas are not easily reversed. And if this 
rule is not stayed while it is being litigated, those decisions 
will be imminent.
    Now, many citizens do not understand the impact of these 
rules. Consumers will pay more for goods and energies, but that 
may be a few years down the line. Jobs will move out of the 
State and out of the country. And ultimately, global pollution 
could actually increase. The consumers will not blame the EPA. 
They will blame manufacturers, they will blame utilities, and 
they will blame farmers.
    Now, many Wisconsin companies are making the effort on 
their own to protect the environment. The air and the water in 
Wisconsin is cleaner than it has ever been, and that was all 
accomplished without the illegal intervention of the Federal 
government.
    There has been a lot of rhetoric thrown around about these 
EPA regulations. The impact of the rules on our economy--it is 
not being exaggerated--it will be detrimental and it will be 
irreversible. These two regulations will result in a regulatory 
power grab by the Federal Government like we have never seen.
    Senator Johnson. Thank you, Ms. Breuer.
    Our next witness is Lucas Vebber. He is the Director of 
Environmental & Energy Policy at Wisconsin Manufacturers & 
Commerce. Mr. Vebber.

   TESTIMONY OF LUCAS VEBBER,\1\ DIRECTOR OF ENVIRONMENTAL & 
       ENERGY POLICY, WISCONSIN MANUFACTURERS & COMMERCE

    Mr. Vebber. Thank you.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Vebber appears in the Appendix on 
page 40.
---------------------------------------------------------------------------
    Good afternoon, Chairman Johnson, everyone that is here. I 
would like to say thanks to the University for having us as 
well to this beautiful facility.
    As the Chairman said, I am Lucas Vebber. I am the Director 
of Environmental & Energy Policy at Wisconsin Manufacturers & 
Commerce. We are the State's Chamber of Commerce and 
manufacturers association. We have about 4,000 members of all 
sizes across every sector of the State's economy. About one in 
four private sector employees in the State works for a WMC 
member company. Our members are very concerned about both of 
these rules.
    The EPA rules we are here to discuss today are broad, 
unprecedented expansions of Federal power that will impact a 
wide variety of our members in very negative ways. Cost 
estimates put these rules, especially the Clean Power Plan, 
amongst the most expensive regulations ever promulgated. They 
were promulgated without a single vote of Congress. In fact, 
there is actually bipartisan efforts in Congress right now 
actively trying to stop both rules.
    These rules will fundamentally change the regulatory 
environment in Wisconsin and throughout the United States. It 
will certainly have vast consequences for our economy for a 
generation. It is going to cost our State tens of thousands of 
jobs and weaken our economy at a time when we can least afford 
it.
    My written testimony that I submitted goes into more detail 
on what the rules do. I will use the remainder of my time to 
just highlight a few of the key points on both the rules.
    The WOTUS rule, is a confusing and unnecessary regulation 
that puts State business and private property owners at risk. 
One of the stated goals by EPA in creating the WOTUS rule was 
to ensure, quote, ``that the waters protected under the Clean 
Water Act (CWA) are more precisely defined, more predictably 
determined, and easier for business and industry to 
understand,'' unquote. Ironically, the actual rule goes in the 
opposite direction. It creates uncertainty and confusion every 
step of the way. The uncertainty created by this and the 
potential for an increased regulatory burden is problematic, 
not only for manufacturers in our State, but for agricultural 
producers, private property owners, as well as local and State 
governments.
    Given the other industry-specific experts that are on the 
panel today, I will let them go into specifics about their 
industries.
    But I think it is important to note also that the WOTUS 
rule was introduced as a bill in 2009, Senate Bill 787. It was 
called the Clean Water Restoration Act. It was introduced 
because Congress felt they needed to pass a law to enact these 
changes. Congress at the time had a filibuster-proof majority 
in the Senate, a majority in the House, and they controlled the 
White House. The same party controlled all three. They could 
not get that bill passed. So they proceeded with rulemaking. 
And that is why the WOTUS rule is here before us today.
    Suffice it to say, for Wisconsin, this rule does not 
improve environmental regulation. It really subjects our State 
to more Federal control. That will mean more regulatory burdens 
for businesses as well as a greater risk of litigation for our 
State's employers and private property owners in the State.
    I would find it hard to believe, as the Chairman said, that 
there is anyone in our State that thinks regulators and EPA 
could better manage our State's pristine water resources than 
the Wisconsinites at DNR. And that is exactly the risk that's 
created by the WOTUS rule.
    The Clean Power Plan requires Wisconsin to reduce carbon 
emissions by 34 percent to 41 percent depending on if our State 
uses a mass-based or a rate-based approach, respectively. In 
reality, it is going to be a higher percentage as the baseline 
year used, 2012, was deliberately chosen due to low natural gas 
prices that distorted the actual use of coal. Governmental 
emissions that year were significantly lower than other years, 
the lowest since the mid 1990s, in fact.
    There are a lot of questions that need to be answered 
before we know all the specific impacts on our State, but one 
thing we know with absolutely certainty is that this rule will 
raise the cost of energy. Wisconsin produces just over 60 
percent of our State's total energy from coal sources. Coal 
power has proven to be an affordable, efficient, and reliable 
energy source for the businesses and families of our State. We 
have made significant investments in coal technology over the 
past several decades, all as Delanie said, while at the same 
time obtaining the cleanest air we have had in decades. And it 
is only getting cleaner.
    Less coal in our energy generation economy means more use 
of renewable sources. More renewables means a higher cost. 
Higher cost means less competitive industries, fewer jobs. It 
also means less money in the pockets of hardworking Wisconsin 
families because energy costs are not just something that 
businesses worry about. Families have to worry about them too.
    One study on the draft rule projected the job loss to our 
State at 21,000 jobs for 2030 with a $1.82 billion drop in 
disposable income. I should note that the final rule actually 
has a more stringent target for the State of Wisconsin, so we 
can only expect those numbers to be even worse.
    The changes necessitated by the Clean Power Plan will also 
impact the reliability of the electrical group. Natural gas 
plants will be operated at higher capacities. We will be 
relying more on renewables. That leaves little wiggle room to 
ramp up a generation should the sun stop shining or the wind 
stop blowing. Lack of energy reliability is yet another factor 
that will negatively impact our State's business climate and 
drive jobs and investment elsewhere to countries like Mexico 
and the South Pacific.
    I should also note that the market is working. We do not 
need costly mandates from the EPA. We need reasonable 
environmental regulations, not unreasonable environmental 
mandates. Our air is getting cleaner. Our State is taking coal 
plants offline as part of the market process. We have about 
1,400 megawatts of coal energy being taken offline over the 
next 5 years. Carbon emissions from energy production 
nationwide actually declined 10 percent from 2005 to 2013. Yet, 
the EPA still insists we handcuff American industry at times 
other countries are actually ramping up coal production, as 
Delanie said. By some reports, China is bringing on a new coal 
plant every seven to 10 days.
    Thank you, again, for giving me the time to speak today on 
behalf of our State's businesses. I look forward to answering 
any questions that you may have.
    Senator Johnson. Thank you, Mr. Vebber.
    Our next witness is Jim Holte. Mr. Holte is the president 
of the Wisconsin Farm Bureau Federation and also serves on the 
American Farm Bureau Federation Board of Directors for the 
Midwest region. He also raises beef cattle and grows corn and 
soybean on a farm in Dunn County. Mr. Holte.

  TESTIMONY OF JIM HOLTE,\1\ PRESIDENT, WISCONSIN FARM BUREAU 
                           FEDERATION

    Mr. Holte. I want to thank you, Chairman Johnson, and 
Members of the committee for the opportunity to testify on the 
U.S. Environmental Protection Agency and U.S. Army Corps of 
Engineers (USACE) final rule to define Waters of the United 
States under the Clean Water Act and, more importantly, the 
rules' impact on farmers.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Holte appears in the Appendix on 
page 49.
---------------------------------------------------------------------------
    My name is Jim Holte. I am a farmer in Elk Mound in Dunn 
County in the northwestern part of Wisconsin. I raise beef 
cattle, corn, and soybeans on the same 160 acres that my great 
grandfather purchased in 1884. Over the years, my farm has 
expanded to more than 800 acres of cropland, woodland, and 
buffer areas. Much of the farm is within the Chippewa River's 
floodplain, but that is not why I am here.
    This rule is bad for farms everywhere. I am here to tell 
you, at the very best, that this rule lacks clarity when it 
comes to permit requirements and farming exemptions. At worst, 
it is a blatant overreach by the EPA and the Corps.
    The EPA's actions made a mockery of the notice-and-comment 
procedures within the Federal Government's rulemaking process 
in three key areas.
    First, during the rulemaking process, the EPA dismissed 
concerns about the rule as being silly or ludicrous or myths. 
Statements from agency officials made it clear that they really 
were not listening to objections.
    Second, the EPA engaged in a PR campaign to solicit support 
for the rule. The campaign shared blogs, tweets, and YouTube 
videos about the rules' reported benefits, but failed, with any 
meaningful information, about the rules' actual content.
    Third, the EPA allowed its own internal timeline to dictate 
issuance of the proposed rule before the fundamental scientific 
study underlying the proposal was complete. It later dictated 
issuance of the final rule without providing any further public 
comment.
    This unchecked process culminated in a deeply flawed 
regulation whose true costs were never really considered and 
will not be known for years.
    I have concerns about how this rule will be implemented and 
how the Corps of Engineers struggles currently to keep up with 
its current caseload.
    I would like to share a short story: In 2013, a farmer by 
the name of Joe Bragger from Buffalo County wanted to install a 
temporary bridge over a very small creek on his farm. His 
application to the Wisconsin Department of Natural Resources 
(DNR) was submitted in late December 2013. It took the DNR less 
than a month to review, approve, and issue a permit application 
and forward it to the Corps of Engineers for their 
consideration.
    More than a year and a half later, the Corps closed out Mr. 
Bragger's application without a determination or any 
notification to Mr. Bragger. And it was not until Mr. Bragger 
requested the assistance from a Farm Bureau employee that it 
came to light that the Corps had erroneously closed the 
application file and failed to notify Mr. Bragger of anything.
    The system is not working as it should. If the Corps cannot 
sort out what to do with an application for a permit for one 
temporary bridge over a small creek in Buffalo County, 
Wisconsin, how on earth do the authors expect the Corps to 
handle the tens of thousands of additional permits that this 
rule will trigger for agriculture?
    Two years was too long to wait for an answer, nor can 
farmers wait for 2 years to find out if they can do normal 
activities like till their fields, apply fertilizers or pest 
management products. Crazy as it sounds, that is what this rule 
will require on farms like mine and thousands of others.
    As I said, much of my farm falls in a floodplain. Yet, even 
the lowest fields have long-term grassland and wood lot buffers 
that separate them from the Chippewa River. This rule would 
stop me from farming any of those fields that are shown on the 
second and third aerial maps that I provided in my printed 
testimony.
    But what is most egregious is the 80-acre field shown on 
the very first map in that conclusion, that field sits high and 
dry at an elevation 80 feet above where my home is at. Yet, it 
will be regulated by this rule because it has some sloping 
areas where water will run during a normal spring rain. It does 
not seem to matter that this water has zero opportunity to 
impact any waterway.
    In closing, the EPA and the Corps has repeatedly assured in 
speeches and blogs that the new rule will not increase 
permitting obligations for farmers or get in the way of 
farming. These statements are misleading as the examples for 
agriculture as interpreted by the EPA and the Corps will not 
protect farmers from burdensome permit requirements and 
devastating liability under this proposed rule. Bottom line, 
the Courts are unlikely to give consideration to old speeches 
and blogs.
    It is impossible to know how many farmers and landowners 
will be subject to agency enforcement or sued by private 
citizen lawsuits, but what is certain is that the vast number 
of common, responsible farming and forestry practices that 
occur today without the need for a Federal permit will be 
highly vulnerable to Clean Water Act enforcement under this 
rule.
    Thank you.
    Senator Johnson. Thank you, Mr. Holte.
    Our next witness is Henry Schienebeck. And Mr. Schienebeck 
is the executive director for the Great Lakes Timber 
Professionals Association (GLTPA). Mr. Schienebeck.

 TESTIMONY OF HENRY SCHIENEBECK,\1\ EXECUTIVE DIRECTOR, GREAT 
             LAKES TIMBER PROFESSIONALS ASSOCIATION

    Mr. Schienebeck. Thank you, Mr. Chairman. I appreciate the 
opportunity to be here today to testify on WOTUS.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Schienebeck appears in the 
Appendix on page 96.
---------------------------------------------------------------------------
    GLTPA believes that WOTUS is a far-reaching, unnecessary 
rule that provides no documented positive implication for water 
quality. However, because of the expanded territory, it will 
undoubtedly add great expense and costs to the operations of 
farming and forestry. Actually, it is hard to imagine any 
industry that is not impacted by surface water.
    The forest industry is the second most financially 
significant industry in Wisconsin after agriculture, and it 
generates almost 60,000 direct jobs and over $23 billion in 
annual activity. Northern Wisconsin's rural communities, in 
particular, are dependent on forestry for their economic, 
social, and ecological well-being. Actually, it is our culture, 
it is our way of life. And a lot of our members are third, 
fourth, and fifth generation.
    Due to the naturally wet landscapes of Wisconsin, GLTPA is 
concerned that WOTUS could irreparably harm Wisconsin's 
economy.
    Wisconsin already leads the way in water quality standards 
associated with forests. In 2013, the Wisconsin Department of 
Natural Resources conducted 75 audits on State and county 
timber sales. Best management practices for water quality were 
correctly applied in 97 percent and 95 percent of the audited 
sites, respectively. In 2014, the monitoring team visited 58 
Federal and large landholder sites and found similar numbers in 
a positive manner.
    As it stands, WOTUS seeks to improve water quality by 
greatly expanding the EPA's already broad authority, thereby 
reducing local water regulation and control. How could taking 
control away from people already doing such an exemplary job 
improve water quality?
    EPA may question why GLTPA is concerned about the rule 
since silviculture currently has an exemption under WOTUS. At 
this time, it is unclear whether the EPA would seek to remove 
the silvicultural exemption. Frankly, we do not trust that the 
exemption will remain in effect for very long. In 2014, the 
National Resource Defense Council filed a lawsuit seeking to 
remove the exemption, claiming forest roads cause sediment-
laden runoff into WOTUS. Further, EPA itself stated in 2012 
that it was looking at regulating forest road runoff.
    A silvicultural exemption without clear protection of 
forest roads would mean people could harvest their timber but 
have no way of removing it from the forest without the 
permission of the Federal Government. Since there is no 
evidence removing the exemption will improve water quality, 
does it make sense to add cost and confusion to an already 
effective and efficient process?
    Given the outstanding job the forest products industry has 
done in maintaining and even improving water quality, removing 
this exemption would serve no purpose other than to give the 
Federal Government expanded jurisdiction. This could cost the 
industry time and money without additional benefit to the 
environment. Also, BMP's if WOTUS were to be implemented in 
place of the State BMPs currently being used by forest 
managers, the vagueness of the rule would make it very 
difficult for anyone other than a Federal or affiliated 
employee to make a determination as to what qualifies as a 
wetland. Managers would fear being overruled and prosecuted for 
disturbance of a WOTUS. This would potentially increase cost if 
a land manager needs to interact with the Corps or the EPA on 
every decision.
    EPA has written that the rule does not protect any types of 
waters that have not historically been covered by the Clean 
Water Act or add any new requirements for agriculture. This is 
a very misleading statement. Perhaps the Clean Water Act 
historically covered wetlands, but it has not covered every 
drop of water on every piece of land. Under the new WOTUS, 
every piece of property could be included in wetland 
regulation, completely stifling or destroying any economic 
value gained by those resources.
     Perhaps the rule is not explicitly adding any new 
requirement for agriculture or silviculture, but how is 
expanding the regulated land base not requiring more time and 
money for compliance to expanded EPA and Corps authority? Even 
though an exemption exists, a farmer must now investigate every 
potential WOTUS on his property. Even then, because of the 
vagueness of the rule, he may face government prosecution for 
up to 5 years after unknowingly having discharged a regulated 
substance into WOTUS.
    Despite evidence that current State-level water BMPs are 
working very well, EPA continues to seek expansion of their 
authority. It is beyond comprehension that WOTUS will have any 
significant gain in water quality while expending billions of 
dollars of taxpayer money that could be put to better use such 
as reducing the national deficit or dependency on foreign 
energy.
    I am happy to take any questions. Thank you.
     Senator Johnson. Thank you, Mr. Schienebeck.
    Our next witness is Bruce Ramme. Mr. Ramme is the vice 
president of Environmental at WEC Energy Group. Mr. Ramme.

      TESTIMONY OF BRUCE RAMME, PH.D.,\1\ VICE PRESIDENT, 
                ENVIRONMENTAL, WEC ENERGY GROUP

    Mr. Ramme. Good afternoon, Chairman Johnson. And thank you 
for the opportunity to appear here this afternoon. In the 
capacity as vice president of Environmental for the WEC Energy 
Group, I am responsible for environmental compliance strategy 
and planning, mitigation and risk management, environmental 
permitting of new projects, compliance assurance, and 
identification of new and/or enhanced means of benefiting the 
environment through business practices at our utilities.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Ramme appears in the Appendix on 
page 99.
---------------------------------------------------------------------------
    The WEC Energy Group, headquartered in Milwaukee, has $29 
billion of assets and employs 9,000 people. We are the eighth 
largest natural gas distribution company in the country and one 
of the 15 largest investor-owned utility systems in the United 
States. We provide electric, gas, and steam services to nearly 
4.4 million customers in four States--Wisconsin, Illinois, 
Michigan, and Minnesota. Two of our six utilities are in 
Wisconsin, We Energies is in Milwaukee and Wisconsin Public 
Service is in Green Bay. We are the largest electric and gas 
provider in the State, providing half of the electricity and 
nearly 69 percent of the natural gas delivered to the residents 
of Wisconsin. Over half of our generation comes from our eight 
coal plants. All but one of those plants are located in 
Wisconsin. The seven Wisconsin coal plants are capable of 
producing over 5,000 megawatts of electricity and employ nearly 
800 people.
    Thank you, again, for the opportunity to appear before you 
today. And thank you for your leadership on this important 
issue, for your perseverance in pursuing improvements to the 
Federal permitting process and other regulatory reforms, and 
for working to keep us safe here at home.
    I am going to focus my remarks today on the Clean Power 
Plan because of its significant impacts, but I will be happy to 
also respond to questions about the Waters of the United 
States. As you know, the EPA issued its final greenhouse gas 
rule for existing units in August of this year. We filed 
comments in response to EPA's proposed rule and also 
participated in a joint Wisconsin utilities filing. We were 
pleased that EPA appeared to respond to some of our concerns, 
mainly the interim target, the safety valve, and trading, but 
we remain very concerned about some key issues in the EPA final 
rule, the uncertainty that it brings, the lack of recognition 
for early action, the 2012 baseline, and the gas dispatch 
building block.
    Since 2003, we have invested nearly $12 billion to 
proactively upgrade our systems and significantly improve the 
environmental performance of our generating units. We have been 
leaders in reducing emissions, and we believe EPA should 
recognize our initiatives, which include investing more than $1 
billion in renewable energy, including three large wind farms 
and a new biomass plant, investing more than 1 and a half 
billion in state-of-the-art emission control technologies to 
new and existing units, adding new generation, repowering an 
older, less efficient coal plant to a combined-cycle natural 
gas plant, and converting a coal-fueled cogeneration facility 
to natural gas. We invested in electric and gas distribution 
system upgrades, and invested in energy efficiency for our 
customers. As a result of these early actions, the new coal-
fueled units at our Oak Creek and Westonsites and the new 
natural-gas-fueledunits at our Port Washington and Wrightstown 
sites are among the most efficient in the country.
    Over the past 15 years, we have increased our generation 
capacity by more than 40 percent while reducing emissions of 
sulfur dioxide, nitrogen oxides, mercury, and particulate 
matter by more than 80 percent. Our CO2 emissions also 
decreased to a level that is below the year 2000.
    EPA retained 2012 as the baseline year to calculate State-
specific emission rate goals. 2012 is not a representative 
baseline year. The economy was still recovering, and natural 
gas prices were unusually low. These factors resulted in a 
significant reduction in the use of our coal generation.
    One of the main components in the EPA rule is a series of 
building blocks. The second building block calls for operating 
existing gas plants more often. This re-dispatch of existing 
gas plants is technically feasible but will fundamentally 
change the operation of our Nation's energy markets from the 
current practice of economic dispatch to environmental 
dispatch. Economic dispatch is based on the least cost to our 
customers. Moving away from economic dispatch to environmental 
dispatch will increase our customers' costs.
    In conclusion, EPA's greenhouse gas rule is complex and 
far-reaching and will significantly change the electric utility 
industry. There is a great deal of uncertainty throughout the 
rule, but one thing is certain. Costs will increase for our 
customers.
    Mr. Chairman, as you know well, we build things in 
Wisconsin. Wisconsin has a large manufacturing base. And many 
of those industries and companies rely on electricity to help 
manufacture their products. An increase in electricity costs 
could have an impact on their competitiveness, not just in the 
United States, but abroad as well.
    Unfortunately, I do not have current cost estimates to 
provide to the committee at this time. We, along with the other 
utilities in the State, are modeling our systems and have 
contracted with the Electric Power Research Institute (EPRI) to 
model the Clean Power Plan and its impact on Wisconsin's State 
utilities and our customers. Preliminary results should be 
available next year. EPRI is a recognized expert in the 
industry.
    Thank you, again, for the opportunity to testify before the 
committee and for your leadership on this important issue. And 
I will be happy to respond to questions as well.
    Senator Johnson. Thank you, Mr. Ramme.
    Our final witness is Mr. George Meyer. Mr. Meyer is the 
executive director of the Wisconsin Wildlife Federation. Mr. 
Meyer.

  TESTIMONY OF GEORGE MEYER,\1\ EXECUTIVE DIRECTOR, WISCONSIN 
                      WILDLIFE FEDERATION

    Mr. Meyer. Thank you very much, Senator Johnson.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Meyer appears in the Appendix on 
page 106.
---------------------------------------------------------------------------
    Before I give my testimony, the Wildlife Federation would 
like to thank you for your efforts supporting sportsmen on the 
issue of State management over wolves and your bill that was 
just introduced this week, your prior efforts in supporting the 
State Wildlife Grant Program, and your support for attention to 
Federal lands. We really appreciate that very much.
    On the issues before us today, the Wisconsin Wildlife 
Federation represents over 195 hunting, fishing, trapping 
groups located throughout the State of Wisconsin with a 
membership of over a hundred thousand members.
    My personal experience includes 45 years of environmental 
regulation in the State of Wisconsin. The sportsmen I 
represent, both in Wildlife Federation and groups like Ducks 
Unlimited, Pheasants Forever, Trout Unlimited, and scores of 
other sportsmen's groups across the country, are strongly 
supportive of the Waters of the United States rule.
    And it is for very obvious reasons. Those wetlands and 
small waterways that form the head waters of our streams and 
lakes in the State provide valuable habitat for fish and 
wildlife, which is the life blood of our recreational pursuits.
    But it is not just a cost versus recreational standpoint. 
We are big business in the country and in this State. In the 
United States, sportsmen have a total economic impact of $201.4 
billion, supporting one and a half million jobs. In the State 
of Wisconsin, the total economic impact of hunting, fishing, 
and trapping is $7 billion. We are big business.
    The WOTUS rule, Waters of the United States rule, has no 
impact in the State of Wisconsin. And the very reason for that 
is the first rule was struck down in 2001 by the U.S. Supreme 
Court. But the citizens of Wisconsin were so concerned about 
losing that protection of their wetlands and waterways, within 
90 days, they asked the State legislature to adopt the same 
regulations under State law. So within 90 days, a bipartisan 
legislature and a Republican Governor adopted the Federal 
regulations which had been struck down, which most Federal 
regulations were stronger than the regulations that are being 
proposed today. So there is no change in wetlands regulation in 
the State of Wisconsin because of the Waters of the United 
States rule.
    There will be Federal jurisdiction and State jurisdiction. 
But as there was in the past, there will be a general permit 
issued by the Federal government to DNR. So anyone that gets a 
DNR permit automatically gets a Federal permit.
    So why are we concerned then as sportsmen for the WOTUS 
rule? Well, we hunt in every State in this country. Right now I 
have members scattered across the hunter duck hunting or doing 
other water-based hunting or fishing. We want to be able to go 
to those other States and enjoy their waterways. Migratory 
water foul go through--from Canada down through our States down 
in Tennessee, Arkansas, and Louisiana. We want there to be good 
wildlife water foul habitat in those States so that there will 
be large enough populations that we will also have water foul 
in Wisconsin. You need good habitat throughout the flyway.
    Let us talk about the Clean Power Rule reductions. One of 
the major concerns raised--and it is a legitimate issue to look 
at--is the cost of applying the CO2 reduction rules. As was 
stated previously, we have had strong Federal and State 
regulation of other pollutants--sulfur dioxide, nitrous oxide, 
carbon dioxide. It was because of that Federal and State 
regulation that we have had those dramatic reductions in those 
health-problem-causing pollutants. But we have not had CO2 
regulations, which have a major impact on climate change and 
the future of our planet. These are the first regulations of 
those nature in the U.S. Government. And despite voluntary 
efforts--and there has been some good voluntary efforts by 
companies in the State--we are not going to get the kind of 
reductions we need without regulations. And are not going to be 
able to get countries like China or Russia or India to step up 
to the plate if, in fact, we do not show the leadership in this 
country to reduce carbon reductions.
    An estimate of the costs have been put together in the 
State by the Public Service Commission and the Wisconsin 
Department of Natural Resources that, in fact, the cost would 
be between 4 billion to $13 billion. I can go into the reasons 
that those are based on faulty assumptions during my written 
testimony. But one thing I have learned over 45 years of 
environmental regulation is that those costs are always 
substantially overestimated when the rule goes into effect. And 
my experience is that the final cost is usually between 10 to 
20 percent of the estimates.
    And for my tenure as secretary of the DNR, I will give you 
an example. There was a regulation put into place by the United 
States to reduce toxic wastewater discharges into the Great 
Lakes. It is called the Great Lakes Initiative. Industry 
estimated that in eight Great Lakes States, by regulating the 
discharges for municipalities and industries into the Great 
Lakes, it would cost industry and municipality $13 billion. And 
it allocated $2 billion of those costs to the Wisconsin 
industry and municipality. We scratched our heads in Wisconsin 
because we had adopted the same regulations 8 years earlier, 
and the true cost in Wisconsin was $200 million.
    I found that to be true in virtually every cost estimate 
for implementing major environmental regulations over my 
career.
    Thank you very much.
    Senator Johnson. Thank you, Mr. Meyer.
    I would like to point out before we go into questions that 
we did invite the EPA administrator, Gina McCarthy, to appear 
here and testify, and she declined. Again, I realize she is 
pretty busy. So we did ask if she would send a representative, 
and she did not, which is very unfortunate.
    We held a field hearing like this in Tomah after the 
tragedies within the Tomah Veterans Affairs (VA) health care 
facility. And the VA sent us two really high quality 
witnesses--it was extremely helpful. They heard the powerful 
testimony. And as a result, the VAs actually responded. The VA 
office inspector general retired after deep-sixing about 140 
reports. And the doctor who was prescribing opiates--they 
called him Dr. Candy Man or the Candy Man--has been terminated. 
So it was extremely helpful that the agencies actually came to 
a State to hear directly from people affected by their 
decisions.
    So it was very disappointing that the EPA would not send a 
representative. But this is the first step in the process. I 
mean, this will be something we will continue to explore. And 
if we have to go to Washington D.C., I might ask a couple of 
you to travel. I hope you would not mind. But we do have to get 
the actual agency hearing the stories from Wisconsin as well.
    Mr. Meyer, let me quick start with you. How many years did 
you work with the DNR?
    Mr. Meyer. 32.
    Senator Johnson. 32 years. So you have a fair amount of 
experience with the DNR.
    Mr. Meyer. I do. I am an older guy.
    Senator Johnson. Well, I was not implying that. I have 
white hair too.
    I really worked very cooperatively with the DNR in my 37 
years in the plastics business and always appreciated their 
expertise. I did not get the sense that the DNR lacked concern 
for our environment. I would say they really were concerned 
about the environment. Is that true?
    Mr. Meyer. Very true.
    Senator Johnson. So why isn't the DNR in Wisconsin, who is 
very concerned about the environment, as we all are--why isn't 
their regulation over Wisconsin's environment adequate?
    Mr. Meyer. I think it is. And I think my testimony on the 
Waters of the United States rule is that, in fact, the State is 
covered. It has been covered except for 90 days in the year 
2001. And, in fact, that is why I think the adoption of the 
WOTUS rule is not going to have an impact on forestry and 
agriculture and the industry in the State of Wisconsin. I do 
believe in the system that was created by the Federal 
Government when the Federal Government adopts a regulation and 
then delegates authority to the States and allows the States to 
do the regulation.
    And while one of the methods in the Clean Power Rule is to 
allow the State here--it sort of gives the goal of what has to 
be done in terms of reductions but then allows a State to work 
with its utilities to come up with the right combination, as 
Bruce indicated, of the various components to tailor-make the 
regulation to that State and then let the State enforce those 
regulations. So it is a combination.
    Senator Johnson. Yes. I would say the Federal Government 
really did take that attitude, kind of stepping back and 
letting States really run these things. Maybe, that is a pretty 
good argument.
    But do you understand businesses and organizations are 
concerned that sometimes the Federal Government, even though 
they say they are not going to get involved, get involved in an 
awful lot and can do some definite overreaching? I mean, do you 
understand the concern of the other people on the panel here?
    Mr. Meyer. I understand the fear. But I found that very few 
times in my tenure with the DNR, and the head of the 
enforcement division before I was secretary--that there were 
very few times, less than a handful--and that covers 20 years 
in my career where there was overfiling by the Federal 
Government, that they stepped in where the State did not want 
to. And some of the situations were dealing with State 
facilities because they knew the political pressure on the DNR 
did not regulate the Department of Administration.
    Senator Johnson. I mean, the concern here is that the 
Federal Government is ramping up its jurisdiction over the 
States, though. They have, in some respects, taken a step back.
    And this is where I really want to go to Ms. Breuer to talk 
about the history of the Federal Government and federalism as 
it relates to environmental control. And, obviously in Article 
1, Section 8, we have the commerce clause, which does allow the 
Federal Government to get involved in interstate commerce and 
regulating it.
    And then in 1824, in Gibbons versus Ogden, in a unanimous 
Supreme Court decision, they extended the regulation under the 
commerce clause over navigable waters. And to me, that makes 
sense.
    Let us say you have a stream in Wisconsin that enters into 
the St. Croix River, then dumps into the Mississippi. If you 
are polluting that stream, it is not just going to affect 
Wisconsin. It is going to start affecting Minnesota, Iowa, and, 
all the other States downstream.
    It is about navigable water. I do want to quick read the 
definition of navigable water by the Army Corps of Engineers. 
``Navigable waters of the United States are those waters that 
are subject to the ebb and flow of the tide,'' ocean tide, 
``and/or are presently used or have been used in the past or 
may be susceptible for use to transport interstate or foreign 
commerce.'' That is pretty clear, and that makes an awful lot 
of sense. And that's really been the standard for almost 200 
years. And it really has not been under dispute. The Federal 
Government does have--because it is really a national treasure, 
these navigable waters.
    Can you just kind of speak to how this is different when we 
start talking about Waters of the United States?
    Ms. Breuer. Sure. So one of the things that Waters of the 
United States rule does is diminish the certainty with regard 
to what they call neighboring waters or adjacent waters to 
navigable waters. So the common citizen thinks navigable water 
is one that I can paddle a boat down--right? or drive a boat 
down. And the EPA is now saying, well, basically anything that 
flows into a navigable water is also our jurisdiction, and that 
includes ponds that are within certain distances of navigable 
waters, even when there is absolutely no connectivity. So the 
DNR in the State cannot regulate someone who builds a pond on 
their land that has no connectivity to a navigable water, but 
now the EPA has potential jurisdiction over those on private 
land, on public land. It does not matter.
    And the neighboring waters, it is really just about where 
they are distance-wise in relation to navigable waters.
    This rule really expands what we think of as navigable 
waters to touch pretty much anything, including the streams 
that run through farms and land that do not even have water 
running on them every day, every year.
    Senator Johnson. But again, you were actually using a more 
expansive definition of navigable waters than the Army Corps. 
Again, the Army Corps is very clear that it has to be affected 
by the tides. Is there any water in Wisconsin that's affected 
by the tides other than the Great Lakes?
    Ms. Breuer. Maybe the Mississippi.
    Senator Johnson. OK. Or have been used in the past, 
presently used, or susceptible for use to transport interstate 
or foreign commerce. I mean, little streams that----
    Ms. Breuer. Right.
    Senator Johnson. Intermittent streams, things that dry up 
when it is not raining, they cannot be----
    That is actually a very clear definition; correct? Has 
there been an expansion in law beyond that definition?
    Ms. Breuer. No. The expansion has come through the rules, 
which we argue in our lawsuit is illegal and violates the 
commerce laws. And that is one of the main arguments that we 
put forth in the challenge to the Waters of the United States 
is that this is a complete constitutional violation.
    Senator Johnson. Mr. Holte, in your testimony, you talked 
about an attempt in 2009. It was the Clean Water Restoration 
Act. This is, again, in the first two years of Obama 
Administration where they had a 60-vote filibuster-proof 
majority in the Senate. A strong----
    Oh, I am sorry. Mr. Vebber.
    Mr. Vebber. Yes.
    Senator Johnson. A strong majority in the House. And there 
is a recognition that on the part of Congress and in the party 
that is in control, that in order to change the definition of 
navigable water, they actually had to pass a law. Can you 
describe a little bit more about that?
    Mr. Vebber. Sure. Absolutely.
    You saw the bill introduced, which would have changed the 
definition of--it would have changed navigable waters to Waters 
of the United States in Federal law. That bill was introduced 
because members of Congress felt that they needed a law to make 
that change. That law was not passed, despite having what could 
have been a path to passage there with majorities of both 
Houses and control of the White House.
    Senator Johnson. How far did it get?
    Mr. Vebber. I believe it got through the Committee process 
and then never passed on the floor.
    But unfortunately then, shortly 120 thereafter, we saw the 
administration forward the rule, a rule that was based largely 
on the bill that failed to pass.
    I think you see similar things playing out, unfortunately, 
in other EPA rules. You see the Clean Power Plan, for example, 
anticipates some type of a cap-and-trade system which has been 
introduced time and time again in Congress and time and time 
again rejected.
    It is a troubling State of affairs certainly.
    Senator Johnson. In the Clean Water Restoration Act, the 
information I have is, again, they were not trying to redefine 
navigable waters. They were just trying to increase the 
jurisdiction of the Federal Government over different types of 
waters and wetlands.
    Included in the definition would be including intermittent 
streams. Anybody know what an intermittent stream is? Is there 
a pretty exact definition of that somewhere in law?
    Mr. Meyer. It does not flow all the time.
    Senator Johnson. OK. So that would be a long ways from 
navigable water then; correct? You certainly would not be able 
to use an intermittent stream to engage in interstate or 
internet--or foreign trade and commerce; correct?
    Mr. Meyer. Right.. You would not.
    Senator Johnson. OK. So that would be a significant 
expansion of the navigable water standard; correct?
    Prairie potholes. Anybody know what a prairie pothole is? 
Kind of a----
    Mr. Meyer. Great place to duck hunt.
    Senator Johnson. Duck hunt. OK.
    Wet meadows?
    And then I--actually, a playa lake. That is just a bigger 
prairie pothole, I think, is what that is.
    Again, all these things are intermittent and a long way 
from navigable for the use of interstate or foreign trade and 
commerce; correct?
    So, again, the point I am trying to make is this really is 
an attempt for a dramatic increase in jurisdiction by the 
Federal Government over waters within States. Again, this is a 
Federal system here that I would agree with, Mr. Meyer, that 
the DNR really is concerned. By the way, so are Wisconsinites. 
We are really concerned about our environment. We are a bunch 
of hunters. I am a fisherman. We really are concerned about 
that.
    And I guess that is the question. Is the Federal Government 
really more concerned about Wisconsin's environment than we 
are? And is it worth the concern? I think it is a legitimate 
concern in terms of the Federal Government coming in here and 
creating an awful lot of uncertainty in terms of permitting, 
and exactly how to comply.
    Mr. Meyer. I am confident Wisconsin can handle it because 
of our legislation, but what I am not confident is that other 
States are going to be able to do the same thing without some 
Federal involvement.
    Senator Johnson. OK. One of the things we have to consider 
is the potential penalties. And who is best able to talk about 
the fact that, I have seen reports that potentially 92 percent 
of land mass of Wisconsin be subject to the Waters of the 
United States.
    Mr. Meyer. No.
    Senator Johnson. OK. So I would like to have a discussion 
there.
    Also, potentially, per violation, $37,000 per day could be 
the potential fines if you do not obtain the necessary permit.
    It looks like Mr. Holte would like to talk to that.
    Mr. Holte. Yes. You mentioned about the amount of the land 
in the State that could be subject to control. And that really 
comes to the point that we made about the vagueness of the 
rule. You could easily take this rule and interpret it to say 
that when I have an inch and a half of rain on my sloping 
ground and the water runs in little rivulets off it, that 
becomes the Waters of the United States.
    Senator Johnson. That would be like an intermittent stream.
    Mr. Holte. I guess it could be.
    But the impact is that, therefore, in that stream, I now 
need a permit in order to do tillage, I need a permit in order 
to spread fertilizer or manure, I need a permit to apply any 
crop protection products on any ground that has enough slope 
that water can run off it in a two-inch rain. And there comes 
where our great concern in agriculture is where this could--by 
the simple interpretation of the rule where it is vague, it 
could include, as you say, 80, 90 percent of the ground in 
Wisconsin.
    We have asked, as an organization, the EPA to take a look 
at five or six different farms across the country and give us 
interpretations on those areas. They have declined. We still 
struggle with this vagueness.
    And again, as they have gone through the process of 
creating this rule and taking comments and testimony and then, 
in the end, implemented a stricter rule, in the tip of a pen, 
they can eliminate any exemptions we currently have. And we 
have no recourse, no legislative recourse. This is done without 
any legislation passing. That kind of capitalizes the concerns 
we have in agriculture--the vagueness, the ability to eliminate 
any exemptions that are there very simply and quickly. We think 
it is a great overreach.
    And if we had some opportunity for the Corps and EPA to 
come and visit with us on farms and show us how it would work, 
we would have a lot more comfort, but we have not been able to 
do that.
    Senator Johnson. So why is that not a valid concern about 
kind of a capricious----
    Mr. Holte. Well, unfortunately----
    Senator Johnson. Of those rules?
    Mr. Meyer. I would agree with Jim. I think the EPA and the 
Corps should come and provide those examples.
    But this EPA regulation is actually weaker than the one 
that was in effect up until 2001.
    And I have a lot of experience. I cut my teeth on wetlands 
regulation and waterway regulation, and it did not include that 
percentage of Federal regulation of land in the State of 
Wisconsin.
    But I think you should have the right to be shown exactly 
how it is going to apply on your farm.
    Mr. Holte. That comes to the point, George, of our concern 
about the vagueness of the rule and the ease of changing the 
interpretation and, therefore, vastly change the impact of the 
rule.
    And as I explained--and there is where--a lot of 
Wisconsin's farmland slopes. I mean, anywhere from the 2 to 6 
and 6 to 12 percent of slopes are very common. And those could 
easily, by just interpretation, be interpreted to be a Waters 
of the United States. Because when I have a two-inch rain in 
late April and water runs off that ridge in different areas, 
now that whole hillside is a Waters of the United States. And I 
have to have a permit to do all those things I talked about.
    Senator Johnson. Mr. Holte, in your testimony, you also 
talked about the exemption of ongoing farming, but you say that 
your concern was because the exemption was originally enacted 
in 1977. But the only farmland that would be exempted would be 
something that has been in continuous farm use since 1977.
    Mr. Holte. Well, that----
    Senator Johnson. Can you speak to that? That is really----
    Mr. Holte. That gets into some of the details of whether or 
not farmland is continuously operated, if it changes owners or 
change--goes from a parent to a child or, that is one more of 
the vague issues that we have great difficulty with, maybe not 
as extreme in that particular example, but in the vagueness of 
where exemptions apply and do not and what really does 
constitute a Water of the United States and what is an 
intermittent stream? Is it one that occurred once in the last 8 
years on this hillside of mine, or is it one that has to occur 
monthly every year?
    Again, our great discomfort comes with the vagueness and 
the ease of changing of the interpretation of the rule by just 
a changing of the rule with no congressional oversight.
    Senator Johnson. Mr. Holte, I believe it is also in your 
testimony you expressed some concern about the way the EPA 
actually marketed or solicited comments outside the way they 
normally do. I mean, normally the way the comment is supposed 
to work with the Federal agency is they are supposed to issue 
the rule as kind of a neutral arbiter. And then based on that 
rule proposal, they are supposed to solicit pretty much in an 
unbiased fashion comments from the public that would be 
affected by that; correct? Can you say how this was different?
    Mr. Holte. Well, that is very accurate.
    From the very beginning of this rule's forming and 
composition and coming forward, our organization across the 
whole country has been very concerned. And so we took a great 
deal of activity and participation in the process of commenting 
on it. And it was as if our--because we were contrary to where 
the rule was going, our comments were made to seem unimportant. 
And there's occasions where they even discredited us as being--
what was it?--silly or ludicrous or--or carrying on myths. So 
was it their place to judge our character in the submission of 
the rules, or is it their place to accept all submissions of 
comments regardless of where they come from? And that is the 
point I had made, Chairman.
    Senator Johnson. I had written an oversight letter to Mr. 
Howard Shelanski, the administrator of the Office of 
Information and Regulatory Affairs, concerned about that. 
Because we do actually have a law, the Antilobbying Act, makes 
it a Federal crime to use appropriated money to influence, 
quote, ``in any manner a Member of Congress, a jurisdiction, or 
an official of any government to favor, adopt, or oppose any 
legislation, law, ratification, policy, or appropriation.'' The 
EPA was really utilizing social media to solicit comments that 
were favorable to their ruling. Do you have that similar type 
of concern?
    Mr. Holte. I do. In this whole process, I would have to 
step back and say that the EPA, I think, in their minds, has an 
honorable goal. And they saw this as something they needed to 
do to protect resources. But what they failed to do was have 
understanding of what actually happens on the ground. And by 
this they discredited the process of submitting opinions and 
comments, and they are not taking under serious concern those 
of us that are on the ground every day. And that is one of the 
greatest concerns I had.
    Senator Johnson. OK. Which is, again, why we invited an EPA 
representative to listen to testimony, provide testimony 
themselves. By the way, they have a statement for the record, 
which we will enter.
    But it would have been nice to have them here, and we could 
have bounced some of these ideas off them. Mr. Schienebeck.
    Mr. Schienebeck. Yes?
    Senator Johnson. I have done an awful lot--and by the way, 
you have been helpful--I appreciate it--touring the timber land 
and learning an awful lot in the last 5 years.
    Can you compare--this is a little bit off topic, but I 
think it is relevant. Can you compare the permitting process 
for harvesting timber from a county standpoint to a State 
standpoint to trying to harvest timber in a Federal forest? Can 
you just kind of talk a little bit about that? Because I think 
it is somewhat relevant to the issue we are talking about here, 
how the ease with which we can do this so we can maintain 
healthy forests. County, State, to Federal Government.
    Mr. Schienebeck. Well, actually, a lot of the permitting 
for a stream crossing would go through the Department of 
Natural Resources. And we would get into the Corps----
    For us, a navigable stream is something that we can put a 
canoe in anytime of the year and float a canoe. It does not 
matter how far as long as it can hold a canoe at that point in 
time. So for----
    Senator Johnson. But that is a far stricter or more 
stringent standard than what the Army Corps lists as a 
navigable water; correct? So the DNR has a much tighter 
standard for navigable water than what the Army Corps does; 
correct?
    Mr. Meyer. Yes.
    Senator Johnson. Mr. Meyer, you agree with that?
    Mr. Schienebeck. Yes. That is our BMPs for water quality. 
That is what we follow for forestry operations. I mean, that is 
in our manual.
    Senator Johnson. Let me quick--because I think it might 
have been when I was on tour with you. I have heard reports--
again, it is just anecdotal--that the way the DNR determines 
whether they can float a canoe is they will definitely pick a 
really wet day after a really heavy rainstorm with a really 
light canoe or--and--kayak.
    And then they will--if they can float that thing on initial 
water, that is navigable. Is that----
    Mr. Meyer. We used to like those 80-pound kayakers.
    We really liked them.
    Senator Johnson. OK. So obviously--I mean, basically you 
have heard that. So the point being is, the DNR is far more 
stringent in terms of its definition of navigable water here in 
Wisconsin to protect our environment than the Army Corps is 
under current navigable water standards.
    Mr. Meyer. Yes
    Mr. Schienebeck. Yes. I would agree with that.
    And the difference is--I mean, if you are on county timber 
lands, they do a super fantastic job of managing their lands. 
They provide all the benefits-- ecological, environmental, all, 
social, everything that we need.
    The State does a very good job, I would say, in Wisconsin.
    And I also represent a lot of people in Michigan, and 
Michigan does a great job as well.
    And the Federal forests are getting a lot better.
    They are kind of going back to where we were 10 or 15 years 
ago. And I think a lot of that is due, in part, because you 
have come up, Senator Baldwin has been to our forests many 
times, and we have gone out and looked at them.
    And good neighbor authority is going to be a huge help in 
implementing more of that management.
    The fact of the matter is that we are all really concerned 
about the environment and--all of the forests because they are 
all multiple-use forests.
    Senator Johnson. But again, from that standpoint, good 
neighbor authority is really moving more toward the type of 
approval process, sort of the one-stop approval process, in our 
State process versus the multiple approval process for 
harvesting on Federal; correct? That is I really want you just 
to kind of get into who the agency is State versus Federal--and 
what that approval process is in terms of the timber 
harvesting.
    Mr. Schienebeck. Well, I mean, first of all, if you are 
going to do a timber harvest, you have to have an approved 
plan. And that has to be approved by a certified plan writer. 
And then you set up that management plan. And if you are going 
right along, we will just expedite this whole process. Then you 
would set that timber sale up.
    And it really depends upon the amount of paperwork. Let us 
say if I am doing a private timber sale, my contract might be 
two, three, four pages. If I am doing a county timber sale, the 
most of them that I have done are no more than 8 to 10 pages. 
If I am doing a Federal timber sale, it is going to be a 
hundred pages and----
    Senator Johnson. And it is a multiple-step process; right? 
So it is----
    Mr. Schienebeck. Yes.
    Senator Johnson. County land and State, you get that 
approval process once, and you can go in and correct? You go 
through----
    Mr. Schienebeck. Well, they all have their own approval 
process. So they are separated out that way. But once we have 
that approval, we move forward.
    Senator Johnson. But in Federal, you get the approval. And 
then there is another chance, really, for litigation.
    Mr. Schienebeck. Well, not----
    Senator Johnson. That is how it was described to me.
    Mr. Schienebeck. Yes. I mean, once I buy the sale, it is 
good to go.
    But to get to that point, first, when they do their 10 to 
15-year plan, there is a lot of people that put comments in, so 
on and so forth. But then once the plan is approved, which is 
probably what you are referring to, is when we had our 15-year 
plan in place. But then when they go to put up those sales, 
then the litigants come forward and they want to sue after the 
plan has already been approved. So then----
    Senator Johnson. That is what I am talking about. In the 
State, you do not have that capability.
    Mr. Schienebeck. Right. We do not have that--necessarily 
all that red tape that we go through. But it is quite common on 
the Federal forest.
    And so we have the plan. They set up--let us just say. That 
is multiple timber sales up there. And litigants come forward 
and wanted to stop the sale. And actually, there has been a 
couple instances where the sales were actually sold, but they 
were litigated. So the foresters actually had to buy the sale 
back from the person that won the bid because they could not 
get in there for a 10-year period.
    And it starts out, in a particular instance over by Laona, 
it was a 12-year process to get through that whole litigation 
to bring everybody together. There was, like, endangered 
species there such as ginseng, those type of things. So to get 
through that whole process was a 12-year process. And that is 
where we see where WOTUS could have a huge impact.
    Senator Johnson. There is your concern. If the Federal 
Government gets involved and claims jurisdiction over these 
things, you are concerned, just like in terms of harvesting 
timber, to produce jobs, but also to keep the forests healthy. 
I mean, that is probably the greatest impression I have had as 
I have taken the tours. Those forests that are managed where we 
actually allow timber harvesting are far healthier. There is 
far more animals in those forests as opposed to the old growth 
ones. I mean, they look kind of cool. They are kind of spooky, 
but they are dying.
    Mr. Schienebeck. Yes. Absolutely.
    And here is one of our major concerns. And I think 
everybody in here that is a landowner would have the same 
concern. And we have a lot of private landowners in Wisconsin. 
If I want to come onto your property, build a road to get in 
there, do my harvesting, and get out, I am going to spend about 
1,200 bucks to get across the 40. And I am just going to make 
this simple. Let us say we are going to do a mile of road. If I 
am just going to do a simple mile of road, I am going to look 
at about $4,400. I will get in there, do my harvest, get out. 
And that road will be there for the next----
    Senator Johnson. And it is the property owner that makes 
the decision whether he is going to let you do----
    Mr. Schienebeck. Yes.
    Senator Johnson. And you can work out a deal in terms of 
any kind of remediation or covering up the road or sodding over 
it with that landowner.
    Mr. Schienebeck. Yes. So let us say that if we are going to 
look at WOTUS, we are going to look at every water pocket that 
is on that road. Now I am going to have to spend probably about 
$8,000 because I am going to want to make sure that if you want 
that road to remain on your property for the next entries into 
your property, if there is any water sitting anywhere that 
generates any type of plant or a cattail or anything like that, 
now I am going to be required to get a permit to use that sale 
the next time. And if I want to make sure there is going to be 
no water sitting anywhere on that road, I am going to be 
spending about $38,000 to put a road in because it is going to 
be graveled, ditched, crowned. It is going to have every 
feature of basically a spec road. That means you, as the 
landowner, are going to get less money. That means I am going 
to take less money as a producer. But it also means that there 
is going to be zero improvement in water quality because none 
of those ponds or none of those borrow pits that I might have 
created are going to have anything to do with water quality.
    Senator Johnson. Because it is not navigable water.
    Mr. Schienebeck. Exactly.
    Senator Johnson. And again, now with the State rules, you 
do not have to go through any of that process. You still have 
the DNR jurisdiction in some way, shape, or form.
    Mr. Schienebeck. Yes. And we follow best management 
practices.
    Senator Johnson.: You have that already done. It works in 
the State of Wisconsin. And you really do not need the Federal 
Government butting in and creating high levels of uncertainty.
    Mr. Meyer, do you understand the concern?
    Mr. Meyer. I do. But there will be--what is happening when 
there has been dual restriction, since 1977, is that the 
Federal Government has deferred to the State government and 
stayed out of it so . . .
    Senator Johnson. But they are not----
    Mr. Meyer. There was actually a joint application. We 
filled out one application. The State issued the permit. It 
covered the Federal permit. And Henry would not have to build 
that road any differently than he does right now for the State 
government.
    Senator Johnson. Well, what has changed since 1977 until 
today, the standard was navigable water where the Wisconsin DNR 
has a more stringent definition of navigable water than the 
Army Corps. And now that would be changing under this.
    Mr. Meyer. The standard you read was the former standard 
from jurisdiction of the Federal Government, but that changed, 
and the 1972 Clean Water Act was far broader.
    Now, the regulations that got struck down in 2001 took the 
tip off of that broader jurisdiction. But there was far greater 
jurisdiction between the Federal navigable water standard and 
that covered by the 1972 Clean Water Act.
    Most of the water in this State is covered by the Clean 
Water Act, not just those subject to time.
    Senator Johnson. OK. Where would I find the current 
definition of navigable water?
    Mr. Meyer. Well, for navigable water, that would be in the 
Section 10 of the--and I forget what law or regulation, but it 
goes back to the turn of last century. But the Clean Water Act 
jurisdiction is in the 1972 amendments to the Clean Water Act.
    Senator Johnson. OK. Well, I will check that out.
    Mr. Meyer. Please.
    Senator Johnson. I mean, this is my understanding that this 
was the current.
    Mr. Meyer. It is a complicated variable believe me.
    Senator Johnson. I think, everybody's concern. I am a 
business guy. I like keeping things as simple as possible.
    Mr. Meyer, let us talk a little bit about costs of some of 
these regulations.
    Mr. Meyer. Sure.
    Senator Johnson. I mean Mr. Ramme.
    Mr. Meyer. OK.
    Senator Johnson. You stated that costs will increase. We 
just do not have the figure at the tip of your fingers.
    President Obama, when he was a candidate, was talking about 
his proposed cap-and-trade policy. And he said, if enacted, 
because of his cap-and-trade proposal, electricity rates would 
necessarily skyrocket. That little chunk, that is an exact 
quote. Do you agree with what Candidate Obama said back then, 
that, his policy as it relates to the power plant, power 
generation, will cause electricity rates to skyrocket?
    Mr. Ramme. I would say already, over the last half of a 
dozen years or so, we have seen so many regulations occurring.
    If we go to this Clean Power Plan that we are talking about 
and the Waters of the United States, I see increased costs 
coming from both.
    And in the case of the Waters of the United States, it just 
adds additional complexity. Now we are running electric or gas 
lines somewhere. We have to go spend the time to figure out, is 
it a jurisdictional ditch or not? So a lot of this is about 
ditches, really, in there. And Wisconsin already has very 
protective rules.
    On the Clean Power Plan side, if we look at that, we do not 
have our estimates yet. Whatever number I would give you today 
I can just about guarantee would be wrong. And so I do not want 
to do that. And----
    Senator Johnson. Of course, isn't that part of the problem 
is we just, in the end, never know? I mean, the costs end up 
being hidden? Nobody, in the end, really accounts for them in 
terms of when these things were implemented. And 5, 10 years 
later, now they have been--people have spent the money. And you 
have your costs. And you go to the Commission and submit your 
rates, and you get--because you can justify the costs, rates go 
up. And who ends up paying for that?
    Mr. Ramme. All of our customers. And I said in my testimony 
there that the cost will increase. I am confident of that. It 
is just by how much in this case.
    And I think these are very complex rules. And, we have been 
analyzing them. We have commented on the proposals and when 
they came out. And we keep learning things, as we go through 
these rules.
    The other thing that goes on, I think George mentioned, 
that a lot of times the estimates tend to come in lower than 
originally projected. And that may be true in some cases 
because there is a lot of uncertainty that comes with the rule.
    And, you are looking at how are we going to do it? Once 
this becomes a regulation or rule, we have to rise to the 
occasion and find a way to meet those requirements. And, 
sometimes we are very good at that. And in this case, I think 
this is more challenging than usual.
    Senator Johnson. Well, in my background memo, one of the 
things the staff listed for me a number of different standards. 
And these actually come from the Department of Energy. Things 
like refrigerator efficiency standards and water heaters. For 
example, in 2011, the refrigerator efficiency standard 
increased the price of a refrigerator by $83. In 2010, the 
water efficiency standard increased the cost of a water heater 
by $464. A fluorescent lamp, $12. Another one for a fluorescent 
lamp is $3. Electric motor efficiency standard, $313. A walk-in 
cooler--now, probably not a whole lot of people buy walk-in 
coolers--but, $1,086. You just total the whole thing up, just 
from 2009 to 2014, some of these efficiency standards, if you 
were unlucky enough or lucky enough to be able to afford to buy 
all these products, that is about $2,400 of increased cost on 
the product that is pretty hidden.
    And isn't that part of the problem that you in the end, we 
just all end up paying----
    I would ask the question--because I have seen different 
studies. And one of the reasons I do not throw out the numbers 
is because, I see a wide variation of it. But does anybody have 
a study or a quote or figure in terms of estimates of how much 
it costs per Wisconsin family some of these regulations on 
energy? Anybody want to step up to the plate on that one?
    Ms. Breuer. I can speak to it a little bit. It is more of a 
percentage than an actual number. I was very intimately 
involved in the modeling that Mr. Meyer does not like that the 
PSC did. So I was very close to this in my last position at the 
Public Service Commission. And it is more of a percentage. And 
it is double digits, 10 to 25 percent.
    The reason there is such a range in the cost estimates, the 
4 to 13 billion, is because of the different compliance options 
and the different ways that different plants are treated.
    One way to come into compliance with this plan is to build 
all new natural-gas-fired plants. Take a bulldozer to the rest 
of your old fleet even though you are still paying for that. 
Because those new plants are under a different standard. They 
are not under the 111(D). They are under the 111(B). And so 
they do not really count under 111(D). That is not a practical 
solution, but it is the lowest cost option.
    And the better way to do it is to keep some of your coal 
online for reserve, but then you are going to have to buy 
credits from somewhere else. And that is a more expensive 
option.
    So it is more about a percentage increase than an actual 
number. Because right now the large energy users that Lucas 
represents carries so much of the burden of the infrastructure 
costs that if they start going away, then all of the 
residential bills will go up even more because they will have 
to pay for what industry was previously paying for.
    Senator Johnson. Mr. Ramme, you talked about investing 13, 
$14 billion already. Do you have a calculation in terms of what 
that--obviously you invested that money. That goes into your 
rates. Do you know how much those investments have increased 
the families' of energy costs?
    Mr. Ramme. It was, I think, $12 billion that I cited there. 
And, I would have to go back and look at the revenues over that 
period of time. Sorry. I don't know that.
    Senator Johnson. OK.
    Mr. Ramme. I can get back to you with that.
    Senator Johnson. But again, those are costs. And those do 
get allocated into rates; correct?
    Mr. Ramme. They are very real as far as that goes so . . .
    Senator Johnson. OK. Ms. Breuer, I did really want to 
talk--because you did not cite in your testimony the actual 
decision, but the Chevron decision. You were talking about how 
the agencies, particularly over time, have really become, I 
would say, a little more vague in their regulations because of 
that Chevron decision by the Supreme Court that basically says 
that the agencies themselves will be responsible and, really, 
be looked upon for guidance in terms of, what the law actually 
says.
    Now, I want to just quickly quote some examples of what we 
are doing here in Congress in terms of writing frameworks for 
laws rather than the actual laws. But both Obamacare and Dodd-
Frank. And I always get them mixed up. But I think Dodd-Frank 
was 350,000 words. Obamacare was 380,000 words when passed. The 
last time I looked, about a year ago, Dodd-Frank was up to 15 
million words, and Obamacare was over 12 million words. An 
enormous amount of law being written by the agencies.
    And then the Supreme Court relies on the agencies in terms 
of how to interpret it; correct? Can you just kind of speak to 
that? Because you did allude to that in your testimony.
    Ms. Breuer. Yes, absolutely.
    It is sort of a fill-in-the-blank game. The regulations, 
the laws, and then subsequently the rules are written 
intentionally vague, in my opinion, so that, later on, the 
agency can mold that law to do what they want it to do.
    So one example is the Clean Power Plan. They are using 
Section 111 of the Clean Air Act that has so rarely been used 
that nobody really knows what it means. And they are relying on 
Chevron deference to be able to interpret that law to mean what 
they want it to mean.
    And that is exactly the concern with the Clean Water Act 
and the Waters of the United States rule as well. If they leave 
it vague, if they do not add clarity, then maybe not next year, 
maybe not the following year, but in 5 years, they are going to 
say, well, we really want more control over the farms and the 
hillside of Wisconsin, so this is what we really meant to say 
back then.
    And even more concerning is the holes that they leave in 
those regulations, leave the folks subject to those regulations 
open for citizen lawsuits. And any ambiguity in these 
regulations just encourages citizen lawsuits from Sierra Club 
or others which costs a lot of money to defend and bring no 
value to the farmers and the timber workers of Wisconsin.
    Senator Johnson. Can anybody here on the panel speak the 
process of sue and settlement?
    Ms. Breuer. I can speak a little as well.
    Senator Johnson. OK. Sure.
    Ms. Breuer. We see this in the utility industry on occasion 
where an environmental group or an NGO will bring a case 
against the EPA, trying to force the EPA to move in a certain 
direction. And then that group and the EPA will settle even 
though, relatively speaking, they Are on the same side. So they 
will settle. And then, the folks on the other side of the issue 
are not really brought into those discussions.
    And we have seen it with some of the past national ambient 
air quality standards. The utilities have to negotiate consent 
decrees with the EPA, and the State regulators have no say in 
that. So the utilities and the EPA agree to spend a certain 
amount of money on upgrading, your fire-power heater, your wood 
heater, or what have you. And then they bring it to the Public 
Service Commission of the State. And the Public Service 
Commission--the State regulators have no choice but to allow 
the utilities to do it and to charge it back to their 
customers. So it is an agreement between basically the 
environmentalists and the EPA. But they are using rate payer 
and taxpayer dollars to pay off that settlement. And it is 
frustrating, and it is a broken process.
    Senator Johnson. And it pretty well renders Congress pretty 
much useless----
    Ms. Breuer. That's right.
    Senator Johnson. And which means the people.
    Ms. Breuer. And State regulators as well.
    Senator Johnson. I think final line of questioning, I would 
like to talk to Mr. Ramme about the 2012 baseline.
    And I think, Mr. Meyer, you might have a different opinion 
on that.
    So can you just kind of talk a little bit about the way the 
EPA set those rules and why the 2012 baseline, which is really 
penalizing in terms of Wisconsin?
    Mr. Ramme. Well, if we look back at 2012, it was a year 
where the economy was not doing very well. And it was also a 
year that natural gas prices were unusually low. So that 
combination resulted in the natural gas generation facilities 
running much more than they ever had.
    Senator Johnson. Which would have lower CO2 emissions.
    Mr. Ramme. Right.
    Senator Johnson. OK.
    Mr. Ramme. And, of course, if those facilities are running 
and the economy is not going great, the coal facilities are not 
running as much. And so the CO2 emissions were much lower that 
year.
    But again, when you look at the cost of natural gas, it is 
not representative. And the CO2 emissions are not 
representative. And the coal plants running were not 
representative. It is very, advantageous to take a baseline 
year of 2012 and then look at reductions out in 2030 and--as 
you do that because you already have a head start there.
    Senator Johnson. Well, advantageous to who?
    Mr. Ramme. To the regulator.
    Senator Johnson. EPA?
    Mr. Ramme. And so that is why that really isn't, we feel--
--
    Senator Johnson. Mr. Meyer, you had a slightly different 
thought on that.
    Mr. Meyer. I do. But I will preface it by saying I am not 
an expert in this, and Mr. Ramme knows quite a bit.
    I made two points. One is, yes, if you had used 2005, a 
maybe advantageous base, but you have had to make more major 
reductions. And the estimate is half the companies of the 
utilities in the Nation would be complaining more than they are 
now, including some in the State of Wisconsin.
    I mean, while I was not involved in studying the baseline 
year for this, you can never pick a perfect baseline year. By 
definition, it is arbitrary and depends where you are as an 
individual company or a State. You may have a State that is in 
a slump, be treated differently, and some States roaring. So 
there is never a perfect number.
    In 2005 this would have resulted in, we believe, more 
complaints by utilities with regard to it.
    Now, the other thing that I think is important is to have 
the baseline year, but also, under the State plan--and I know 
Bruce and some other companies made reductions during the 2005, 
2012. And while that isn't taken into account in the baseline 
year, it can be taken into account in the compliance plan by 
the State of Wisconsin. And the State can adjust it saying this 
utility did quite a bit before then, so we are not going to 
impose as much. There is that kind of flexibility in the law--
or in the regulations to allow those judgments be given credit. 
Is it perfect? No.
    One thing that really concerns me about this rule is I am 
sure there could be a better rule than this, a better plan, but 
no one else is laying one out there. We have a climate change 
problem in this world. We need to deal with it. And I give 
credit to the EPA for doing it. It may not be perfect, but we 
need one.
    Senator Johnson. OK. Well, what I would like to do is give 
everybody an opportunity and just kind of wrap up the hearing 
and spend about a minute--I do not want you waxing on too long 
here. I want to respect everybody's time because people have 
been very patient. But if you have something that you really 
want to reveal or talk about that has not been either asked or 
you did not get an earlier opportunity----
    So we will start with you, Ms. Breuer.
    Ms. Breuer. Yes. I will just reiterate that, General 
Schimel and the State of Wisconsin feels that it is in the best 
interests of Wisconsin citizens to fight this type of 
regulatory overreach, not because we do not like the 
environment, but because we do think that it is State 
regulators and Wisconsinites who know our energy system best, 
who know our land best, and know the best way to use it. And we 
are the largest overreach we have seen in decades. And we are 
going to do everything we can from a litigation perspective to 
stop that.
    Senator Johnson. Thank you, Ms. Breuer. Mr. Vebber.
    Mr. Vebber. Yes. That was well said. And I would say that 
in Wisconsin, it has been said today that we make things. We 
are a manufacturing heavy State. We have members who use over a 
million dollars a month in energy. When you drive up the cost 
10 to 25 percent of that, that is a serious expense that is 
going to drive jobs out of our State. Manufacturers make up .15 
percent of the total customer base, but they use a third of the 
energy. If those manufacturers start leaving, that means that 
the rest of the energy costs in the State are going to go up 
dramatically on families and other businesses. And that is 
going to be devastating.
    So thank you, again, for allowing us to testify today, and 
I appreciate it.
    Senator Johnson. Mr. Holte.
    Mr. Holte. Well, I guess I would come back to the point I 
made earlier about the vagueness of the rule and the 
opportunity for it to change and be interpreted differently 
down the road with no opportunity for us to change that. And 
that vagueness gives us a great sense of discomfort.
    Senator Johnson. Mr. Schienebeck.
    Mr. Schienebeck. Like what I used to be, many of our 
members are independent businessmen. And we comply with 
everything we can comply with obviously. We care about the 
trees and the forests more than anybody. Because if you are a 
logger, the last thing you want to do is run out of trees to 
cut. And we have more trees now than we have ever had. I mean, 
we are well beyond the late 1800s and 1900s. And even then we 
did not actually run out of trees.
    And as an independent businessman, we are seeing more and 
more costs added on, and we have nowhere to pass those costs 
on. I mean, the utility company, they can raise my rates.
    If I am buying equipment when we are right in the final 
stage of a Tier 4 engine. That added $18,000 on to the cost of 
the machine. Now we are talking Tier 5 engine, and that is 
going to be probably $30,000 onto the cost with such a minute--
you talked about the teaspoons before. This would be a thimble 
for the gain of the cost. Quite honestly, we cannot afford to 
pay the costs anymore of these overreaching rules that have no 
benefit to them.
    Senator Johnson. Again, those trees did grow back, and they 
did have to have some CO2 to grow back.
    Mr. Schienebeck. Absolutely. And we had a Council on 
Forestry meeting today. And we just had another lesson about 
CO2. And we have trees, and they are absolutely (inaudible).
    Senator Johnson. I could not help myself. Mr. Ramme.
    Mr. Ramme. Well, I guess the last comment I would make is 
certainly to acknowledge that the legal challenges need to run 
their course. And hopefully they can occur in a timely fashion. 
And we have to get back to a balance of, environmental 
protection and considering the economy.
    Senator Johnson. OK. Mr. Meyer.
    Mr. Meyer. I started working for the Department of Natural 
Resources before the Clean Water Act, and before the Clean Air 
Act. And you could not eat the fish here in Stevens Point. You 
could not swim the rivers. Snowbanks were covered with soot and 
coal. And it did take Federal intervention to, in fact, cleanup 
those waters and lakes. We have done a good job, and the 
citizens have done a good job.
    We need Federal intervention on climate change. And this 
rule does it for the first time.
    Senator Johnson. Thank you, Mr. Meyer, for your efforts. 
And again, we agree on so much because we are here in 
Wisconsin, we love our environment, and we want to keep it 
clean.
    So, again, I just want to thank all the witnesses for your 
thoughtful testimony, for taking the time, for your thoughtful 
answers to my questions.
    I certainly want to thank UW-Stevens Point here for opening 
up this room. It is a beautiful facility. We appreciate that.
    And in particular, I want to thank Bill Rowe and his team 
and campus security.
    We want to thank all of the members of the audience in 
being very respectful, in taking the time to hear everybody 
out.
    This has been a good hearing. This is just a first step. We 
will, have a hearing in Washington D.C., and we will get the 
EPA in there, and we will hear their side of the story. And 
hopefully, they will also listen to some of these, I think, 
very legitimate concerns by business interests. This is going 
to affect our economy in some way, shape, or form. We can argue 
on exactly how much because it is just very difficult to 
calculate these things in perspective and even retrospectively. 
But it does have an economic impact, which is why this is of 
interest to this Committee.
    So again, I want to thank everybody for their attendance 
and their participation.
    The hearing record will remain open for 15 days until 
November 28 at 5 for the submission of statements and questions 
for the record.
    This hearing is adjourned.
    At 2:41 p.m., the Committee was adjourned.

                            A P P E N D I X

                              ----------                              


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



                                 [all]