    [Senate Hearing 114-532]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 114-532

    REVIEWING THE PROPOSED REVISIONS TO THE U.S. FISH AND WILDLIFE SERVICE
                               MITIGATION POLICY

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

                                    HEARING

                                   before the

                          SUBCOMMITTEE ON FISHERIES,
                              WATER, AND WILDLIFE

                                     of the

                                  COMMITTEE ON
                          ENVIRONMENT AND PUBLIC WORKS
                              UNITED STATES SENATE

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                               SEPTEMBER 21, 2016

                                   __________

      Printed for the use of the Committee on Environment and Public Works

    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

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

                                       ______

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    23-400 PDF                     WASHINGTON : 2017
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                   COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                        ONE HUNDRED FOURTEENTH CONGRESS
                                 SECOND SESSION

                      JAMES M. INHOFE, Oklahoma, Chairman
    DAVID VITTER, Louisiana              BARBARA BOXER, California
    JOHN BARRASSO, Wyoming               THOMAS R. CARPER, Delaware
    SHELLEY MOORE CAPITO, West Virginia  BENJAMIN L. CARDIN, Maryland
    MIKE CRAPO, Idaho                    BERNARD SANDERS, Vermont
    JOHN BOOZMAN, Arkansas               SHELDON WHITEHOUSE, Rhode Island
    JEFF SESSIONS, Alabama               JEFF MERKLEY, Oregon
    ROGER WICKER, Mississippi            KIRSTEN GILLIBRAND, New York
    DEB FISCHER, Nebraska                CORY A. BOOKER, New Jersey
    MIKE ROUNDS, South Dakota            EDWARD J. MARKEY, Massachusetts
    DAN SULLIVAN, Alaska

                     Ryan Jackson, Majority Staff Director
                   Bettina Poirier, Democratic Staff Director
                                  ----------

                 Subcommittee on Fisheries, Water, and Wildlife

                         DAN SULLIVAN, Alaska, Chairman
    JOHN BARRASSO, Wyoming               SHELDON WHITEHOUSE, Rhode Island
    SHELLEY MOORE CAPITO, West Virginia  THOMAS R. CARPER, Delaware
    JOHN BOOZMAN, Arkansas               BENJAMIN L. CARDIN, Maryland
    JEFF SESSIONS, Alabama               BERNARD SANDERS, Vermont
    ROGER WICKER, Mississippi            KIRSTEN GILLIBRAND, New York
    DEB FISCHER, Nebraska                CORY A. BOOKER, New Jersey
    MIKE ROUNDS, South Dakota            EDWARD J. MARKEY, Massachusetts
    JAMES M. INHOFE, Oklahoma (ex        BARBARA BOXER, California (ex
        officio)                             officio)

                                C O N T E N T S

                                  ----------
                                                                       Page

                               SEPTEMBER 21, 2016
                               OPENING STATEMENTS

    Sullivan, Hon. Dan, U.S. Senator from the State of Alaska........     1
    Whitehouse, Hon. Sheldon, U.S. Senator from the State of Rhode
      Island.........................................................     3

                                   WITNESSES

    Bean, Michael, Principal Deputy Assistant Secretary, Fish and
      Wildlife and Parks, U.S. Department of the Interior............     4
        Prepared statement...........................................     7
        Responses to additional questions from:
            Senator Inhofe...........................................    15
            Senator Sullivan.........................................    17
            Senator Barrasso.........................................    20
    Kindred, Joshua M., Environmental Counsel, Alaska Oil and Gas
      Association....................................................    32
        Prepared statement...........................................    36
    Yates, Ryan, Chairman, National Endangered Species Act Reform
      Coalition......................................................    40
        Prepared statement...........................................    42
    Colburn, Jamison, Professor of Law, Penn State University........    47
        Prepared statement...........................................    50

    REVIEWING THE PROPOSED REVISIONS TO THE U.S. FISH AND WILDLIFE SERVICE
                               MITIGATION POLICY

                                  ----------

                         WEDNESDAY, SEPTEMBER 21, 2016

                                   U.S. Senate,
             Committee on Environment and Public Works,
                Subcommittee on Fisheries, Water, and Wildlife,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 2:30 p.m. in room
    406, Dirksen Senate Office Building, Hon. Dan Sullivan
    (Chairman of the Subcommittee) presiding.
        Present: Senators Sullivan, Whitehouse, Barrasso, Boozman,
    Wicker, Fischer, Inhofe, Cardin, and Gillibrand.

                OPENING STATEMENT OF HON. DAN SULLIVAN,
                 U.S. SENATOR FROM THE STATE OF ALASKA

        Senator Sullivan. The Subcommittee on Fisheries, Water, and
    Wildlife will now come to order.
        I first want to apologize to everybody. We are trying to
    schedule some votes, especially to my colleagues, that we are
    going to be voting at 2:15, but I guess we are pushing that
    back. So my apologies.
        I want to thank everybody for being here to discuss what I
    think is an exceptionally important issue, the Fish and
    Wildlife Service proposed revisions to its mitigation policies
    and the impacts these could have on projects, economic
    projects, across the United States, including in my home State
    of Alaska.
        I know some of you have had to come from far away and
    shuffle competing demands on your schedule on short notice, so
    I very much appreciate everybody being here at the hearing.
        And I want to begin by saying something I think is pretty
    obvious on this Committee, but it is important to mention at
    the outset. We all certainly want to protect our wildlife, our
    environment. In my State, that is something that is near and
    dear to everybody, and we certainly have a strong record of
    doing that in Alaska, but we also need to take care of our
    citizens with economic opportunity.
        So this hearing gives us a chance to review the Service's
    broad proposal that has the potential to extend the scope of
    Federal review and consideration of infrastructure, energy, and
    private development and land use projects throughout the
    Nation.
        The Fish and Wildlife Service proposal, when added to the
    existing number of procedural and resource reviews for Federal
    actions and permits for private development, will increase
    costs, delay, or possibly paralyze projects, essentially
    withdraw lands, and discourage needed investment in many
    States. In short, broadly crafted and poorly explained policy
    proposals like the Service's proposed revisions may have
    significant economic impacts on economic growth and opportunity
    while doing little to protect the environment and the species.
        This is not some theoretical concern. For example,
    burdensome regulations and delays have created delay after
    delay on many large scale resource and economic development
    projects in our country. On average, right now it takes 5 to 6
    years to permit a bridge. Just to permit a bridge in the United
    States. Permitting a highway project can often take twice as
    long, up to 10 years. Again, just for the Federal permits.
        More specifically we had a case of the airport runway
    expansion at Sea-Tac Airport in Seattle; testimony on the
    Commerce Committee. Fourteen years to get the Federal permits.
    In Alaska it took 7 years, $7 billion to get an oil company to
    get one permit for an exploration well. Seven years. And we had
    a goldmine that took almost 20 years to go through Federal
    permitting.
        A recent report for the American Society of Civil Engineers
    found that there is an over $1.4 trillion funding gap for needs
    of infrastructure spending through 2025 for the United States.
    That is $1.4 trillion worth of roads, water, wastewater, basic
    utility, airport and port repairs, and investments that will be
    required to meet our Nation's infrastructure needs in the next
    decade.
        We all want to do that. We all need to think through the
    important ways to do that.
        In some places these U.S. investments will rebuild
    crumbling bridges and roads. But in other places, like my
    State, there is no infrastructure, no roads, no water and sewer
    projects in communities; and these infrastructure projects are
    necessary for lower priced goods, medicine, electricity, and
    water.
        On top of all these investments, our Nation still needs to
    strategically explore and develop energy resources, all types
    of energy resources, whether renewables or oil and gas.
        Again, when projects like roads or power lines are delayed
    or not built, it is often the most economically disadvantaged
    of our citizens who are hurt the most. I see this on a very
    regular basis in Alaska.
        As drafted, the Service's proposed revisions will add more
    complexity to the dizzying array of regulatory requirements,
    big and small, that all projects must face. The Fish and
    Wildlife Service is proposing to potentially veto projects by
    requiring a ``no action'' alternative in some cases.
        Let me be clear. The Fish and Wildlife Service has no
    authority under the law to veto an economic development
    project, period. There is none.
        Alaska's unique situation also raises concerns under the
    Fish and Wildlife Service broad revisions. Alaska was recently
    recognized by the Supreme Court in the Sturgeon case is
    different from the rest of the country in regards to our lands.
    Eighty-eight percent of Alaska is public lands, with only 1
    percent private sector ownership lands. Large proportions of
    these lands are undeveloped. Alaska contains more wetlands than
    the rest of the United States' States combined.
        Yet the proposed revisions are completely silent on the
    unique differences posed in Alaska or other States that have
    unique circumstances.
        Finally, as noted above, the scope of the authority
    asserted by the Service in its proposal is exceptionally broad
    and far from clear. The Service bases its authority to
    implement its new net gain or no net loss policy on no less
    than 26 statutes. It is a fundamental principle of
    administrative law that agencies must only exercise the
    authority delegated to them by Congress. It should cause us all
    concern, all my colleagues, that its own grant of authority
    from Congress to be implemented for policy revisions is so
    unclear at this stage of the proposal.
        I would like to conclude by just noting after the
    President's 2015 memo on mitigation, Federal agencies have been
    piling on additional regulatory requirements and served as so-
    called guidance and regulatory mandates. Such guidance must be
    authorized by Congress in Federal statute, and it must allow
    for not delay or prohibit economic opportunity that Americans
    so desperately need.
        I have serious doubts that this guidance meets either of
    these critical requirements and look forward to asking
    questions about these issues. Thank you.
        Senator Whitehouse.

             OPENING STATEMENT OF HON. SHELDON WHITEHOUSE,
              U.S. SENATOR FROM THE STATE OF RHODE ISLAND

        Senator Whitehouse. Thank you, Chairman.
        We are here today to examine the Fish and Wildlife
    Service's proposed revision to its mitigation policy. The Fish
    and Wildlife Service is the Federal Government's lead agency
    for protecting the plants, fish, and wildlife held in trust for
    the public. The agency has statutory authority to make sure
    there is a mitigation plan to protect natural resources
    affected by any development performed or funded by the Federal
    Government or that requires a Federal permit.
        The Fish and Wildlife Service is still operating under a
    mitigation policy that hasn't been updated since the first year
    of the Reagan administration.
        In the past 35 years we have made significant advances in
    the science of endangered species, habitat conservation, and
    climate change. For one thing, the Service is relying on a
    document that predates the first intergovernmental panel on
    climate change report by 9 years. We are now at the fifth
    iteration of that report.
        The revisions under review today are needed to bring the
    Fish and Wildlife Service into the 21st century and ensure that
    it provides consistent guidance on protecting America's natural
    spaces and native wildlife from a multitude of dangers,
    including those from climate change.
        In my home State of Rhode Island, we have already seen
    winter surface water temperatures increase by around 4 degrees
    Fahrenheit since the 1960s. Sea level at the Newport Naval
    Station tide gauge is up almost 10 inches since the 1930s. In a
    State tied so closely to its oceans and coasts--in 2013, Rhode
    Island's ocean economy generated $2.1 billion--these changes
    are serious. Rhode Island is not alone in seeing climate change
    undermine its natural resources, wildlife, and economy.
        I appreciate the Service's efforts to better incorporate
    the latest climate change science into its mitigation policy,
    and I encourage it to be more specific about accounting for
    climate change and resiliency in mitigation plans, some of
    which can cover decades of effort and monitoring.
        There is no question as to the Service's authority to
    promulgate the proposed revisions to its mitigation policy. The
    Fish and Wildlife Service cites 20 separate laws, 7 executive
    orders, and a multitude of regulations and administrative
    guidance documents that support its proposal.
        In his presidential memorandum from November 2015, the
    President set clear expectations for the Department of Interior
    and other Federal agencies to ``avoid and minimize harmful
    effects to land, water, wildlife, and other ecological
    resources caused by land and water disturbing events, and to
    ensure that any remaining harmful effects are effectively
    addressed consistent with existing missions and legal
    authorities.''
        The memorandum specifically calls for the use of landscape
    scale planning which coordinates mitigation projects on a
    larger scale to enhance conservation goals, and of policies to
    ``establish a net benefit goal, or at minimum a no net loss
    goal for natural resources.''
        With these proposed revisions to its mitigation policy, the
    Fish and Wildlife Service has set high expectations for its
    review of mitigation projects. This long overdue update is
    necessary to bring the Service's mitigation policy into the
    modern era and to provide increased consistency and
    transparency for non-Federal entities that work with the Fish
    and Wildlife Service and other Federal agencies.
        I thank our witnesses for being here today and look forward
    to the testimony.
        Thank you, Chairman.
        Senator Sullivan. Thank you, Senator Whitehouse.
        We do have two distinguished panels here today, and I want
    to thank, again, the witnesses for being here.
        I want to welcome our first witness, Mr. Michael Bean, who
    is the Principal Deputy Assistant Secretary for the Fish and
    Wildlife Service and Parks at the Department of Interior.
        Mr. Bean, you will have 5 minutes to deliver an oral
    statement, and a longer written statement will be included in
    the record.

         STATEMENT OF MICHAEL BEAN, PRINCIPAL DEPUTY ASSISTANT
    SECRETARY, FISH AND WILDLIFE AND PARKS, U.S. DEPARTMENT OF THE
                                INTERIOR

        Mr. Bean. Thank you, and good afternoon.
        Senator Sullivan. Excuse me, Mr. Bean. I apologize, but I
    think the vote has started, and as opposed to trying to cycle
    us through, if we can recess for a quick 10 minute recess, we
    will be back to hear your opening statement. Again, I apologize
    for the delay at the hearing.
        Thank you.
        [Recess.]
        Senator Sullivan. OK, we will reconvene the Subcommittee on
    Fisheries, Water, and Wildlife.
        Again, thank you for your patience, everybody. Apologize
    for that recess.
        Mr. Bean, the floor is yours for 5 minutes.
        Mr. Bean. Thank you, sir.
        Chairman Inhofe, Chairman Sullivan, Ranking Member
    Whitehouse, members of the Subcommittee, it is a pleasure to
    have the opportunity to testify before you today regarding the
    proposed mitigation policies of the U.S. Fish and Wildlife
    Service. I am Michael Bean, Principal Deputy Assistant
    Secretary for Fish and Wildlife and Parks at the Department of
    the Interior.
        Mitigation is an important and longstanding means of
    reconciling development activities with the conservation of
    fish and wildlife in their habitat. Mitigation encompasses a
    wide range of activities, including measures to avoid adverse
    impacts to wildlife, measures to minimize impacts that cannot
    practically be avoided, and measures to offset or compensate
    for those that remain.
        The Service generally plays one of two roles with respect
    to mitigation. In one it recommends to other agencies the
    mitigation measures that contribute to the achievement of
    priority conservation goals pursuant to a variety of statutory
    authorities. Examples are its recommendations pursuant to the
    Fish and Wildlife Coordination Act or the National
    Environmental Policy Act, NEPA.
        In other cases, the Service functions as a regulatory
    authority and requires mitigation measures of its permittees
    under various statutes that it administers. For example,
    permits issued under section 10 of the Endangered Species Act
    for take of listed species resulting from otherwise lawful
    development activities require applicants to minimize and
    mitigate the impacts of their projects to the maximum extent
    practicable. That is the statutory standard.
        Mitigation is not a new responsibility for the Service. The
    Service has been authorized by Congress to recommend measures
    to mitigate the impact of water resource development projects
    since the Fish and Wildlife Coordination Act of 1934, more than
    80 years ago. Decades of experience with mitigation under the
    Coordination Act, NEPA, and other laws led the Service to
    formulate a general mitigation policy in 1981.
        Recently, the Service has proposed two major policy
    documents relating to mitigation. The first, published last
    March, is a comprehensive revision of its 1981 gentle
    mitigation policy. The second, published in early September, is
    a stepdown policy specific to compensatory mitigation under the
    Endangered Species Act. Both were published in the Federal
    Register for public review and comment.
        With respect to the revised general mitigation policy, the
    Service is now evaluating comments received. With respect to
    the ESA compensatory mitigation policy, the comment period will
    remain open through October 17.
        The Service's two recent policy proposals were informed by
    its own practical experience and the evolution of mitigation
    science and policy since 1981. The goal of both policy
    proposals is to make mitigation recommendations and
    requirements more predictable, consistent, transparent, and
    effective. Neither policy proposal represents a radical
    departure from prior practice.
        Several key principles guide both proposed policies. They
    reaffirm the importance of the longstanding mitigation
    hierarchy in which practicable measures to avoid impacts are
    taken first, followed by measures to minimize those impacts
    that cannot practically be avoided, and finally measures to
    compensate for remaining impacts, if any.
        They emphasize the benefits of compensatory mitigation
    being done in advance of impacts. The proposed policies urge a
    broader look at where in the relevant landscape compensatory
    mitigation can have the greatest benefit to the affected
    resource, broadening the frame beyond the impact site.
        Recognizing that there are a variety of mechanisms for
    compensatory mitigation, including permittee of responsible
    mitigation, conservation banks, in-lieu fee programs, and
    habitat exchanges, the proposed policies make clear that
    regardless of the mechanism chosen, equivalent standards must
    be applied, creating a level playing field where the market-
    based mechanisms can flourish.
        Finally, the proposed policies set a goal of improving, or
    at a minimum maintaining, the current status of important,
    scarce, or sensitive resources as allowed by applicable
    authority and consistent with the responsibilities of action
    proponents.
        It is vitally important that we get the greatest
    conservation value for each mitigation dollar expended. The
    proposed policies are intended to improve the effectiveness of
    mitigation investments while at the same time improving the
    consistency, predictability, and transparency of mitigation
    decisions and providing opportunity for market-based mitigation
    mechanisms to achieve their full potential.
        Thank you for this opportunity to testify on the Service's
    proposed mitigation policies. We especially appreciate the
    opportunity to hear and discuss your interest in them. I would
    be glad to answer any questions you may have.
        Thank you.
        [The prepared statement of Mr. Bean follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Sullivan. Thank you, Mr. Bean.
        I am going to start with some questions just basically on
    some of the topics that I mentioned in my opening statement,
    and the one is the issue of delay.
        Do you think it is in the interest of the United States to
    have--it takes, on average, 6 years to permit a bridge--to get
    the Federal permitting requirements to permit a bridge?
        Mr. Bean. No, sir. I think delay is a genuine problem, and
    indeed it is a problem that our proposals are intended to
    address.
        Senator Sullivan. I was going to give you a rundown of some
    of the delays. They're outrageous, right? Fourteen years to
    permit a runway; 20 years to permit a goldmine; 7 years to get
    permission to drill one exploration in 100 feet of water. I
    mean, this is the sound of the economic decline of the country,
    in my view.
        So I am not going to run through those because you already
    stated that you don't disagree that that is a problem, so thank
    you for that.
        Let me speak to what the Corps, another Federal agency, has
    said about your proposed regs, your proposed guidance. This is
    the Corps of Engineers. Knows a lot about projects, knows a lot
    about protecting the environment, knows a lot about,
    unfortunately, projects that take too long. This is their
    submitted comments on your proposed regulation: ``Our
    experience is that the Fish and Wildlife staff are
    extraordinarily busy, to the point where handling existing
    requirements in a timely manner can be challenging.'' Just what
    you got right now. ``Therefore, requiring Fish and Wildlife
    staff to take the lead,'' and that is what many people think
    you are trying to do here, take the lead, ``in these types of
    determinations may only exacerbate the problem.''
        Again, this is your fellow brother-sister agency
    essentially saying this is going to create more delays. ``We
    believe that it might be more efficient and effective for Fish
    and Wildlife staff to simply review materials for acceptability
    and consistency with the policy recommending any needed
    changes.'' So your traditional role.
        So other Federal agencies in the Obama administration are
    worried that this rule is going to actually require more delays
    and have you guys take on too much work. What do you say in
    response to the Corps of Engineers, that knows a lot about
    these issues?
        Mr. Bean. Yes, the Corps does, and we have learned a good
    deal about mitigation from the Corps' own experience. Our view
    is that we believe, through our proposals, that we can be more
    efficient, more effective by being more transparent, more----
        Senator Sullivan. So you think having another layer of
    Federal permitting requirements is going to make it more
    efficient to get projects done? The Corps of Engineers doesn't
    believe that. They are trying to be polite, but it is very
    clear that they don't believe that.
        Mr. Bean. We are not creating another layer of review.
        Senator Sullivan. You are not?
        Mr. Bean. No, we are not.
        Senator Sullivan. Explain how you are not creating another
    layer of review.
        Mr. Bean. Well, when there is an existing requirement for
    input from the Fish and Wildlife Service to the Corps, for
    example, under its Clean Water Act authority, section 404(m), I
    believe it is, gives the Fish and Wildlife Service the
    authority, and indeed the obligation, to recommend to the Corps
    its views with respect to mitigation.
        Senator Sullivan. Why do you think the Corps submitted
    these comments? It is pretty extraordinary, right? They
    obviously work with you guys closely. They don't seem to be
    fans of your policy. Why do you think they submitted and know
    that you are already having a hard time keeping up with
    permitting projects on a timely basis right now? They are
    clearly indicating that this is going to make that worse. Why
    do you think they submitted those comments?
        Mr. Bean. Well, our view is that this will not make that
    matter worse; it will make it better.
        Senator Sullivan. OK, they disagree.
        Mr. Bean. They may disagree, but that is for them to say.
        Senator Sullivan. So you can you commit to me that this is
    not going to cause any additional layer of bureaucracy and any
    additional delay on these critical, critical economic projects
    that our country needs so desperately? We are not growing our
    economy, and a lot of the reason is it takes forever to permit
    anything. Can you commit to me that that is not going to happen
    with this new proposed regulation?
        Mr. Bean. I believe it will not happen. I know that it is
    the intent to keep that from happening, and I believe it will
    be the case that we will be more efficient and more effective
    with these measures than we are today.
        Senator Sullivan. Another issue that I have a lot of
    concerns about is just the legal authority to where you are
    going on a number of your policy calls. The first and foremost
    is in the President's memo, the no net loss net gain policy.
    That is a pretty big policy call, wouldn't you say?
        Mr. Bean. It is an important measure, but I think it has
    perhaps been misunderstood. I can give you an example from
    Senator Inhofe's State. Oklahoma and four other States together
    put together a range-wide conservation strategy for the lesser
    prairie-chicken, and that is basically a mitigation program,
    and as a key part of that program which functions by generating
    credits from activities that benefit that species, then making
    those credits available to offset impacts from oil and gas and
    other activities. What the States creatively have done is to
    provide that some portion of the credits generated will never
    be used to offset impacts, and thus, programmatically, they
    will achieve a net benefit, a net conservation benefit.
        Senator Sullivan. OK, well, I am going to get back to that
    because that is a big policy call; it is a role for the
    Congress to make that call. And when I follow up, I want to be
    respectful to the other members here, but I don't believe that
    is laid out in any statute, any statute by which you get your
    authority, and that is a policy call that should be made by the
    Congress of the United States, not by a Federal agency that
    doesn't have that authority.
        Senator Whitehouse.
        Senator Whitehouse. Thanks, Chairman.
        Welcome, Director Bean. I appreciate you being here.
        Let's pick up on the no net loss policy. That is kind of a
    baseline to inform your efforts. Tell us in simple terms what
    it means, and tell us in simple terms whether it is a novelty
    under this new guidance.
        Mr. Bean. It is not a novelty in general because the no net
    loss notion was first floated and embraced by President George
    H.W. Bush in 1988, who articulated that as his goal for
    mitigation under the Clean Water Act, and it has become
    established as the mitigation goal for the Clean Water Act in
    the ensuing 30 years. The Fish and Wildlife Service, in its
    1981 policy, has a similar no net loss goal for important
    resources.
        Senator Whitehouse. That would be 35 years ago in that
    case.
        Mr. Bean. Yes, indeed. So it is not novel. But what is, I
    think, important is some of the ways in which we can accomplish
    that goal. I tried to give the example of lesser prairie-
    chicken as an illustration of how sometimes it is possible to
    do that relatively creatively and somewhat easily.
        Senator Whitehouse. The concern that Senator Sullivan has
    for unnecessary delays and problems and bureaucracy, I think,
    is a very legitimate concern, and I hope that the Service will
    take that to heart in the way it implements the new policy or
    the new guidance.
        Mr. Bean. Yes, sir. Let me just say that we were very much
    aware of the delays of the sort the Chairman described when we
    set out in this Administration to authorize various wind and
    solar projects on public lands in the west, and we were able to
    approve many of those projects relatively quickly, certainly by
    comparison to the statistics the Chairman gave. We did so in
    large measure by early coordination amongst several Federal
    agencies, Federal, State, and sometimes local agencies, all of
    whom have permitting responsibilities of one sort or another,
    and we found that by coordinating those efforts early on we
    could achieve some real efficiencies and time savings.
        Senator Whitehouse. For what it is worth, it is in a
    different context, but we deployed very coordinated permitting
    in our Federal waters and as a result were the first State in
    the country to be able to build offshore wind. We shot by both
    Massachusetts and Delaware and other States because we had done
    a good job of coordinating the permitting into a much more
    convenient and singular process, and the private sector folks
    who invested in and built the offshore wind program are huge
    fans of that coordinated permitting. Again, it is a different
    area, but I think the process savings were evident in that as
    well.
        One other point. One of the chemical consequences of amping
    up the CO2 levels in our atmosphere to 400 parts per
    million and above has been the chemical reaction of the oceans,
    which is to acidify. They are measurably acidifying more
    rapidly than any time in human history that we can find. And
    that will have considerable effects on ocean creatures of
    various kinds, whether it is the terrapod that is the base of
    the food chain in Senator Sullivan's side of the world or the
    corals that are so important to Florida's economy, or the clams
    and oysters that Rhode Island grows so effectively.
        Are you looking at the impact of ocean acidification on
    species as a question worth considering under the Endangered
    Species Act authorities?
        Mr. Bean. Certainly, sir, it is a serious problem,
    apparently one that is growing in significance. We are looking
    at it, although I would note that the National Oceanic
    Atmospheric Administration has primary jurisdiction over marine
    creatures. The Fish and Wildlife Service has relatively limited
    authority over marine creatures, so it is primarily NOAA's lead
    on this issue. But we certainly are aware of the problem and
    recognize that it is a problem, and when it does affect species
    or other resources for which we are responsible we need to take
    it into account as part of our overall science-based analysis
    of the problem and its solutions.
        Senator Whitehouse. And in any event, when you are looking
    at a potentially multi-year plan like the prairie-chicken plan,
    you have to take the known facts of what is happening in that
    creature's environment from climate change into account as part
    of the scientific baseline against which you make your
    determinations, correct?
        Mr. Bean. Yes, we do need to do that, and the information
    to do that varies in quality, but where we have the information
    that we can rely upon we very definitely need to and do use
    that information.
        Senator Whitehouse. Thank you.
        Senator Sullivan. Chairman Inhofe.
        Senator Inhofe. Thank you.
        Both Chairman Sullivan and Ranking Member Whitehouse are
    very well respected attorneys, and I am not a lawyer, so there
    might be a very simple answer to this, but your mitigation
    policy adopts a position that mitigation should take place in
    advance of project construction. Now, in section 906 of WRDA,
    that was the 1986 WRDA, Congress authorized the Corps to do
    mitigation as a project is being built; and then again in 1999,
    section 119 of title 23, that is the Highway Federal Code, the
    Federal law limits which mitigation can happen in advance of
    construction, even if the mitigation is voluntary.
        So the question I would have is by what authority would you
    have this mitigation in advance?
        Mr. Bean. Well, let me begin by saying that the policy is a
    policy that does not purport to change statutory authority, so
    to the extent that there are statutory mandates or authorities
    that are in conflict with the policy, those prevail. What the
    policy articulates is where there is discretion as to the
    timing of mitigation, it is desirable, it is preferred to have
    it done in advance or contemporaneously with the impacting
    activities.
        It has been our experience over the years that when
    activities that impact the environment are done first and
    mitigation comes later, that often leads to problems. The
    mitigation sometimes fails, for example; and thus there are
    temporal losses for which you can never fully recover. But the
    policy is one that is designed to influence where we have the
    discretion as to the timing, the choice, in favor of early
    mitigation activities.
        Senator Inhofe. And would you say that when it is done in
    advance that lengthens or shortens the time for ultimate
    consideration?
        Mr. Bean. It actually shortens it quite considerably. A
    good example of that are the various mitigation banks, of which
    there are now over 1,000, I believe, under the Clean Water Act,
    these make it possible for Corps of Engineers permittees to
    quickly get permits and quickly fulfill their mitigation
    responsibilities by buying credits from established successful
    banks.
        Senator Inhofe. All right.
        Mr. Chairman, I am going to reserve some time because I
    need a little more time on the second panel.
        Senator Sullivan. OK. Thank you, Mr. Chairman.
        Senator Cardin.
        Senator Cardin. Well, thank you, Mr. Chairman, for calling
    this hearing on the update of the mitigation policies of the
    Fish and Wildlife.
        Was 1981 the last time that we have looked at this? If my
    math is correct, the amount of developed acres in the lower 48
    States since 1981 has increased by about 70 percent since that
    time, from about 70 million developed acres to about 120
    million developed acres. That is a tremendous increase.
        Our knowledge of climate change and the impact of climate
    change has changed so dramatically in the last 35 years. Our
    expertise on how to deal with the impact of climate change has
    changed very dramatically over the last 35 years.
        I call to my colleagues' attention that on Tuesday we will
    have the ribbon cutting in Queen Anne's County, Maryland, of
    the living shoreline. It will be the first cobblestone and sand
    shingle beach project in the United States, and the Maryland
    Department of Natural Resources worked together with engineers
    to research and design this innovative shoreline stabilization
    project which aims to protect the beach from erosion by serving
    as a natural barrier to currents and tides, and increase the
    presence of marsh grasses that provide habitat for wildlife.
        We didn't know what that was all about 35 years ago. That
    technology just wasn't even thought to be possible.
        We have Smith Island, a habitable island in the Chesapeake
    Bay that I think 35 years ago they thought there was no way
    that we could preserve that land. Today people are still living
    on Smith Island, and I want to make sure they still have a
    place to live. And we have contributed to ways in which we can
    help the environment and help where people live.
        So I guess my question is what is the objective here? What
    are we trying to do by these revisions and plans? We know that
    diversity of species if critically important to our environment
    and to our future. We know habitats have been destroyed because
    of climate change and development. What is the objective that
    Fish and Wildlife is attempting to do by these revisions?
        Mr. Bean. Thank you, Senator. The objective is to have a
    mitigation program that is more effective, more efficient, more
    predictable, and more transparent. You are correct that the
    1981 policy, since that policy was promulgated, we have learned
    a good deal. The changes you have cited are real. I think the
    most important aspect of this policy is its directive to make
    mitigation decisions in a landscape context, and what I mean by
    that is the following: in 1981 and for many years thereafter
    there was an almost reflexive view that mitigation should take
    place as close to the point of impact being mitigated as
    possible. Under this policy we are asking people to take a step
    back and look at where the mitigation can do the most good, and
    that is a big change because what it will mean is that we won't
    necessarily be tied to just mitigating at the point of impact
    if we can find a better place for the resource to do that
    mitigation. And I think that is really the most important
    aspect of this policy change.
        Senator Cardin. I was listening to the Chairman and his
    desire to try to balance our protection of the environment with
    the need for economic growth. You said something that I think
    is very, very important that we all should be able to agree on,
    and that is we need a transparent process and a predictable
    conclusion so that a developer or government knows what to
    expect as they try to determine whether they want to make an
    investment or how they are going to deal with the realities of
    the challenges that they have.
        So I just really want to underscore that point about
    predictability and an open process. If I understand correctly,
    you are committed to the end result leading to predictable and
    understanding of what the requirements of mitigation are all
    about.
        Mr. Bean. Yes, sir, that is the objective. Again, to cite
    the example of the lesser prairie-chicken, the participants at
    that program know exactly what it will cost based upon the
    development activities that they are planning, the acreage they
    will affect, and whether that acreage is in the highest
    priority or the middle priority or the lowest priority
    habitats. They can do a quick calculation of what it will cost
    and decide whether they want to proceed. So it is a very
    predictable scheme, and it is the sort of thing that we would
    like to do more broadly.
        Senator Cardin. Thank you.
        Thank you, Mr. Chairman.
        Senator Sullivan. Senator Boozman.
        Senator Boozman. Thank you, Mr. Chairman.
        And thank you for being with us today. The draft policy
    requires the Fish and Wildlife Service to use a valuation
    species for assessing required mitigation. More so, the draft
    policy requires the Service to identify habit values to support
    these evaluation species by designating them as high importance
    or high value. Habits of high importance are described as
    irreplaceable or difficult to replace.
        Has the Service made everyone aware of what makes a habitat
    irreplaceable?
        Mr. Bean. I think the Service has tried to convey clearly
    what that concept means. There are certain examples, and I
    would give you an example from the west, peat habitats, wetland
    habitats that accumulate peat at a rate of about 1 foot per
    1,000 years. Impacts to those habitats are, for all practical
    purposes in terms of our lifetimes and our grandchildren's
    lifetimes, irreplaceable. So that is an example of several that
    I would try to convey.
        Senator Boozman. And I appreciate the example, but have you
    got in writing someplace the principle of the example?
        Mr. Bean. I think so, sir. I think that the proposed policy
    makes clear that irreplaceable resource are those for which we
    either lack the means of recreating or restoring them, or the
    means are so time consumptive and resource consumptive as to be
    impractical.
        Senator Boozman. So how do you mitigate something that is
    irreplaceable?
        Mr. Bean. Well, the Fish and Wildlife Service's view is
    that for an irreplaceable resource, the proper response is
    avoidance. Now, we recognize that maybe our recommendation, but
    the agency to whom we make the recommendation may not take that
    recommendation, in which case we would then strongly urge that
    agency to take whatever minimization measures are practical.
        Senator Boozman. So once you deem something irreplaceable,
    it is very difficult, then, to mitigate?
        Mr. Bean. Yes, it is very difficult to mitigate, and the
    Service recommendation would be to avoid impacts.
        Senator Boozman. I think it would be good if we knew very
    clearly since you can't mitigate it, I think it is important
    that you very clearly state what is deemed irreplaceable.
        Mr. Bean. Sure. Let me emphasize one point. Mitigation is a
    term that encompasses a range of activities, including
    avoidance, minimization, and compensatory actions. So when you
    say something can't be mitigated, I don't want to leave the
    impression that you can't do things to minimize impacts to it.
    That, too, is a form of mitigation.
        Senator Boozman. Is there a possibility that irreplaceable
    could arbitrarily apply to other categories, such as minerals?
        Mr. Bean. Such as what, sir?
        Senator Boozman. Minerals.
        Mr. Bean. Not under our policy. The resources to which our
    policies apply are wildlife and their habitats.
        Senator Boozman. OK. Very good.
        Thank you, Mr. Chair.
        Senator Sullivan. Thank you, Senator Boozman.
        I am going to follow up just with a few questions. I think
    this topic on the legal authority, which is something that we
    have discussed a number of times in this Committee, which is a
    really important issue.
        So, Secretary Bean, you agree that the Fish and Wildlife
    Service does not have just unfettered discretion to make policy
    calls, right, without the regulatory, statutory authority from
    the Congress, correct?
        Mr. Bean. The Fish and Wildlife Service is required by law
    and does follow the statutory mandates applicable to it, yes,
    sir.
        Senator Sullivan. So even when you cited whether it is
    President Obama's memo or even you cited President George H. W.
    Bush, the two Presidents don't have the ability to make
    statutory policy calls, do they?
        Mr. Bean. Only Congress does that, sir.
        Senator Sullivan. So that is clear. Only Congress does.
    Whether you are citing the 2015 memo or a former President, if
    they are acting without statutory authority it doesn't matter
    what they say, correct, or what their memos say?
        Mr. Bean. It doesn't matter, although statutory authority
    is often granted in rather general terms, leaving them quite a
    bit of discretion.
        Senator Sullivan. Correct. But let me get back to this no
    net loss or net gain. That is a pretty major statutory policy
    call, isn't it?
        Mr. Bean. It is certainly a major policy call, yes, sir.
        Senator Sullivan. So what I would like you to do, and if
    you can't do it here, of the 26 statutes that you cited, I
    would like to know exactly where that policy is laid out, in
    which statute. My team has looked, and we haven't been able to
    find it at all, so my concern is, whether it is President
    Obama's 2015 memo, you are making policy, major, major policy
    calls that are the realm of the Congress. So right now, for
    example, even section 10 of the ESA, which authorizes
    incidental take permits, does not require a net gain or no net
    loss.
        Again, we haven't been able to find that anywhere, so can
    you just tell me where? And don't give me 26 statutes. I want
    the statute, and I want the language in the statute that says
    it is the policy of the United States to have no net gain or no
    net loss. I mean, I am sorry, net gain or no net loss.
        Mr. Bean. What you will find in all of those statutes, I
    believe, just as you find in the Endangered Species Act----
        Senator Sullivan. Endangered Species Act doesn't have it.
    The Migratory Bird Act doesn't even talk about mitigation.
        Mr. Bean. That is correct. But the Endangered Species Act
    does, and it requires, in the case of section 10 permits, that
    the impacts be mitigated and minimized to the maximum extent
    practical.
        Senator Sullivan. Right. That is not no net gain. That is
    not no net loss. That is a very different. That is the
    standard, you are exactly correct.
        Mr. Bean. That is the statutory standard.
        Senator Sullivan. Correct. So how do you get from there to
    no net loss or gain? That is a very different standard.
        Mr. Bean. If it is practicable, for example, to achieve no
    net loss, then that is entirely consistent with that goal.
        Senator Sullivan. No, but you are saying that the net
    policy is--the President's memo says the new policy is no net
    loss, or indeed, net gain. And I am saying there is nowhere in
    any statute that we can find that lays out that policy. So you
    are making policy, whether it is the President or you. And you
    have no authority to do that. So what section of what statute
    gives you that----
        Mr. Bean. If you are asking, sir, do those precise words
    appear in the statute?
        Senator Sullivan. Correct.
        Mr. Bean. The answer is no. Instead, what we have in all of
    those statutes, or nearly all of those statutes, is a directive
    and an authorization to mitigate.
        Senator Sullivan. Correct.
        Mr. Bean. And the Service----
        Senator Sullivan. I don't disagree with that. Mitigate is
    very different than no net loss or a net gain. It is very
    different. That is what I am talking about. This is a major
    policy call that you are usurping the authority of the Congress
    on this issue.
        Mr. Bean. Well, I don't think the Service views it that
    way, sir. I think the Service views that it has discretion
    authorized by Congress----
        Senator Sullivan. It doesn't have discretion to make new
    policy when the policy is stated in the law.
        Mr. Bean. It has the discretion to interpret what Congress
    has said, and that is what it has tried to do.
        I would add one other thing which is important, which is
    both the Service policies and the President's memo make clear
    that they do not override statutory restrictions.
        Senator Sullivan. Yes, but you can say that, but in
    practicality that is exactly what you are doing. You are
    essentially admitting it here. Mitigation under the ESA is very
    different. The standard you are citing, which I agree with, in
    the ESA is very different than a standard, a policy directive
    of no net loss or net gain. They are apples and oranges. And
    you are now saying that you have this authority, when we can't
    find it anywhere in any statute.
        Mr. Bean. Well, let me point you to one other provision of
    the Endangered Species Act, section 4(d), which authorizes the
    Secretary to have such regulations as are necessary and
    advisable for the conservation of a threatened species. It is a
    broadly worded authorization. If the Secretary were to find, as
    she did in the case of the lesser prairie-chicken, that it was
    necessary and advisable for the conservation of that species to
    have a regulation that required participation in the State
    generated plan which itself requires a net conservation gain,
    that is fully consistent with the language of the statute.
        Senator Sullivan. I would just, and maybe you can do it
    again, I don't want to belabor the point, but if you can give
    us the statutes and the language that lay out the statutory
    mandates on that policy, I would like to see it, because I
    don't think it exists.
        And let me ask one other one with regard to the veto. You
    do have a provision in here that allows you to recommend no
    action. Now, it is very vague, and I don't exactly understand
    what you are trying to do in the new regs, but if you are
    trying to say somehow that you have authority to veto projects,
    when you are not even the lead on these projects, that again is
    way, way beyond your statutory authority.
        What are you trying to do with that no action provision in
    your new policy?
        Mr. Bean. Our recommendations are just that, sir,
    recommendations. We have been very clear in this policy that
    where we have irreplaceable resources our recommendation will
    be to avoid impacts. That is the appropriate thing for the Fish
    and Wildlife Service to do in light of the responsibility that
    this Congress has given it, to be vigilant, if you will, in the
    conservation of wildlife. That is our role.
        The agencies to which we make those recommendations are
    free to make the ultimate decision, but they need to have that
    decision made based upon input from us as an agency charged by
    law with understanding in recommending what is best for
    wildlife.
        Senator Sullivan. Thank you.
        Senator Whitehouse.
        Senator Whitehouse. Director Bean, I don't, frankly, think
    you need my help in this exchange, but I do want for the record
    to say that where the statute says that it is the goal and task
    conferred by Congress on the Fish and Wildlife Service to see
    to it that, where there is harm to wildlife or habitat, that
    that harm shall be mitigated to the extent practicable. That is
    a pretty clear statement to me, but it is also very general
    language.
        So, to me, for the Service to then say here is a standard
    that we believe would meet our responsibility to mitigate the
    harm to the species or habitat to the extent practicable, and
    that is that there is no net loss; that if you are going to
    harm it here, and you bring back the same amount there, that
    meets our standard.
        I think it is a question of trying to actually provide
    clarity to the original definition. So just from my
    perspective, I am completely comfortable that the no net loss
    standard is legitimate and clear regulatory implementation of a
    statute well within its terms, which is probably why Presidents
    since President Bush have stood by it.
        So I don't mean to belabor this point any further, but at
    least from my point of view, I wanted to have my opinion on
    this in the record. So thank you.
        Senator Sullivan. Thank you, Senator Whitehouse.
        Director Bean, thank you for your testimony. Much
    appreciated.
        I am going to ask the second panel to come up to the dais
    here, and I want to welcome Mr. Joshua Kindred, who is the
    Environmental Counsel of the Alaska Oil and Gas Association;
    Mr. Ryan Yates, Chairman of the National Endangered Species Act
    Reform Coalition; and Mr. Jamison Colburn, Professor of Law at
    Penn State.
        You will each have 5 minutes to deliver your oral
    statement, and a longer written statement will be included in
    the record.
        Gentlemen, if you can please join us now. Thank you again
    for coming here. Sorry again about the delays in the hearing.
        Mr. Kindred, I would like to begin with you. You have 5
    minutes to deliver your statement. Thanks again.

     STATEMENT OF JOSHUA M. KINDRED, ENVIRONMENTAL COUNSEL, ALASKA
                        OIL AND GAS ASSOCIATION

        Mr. Kindred. Thank you, and good afternoon, Chairman
    Sullivan, Ranking Member Whitehouse, and members of the
    Committee. My name is Josh Kindred. I serve as Environmental
    Counsel for the Alaska Oil and Gas Association, or AOGA. AOGA
    is a professional trade association whose mission is to foster
    long-term viability of the oil and gas industry to the benefit
    of all Alaskans. AOGA's members have a long history of proven
    environmentally responsible oil and gas exploration development
    in Alaska, and we appreciate the opportunity to provide
    testimony today.
        In an effort to sort of avoid duplicative testimony, and I
    don't know if I will succeed in that, I will proceed directly
    to the substantive issues and concerns that AOGA has, and they
    fall effectively in three categories: first, as Senator
    Sullivan pointed out, an inability to reconcile achieving a net
    benefit, or at minimum no net loss standard with the statutory
    sources available for the Service; second, issues and concerns
    regarding ambiguity and incompatibility; and finally, how ill-
    suited the draft policy is for meaningful implementation.
        Now, according to the draft policy, under the memorandum,
    all Federal mitigation policies shall clearly set a net benefit
    goal, or at minimum a no net loss goal for natural resources
    wherever doing so is allowed by existing statutory authority
    and is consistent with agency mission and established natural
    resources objectives. The fundamental problem with the
    Service's draft policy is that the primary sources of the
    Service's authority provide no basis for and are irreconcilable
    with the imposition of a net benefit or no net loss mitigation
    standard.
        The fundamental flaw is particular evident when examined in
    the context of the Endangered Species Act. The ESA provides no
    authority for the Service to impose mitigation measures upon
    private applicants that will result in a net benefit or no net
    loss. For example, in the section 7 consultation, the Service
    is charged with ensuring that any federally approved action
    that may affect listed species is not likely to jeopardize the
    continued existence of a listed species or destroy or adversely
    modify their critical habitat.
        The Service prepares a biological opinion to explain it in
    document section 7 determinations for actions that are not
    likely to jeopardize listed species or cause adverse
    modification of critical habitat but that may, nonetheless,
    result in incidental take of a listed species, and the Service
    will include an incidental take statement in the biological
    opinion.
        Under these statutory and regulatory provisions, a non-
    jeopardizing action under ESA section 7 may have some impact on
    listed species and critical habitat and may result in
    incidental take of listed species. The Service's authority in
    this context is simply to recommend measures that minimize the
    impact of the incidental take. These measures may only result
    in minor changes to the project. Neither the ESA nor its
    implementing regulations contain any authorization for the
    Service to require or recommend measures in a section 7
    consultation to ensure that the Federal action results in a net
    gain or no net loss.
        Any action taken by the Service to recommend such measures
    would exceed the Service's statutory authority under, and
    therefore violate, section 7 of the Endangered Species Act.
        Similarly, when the Service issues a permit under section
    10 of the ESA, it must ensure that the permit applicant will,
    to the maximum extent practicable, minimize and mitigate the
    impacts of the incidental take authorized by the permit. These
    statutory provisions also give no authority to the Service to
    impose measures that will result in a net gain or no net loss.
    Rather the Service must ensure that the applicant minimizes and
    mitigates the impact on listed species to the maximum extent
    practicable.
        Nowhere in the draft policy does the Service grapple with
    the fact that the scope of its authority under section 7 and 10
    of the ESA is irreconcilable with the net benefit, or at
    minimum no net loss standard policy adopted by the draft
    policy.
        The draft policy explains that it is intended to clarify
    the role of mitigation in dangerous species conservation but
    also notes that nothing herein replaces, supersedes, or
    substitutes for the ESA's implementing regulations.
        Respectfully, the Service's acknowledgments of its
    obligations under the ESA, while correct, do little to address
    the fact that the draft policy nevertheless purports to apply a
    standard that is fundamentally incompatible with both the ESA
    and its implementing regulations. The Service's competing
    positions that it will both apply a policy to ESA actions that
    is contrary to the ESA and that it will respect the authority
    of the ESA when implementing the draft policy cannot be
    rationalized.
        If Congress had intended to require that every impact to
    listed species be completely offset, it would have written such
    a requirement into the ESA. If the Service or the President
    desires such a result, Congress must first act by amending the
    ESA to provide the authority to the executive branch.
        The draft policy's incompatibility with statutory authority
    is not unique to the ESA. Indeed, we are aware of no sources of
    statutory authority that authorizes the Service to require a
    net benefit mitigation for Federal actions undertaken by
    citizen applicants.
        For example, under section 101 of the Marine Mammal
    Protection Act, private citizens may obtain authorization to
    take small numbers of marine mammals incidental to lawful
    activity so long as the take has no more than a negligible
    impact on the affected marine mammal species or stock and will
    not have an unmitigable adverse impact on the availability of
    such species or stock for taking for subsistence uses.
        The Service has no authority under the MMPA to require
    recipients of incidental take authorizations to take actions to
    achieve a net benefit or no net loss to the affected marine
    mammal species or stock.
        Similarly, under the National Environmental Policy Act, or
    NEPA, agencies are required to identify appropriate mitigation
    measures in the discussion of alternatives and in an
    environmental impact statement. Such measures are not required
    to achieve a net benefit or no net loss. Moreover, the Supreme
    Court has established that NEPA provides no substantive
    authority to Federal agencies to require mitigation, nor does
    it impose a substantive duty to develop a complete mitigation
    plan and an EIS.
        Furthermore, one unintended consequence that the Service
    may not have contemplated is that the draft policy's
    articulation of a net conservation gain mandate might result in
    regulatory takings. The U.S. Supreme Court has held that a
    regulatory taking occurs when the Government conditions
    approval of a land use permit on the dedication of property or
    money to the public unless a nexus or rough proportionality
    exists between the Government's requirement and the impacts of
    the proposed land use.
        If the draft policy dictates that the Service will
    condition the approval of a land use permit on a net
    conservation gain standard, the amount of compensatory
    mitigation may lack the requisite nexus or rough
    proportionality to the impacts of the proposed land uses and
    thus result in a taking.
        Finally, the draft ESA policy does not, but should, take
    into account the fact that the ESA plays a much different role
    in Alaska than the lower 48 States. In the last 10 years there
    have been ESA listings of very abundant, presently healthy, and
    wide ranging species in Alaska based on protected habitat
    conditions at the end of the century.
        For example, the Arctic green seal population numbers in
    the millions and occupies a range far larger than any other
    listed species. As another example, almost 200,000 square miles
    of land in offshore waters in Alaska have been designated as
    polar bear critical habitat.
        Much of the resource development in Alaska occurs through a
    structured Federal process, while either Boehm or BLM in the
    oil and gas leasing process, that already take into account the
    avoidance, minimization, and mitigation of impacts to federally
    listed species. For example, Boehm has identified and
    conditioned offshore leases on related permits based in part on
    the presence of listed species.
        In addition, almost every project in Alaska falls under the
    jurisdiction of the Army Corps of Engineers, which already
    applies stringent compensatory mitigation measures under the
    Clean Water Act. Accordingly, aside from being beyond the scope
    of authority granted by the ESA, additional action by the
    Service to require or recommend compensatory mitigation through
    the ESA would unnecessarily complicate and duplicate a Federal
    project approval system in Alaska that already accounts for and
    mitigates impacts to listed species and their habitat.
        We understand that the President and the Department of
    Interior are motivated to broadly implement new policies to
    achieve net gains or no net loss of environmental values. But
    those policies, however well intended they may be, cannot be
    implemented without statutory authority. The draft policy is
    fundamentally flawed because it is entirely premised on
    achieving a standard that cannot be lawfully implemented by the
    Service under the Service's existing sources of statutory
    authority. Because of this overarching flaw, the draft policy
    should be withdrawn and rewritten.
        Thank you.
        [The prepared statement of Mr. Kindred follows:]

      [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Sullivan. Thank you, Mr. Kindred.
        Mr. Yates.

    STATEMENT OF RYAN YATES, CHAIRMAN, NATIONAL ENDANGERED SPECIES
                          ACT REFORM COALITION

        Mr. Yates. Chairman Sullivan, Ranking Member Whitehouse,
    members of the Subcommittee, my name is Ryan Yates. I currently
    serve as Chairman of the National Endangered Species Act Reform
    Coalition, also known as NESARC. I am pleased to provide
    testimony today on the Fish and Wildlife Service proposed
    revisions to its mitigation policy.
        NESARC is the country's oldest broad-based national
    coalition dedicated solely to achieving improvements to the
    Endangered Species Act and its implementation. NESARC's members
    represent a broad section of the American economy, which
    include agriculture, energy, real estate, forestry, water
    development, local governments, and other important industries.
    NESARC and its members are committed to promoting effective and
    balanced legislative and administrative improvements to the
    ESA.
        The business concerns and activities of NESARC's members
    frequently require them to seek approval from Federal agencies
    for permitting and authorization decisions. Our members seek
    clear and consistent standards that are within the scope of the
    law and that will guide the implementation of mitigation for a
    particular permit or authorization.
        NESARC's primary concern with the proposed mitigation
    policy and the Administration's other recent policies
    addressing mitigation is that they exceed the scope of
    applicable statutory authority. While the Service proposed the
    mitigation policy in response to directives from the President
    and the Secretary of the Interior, these policies cannot
    supplant, expand, and allow deviations from the Service's
    existing authorities and responsibilities and obligations.
    These responsibilities and obligations are grants from Congress
    and cannot be created by executive action.
        The ESA establishes specific standards and requirements for
    the scope and nature of any avoidance, minimization, and
    mitigation measures that may be imposed by the Service.
    Further, the ESA requires specific analysis and evaluation of
    impacts to listed species and designated critical habitat. The
    mitigation policy would impermissibly expand the scope of the
    ESA to rely upon landscape scale approaches, net conservation
    gains, and evaluation of species in a manner that is
    inconsistent with the requirements of ESA section 7 and section
    10. These statutory requirements cannot be overridden or
    undermined by the application of a general agency policy.
        The central goal of the mitigation policy is to effectuate
    a net conservation gain, or at minimum no net loss in the
    status of affected resources. Under the ESA, there is no
    mandatory obligation to improve or maintain the current status
    of affected resources. On the contrary, the statute provides
    specific standards in section 7 and section 10 regarding what
    may be required of a project proponent or a permit applicant.
        For example, the ESA section 7 requirements to avoid
    jeopardy or adverse modification and to minimize the impact of
    any take of listed species do not equate to the net
    conservation gain or no net loss standard articulated in the
    mitigation policy. There is no statutory authority to impose
    such requirements in the section 7 consultation context.
        A further problem posed by the Service's approach is that
    the term ``conservation gain'' is not easily defined and will
    likely evade consistent application in practice. Further
    complicating matters, if the Service uses this standard to
    require mitigation that is not commensurate with impacts to
    species or habitat the agency's application of a net
    conservation gain requirement could result in a regulatory
    taking.
        Last, the Service's landscape scale approach is overly
    expansive and fails to consider the role of States and local
    jurisdictions in species conservation. The Service cannot
    incorporate landscape scale mitigation into permitting
    decisions or authorizations without explicit statutory
    authority which requires such a broad ecological approach. For
    example, the Service cannot convert its limited scope of
    authority under section 7 and section 10, which focus on the
    impact of take of the species in a particular area, to an
    authorization to expand the minimization component to a
    landscape scale.
        Further, the agency's new definition of landscape and its
    reliance on a landscape scale approach are not conducive to
    consistent application and would undermine the role of States
    and other local jurisdictions in the management of species and
    habitat.
        While NESARC recognizes that mitigation is a tool which can
    be required in the application and approval of certain Federal
    permits, the proposed mitigation policy is overly broad, lacks
    the requisite statutory authority for implementation. Unless
    revised and clarified, the mitigation policy will introduce
    uncertainty into project planning, impose significant
    additional costs, and delay or prevent the issuance of
    necessary permits and authorizations, and ultimately reduce
    incentives for participation in efforts that would conserve
    species and their habitat.
        Senator, thank you again or the opportunity to testify. I
    am happy to answer any questions you may have.
        [The prepared statement of Mr. Yates follows:]

       [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Sullivan. Great. Thank you very much, Mr. Yates.
        Professor Colburn.

      STATEMENT OF JAMISON COLBURN, PROFESSOR OF LAW, PENN STATE
                               UNIVERSITY

        Mr. Colburn. I would like to thank Chairman Sullivan and
    Ranking Member Whitehouse, as well as the rest of the
    Committee, for the opportunity to testify today. It is an honor
    and a privilege to be here with you.
        My name is Jamie Colburn. I am a Professor of Law at Penn
    State. For the last 15 years I have conducted research on
    policies like this one and their importance and significance in
    our legal system.
        Before I left practice I went into teaching full-time. I
    spent 2 years as assistant regional counsel for U.S. EPA, and I
    am here today to talk about the breadth of this policy and the
    challenge created by the many different statutory authorities
    the Fish and Wildlife Service has to discharge.
        I want to highlight a couple general points before I delve
    into specifics.
        First, I think it is important to point out that this is
    guidance to subordinate agency personnel; it is not binding on
    anybody outside of the agency. Certainly not binding on the
    Federal courts, and it is immediately repealable by executive
    action if a subsequent Presidential administration would choose
    to do so.
        I think in citing 11 different Federal statutes at the
    outset of the policy proposal, the agency tipped its hand, so
    to speak, about the scope of its challenge. The Fish and
    Wildlife Service is often called upon to enforce a very
    specific statutory standard, which is the case with Endangered
    Species Act section 10, maximum extent practicable
    determinations, but they are also called upon in many contexts
    to offer recommendations that really don't have any force or
    effect at all; they are just the recommendation of an expert
    agency.
        And in the 15 years that I have been working on Endangered
    Species Act NEPA issues I have seen the scope of this practice
    of mitigation expand to an extreme degree, and it is my belief
    that what the agency was trying to do in offering a policy to
    its subordinates is to bring some coherent predictability and
    some transparency to mitigation at a broader scale. And if I
    may, I would just like to focus on a couple of specifics both
    from the Endangered Species Act and the NEPA context.
        When the agency is offering a specific interpretation of a
    statutory standard, as, for example, with the Endangered
    Species Act, it is often in everybody's best interest,
    certainly with something as complicated as mitigation for
    purposes of a habitat conservation plan, that agency personnel
    know all of the factors that they have to balance and only the
    factors that they have to balance. And I say that it is in
    everybody's best interest because of how litigious many of
    these issues have become.
        If agency personnel have to reinvent the wheel every time
    they make a necessarily discretionary judgment like this, it is
    going to compound the delay; it is going to reduce the
    transparency of those determinations to permittees in
    particular. And that is just the case with respect to HCP and
    other determinations that the Service has to make. This
    compounds itself through section 7 consultations as well.
        A policy of this kind, though, which treats mitigation in
    full, isn't just aiming at the Fish and Wildlife Service's
    specific duties to interpret statutory standards and enforce
    them against individual parties; it also encompasses more
    passive actions that the Fish and Wildlife Service takes as a
    recommender of good practices. And that brings me to what
    mitigation means in the NEPA context.
        NEPA section 102(2)(C) specifically requires action
    agencies that are preparing its detailed statements to seek the
    input--really the expertise--of any agency with Federal
    jurisdiction involved with the action, that might be germane to
    the action; and Fish and Wildlife Service, having the broad
    remit that it does, almost more often than any other agency
    finds itself called upon to offer its recommendations with
    regard to fish, wildlife, and plant resources.
        And in that context this is an entirely passive act by the
    Fish and Wildlife Service. They don't have any regulatory
    authority at all; what they are attempting to do is offer an
    expert opinion. But it has a lot of consequences for the action
    agency and oftentimes for the permittee behind that action
    agency if the Fish and Wildlife Service doesn't understand the
    scope, the Fish and Wildlife Service personnel involved in that
    case don't understand the scope of what mitigation should or
    ought to entail according to broader agency priorities.
        And as I lay out in my written testimony, this is a
    threshold problem both for whether or not to prepare a detailed
    statement under section 102(2)(C) of NEPA, but it is also a
    problem that arises a little bit further down the road when
    agencies are preparing what are known as Findings Of No
    Significant Impact, or FONSIs--environmental lawyers love
    acronyms--and the FONSI itself is predicated on the permittee
    or the action agency taking some kind of mitigating action.
        These mitigated FONSIs have grown in prevalence, and they
    have also grown in importance, which means that they often wind
    up in Federal court. They often become the subject of Federal
    court scrutiny. A policy of this kind, which communicates to
    other action agencies like the Corps of Engineers, as the
    Chairman was referencing, and their permittees what the Fish
    and Wildlife Service's priorities will be when it comes to a
    mitigation opinion under a section 102(2)(C) detailed statement
    or a mitigation opinion in the mitigated FONSI context I think
    would have the potential actually to speed permitting processes
    along. And I think that is why you see Federal courts
    encouraging agencies to maintain policies like this.
        In my view you have gotten clear signals from our Supreme
    Court last year, in the Perez case, and from the D.C. Circuit
    in a variety of cases, where they want to interpret the
    Administrative Procedure Act really to encourage these kinds of
    policies in order to increase the transparency and in order to
    ensure that subordinate agency personnel are responding to
    broader priorities that the agency has and that the
    Administration has, and that everybody knows how they will be
    doing so ahead of time. I think that is something that you can
    find from a number of lower Federal court opinions as well as
    from the Supreme Court.
        I see my time is about up, and I welcome any questions you
    may have. Thank you again.
        [The prepared statement of Mr. Colburn follows:]

        [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        Senator Sullivan. Great.
        Well, I again want to thank the panelists. You guys
    obviously are very knowledgeable on these issues, and you have
    thought about them, studied them in practice, been involved
    with them, so I appreciate you coming here and helping
    enlighten us.
        Let me just kind of start with the basics.
        We would all agree, and I will just ask each of you, that a
    permitting delay, and in Alaska, where it is notorious, for
    years and years and years of delays for important economic
    projects, but it is also throughout the country, would each of
    you agree that that is not in the national interest, nor is it
    what the statutes envisioned when they were passed, whether it
    was Endangered Species or any other provision?
        Would you agree, Mr. Kindred?
        Mr. Kindred. I would agree. And it is difficult, and I
    don't know if it is just the cynic in me, to imagine a scenario
    where adding another layer of policies is not going to result--
    --
        Senator Sullivan. Well, I am going to get to that.
        Mr. Yates, would you agree? The statutes weren't designed
    for 8-year delays on a project, correct?
        Mr. Yates. Senator, I agree.
        Senator Sullivan. Professor Colburn.
        Mr. Colburn. Absolutely, Mr. Chair.
        Senator Sullivan. So let me ask, and I am going to get to
    the issue. You guys were very, all three of you very articulate
    on the existing authorities, which, again, I believe are very
    dubious, and I know at least two of the witnesses also believe
    that. But we had Mr. Bean here essentially saying, hey, don't
    worry, this is not an additional level of bureaucracy; this is
    not going to delay. Do you even remotely think that that is
    going to be the case? I am not saying he was being deceitful,
    but is there any conceivable way that a new issuance of this
    kind of guidance is going to make more efficient and timely the
    permitting decisions by the Federal agencies?
        Mr. Kindred.
        Mr. Kindred. I don't see how it could. I mean, just
    realistically.
        Senator Sullivan. Can you give just your experience and
    examples?
        Mr. Kindred. Well, Alaska is unique in the sense that, and
    Mr. Bean referenced this idea; well, the Corps works well
    because they have these mitigation banks that afford the
    opportunity to put some this up front. There are no mitigation
    banks currently in Alaska. The fact of the matter is that right
    now there is a great deal of uncertainty just to get Corps-
    approved mitigation permits. So I find it highly unlikely--
    given how much of Alaska land is wetlands and critical
    habitat--how adding this additional layer won't just result in
    greater delays and greater uncertainty.
        Senator Sullivan. Mr. Yates, do you see this as Mr. Bean
    testified, that this is not an additional layer of bureaucracy;
    that this is going to speed things up; it is not going to
    delay? In your experience, do you think he is correct?
        Mr. Yates. I would have to disagree. In my experience, I
    have yet to find a scenario where additional layers of
    bureaucracy and requirements from a Federal action agency have
    increased the efficiency and reduced time and delays and costs
    related to a project being permitted and authorized.
        Senator Sullivan. How about this issue of the Corps of
    Engineers, which obviously works very closely with Fish and
    Wildlife, coming out and essentially saying this is going to
    tax you guys too much; you are already overburdened? I mean,
    the sister agency is coming out and saying that this is going
    to delay projects.
        Have you ever seen that before? To me, that is relatively
    remarkable that the Corps is essentially saying you don't need
    this, and it is going to delay things. The Corps of Engineers.
    This is not a Senator; this is a fellow agency. Have you ever
    seen anything like that in your practice, Mr. Yates, where the
    Corps has come out and said don't do it, it is a bad idea; or
    Mr. Kindred?
        Mr. Yates. I think it is very telling when you have a
    sister agency or a land management agency criticize this type
    of a policy or rulemaking. I think their expertise and their
    thoughts should be weighed heavily by the authorizing committee
    here in Congress through this process of scrutinizing this type
    of Federal regulatory action.
        Senator Sullivan. Mr. Kindred.
        Mr. Kindred. I agree. And I think probably another aspect
    of this is if I was working with the Corps I would be concerned
    about increasing the likelihood of litigation.
        Senator Sullivan. Yes.
        Mr. Kindred. If you have the Corps coming to one conclusion
    on mitigation and a recommendation from the Fish and Wildlife
    Service that is adverse to that, how is that reconciled, and
    how does that result in greater litigation?
        Senator Sullivan. Professor Colburn, let me ask you. You
    had some very insightful testimony as well, and I appreciated
    that. Your two colleagues there on the panel were very dubious,
    as am I, about the legal authority that the Fish and Wildlife
    Service has with regard to promulgating this policy when it
    clearly seems to be expanding what is in the statutory
    provision. You mentioned that it is just guidance, but as you
    know guidance actually matters; it matters in litigation, it
    matters in what these Federal agencies are empowered to do. We
    have had examples, the CD5 case in Alaska that delayed a really
    important project for the State and the country by well over 3
    years where at the very end the Corps was going to approve a
    bridge permit. At the very end the Fish and Wildlife Service
    put a letter into the file, and it delayed it for 3 years.
        So Mr. Bean was very nice about saying, hey, I am just
    giving advice; they don't have to listen, but they have power,
    whether it is guidance, whether it is their objection letters
    that can delay projects for years. I have seen this.
        So can you talk to that a little bit? You ended your
    testimony with something that is really important. What can we
    do to make sure that we don't have Federal agencies that are
    delaying and delaying and delaying projects?
        In my experience, most Federal agencies don't want to
    delay. To be perfectly honest, some do. I think the Secretary
    of Interior and the rest of the leadership in the Department of
    Interior wanted to kill that Shell project off the coast of
    Alaska. That is why it took 7 years, $7 billion to get
    permission to drill one exploration well in 100 feet of water.
    Outrageous. They wanted to kill it. They were successful. But I
    don't think that is the case most of the time.
        What can we do, in your experience, and you have a lot, to
    help not cut corners, we all want to protect the environment,
    but not to have a 20-year permitting process for a mine in
    Alaska?
        Mr. Colburn. Mr. Chairman, I think that is the question
    here, and I think it is the question that the agency is trying
    to address; and it is obvious that opinions vary about how they
    did.
        Senator Sullivan. But do you think that the additional
    guidance is not going to add to the delay, like the two other
    witnesses?
        Mr. Colburn. I think I would answer your question by
    pointing out that the delays in the examples you cite from
    Alaska are meeting at a single location, but they are beginning
    from many different sources, and if I were a general purpose
    agency like the Corps of Engineers, which under section 404 of
    the Clean Water Act is empowered to just make the ultimate
    determination on a permit, along with EPA, the reason I would
    take Fish and Wildlife Service's opinions so seriously is
    because they have the biologists necessary to make the best
    call, thumbs up or thumbs down, on a lot of the trust
    resources. And if they ignore what the Fish and Wildlife
    Service says, they do at their peril because the Clean Water
    Act is, as you know, Mr. Chairman, is so good at empowering
    parties outside of the Government to sue in the event they
    disagree with any permitting decision by the Corps.
        So if we were to grease the skid, so to speak, at the early
    phases and take mitigation not so seriously, when it is
    actually a statutory factor that has to be considered and has
    to be weighed co-equal with the other factors, I think it would
    be speed that we are borrowing temporarily for a lot of these
    cases. It would ultimately contribute to legal uncertainty in
    one form or another.
        Now, the other thing that I just wanted to respond to very
    quickly, what could Congress do to fix this, I think one of the
    sources of delay within the Fish and Wildlife Service is the
    fact that they have so many responsibilities and so little
    personnel to discharge them. And I know you have a thousand
    people a day asking you for money, but it strikes me that, in
    my experience with complex permitting problems like the one you
    referenced, the overwhelming culprit is the fact that there
    just isn't personnel, and there just aren't resources needed to
    answer some of these really technical questions.
        Senator Sullivan. Great. Thank you; that is excellent
    testimony.
        Senator Whitehouse. So, in a nutshell, agency guidance is
    capable of speeding up the administrative process by making it
    clearer to the applicants and clearer to the participants what
    is expected from the get-go.
        Mr. Colburn. I agree, Senator Whitehouse. I think that
    especially for the Fish and Wildlife Service, an agency that is
    so often in the business of providing an expert opinion to
    another agency whose only process delays add to theirs,
    guidance of this kind, which is, after all, aimed only at
    subordinate Fish and Wildlife Service personnel, actually has a
    realistic chance of speeding things up.
        Senator Whitehouse. Mr. Kindred, to use a colloquial
    phrase, Alaska is kind of getting whomped by climate change,
    compared to more southern locations. Your concern about how
    climate change gets factored into the Fish and Wildlife
    policies is that there not be unwarranted reliance on
    predictive models and that there not be speculation, and that
    there should be a documented cause and effect relationship
    based on predictable, reliable data that connects the data that
    is out there to the problem before the agency. And your concern
    is that if that is not there, you risk making an error.
        Mr. Kindred. That is part of my concern, yes.
        Senator Whitehouse. Now, what is the default proposition
    for you?
        Mr. Kindred. I guess I would like a little more clarity in
    the question.
        Senator Whitehouse. Well, you may get it wrong if you look
    at climate change data and try to use that data to predict
    exactly what the influence is going to be over time.
        Mr. Kindred. Right.
        Senator Whitehouse. And that is your concern, that you may
    get it wrong. But if you ignore climate change data, then you
    know you are going to be wrong, right? So the problem that I
    have is if you are concerned that the climate change data isn't
    secure enough for the agency to make a decision on, to me, that
    leaves you with the default proposition that you just ignore
    climate change. And particularly for somebody coming from
    Alaska that seems like a really implausible thing to ask the
    U.S. Fish and Wildlife Service to do based on the science.
        So my question is what is the default proposition here?
    What should be the kind of baseline from which the Fish and
    Wildlife Service makes these decisions that involve plugging
    climate change data into their determination?
        Mr. Kindred. I think that may be an oversimplification of
    my position on this, and it is important to distinguish between
    what NMFS did in their listing of the bearded and ring seals,
    where they contradicted themselves and went from saying that
    century-long modeling wasn't reliable to it was with the polar
    bear. And the polar bear species, I think, is a great example
    of some of the flaws with Fish and Wildlife Service's approach.
    I don't think any reasonable person can disagree that although
    polar bears are currently healthy and abundant, it is difficult
    to look at climate change modeling, no matter how much weight
    you want to give it, and not come to the conclusion that sooner
    or later the species will be imperiled.
        But part of the problem with Fish and Wildlife Service's
    approach to this is they came out, and they, one, acknowledged,
    even in listing the polar bear species as endangered, they
    lacked any authority to do anything about the only threat to
    the species, which is climate change.
        More to my point, I guess my concern as an Alaskan is that
    Fish and Wildlife Service also acknowledges that there is
    nothing that is happening locally, whether it be industry or--
    --
        Senator Whitehouse. Isn't it appropriate for the Fish and
    Wildlife Service to take into account outside factors that are
    putting pressure on a particular species and evaluating what
    additional pressures it can take? I mean, that is a known that
    they should put into their calculus, which is, based on our
    information, there is going to be a real wipeout in the polar
    bear population coming up, and therefore the population that is
    likely to remain is what we have to work with, and that is the
    data that we--that doesn't seem to be unreasonable at all.
        Mr. Kindred. That is not unreasonable, but when you look at
    what the effect is, the way people are being asked to pay a
    price for climate change as it relates to polar bear species,
    our Alaskans, have very little to do about the climate change
    threat.
        Now, if the Fish and Wildlife Service would have come out
    and said, you know what, we look at States with high
    populations like California, and we are going to regulate them
    and make them pay the price because they are actually far more
    responsible for the threat on polar bears than Alaska, I may
    come to a----
        Senator Whitehouse. But back to the question of climate
    change, your recommendation to the Fish and Wildlife Service
    would be get the best data you can, make the most reliable
    determination you can, not throw up your hands and do something
    you know is wrong unless there is a level of certainty.
        Mr. Kindred. To be perfectly candid, my recommendation to
    the Fish and Wildlife Service as they were going through this
    process was to announce that we are going to impose no
    regulations on Alaska. Not because it is just advantageous to
    me as an Alaskan, but because it sends the message to people--
    --
        Senator Whitehouse. That would make Senator Sullivan so
    happy.
        Mr. Kindred. Well, no, but it sends the----
        Senator Whitehouse. I think we could end all these hearings
    if there could just be an Alaska exemption. He'd come home
    happy.
        Mr. Kindred. But from an environmental standpoint, I think
    it is more important to announce to the citizens of the United
    States that simply listing a species, knowing that you can't do
    anything to protect it, gives people the false sense that it is
    being protected. And that was my biggest problem. If they would
    have come out and said this is a problem for everybody, the
    citizens of the United States, the citizens of the world, and
    if they don't take action, then we are going to have problems
    with the polar bear species. But to give people the false sense
    of security and not have them acknowledge their culpability in
    it, to me, is wrong.
        Senator Whitehouse. Understood. But to put it simply, it is
    not your recommendation for the Fish and Wildlife Service to
    ignore climate change impacts.
        Mr. Kindred. It isn't.
        Senator Whitehouse. Thank you. My time is over.
        Senator Sullivan. Chairman Inhofe.
        Senator Inhofe. Well, thank you. I am sorry I had to leave.
    I was kind of hoping this wouldn't devolve into a climate
    committee, but I suspected it might.
        You know, you are oil and gas up in Alaska, right? And we
    are in my State of Oklahoma. And what I would like to get from
    you, Mr. Kindred, is how would the new policy impact my State
    insofar as oil and gas are considered? I have two other areas I
    will be asking about, too, but thoughts on that?
        Mr. Kindred. Well, I apologize in advance; I don't know how
    intelligently I can speak about how this will affect Oklahoma
    only given that we have so many unique issues that cause delays
    and increase costs and kill projects. I mean, I think to the
    extent that there are areas that are designated as critical
    habitat in Oklahoma, I think changing the policy and changing
    Fish and Wildlife Service's approach from effectively working
    and creating reasonable mitigation policies to this no net loss
    or net gain can only result in adverse impacts to industry.
        Now, there is a separate question, academically, if that is
    OK, but from just oil and gas's perspective, it is hard for me
    to believe that this is going to be anything but increased
    costs, increased delays, and increased uncertainty.
        Senator Inhofe. I agree with that.
        Mr. Yates, you are also involved with the Farm Bureau, is
    that correct?
        Mr. Yates. Yes, sir.
        Senator Inhofe. And do you know Buchanan in Oklahoma?
        Mr. Yates. Yes, sir.
        Senator Inhofe. He talks about the things that affect
    adversely that farmers are concerned about, Tom Buchanan, not
    just in the State of Oklahoma, but throughout America, that it
    is the overregulation of the EPA. Then they single out as No. 1
    within those regulations, WOTUS. That is the No. 1 concern that
    he has. And the second thing is some of the endangered species
    and what is happening there.
        Have you already addressed how this would affect farmers in
    terms of this new mitigation policy?
        Mr. Yates. No, but I will try to expand on that. I think
    generally speaking, from the ag sector's perspective, be it if
    we are talking from additional regulatory requirements coming
    from the EPA concern to WOTUS, again, I think we have had a
    consistent dialog with this Committee about our concerns about
    that. But I think generally speaking we are trying to evaluate
    what these regulatory changes mean for ag producers not just in
    Oklahoma, but across the country. Generally speaking farmers
    are concerned with mitigation requirements which have
    ultimately led to the elimination of all ag use on these
    mitigated lands, and I think that is the general concern from
    the ag sector, is the reduction in use of these private lands
    for agriculture.
        And while this is a problem for agriculture in general, I
    would say especially a problem that we are seeing impact new
    beginning and young farmers and ranchers that are trying to get
    started in the industry.
        Last, I think the concern about loss of ag infrastructure
    when mitigation takes land out of production is continuing to
    provide concern, the lack of certainty for producers. This is
    what we hear that is keeping people up at night.
        So, again, be it from the EPA, be it from proposals like
    the mitigation policy, these new requirements that are being
    created from these executive branch agencies are troubling, and
    I think in my testimony we have had a conversation about this
    already, but I think the scope in which the Fish and Wildlife
    Service mitigation policy expands the regulatory reach of that
    agency as it pertains to landscape level conservation, and
    these new broad authorities that are largely undefined in
    statute is troubling, and I think that is a role for you, Mr.
    Chairman, and this Committee.
        The Fish and Wildlife Service should have come to you. They
    should have said, we have a problem, we are seeking--we think
    that additional mitigation would be helpful for the agency to
    protect species. And if that is their position, they need to
    come up with a legislative proposal and work with Congress to
    make those changes and not go about it through executive fiat.
    I think that is the wrong approach, and we have a lot of
    concern with that.
        Senator Inhofe. Yes, we understand that. Also, my State has
    a lot of DOD activity there. We have, of course, highway
    projects; we have a lot of Corps activities.
        But what effect--any one of the three of you--would this
    have in terms of our Department of Defense facilities? We have
    five major ones in the State. Any comments, any thoughts about
    that? Are they mainly exempt from this? And what areas are they
    not? Are you conversant with that?
        Mr. Yates. Unfortunately, I would be happy to get back to
    you with that question.
        Senator Inhofe. OK. Thank you.
        Senator Sullivan. Well, thank you, Senator Inhofe.
        I am going to wrap up with just a few final questions.
    Again, I want to thank the panelists. You have been outstanding
    witnesses.
        Just so we are clear in terms of your testimony, Mr.
    Kindred, Mr. Yates, you don't think that the no net loss net
    benefit policy that has been promulgated in the President's
    2015 memo and in these new regs, that that has a statutory
    basis for them to do that, is that correct?
        Mr. Kindred. It does not.
        Senator Sullivan. So they are exceeding their authority
    quite clearly, in your view.
        Mr. Kindred. Yes, Senator.
        Senator Sullivan. And you agree with that, Mr. Yates?
        Mr. Yates. In our opinion, they have gone well beyond their
    authority.
        Senator Sullivan. And Professor Colburn, you disagree with
    that, or you didn't have an opinion on that?
        Mr. Colburn. I disagree, Mr. Chairman. I think that if you
    were looking for statutory authority, and because you are
    dealing with very broad statutory authorities, the programs
    that they implement and that this policy touches are very
    broad. I would look at the purposes sections of those statutes.
        Senator Sullivan. But you are not troubled that the 26
    statutes that they cite, there is nothing like that in the
    language they cite?
        Mr. Colburn. To be honest, Mr. Chairman, I think of NEPA
    section 101, where it talks about the authority and the
    continuing responsibility of all agencies of the Federal
    Government. I think of the Endangered Species Act section
    7(a)(1) that says utilize the secretary, utilize all of your
    authorities in pursuit of the purposes of the Act. I think that
    is where the no net loss impetus is coming from.
        Senator Sullivan. Just let me throw in a final question.
    Senator Cardin had mentioned the goals of transparent, more
    predictable and timeliness in terms of permitting. I agree with
    that. And Senator Whitehouse talked about the importance of
    coordinating better among Federal agencies.
        Do you think that this policy is going to advance those
    goals?
        Mr. Kindred.
        Mr. Kindred. I think it would represent the first time that
    a great deal was added to the regulatory rubric, and it
    resulted in more transparency and more efficiency. It will be
    the first time it has ever happened, in my experience.
        Senator Sullivan. So your answer is no?
        Mr. Kindred. No.
        Senator Sullivan. OK.
        Mr. Yates.
        Mr. Yates. I will keep it simple. No, sir.
        Senator Sullivan. OK.
        Professor Colburn.
        Mr. Colburn. I think the 1981 policy creates its own
    uncertainties, so my answer would be I think it has a realistic
    chance of improving clarity and transparency.
        Senator Sullivan. Well, thank you, gentlemen. Outstanding
    testimony. Very much appreciate you being here.
        This hearing is adjourned.
        [Whereupon, at 4:24 p.m. the Committee was adjourned.]

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