[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]


                    EXPEDITING ECONOMIC GROWTH: HOW 
 STREAMLINING FEDERAL PERMITTING CAN CUT RED TAPE FOR SMALL BUSINESSES

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

                                HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD
                           SEPTEMBER 6, 2017

                               __________

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            Small Business Committee Document Number 115-033
             Available via the GPO Website: www.govinfo.gov
                   
                   
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                   HOUSE COMMITTEE ON SMALL BUSINESS

                      STEVE CHABOT, Ohio, Chairman
                            STEVE KING, Iowa
                      BLAINE LUETKEMEYER, Missouri
                          DAVE BRAT, Virginia
             AUMUA AMATA COLEMAN RADEWAGEN, American Samoa
                        STEVE KNIGHT, California
                        TRENT KELLY, Mississippi
                             ROD BLUM, Iowa
                         JAMES COMER, Kentucky
                 JENNIFFER GONZALEZ-COLON, Puerto Rico
                          DON BACON, Nebraska
                    BRIAN FITZPATRICK, Pennsylvania
                         ROGER MARSHALL, Kansas
                      RALPH NORMAN, South Carolina
               NYDIA VELAZQUEZ, New York, Ranking Member
                       DWIGHT EVANS, Pennsylvania
                       STEPHANIE MURPHY, Florida
                        AL LAWSON, JR., Florida
                         YVETTE CLARK, New York
                          JUDY CHU, California
                       ALMA ADAMS, North Carolina
                      ADRIANO ESPAILLAT, New York
                        BRAD SCHNEIDER, Illinois
                                 VACANT

               Kevin Fitzpatrick, Majority Staff Director
      Jan Oliver, Majority Deputy Staff Director and Chief Counsel
                     Adam Minehardt, Staff Director
                            
                            
                            C O N T E N T S

                           OPENING STATEMENTS

                                                                   Page
Hon. Steve Chabot................................................     1
Hon. Nydia Velazquez.............................................     2

                               WITNESSES

Mr. Philip K. Howard, Senior Counsel, Covington & Burling LLP, 
  New York, NY, testifying on behalf of Common Good..............     5
Mr. Louis A. Griesemer, President, Springfield Underground, Inc., 
  Springfield, MO, testifying on behalf of the National Sand 
  Stone Gravel Association.......................................     7
Mr. Mark Hayden, General Manager, Missoula Electric Cooperative, 
  Missoula, MT...................................................     8
Ms. Margot Dorfman, CEO, U.S. Women's Chamber of Commerce, 
  Washington, DC.................................................    10

                                APPENDIX

Prepared Statements:
    Mr. Philip K. Howard, Senior Counsel, Covington & Burling 
      LLP, New York, NY, testifying on behalf of Common Good.....    24
    Mr. Louis A. Griesemer, President, Springfield Underground, 
      Inc., Springfield, MO, testifying on behalf of the National 
      Sand Stone Gravel Association..............................    31
    Mr. Mark Hayden, General Manager, Missoula Electric 
      Cooperative, Missoula, MT..................................    39
    Ms. Margot Dorfman, CEO, U.S. Women's Chamber of Commerce, 
      Washington, DC.............................................    43
Questions for the Record:
    None.
Answers for the Record:
    None.
Additional Material for the Record:
    Associated General Contractors of America....................    47

 
EXPEDITING ECONOMIC GROWTH: HOW STREAMLINING FEDERAL PERMITTING CAN CUT 
                     RED TAPE FOR SMALL BUSINESSES

                              ----------                              


                      WEDNESDAY, SEPTEMBER 6, 2017

                  House of Representatives,
               Committee on Small Business,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 11:00 a.m., in Room 
2360, Rayburn House Office Building, Hon. Steve Chabot 
[chairman of the Committee] presiding.
    Present: Representatives Chabot, Luetkemeyer, Brat, 
Radewagen, Kelly, Blum, Comer, Gonzalez-Colon, Bacon, 
Fitzpatrick, Marshall, Norman, Velazquez, Evans, Murphy, Adams, 
and Schneider.
    Chairman CHABOT. The Committee will come to order.
    First of all, on behalf of the Small Business Committee, I 
wanted to extend our heartfelt prayers and support to the 
communities ravaged by Hurricane Harvey. Unfortunately, the 
storm took dozens of lives. It also took people's businesses 
and possessions and homes. This Committee is committed to 
helping these Americans reclaim and rebuild their lives as 
quickly as possible. As part of this effort, the Committee has 
been working, and will continue to work, with Administrator 
Linda McMahon and the Small Business Administration to ensure 
that it is able to efficiently and effectively respond. SBA's 
Disaster Loan Program, which provides direct loans to business 
owners and homeowners is a key component of the recovery 
efforts in these communities. This Committee will continue to 
be engaged on this issue for the coming weeks and months to 
make sure that we are doing everything possible that we can to 
help our fellow Americans in their time of need.
    And I would also like to extend our heartfelt concern to 
both the ranking member as well as Ms. Gonzalez-Colon for 
Hurricane Irma, which is ready, in the very near future, I 
believe, to hit Puerto Rico as well. And I know they have a lot 
of family and friends and loved ones there. So it has been a 
rough period of time for our country, and particularly the 
communities that I just mentioned. So we wish you the best to 
all your loved ones. And the things that I mentioned about are 
this Committee's commitment to helping out the folks down in 
Texas and Louisiana also extend to our fellow citizens in 
Puerto Rico as well. So we will work with the staff of the 
ranking member and Ms. Gonzalez-Colon if they have suggestions 
or things that we can do to help there.
    We are also here today to examine how the Federal 
permitting process hurts small businesses, which obviously this 
Committee is very involved with since it is the Small Business 
Committee. As this Committee well knows, complying with 
regulations is one of the biggest challenges facing small 
businesses today. The time and cost to comply with the growing 
number of regulations stymies economic growth and stifles 
innovation.
    The Federal permitting process is a component of this vast 
regulatory state. Usually before a business can begin to open 
its doors, launch a project, or begin an initiative, it must 
obtain a number of permits before moving forward. But the 
current permitting process is a maze that businesses big and 
small must navigate. And as with regulations generally, the 
Federal permitting process disproportionately affects small 
businesses. To obtain all the proper permits, small businesses 
must often deal with several agencies and departments with 
overlapping regulatory jurisdictions and endure lengthy delays 
waiting for permitting decisions, and cope with increasing 
costs to comply with these Federal permitting requirements.
    Our witnesses today will provide real examples of what it 
is like to attempt to comply with our complex Federal 
permitting process: having to constantly check boxes to move 
forward with a project; having to fill out difficult permitting 
applications only to wait for months, sometimes years, for 
agencies to make decisions; having to do the nearly impossible 
to meet all the permitting requirements while keeping their 
doors open.
    The current administration has taken positive steps to 
address the Federal permitting process, including two executive 
orders and a presidential memorandum. These actions acknowledge 
the burden the Federal permitting process imposes on the 
economy. That is a good start, but we must continue to look for 
ways to simplify and streamline the permitting process, 
especially to ease the regulatory burden on small businesses, 
our economy's lifeblood.
    That is why I introduced H.R. 33, the Small Business 
Regulatory Flexibility Improvements Act of 2017, at the 
beginning of this year. This bill ensures that Federal agencies 
actually examine the impact of new regulations on small 
businesses and consider ways to reduce unnecessary costs and 
burdens. The Small Business Regulatory Flexibility Improvements 
Act was included in a larger bill, H.R. 5, the Regulatory 
Accountability Act of 2017, which passed the House with a 
bipartisan vote back in January. The Senate has introduced a 
similar bill, S. 584, and we are waiting for them to take this 
important legislation up hopefully soon. If passed, the Small 
Business Regulatory Flexibility Improvements Act will be 
another step towards easing the regulatory burden on small 
businesses.
    I want to thank the witnesses here today. We appreciate you 
taking the time out to travel to Washington, D.C. to testify 
about your experiences, and we look forward to your testimony.
    And I would now like to recognize the ranking member, Ms. 
Velazquez, for her opening statement.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman. And I just want to 
echo your moving words. If there is a time when the federal 
government must play a role it is when natural disasters 
strike. And I pray for those victims in Texas, and Oregon with 
the fires, and now the Caribbean. And we do not know if 
Hurricane Irma will--well, the estimate, it is putting that 
storm, that hurricane, in a path to hit the South in the United 
States.
    This Committee has worked diligently throughout the years 
to revamp the disaster relief program and to provide the tools 
to the Small Business Administration to be able to assist those 
homeowners, businesses, and victims of any natural disaster. 
But I really am very grateful for your words and we pray that 
nothing happens; that there is no loss of lives. This is very 
personal for me and it should be very personal for everyone. 
Sometimes we forget that the people of Puerto Rico are American 
citizens and they show up to fight and defend our country. So 
thank you so much.
    Mr. Chairman, like raising revenue and funding various 
programs, regulation is a fundamental tool the Government uses 
to implement public policy. The costs and benefits associated 
with federal regulations has been a subject of great 
controversy with the costs estimated in the hundreds of 
billions of dollars and the benefits even higher. An inherent 
part of the regulatory process is permitting, in which a 
business must obtain approval from the federal government for a 
project. While federal permits are critical to ensuring public 
safety, they can also represent a costly and complicated hurdle 
for small businesses. Unchecked, regulations can over time 
become out of date, requiring companies to devote significant 
resources to compliance.
    This can be especially problematic for small companies that 
lack in-house lawyers and economies of scale enjoyed by larger 
competitors.
    It is reasons like this that prompted Congress to enact the 
Paperwork Reduction Act and the Regulatory Flexibility Act 
which help ease and minimize small firms' compliance costs. 
Despite the drawbacks, we should remember that permitting 
requirements also advance important public goals, helping 
ensure worker safety and protecting our air and water from 
pollution. I think we can all agree that certain processes 
should require a permitting process. For example, it seems like 
basic common sense that a permit for the disposal of nuclear 
waste is appropriate.
    Similarly, a careful review will find that some permits 
actually help small businesses and are critical to protecting 
local economies. For example, in accordance with the Clean 
Water Act, large boats are required to obtain a permit before 
operating in U.S. waters. This limits pollutants and toxic 
chemical compounds released into our waterways. This not only 
protects the public health, but also ensures product life 
remains plentiful and healthy for human consumption, keeping 
intact local job-creating fishing industries.
    Examples like this underscore why a ``one size fits all'' 
method for slashing regulation is inappropriate. Agencies 
should examine their use of permits on a case-by-case basis. In 
doing so, they can streamline and remove outdated regulations 
without compromising public health and safety or jeopardizing 
local environmental resources. One such method of analyzing the 
regulatory landscape was included in the FASA Act, which 
created a Federal Permitting Improvement Steering Council to 
streamline and expedite permitting requirements for 
infrastructure projects. Ensuring the FASA Act is fully 
implemented and the council fully functional could go a long 
way towards reducing permitting burdens. Unfortunately, 
President Trump has yet to nominate an executive director of 
the council.
    Improving compliance assistance can also go a long way 
toward leveling the playing field for small businesses. That is 
why it is so important that agencies are adequately staffed. 
Slashing budgets and imposing hiring freezes means agencies 
have fewer resources to help small companies navigate and 
comply with these processes. New technology can also play a 
role in reducing regulatory burden.
    It is my hope that today's discussion will shed light on 
how we can further reduce compliance costs for small companies 
without raising risks to the public health and the environment.
    With that, I once again thank the witnesses for being here 
and offering their insight, and I yield back the balance of my 
time. Thank you, Mr. Chairman.
    Chairman CHABOT. Thank you very much. The gentlelady yields 
back.
    And if Committee members have opening statements prepared, 
I would ask that they be submitted for the record.
    I would like to take just a moment to explain our timing 
lights for the witnesses. Pretty simple. We operate under the 
5-minute rule. You each get 5 minutes to testify and then we 
will have 5 minutes to ask questions. There is a lighting 
system to assist you. The green light will be on for 4 minutes, 
the yellow light will be on for 1 minute letting you know to 
wrap up, and the red light will come on and we hope that you 
are either finished or will wrap up shortly thereafter.
    And I would now like to introduce our very distinguished 
panel this morning.
    Our first witness will be Mr. Philip Howard, who is the 
founder of Common Good, a nonpartisan coalition focusing on 
simplifying the government. He has written many books and 
articles on legal and government reform, and he was appointed 
to President Trump's Strategic and Policy Forum in April of 
this year. He is also Senior Counsel at Covington and Burling 
in New York. Mr. Howard is testifying on behalf of Common Good, 
and we welcome you here today.
    Our second witness is Mr. Louis Griesemer. Mr. Griesemer is 
the President and CEO of Springfield Underground located in 
Springfield, Missouri.
    I am pronouncing the name right, aren't I? Okay, thank you.
    Springfield Underground supplies construction aggregates 
and provides underground storage for warehousing, laboratories, 
food storage, record storage, and data centers. Mr. Griesemer 
is testifying on behalf of National Stone, Sand, and Gravel 
Association, and we welcome you here today as well.
    Our third witness will be Mr. Mark Hayden, who is the 
General Manager of Missoula Electric Cooperative in Missoula, 
Montana. The Missoula Electric Cooperative provides electric 
distribution services to nearly 15,000 locations in Western 
Montana and Eastern Idaho with many miles of its distribution 
lines crossing over Federal lands. And we welcome you here 
today as well.
    And I would now like to recognize the ranking member to 
introduce our fourth witness.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman.
    It is my pleasure to introduce Ms. Margot Dorfman. Ms. 
Dorfman is the founder and CEO of the U.S. Women's Chamber of 
Commerce. The chamber represents 500,000 members, three-
quarters of whom are small business owners and federal 
contractors. Through her leadership, this organization has 
championed opportunities to increase women-business careers and 
leadership advancement. Additionally, Ms. Dorfman has an 
extensive background in business, including over 10 years in 
executive positions with General Mills and other Fortune 500 
firms. Welcome. Thank you.
    Chairman CHABOT. Thank you very much. And I would just let 
our witnesses know and also remind members that we are going to 
have votes probably starting around 10 minutes till noon 
approximately, but we are not absolutely sure. So we could 
finish up, but may have to come back.
    Mr. Howard, you are recognized for 5 minutes.

  STATEMENTS OF PHILIP K. HOWARD, SENIOR COUNSEL, COVINGTON & 
    BURLING LLP; LOUIS A. GRIESEMER, PRESIDENT, SPRINGFIELD 
   UNDERGROUND, INC.; MARK HAYDEN, GENERAL MANAGER, MISSOULA 
ELECTRIC COOPERATIVE; MARGOT DORFMAN, CEO, U.S. WOMEN'S CHAMBER 
                          OF COMMERCE

                 STATEMENT OF PHILIP K. HOWARD

    Mr. HOWARD. Thank you. Good morning, Mr. Chairman, members. 
Thank you very much for this opportunity to appear here.
    The focus of today's hearing, streamlining permitting for 
small businesses, is of vital importance to this country for a 
number of reasons. Small business is the heart of the American 
economy, represents half the GDP. It is also the wetlands that 
spawns the other half. Not many years ago, Amazon and Google 
were small businesses. All the businesses that make this 
country grow started as small businesses.
    Small business is also the soul of the American economy. 
What makes America so different than other countries is the 
ability of anyone to go out and be entrepreneurial and follow 
their star and make their own way by starting a business.
    Regulation is critical, good regulation, as the ranking 
member and the chairman both indicated. So the solution here in 
my judgment is not deregulation; it is making regulation 
practical for small business.
    What has happened without anybody really intending it is 
over the last 50 years, the permitting and regulatory structure 
for small business has slowly started suffocating the goose 
that lays the golden egg that everyone describes here. At this 
point, according to the World Bank, the United States ranks 
51st in the world in ease of starting a business. As the 
chairman indicated, it is much more expensive for a small 
business to comply with regulation than it is for big business, 
on average about 36 percent more per worker.
    Regulation is also extraordinarily unfair because the 
inability to comply, even to understand, but to comply with 
regulation means that small businesses that try hard to comply 
are at a competitive disadvantage to small businesses that 
realize that they can often just get away with ignoring 
regulation all together. So you have this vast disparity that 
is the opposite of what the rule of law is supposed to promote.
    I think there are three flaws in our general approach to 
regulating small business. First, it is too dense for real 
people to understand, much less to comply with: literally 
hundreds of millions of words of law, about 150 million words 
of binding Federal law and regulation, probably over a billion 
of State and local regulation. It gets denser every year 
because rarely the legislature or regulators take away the 
rules. It is like the roach motel. The regulations check in and 
they never check out.
    The reason it is so dense is not because that is necessary 
to protect a safe workplace or clean water; it is because we 
try to tell people exactly how to comply. We do not tell them 
what the goals are and give them principles and provide 
oversight mechanisms. Worker safety, for example, we literally 
have thousands of rules telling people helpful things like 
stairwell shall be lit by artificial or natural light. How else 
can they be lit? They require material safety data sheets for 
sawdust and sand and common dishwashing liquid, and give 
tickets if you do not have them in the appropriate place. These 
things have almost nothing to do with what makes the workplace 
safe.
    The third problem with regulating small business is the 
government does not even try to coordinate among the different 
agencies regulating small business. Federal Government agencies 
do not coordinate among themselves and much less coordinate 
with the State and local governments. So what happens is if you 
are trying to start a business in New York, for example, start 
a restaurant, Mayor Bloomberg found required permits from 11 
different agencies. In D.C., you want an extra apartment, you 
want to rent it out? Five permits. I have done studies of 
infrastructure permitting, and one project with almost no 
environmental impact, to raise the roadway of the Bayonne 
Bridge, 47 permits from 19 different agencies. It is impossible 
for a small business to navigate that labyrinth.
    The solution is not deregulation, but to create a practical 
method. Small businesses should also keep water clean. They 
should also have safe workplaces. What that requires I think is 
not just stemming the flow, which I agree with the chairman 
needs to be done, but we need a new approach. We need a new 
approach in general, replacing micro regulation with broader 
goals. And to get there I think that the first step would be to 
appoint an independent commission to do a study on the 
cumulative burdens, State and local as well as Federal, and 
recommend pilot projects where you have simplified regulation, 
where you have simplified enforcement using outside bodies like 
CPAs, except make them certified regulatory agents, to create a 
safe harbor and help people to comply because you cannot expect 
some small businessman to figure out exactly what all these 
rules require. So we should somehow institutionalize a 
mechanism, the goal of which is make it practical for small 
business to comply with legitimate public goals. And it would 
initiate such energy in our society if people could be 
confident that they could actually go and understand the law 
and go out and follow their star and do what has made the 
American economy great for all these years. Thank you.
    Chairman CHABOT. Thank you, Mr. Howard. Thank you.
    Mr. Griesemer, you are recognized for 5 minutes.

                STATEMENT OF LOUIS A. GRIESEMER

    Mr. GRIESEMER. Chairman Chabot, Ranking Member Velazquez, 
and members of the Committee, thank you for inviting me to 
testify at this hearing on behalf of National Stone, Sand, and 
Gravel Association, NSSGA.
    NSSGA represents the 10,000 construction and aggregate 
operations across the United States, located in every State and 
nearly every congressional district. More than 70 percent of 
NSSGA members are small businesses like mine. It is an industry 
that directly employs over 100,000 people and indirectly 
supports an additional 487,000 jobs throughout the economy. 
Overall, NSSGA member companies represent more than 90 percent 
of the crushed stone and 70 percent of the sand and gravel 
produced and consumed annually in the United States.
    NSSGA's primary concern is a fully funded, robust highway 
trust fund. While nothing can take the place of these critical 
Federal funds, regulatory overreach can cause costly project 
delays so regulatory reform is of great importance to us.
    As a business, we extract natural material for processing 
into crushed, sized, and washed stone. Crushed stone, sand, and 
gravel typically make up over 80 percent of ready-mix concrete 
and over 90 percent of hot-mixed asphalt. Aggregates are used 
in nearly all construction and public works projects, including 
buildings, highways, bridges, and airports, as well as treating 
drinking water and cleaning air emissions from power plants. 
Some of the regulations we must follow to operate make sense, 
and others do not, particularly for small businesses.
    My family's business was started in 1946 by my father and 
uncle, who discovered limestone while digging a farm pond and 
recognized the need for road material in nearby Springfield, 
Missouri. Springfield Underground now employs 43 people, and in 
addition to supplying construction aggregates, we also utilize 
our former underground operations as cold storage for 
corporations such as Kraft-Heinz and Cargill. Like me, some of 
our employees are the second or third generation of their 
families to work at Springfield Underground. I have worked in 
the industry since 1977.
    I want to be clear that I am not against regulation, nor is 
NSSGA. In fact, as the co-chair of the Mine Safety Health 
Administration NSSGA Alliance, I have led cooperative 
discussions with MSHA to develop and disseminate education and 
training materials intended to boost workplace safety and 
health for over 10 years. We have found that we can accomplish 
more by working together rather than having just a command-and-
control relationship.
    However, in too many cases, agencies unnecessarily slow 
down projects, and Springfield Underground has experienced this 
firsthand. In one instance, we had approved plans from our city 
for an expansion of our tractor trailer parking lot. When a 
State road contractor needed a place to dispose of crushed 
pavement, we contracted with them to take the material as fill 
for this parking lot. We applied for a land disturbance permit 
that was held up first by U.S. Fish and Wildlife Service, but 
then by the State. Both required a study to determine if we 
were in a bat breeding area for an endangered species bat. The 
potential breeding area amounted to a dozen trees and some 
brush. The permit was delayed by 4 weeks until it was 
determined that our land was not in the bat breeding zone. 
Rather than creating a ripple effect by delaying the project, 
another contractor had to take some of the material.
    Another example, our air permit requires that we apply 
water to unpaved areas to control dust. The humidity in 
Missouri means that putting that much water down creates some 
sticky mess that clings to truck tires. This site is also close 
enough to an airport so the Federal Aviation Administration 
does not want us to impound water that might attract migratory 
birds that impact planes taking off and landing. One agency 
limits our availability of water, while another agency demands 
overuse of it.
    These are only a few examples of problems that small 
businesses like mine can face. We need Congress to step in and 
help us by pursuing meaningful regulatory reform that assists 
small businesses who only want to follow the rules and support 
our employees and our community. To lessen the regulatory 
burden, the Small Business Regulatory Flexibility Act should 
apply to proposed Fish and Wildlife Service rules and the Mine, 
Safety, and Health Administration rules, and Federal agencies 
should have to meet deadlines for permit approvals and to 
determine if a regulation applies to a site.
    I appreciate this opportunity to address how streamlining 
Federal permitting could help small businesses like mine. Thank 
you, Mr. Chairman. I will be happy to respond to any questions.
    Chairman CHABOT. Thank you very much.
    Mr. Hayden, you are recognized for 5 minutes.

                    STATEMENT OF MARK HAYDEN

    Mr. HAYDEN. Good morning, Chairman Chabot, Ranking Member 
Velazquez, and members of the Committee. My name is Mark Hayden 
and I am the general manager of Missoula Electric Cooperative, 
MEC, in Missoula, Montana.
    MEC, through its 41 dedicated employees, serves the 
electric distribution needs of approximately 15,000 meters in 
Western Montana and Eastern Idaho. Our 2,000 miles of 
distribution line deliver energy to some of the most wild and 
scenic locations in the country, nearly 3,000 miles of which 
cross Federal land. We are proud members of the National Rural 
Electric Cooperative Association, the Montana Electric 
Cooperatives' Association, and the Northwest Public Power 
Association.
    For me, the timing of this hearing could not be more 
appropriate. Western Montana is on fire. Lives have been lost, 
property destroyed, hundreds evacuated. And while the fires 
burning today were all lightning sparked, they are a stark 
reminder to me of the unnecessary risk that long delays in 
Federal approval of permit applications and inadequate fuel 
reduction programs can bring to my co-op, our infrastructure, 
and our members.
    At MEC, we are constantly working to improve system 
reliability and reduce the risk of power line-caused wildfires. 
And vegetation management on Federal lands is a critical 
component of our program. Our dealings in this regard have 
generally been very positive, but this is not the situation in 
all rights-of-way managed by the Forest Service. Other 
cooperative representatives have testified before Congress of 
inconsistent land management policies, long delays in approvals 
and review times, and unnecessary liability resulting from 
these delays.
    In short, Federal reforms are needed to cut red tape and 
make it easier for electric co-ops to manage vegetation on 
federally managed rights-of-way. For that reason, we commend 
the House for recently passing H.R. 1873, the Electricity 
Reliability and Forest Protection Act, that received strong 
bipartisan support. This legislation would give electric 
utilities more consistent procedures and streamline processes 
in order to better manage utility rights-of-way.
    Unfortunately, H.R. 1873 will do little to address my 
concerns regarding the delays in the application for major 
operation and maintenance activities, especially when the 
National Environmental Policy Act, NEPA, process is required to 
amend these special use permits.
    For example, MEC made the decision to request burial of 
approximately 6.1 miles of overhead line on Forest Service land 
to improve reliability and reduce the risk of fire, and an 
application was submitted in December of 2013. Initial 
estimates suggested a 6-month review process; however, 18 
months later, we were still awaiting approval. It was then that 
I was invited to provide testimony before the House Natural 
Resources Committee Subcommittee on Water, Power, and Oceans 
regarding these application delays. In preparation for that 
testimony, I placed one final call to the local Forest Service 
district ranger to express my concerns. The ranger told me that 
if I wanted to see things change I should take up my issue with 
Congress, at which point I told him I intended to do so the 
following week.
    Two days later, on the Saturday afternoon prior to the 
hearing, MEC received unofficial notice via email that we were 
authorized to begin construction. This project qualified for 
categorical exclusion, meaning neither an environmental 
assessment or environmental impact statement was required. I 
can only imagine the number of months or years project approval 
would have taken had those more in-depth investigations 
applied.
    Proper vegetation and fuels management on Federal land not 
only affect our utility operations, but also those of our 
customers. An executive at a family-owned lumber mill on our 
lines tells me he views the cumbersome and time-consuming 
process to fulfill NEPA requirements as the single most 
important barrier to implementing timely stewardship and 
restoration treatments on our national forests. Regulatory 
barriers to proper vegetation and fuels management threaten not 
only the operation of our utility and the livelihoods of our 
members, but also of those businesses we serve.
    Mr. Chairman, members of the Committee, for us the status 
quo is not an option. We need streamlined, expedited procedures 
that allow for timely implementation of projects to improve 
system reliability, reduce the risk of power line-caused 
wildfire, and protect the long-term health of our forests. Our 
small businesses and the overall economies of the communities 
we serve depend on it. The best way to accomplish that is to 
provide consistency, flexibility, and accountability in the 
Federal permitting and permit amendment processes, and we 
believe this can be accomplished without abrogating the intent 
of Federal regulations.
    I appreciate this Committee's work in examining how small 
businesses, such as Missoula Electric Cooperative, can benefit 
from regulatory reform and for holding this hearing today. 
Thank you for the honor of testifying before the Committee, and 
I will be pleased to answer any questions.
    Chairman CHABOT. Thank you. Thank you very much.
    Ms. Dorfman, you are recognized for 5 minutes.

                  STATEMENT OF MARGOT DORFMAN

    Ms. DORFMAN. Chairman Chabot, Ranking Member Velazquez, 
members of the House Small Business Committee, I thank you for 
the opportunity to speak today.
    Federal regulations are created to implement our laws 
typically for the purpose of protecting public health and 
safety, and increasing or approximating competition where 
markets are inadequate. Sometimes the reverse is true as large 
businesses seek to use our laws and regulations for the purpose 
of gaining market advantage while putting public health and 
safety and smaller business competition at risk. Hurricane 
Harvey has demonstrated the importance of human safety and how 
closely linked our safety is to appropriate, well-enforced 
regulations, and we have seen the importance of financial 
regulations and oversight as our economy nearly fell apart due 
to the lack of government oversight and accountability of our 
financial institutions. We have seen the value of the Consumer 
Financial Protection Bureau to small businesses seeking access 
to capital and watching out for predatory and discriminatory 
lending practices, and history has also shown us that the 
rising concentration and anti-competitive behavior of some 
large corporations has led to the decline in the amount of new 
businesses entering the market.
    The U.S. Women's Chamber of Commerce recognizes and 
supports positive and responsible streamlining of Federal 
permits as a way to expedite economic growth. However, our view 
is twofold. One, the primary driver of problematic permitting 
and regulatory processes is the poor manner in which the 
government enacts and manages regulatory creation and 
implementation including permitting. The annihilation of 
regulations which protect public health and safety and increase 
competition would only serve to put our lives and economy at 
risk.
    Two, for Congress to fuel greater small business 
inactivity, you need to listen to small business owners who 
will tell you to expedite economic growth through small 
business success, you must improve the function of government, 
remove economic uncertainty, drive down health insurance and 
healthcare costs, drive up consumer spending, and simplify our 
tax system. We agree that permitting and other regulatory 
hurdles could be greatly improved and streamlined. It should be 
much easier for small businesses to know what regulations 
impact their businesses and what permits are necessary. 
Completing required filings and permits should be made easier, 
cheaper, and be concluded more quickly. The National 
Environmental Policy Act, the FASA Act, and Title 41 created 
the Federal Permitting Improvement Steering Council, but the 
Council does not focus on the needs of small business. The 
Small Business Administration is not a member of this council 
and the FAS 41 2016 Annual Report to Congress does not mention 
any consideration of small business and their activities or 
concerns. This is one opportunity of many governmentwide to 
make small business inclusion part of the fabric of government.
    If we are to focus on regulations, permitting, 
streamlining, and assisting small businesses to compete, grow, 
and help fuel our economy, the U.S. Women's Chamber of Commerce 
recommends the following.
    One, give small business a seat at the table 
governmentwide. Fund the Small Business Administration and 
empower and compel SBA to serve as a real champion for small 
businesses, rather than an agency that has been systematically 
underfunded for years, and then hold SBA leadership accountable 
for producing results.
    Two, add small business assistance and fast-tracking of 
permits so as to lighten the financial burden and improve small 
business certainty and planning. Especially focus on fast-
tracking the construction or expansion of manufacturing 
facilities.
    Three, reduce the fees or remove the fees for small 
business permitting on projects.
    Four, foster small business-large business partnerships, 
which include the large business partner securing required 
permits and managing regulatory requirements.
    Five, President Trump's recent budget proposal would defund 
manufacturing extension partnership, which provides tremendous 
assistance to small manufacturers. Instead, funding should be 
increased and include strong assistance in permitting and other 
regulatory requirements.
    Six, champion a governmentwide initiative to require all 
regulations be presented in plain English. All permitting 
processes be modernized, streamlined, and transparently tracked 
for timelines. All regulations be reviewed periodically so as 
to ensure rules remain relevant and are carefully targeted to 
avoid unintended consequences.
    And seven, stop agency staff overreach as laws passed by 
Congress are either not implemented or altered through weak, 
regulatory implementation so as to render them useless.
    Additionally, the U.S. Women's Chamber of Commerce strongly 
encourages the House Small Business Committee to focus on what 
really counts for small businesses, a well-run government, 
removing economic uncertainty, driving down health insurance 
and healthcare costs, driving up consumer spending, and 
simplifying our tax system. Thank you.
    Chairman CHABOT. Thank you very much.
    And I will now recognize myself for 5 minutes.
    Mr. Howard, I will begin with you. As you have mentioned, 
small businesses face staffing and budget constraints that make 
it especially hard for them to cope with unexpected delays. 
What is the average amount of time it takes for an 
infrastructure project nowadays to obtain Federal permits and 
what are the costs associated with delays in permitting?
    Mr. HOWARD. Well, it depends on the nature of the project. 
Large projects take years, between often 5 to 10 years, which 
has the effect of more than doubling the cost to taxpayers of 
the infrastructure. Lengthy environmental review ironically 
turns out to be usually very harmful to the environment because 
it prolongs bottlenecks of, you know, polluting bottlenecks and 
antiquated power lines that waste electricity, you know, for 
example.
    And just some of the stories we just heard are an 
indication of a regulatory system that is not what Congress 
intended when it passed NEPA. The NEPA guidance said 
environmental reviews should--even for the most complex project 
should not be more than 300 pages long. You could not find one 
that is that short. Raising the Bayonne Bridge, 20,000 pages 
for a project with almost no environmental impact. So very, 
very painfully expensive.
    And by the way, there are a lot of small businesses who are 
subcontractors on the big projects. So they are delayed 5 
years, too, you know, the aggregate supplier and such.
    Chairman CHABOT. I have got limited time so let me move on.
    Mr. Griesemer, how do permitting and compliance costs 
affect your company's ability to bid on new projects?
    Mr. GRIESEMER. Well, compliance becomes a part of--almost 
all of our senior managers have some sort of compliance 
component to what they do. It is across the board, whether it 
is human resources, whether it is environmental, whether it is 
safety, it impacts everybody's job. And we are a small company 
that is devoted to compliance. That is our culture. We want to 
comply with all the regulations. The difficulty is these 
overlapping regulations, and sometimes not even knowing that a 
regulation is going to--there are new ones popping up all the 
time. The example I gave on the road project on the endangered 
bat was not a problem the last time we had a land disturbance 
permit, but the ripple effect is--this was a project that was 
trying to be accelerated. All the other agencies, governmental, 
regulatory agencies were getting out of the way and trying to 
make this happen as quickly as possible and you have got one 
agency that is just not on board with that.
    Chairman CHABOT. Okay. Thank you.
    Mr. Hayden, how does uncertainty in permitting and 
regulatory costs affect the prices that your customers would 
have to pay for electricity, for example?
    Mr. HAYDEN. Well, of course, you know, one cost that I 
cannot measure is this added risk, so I would start with that. 
You know, we are very concerned about the added risk of fire, 
wildfire caused by power lines down. And I mentioned that many 
times because that is foremost.
    But if we talk about material costs, scheduling of our 
people, it is hard to invest in a piece of equipment or 
materials for a job if we have an uncertainty whether the 
project is either going to get approved or be delayed for 
multiple years. So that is a direct cost to our members. Staff 
time spent working on these is incredible. It takes an 
inordinate amount of hours for our staff to deal with the back 
and forth that goes on when permitting. And then it is service 
reliability. If we cannot keep the lights on, that is a direct 
cost to our members. It is a direct cost to our company.
    Chairman CHABOT. Thank you very much.
    And finally, Ms. Dorfman, I am always amazed at the number 
of warnings I get when I buy something. You open it up, warned 
not to eat something, like I am going to have this desire that 
I have got to eat this thing, and probably it was some, you 
know, I assume a child probably ate something they were not 
supposed to and so a lawyer sued somebody and this is what we 
all have to put up with. Now, the child probably could not read 
the warning about not eating something on this, but 
nonetheless, I am just wondering, do you think we ever go to 
absurd lengths on these types of things, you know, protecting 
us from ourselves? Do we ever go overboard or do you think all 
these regulations are worthwhile?
    Ms. DORFMAN. As I mentioned, I do believe that we have to 
have some common sense to this. But the regulations have been 
put in place for public safety and, in some instances, to 
ensure that there is competitiveness. So I think it is not a 
chop everything off and you have to go in with a fine-toothed 
comb and really identify, or the tweezers, to make sure that 
what you are removing is common sense. And I do not think there 
is like a blanket statement for that.
    Chairman CHABOT. So we should be reasonable, use common 
sense in these things in general?
    Ms. DORFMAN. Yes.
    Chairman CHABOT. Thank you very much. I appreciate it. My 
time is expired. The ranking member is recognized for 5 
minutes.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman.
    So I know that we always say that regulations could hinder 
economic growth and it could impose a burden, an economic 
burden to small businesses compared to larger companies, and, 
therefore, putting them at a disadvantage. But the fact of the 
matter is that we here in Congress, we pass legislation, and as 
a result of the legislation that we pass and enact into law, 
regulations are called for by certain agencies to promulgate.
    So my question is why do you think it takes 10 years for an 
agency to promulgate regulation? Mr. Howard?
    Mr. HOWARD. Part of the problem is how we regulate. We 
changed the way we regulated after the 1960s to avoid bad 
judgment by officials. So we got this idea. There were never 
1,000-page rulebooks, you know, with the 1950s to 1960s. The 
Interstate Highway Act was passed. We built 40,000 roads in 
little over a decade. It would not take that long if we did not 
try to create manuals that contemplate every single 
eventuality. The 950-page Volcker Rule could be summarized in 
one paragraph, no unreasonable proprietary trading by banks. So 
it takes years for people to argue over the 1,000 pages.
    Ms. VELAZQUEZ. We've held hearings here (more than one) on 
the IRS, and we had a panel of small businesses, but we did not 
have the IRS participating in that hearing. And for the most 
part, everyone that was sitting at that table said the 
important role that the IRS plays and that it's important for 
them to have access to a live person, but they cannot. Well, 
the disinvestment that has taken place in terms of certain 
agencies that we vilify, such as EPA, OSHA, IRS, will have a 
direct impact on slowing down the process for these agencies to 
do their job. So they are understaffed. They do not have the 
kind of manpower they need in order to expedite the processes.
    So it is a very difficult balance. We need to strike a 
balance. Right? We need to apply common sense and to help--to 
get these agencies to do what is right, but then, on the other 
hand, we expect for them to do their job without the type of 
resources that are needed. Budget cuts have consequences and 
sometimes the people that are intended to be helped, we are not 
helping them.
    Mr. HOWARD. Can I just say one thing?
    Ms. VELAZQUEZ. Yes.
    Mr. HOWARD. We also took away their authority. The chairman 
of CEQ, the Council of Environmental Quality, does not have the 
authority to say, oh, you are just burying the power line and 
this is going to be better for fires? That is a categorical 
exclusion. Go for it. Instead, he had to wait 18 months while 
it sort of circulated through lots of employees. So creating 
clear lines of authority to make decisions solves many of the 
problems that have been described today.
    Ms. VELAZQUEZ. So when agencies publish a proposed rule, 
the Reg Flex Act requires agencies to describe and estimate the 
number of small entities to which the proposed rule applies. 
Agencies often underestimate the number of small businesses 
impacted by proposed regulation or simply say that data is 
unavailable. Is it your experience, and this question is for 
anyone on the panel, is it your experience that the burden is 
on small businesses to demonstrate that they will be affected? 
And what is the best way to change this so that small 
businesses do not have to sue federal agencies in order for 
their voice to be heard? Mr. Hayden?
    Mr. HAYDEN. You know, I do not know that the burden has 
been placed on us to defend that, but I would look to the 
Regulatory Flexibility Act to say, hey, these indirect costs, 
they need to be measured in addition to the direct costs. Small 
business needs a voice in the process of developing regulation, 
you know, through that whole regulatory process. They need to 
show math. They need to show their math on how we are not 
affected. I guess that is what I would add to that is that I 
think that would really move the ball in terms of our having a 
voice in how those regulations are developed.
    Chairman CHABOT. The gentlelady's time is expired.
    The gentleman from Missouri. Thank you.
    The gentleman from Missouri, Mr. Luetkemeyer, who is the 
vice chairman of this Committee, is recognized for 5 minutes.
    Mr. LUETKEMEYER. Thank you, Mr. Chairman. And welcome to my 
compatriot from Missouri here, Mr. Griesemer. Thank you for 
your attendance today.
    Let me start with you. I appreciate your story with regards 
to the--I think it is the Indiana long-eared black bat, I 
believe, is that what it is?
    Mr. GRIESEMER. There is also an Ozarks long-eared bat.
    Mr. LUETKEMEYER. Oh, okay. I know we have got a lot of 
them. I had a situation in my district where we were doing the 
same thing, had a community that had a project like this and we 
came to realize that there has never even been a sighting in 
our State of this bat, yet that may be hibernating in these 
trees, and as a result it caused problems.
    Could you elaborate just a little bit, talk about your 
experience and then the cost to comply and the cost of the 
delay that it cost you?
    Mr. GRIESEMER. Sure. On that particular example, it seemed 
to us a simple matter because there are apparently some maps 
that exist within U.S. Fish and Wildlife that show that we are 
not in a breeding zone. The issue was that they breed in the 
trees. We are an underground mining operation. I kind of 
consider that we are actually creating bat habitat, but that is 
not the issue in front of us. But it would have been a fairly 
simple matter it seems to me to just look at the map and say, 
no, you are not in the breeding zone it is pretty clear.
    What the expectation is, because of funding and staffing 
and so forth, is that the expectation is it takes 4 weeks for 
the review. And this was a U.S. 65 project; that is the main 
artery between Springfield and Branson, Missouri. That is a 
tourist destination, and this is our six-lane artery that was 
being shut down. So it was really an accelerated project.
    The Highway Department had incentives in place to make sure 
this project was done in time, and as a subcontractor, echoing 
what Mr. Howard said, we were just a cog in the wheel, but 
potentially a vital cog that could have delayed this project 
significantly.
    Mr. LUETKEMEYER. How many people do you have in your 
business that are dedicated just to working on compliance 
issues?
    Mr. GRIESEMER. As I said in my testimony, every one of our 
officers has some compliance component in their job 
description. Probably our engineering and environmental, we are 
a small company so they have multiple duties. Our engineering 
and compliance person that does most of our regulatory and 
environmental permits and safety permits, half of his time, 
probably 30 to 40 percent of the human resources time, is 
devoted to that. A good percentage of my time as CEO is 
devoted. We estimate a couple hundred thousand dollars' worth 
of labor costs, management costs per year just for our company, 
approximately 5 percent of our expenses a year are directly 
related to regulatory.
    Mr. LUETKEMEYER. Thank you.
    Mr. Hayden, you were talking with regards to the hoops you 
were having to jump through with regard to doing work on 
Federal land, is that right?
    Mr. HAYDEN. That is correct.
    Mr. LUETKEMEYER. Do you have to do--do you have to jump 
through more hoops on Federal land than you do if you put a 
utility line over private land?
    Mr. HAYDEN. We do. Yes.
    Mr. LUETKEMEYER. Really?
    Mr. HAYDEN. In terms of the NEPA permitting process would 
require. We can bury, you know, generally bury line on private 
land much more easily than Federal.
    Mr. LUETKEMEYER. So you can do the same thing you are doing 
on private land, yet on Federal land they make you jump through 
a whole bunch of extra hoops and costs?
    Mr. HAYDEN. Costs. Costs. Cost recovery agreements. Yes.
    Mr. LUETKEMEYER. How many people do you have in your 
company dedicated just to compliance, or percentage of people?
    Mr. HAYDEN. Oh, percentage would be, you know, I have an 
Engineering Department, who, we are a small company so I would 
say that, you know, 15 to 20 percent of our engineering 
managers' time would be devoted to that. But we outsource a lot 
of that. When it comes to doing our long-range planning, we 
outsource most of that environmental analysis work.
    Mr. LUETKEMEYER. Okay, thank you.
    Also, Mr. Hayden, I know you mentioned the Small Business 
Regulatory Flexibility Improvements Act. It is the chairman's 
bill that we have passed here in the House. It is sitting in 
the Senate. And much to my consternation, it passed out of the 
Senate the other day, but it did on a party line vote and one 
of the senators, which is from Missouri, voted against it, 
which is ridiculous because all we are trying to do is help the 
small businesses.
    Would you elaborate a little bit on the effect of that bill 
on your business, how it would improve your ability to do 
business?
    Mr. HAYDEN. Well, I think it is a broad effect on any 
regulation, not just our business, having that input, having a 
panel sit down. If you think about a classic example would be 
the Waters of the United States bill that has now been pulled 
back, but there was no input from small business on the effect 
that that was going to have an electric utility, like Missoula 
Electric Cooperative. Electric co-ops cover about, you know, 75 
percent of the Nation I think is the amount of landmass we 
cover. Think of the impact of that and we did not even have a 
seat at the table.
    Mr. LUETKEMEYER. I appreciate that comment. And my time is 
out here, but I want to make one comment here very quickly, 
because you made the comment in your testimony with regards to 
having a voice in the determination of the regulation. It is 
vitally important, I think, and you just made the point again, 
to be able to have small businesses at the table, people who 
are going to be directly affected by these regulations, to at 
least have an input or say in how these regulations are 
developed. So thank you so much for your story and your time 
today.
    Chairman CHABOT. The gentleman's time has expired.
    The gentleman from Pennsylvania, Mr. Evans, who is the 
ranking member of the Subcommittee on Economic Growth, Tax, and 
Capital Access, is recognized for 5 minutes.
    Mr. EVANS. Thank you, Mr. Chairman.
    Mr. Howard, I am going to probe a little bit on the part 
when you talk about a new approach. And you say, you talk about 
a new regulatory framework is needed, and the sense I get from 
you in saying that is people do not want the other extreme of 
total deregulation. That is kind of what you are saying. Now, I 
know we are dealing strictly with Federal jurisdiction here, 
but many businesses are worried about duplicate regulation, 
both at the Federal level and the State and the local levels. 
Can you discuss the extent to which firms face such duplicate 
permits?
    Mr. HOWARD. Well, I can give a few examples. The example 
that I studied and issued reports on the last couple of years 
has been infrastructure. And infrastructure projects typically 
go through multiple layers of review. The new power line to 
connect wind farms in Wyoming to the Pacific Northwest, for 
example, had to get permits from each county in Idaho over 
which the line was constructed, which delayed the project and 
added to the cost of it and potentially, although it rarely 
works out this way, could have been a veto.
    One of the reasons the United States has almost no private 
investment in infrastructure compared to Europe is because of 
what Mr. Griesemer was saying, which is the uncertainty of when 
the permit is going to be given. So nobody wants to invest 
private money if they do not know if they are getting an answer 
in a year or two. So that is one example that I happen to have 
studied with infrastructure, but almost every area of endeavor 
that is regulated has permits required on multiple levels of 
government.
    Mr. EVANS. And you sort of think, what I heard you say, and 
I do not want to put words in your mouth, you said something 
about having another commission. I heard you say you have 
another commission.
    Mr. HOWARD. Yeah, I am sorry. I did say that. Yes.
    Mr. EVANS. You did say, I mean, I thought I heard you say 
send another commission, so I am thinking in my head, educate 
me on what you think by setting up another commission would 
accomplish the objective. I am just----
    Mr. HOWARD. Well, personally, I think that small business 
should have a seat at the table.
    Mr. EVANS. Right.
    Mr. HOWARD. But I do not think it is possible to reconcile 
the regulatory objectives with a large oil and gas company, 
with the regulatory objectives of a company with 20 or 50 
employees. I think those require different regulatory regimes, 
not a ``one size fits all.''
    Mr. EVANS. Mm-hmm.
    Mr. HOWARD. And so I believe there should be pilot projects 
to test dramatically simplified approaches to meeting 
environmental goals and worker safety goals and other goals. I 
am not for getting rid of those goals, but applying those in a 
different way to small business because I do not think we can 
ever reconcile the need to regulate Shell Oil or BP in one way 
and regulate a small business in the same way. I just do not 
think those two things are compatible.
    Mr. EVANS. Okay.
    Ms. Dorfman, a poll conducted by the American Sustainable 
Business Council found that the lack of demand was the biggest 
problem facing small businesses. Given this outcome, should we 
be focusing our attention on ensuring small businesses have 
customers reforming the Tax Code? And which provisions?
    Chairman CHABOT. If you could turn the mic on there. Thank 
you.
    Ms. DORFMAN. Sorry. We find that the tax regulations are 
overly complex and they are weighted to the wealthy, but also 
to big business. And so we are not getting the same benefits as 
you were mentioning. You know, you cannot compare BP to a 50-
person company, the same thing. We are not receiving the same 
benefits so there are challenges there.
    And then additionally, where the money comes from is really 
looking at the consumer spending. And so we need the money into 
the pockets of the consumer to drive the consumer spending to 
grow small businesses.
    Mr. EVANS. Real quick. Do you have any suggestions and 
thoughts around that since tax reform is a discussion we are 
generally talking about?
    Ms. DORFMAN. We need to, when looking at that, ensure that 
the consumer, which is generally the nonwealthy, the non-1 
percent, has better tax benefits where they have more money 
coming in to them that they can go ahead and use that money as 
the extra money to spend on consumables.
    Mr. EVANS. Thank you, Mr. Chairman. I yield back the 
balance of my time.
    Chairman CHABOT. Thank you. The gentleman yields back.
    The gentlelady from American Samoa, Ms. Radewagen, who is 
the chairman of the Subcommittee on Health and Technology, you 
are recognized for 5 minutes.
    Mrs. RADEWAGEN. Talofa. Good morning.
    Thank you, Mr. Chairman and Ranking Member Velazquez, for 
holding this hearing. I also want to thank all of today's 
witnesses for appearing today. It is an important hearing. We 
have been working on this exact issue in the Natural Resources 
Committee on which I am also a member.
    It is important that we also examine how burdensome 
regulations harm America's small businesses. It is easy for 
multinational corporations to hire an army of lawyers to handle 
regulations. It is here where we need to advocate for small 
businesses.
    Mr. Howard, my question is for you. Regulatory overlap 
between agencies can cause confusion for businesses and 
complicates the permitting process. How do you think agencies 
should decide which agency is the lead agency with overriding 
authority when multiple agencies disagree?
    Mr. HOWARD. The Balkanization of authority within the 
Federal Government and among the different levels of government 
makes trying to get permits, and indeed, trying to comply with 
regulation, a form of chaos. It is anarchy. There are no clear 
lines of authority to resolve disagreements among different 
agencies. The laws are so dense that the President of the 
United States does not have the authority right now to resolve 
these disagreements.
    In every area of regulation there should be an overarching 
authority through the executive branch to resolve 
disagreements. The FAST Act set up a 16-agency steering council 
to resolve disagreements. I asked when they were doing it how 
long it would take to schedule the meeting and what happened if 
people did not agree. There is no clear line of authority up to 
the president to resolve that disagreement.
    Common Good has proposed three pages of amendments to the 
FAST Act, which among other things would give the chairman of 
the Council of Environmental Quality the authority to decide 
all issues about scope and adequacy of environmental review and 
would give the president, or whoever he designates, the 
authority to resolve those disagreements. Without that 
authority, what you get is bickering between Fish and Wildlife 
and the Corps of Engineers that can take years.
    Mrs. RADEWAGEN. Can you explain how a one-stop shop Federal 
permitting system would work? Are there similar systems that 
can be used as a model?
    Mr. HOWARD. The one-stop shop has applied very well in 
other countries. Germany, for example, designates one agency, 
whether it is a State or a Federal agency there depending on 
the project to give the permit. They still have to comply with 
law, but they have ultimate authority to make the decision. 
Germany, which is thought to be a greener country than the 
United States, issues permits and complex projects within 1 to 
2 years.
    A one-stop shop is simply allocating authority to an agency 
or to the White House and with whatever checks and balances 
Congress chooses to put in it, oversight by someone else, and 
everyone still has to comply with law, so there are judges and 
courts in the background. But today, the authority is even. 
Every agency is equal to every other agency. They are each 
complying with their own regulations. They each have their own 
goals. And that is why it takes months and years to get really 
obvious approvals often.
    Mrs. RADEWAGEN. Thank you, Mr. Chairman. I yield back.
    Chairman CHABOT. Thank you. The gentlelady yields back.
    The gentlelady from North Carolina, Ms. Adams, who is the 
ranking member of the Subcommittee on Investigations, 
Oversight, and Regulations, you are recognized for 5 minutes.
    Ms. ADAMS. Thank you, Mr. Chairman. And thank you to our 
Ranking Member Velazquez as well. And thank you all for your 
testimony. This question is to the entire panel.
    The National Federation of Independent Business does a 
regular survey of small businesses, but I find it particularly 
interesting that their server results show that complaints 
about regulations are relatively consistent through economic 
booms and conservative presidents that prioritized 
deregulation. For instance, the shared concern about regulation 
under President Obama was about 13.9 percent. It is not 
substantially higher than under George W. Bush, which was 9.9 
percent and 11.0 percent; or Ronald Reagan's second term, which 
was about 12.8. And one would think that regulatory concerns 
would have significantly decreased under Reagan and Bush since 
neither of those were known for being fans of big government.
    So my question to all of you is why are regulatory concerns 
consistently cited?
    Ms. DORFMAN. I believe that there are challenges with 
regulatory concerns. However, the issue is that because they 
are not being addressed, getting through the permitting or 
those sorts of things because there is not funding for the 
Federal agencies to make sure things are expedited, that those 
are what would create it. As you said, it was kind of 
inconsequential from one party to the other, but what I think 
the overarching is, is that there is always a lack of speed and 
expedited service.
    Ms. ADAMS. Okay.
    Mr. Hayden?
    Mr. HAYDEN. Congresswoman, I guess an example I would give 
is just a frontline practical example. Ranking Member Velazquez 
mentioned common sense. And in our example, we were trying to 
move a power line outside of the forest and bring it out to 
road right-of-way. In that first example I gave in my 
testimony, the area under analysis had already had a 
telecommunications line buried in that. So rather than doing 
this full-blown analysis, would it not make sense to be able to 
go to a file and look at the analysis that had been done 
previously?
    We have since submitted a second application and that 
application seeks to bury a power line in a highway road right-
of-way. That ground has been disturbed by bulldozers when the 
road was built, and it just does not make sense that this 
thorough analysis has been done.
    And I will give one final example. We got a bill for $8,000 
to do that first analysis in the example I gave. That indicated 
that 10 people had spent an average of 2.3 days on the project. 
So 18 months, 2.3 days, even if that was sequential, it should 
have been much shorter.
    Mr. HOWARD. Under each of the Republican presidents you 
mentioned, and I was involved in advising all of the last four 
presidents, including starting with Clinton and Gore in 
reinventing government, the basic approach was to prune the 
jungle. Let's go in and get rid of stupid rules. But what they 
did not do is create the authority mechanisms that allowed Mr. 
Hayden to call somebody up and say this ground has already been 
disturbed. It makes no sense whatsoever to wait a long time. 
Can I please have permission to bury this line? No one in the 
government thinks they have that authority.
    Ms. ADAMS. Okay.
    Mr. HOWARD. And so until you actually shift from a command 
and control, what do the rules require, to give somebody the 
job of actually asking what is common sense here and being 
transparent about it, you know, saying here is why we made the 
decision, American voters will increasingly be frustrated at 
Big Brother. They are not frustrated because we are protecting 
clean water or protecting the forest; they are frustrated 
because they cannot get an answer and it is taking them months 
to do something that ought to take a day.
    Ms. ADAMS. Okay. Mr. Griesemer, would you like to comment?
    Mr. GRIESEMER. Yeah, I would just echo that I have not, 
regardless of which administration we have been under, there 
has not really been a reduction that I am aware of of any other 
volume of regulations. The Code of Federal Regulations is just 
a massive thing, regardless of whether you are talking 
environmental, safety and health or what area. It seems to be 
almost immune from any kind of political influence as far as 
deregulation. They do cut some things and try to streamline, 
but we are not seeing the effect at the small business level.
    Ms. ADAMS. All right. Thank you. Thank you very much. I 
yield back.
    Chairman CHABOT. Thank you. The gentlelady yields back.
    Mr. Blum, before we get to you, the chair would like to 
make a suggestion. We have four more questioners and we are 
expecting votes at any minute. We are actually over now. Rather 
than have to come back or cutting off--there it is right now--I 
was going to suggest that we go to about 3 minutes each if that 
would be okay.
    Mr. Blum, you are recognized for 5 minutes. Thank you.
    Mr. BLUM. Thank you, Chairman. Thank you to the panelists 
for being here today.
    Mr. Howard, you said you were involved in the Clinton-Gore 
Reinvent Government effort, is that correct?
    Mr. HOWARD. Yes, sir.
    Mr. BLUM. Is this the government you all invented?
    Mr. HOWARD. No, it actually got invented before. They just 
did not quite succeed in reinventing it.
    Mr. BLUM. The Competitive Enterprise Institute estimates 
the cost to U.S. businesses for regulations is approach $2,000 
billion a year, $2 trillion a year, and most of that is not 
legislated. Most of that is developed by unelected, career 
bureaucrats without a vote being held in the United States 
Congress. Those bureaucrats report to not one voter. This is 
why I support adamantly the REINS Act which has passed the 
House of Representatives, but is stilled, like a lot of 
legislation, in the U.S. Senate.
    I would like to hear anyone from the panel, particularly 
Mr. Howard, on how do we solve this dilemma? I mean, these are 
unelected bureaucrats forcing trillions of dollars of cost onto 
United States businesses. What do we need to do as a Congress? 
I think the REINS Act is a great step in the right direction. I 
would love to hear your thoughts.
    Mr. HOWARD. First, you are correct. I agree completely that 
Congress should have ultimate responsibility for regulations 
that are just delegated lawmaking. So Congress should take 
responsibility for the success of regulations, as well as for 
statutes.
    Now, just to push back a little, I do not remember the last 
time Congress had hearings to go through the statutes that were 
passed that authorized a lot of these regulations to say should 
we clean up those statutes? So the REINS Act, it seems to me if 
you are going to take responsibility, it should be for the 
statutes as well as for the regulations.
    The President used to have authority over public employees. 
The Civil Service System--I have written extensively, I will 
talk to you about it offline--needs to be overhauled both to 
encourage better workers and to make people accountable when 
they do not have common sense, when they use bad judgment, when 
they are mean-spirited, and that would go a long way toward 
making the unaccountable regulators, if you will, at least 
somewhat accountable.
    Mr. BLUM. Thank you. I will yield back my time, Mr. 
Chairman.
    Chairman CHABOT. Thank you very much. The gentleman yields 
back.
    The gentleman from South Carolina, Mr. Norman, is 
recognized for 3 minutes.
    Mr. NORMAN. Thank you, Mr. Chairman. I will be brief 
because we have to go vote.
    But let me just say I have been on both sides. I am a 
developer. I have been held hostage by the one-eyed bat, by the 
Hilltop Wood Splitter. I have been in the political arena. Let 
me just suggest, when we tried to get these businesses to name 
the specifics of the rules that are costing them money that are 
redundant, they were scared to do it because their philosophy 
was it is going to get worse. I do not want it to take longer. 
So I would suggest to get involved more because you are 
talking, and I have seen from the political arena, you are 
talking either a lot of people, business people cannot get 
involved because you do not have the time, but you need to get 
your people, Mr. Griesemer, your NSSGA, to really get involved 
and get with us because I can tell you, the people coming to my 
office wanting more regulations on a State level and a national 
level far exceed the businesses that come to say stop it.
    But we do not know what we do not know. And see, you are 
talking to a lot of people who are not in the business arena. I 
am. So get active. Let people who are business minded. And if 
you do not--I have heard over and over, I do not have time. I 
do not have time. Well, it is costing you a lot of money as I 
have heard and it is redundant.
    So I put the burden back on you all to get active. To get 
from a local level on up to my level, get active. And a lot of 
times the chamber is not going to get involved because they are 
a lot of bureaucrats who are not interested in rocking the 
boat. It is time to rock the boat, and we have a president now 
who is willing to do that. I yield back.
    Chairman CHABOT. Thank you very much. The gentleman yields 
back.
    And the gentlelady from Puerto Rico--and I would, before 
recognizing her, I would just note that the chair early on 
expressed the Committee's sympathy and concern both for the 
ranking member and yourself for your constituents and family 
members who may be adversely impacted as we speak by Hurricane 
Irma. And the gentlelady is recognized for 3 minutes.
    Ms. GONZALEZ-COLON. I want to thank you, Chairman Chabot, 
for your willingness to cooperate with the situation, and the 
ranking member, for their concerns about the Hurricane Irma. It 
is the worst hurricane ever that is hitting the Caribbean, the 
U.S. Virgin Islands, and Puerto Rico. We are talking about 185 
miles per hour. So never before have we had this kind of 
impact.
    And this issue that we are discussing today and the votes 
that are taking place at the same time are issues that are very 
important for the island in terms of how to improve our 
economy.
    Because of the time I will make just two questions. One of 
them is that the President on January 24th released a 
memorandum titled ``Streaming, Permitting, and Reducing 
Regulatory Burdens for Domestic Manufacturing.'' In this 
memorandum the executive departments and agencies are directed 
to expedite reviews and approvals for construction and 
manufacturing facilities while also reducing regulatory burdens 
affecting domestic manufacturing. In that memo there is no 
specific reference to the territories or even Puerto Rico. Do 
you understand that the territories and Puerto Rico should be 
included in the definition of that kind of regulation? That is 
an open question for the panel.
    You need to say yes.
    Mr. GRIESEMER. Yes.
    Mr. HOWARD. Yes.
    Mr. HAYDEN. Yes.
    Ms. GONZALEZ-COLON. Thank you for voluntarily saying that.
    The second question will be regarding Mr. Howard. As you 
know, the National Environmental Policy Act requires that all 
major projects with Federal nexus to submit a comprehensive 
review of the potential environmental impacts. Currently, the 
Government Accountability Office reported that the 
administration did not know how much time it spent on 
environmental reviews, but they estimate that time in 4.6 years 
took place in terms of the span of completing the average 
environmental impact statement. In your opinion, how could that 
number be more efficiently worked if we got a one-stop Federal 
permitting system expediting the process?
    Mr. HOWARD. Without question, the missing link in 
shortening and focusing environmental review is that there is 
no official, no environmental official, who has the authority 
to make the judgment, what is important in this project. 
Recently, there was a tunnel to be built under the Hudson 
River, really important tunnel that needs to get built 
immediately because the two existing tubes were damaged by 
Super Storm Sandy and they can collapse at any moment and when 
they do, there is gridlock for the entire metro area of New 
York. They were being held up by environmental review for a 
tunnel. It did not matter how they built the tunnel. It would 
be better for the environment. But no one had the authority to 
say get moving. You need to have that authority somewhere.
    Ms. GONZALEZ-COLON. Thank you, Mr. Chairman. I yield back.
    Chairman CHABOT. Thank you very much. And the gentlelady 
yields back.
    We want to thank the panel very much. I am going to 
withhold my closing statement, which was profound and well 
written, et cetera, and thank you.
    You all have shed a lot of light on what we need to do to 
have a much better permitting process and how it adversely, 
especially, affects small businesses.
    I would ask unanimous consent that members have 5 
legislative days to submit statements and supporting materials 
for the record.
    Without objection, so ordered.
    And if there is no further business to come before the 
Committee, we are adjourned. Thank you very much. Got to go 
vote.
    [Whereupon, at 12:16 p.m., the Committee was adjourned.]
                            A P P E N D I X

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

    Chairman Chabot, Ranking Member Velazquez, and Members of 
the Committee:

    Thank you for inviting me to testify before the Committee 
today about streamlining federal permitting to reduce the 
regulatory burden on small businesses. Small businesses play an 
indispensable role in American culture and commerce but are 
burdened by the dense regulations that have built up over the 
past five decades. They do not have the time and resources to 
understand, much less comply with, the many requirements.

    Getting a permit to start a business, or to build anything, 
requires going to multiple agencies, often at federal, state, 
and local levels. These agencies rarely coordinate their 
requirements. Often their demands are duplicative, and 
sometimes conflict with one another. Nor do they honor the 
practical implications of the regulations--not the costs, time 
constraints, or diversion of energy.

    The regulatory burden on small business extends far beyond 
requirements to apply for specific permits: Regulatory 
compliance itself is a form of mandatory permitting because a 
small-business owner cannot do business without it.

    As I will discuss, Congress should advanced its interest in 
promoting small business by examining the permitting and 
regulatory burdens imposed by state and local law as well as 
federal law. A new regulatory framework is needed to meet 
public regulatory goals in a way that is practical for people 
running small businesses. Small businesses need a separate, 
simpler regulatory system, focused on meeting regulatory goals, 
not rote compliance with detailed specifications and 
prescriptions. Government should make permits and licenses 
accessible to real people with a ``one-stop shop.'' I propose 
principles to frame a regulatory overhaul and specific 
initiatives to set that overhaul in motion.

    Small Business is the Driver of American Prosperity

    Small businesses are critical, first, because they are the 
largest part of the U.S. economy. Companies that have fewer 
than 500 employees are collectively responsible for almost half 
of the total GDP and more than half of all sales in the United 
States.

    Small businesses are also the incubator of big businesses--
a kind of wetlands which spawns innovation. According to the 
Kauffman Foundation, the net increase in jobs since 1980 is 
entirely attributable to newly-started businesses.

    Small businesses also provide an open door by which 
Americans can achieve self-determination and ownership, which 
is important far beyond its economic consequences. America is 
the land of opportunity in large part because of its 
receptivity to individual initiative.

    But the pace of growth has slowed: 11 percent fewer 
businesses opened their doors in 2013 than in 1980. The 
disjointed regulatory framework is a powerful disincentive to 
entrepreneurship. According to 2017 World Bank rankings, the 
U.S. ranks 51st in the world in ease of starting a business. By 
many accounts, regulatory compliance costs are overwhelming for 
small businesses. The U.S. Small Business Administration found 
that companies with fewer than 20 employees faced regulatory 
costs per employee that were 36 percent greater than the cost 
for larger firms.

    Studies suggest that most of these costs are attributable 
to federal regulations: 58 percent of small-business owners 
responded in a 2017 survey that federal requirements are the 
most burdensome for their business. Nearly half of small 
businesses report spending more than $10,000 annually on 
federal companies, with 11 percent spending more than $40,000 
in total per year.

    The amount spent on compliance does not include the 
diversion of time of small-business owners and managers towards 
numerous compliance-related tasks. The paperwork can take one 
or two hours per week, but the opportunity costs include the 
constant distraction of worrying about what might be required. 
42 percent of small-business owners say that they have delayed 
or halted business investments due to the uncertainty about 
existing requirements, while 39 percent did so because of the 
uncertainty related to a new, pending regulation. Inc. Magazine 
reports that 545 federal regulations affecting small business 
were issued in 2015 alone.

    America's Flawed Approach to Regulation

    The onerous burden of regulation is typically met with 
calls for de-regulation. When push comes to shove, however, 
most Americans want government oversight over clean water, safe 
workplaces, and caring nursing homes.

    The core flaw of American regulation, in my view, is that 
it leaves no room for practicality: Bureaucratic detail 
suffocates everyone, including the regulator. There's no room 
for balancing different considerations, or, indeed, even for a 
discussion on what's sensible. Public goals are irrelevant; 
what matters is compliance with thousands of rules--an 
impossible task even for large businesses.

    Getting permits is the threshold requirement for doing 
business or constructing infrastructure or buildings. Over the 
past 50 years, myriad licenses have been required--most for 
good reasons, such as compliance with fire codes or 
environmental goals, and some for anti-competitive reasons, 
such as onerous requirements to get a license to be a 
hairdresser. In some states, a barber or cosmetologist needs 
ten times as much training as an emergency medical technician.

    Government rarely coordinates all these permitting 
requirements. The budding entrepreneur is expected to run a 
gauntlet of different agencies without so much as a roadmap of 
where to go. Mayor Michael Bloomberg found that opening a 
restaurant in New York City required permits from as many as 11 
agencies. A prospective lessor in Washington, DC must file five 
forms with three different agencies to obtain permits to rent 
out a condominium. Sometimes the requirements are duplicative: 
Getting certified as a home care worker in New Jersey, for 
example, requires the same background checks and fingerprinting 
by two different agencies, adding unnecessary costs and delay 
before being able to work.

    Disjointed permitting and regulation impose painful and 
unnecessary costs on all Americans. The inability to rebuild 
America's decrepit infrastructure is a case in point. The 
accretion of well-meaning review and permitting requirements 
from all levels of government results in delays of upwards of a 
decade on major projects. In my 2015 report, ``Two Years, Not 
Ten Years,'' I found that a six-year delay more than doubles 
the cost of projects. I also discovered that lengthy 
environmental review is often harmful to the environment, 
because it prolongs fixing traffic bottlenecks and inefficient 
power grids. These delays hurt small construction companies by 
deterring valuable projects and hurt small business generally 
by imposing unnecessary blackouts, traffic jams, shipping 
costs, and other effects of outmoded infrastructure.

    The delays in infrastructure permitting are generally not 
the result of ``over-regulation''--greener countries such as 
Germany give permits in one or two years. The delays are caused 
by the balkanization of approvals among multiple agencies at 
all levels of government. A project to raise the roadway of the 
Bayonne Bridge, for example, required 47 permits from 19 
different agencies. The project had virtually no environmental 
impact, because it used existing bridge foundations, but still 
required an environmental assessment of 20,000 pages, including 
appendices. This is not good government; it is regulation 
devouring the public good instead of enhancing it.

    Over the past 50 years, American regulation has grown into 
a dense jungle of uncoordinated requirements. It fails not 
because the goals of, say, environmental review or worker 
safety, are invalid, but because it tries to meet those goals 
with thousands of detailed dictates emanating from scores of 
different regulatory agencies. It suffers the mindlessness of 
central planning--not allowing people to adapt to practical 
problems on the ground. But, worse, there is not one central 
planner, but dozens who often make inconsistent demands. Worse 
still, all those central planners are dead; they wrote the laws 
and regulations decades ago, and small business must comply 
even if the rules make no sense anymore.

    Studies suggest, for example, that worker safety rules 
often have had little impact on worker safety. This doesn't 
mean the federal government should not oversee worker safety. 
It means it should replace the micro-management model with a 
goal-oriented oversight that focuses on results. It truly 
doesn't matter if ``material safety data sheets'' for common 
workplace products--say, soap and cleaning products--are kept 
in plain view. How do we expect someone running a small 
business to keep straight that and thousands of other 
requirements?

    A fundamental flaw in America's regulatory structure is 
that no one is in charge. There's no one with the 
responsibility to ask, ``What's the right thing to do here?'' 
No one in government has the job of balancing the demands of 
different agencies. No one has the job of giving a small 
business a permit. Instead, American regulation is a dense 
legal jungle, impenetrable to all except large companies with 
legal staffs of hundreds of lawyers.

    Making Regulation Practical for Small Business

    What's needed is a broad overhaul--replacing command-and-
control dictates with radically simpler regulatory goals, with 
clear lines of authority so that citizens do not get whipsawed 
by conflicting or duplicative requirements.

    For small business, the threshold question is the practical 
ability of a real person to deal with myriad public goals. 
Government must respect the limited time and resources of 
Americans who have the spirit and resourcefulness to start 
businesses that keep America going. It must make clear its 
goals and allow small business owners to use their common sense 
in achieving them. The result will be greater compliance with 
crucial societal norms.

    To succeed, regulation must also be understandable. Clear 
and concise principles and expectations must replace dense 
instruction manuals. If the language is too complex and 
voluminous, it undercuts compliance rather than ensuring it. 
There will always be disagreements, but instead of fights over 
the parsing of words in Section 526(v)(2), let them argue over 
the best way to accomplish public goals.

    A simpler system requires giving officials the authority to 
make decisions. This is our choice: either a jungle of 
thousand-page rulebooks, or a simplified framework where 
officials make choices to give permits and make regulatory 
decisions. These choices can be readily second-guessed by other 
officials, and ultimately by courts, but there's no other 
alternative. The only cure to dense bureaucracy is human 
responsibility.

    Accepting the role of human responsibility requires 
overcoming myths that drive bad decisions from both sides of 
the aisle. The liberal myth about the current regulatory system 
is that detailed rules make sleazy operators do what's right. 
But the current system is so dense that enforcement is 
haphazard, and encourages bad operators to ignore the rules 
altogether.

    The conservative myth is that detailed rules deter 
officials from exercising arbitrary power. But when laws are 
unknowable, and demand impractical perfection, regulators wield 
arbitrary power: a business with exceptional worker safety may 
be penalized for paperwork violations. Lawyers step in where 
regulators have left off, bringing lawsuits for minor 
infractions of detailed specifications that do little to 
advance desired public goals. A small business was sued for ADA 
noncompliance after installing a soap dispenser an eighth of an 
inch above the prescribed height for use by someone in a 
wheelchair.

    Replacing the Regulatory Jungle

    Every president since Jimmy Carter has tried to prune the 
regulatory jungle. But pruning a jungle is a fool's errand. It 
is too dense. The internal logic of trying to tell people 
exactly how to comply means that the red tape will immediately 
grow back.

    Small businesses almost universally call for a new paradigm 
for government regulation. In a 2012 survey conducted for 
Common Good by Clarus Research Group, 86 percent of small-
business leaders said that regulations would be more effective 
in protecting public health and safety if they gave ``clear, 
certain goals'' and ``more freedom to use common sense in 
making daily decisions.''

    There is also widespread public support for this approach. 
A national survey of voters conducted in May 2017 also by 
Clarus Research Group found that 62 percent of voters favor 
making ``laws that give civil servants basic goals and 
principles on how to do their jobs along with the flexibility 
to work out the details on their own.'' 56 percent of 
Republicans, 63 percent of independents, and 67 percent of 
Democrats agree.

    It is time that Congress heeded their call. Here are three 
initiatives that would move forward a new simplified regulatory 
regime, which honors the human scale and capacity of small 
business:

          1. Pilot projects for simpler goal-oriented 
        regulations. Congress should appoint an independent 
        commission to design pilot projects to test simpler 
        goal-oriented regulations for small business. Thee 
        pilots could, for example, consolidate into one 
        department all federal, state, and local compliance 
        related to employees: Fair Labor Standards Act, 
        workers' compensation, unemployment insurance, etc. 
        This oversight agency could readily be a state agency, 
        and Congress could condition federal funding on such 
        efforts at the state level. The commission could also 
        identify duplicative and obsolete laws that need to be 
        repealed, such as licensing requirements that mainly 
        serve as barriers to entry for new businesses.

          2. Establish one-stop shops for permitting. 
        Government should do the work of coordinating different 
        agency demands, not require aspiring entrepreneurs to 
        trudge from agency to agency. Congress could create a 
        pilot project for a coordinating department, perhaps 
        within the U.S. Small Business Administration, which 
        would act as the point of contact for small businesses 
        needing a federal permit. Because different agencies 
        often disagree, Congress could also create clear lines 
        of authority up to the White House, to make sure 
        applicants get a decision on a timely basis.\1\
---------------------------------------------------------------------------
    \1\ In New York City, the NYC Business Acceleration Team helps 
fledgling food and beverage businesses navigate the city's regulatory 
system. A similar program was created in Los Angeles that cut the time 
that restaurants spent on the permitting process in half.

          3. Privatize enforcement. No level of government has 
        sufficient resources to check on the over 29 million 
        small businesses. Similarly, few small businesses have 
        the capacity to understand certain complex areas of 
        regulation, such as environmental regulation. A 
        solution here might be to create a safe harbor for 
        businesses that receive a regulatory compliance letter. 
        Just as most businesses have financial auditors who 
        bless their books, they could have a ``certified 
        regulatory expert'' to monitor their compliance and 
        issue compliance letters. These regulatory experts 
        could work with the business to make sure that they are 
---------------------------------------------------------------------------
        in substantial compliance.

    The spirit of America arises from the sense of personal 
ownership of life's choices. It is this ownership that empowers 
people to innovate, to take risks, and to pick themselves up 
when they fail. Today, it is hard for anyone to accomplish 
anything without a huge legal staff. The American can-do spirit 
is bogged down by the accumulation and complexity of regulatory 
requirements.

    The solution is not to abandon important regulatory goals, 
but to dredge out the regulatory muck and replace it with buoys 
that make sure people stay within accepted channels. A new 
simplified system of regulation will not only reduce the 
monetary costs imposed on small businesses, but open the door, 
now blocked by countless rules, to the deep store of creativity 
that resides in current and prospective small-business leaders.

    Thank you for this opportunity to appear before you.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

    Chairman Chabot, Ranking Member Velazquez, and members of 
the committee, thank you for inviting me to testify at this 
hearing on behalf of the National Stone, Sand & Gravel 
Association, (NSSGA), on how streamlining federal permitting 
can cut red tape for small businesses and expedite economic 
growth.

    The National Stone, Sand & Gravel Association and Industry

    NSSGA is the world's largest trade association by product 
volume representing the mining industry. There are 10,000 
construction aggregates businesses across the United States. 
These are located in every state and nearly every congressional 
district. More than 70% of NSSGA members are small businesses. 
It is an industry that directly employs over 100,000 people, 
and each of those 100,000 jobs indirectly supports an 
additional 4.87 jobs throughout the economy. Overall, NSSGA 
member companies represent more than 90% of the crushed stone 
and 70% of the sand and gravel produced and consumed annually 
in the United States. NSSGA's primary concern is a full-funded, 
robust highway trust fund. While nothing can take the place of 
these critical federal funds, regulatory over-reach can cause 
costly project delays, so regulatory reform is of great 
importance.

    The United States annually consumes approximately 2.8 
billion tons of aggregates annually. Crushed stone, sand and 
gravel typically make up over 80% of ready mixed concrete and 
over 90% of hot mixed asphalt. On a four-lane road, for 
example, one lane alone requires an average of 38,000 tons of 
construction aggregates for every mile. Aggregates are used in 
nearly all residential, commercial, and industrial building 
construction and in most public works projects, including 
roads, highways, bridges, dams, and airports. A new school or 
hospital typically requires 15,000 tons of aggregates in its 
construction. Aggregates are used for many environmental 
purposes including: treating drinking water and in sewage 
treatment plants, for erosion control and in cleaning air 
emissions from power plants. While Americans take for granted 
this essential natural material, it is imperative for 
construction.

    Unlike other businesses, we cannot simply choose where we 
operate. We are limited to where natural forces have deposited 
the materials we mine. Not every aggregates deposit meets the 
stringent standards set by the Federal Highway Administration 
(FHWA) and state Departments of Transportation (DOTs) for use 
in federal or state projects. So, our operations are limited to 
areas that are near cities and roads where they are needed. 
Generally, once aggregates are transported outside a 25-mile 
limit, the cost of the material can increase 30 to 100% in 
addition to creating environmental and transportation concerns. 
Because our product is so heavy, over 90% of aggregates are 
used within 50 miles of their original location, making our 
industries' businesses uniquely tied to their community.

    The aggregates business ca be described as making small 
rocks out of larger ones. We extract material for processing 
into crushed, sized, and washed stone. For safety and 
efficiency purposes, our operations tend to utilize large 
parcels of land that must be located where quality rock 
naturally occurs. Our operations are heavily regulated before, 
during and after extraction. Our primary waste is finer crushed 
rock or dust from processing. For this we must perform a number 
of ``one size fits all'' controls required under air and water 
permits. Our facilities are routinely monitored to ensure we 
are operating in a safe and environmentally responsible manner. 
Some of the requirements make sense and others do not, 
particularly for small businesses.

    It gets even more complicated when we need to expand our 
operations, open a new or temporary operation, or merely do 
minor construction work at a site to upgrade our facilities to 
provide needed material for crucial infrastructure projects. A 
host of federal requirements come into play, among them the 
Clean Water Act, the Endangered Species Act, and the Historic 
Preservation Act. These statutes often require businesses to 
prove that we should not fall under their jurisdiction. A 
``regulated until proven otherwise'' approach is very costly 
and difficult for any business, particularly a small company 
like mine, without the resources for dedicated compliance staff 
that larger corporations employ. This is not an efficient use 
of resources for either the company or the agencies, and 
punishes the businesses who are trying to comply and care 
deeply about safety and the environment. It also shifts limited 
federal enforcement dollars away from actually protecting the 
environment.

    Springfield Underground

    I am a past chairman of NSSGA and have worked in the 
industry since 1977. I appear today to stress the negative 
impact that excessive regulation has on small businesses like 
mine. My family's business was started in 196 by my father and 
uncle, who discovered limestone while digging a farm pond and 
recognized the need for road material in nearby Springfield, 
Missouri. Springfield Underground now employs 43 people, and in 
addition to supplying construction aggregates, we also use our 
former underground operations as cold storage for major 
corporations such as Kraft, Heinz, and Cargill. Like me, some 
of our employees are the second or third generation of their 
families to work at Springfield Underground.

    I want to be clear that I am not against regulation, nor is 
NSSGA; in fact, as the co-chair of the Mine Safety Health 
Administration-NSSGA Alliance, I have led cooperative 
discussions with MSHA to develop and disseminate education and 
training materials intended to boost workplace safety and 
health for ten years. The MSHA-NSSGA Alliance is the first 
alliance MSHA ever entered into and is also its most active 
alliance. It has been very productive in terms of training 
programs for increased safety and efficient use of government 
and business resources. Last year, the industry finished with 
an injury incidence rate of just 1.95 injuries per 200,000 
hours worked; the 16th year in a row in which our sector 
achieved a lower rate than in the prior year. We have found 
that we can accomplish more by working with agencies, rather 
than having just a ``command and control'' relationship. 
Unfortunately, not all my experiences with federal agencies 
have been as positive. In too many cases, agencies 
unnecessarily slow down projects.

    The Small Business Administration estimates that 
regulations cost 36% more for small businesses per employee 
than for larger companies. At Springfield Underground, we 
simply do not have the resources that larger corporations use 
to comply with confusing and overlapping regulations. We 
support efforts to reform the regulatory environment, 
recognizing that any reform is likely to benefit small 
businesses greatly because we suffer the most under the current 
structure.

    Infrastructure Depends on Aggregates, but Federal 
Requirements Hamper Us

    Through its economic, social and environmental 
contributions, aggregates production helps to create 
sustainable communities and is essential to the quality of life 
Americans enjoy. Aggregates are a high-volume, low-cost 
product. Because so much of our material is used in public 
projects, any cost increases are ultimately borne by the 
taxpayer. When aggregates producers are finished using the 
stone, sand or gravel in an area, they pay to return the land 
to other productive uses, such as water reservoirs, residential 
developments, farm land, parks, nature preserves, or in our 
case, underground storage.

    On the federal level, we fall under regulations by the 
Department of Labor, Environmental Protection Agency, Fish and 
Wildlife Service and the Army Corps of Engineers. The 
Department of Homeland Security and the United States Treasury 
Department also regulate us because we engage in blasting. At 
the state level, we obtain approvals from state agencies for 
air and water quality permits and mining and blasting permits. 
At the local level, multiple layers of land use approval are 
required before we can open a new facility or even expand an 
existing one. But I don't want to complain about reasonable 
regulations that have defined benefits and are enforced fairly. 
The members of our industry comply every day with safety and 
environmental regulations that we support wholeheartedly as an 
industry. There are, however, regulations that provide no 
demonstrable public benefit, that delay or kill projects, and 
that cost many good jobs in construction and related fields. As 
government is the largest consumer of construction aggregates, 
the cost of excess regulation falls on the American taxpayer.

    In particular, the application of the Endangered Species 
Act (ESA) and what constitutes a Waters of the United States 
have been expanded far beyond what Congress intended, and more 
often than not these act as an impediment to any development. 
For example, Section 7 ESA consultation by the Fish and 
Wildlife Service (FWS) is open-ended and lacking procedural 
guardrails that can be relied upon to define the scope, 
sequence and timing of agency review and action. Even when all 
the required information is provided, the FWS can take months 
or years to reach a decision. Permits in the U.S. take far 
longer to obtain than other developed countries, and the ESA is 
a major culprit. The ESA process has become a true impediment 
to any sort of development through a lack of timely response by 
FWS employees, who can delay projects significantly.

    As previously mentioned, these problems are exacerbated 
with small businesses, because we do not have the same 
resources as large corporations to handle the4se issues. Small 
businesses have to run this overwhelming gauntlet of 
regulation, and it can cost jobs with very little (if any) 
benefit.

    Examples of Federal Requirements that Harm Business

    Small businesses like mine that have projects stalled over 
the ESA sometimes don't even involve the presence of endangered 
species, and can create a domino effect that hurts other 
businesses and citizens alike. In our case, we had approved 
plans from our city for an expansion of our tractor-trailer 
parking lot. When a state road contractor needed a place to 
dispose of crushed pavement from repaving MO Highway 65 in 
Springfield, we contracted with them to take the material as 
fill for this parking lot. This material had to be removed from 
the road so that repaving of an important artery in Springfield 
could occur. Highway 65 not only is the major commuter highway 
to Christian County (fastest growing county in Missouri), it is 
the tourist route to Branson from Interstate 44. The Missouri 
DOT put incentives in place for rapid completion. We applied 
for a land disturbance permit that was delayed, first by FWS, 
but then even longer by the Missouri Department of 
Conservation, who both required a study to determine if we were 
in a breeding area for the endangered bat. The habitat that we 
would potentially destroy amounted to a dozen trees and some 
brush. The permit was delayed by four weeks. It seems 
reasonable that this small area could have been excluded in a 
shorter period of time, while balancing the need for retaining 
habitat.

    That's an eternity for a state highway project like this. 
Finally, after all this, the Missouri Department of 
Conservation determined that we are not in a bat breeding zone. 
This may not seem like a long delay, but consider that lanes 
were closed and a major long-term road improvement could have 
been unnecessarily delayed, creating a ripple effect that 
impacts nearly all other businesses and citizens in the area 
due to commuting delays.

    Sometimes NSSGA members agree to unreasonable conditions 
rather than accept long delays. One small business agreed to 
$125,000 of mitigation at another site in order to proceed with 
a project rather than have the project be delayed indefinitely 
by having a permit application be put into pending status by 
FWS. That was a significant financial burden for a small 
family-owned business, but had to happen so that commitments to 
highway departments and other customers could be met. This is a 
case of a business agreeing to an agency's incorrect assessment 
in order to proceed.

    Another NSSGA member has faced a delay of eight years 
waiting for the issuance of a Biological Opinion by FWS. This 
project involved an open engagement process involving meetings 
between federal agencies and local wildlife groups. The 
permitting process and mitigation requirements for species 
compensation reduced the project size from 1,100 acres to now 
less than 400 acres. This process led to a finalized group 
consensus years ago, but the assigned FWS biologist has 
repeatedly delayed finalization of the biological opinion. This 
is a project that has met relevant criteria, and has cost the 
significant investment in money, time and other resources by 
the member company, but has not been allowed to proceed.

    In another example, a member worked diligently to protect 
the habitat and the listed species on a site, but has faced a 
delay of over a year waiting for an incidental take permit for 
a facility expansion. These delays harm not only the companies 
producing building materials and the infrastructure projects 
that rely on them, but also delay important conservation 
efforts.

    NSSGA supports the administration's withdrawal of the 2015 
Waters of the United States Rule, which would have radically 
expanded jurisdiction under the CWA to include areas suspected 
of only tenuous connections to navigable waters. While the 
agencies' decision to return to the ``pre-rule'' status quo 
once the 2015 rule is rescinded is not an ideal long-term 
solution, the action at least restores the guidance that 
aggregate operators are familiar with while the agencies work 
to develop a rule that provides clarity and certainty. While 
the 2015 rule would have cost aggregates operations millions of 
additional dollars in mitigation to expand or open new 
facilities, the current system is cumbersome and lengthy. Like 
ESA consultation, determining applicability under the CWA can 
create confusion and delays which are particularly burdensome 
for small businesses.

    The water on our site contains only natural dust, but under 
the CWA is called ``process'' water and requires a CWA/National 
Pollutant Discharge Elimination System (NPDES) permit for 
discharge, which sets strict limits on what can be in the 
water. We work to recycle this water and use it for dust 
suppression as part of our air permit required by the Clean Air 
Act. These permits are handled by the state, but the state 
permits are approved by the EPA. One of our sites was audited 
by EPA and warned that there were no signs designating the 
outflow points on our property, even though this is not a 
requirement of the state permit. This is just the sort of 
federal ``check the box'' requirement that does not improve the 
environment, but rather creates needless work and cost for 
small business.

    Our air permit requires that we apply 100 gallons of water 
per day for every 1000 square feet of unpaved area unless it is 
freezing or unless 1/4'' of rainfall has occurred. In the 
spring and in the fall in Missouri it is cool and humid enough 
that the ground doesn't dry out and create dust, yet we still 
have to comply with this requirement. Putting that much water 
down creates a sticky mess that clings to truck tires. We then 
have to provide wash stations so the trucks don't track that 
out onto the public roads. This site is also close enough to 
the Springfield-Branson National Airport that the Federal 
Aviation Administration doesn't want us to impound water that 
will attract migratory birds that could affect planes taking 
off and landing. Of course, that leaves us without sufficient 
water supply for our water trucks in the summer time when it is 
most needed. This is just one example of where multiple, 
conflicting requirements cause problems that cost additional 
money to solve, again, without helping improve the environment.

    While we have had success working with the Mine Safety 
Health Administration, numerous programs and requirements could 
be improved, particularly those that impact small businesses. 
The industry has a great safety record and we want to make sure 
every regulation has a demonstrable effect in improving safety 
or the environment.

    To summarize, businesses like mine are put into impossible 
situations, such as trying to prove a negative, while federal 
agencies can stop projects nearly at will under the guise of 
authority under CWA or ESA.

    Suggestions for Improvement

    Congress and the administration have come up with some 
great ideas for cutting red tape, and I would urge you to move 
forward with some of these. In particular, NSSGA supports:

          1) Look at the impacts to small businesses 
        beforehand: The Small Business Regulatory Flexibility 
        Act should be expanded to include the Fish and Wildlife 
        Service and the Mine Safety and Health Administration's 
        rules so that impacts to small businesses must be 
        evaluated for major rules in the same way that rules 
        for EPA and OSHA are evaluated. SBREFA should be 
        strengthened by not allowing agencies to improperly 
        claim their rules do not meet the threshold, in 
        addition to other reforms.

          2) Improve the permitting process, deadlines and 
        transparency: Currently small businesses often feel 
        they are guilty until they prove themselves innocent 
        and agencies are not accountable to respond to them in 
        a timely fashion, or multiple agencies have overlapping 
        requirements. The environment and worker safety an 
        still be protected or even improved by making the 
        process more transparent, timely and less adversarial.

          3) Agencies should be held accountable: Just as 
        businesses are accountable, so should agencies. 
        Congress should ensure that they are fulfilling their 
        core functions under the appropriate acts, while not 
        promulgating unnecessary burdens and delays on 
        industry.

          4) Reform efforts should be continuous: Periodic 
        review of rules should be required as well as updating 
        outdated statutes to better respond to changing 
        conditions.

    We support reasonable regulation, based on science, that 
preserves our natural resources, protects our environment and 
ensures the safety of our employees and neighbors. We are 
opposed, however, to overreaching regulation that hurts our 
businesses and by extension, infrastructure. I appreciate this 
opportunity to speak on how streamlining federal permitting 
could help small businesses like mine, that are the lifeblood 
of our nation's economy. Thank you, Mr. Chairman, and I will be 
happy to respond to any questions.
    United States House of Representatives Small Business Committee


                      Testimony of Mark C. Hayden


             General Manager, Missoula Electric Cooperative


 ``Expediting Economic Growth: How Streamlining Federal Permitting Can 
                  Cut Red Tape for Small Businesses.''


                           September 6, 2017


    Good morning Chairman Chabot, Ranking Member Velazquez, and 
members of the Committee, my name is Mark Hayden, and I am the 
General Manager of Missoula Electric Cooperative (MEC) in 
Missoula, Montana.

    Thank you for the opportunity to testify today, and 
allowing me to share my thoughts on how streamlining federal 
permitting can cut red tape for small businesses. Missoula 
Electric Cooperative is a proud member of the National Rural 
Electric Cooperative Association, the Montana Electric 
Cooperatives' Association, and the Northwest Public Power 
Association. By way of background, MEC is a consumner-owned 
electric utility serving the electric distribution needs of 
approximately 15,000 meters in Western Montana and Eastern 
Idaho. Our workforce includes 41 skilled and dedicated 
employees committed to serving the energy needs of our member-
owners. The nearly 2,000 miles of distribution line that we 
maintain deliver energy to some of the most wild and scenic 
locations in the country--286 miles of which cross federal 
land.

    For me, the timing of this hearing could not be more 
appropriate. The wildfires burning in Western Montana are 
having a devastating effect on our state and local economies. 
Currently five active fires have burned nearly 250,000 acres 
in, or adjacent to, MEC's service territory, and personnel 
totaling nearly 2,500 are protecting lives and property on many 
fronts. Lives have been lost, homes have been lost, and 
hundreds of resident evacuations due to the threat of fire, 
including my own family. In the small community of Seeley Lake, 
smoke concentrations have hovered in the hazardous range for 
weeks, and a lake normally bustling with summer recreationists 
has been closed to allow aircraft access to the precious fire-
fighting water resource. In short, a community whose economy 
relies heavily on summer tourists has been dealt a devastating 
blow. I fully recognize that the fires burning in Montana today 
were all lighting sparked, but also realize the increased risk 
that long delays in federal approval of permit applications, 
inadequate fuels reduction programs, and other factors bring to 
our co-op and to our infrastructure.

    Electric cooperatives face a myriad of permitting and 
regulatory requirements in order to conduct our business. For 
some it may be permitting a new gas plant, and for others 
relicensing an existing small hydropower installation. At MEC, 
our permitting challenges have centered around our Special Use 
Permits and the National Environmental Policy Act (NEPA) review 
process used to amend these agreements. We work diligently to 
maintain positive relations with those who hold the permits 
authorizing our power lines on federal land, primarily the U.S. 
Forest Service and to a lesser degree the Bureau of Land 
Management. However, long delays in application processing 
hinder our ability to adequately plan, and add significant 
project cost.

    We are constantly working to improve system reliability and 
reduce the risk of power-line-caused wildfire, and vegetation 
management is a critical component of our program, especially 
on federal land. A great example of this occurs regularly in 
the clearing of danger trees outside of our rights-of-way 
during our co-op's Routine Operations and Maintenance 
activities. Representatives from MEC and local Forest Service 
officials communicate periodically and expectations are 
understood. As a result, managers and crews can adequately plan 
for the time and financial resources necessary to complete a 
project. But this positive situation is not found on all 
rights-of-way managed by the Forest Service. Other cooperative 
representatives have testified before Congress of inconsistent 
federal land management policies, long delays in approval and 
review times, and unnecessary liability resulting from these 
delays.

    In short, federal reforms are needed to cut red tape and 
make it easier for electric cooperatives to manage vegetation 
to limit downed power lines, prevent catastrophic fires, and 
respond to emergencies.

    For that reason, we commend the House for recently passing 
H.R. 1873, the ``Electricity Reliability and Forest Protection 
Act'' that received strong bipartisan support. This legislation 
would give electric utilities more consistent procedures and a 
streamlined process in order to better manage utility rights-
of-way.

    Unfortunately, in other cases, significant delays occur, 
especially during major Operation and Maintenance activities, 
where compliance with NEPA is a concern. Such approvals are a 
requirement of our Special Use Permit, and necessary to 
assuring electricity service is not jeopardized as a result of 
work needed on rights-of-way.

    For my co-op in Montana, our service area, like so many 
parts of the West, has been adversely affected by the Mountain 
Pine Beetle infestation and the dead and dying trees left in 
its wake. One of the areas hardest hit is in the Swan Valley 
north of Seeley Lake, Montana. Obviously, one of the most 
effective ways to improve service reliability and mitigate fire 
risk is to bury an overhead power line. As you can imagine, 
each instance of tree/power line contact can pose significant 
risk of wildfire ignition under the right environmental 
conditions. However, converting overhead distribution lines to 
underground is an expensive proposition, especially for a small 
cooperative like MEC, so this cannot be standard practice.

    After considerable internal discussions regarding our 
situation in the Swan Valley, the decision was made in December 
2013 to request permission to bury approximately 6.1 miles of 
overhead three-phase line on Forest Service land. An 
application was submitted to the Forest Service district office 
having jurisdiction over the proposed project, and, just one 
month after submittal, we were notified that approval of our 
request was expected by June of 2014.

    In May of 2015 I was invited to provide testimony before 
the House Subcommittee on Water, Power and Oceans regarding the 
delay in approval of this project application. In preparation 
for my testimony, I placed one final call to the local Forest 
Service District Ranger to express my frustration just prior to 
the subcommittee hearing. This local official indicated that if 
i wanted to see things change I should take up my issue with 
Congress, at which point I told him that I intended to the 
following week! Two days later on Saturday, May 16th, the 
weekend prior to the hearing, MEC received unofficial notice 
via email that all associated field work had been completed on 
our project, confirmed that our co-op had paid the Forest 
Service for all associated costs, and that we were authorized 
to begin construction.

    In all, MEC waited nearly 18 months for approval on the 
Swan Valley project. Our cost recovery bill from the Forest 
Service indicates that 10 different individuals spent an 
average of 2.3 days each on our project. Most troubling to me 
is that the project qualified for categorical exclusion, 
meaning neither an environmental assessment or environmental 
impact statement was required. I can only imagine the number of 
months or years project approval would have taken had those 
more in-depth investigations applied.

    This situation I have described exemplifies the harm to 
small businesses of unnecessary delays. To be effective in 
business requires adequate planning, especially for large 
construction projects, and the current process for federal 
permit approvals makes that impossible. Firm timelines must be 
incorporated into the approval process, and early, consistent 
consultation with coordinating agencies should be mandated. The 
uncertainly surrounding the approval process when working with 
the Forest Service adds unacceptable risk to every project. For 
example, materials ordered too early not only add to the 
carrying cost during the delay, but also the risk of outright 
cancellation if the permit is not approved. Materials ordered 
too late risk long lead times in which an entire construction 
season can be lost to the changing seasons. When service 
liability and fire prevention are a concern, inconsistency and 
delays risk unnecessary power interruption and increased 
potential for powerline sparked fires. All this leads to higher 
costs, which, ultimately, are borne by the owners of our 
cooperative utility--our members.

    Proper vegetation and fuels management on federal land not 
only affects our utilities operations, but also those of our 
customers. Many of our customers, including large commercial 
accounts, are directly impacted by the Forest Services' actions 
in our region. For example, our largest customer is one of the 
few remaining family-owned lumber mills operating in Montana, 
and in working closely with them, I get to hear firsthand about 
some of the challenges faced by this small business. An 
executive at the company tells me he views the cumbersome and 
time-consuming process to fulfill NEPA requirements as the 
single most important barrier to implementing timely 
stewardship and restoration treatments on our National Forests. 
The process commonly has evolved into PhD dissertation of 400-
800 pages for every decision to be approved by a line officer 
within the Forest Service. According to him, this process 
averages 3-5 years if there are no delays or interruptions from 
budget delays or fire suppression costs, which consume manpower 
and resources.

    Montana's Governor has identified nearly 5 million acres of 
hazardous fuel conditions across the state in need of immediate 
fuel reduction treatments to reduce excess forest fuels. Over 
590,000 acres across various ownerships in Montana have burned 
so far this year. Regulatory barriers to proper vegetation and 
fuels management threaten not only the operations of our 
utility and the livelihoods of our members, but also of those 
businesses we serve.

    Not all the challenges we face stem from NEPA. Earlier this 
year, our small utility submitted a second request for burial 
of a power line located in a different Forest Service district 
from the one I mentioned previously. This straightforward 
project proposes to bury approximately 4 miles of overhead 
line, much of which is located in heavily wooded forest today. 
The new location would be in highway right-of-way along U.S. 
Highway 12. Regarding that request, I just received 
communication asking if we had considered delaying our project 
until next spring, even though it has been communicated that 
NEPA is not an issue. Problems cited by the Forest Service 
include delays in consultation with coordinating agencies, and 
resources stretched thin because of fire. We fully understand 
the reality of these factors, but believe that cross-agency 
consultation, review, and approval for a very straightforward 
and routine application should not take a year to achieve.

    Mr. Chairman, members of the committee, for us the status 
quo is not an option. We need streamlined, expedited procedures 
that allow for timely implementation of projects to protect the 
long-term health of our forests, our small businesses, and the 
overall economies of the communities we serve. The best way to 
accomplish this is to provide consistency, flexibility, and 
accountability into the federal permitting and permit amendment 
processes, especially when system reliability and fire 
prevention are driving factors. We believe this can be done 
without abrogating the intent of federal regulations. I 
appreciate this Committee's work in examining how small 
businesses, such as Missoula Electric Cooperative, can benefit 
from regulatory reform and for holding this hearing today.

    Thank you again for the honor of testifying before this 
Committee and I will be pleased to answer any questions.
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