[Senate Hearing 115-54]
[From the U.S. Government Publishing Office]




                                                         S. Hrg. 115-54
 
                    WATER RESOURCES: THE ROLE OF THE
                       PUBLIC AND PRIVATE SECTORS

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

                                HEARING

                               before the

                    SUBCOMMITTEE ON TRANSPORTATION 
                           AND INFRASTRUCTURE

                                 of the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 9, 2017

                               __________

  Printed for the use of the Committee on Environment and Public Works
  
  
  
  
  
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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                     ONE HUNDRED FIFTEENTH CONGRESS
                             FIRST SESSION

                    JOHN BARRASSO, Wyoming, Chairman
JAMES M. INHOFE, Oklahoma            THOMAS R. CARPER, Delaware
SHELLEY MOORE CAPITO, West Virginia  BENJAMIN L. CARDIN, Maryland
JOHN BOOZMAN, Arkansas               BERNARD SANDERS, Vermont
ROGER WICKER, Mississippi            SHELDON WHITEHOUSE, Rhode Island
DEB FISCHER, Nebraska                JEFF MERKLEY, Oregon
JERRY MORAN, Kansas                  KIRSTEN GILLIBRAND, New York
MIKE ROUNDS, South Dakota            CORY A. BOOKER, New Jersey
JONI ERNST, Iowa                     EDWARD J. MARKEY, Massachusetts
DAN SULLIVAN, Alaska                 TAMMY DUCKWORTH, Illinois
RICHARD SHELBY, Alabama              KAMALA HARRIS, California

              Richard M. Russell, Majority Staff Director
               Gabrielle Batkin, Minority Staff Director
                              ----------                              

           Subcommittee on Transportation and Infrastructure

                  JAMES M. INHOFE, Oklahoma, Chairman
SHELLEY MOORE CAPITO, West Virginia  BENJAMIN L. CARDIN, Maryland
JOHN BOOZMAN, Arkansas               BERNARD SANDERS, Vermont
ROGER WICKER, Mississippi            SHELDON WHITEHOUSE, Rhode Island
DEB FISCHER, Nebraska                JEFF MERKLEY, Oregon
JERRY MORGAN, Kansas                 KIRSTEN GILLIBRAND, New York
JONI ERNST, Iowa                     EDWARD J. MARKEY, Massachusetts
DAN SULLIVAN, Alaska                 TAMMY DUCKWORTH, Illinois
RICHARD SHELBY, Alabama              KAMALA HARRIS, California
JOHN BARRASSO, Wyoming (ex officio)  THOMAS R. CARPER, Delaware (ex 
                                         officio)
                                         
                                         
                            C O N T E N T S

                              ----------                              
                                                                   Page

                              MAY 9, 2017
                           OPENING STATEMENTS

Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     1
Cardin, Hon. Benjamin, U.S. Senator from the State of Maryland...     5

                               WITNESSES

Semonite, Lieutenant General Todd T., Commanding General and 
  Chief of Engineers, U.S. Army Corps of Engineers...............     7
    Prepared statement...........................................     9
    Response to an additional question from Senator Duckworth....    12
Lyons, James K., Director/CEO, Alabama State Port Authority......    13
    Prepared statement...........................................    15
Humphreys, Grant, Town Founder, Carlton Landing, Oklahoma........    21
    Prepared statement...........................................    24
Rahn, Pete K., Maryland Secretary of Transportation..............    66
    Prepared statement...........................................    68
Goche, Rick, Commissioner, Port of Bandon........................    72
    Prepared statement...........................................    74

                          ADDITIONAL MATERIAL

Letter from American Rivers, Rivers Connect Us...................    99


      WATER RESOURCES: THE ROLE OF THE PUBLIC AND PRIVATE SECTORS

                              ----------                              


                          TUESDAY, MAY 9, 2017

                               U.S. Senate,
         Committee on Environment and Public Works,
         Subcommittee on Transportation and Infrastructure,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:33 p.m. in 
room 406, Dirksen Senate Building, Hon. James Inhofe (chairman 
of the subcommittee) presiding. Present: Senators Inhofe, 
Capito, Boozman, Moran, Ernst, Sullivan, Shelby, Cardin, 
Merkley, Gillibrand, Markey, Duckworth and Harris.
    Senator Inhofe. Committee will come to order.
    Since we do have members here who want to be recognized to 
introduce different ones, I happen to be one of those, I think 
we might go ahead before opening statements and do that before 
we lose someone.
    We already know Lieutenant General Todd Semonite. This is 
your third time here, is that correct?
    Lieutenant General Todd. Yes, sir.
    Senator Inhofe. You are a regular here.
    I would recognize at this time Senator Cardin to introduce 
Pete Rahn.
    Senator Cardin. Mr. Chairman, thank you very much.
    It is a pleasure to have Secretary Rahn here before our 
committee. He is the Secretary of Transportation for Maryland.
    As I was telling the Chairman, this is the third State 
where he has been Secretary of Transportation. He has also 
directed the Missouri Department of Transportation and the New 
Mexico State Highway and Transportation Department. He just 
cannot hold on to a job.
    We are very proud of the work he does in Maryland. We have 
a pretty challenging organization in Maryland where the 
Secretary of Transportation is responsible for all modes of 
transportation and coordinating all modes of transportation.
    Mr. Rahn has done an outstanding job in directing that 
department. It is a very large budget.
    He also served as President of the American Association of 
State Highway and Transportation Officials from 2007 to 2008. 
He has served in other positions in national leadership. We are 
proud to have him before our committee.
    Senator Inhofe. Very good.
    I will recognize Senator Merkley for your introduction.
    Senator Merkley. Thank you, Mr. Chairman and Ranking 
Member, for holding this subcommittee hearing to discuss the 
importance of investing in our ports and waterway 
infrastructure.
    I am pleased to introduce Bandon Port Commissioner Rick 
Goche from my home State of Oregon who is here to testify. Not 
only is he a port commissioner, he has been a fisherman and 
small businessman for almost 50 years. He is involved in many 
aspects of the fishing community. He owns and operates a 
fishing vessel, Peso II, and owns the Sacred Sea Tuna brand.
    He is the Chairman of the Oregon Albacore Commission. He is 
President of Aquatic Resources Inc., a consulting group for 
live seafood holding and shipping. He is Chairman of FISHCRED, 
a statewide fishermen's organization.
    Very few people know as intimately as Rick the importance 
of maintenance for our small ports, our navigation channels and 
our jetties. In fact, Rick should probably be at home preparing 
his boat for annual maintenance but he is here on behalf of the 
fishermen whose lives and livelihoods depend on this funding to 
make sure they can get to safe harbor.
    He has crossed about every bar between San Francisco and 
Canada. He is here to advocate for the Army Corps budget to 
make sure our small ports stay the economic driver of our 
coastal communities.
    Thank you for being here, Commissioner. We appreciate it.
    Senator Inhofe. Thank you. Welcome, Commissioner Goche.
    Senator Shelby, would you like to introduce Mr. Lyons?
    Senator Shelby. Thank you, Chairman Inhofe and Ranking 
Member Cardin.
    It is a great opportunity for me today to introduce James 
Lyons who is the Director and CEO of the Alabama State Port 
Authority. I am glad he could join us here today.
    I have known Jimmy and his family for many years and the 
work he has done at the Port Authority of Mobile. The Port of 
Mobile has not only been vital to our State but also to the 
Gulf Coast Region.
    Jimmy, as I said, is the Director and CEO of Alabama State 
Port Authority. The Port of Mobile is currently the tenth 
largest U.S. seaport in import and export of domestic trade by 
total volume.
    The port's largest commodities are coal, crude oil, steel 
and petroleum. In any given year, between 52,000,000 to 
67,000,000 tons of cargo is moved annually through the port. 
That number continues to grow.
    Jimmy Lyons has continuously worked to meet the growing 
demands of post-Panama Canal market. In 2014, the Port 
Authority submitted a request to the Corps of Engineers to 
consider increasing the depth and width of the Mobile Harbor 
channel to its authorized dimensions.
    The Corps subsequently began a general reevaluation report 
which examines potential costs and benefits associated with the 
deepening and widening of the port. This study is expected to 
conclude in 2019.
    Mr. Chairman, the Port of Mobile provides access to nearly 
15,000 miles of inland waterways serving the Great Lakes, the 
Ohio Valley, the upper Mississippi and Tennessee Valley ports. 
Simply put, the ports serve as an economic driver for much more 
than just Mobile.
    The new Administration has made economic growth a top 
priority to ensure that our industries and businesses, big and 
small, can continue to compete in the increasingly complicated 
global marketplace.
    To facilitate this growth, it is important that Congress 
make infrastructure legislation a priority. The Corps plays, as 
we all know an important role in modernizing our Nation's 
waterways. Corps projects provide more than $100 billion 
annually in net economic benefits. I believe this demonstrates 
the job creation and economic growth associated with such 
investments.
    I am thankful the committee today, under your leadership, 
is working to understand the challenges we are facing. I look 
forward to the testimony of all the witnesses.
    Thank you, Mr. Chairman.
    Senator Inhofe. Director Lyons, welcome.
    I will not say we saved the best to last; that sounds a 
little self-serving but we have Mr. Grant Humphreys, Town 
Founder of Carlton Landing, Oklahoma. I am happy to have Grant 
here. I have known his daddy, Kurt, for longer than he has been 
alive. It is a pleasure having you here in the capacity of what 
you are doing successfully in Oklahoma.
    He is a real eState developer, investor and homebuilder. 
About 10 years ago, Grant began the process of founding and 
developing Carlton Landing at Lake Eufaula, Oklahoma.
    Some of you may not be aware of the fact that Oklahoma has 
more miles of freshwater shoreline than any of the 50 States. 
Did you know that, Senator Shelby?
    Senator Shelby. I did not.
    Senator Inhofe. In Carlton Landing, Grant has embarked on 
an ambitious project which is already showing great successes 
which he will be sharing with us.
    In addition to founding and developing Carlton Landing, 
Grant is also the founder and principal of Traditional Craft 
Homes, a home building company providing custom and specific 
production homes.
    In developing a project on Lake Eufaula, Grant has become 
involved with a community of lake developers in the region and 
can speak to his experience and that of others with getting a 
project started.
    I welcome you here today, Grant.

            OPENING STATEMENT OF HON. JAMES INHOFE, 
            U.S. SENATOR FROM THE STATE OF OKLAHOMA

    Senator Inhofe. Today's first Transportation and 
Infrastructure Subcommittee hearing is on a subject that is 
very important to Nation, including my home State of Oklahoma. 
Our Nation's water resources provide our economy with a 
platform for the movement of goods to facilitate trade with the 
world, bring jobs and many other benefits to the communities 
that surround them.
    U.S. Corps of Engineers projects generate over $109 billion 
annually in economic benefits and generate over $34 billion in 
revenue to the United States Treasury.
    Unfortunately, like most of our infrastructure, our water 
resources are aging and in great need of repair and upgrading. 
Recognizing this need, the last two Congresses have worked to 
authorize new projects and create reforms to provide more 
Federal funding and also private investment, something we could 
not do not too long ago.
    Today's hearing will explore the benefits our water 
resources provide to local and national economies and examine 
the continued needs that must be met so the U.S. can remain 
globally competitive, provide jobs and other local benefits 
here at home.
    In Oklahoma, we know these benefits firsthand with ports 
along the McClellan-Kerr-Arkansas Navigation System connecting 
Oklahoma with the Mississippi River and with the rest of the 
world.
    With over 20 Army Corps of Engineers-managed lakes in my 
State, our industries and our citizens know the impact of our 
many water resource projects through cheaper goods, cheaper 
electricity, jobs, flood protection and many recreational 
opportunities.
    The McClellan-Kerr-Arkansas River Nation System is 445 
miles long and spans Arkansas and the eastern part of Oklahoma. 
Between the Port of Muskogee and Tulsa Port of Catoosa, 
Oklahoma ports are home to over 70 companies and industries 
shipping 5.7 million tons of cargo with values of $22.56 
billion, employing more than 6,500 Oklahomans and creating an 
overall economic impact of more than $400 million to my State 
each year.
    The ability to move all kinds of goods without relying 
solely on one form of transportation keeps shipping costs low, 
benefiting companies that ship their wares regionally and 
globally, and benefiting consumers who can further stretch 
their dollars.
    In addition to moving products and manufactured goods, 
other Army Corps projects help our communities by providing for 
flood risk management, water storage, hydropower and 
recreation.
    Every authorized use of a Corps project allows the 
surrounding communities to realize a greater potential for 
economic development and improves the quality of life for those 
who depend on the infrastructure either directly or indirectly.
    The challenge before us today is to understand the full 
need for repairing and maintaining our current infrastructure 
and the need for new projects to ensure that the United States 
remains globally competitive and our communities continue to 
reap the benefits of the Army Corps infrastructure.
    With the top of infrastructure in the news during the 
election cycle and within the new Administration, the time is 
now to work toward solutions to meeting these needs.
    I thank our witnesses for being here today.
    I want to make one comment about the attendance here. This 
is taking place at the same time we are having a Senate Armed 
Services Committee hearing of which I am the Ranking Member, so 
it is difficult to be in two places at once. We will be going 
back and forth.
    Senator Cardin.

          OPENING STATEMENT OF HON. BENJAMIN CARDIN, 
            U.S. SENATOR FROM THE STATE OF MARYLAND

    Senator Cardin. First, Mr. Chairman, let me say what a 
pleasure it is to be sitting next to you in this committee as 
we convene the first public hearing of our subcommittee.
    Senator Inhofe and I came to the U.S. Congress on the same 
day in the House of Representatives. We have been friends ever 
since. It is a real pleasure to serve with him on this 
subcommittee because, I am going to let you in on a secret, 
Senator Inhofe is one of the most progressive people I know in 
this Country on infrastructure development.
    Senator Inhofe. I am glad you qualified that.
    Senator Cardin. I always told him I would be glad to come 
to his State to campaign for him but he told he would prefer me 
to stay in Maryland.
    The two of us share a passion for the importance of water 
infrastructure, roads and bridges, and transit systems for the 
entire modernization of our infrastructure because both of us 
understand it means jobs. It means U.S. competitiveness. It 
means America having the ability to compete globally. That is 
what it means. We recognize the importance of the governmental 
part, the private sector part and putting this all together.
    I particularly want to acknowledge my pleasure to serve as 
the Ranking Member with Senator Inhofe on this subcommittee. I 
think it is very appropriate that our first hearing deals with 
the role of public-private sector and water resources because 
we need both.
    You heard Senator Inhofe brag a little bit about his State 
on water projects. Well, I could spend the next 2 hours talking 
about the State of Maryland. I am not going to do that but I am 
going to compliment again Secretary Rahn for the leadership we 
have in our Maryland port.
    I had a briefing on the Maryland port last week. We are 
doing extremely well. For January 2017, the Port of Baltimore 
hit another record month. We are the closest to the Midwest and 
any other East Coast port which gives Maryland an advantage. We 
rank ninth overall in value of cargo. Baltimore is well known 
for the cars that come in and out of that port as the largest 
in that region. We are significantly increasing our capacity on 
containers, we handle a great deal.
    One of the facts I have to put in the record and brag about 
is the General Commerce ranked the Port of Baltimore as No. 1 
in the Nation for container berth productivity for 3 years in a 
row, with the port averaging 71 container movements each hour 
per berth. We are pretty efficient and are proud of our 
efficiency in the Port of Baltimore.
    Under our State leadership, we moved quickly recognizing 
that the expansion of the Panama Canal would allow larger 
vessels to be able to be handled. We had to add the facilities 
to the Port of Baltimore in order to be able to deal with that. 
Baltimore is one of only four eastern U.S. ports with a 50-foot 
channel and a 50-foot container berth allowing it to 
accommodate some of the largest container ships in the world.
    On July 19, 2016, the Ever Lambent cargo carrier from 
Taiwan was the first super-sized container ship to reach 
Baltimore through the Panama Canal, so we are ready. It is 
critically important to our economy.
    I have some numbers. This will be typical of just about 
every port in our Country. The business from the port generates 
13,000-plus direct jobs, with more than 127 jobs in total in 
Maryland linked to the port activities. This is very important 
to our economy. Three billion dollars in wages and salaries 
contribute more than $310 million to State and local tax 
revenues.
    This is important business for a Senator from Maryland. It 
is important business for a Senator from every one of our 
States. That is why we are particularly pleased to have this 
hearing.
    I do want to point out that we cannot do this just by one 
of the stakeholders alone. We appreciate the role the Federal 
Government plays. It is very important, the direct help of 
water resources. We will talk today a bit about the next 
important leg in Maryland which is Mid Bay on the dredging 
materials and reclaiming of lands.
    My predecessor, Senator Sarbanes, was directly responsible 
for Poplar Island, which has been a great success and a model 
for the Nation, allowing reclaiming of land as well as location 
for dredge material. We now need to move on to Mid Bay, which 
has already been studied. I think we are on track, but we will 
talk about it.
    We also need the roads, the bridges, the rail and also the 
private sector. This hearing is an attempt to try to understand 
that we need all the above. I hope, as a result of this hearing 
and further hearings we have, that we will be able to get the 
investments by the public and private sector so that American, 
indeed, be competitive in our port and water activities so we 
can get the job growth that the people of this Country need.
    [The prepared statement of Senator Cardin follows:]

    Senator Inhofe. Thank you, Senator Cardin.
    Let me say that we have worked so well together for so many 
years and we work on things that actually become productive. 
Confession is good for the soul, if you will pardon me for 
bragging a little bit.
    When we had been having our meeting with the Chairman on 
the Republican side every Tuesday at 12:15, when it comes to my 
turn, I always say, now, from the committee that actually does 
things because we did.
    I would say to my friend, Senator Cardin, we had the FAST 
Act, the Water Act, we had TSCA, the Chemical Act, three of the 
four largest projects or bills actually passed. We are used to 
accomplishing things.
    We have many, such as Senator Capito and I, who have other 
committees at the same time so, because we have five witnesses, 
we are going to try to get you to adhere, if you would, to the 
5-minute limit on your comments. Of course your entire 
statement will be made a part of the record.
    We will start with General Semonite.

 STATEMENT OF LIEUTENANT GENERAL TODD T. SEMONITE, COMMANDING 
  GENERAL AND CHIEF OF ENGINEERS, U.S. ARMY CORPS OF ENGINEERS

    General Semonite. General Inhofe, Ranking Member Cardin and 
distinguished members of the subcommittee, I am Lieutenant 
General Todd T. Semonite, Commanding General of the U.S. Army 
Corps of Engineers and the 54th Chief of Engineers.
    I am pleased to be here today to discuss the role of the 
United States Army Corps of Engineers Civil Works Program and 
the associated value of water resource investments across the 
Nation.
    The Corps has played a significant a significant role in 
the development of the Nation's water resources and currently 
manages an extensive national water resource infrastructure 
portfolio. This includes maintenance of 13,000 miles of coastal 
navigation channels, 12,000 miles of inland waterways, 715 
dams, 241 locks, 14,000 miles of levees and hydropower plants 
at 75 locations.
    These projects help provide risk reduction from flooding in 
our river valleys and along our coasts, facilitate the movement 
of approximately 2 billion tons of waterborne commerce and 
provide up to 24 percent of the Nation's hydropower.
    There are about 250 million recreational visits a year to 
Corps lands and reservoirs, making the Corps one of the top 
Federal recreation providers.
    Corps water resource investments bring significant value to 
the Nation. For example, the United States maritime and 
transportation industry supports approximately $2 trillion in 
commerce with over 2 billion tons of commerce moving through 
harbors, channels and waterways constructed and maintained by 
the Corps.
    Approximately 98 percent of the United States overseas 
trade by weight and 99 percent by volume enters or leaves the 
United States through a U.S. coastal port. The inland waterways 
support this commerce by facilitating the export of 
approximately 60 percent of U.S. grain, 22 percent of coal and 
22 percent of petroleum products.
    Corps risk reduction management projects and activities 
provide resilient risk reduction infrastructure and prepare 
individuals and communities for potential floods. The Corps is 
responsible for the construction and operation of 383 major dam 
and reservoir projects that regulate floodwaters in the 
Nation's major rivers and tributaries and has constructed over 
14,700 miles of levees in partnership with local, non-Federal 
partners.
    Additionally, the Corps has constructed over 90 major 
coastal shoreline protection projects along 240 miles of the 
Nation's coastline that provides storm damage reduction 
benefits to vulnerable coastal communities.
    Over the past 10 years, it is estimated, on average, the 
Corps risk management reduction projects have prevented over 
$65 billion worth of flood damages to urban and rural 
communities across the Nation.
    The Corps maintains recreation facilities at over 400 of 
its multipurpose projects. The Corps has a long history of 
developing partnership within existing recreation authorities. 
It leases about half of the 5,000 recreationsites at these 
multipurpose projects to the public and private entities, 
including private sector commercial operators, States and local 
governments.
    Private recreationsites include approximately 562 privately 
owned marinas, resorts, campgrounds, boat ramps, fuel docks, 
convenience stores and other public use areas.
    The Corps constructed much of this infrastructure in the 
first half of the twentieth century. Some of it is experiencing 
various stages of degradation and disrepair. In fact, 
approximately half of the Corps lock and dam facilities are 
more than 50 years old and bring operations and maintenance 
challenges commensurate with their age.
    The Corps dedicates a significant amount of its resources 
to maintain the key features of these locks and dams, 
hydropower facilities and other water resources infrastructure. 
Per these requirements, a significant portion of the Civil 
Works Program is devoted to maintaining these systems so they 
can continue to provide economic and environmental benefits to 
the Nation and to address significant risk to safety.
    To support the current and future requirements of the 
Nation's water resource infrastructure, the Corps is exploring 
alternative financing and funding options, including public-
private partnerships, also referred to as P-3s through an 
assessment of private policy requirements and application of 
project-specific experience. The Corps is seeking to 
demonstrate how collaboration between the public and private 
sectors may improve the Corps' ability to deliver the Nation's 
infrastructure needs.
    The Corps recognizes that significant investments are 
required to sustain the performance of our water infrastructure 
portfolio to an acceptable level of risk. We greatly appreciate 
the support from the Congress in addressing these needs.
    As required in WRDA 2014, the Corps provided a report to 
Congress in the spring of 2016 capturing lessons learned from 
the exploration of P-3 concepts to date. As part of that 
journey, and with the support of Congress, the Corps was able 
to start Fargo-Moorehead Risk Management Project in North 
Dakota.
    We acknowledge the congressional direction in the recent 
Fiscal Year 2017 appropriation language regarding the need for 
a more robust P-3 policy and look forward to working with 
Congress and the Administration to develop this policy 
guidance.
    Investments by the Civil Works Program reduces the risk of 
flood impacts in communities throughout the Nation, facilitates 
commercial navigation, restores and protects significant 
ecosystems, generates low cost renewable hydropower and 
supports American jobs.
    Continued investment in critical civil works infrastructure 
projects is an investment in the Nation's economy, security, 
employment and quality of life, now and into the future.
    Thank you for the privilege of testifying about the Corps' 
role in sustaining the Nation's water resource infrastructure 
and economic opportunities associated with our Civil Works 
Program.
    I am happy to answer any questions you may have.
    [The prepared statement of General Semonite follows:]
    
    
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    Senator Inhofe. Very good. Thank you, General.
    Director Lyons.

 STATEMENT OF JAMES K. LYONS, DIRECTOR/CEO, ALABAMA STATE PORT 
                           AUTHORITY

    Mr. Lyons. Thank you, Mr. Chairman, Ranking Member Cardin, 
and distinguished members of the subcommittee.
    My organization, the Alabama State Port Authority, is the 
non-Federal sponsor at the Port of Mobile which as Senator 
Shelby mentioned, is the tenth largest U.S. seaport by total 
trade.
    The committee understands that 80 percent of global 
consumption occurs outside our borders and ships carrying our 
commerce are getting much larger than our deepwater seaports 
can handle. At Mobile, Post-Panamax or wide-bodied tankers are 
already servicing our terminals, albeit inefficiently.
    Despite our constraints, we have attracted manufacturing 
and retail distribution investments, including Wal-Mart's newly 
announced 2.6 million square foot international distribution 
center which is presently under construction.
    Growth is unsustainable at our current channel depth and 
width. My organization has invested over $850 million in 
facilities and Federal channel infrastructure. Two of our 
investments in the private petroleum terminals recently 
reported double digit cargo growth.
    Mobile's public and private terminals generate about $23.5 
billion in economic value and employ over 154,000 people. On 
the larger scale, the U.S. seaports generate $4.6 trillion in 
economic value.
    U.S seaports will invest $154.8 billion and create 1.6 
million jobs by 2020 and 82 percent of that investment will 
occur in the U.S. gulf. Ports are doing their part to grow the 
economy and we provide significant return on Federal 
investment.
    The time has now come for both the Administration and 
Congress to give equal weight to seaports when grappling with 
infrastructure investments. Under-investment and under-funding 
the Corps' Civil Works Program results in inefficient, poorly 
maintained harbors, thereby increasing shipper costs, reducing 
our global competitiveness, aggravating the maintenance, 
dredging backlog, adversely impacting our tax base and job 
market.
    We must endeavor to revise law and reform procedures to 
better plan, fund, implement and maintain waterway 
infrastructure necessary for U.S. commerce. I will respectfully 
a few suggestions to achieve these goals.
    One is continue biennial review of the Water Resources 
Development Act to further timely reforms. Also, the Corps 
should submit annually to Congress a comprehensive report on 
its Civil Works Program to provide line item insight to program 
progression and costs.
    Two is the Corps should implement a strategic 5 year budget 
cycle. Today, the Corps works on 2 year budgets that fail to 
capture any project's full capital need through implementation.
    For example, the Corps' budget will only address two of the 
three-plus years of an authorized study and provides no 
guarantees for project engineering and design or construction 
phase funding. Once authorized projects are in the pipeline, 
they should be budgeted and secure funds through to completion.
    Three is to provide full allocation of the Harbor 
Maintenance Trust Fund available funds to guarantee year-in and 
year-out maintenance obligations. Five year budgeting cycles 
could provide Congress with specifics on long range maintenance 
funding obligations while providing new insights into newly 
authorized project maintenance.
    Fourth is to streamline the 3-3-3 Rule waiver process. 
Complex studies require necessary science to comply with NEPA. 
Much of that science takes a year or more to complete. Corps 
guidance requires that waivers be held until its tentatively 
selected plan is completed, adding up to a year to the project. 
Streamline the process and delegate the waiver decision 
authority to the division commander.
    Five is to reduce or eliminate the external peer review so 
the Corps has qualified professionals capable of sound 
engineering and program delivery. Many external experts do not 
understand Corps processes or mandates. The Corps focuses on 
educating consultants on the why rather than sound engineering 
further delaying implementation.
    We agree we must modernize our ports and it will cost 
billions of dollars. As deepened and widened channels come 
online, there will be additional demands on the Harbor 
Maintenance Trust Fund.
    We achieve significant gains in asset management through 
risk-based analysis and performance-based budgeting but we need 
to take a longer view toward budgeting and identifying program 
savings by reducing bureaucracy.
    The Alabama State Port Authority thanks this committee for 
its leadership and recognizing the nexus between water 
resources and economic prosperity. I appreciate this 
opportunity and am happy to address any questions.
    [The prepared statement of Mr. Lyons follows:]
    
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    
    Senator Inhofe. Thank you, Director Lyons.
    Mr. Humphreys.

 STATEMENT OF GRANT HUMPHREYS, TOWN FOUNDER, CARLTON LANDING, 
                            OKLAHOMA

    Mr. Humphreys. Chairman Inhofe, Ranking Member Cardin and 
distinguished members of the committee, it is a pleasure to be 
here today.
    As a third generation real eState investor and developer 
from Oklahoma, we the pleasure of creating places that foster 
community and allow folks to live healthy and rewarding lives.
    Our family has had a long history on Lake Eufaula. We have 
been there for over 45 years now.
    Ten years ago, we began a journey of creating a new town on 
the shores of Lake Eufaula in southeast Oklahoma. We call the 
place Carlton Landing. The site we chose was a 1,900-acre site 
that was on the same cove where I learned to water ski as a 
boy. The land is connected to 10 miles of shoreline that is 
either owned or controlled by the Corps of Engineers.
    It is our desire that Carlton Landing would be seen as a 
model for good development, the kind that conserves our natural 
assets, that provides a boost to rural economies and creates 
great places for people to live, work, create and play.
    Before I share a story, I want to say a few words about the 
Corps staff. We have worked closely with the Corps staff since 
2007 and have built a good rapport. To their credit, we found 
them to be accessible, responsive, capable and committed. I 
have great respect for their authority and the critical nature 
of their mission.
    Here is our story. In 2008, we put together a master plan 
for Carlton Landing which included 3,000 homes, a town center, 
shops, restaurants, schools, churches, parks and trails. The 
vision was to create a complete lakefront community. Since the 
Corps controlled all access to the lake, from the beginning we 
understood that our ability to implement that vision would be 
absolutely dependent on our ability to work with the Corps.
    We requested a minor zoning change that would allow us to 
have walking trails to access the lake, must a four foot-wide, 
gravel chip trail. It was suggested that we partner with a 
conservation group, so we partnered with the Nature 
Conservancy. Then it was suggested that we might have a 
smoother track to get approval if we were a public entity, so 
we went through the process of actually taking our master plan 
community and incorporating it into a public municipality.
    Over a 3-year timeframe, through all these steps, the 
Corps' response to our rezoning request was professional, 
courteous but it was always the answer ``no.''
    Title 36 specifically empowers the District Commander to 
use discretion in making minor changes to a shoreline 
management plan. We discovered that due to the fact that the 
Eufaula EIS and not been updated since 1977, the previous 
District Commander at the Tulsa District Office had made 
promises to Federal environmental agencies that absolutely no 
changes would be made until a new EIS was completed. EIS's take 
funding and Congress had deferred that funding for several 
sessions.
    We were also informed that private money could not be 
accepted. The lake was in a zoning gridlock and the local Corps 
staff's hands were tied.
    By the summer of 2010, it appeared that our vision for 
Carlton Landing was dead in the water. In March 2011, Senator 
Inhofe met directly with the Tulsa District Commander. Within 
days, we saw a new tone. Forward motion was realized and the 
Corps staff was now on a new mission to update the Eufaula EIS.
    By April 2013, the EIS was completed and a new shoreline 
management plan was created. The rezoning action that we needed 
was complete.
    By 2015, the Town of Carlton Landing had completed a long 
term lease of 420 acres of Federal lands from the Corps. Today, 
we are working on dozens of projects still with the Corps 
office trying to bring that vision to fruition.
    Ultimately, it took us 8 years to obtain Corps permission 
to install a community boat dock with a gangway attached to our 
own land, 8 years. Somehow, despite the regulatory roadblock, 
we were able to start and create a lake town even though we did 
not have lake access.
    While it is true we have had success with the Corps, the 
journey to get here has been anything but easy. Unfortunately, 
our success came only after direct, top-down political pressure 
from the highest levels in Washington.
    Without a forceful hand of political involvement to 
unfreeze the process and create a door of opportunity, I 
believe our efforts would continue to bear no fruit. In our 
case, the staff was well intended but their hands were tied by 
past commitments and regulatory gridlock.
    It is unclear how many Corps projects are affected by the 
same structural barriers that have been established over time 
but issues such as the petrified EIS or a frozen shoreline 
management plan are a deal killer for a private developer.
    This should not be the case because it limits success only 
to those with political connections, deep pockets and the 
ability to wade through unrealistic timelines. Every private 
sector developer project, Carlton Landing included, is 
absolutely dependent upon obtaining assurances of entitlements 
within a reasonable timeframe.
    In preparation for today's hearing, I received good 
feedback from several developers from across the Country. Some 
have had a positive experience with the Corps, but several have 
had a very troubling experience. Some had experiences so 
difficult that they had to walk away from the deal resulting in 
significant financial loss. I think that is more the norm than 
the exception.
    I appreciate General Semonite's no-nonsense approach to 
accomplishing his mission. I believe he is the kind of leader 
that the Corps needs to turn around the ship and create a 
culture of action that brings about the desired outcomes.
    I also appreciate the legislative work of the Water 
Resources Development Act. It gives clear direction and aims at 
the right targets.
    In closing, there is a strong market for careful, smart, 
sustainable development on our Nation's lakes, rivers and 
waterways. The Corps is in a position to either encourage or 
hinder economic growth at the local level.
    If we are serious about attracting private investment in 
and around our natural resources in a way that protects our 
natural assets while also maximizing their value, I believe it 
is necessary to set the table for developers and create a 
better process to clearly define the Corps' regulatory 
landscape in a way that works for the private sector.
    Thank you.
    [The prepared statement of Mr. Humphreys follows:]
    
    
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    Senator Inhofe. Thank you, Mr. Humphreys.
    Secretary Rahn.

STATEMENT OF PETE K. RAHN, MARYLAND SECRETARY OF TRANSPORTATION

    Mr. Rahn. Good afternoon, Mr. Chairman, Ranking Member 
Cardin and members of the subcommittee. Thank you for inviting 
me to discuss the roles of the public and private sectors for 
our ports.
    Ports are the key links in U.S. access to the global 
transportation network and Federal navigation channels provide 
access to these facilities. I thank the Committee for 
continuing to support maritime infrastructure and commerce, 
especially with respect to essential dredging projects that 
keep our shipping channels, our maritime highways, safe and 
open for business. This is a high priority for the Hogan 
Administration.
    The Helen Delich Bentley Port of Baltimore is an economic 
engine, not just for Maryland and the region, but for our 
Nation. As Senator Cardin mentioned in his opening remarks, it 
generates approximately 13,650 direct jobs and about 128,000 
total jobs linked to port activities. It is noteworthy that the 
average income for the port direct job is 16 percent higher 
than the average Maryland salary.
    Our public-private partnership agreement with Ports America 
Chesapeake and the availability of a 50-foot deep container 
berth has positioned the Port of Baltimore to attract cargo 
growth associated with last year's Panama Canal expansion. Our 
tonnage increased 9.3 percent in the first 8 months since the 
Canal opened. The port's coal business also increased 
significantly over the same period, as these ships need deep 
water too.
    The U.S. Army Corps of Engineers has been very responsive 
to our port, to our shippers, carriers and congressional 
concerns about the planning process for channel improvements 
and has initiated reforms that were included WRRDA 2014.
    Because of these planning reforms, WRRDA 2014 and WRDA 2016 
authorized nine major port projects that provide for channel 
improvements to accommodate the new generation of larger and 
much more economically efficient ships and capitalize on the 
opening of the improved Panama Canal.
    This inventory of new projects, along with several ongoing 
efforts that predate WRRDA 2014, produced an inventory of 11 
projects with a total cost in excess of $4 billion and a 
Federal cost in excess of $2.5 billion. Out of the 11 projects 
to date, only two received Federal funding and a third project 
was completed by a port that simply could not wait for Federal 
funding.
    The average appropriation over the last 8 years for coastal 
navigation construction has been about $170 million per year. 
While this represents an increase over the Administration's 
budget request for those years, it requires about 15 years to 
clear the existing inventory.
    In the highly competitive world economy, the low level of 
Federal funding to construct navigation channel improvements is 
holding back America and is simply unacceptable.
    It is not only navigation projects that are at issue. Like 
most ports, it is critical that the Port of Baltimore deliver 
sufficient, long-term dredged material placement capacity to 
support maintenance of its 50-foot deep channel in terms of 
both depth and width to capitalize on that anticipated growth 
and maintain our existing business.
    The Mid-Chesapeake Bay Island project, authorized in WRRDA 
2014, will use dredged material from the port's navigation 
channels to restore the James and Barren Islands and recreate a 
critical environmental resource in the Middle Chesapeake Bay.
    Like all WRRDA 2014 projects, this project faces 
deauthorization in calendar year 2021 if it does not receive 
Federal funds for construction by that time. The Mid-Chesapeake 
Bay Island Project is critical because it will provide 45-plus 
years of dredged material placement capacity.
    Federal funding is essential to enable opening the Mid-Bay 
Project by the time it is needed and to avoid deauthorization. 
I thank the Chairman and Ranking Member for their support of 
the Mid-Bay Project in WRRDA 2014 and respectfully ask the 
subcommittee to support report language in the next Water 
Resources Development Act to ensure continued authorization for 
the Project.
    Additionally, Federal funding for Corps dredging has been 
constrained over the last several years and continued 
constraints in funding will negatively impact the port. With 
larger ships calling today, it is imperative that Baltimore's 
harbor and channels be maintained at fully authorized depths 
and widths on a year-round basis to facilitate efficient and 
safe maritime commerce.
    Maryland remains fully committed to working with our 
Federal partners and the private sector to deliver safe, 
efficient and cost effective maritime commerce infrastructure 
in Maryland that contributes to the 26 percent of U.S. GDP and 
23 million American jobs attributable to all ports.
    Thank you again for the opportunity to testify and I would 
be happy to answer any questions.
    [The prepared statement of Mr. Rahn follows:]
    
    
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    Senator Inhofe. Thank you, Secretary Rahn.
    Commissioner Goche.

     STATEMENT OF RICK GOCHE, COMMISSIONER, PORT OF BANDON

    Mr. Goche. Thank you, Chairman Inhofe, Ranking Member 
Cardin and the rest of the members. I appreciate the 
opportunity to speak here for small ports in the Pacific 
Northwest, Oregon and across the Country.
    I come from a little town called Bandon, Oregon with a 
population of little over 3,000. I have been a commercial 
fisherman most of my life. Now, I fish primarily for albacore 
tuna.
    My brother and I, when we get ready to go fishing, we 
supply our boat with enough provisions to be at sea for about 2 
weeks at a time. We spend most of that time between 100 and 200 
miles offshore.
    Because our boats are relatively small and relatively slow, 
when weather is forecasted that is beyond our means to deal 
with, we have to go into whatever port is closest to us. When 
the forecast is even worse, we have to sometimes just downwind 
and take whatever is on that trajectory.
    This is where the term ``safe harbor'' comes from because 
when weather is bad, any harbor is better than being at sea. 
From a fisherman's perspective, every port, whether large or 
small, is important.
    We have preferences though. The main reason that we have 
preferences is because of bars. I understand some here may not 
be familiar with the term ``crossing a bar,'' but in the 
Pacific Northwest, understanding that term can be a matter of 
life or death.
    The bar is a term used for where a hump is formed in the 
entrance to the harbor from the downstream sediment that drops 
when it comes up against the swells and tides of the ocean. 
During ebb tides, the river water speeds up and narrows at that 
hump and creates the pressure against the incoming swells. 
Those swells build and steepen and tip over and become 
breakers. That is where the term ``breaking bar'' comes from.
    I did not understand until I started coming back and 
talking with people here that breaking bars are pretty much a 
unique condition relative to the rest of the coast. In the 
Pacific Northwest, every bar is a breaking bar at one time or 
another.
    I could not really understand until I figured out that 
while these small ports budgets' were zeroed out year after 
year, budget after budget, Administration after Administration, 
now I know. So I want to help you understand how important bar 
dredging is in the Pacific Northwest.
    There are a couple of ways to minimize the threat of a 
breaking bar. One is to build jetties that steer the current of 
the river a few degrees off the dominant swell. That has been 
done many, many decades ago all over the Pacific Northwest. 
Because of lack of funding, most of those jetties are in 
disrepair and are becoming more and more dangerous and less and 
less effective.
    Another way to minimize the deadliness of breaking bars is 
to dredge that hump to which I referred. Every year, sediment 
coming downstream comes up against the swell where the river 
broadens out, and drops that sediment caused by the heavy rains 
typical and characterize the Pacific Northwest coast.
    There is one thing that both methods have in common. That 
is funding. The Portland District of the Army Corps of 
Engineers does a great job dredging our navigation channels and 
taking care of things, given the resources.
    When insufficient funding is provided, as is often the case 
for small ports, the bar shallows and breaks and lives are 
lost. The reason lives are lost is because when those breakers 
are happening, a boat transiting that breaking bar comes up 
against a freak wave or a sneaker wave that is bigger and 
faster than the rest of the waves, then the boat basically 
turns into a surfboard, loses control and literally rolls over. 
Many deaths happen because of this.
    In Oregon, there are 15 communities with small ports. In 
every one of those communities the port is the equivalent of an 
anchor business. Everyone sitting at this table understands 
that. The Port of Bandon in 2014 commissioned a study that 
found that $62 million of economic benefit is generated 
annually as a result of our access to sea that is maintained by 
the port dredging.
    Operation and maintenance of our Nation's navigation 
infrastructure is a Federal responsibility. However, chronic 
underfunding for ports large and small is causing our water 
infrastructure to deteriorate impacting safety and reducing 
America's competitiveness.
    I have been encouraged by the recent efforts in Congress to 
ensure that all the moneys paid into the Harbor Maintenance 
Trust Fund every year is used to fund the Corps of Engineers. 
However, we, from small ports, are concerned that this will not 
happen quickly enough. Many of our Nation's ports may have long 
since silted in by the time that money is made available.
    Again, I appreciate this opportunity to speak with you. I 
know it might be hard to understand but if everything you have 
is wrapped up in your boat and your boat feeds your family, you 
go fishing.
    Even when everything is optimal, some of us do not make it 
home. I am just here to ask you to give us the best chance you 
can that we can make it in and home to our families.
    [The prepared statement of Mr. Goche follows:]
    
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    Senator Inhofe. Thank you, Mr. Goche. That was very 
informational.
    We are going to have 5 minutes of asking questions. If 
there is a desire for a second round, we can do that.
    Let me start with General Semonite. You have been before 
this committee several times. We have been listening to the 
President not just in the Administration now but when he was 
campaigning talking about a very ambitious infrastructure 
program.
    I would like to ask have you had conversations either with 
the President or with members of the Administration concerning 
any of the details of what the plans are from his perspective?
    General Semonite. Yes, sir. I think, first of all, the most 
important thing of those discussions has been a theme all of 
you have already said. That is that many Americans think of 
infrastructure as roads, airfields, and bridges. We need to 
continue to expand that dialog to talk about coastal ports and 
inland waterways.
    We have had several questions from the Administration to my 
staff asking specifically what are some things are significant 
challenges you are faced with on budgetary issues and where 
could there be some of those projects that would be well served 
by additional infrastructure funding.
    The other thing, I think, is the Administration is very 
interested in the potential for private-public partnerships. We 
have been asked a lot of questions about what would be some of 
the studies or cases of how you could see where a public-
private partnership could take off some of the burden to the 
taxpayers.
    The third area in which we have been asked questions is are 
there some things when it comes to processes or procedures 
where we can un-encumber you and allow you to continue to do 
your job perhaps in a manner that might be a bit more efficient 
and effective.
    Working through the Assistant Secretary of the Army for 
Civil Works, we have provided answers to some of those 
questions. We do not know any outputs right now. We have mainly 
been in a provide mode. We do not know exactly where that is 
going to end up.
    Senator Inhofe. I think it is important that the public 
knows these conversations are taking place. I have had a few 
conversations. Also I know that this committee is going to be a 
very busy committee.
    You might remember in one of your earlier appearances in 
reference to the Tulsa District, we had that rather unpleasant 
experience with a senior employee's statement from the Corps of 
Engineers. The statement was made ``If it were up to me, there 
would be no lake development.'' I want you to get in the record 
right now your response to that statement.
    General Semonite. I think I will say the same thing I said 
last month. The Corps of Engineers certainly sees a very active 
role for private-public partnerships. With respect to our 
recreation facilities and some of those numbers I gave you, we 
would continue to endorse those.
    If there was a member of my staff who felt that is not 
appropriate, then that is on me and I will fix that. I do think 
it is important to clarify though that there are some very 
specific examples where the appropriate procedures by the 
private vendor were not followed. As a result, based on our 
procedures, we had to request the right information, for 
instance, design, permitting, that kind of stuff. There could 
be some frustration with very specific cases that come up.
    Senator Inhofe. That statement does not fit those 
circumstances, however.
    Speaking of that, Mr. Humphreys, in your testimony, you 
talk about the difficulty in navigating the various permitting 
processes with the Corps of Engineers. Are there any examples, 
other than what you used in your opening statement, you would 
like to share with us?
    Mr. Humphreys. Right now, we are going through a process on 
private land that extends into the lake. It is not part of the 
Corps' property but it is affected by a flowage easement, so 
the Corps has the right to flood our private property.
    We are trying to put a waterfront park into this area, 
doing some erosion control and a swim beach and a performance 
lawn. This is the front lawn of Carlton Landing, a place that 
we have been wanting to see built out from the beginning.
    We ran into an issue where the 602 line is the elevation 
where you can develop down to that land and not have to worry 
about flood risk. Below that, we did not realize that there is 
also a 585 line, which is the top of the conservation pool.
    We have been working on this project for several months and 
it had to go through the local office to get to the Tulsa 
office into the regulatory office before we understood that 
just the couple feet that we are wanting to do some impact and 
stabilization of the erosion control of the bank below 585 was 
going to bump us into a general permit adding on four to 6 
months to the process.
    That was something where had we known the lay of the land 
from a regulation standpoint at the very beginning of the 
process, it could have been avoided.
    Senator Inhofe. I think that is good. There is not time to 
give the examples that are out there but it is a bureaucratic 
problem. I think everyone up here knows that and everyone at 
the table down there knows that.
    While time is somewhat limited during the course of these 
questions, anything we can get from the witnesses for the 
record would be very helpful for us to have.
    Senator Cardin.
    Senator Cardin. I want to thank all of our witnesses. I 
found your testimony to be very helpful.
    General Semonite, I certainly support, in the appropriate 
manner, leveraging the best we can between public-private 
partnerships but I also acknowledge the tremendous return we 
get from the public investment. The multiplier effect is as 
high as 22 to 1 on economic benefits and 7 to 1 in revenues 
generated to the U.S. Treasury. It is a good investment.
    I want to get to the point that Secretary Rahn made. That 
is that because of the backlog of projects and the limited 
appropriated moneys, there are delays. Those delays could very 
well cause previously authorized projects not to be funded 
within the time restrictions and could jeopardize those 
projects being done at all.
    I take it what we are facing in Maryland is not untypical 
as to what is happening around the rest of the Country?
    General Semonite. Sir, that is right. I think, though, it 
is more important to be able to make sure we understand the 
national ramifications of some of these projects that do not 
get done, so I will talk about this particular one, Mid Bay 
Island.
    I was the Division Commander in New York and directly 
championed Mid Bay as we went through the civil works review 
process back in 2007 and 2008. There is great potential there.
    The challenge is that if we do not find a place to put 
dredge material, a strategic long-term plan, these harbors and 
ports will continue to have more and more challenges. Baltimore 
is going to run out of land for dredge material somewhere 
around 2027, based on current conditions. I could be off a year 
or two.
    The question is, if we do not find it on the shores of the 
land, and that is hard because land development, condominiums 
and everything else are taking the shores, if we do not do it 
inside the water when the sediment is OK to be able to dump 
inside the water or if we do not build islands like Mid Bay, we 
do not have any other options.
    All the benefits this committee has talked about in the 
economic piece, we have to find some solution to be able to 
solve these issues.
    Senator Cardin. I thank you for that. That is why Congress 
authorized Mid Bay in 2014 because we recognized the lead time 
was necessary. We still had capacity at Poplar Island, we still 
had other capacity for dredge material, but we knew if we did 
not start that ball rolling, we would run out of capacity.
    Mr. Chairman, I remember coming to Congress many years ago 
with battles on where you were going to be able to put dredge 
material. It was politically impossible to find a location in 
the Baltimore region to put dredge material.
    My predecessor, Senator Sarbanes, came up with Poplar 
Island and it became a win-win situation. It is now an 
environmental restoration project of returning wetlands and 
species to the Chesapeake and the location for a significant 
amount of dredge material but that is running near its 
capacity. We still have some time left and that is why Mid Bay.
    Secretary Rahn, can you tell me where we are in regard to 
Mid Bay and how important it is that stay on track from the 
point of view of being authorized for the Army Corps and 
funded?
    Mr. Rahn. Absolutely, Senator. As far as Mid Bay, you have 
mentioned how important it is. The plan right now is that Mid 
Bay would be coming on as Poplar Island, which is incredibly 
popular with the public as this great facility people go to see 
wildlife and enjoy the area, we need another place to go and 
that has been designated as Mid Bay.
    The issue right now is that there had been a DMMP ordered 
by the Corps to study placement of dredge materials. That has 
been going on now I believe since 2011. It should be completed 
hopefully sometime this summer.
    At that point, once we have an approved plan, then it has 
to go to headquarters for approval from the Corps of Engineers 
headquarters. Then it has to be funded. All of those things 
have to occur.
    Right now, we are fairly confident about approval of the 
DMMP plan. The critical pieces are approval from the Corps 
headquarters and then funding, funding, funding and we need to 
start with that and continue with that to make sure the Country 
continues to benefit from the productivity of the Baltimore 
Port.
    Senator Cardin. If it does not stay on schedule and it is 
not ready, we run of capacity, does that we jeopardize the 
ability to have the width and depth in our channels necessary 
for commercial activities?
    Mr. Rahn. It absolutely does. Right now, we are seeing the 
benefits over the last eight or 9 months given the large ships 
that are making their way into the port. We can see that 
continuing and expect it to grow. That cannot occur if the 
channel itself is filling both from depth and width.
    If we have a major storm that comes up the Bay, we will 
lose the capacity of the channel much sooner.
    Senator Cardin. Thank you, Mr. Chairman.
    Senator Inhofe. Senator Ernst.
    Senator Ernst. Thank you, Mr. Chairman.
    Thank you, gentlemen, for appearing here today. General 
Semonite, thank you very much. It is really good to see you 
again.
    Given the topic of today's hearing, I would like to 
continue the conversation we have been having regarding the 
Cedar Rapids Flood Risk Management Project. I would like to 
share with everyone here today, those on the committee, those 
of you on the panel and in the audience that the September 2016 
floods which impacted Cedar Rapids where the Cedar River 
crested at a level second to only the 2008, 500-year flood 
event, caused Cedar Rapids to lose $26 million in sales and 
production due to being essentially shut down for an entire 
week when they were evacuated due to the floods.
    As I mentioned to you before, the city of Cedar Rapids is 
our second largest city. Its success is critical to the entire 
economic well being of the State of Iowa. There are products 
Cedar Rapids produces and manufactures that have domestic and 
global impacts.
    For example, breakfast cereal manufacturers in Cedar Rapids 
produce 13 percent of total U.S. output. Industry in Cedar 
Rapids also processes as much as 19 percent of the global oat 
crop in value added manufacturing per year.
    Wet corn milling in Cedar Rapids accounts for 8 percent of 
U.S. domestic ethanol production. The quantity of corn 
processed each year in Cedar Rapids exceeds the size of the 
domestic corn crop of Canada, the Republic of South Africa or 
the Russian Federation. That is a lot of corn, folks.
    These are all products and goods that at some point or 
another rely on the Corps infrastructure to move.
    With that being said, I did notice a couple of provisions 
that I mentioned here earlier in the omnibus explanatory 
statement for the Corps that I think could apply to a community 
like Cedar Rapids.
    There seems to be new provisions in the Corps work plan 
that requires you to provide Congress with more descriptions of 
the rating systems used to evaluate projects and explain why 
certain projects were considered as being less competitive. I 
also saw the provision that said ``Administration budget matrix 
shall not be a reason to disqualify a study or project from 
being funded.'' We think that is a great step forward.
    Can I take this as a sign that the Corps and the 
Administration are looking to improve its system that 
calculates the economic benefits of flood control projects? 
Will you commit to continuing to work to make sure we are able 
to move the Cedar Rapids Flood Mitigation Project forward in 
Fiscal Year 2018?
    General Semonite. Senator, thank you for that question. You 
and I have talked several times on this. We are in awe of the 
people of Cedar Rapids who were very heroic back in that flood 
fighting. That is not a position that we should put Americans 
in, to have to be able to fight for their lives.
    On the other hand, this is a project which, unfortunately, 
does not rise high when it comes to the current method for 
racking and stacking projects with respect to the benefit cost 
ratio. We are committed to doing everything we can to continue 
to champion that project. The Corps will certainly do that. I 
do not know exactly how it will fall out in the rest of that 
process.
    Senator Ernst. We do have to continue pushing because as I 
went through all these different examples of what passes 
through Cedar Rapids on a daily basis, the impact to the 
economics of the State is pretty clear.
    When you are comparing the cost of the property in Iowa, it 
is much lower than the cost of a property on the coastline. Of 
course you have great big, beautiful, million dollar homes but 
that does not mean to a person living in Iowa that their home 
is worth any less to them. It is just based on what everyone 
else believes is the value of the home. We do have to consider 
that.
    As a reminder, the assistance that Cedar Rapids needs from 
the Corps is just 3 percent of the cost of damages that it went 
through in 2008. We need to continue pushing this issue. I look 
forward to more conversations with you in the future and a way 
forward for the people of Cedar Rapids.
    Thank you.
    Senator Inhofe. Thank you, Senator Ernst.
    Senator Merkley.
    Senator Merkley. Thank you, Mr. Chairman.
    I wanted to focus for a moment on the Harbor Maintenance 
Trust Fund. In 2016, the amount spent was 80 percent of the 
incoming receipts. In 2017, that fell to 55 percent of the 
receipts.
    My question is for you, General. If we had spent all of the 
receipts from 2017, do you have enough infrastructure projects, 
meritorious infrastructure projects for those funds?
    General Semonite. Senator, there is clearly a very long 
list of requirements. We definitely have most of the time, more 
requirements than funds available.
    Senator Merkley. The question I want to raise is these 
receipts that go into the Harbor Maintenance Trust Fund are 
from the industry itself, from the shipping. Given the State of 
our jetties, given the State of our dredging, given the State 
of our locks, shouldn't we spend every dollar that comes in on 
maintenance of our water infrastructure?
    General Semonite. Senator, I think obviously a lot of 
different considerations go into the use of the Harbor 
Maintenance Trust Fund. I would continue to say that we will 
champion full use of that where possible, but as far as exactly 
how that is expended, there are obviously a lot of players 
there.
    Senator Merkley. Thank you, General. It was appropriately 
diplomatically stated. I appreciate the point that yes, there 
are plenty of infrastructure projects that need to be worked 
on.
    Mr. Lyons, I believe you said in your testimony that under-
investment in seaport channels and harbors and under-funding 
the Corps' civil works program results in inefficient channels, 
poorly maintained harbors, increasing costs for port users, 
reducing U.S. global competitiveness, exacerbating maintenance, 
dredging backlog, all of which adversely impact the U.S. tax 
base and job market.
    Mr. Lyons, would you support using all of the Harbor 
Maintenance Trust Funds to actually sustain, maintain and 
improve the infrastructure?
    Mr. Lyons. Yes, Senator, I would. I believe, as the General 
said, there are plenty of projects out there. There are a lot 
of projects that are marginally maintained or not even 
maintained to their full authorized depths.
    We have especially big problems in the Great Lakes ports. 
Our harbor requires maintenance because we are fed by a river 
and river silt. Some years, we have much more material to move 
than in others and there are years that we are very marginally 
able to take care of it.
    Sometimes we have some delays where we have to experience a 
narrow channel where we have to go to one-way traffic because 
of the sides of the channel have filled up and they do not have 
sufficient funds to get to it. Yes, I would absolutely support 
that.
    Senator Merkley. Thank you.
    Mr. Goche, when you are looking at the ports on the Oregon 
coast and we skip a year of dredging, in some of these ports 
that have rivers feeding them and silt coming down the river, 
is even skipping a single year sometimes problematic for the 
commerce and the safety of that community?
    Mr. Goche. Absolutely, Senator. A case in point, on the 
Rogue River, they missed a year of dredging and it was a 
particularly wet year that year. Now it is going to cost way 
more than 2 years' worth of dredging to get that caught up 
because it is silted in so badly that now they cannot go in 
with a regular Corps dredge. They are going to have to farm out 
the job with a different kind of dredge that uses a pipe to 
even get the Corps dredge in.
    Senator Merkley. This is like an extra $800,000, I believe 
or something like that, just to get back to where you can do 
the normal project?
    Mr. Goche. Correct.
    Senator Merkley. Sometimes you have a situation where not 
only is it boats coming in, but also the ability of the Coast 
Guard to get out to do recue?
    Mr. Goche. Yes, and that is the case once again on the 
Rogue because I do not think they are even going to be able to 
get the Coast Guard to come in to help on this bad breaking bar 
because the Coast Guard does not have enough depth to transit 
it.
    Senator Merkley. You can easily find uses important to the 
economy and the safety of Oregon's coastal communities for 
spending some of the unspent Harbor Maintenance Trust Fund?
    Mr. Goche. You bet.
    Senator Merkley. Thank you so much for coming out from 
Oregon to share this perspective. I really do appreciate the 
small port set aside, the 10 percent set aside, that has been 
so important to Oregon's coastal economy. It is something we 
need to keep doing for all of our smaller ports around the 
Country.
    Senator Inhofe. Thank you, Senator Merkley.
    Senator Shelby.
    Senator Shelby. Thank you, Mr. Chairman.
    General Semonite, you had a lot of experience with the 
Corps before you got to your present position. We have been 
talking about the Panama Canal and its impact on shipping, its 
relevance to deeper ports in the Gulf, and so forth. Tell us 
how important the modernization of the Panama Canal is and what 
impact it will have or should have on all of our ports, 
especially the Gulf ports.
    General Semonite. Senator, I was there at the opening of 
the Panama Canal; I saw the first ship come through. I was 
amazed at the amount of volume that came through. As several of 
you have said, the economic impact on both the economy and the 
GDP, I think that is off the table on how much impact that will 
have.
    Senator Shelby. Would call it a game changer as far as 
shipping?
    General Semonite. I think it is a game changer, yes, sir.
    Senator Shelby. A game changer now and into the future.
    General Semonite. If you do not then have the ability to 
receive those, not every single port will take the big ships 
without a doubt, but if you do not have the second and third 
effect and be able to take the roll on down, then that will 
limit us, I think, in our ability to be able to continue to 
expand internationally.
    Senator Shelby. It will hurt our trade overall, will it 
not?
    General Semonite. It will certainly have an impact, sir.
    Senator Shelby. If a port is say 45 feet or 46 feet, 45 
feet, and some of the ships need 50 feet or close to it, if 
they cannot put a full load in there, it is not efficient, is 
it?
    General Semonite. Certainly not, Senator.
    Senator Shelby. It is like flying a freighter airplane and 
because of the runway or the distance and so forth, you cannot 
deal with it?
    General Semonite. That is correct.
    Senator Shelby. It is a game changer, is it not?
    General Semonite. It definitely is, and if a port is not of 
the right size, that means that particular part of the Country 
that cannot receive that boat or ship, industry is going to go 
where they can find the best investment.
    Senator Shelby. Mr. Lyons, the Port of Mobile, as I 
understand it, is 45 feet, is that right?
    Mr. Lyons. That is correct, it is 45 now.
    Senator Shelby. It has been authorized to go to 55 feet by 
law?
    Mr. Lyons. Yes. It was authorized in 1986 water bill.
    Senator Shelby. It also needs to be widened, is that right, 
where two ships can move and move around?
    Mr. Lyons. Yes. Our current channel is only 400 feet wide. 
When we have ships that exceed 140 foot beam, we are restricted 
to one-way traffic. As I mentioned in my remarks, we have a lot 
of wide-bodied tankers coming in that are 150 or 160 feet wide. 
We have post-Panamax container ships in, so we are one-way 
traffic there.
    Ships have to wait. Ships are expensive and that is costing 
money. That eventually affects the cost structure of these 
ships when they have to build in delays. They occur multiple 
times every week.
    Senator Shelby. You mentioned your container freight has 
gone up tremendously, has it not, your business?
    Mr. Lyons. Yes, Senator. We are a relatively new container 
port. We only opened our container terminal in 2008. Prior to 
that, we had been a bulk port and handled forest products, 
coal, steel and products like that.
    Manufacturing in the southeast has significantly changed. 
Retail distribution is beginning to realize they cannot be 
totally reliant upon the West and East Coasts to efficiently 
move at all times, so they are looking for alternate gateways.
    This is why Wal-Mart selected Mobile for this 2.6 million 
square foot international distribution center, one of six big 
ones that Wal-Mart has in the Country. There are alternate 
gateways where we have the bigger ships coming and it is 
important.
    Senator Shelby. A lot more container freight?
    Mr. Lyons. A lot more, our container terminal grew 19 
percent last year.
    Senator Shelby. I wish you had a big map to share with the 
committee and the people of where Mobile is located 
geographically, where the Panama Canal is and the proximity, as 
the crow flies. Going through the Panama Canal, you look right 
up the Gulf. You have a straight shot just about to the Port of 
Mobile, do you not?
    Mr. Lyons. It is a straight shot and we have grown. Like I 
said, we are an infant, if you will, container port but we now 
have three ships a week every week, a fixed day, that come 
through the Panama Canal. One of those shipping lines is going 
to the larger post-Panamax ships this year.
    Next year, the other two lines will go to post-Panamax. I 
feel confident that next year, we will add a fourth line coming 
from Asia. The Asian trade and Panama is very important to our 
port and our Country.
    Senator Shelby. General, since you know a lot about Panama 
and all the Corps and the ports, can you share with us your 
vision of where the Panama Canal is, where it comes through the 
Nation of Panama, and where it lines up as far as the Port of 
Mobile is concerned, as the crow flies, a direct line?
    General Semonite. Senator, there is clearly a proximity 
issue that Mobile has that some other places do not have the 
advantage of. Just so you know, that GRR you mentioned, we are 
right on schedule now to have that done by November 2019. We 
are putting about $8 million into that. We do not see any 
significant problems with getting that done.
    If the Congress decides to have that on priority, that will 
be well postured to be able to be deepened.
    Senator Shelby. A 50 to 55 foot channel or wider channel 
would be a game changer for the Port Mobile too, would it not?
    General Semonite. It would, sir. Again, the actual depth, 
we do not know that. That will be the result of the study so I 
will not commit on what the depth would be.
    Senator Shelby. We know. Thank you very much.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Shelby.
    Senator Duckworth.
    Senator Duckworth. Thank you, Mr. Chairman, for convening 
today's hearing.
    I want to thank our witnesses for participating in this 
very important conversation.
    General Semonite, as you know, our inland waterway system 
is a critically important component of our network, as we have 
been discussing and a barometer for gauging the health of the 
Midwest region's environmental and native species.
    The rivers surrounding and traversing Illinois provide 
enormous economic and recreational benefits. I believe Congress 
must prioritize the effective management and protection of 
these resources, the river system. Would you agree?
    General Semonite. Yes, Senator, I would.
    Senator Duckworth. As you know, the McCook Reservoir is 
approximately 91 percent complete. It prevents over $114 
million in annual damages to the Chicago land area and carries 
a benefit to cost ratio of 2.96, a very high score for an Army 
Corps project.
    Will you pledge that the Corps will work closely with my 
office, Senator Durbin and the Illinois delegation to complete 
the project on schedule, including Fiscal Year 2017 funding, so 
we can avoid the type of damages we have suffered over the last 
three disaster declarations?
    General Semonite. Senator, we seek great merit in this. 
This is a life safety issue. This is a flood risk management 
project. Clearly, the majority of that first half is all done 
and works very, very well. We will continue to champion that 
reservoir and whatever we can to get appropriate funding.
    Senator Duckworth. Thank you.
    I recognize there may be other agencies pressuring the 
Corps to abandon this critical project as it approaches the 
finish line. I just want to make it clear that it is 
unacceptable to leave my constituents at risk, especially when 
we are so close to finishing. Stage II of the reservoir started 
securing funding over 10 years ago and we are just asking to 
finish the job.
    General Semonite. Senator, we do not see any significant 
challenges with other agencies. We feel very firm that is a 
very smart project to finish.
    Senator Duckworth. That is wonderful. Good news. Thank you.
    General, when it comes to combating invasive species 
threatening the Great Lakes, Illinois may face the most 
daunting challenge in the need to effectively stop and control 
the Asian Carp without significantly disrupting inland waterway 
operations and harming our economy. It is a real balancing act.
    I believe we can achieve these two objectives. I was very 
interested in reviewing the findings of the Brandon Road Lock 
and Dam Study, along with the subsequent public comments and 
alternatives to inform our efforts to develop an effective 
solution.
    It is why I and many other Great Lakes stakeholders are 
deeply disappointed and surprised by the Army Corps' decision 
to indefinitely delay the release of this critical plan, a 
reversal with not much transparency or explanation.
    It was widely reported, in fact, that this decision was the 
result of outside pressure from the White House. Will you 
explain why the report was delayed and provide us with an 
updated timeline for its release?
    General Semonite. Senator, you know that report was 
completed by us, was prepared to go out for public comment. I 
do not know the details of the cause of our being put on hold 
for that report. We are hold until we are advised to go ahead 
and release that report. That is something where we are 
following guidance.
    Senator Duckworth. Where is that guidance coming from?
    General Semonite. All I know is it is coming from my higher 
headquarters which is the Assistant Secretary of the Army for 
Civil Works out of the Department of Army. I cannot elaborate 
as to where it would be above that. I just do not know.
    Senator Duckworth. OK. I need to reach out to the Assistant 
Secretary for the Army.
    General Semonite. I would think that would be the best 
answer, ma'am.
    Senator Duckworth. I do think it is very important to move 
this forward so we can have some sort of plan in place.
    Earlier this year, I joined several of my Great Lakes 
colleagues in both the House and Senate to highlight our 
concerns about the Corps' economic re-evaluation of the Soo 
Locks Project.
    Rather than calculating the transportation rate savings for 
this project based on traditional methods used by the Corps for 
other lock projects, it was our understanding that the Corps 
decided to use unique alternative modes of transportation never 
before used by the Corps on which to base its conclusions.
    I ask unanimous consent that the February 21 letter be 
entered in the record, Mr. Chairman.
    Senator Inhofe. Without objection.
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    Senator Duckworth. The February 21 letter asked the Corps 
to calculate the Soo Locks Project's economic benefits in a 
manner consistent with other Corps lock project evaluations. 
Will you commit to us today that the Corps will do that and you 
will finish the re-evaluation within the Corps' 2-year 
schedule?
    General Semonite. Senator, I do not know exactly the 
particulars of that one and I am not prepared to answer that 
today. Soo Locks is very important to this Nation. We see 
national security issues in there. It is an old lock. We have 
to get Soo Lock prepared.
    I do not know exactly the details you are talking about. I 
have to get back with you.
    Senator Duckworth. OK, we will follow with you on that. 
Thank you.
    I yield back, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Duckworth.
    Senator Sullivan.
    Senator Sullivan. Thank you, Mr. Chairman.
    I really appreciate the testimony today, gentlemen. It is 
very important.
    Commissioner Goche, as a Senator who represents thousands 
and thousands of fishermen and communities with small ports, I 
really appreciate your particularly compelling testimony.
    I want to shift the focus a little bit more north to where 
I am from. General, we have a lot of interest in the Arctic 
right now. I think a lot of people are waking up to that. As a 
matter of fact, the Arctic Council is having a ministerial in 
Fairbanks, Alaska starting tomorrow, 2 days in Alaska. All 
foreign ministers of the Arctic nations are going to be up 
there.
    You may have seen in the NDAA a requirement for the 
Secretary of Defense and the Secretary of Homeland Security to 
designate a strategic Arctic court given our increasing 
interest in the Arctic in shipping traffic, natural resources, 
search and rescue and protecting the environment. There is a 
lot going on up there.
    I want to talk to you about two ports. I know we are 
looking at all kinds of ports. First is the Port of Nome. As 
you probably know, the Corps has over a 100-year history in 
Nome, Alaska.
    There is a focus on the deepwater port draft study and 
there has been some back and forth after Shell left Alaska and 
the oil and gas exploration. There were two additional WRDA 
provisions just this past bill, the WIIN Act, that came into 
law in December. Those were actually designed to help get the 
Corps focused again on Nome.
    Can you commit to having Nome as part of your work plan 
moving forward again on the deep draft port study and work that 
was ongoing until we had the hiccup of some of those oil and 
gas issues?
    General Semonite. Senator Sullivan, thanks for the 
question.
    We are actively working Nome right now. The study was put 
on hold pending coordination with DOD and Homeland Security 
based on WRDA 16. The benefit cost ratio is below 1 percent. I 
think that is why there was a request.
    Senator Sullivan. But there are also provisions in the WRDA 
bill that essentially said, you have entire other areas to look 
at. Particularly, for example, in the law now, Nome services 54 
different communities throughout western Alaska and the Nome 
area. That gives you authority to kind of take a hard look?
    General Semonite. Yes, sir. We have sent out letters to 
both the Department of DoD, Navy and Homeland Security to be 
able to make sure that we understand where their potential use 
might be. We are waiting for those responses.
    I can certainly get with you offline and tell you what we 
hear from them to be able to see if, in fact, there is an 
additional reason from both of them to be able to expand the 
Port of Nome.
    Senator Sullivan. I would like to get offline with you 
because there are two specific provisions in the WRDA bill, 
just signed into law, that are very focused on that and are 
intended. I know we worked with your staff on the language to 
get the Corps moving again.
    If there are delays, I need to understand why there are 
delays when the law has been changed to actually get the Corps 
to move out on this issue.
    General Semonite. We are working implementation guidance to 
be able to see. I think the best thing is I come and see you, 
Senator, and I will lay this out. I am not exactly aware of the 
two extra provisions you are talking about right now.
    The information I have is that we are waiting for responses 
from the two departments as to what would be a strategic 
rationale to be able to have Nome not necessarily what you are 
talking about.
    Senator Sullivan. The NDAA is a different issue?
    General Semonite. Yes, sir. Let me come back and I will get 
with you. We will lay this out and walk our way through this.
    Senator Sullivan. Good. Thank you.
    Let me ask about another potential port in the area. What 
is the Corps' view of the effectiveness of possibly using 
public-private partnerships for the development of Port Spencer 
which is actually also in the area?
    General Semonite. Senator, I do not know on Spencer. We 
are, again, very interested in anything with a P-3. The 
challenge is, how do we put together the right package to be 
able to continue to make it through the system. If we get 
together, I will certainly lay out Spencer for you as well.
    Senator Sullivan. Great. Section 119 of the WIIN Act amends 
the law related to the territorial partial cost share waiver to 
add federally recognized Indian tribes as entities eligible for 
a limited waiver of local cost sharing for Army Corps studies 
and projects.
    Can you give me a sense of the Corps' timing on that new 
provision and how you are looking at it? The Alaska District 
has a lot of interest, as you know, on that provision. We would 
welcome your engagement.
    General Semonite. Senator, we support this as well. This is 
for a cost share of the first $450,000, mainly for Native 
American tribes. This is something we will do. We are writing 
through exactly what the implementation guidance is to be able 
to say here is how you would qualify for that.
    However, those tribes that do not have enough money to be 
able to come into a study, we do not think they should be 
disadvantaged. We support that, we just have to get the details 
together so we can put it on the street and people know how to 
apply for that.
    Senator Sullivan. Great. Thank you.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Sullivan.
    Senator Cardin and I would like to make a few more comments 
and maybe even have another round in case some members come who 
have not yet been here.
    First of all, General Semonite, one of the reasons that I 
brought this up and wanted to get it in the record in terms of 
the lake development is to make sure everyone understands this 
is legitimate. In fact, I remember the first one I think was in 
Oklahoma and Georgia immediately followed that. The Corps 
actually got into that business. That has been a long time ago.
    I wanted to mention another thing too that really has 
concerned me for so long. That is the Montgomery Lock and Dam. 
As you come down the Mississippi River, you are familiar with 
it and I am sure some of the others are not, you actually have 
two rivers. Well, it actually was called the Three River 
Project.
    If you take the distance from the Mississippi all the way 
across Arkansas and through Oklahoma, that is 445 miles that 
would be completely done away with and useless if we cannot 
ultimately find a solution to Montgomery. Are we waiting now 
for what they refer to as the Three River study?
    General Semonite. Senator, I am going to have to get back 
with you on that. There are several projects that we are 
looking to continue to champion, but I do not know exactly 
where we are on that particular one.
    Senator Inhofe. Senator Boozman and I do not need to take 
the time of the entire panel but we are very much interested in 
that. That has been a problem, Montgomery buoy to lock and dam 
and the depth issue, for a long, long time.
    Why don't we set up something and get the two of us 
together with you to see if we cannot come to some 
determination? Does that sound reasonable?
    General Semonite. It sounds great, sir.
    Senator Inhofe. Mr. Humphreys, in the opening statement, we 
talked about development like your development and what it 
means to surrounding communities, what it means to the economy, 
what benefits are there that people might not think about, 
because I know there are great benefits. Will you share your 
thoughts on that?
    Mr. Humphreys. I would be happy to.
    When we look at a project like Carlton Landing, we are in a 
rural area of Oklahoma that has seen economy shift to the urban 
areas. You have great natural beauty but you do not have a lot 
of drivers.
    First and foremost, we provide jobs in the construction 
industry. Construction activity alone will typically add about 
125 to 150 trades onsite in Carlton Landing, with the same 
number at any given time working offsite in sales, logistics 
and support.
    In terms of economic impact over the longer term, we expect 
to see over $2 billion of private investment in Carlton Landing 
as the master plan is built out. We expect Carlton Landing to 
be one of the more important economic development projects for 
Lake Eufaula, for southeast Oklahoma and also the growth of the 
Oklahoma tourism industry.
    I am happy to serve on our State's tourism commission. We 
think that long term, Carlton Landing could help bring dollars 
from outside Oklahoma, across State lines back into the 
Oklahoma tourism business.
    Since our project is a new community, it is not just a 
subdivision, we also enhance the quality of life of people who 
live in that area. We have the State's first rural charter 
school. About 80 percent of the kids attending our charter 
school in Carlton Landing come from outside of Carlton Landing, 
some driving as far as 30 minutes away.
    These are kids who, some come from strong families but some 
come from situations where their parents are incarcerated or 
they are in the foster care system. We are bringing them in and 
giving them a new opportunity to look and see life with new 
options. We are excited about that.
    All this together, we see development activity and 
community building as something that has tangible and 
intangible benefits, monetary and a lot of benefit to folks' 
quality of life that you just cannot put a number to.
    Senator Inhofe. Would you say a very similar situation in 
terms of benefits is true up there with your neighboring 
development up in Sky Tube that has really done some great 
things?
    Mr. Humphreys. You see the growth of the property values 
from the beginning of the public-private partnership to what 
they have realized currently. You have seen great growth where 
private investment is coming in.
    As I said in my earlier comments, we just need to set the 
table. There are some policy procedures that need to take place 
that help developers understand the regulatory landscape. I had 
an opportunity to speak with General Semonite. We will give our 
recommendations on things they can do with the existing 
regulations in educating and laying out a game plan so that 
people understand what the process looks like to work with the 
Corps.
    Senator Inhofe. You have a successful operation there. You 
have spread a lot of goodwill and helped a lot of people.
    Mr. Humphreys. Thank you, sir.
    Senator Inhofe. I notice we stalled just long enough to 
keep us open until Senator Markey got here. We will recognize 
him at this time.
    Senator Markey. Thank you, Mr. Chairman.
    I arrive, first, to praise Caesar. I thank you for the WRDA 
bill from 2014 because in that bill there was $216 million for 
the Boston Harbor deepening project so that we could 
accommodate the new super ships coming through the Panama 
Canal.
    I thank you for last year's WRDA bill because then we added 
another $16 million to deal with additional complicating, but 
necessary, features that had to be built in. We thank you for 
both of those. That is a perfect example of the way the 
committee operated under your leadership on all of those 
issues. There is no construction yet, though, because there is 
no actual money yet up there.
    General, can I get your commitment that you will work with 
us to try to telescope the timeframe that it is going to take 
in order for us to get the funding for that critically, 
essential project for Boston because without it, we are going 
to be a port that is not able to fully benefit from this 
change?
    General Semonite. Senator Markey, thanks for the question.
    I was the Division Commander in New York when we started 
that project back in 2007. There is a lot of value in that 
project.
    Clearly, the 2017 budget is on the street but the 2017 work 
plan is not. The 2018 budget will come out in a couple of weeks 
so it is premature for me to talk about where that is. Congress 
has given us new starts that we can allocate that. I think as 
soon as we see where that plays out in the next couple weeks, 
we will certainly be able to advise you on Boston Harbor.
    It is one of those projects that we certainly see merit in 
doing. The question is going to be where does it fall on the 
actual prioritized list of what is allocated money.
    Senator Markey. You know it well, though, that project?
    General Semonite. I know that project well, sir.
    Senator Markey. I think that is going to be very helpful 
going online so I thank you for that.
    Secretary Rahn, do we need more direct Federal spending to 
ensure America's ports can remain competitive in this new era?
    Mr. Rahn. The answer is obviously yes. We have to. We have 
neglected infrastructure across the board for decades. The 
answer is that yes, we have to invest more. Frankly, I am 
confused as to why we have not since infrastructure has always 
seemed to have been one of those things that both parties could 
agree to and that was always critical to our national well 
being.
    The answer is yes, we need additional Federal funds. Even 
just in Maryland, we have substantial needs that go well beyond 
the Mid Bay Project. As a Country that is so integrated into 
the global economy, we need all of these assets that allow us 
to link in.
    In Maryland, we are very much linked into that global 
economy. We have needs for the next phase of construction at 
our Poplar Island project; we have needs at our C&D Canal. 
There is so much there that we as a State do not have the 
capacity to address and frankly, require Federal investment to 
make that happen.
    Senator Markey. Thank you.
    I thank everyone for all their great work in this area.
    It is the obligation of the members of the Senate to assist 
the communities which we represent who are adversely affected 
by sea level rise and climate change to adapt to the new 
reality.
    That is why I have supported environmentally responsible 
shoreline protection projects where sand is pumped onto beaches 
to protect against storm surge and coastal erosion. In fact, 
the Army Corps was so great on Revere Beach and Winthrop in 
helping us to solve those problems after the hurricane 
snowstorm.
    The Town of Sandwich, Massachusetts attempted to use sand 
from the Federal Cape Code Canal that otherwise would be dumped 
into the ocean to protect their town. Federal requirements 
became a major obstacle.
    The Army Corps required the homeowners to provide easements 
ceding away their coastal property line forever, even though 
the sand from this beneficial use project would only remain on 
the beach for 5 years. Ultimately, the town was unable to use 
Federal funding for this essential shoreline protection 
project.
    Can I ask, General, do you believe it is reasonable for the 
Army Corps to require property owners to provide easements in 
perpetuity for beneficial use projects if the sand is only 
going to last for a few years?
    Wouldn't it be more appropriate for the easement to last as 
long as that sand remains on the beach just as kind of a 
practical way of dealing with the issue?
    General Semonite. Senator, two things. I do not know the 
details of Sandwich. I am very aware of the sand easement 
issue. All throughout Sandy and in about seven different 
States, I am not sure I have ever been asked the question of 
how long should an easement last and it should be correlated 
back to the sand. We can certainly have that dialog.
    I think we are currently following the policy on which we 
have been very consistent that, if in fact, Federal dollars are 
going to put sand on a beach, normally those landowners have to 
be able to provide access for the local people to be able to 
get to the beach.
    Senator Markey. I would like to be able to work with the 
Army Corps on striking a balance, especially if that sand is, 
once again, just going to be washed away.
    General Semonite. We are always looking at options, sir.
    Senator Markey. Thank you, General.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Markey.
    Senator Boozman.
    Senator Boozman. Thank you, Mr. Chairman. Thank you and the 
Ranking Member for holding this hearing. This is really an 
important thing as we go forward in trying to figure out some 
of our infrastructure problems.
    General, I was just visiting with Senator Inhofe and heard 
the comment about the Three Rivers situation that we have in 
Arkansas where the White River hits the Mississippi. I just 
want to reemphasize how important that project is.
    That is one of those things that it is not an ``if,'' it is 
``when'' it is going to fail, probably up to a year as far as 
shutting down the Arkansas River which would be a real problem 
for Arkansas and Oklahoma and really, the whole Nation in the 
sense of being able to move goods and services.
    General Semonite. Can I give you a quick update there? I 
was not fast enough when Senator Inhofe asked me, but 
basically, on the Three Rivers Study, we did complete the 
alternatives milestone meeting in December 2015. The definitive 
plan was completed in 2017.
    Right now, we have released the draft report for policy, 
public and agency technical review. That was last April. Right 
now, we are looking at a milestone decision schedule for July 
2017.
    We are working our way through this. We think a Civil Works 
Review Board is scheduled right now for March 2018 and a 
Chief's report in June 2018. That is the current milestone. 
That is pretty aggressive but we do think there is great merit. 
We want to continue to stay on timeline.
    This has continued to get funding in 2015, 2016 and 2017. 
Obviously, it is premature to talk about 2018 but we continue 
to see a lot of value in that.
    Senator Boozman. Good. We appreciate that and you pushing 
forward. Like I said, that is a matter of if and not when. In 
Oklahoma and Arkansas, we are experiencing these 500-year 
floods about every 2 years. They really are playing havoc.
    The waterways have held up fairly well. This last one has 
really caused a lot of damage but we are in the process of 
working through that with you.
    Apart from that, there is a lot of concern with taxpayers 
and Congress about the inefficiency in the delivery of our 
infrastructure investments. Projects that should reasonably be 
completed in a few years typically last decades, delaying 
public benefits and exponentially increasing cost.
    How, if at all, can public-private partnerships help 
accelerate the delivery and create better value as far as the 
infrastructure? Do you have any ideas in the sense would 
public-private partnerships help with that situation?
    General Semonite. Senator, it definitely would. I will just 
give you a quick data point here.
    It really allows all of the funding upfront as opposed to 
dragging it over whatever time we would be able to afford it 
through the Federal Government; we are able to see that upfront 
investment.
    I will just give you the numbers I use, these are very 
simple numbers. The one Federal P-3 study that we have been 
able to push through, which is Fargo-Moorehead, if you do it 
the regular way, it would take us 16 years. The way we are 
doing it up there is 6-1/2 years.
    Senator Boozman. Since you say that, it is probably 20.
    General Semonite. It could be but I just want to give you a 
data point.
    Senator Boozman. Sixteen years?
    General Semonite. Sixteen versus 6-1/2. The Federal share, 
the regular way, would have been $850 million. The P-3 way is 
$450 million. The other big thing, the regular way would have 
been up to probably 28 contracts. The P-3 way is 11. Just 
remember those numbers. You are probably half of what the 
normal process is.
    The challenge we have is we have to get the whole team able 
to be synchronized as to how can we then enable P-3? There are 
a lot of people who do big hand waves to say P-3 has got merit 
but we have to be able to make sure, through all the different 
maize of the approval process, a P-3 is able to see the light 
of day. We are having some challenges in how we can synchronize 
that better.
    Senator Boozman. That would be great news. I know Senator 
Inhofe and Senator Cardin on this subcommittee are going to be 
working hard in that regard. We will do the same thing on the 
Water Subcommittee really looking forward to seeing how we can 
make that example happen all over the Country versus what we 
are experiencing right now.
    Thank you, Mr. Chairman.
    Senator Inhofe. Thank you, Senator Boozman.
    Senator Cardin.
    Senator Cardin. Again, let me thank our witnesses.
    I think this hearing points out the importance for us, 
General, to take a look earlier in the process on the next WRDA 
bill. Senator Markey is correct, in 2014, we passed the Water 
Resources Development bill which I think it was 7 years earlier 
before we passed the last one. We made a commitment to pass 
these bills every 2 years. We are barely able to do that in 
2016. It was one of the last bills passed by the Congress.
    It was a challenge because we had to deal with the rules on 
how we direct spending and it was not as easy to figure out all 
the different nuances. One thing was clear. We are going to see 
some different rules coming down from this Administration.
    I think it is going to be important for us, Mr. Chairman, 
to try to figure this out as a Congress earlier rather than 
later which may require some legislative authorization in order 
to make sure projects like Mid Bay are not inadvertently 
jeopardized because of the budgetary scheduling that is being 
followed on these projects.
    I would just urge us to take an earlier look at the way we 
are going to authorize the next WRDA bill so that we can make 
sure we get it done next year. I expect it will be the next 
year; it is not going to be this year, but if we could pay a 
little earlier attention.
    Secretary Rahn, I think you were correct to point out that 
although in Maryland, we concentrated on Mid Bay, there are 
many other projects in Maryland and many other projects around 
the Nation. I am glad you mentioned the C&O, the C&D and we 
also have other projects. Poplar Island is still not finished. 
We still need resources there.
    General, I could mention our efforts to make sure we 
protect our coastlines and beach re-nourishments and hurricane 
protection. These are all programs that will require our 
attention as we look at ways to make sure we can modernize our 
infrastructure and meet the current challenges.
    We know, under the best of circumstances, the resources are 
going to be very, very difficult on the public side. We know 
that. Even if we do well, it is going to be a challenge. It is 
right to look for ways we can leverage and create more 
opportunities that we all agree are needed.
    I think this hearing has been very helpful. I want to thank 
all the witnesses for your testimony.
    Senator Inhofe. I do too. I thank you, Senator Cardin, for 
your contribution here and your partnership in these efforts. 
We have been together doing this for a long time with some 
success.
    I thank all of the witnesses for coming, particularly Grant 
Humphreys. I have followed this development. I use this as kind 
of a model of what can happen elsewhere. I commented a minute 
ago about a rarely known fact that we have more miles of 
freshwater shoreline in our State of Oklahoma than any of the 
50 States. We have a lot of beauty that goes with that. You 
have made a great contribution there.
    I thank all of the witnesses very much.
    We are adjourned.
    [Whereupon, at 4:19 p.m., the subcommittee was adjourned.]
    [Additional material submitted for the record follows.]
    
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