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



 
  TRANSPORTATION, HOUSING AND URBAN DEVELOPMENT, AND RELATED AGENCIES 
                  APPROPRIATIONS FOR FISCAL YEAR 2018

                              ----------                              


                        THURSDAY, JULY 13, 2017

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:00 p.m. in room SD-192, Dirksen 
Senate Office Building, Hon. Susan Collins (chairman) 
presiding.
    Present: Senators Collins, Boozman, Reed, Murray, Durbin, 
Coons, and Schatz.

                      DEPARTMENT OF TRANSPORTATION

STATEMENT OF HON. ELAINE L. CHAO, SECRETARY


             opening statement of senator susan m. collins


    Senator Collins. The subcommittee will come to order.
    Today I am pleased to welcome the Secretary of 
Transportation, Elaine Chao. She is perhaps the most 
experienced and qualified Secretary in the Department's 
history, having previously served as Secretary of Labor, Deputy 
Secretary of Transportation, Deputy Maritime Administrator, and 
Chairman of the Federal Maritime Commission, truly an 
extraordinary record of public service.
    I am also very pleased to be joined today by my friend and 
colleague and our ranking member, Senator Jack Reed, as we 
continue the subcommittee's work on the fiscal year 2018 
appropriations bill.
    This year is going to be particularly challenging due to 
the budget caps under the current law, which are lower than the 
budget caps for fiscal year 2017. Moreover, the President's 
budget request proposes to set them even lower. The 
administration's $76 billion request for the Department of 
Transportation includes more than $3 billion in cuts to its 
programs.
    While I am encouraged that the administration provides 
increases for highway, transit, and safety programs funded by 
the Highway Trust Fund, I am disappointed in several of the 
reductions in the President's budget.
    In particular, the elimination of the highly effective and 
popular TIGER (Transportation Investment Generating Economic 
Recovery) program, for which I have consistently advocated 
since its creation nearly a decade ago, is a mistake. TIGER 
provides the flexibility to fund a wide range of transportation 
projects that promote economic development and job growth on a 
regional basis. This program offers an otherwise unavailable 
resource for vital infrastructure needs. TIGER has provided 
essential funding to develop bridge, port, and rail projects in 
Maine and every member on both sides of the aisle has seen 
TIGER projects in their home States improving our 
transportation infrastructure for Americans everywhere.
    I am also disappointed by the changes being proposed to the 
Essential Air Service (EAS) program that keeps much of rural 
America connected to the transportation network. Under the 
administration's proposal, many small and rural communities 
would be eliminated and would no longer receive air service as 
a result. In Maine, we benefit greatly from the EAS program 
that facilitates air travel for smaller communities.
    With regard to Amtrak, I am concerned about the impact that 
the elimination of long-distance service would have on shared 
infrastructure with State-supported routes such as the 
Downeaster in Maine.
    Similarly, the administration's decision to prevent transit 
New Starts from moving forward could hurt cities and 
communities that have already committed local funding in the 
hope of securing Federal funding for these projects. The 
Secretary recently signed one full funding grant agreement 
under the New Starts program, and I trust that she will 
continue to move forward with other projects for which Congress 
has already provided funding.
    The budget also proposes a $200 billion infrastructure 
initiative over 10 years. The proposal leverages $200 billion 
into $1 trillion by incentivizing non-Federal spending, 
reducing costs of Federal projects, and leveraging private 
sector investment. I look forward to learning the details of 
this initiative, such as expanding the TIFIA (Transportation 
Infrastructure Finance and Innovation Act) program, lifting the 
cap on private activity bonds, and allowing tolling on existing 
highways that may be helpful for dense or high volume areas.
    I remain concerned, however, that these proposals would be 
of little or no use for rural areas such as the State of Maine. 
As Maine's Transportation Commissioner David Bernhardt 
testified before this subcommittee in March, private equity 
firms have told him that anything less than $100 million is not 
even worth talking about for private investment in 
transportation. That eliminates virtually every transportation 
project in my State and in many others.
    For the Maritime Administration, the budget proposes to 
reduce funding for the Maritime Security Program, which is 
critical for our Nation's domestic sealift capabilities, as 
well as for training for merchant mariners at the U.S. Merchant 
Marine Academy and the six State maritime academies. I am 
dismayed to see no request or support in the budget to replace 
the aging training vessels at the State maritime academies. 
Without training vessels, merchant mariners cannot graduate and 
will not be able to work in our domestic maritime industry.
    I do want to acknowledge that the budget provides funding 
to address sexual assault and sexual harassment problems at the 
U.S. Merchant Marine Academy, an issue that Senators Reed, 
Murray, and I are very committed to seeing addressed. And I 
know it is a priority for the Secretary as well.
    Finally, I am troubled by the $250 million reduction for 
the Federal Aviation Administration, the agency that keeps our 
aviation system the safest and most efficient airspace in the 
world. The proposed reductions would result in a reduced 
workforce, the elimination of important programs such as the 
Contract Weather Observers Program, and would prevent projects 
such as tower construction from moving forward.
    The current FAA authorization expires at the end of this 
fiscal year. The President has put forth a set of principles 
for shifting the air traffic control function to an 
independent, non-governmental corporation. I continue to have 
serious reservations about this approach.
    The public would not be well served by exempting any part 
of the FAA from annual congressional oversight. Congressional 
oversight ensures that the FAA maintains a system that works 
across the aviation industry, including general aviation and 
small and rural communities. Rural States represented by 
members of this committee benefit greatly from services that 
connect rural America with the larger transportation network.
    NextGen is modernizing our air traffic control system, and 
it is happening today. This progress is due to the 
collaborative efforts of the FAA and industry. More than $3 
billion in savings have been achieved to date. Breaking up the 
FAA at such a critical period of technological advancement 
would jeopardize further progress.
    I also want to highlight that the Department's Bureau of 
Transportation Statistics recently found that the number one 
cause of delays in our air traffic system is neither the FAA 
nor the weather, but rather the airlines themselves.
    We continue to hear that budget constraints and 
sequestration are the primary reasons to privatize. I led the 
effort in 2013, when sequestration occurred, to ensure that the 
FAA was provided additional funding to keep the agency fully 
operational and our planes flying. More important, this 
committee has protected FAA funding by providing on average 103 
percent of the agency's requests over the past decade. So I 
would have to respectfully disagree that budget constraints are 
a justification for privatization or that they have been the 
problem for our Nation's air travelers.
    Madam Secretary, again, I am delighted that you are here 
today. I look forward to working closely with you on these 
important issues.

    [The statement follows:]
             Prepared Statement of Senator Susan M. Collins
    The subcommittee will come to order. Today I am pleased to welcome 
the Secretary of Transportation, Elaine Chao. She is perhaps the most 
experienced and qualified Secretary in the Department's history, having 
previously served as Secretary of Labor, Deputy Secretary of 
Transportation, Deputy Maritime Administrator, and Chairman of the 
Federal Maritime Commission.
    I am also pleased to be joined today by my friend, and our Ranking 
Member, Senator Jack Reed, as we continue the subcommittee's work on 
the fiscal year 2018 appropriations bill.
    This year is going to be particularly challenging due to the budget 
caps under current law, which are lower than the budget caps for fiscal 
year 2017. Moreover, the President's budget request proposes to set 
them even lower. The Administration's $76 billion request for the 
Department of Transportation includes more than $3 billion in cuts to 
its programs.
    While I am encouraged that the Administration provides increases 
for highway, transit and safety programs, funded by the highway trust 
fund, I am disappointed in several of the reductions in the President's 
request. In particular, the elimination of the highly effective and 
popular TIGER program, for which I have advocated consistently since 
its creation nearly a decade ago, is a mistake. TIGER has the 
flexibility to fund a wide range of transportation projects that 
promote economic development and job growth on a regional basis. This 
program offers an otherwise unavailable resource for vital 
infrastructure needs at the local level. TIGER has provided essential 
funding to develop bridge, port and rail projects in Maine, and EVERY 
member on both sides of the aisle has seen TIGER projects in their home 
states, improving our transportation infrastructure for Americans 
everywhere.
    I am also disappointed by the changes being proposed to the 
Essential Air Service program that keeps much of rural America 
connected to the transportation network. Under the Administration's 
proposal, many small and rural communities would be eliminated and no 
longer receive air service as a result. In Maine, we benefit greatly 
from the E.A.S. program that facilitates air travel to smaller 
communities.
    With regard to Amtrak, I am concerned about the impact that 
elimination of long-distance service would have on shared 
infrastructure with state-supported routes, such as the Downeaster in 
Maine. Simlarly, the Administration's decision to prevent transit ``New 
Starts'' from moving forward could hurt cities and communities that 
have already committed local funding in the hope of securing Federal 
funding for projects. The Secretary recently signed one full-funding 
grant agreement under the New Starts program, and I hope she will 
continue to move forward with other projects for which Congress has 
already provided funding.
    The budget also proposes a $200 billion infrastructure initiative 
over 10 years. The proposal leverages $200 billion into $1 trillion by 
incentivizing non-Federal spending, reducing costs of Federal projects, 
and leveraging private sector investment. I look forward to learning 
the details of this initiative, such as expanding the TIFIA program, 
lifting the cap on private activity bonds, and allowing tolling on 
existing highways, that may be helpful for dense or high volume areas.
    I remain concerned, however, that these proposals would be of 
little to no use for rural areas such as Maine. As Maine's 
Transportation Commissioner Bernhardt testified before this 
subcommittee in March, private equity firms have told him that anything 
less than $100 million is not worth even talking about for private 
investment in transportation. That eliminates virtually every 
transportation project in my state and many others.
    For the Maritime Administration, the budget proposes to reduce 
funding for the Maritime Security Program, which is critical for our 
nation's domestic sealift capabilities, as well as training for 
merchant mariners at the U.S. Merchant Marine Academy and the six state 
maritime academies. I am dismayed to see no request or support in the 
budget to replace the aging training vessels at the state maritime 
academies. Without training vessels, merchant mariners cannot graduate 
and will not be able to work in our domestic maritime industry.
    I do want to acknowledge that the budget provides funding to 
address sexual assault and sexual harassment at the U.S. Merchant 
Marine Academy, an issue that Senators Reed, Murray, and I are very 
committed to seeing addressed.
    Finally, I am troubled by the $250 million reduction for the 
Federal Aviation Administration, the agency that keeps our aviation 
system the safest and most efficient airspace in the world. The 
proposed reductions would result in a reduced workforce, the 
elimination of important programs such as the Contract Weather 
Observers Program, and would prevent projects such as tower 
construction from moving forward.
    The current F.A.A. authorization expires at the end of this fiscal 
year, and the President has put forth a set of principles for shifting 
the air traffic control function to an independent, non- governmental 
organization. I continue to have serious reservations about reforming a 
system that is not broken.
    The public would also not be well-served by exempting any part of 
the F.A.A. from annual Congressional oversight. Congressional oversight 
ensures the F.A.A. maintains a system that works across the aviation 
industry, including general aviation and small and rural communities. 
Rural states represented by members on this Committee benefit greatly 
from services that connect rural America with the larger transportation 
network.
    NextGen is modernizing our air traffic control system, and it is 
happening today. This progress is due to the collaborative efforts of 
the F.A.A. and industry. More than $3 billion in savings have been 
achieved to date. Breaking up the F.A.A. at such a critical period of 
technological advancement would jeopardize further progress.
    I also want to highlight that the Department's Bureau of 
Transportation Statistics recently found that the number one cause of 
delays in our air traffic system is neither the F.A.A. nor weather, but 
rather the airlines themselves.
    We continue to hear that budget constraints and sequestration are 
primary reasons to privatize. I led the effort in 2013, when 
sequestration occurred, to ensure the F.A.A. was provided additional 
funding to keep the agency fully operational. More important, this 
Committee has protected F.A.A. funding by providing, on average, 103 
percent of the agency's requests over the last decade. So I would have 
to disagree that budget constraints have been a problem for our 
nation's air travelers.
    Madam Secretary, I look forward to working closely with you on 
these issues. I now turn to Senator Reed for his opening statement.

    Senator Collins. And I now turn to our ranking member for 
his opening statement.

                 OPENING STATEMENT OF SENATOR JACK REED

    Senator Reed. Thank you, Chairman Collins.
    Secretary Chao, I look forward to your testimony today. I 
join the Chairman and salute you for your lifetime of public 
service. We have always had a productive relationship with your 
Department, and I look forward to that relationship continuing 
under your leadership.
    Chairman Collins, I am pleased that you are moving quickly 
to advance the business of this subcommittee. It is important 
to get back on track after the administration's decision to 
delay closing out the fiscal year 2017 process. In order to 
pass all 12 appropriations bills, we need a new budget 
agreement that gets beyond the $56.5 billion in non-defense 
discretionary cuts the administration has proposed for fiscal 
year 2018 and the $1.56 trillion in cuts it wants over the next 
10 years. We need a budget deal that provides essential 
increases to meet the needs of the Nation, as well as parity 
between defense and non-defense discretionary spending.
    We will also need the cooperation of the administration to 
meet our responsibilities to the American people. President 
Trump's tweet in May that we need a good shutdown in September 
and many of his budget proposals that make cuts for cuts' sake 
only add anxiety, exacerbate uncertainty, and promote bad 
strategic decisions. One of those bad decisions is the 
President's shortsighted proposal to privatize our Nation's air 
traffic control system.
    On a bipartisan basis, this subcommittee has worked to 
bolster the FAA by providing more than 100 percent of its 
budget requests over the last 4 years, as the Chairman pointed 
out, and 99 percent over the last decade. Our consistent 
investments in operations and NextGen (Next Generation Air 
Transportation System) are showing significant benefits to the 
airlines and the traveling public. Rather than maintaining this 
trend of supporting the FAA, the administration is proposing 
over $250 million in cuts. The objective of the President's 
budget seems clear: cut spending to undermine performance, 
blame government for the resulting inefficiencies, and then 
hand out public assets to the private sector at bargain 
basement prices or at no cost at all.
    The private sector does many, many things well, but it does 
not do everything better. In the case of air traffic control, 
privatization will place the airlines in charge and leave rural 
America and smaller urban centers behind. It will also 
compromise access, public oversight, and safety.
    We have the safest, largest, and most complex air traffic 
control system in the world. We should not hand it over to a 
nongovernmental entity that is not answerable to Congress or 
the courts. The risks are simply too great, especially when the 
benefits of our NextGen investments are yielding positive 
results.
    I reviewed the rest of the administration's budget request, 
as well as the infrastructure outline that was rolled out over 
the last 2 months. Across these proposals, we see a disconnect 
between rhetoric and reality. The administration talks about 
more money for infrastructure but cuts successful and popular 
programs like TIGER, as the Chairman indicated, and transit 
Capital Investment Grants, the CIG program. The CIG program was 
just reauthorized by a Republican-controlled Congress in 2015, 
providing the certainty of a continued partnership between 
Federal and local governments to address population growth and 
congestion challenges. And yet, projects which meet the 
statutory requirements and have significant local investment 
have been delayed.
    I appreciate that you finally signed the CalTrain grant 
agreement last month, but there are many other projects that 
the committee identified in the 2017 Omnibus that have been 
provided funding and will meet the requirements for a grant 
agreement soon. We need to have confidence that DOT will issue 
grants for these and future projects in accordance with the law 
and the directives of this subcommittee.
    I also note that after the fanfare of Infrastructure Week, 
we still do not have a real comprehensive infrastructure plan 
from the administration. So far we have only seen massive tax 
incentives for private investors and States shouldering more of 
the burden to fix our infrastructure through so-called 
devolution. This approach will not fix our crumbling roads, 
replace lead water pipes, or build new schools without placing 
a huge financial burden on average Americans. Instead, we need 
real Federal investment in our airports, bridges, transit 
systems, and ports in order to create jobs and strengthen our 
economy now and into the future. We must reverse the 
disappointing direction of this budget that cuts spending on 
infrastructure and consequently eliminates jobs.
    I hope that through the fiscal year 2018 appropriations 
process, we can seriously address the infrastructure needs of 
this country with real investments that reduce congestion and 
improve our economy.
    Secretary Chao, thank you again for your service and 
preparing for us today. I look forward to hearing your 
testimony and responses to our questions.
    And, again, thank you, Chairman Collins.
    Senator Collins. Thank you very much, Senator Reed.
    Secretary Chao, welcome. We look forward to hearing your 
testimony.

                SUMMARY STATEMENT OF HON. ELAINE L. CHAO

    Secretary Chao. Thank you. Chairman Collins, Ranking Member 
Reed, members of the subcommittee, thank you for the 
opportunity to discuss the President's fiscal year 2018 budget 
request for the Transportation Department.
    As you mentioned, we all share the same goals, to ensure 
that our country's transportation systems are safe, dependable, 
and ready to adapt to transformational and new technologies. 
The President's 2018 budget represents a bold vision for our 
transportation infrastructure. The administration has carefully 
studied our current spending patterns, has taken a close look 
at programs that may not be meeting their intended purposes, 
have outlasted their usefulness, or could have been replaced 
with new initiatives that will better address future 
transportation needs.
    The President is requesting $76 billion for transportation. 
This request fully funds surface transportation programs 
included in the FAST Act (Fixing America's Surface 
Transportation Act) and provides a steady state funding for the 
majority of other transportation programs.
    The budget provides new policy direction in several key 
areas.
    First, as acknowledged, our transportation infrastructure 
is crumbling and in urgent need of attention. To address this 
concern, the President has proposed long-term reforms that 
change the way that infrastructure projects are regulated, 
funded, delivered, and maintained. And the President's plan 
will create incentives for additional State, local, and private 
funding, and will ensure that Federal funding is leveraged to 
maximize infrastructure investment. The President has 
identified a total Federal commitment of $200 billion for 
infrastructure improvements, of which a portion will be 
directed toward rural America.
    Next, the President's budget also includes a proposal that 
represents a major shift for the FAA. Despite spending billions 
of taxpayer dollars over decades, the government has not been 
able to fully implement state-of-the-art air traffic control 
technology. Air traffic controllers still use paper strips to 
keep track of flights, and pilots are guided using 1960's radar 
technology. Congestions and delays cost our economy more than 
$25 billion annually in higher fuel costs and lost 
productivity, not to mention a deterioration in ordinary 
citizens' and residents' quality of life. By 2020, air 
passenger traffic will soar to over a billion annually. Air 
freight is expected to more than double over the next 3 
decades. Drones and unmanned aircraft systems will have to be 
integrated into this national air space. Without change, the 
current air traffic control system will not be able to keep up.
    We do have the safest air space in the world, and we want 
to keep it that way. So this administration has proposed 
liberating air traffic control operations to a non-profit, 
nongovernmental, independent cooperative. The safety regulatory 
oversight function will still remain at FAA, and this would 
actually solve longstanding conflict-of-interest issues with 
the FAA, i.e., having an operating entity regulate itself for 
safety. Air traffic control regulating its own safety is a 
conflict of interest. And more than 50 countries worldwide 
currently have this separated structure.
    Finally, the President calls for reforms to some of our 
other transportation programs. These reforms will improve 
programs like the Federal Transit Administration's Capital 
Investment Grants program, which you mentioned; the Essential 
Air Service; Amtrak's long-distance routes.
    The President also recommends that we revisit 
transportation grant programs such as the TIGER grants. The 
infrastructure proposals outlined by the President will 
highlight alternative ways to fund worthy projects using a 
different funding formula moving forward. It will also 
recognize the administration's commitment to rural America as 
we revitalize our transportation infrastructure.
    I would like to address one more topic that has come up in 
other hearings, and that is the issue of agency responsiveness 
to requests made by Congress. I have always believed in working 
with both sides of the aisle. It is my intention to always 
respond to all congressional correspondence and requests 
without regard to party or seniority. And I believe that my 
record as Secretary of Labor and thus far Secretary of 
Transportation demonstrates my good faith on this subject.
    Once again, I thank you for the opportunity to appear 
before you today to discuss the President's budget. And I will 
be happy to answer any questions that you may have.

    [The statement follows:]
               Prepared Statement of Hon. Elaine L. Chao
                              introduction
    Chairman Collins, Ranking Member Reed and members of the 
Subcommittee thank you for the opportunity to meet today to discuss the 
President's fiscal year 2018 Budget request for Transportation. I am 
deeply honored to serve as the 18th Secretary of Transportation, and I 
look forward to working with all of you to address America's 
transportation needs. I know that together, we share a commitment to 
ensuring our transportation systems are safe, effective, and ready to 
adapt to new technologies.
    The President's fiscal year 2018 Budget represents a bold change of 
course for our Nation and challenges all of us to rethink the way we 
are setting our priorities. It calls on us to reexamine our current 
spending and our continuing commitment to programs that may not be 
meeting their intended purpose, have outlasted their usefulness, or 
simply need to be replaced with new initiatives that will better 
address our requirements for the future. Some funding reductions are in 
recognition that our resources are limited and that we have an 
obligation to future generations to keep our spending under control.
    The President's Budget requests $76 billion to support 
transportation programs in fiscal year 2018. The request fully funds 
surface transportation programs included in the Fixing America's 
Surface Transportation (FAST) Act and provides levels of funding for 
the majority of other Transportation programs roughly in line with 
fiscal year 2016 levels. But just as important, the budget promises a 
renewed focus on the state of our infrastructure--targeting ways to 
streamline approvals, encourage cost-sharing, and prioritize projects 
with the greatest value to Americans.
                    a new infrastructure initiative
    Our transportation infrastructure is aging. We need a focused 
approach to address this problem. The President proposes to tackle 
these problems by seeking long-term reforms on how infrastructure 
projects are regulated, funded, delivered, and maintained. The 
President's plan proposes reforms that will incentivize additional 
state, local, and private funding and will ensure that Federal funding 
is leveraged to maximize and significantly increase total 
infrastructure investment. The President has identified a total Federal 
commitment of $200 billion for infrastructure improvements. These 
resources will work in tandem with reforms so that progress can be 
achieved quickly.
    While transportation specific infrastructure needs will be a key 
element of the President's plan, the entire initiative will encompass 
other Federal programs as well. The infrastructure plan will involve 13 
Federal Departments and Agencies working in concert to address the 
following key principles:

  --Make targeted Federal investments on the most transformative 
        projects. These will be high priority projects from the 
        perspective of the Nation or the region, or projects that will 
        change the nature of how infrastructure is designed, built, and 
        maintained.
  --Encourage states, localities, and tribes to take their own action 
        to improve their infrastructure. Because Federal resources are 
        not unlimited, and the needs are great, waiting for Washington 
        to fund repair and renovation projects only delays the 
        improvements even longer. State and local efforts can be helped 
        by streamlined Federal permitting and regulatory processes.
  --The private sector has capital that could and should be utilized to 
        improve our infrastructure. We can make Federal and state 
        dollars stretch further by leveraging, and we can tap into the 
        management benefits offered by the private sector, such as 
        procurement methods, market discipline, and long-term 
        maintenance protocols. The Administration does not believe 
        public-private partnerships are the answer to all 
        infrastructure needs, but they can play a much stronger role in 
        fixing America's infrastructure.
  --We should also align infrastructure investment with the entities 
        best suited to carry it out and maintain it. The Administration 
        will look for opportunities to divest from certain functions 
        that the private sector could do more effectively. The Federal 
        government can also be more efficient about disposing of 
        underused capital assets, ensuring that those assets are put to 
        their best use.

    With these reforms and principles in mind, I am confident that the 
Federal Departments and Agencies working together will be successful in 
developing an infrastructure improvement initiative that will achieve 
the President's vision.
                         charting a new course
    The President's call for reforms includes changes affecting some of 
our traditional transportation programs. One of these areas is the 
Federal Transit Administration's Capital Investment Grants program. The 
Capital Investments Grants program supports projects that have 
primarily local direct benefits. While the President's Budget honors 
commitments to projects with existing full funding grant agreements, it 
does not recommend funding for new projects. The Administration is 
reexamining programs where significant Federal resources are spent on 
activities that have primarily local benefits--including what fiscal 
and other tools might be the most appropriate to encourage investment 
in those jurisdictions.
    Along the same lines, the President's budget request does not 
include funding for the discretionary portion of the Essential Air 
Service (EAS). EAS was originally proposed as a temporary program 
nearly 40 years ago at about $50 million. Today, two budgetary accounts 
are funding the EAS program at a total cost of $280 million. Yet, many 
EAS flights are not full and have high subsidy costs per passenger, 
calling into question the affordability of this program. But this poses 
a conundrum for all of us, because we recognize how critical the EAS 
progam is to rural areas.
    To address this situation, the President's Budget requests support 
for a redesigned program known as the Transportation Aviation 
Assistance to Remote Areas (TAARA) program. This new program will be 
funded exclusively by mandatory overflight fees at $119 million. By 
reworking the old EAS program, we will help reset the path for remote 
air assistance going forward. The objective is to sustain air service 
to rural locations most in need, and to establish relevant objective 
criteria for making those determinations.
    Funding for Amtrak's long distance routes is another area where 
Federal investments do not match the level of usage. Amtrak's long 
distance services are used by a relatively small number of passengers. 
These trains are very expensive to operate and maintain; and account 
for much of Amtrak's operating losses. The President's budget 
recognizes this is an area with a low return on investment and instead 
asks us to concentrate our resources on other portions of Amtrak's 
system.
    The President also recommends an end to the Transportation 
Investments Generating Economic Recovery (TIGER) grant program at a 
savings of nearly $500 million. With the passage of the FAST Act and 
the creation of a new competitive grant program, the Department has 
other opportunities for funding those projects that have nationally or 
regionally significant characteristics. Grant programs that meet the 
objectives of the new infrastructure initiative will also be considered 
for future investments.
                           faa modernization
    The President's fiscal year 2018 budget also includes a bold shift 
in the operational model used for the Federal Aviation Administration 
(FAA). First, I would like to recognize the dedicated individuals of 
the FAA who safely and efficiently guide thousands of aircraft carrying 
millions of passengers and tons of cargo to destinations around the 
country. However, while the FAA has established a tremendous safety 
record while operating the world's most complex air traffic system, it 
has been hindered by the continued use of old technology.
    After billions of dollars invested and years of effort to modernize 
our air traffic control system, our air traffic controllers are still 
dependent on paper strips to manage the airspace. And while we have 
stayed stuck in an old-fashioned approach, many other countries 
throughout the world have successfully implemented new models for 
delivering safe and reliable air traffic control services using non-
governmental structures. The President's budget request asks Congress 
to enact FAA modernization legislation based on the principles he has 
just announced. This legislation would, begin a multi-year 
modernization effort that will transfer the day-to-day air traffic 
control services provided today by FAA to a new non-government 
cooperative. The Federal government would retain its role in regulating 
aviation safety, just like it does for all other modes of 
transportation. As we begin this modernization effort, we will be 
working to structure the new organization around the following 
principles:

  --A non-profit, non-governmental cooperative is the best model to 
        deliver air traffic services in a safe, efficient, and 
        innovative manner.
  --A board of directors that represents all users of the National 
        Airspace System will better align air traffic services to 
        customer demands. No one stakeholder group would control the 
        Board.
  --A fee structure would be put in place to allow aviation users to 
        pay the cost of the services of the air navigation provider 
        with the understanding that the provider would not charge any 
        more than necessary to recover its costs. Any surplus would be 
        plowed back in to the entity; there are no shareholders that 
        would profit.

    When completed, this modernization effort will deliver an 
organization that uses modern business tools and management 
flexibilities that are comparable to those used in the private sector. 
This flexibility would speed up the implementation of new, state-of-
the-art technology for air traffic control that will allow for greater 
precision in managing the airspace, thus enhancing safety and 
alleviating flight delays that have become an increasingly aggravating 
element of air travel. The Nation that invented air travel should 
surely do better.
    Thank you again, for the opportunity to appear before you today to 
discuss the President's fiscal year 2018 budget. I will be happy to 
answer your questions.

    Senator Collins. Thank you very much, Madam Secretary.
    I want to talk to you first about the infrastructure 
program that the President has given us an outline of but not 
really very many details. I will tell you I am very excited 
about an infrastructure program. The needs are overwhelming all 
over our country, and I think this is an area where Republicans 
and Democrats could work together with the administration.
    But I am somewhat confused by some of the figures that are 
in the President's budget. For example, there actually is a $95 
billion cut to the Highway Trust Fund over the 10-year window. 
The budget simply assumes that after the FAST Act expires in 
fiscal year 2020, that spending from the Highway Trust Fund 
will be reduced to the level supported by the current gas tax. 
That seems to undermine the $200 billion initiative, which is 
expected to be leveraged in a trillion dollar package.
    Is it not more accurate then to characterize the overall 
infrastructure proposal as only $105 billion initiative given 
the $95 billion reduction from the Highway Trust Fund?
    Secretary Chao. The Highway Trust Fund is an issue that has 
to be addressed in the long term. We know very well with the 
increased fuel economy that cars are paying less through 
gasoline. Passengers, users are paying less in gasoline taxes 
as the cars become more fuel efficient. So this is a longer-
term issue as to how we fund our highway and infrastructure 
going forward into the future.
    We actually have begun to look at perhaps using different 
kinds of measurements for funding highways, one of which is 
using mileage traveled as a parameter as well. We have a couple 
of pilot projects going on that. We have actually six pilot 
projects going. We have yet to conclude as to what the final 
answers are, but it appears as if--I will just speak very 
quickly. One is if we can somehow collect that tax through the 
gas pump, that is something that is very familiar to 
passengers. They will be more familiar with that. But secondly, 
educating the public on the needs to transfer to a different 
type of--or adding a different type of gasoline tax, a mileage 
tax, or whatever takes a great deal of education.
    So having said that, we are looking at ways with which to 
fund the infrastructure proposal, which is why it has taken us 
quite a while to come up with a proposal and the details. We 
hope still that the base parameters as we have announced in May 
will be that it will be $1 trillion over 10 years. It will be 
$200 billion that will be currently discussed, and we are very 
much looking forward to discussing this with Congress on how to 
structure that 200.
    But as of now, there is a thought that we want to emphasize 
more on those projects that would include or collaborate more 
with the private sector. So for those State and local projects 
that have more of a private sector component, that perhaps 
there will be a greater portion of the $200 billion that will 
be given to the applicant.
    But, again, these are tough questions. We want to make sure 
that we are in tune with the Congress. So we have gone out with 
principals. We have been talking with Members of Congress. We 
hope to provide you our details by this fall. I am very much 
aware of the different types of thinking on the $200 billion. 
So that is part of our challenge in coming to definite 
principles or whatever. We want to give ourselves greater 
flexibility, work with the Congress, and continue with 
discussion on these different ways to fund the $1 trillion.
    Senator Collins. The President expressed openness to 
raising the gas tax in a Bloomberg News interview recently, 
something that more than 30 States have done. Is the President 
taking a look at increasing the Federal gas tax?
    Secretary Chao. I can say at this point that nothing is off 
the table.
    Senator Collins. Thank you.
    Senator Reed.
    Senator Reed. Thank you very much, Madam Chairman.
    Again, Madam Secretary, welcome.
    As I indicated in my remarks, I was very pleased to see 
that you signed the CalTrain grant agreement, but will you 
follow through with the clear direction from Congress in the 
omnibus and provide funding for the projects identified in the 
final joint statement?
    Secretary Chao. The CIGs are really difficult because, 
obviously, the President's budget has put a limit on it.
    CalTrains was a very particular case. I do not need to go 
into all the details. It was right at the cusp. It had already 
been signed, and it was a change of administration. But I also 
am very much aware that CIGs occur over a period of time. 
Whatever happened in the 2017 budget, we of course will carry 
out. With the 2018 budget, so far the President's budget is 
what it is. We will adhere to the will and wishes of Congress, 
as you so desire. And then these are multiyear projects. And I 
will work with all of you.
    Senator Reed. Well, we are talking about fiscal year 2017 
money, which you can obligate right now. These grant agreements 
do entail in most cases several years of funding going forward, 
but that is not unusual in the Federal Government.
    Secretary Chao. Your question is.
    Senator Reed. You have projects that are qualified for 
funding. Will you go ahead and fund those projects even though 
you must rely on Congress next year for the funding to continue 
them?
    Secretary Chao. Whatever funding you give us, we will 
distribute for 2017.
    Senator Reed. It is my understanding that there are funds 
available and projects eligible before you that you could fund. 
Is that accurate under the CIG program?
    Secretary Chao. I do not think so. Maybe I am mistaken but 
I will get you answer to that. Whatever you have given to us, 
it will go out.
    Senator Reed. Okay. Even though it will require additional 
appropriations in fiscal year 2018?
    Secretary Chao. Yes. Because you have given us the money, 
we have to give it out. And then 2018, either the Congress is 
going to do something because our budget is----
    Senator Reed. No. Your budget will be what we finally, on a 
bipartisan basis, vote for. I understand that.
    Let me also echo something that Senator Collins brought up 
about the budget proposal with respect to Amtrak. As you cut 
long-distance routes, ironically it appears from our analysis 
that it is going to cost more overall because of the loss of 
passenger revenue and having to terminate individual contracts 
and other provisions. Can you provide us with the cost 
associated with shutting down Amtrak's long-distance routes so 
that we can make a judgment about whether it makes sense 
economically?
    Secretary Chao. I will certainly do that.
    Senator Reed. Thank you.
    The other aspect here too is that long-distance routes 
contribute, in part, to the capital expenditures for the 
Northeast Corridor, and that is something of concern to many of 
us here on the committee. It appears that there will not be 
adequate resources for the Northeast Corridor. In fact, we read 
every day, particularly around New York City, of the problems 
with Amtrak service, including derailments, et cetera. Are you 
able to focus additional resources on the capital 
infrastructure for the Northeast Corridor?
    Secretary Chao. The Northeast Corridor is the only one that 
has the ability to sustain itself. So there is a great deal of 
passenger ridership focused on that Northeast Corridor. It is 
going to have some problems this summer, obviously, because of 
repairs problems, maintenance that is required. We are working 
very closely with Amtrak and also with the local and State 
authorities in that region. Aside from the President's budget, 
we will not have what is above that.
    Senator Reed. This issue goes to this whole cost-benefit 
analysis of shutting down long-distance routes. There are 
massive capital investment needs on the Northeast Corridor 
which are way beyond the capacity of Amtrak in any way, shape, 
or form alone just on revenue, fares, et cetera to pay for, 
including bridges and track safety. And that is something that, 
again, I do not see reflected strenuously enough in the budget. 
So let me make that comment.
    Thank you.
    Senator Collins. Thank you.
    Senator Boozman.
    Senator Boozman. Thank you, Madam Chair.
    And thank you for being with us today. We appreciate all of 
your great efforts.
    I want to talk about a couple of things that are important 
I think for rural America and really get some reassurance and 
just kind of figure out what is going on. The Essential Air 
Service is certainly very important for many of our States in 
areas that are underserved because they do have towns, 
communities that really do depend on this. You know, your 
airports, your hospital, things like that are so important in 
attracting industry. And the name of the game is jobs, jobs, 
jobs, creating a better economy. But to cut the EAS program for 
rural communities really would have a pretty devastating effect 
for many, many areas.
    So I guess I would like for you to comment a little bit 
about that, what your thoughts are regarding that and how do we 
go about perhaps doing something different.
    Secretary Chao. I am very much aware of the needs of rural 
America, and I think the administration is as well. So when we 
talk about the infrastructure proposal that is coming up, there 
will be a separate chapter that is devoted to address the needs 
of rural America.
    On EAS alone, I think there has always been this discussion 
about how to continue essential air service, provide the 
necessary air service to rural communities, and how to balance 
that with some services that are very infrequently used on a 
daily basis. So, for example, the EAS was supposed to be 
temporary. It is now permanent. And it funds regularly some 
passenger embarkments of three a day. And the EAS subsidy is 
about $107 per passenger.
    But having said that, the discretionary part has been 
eliminated. I am very much aware of the concerns of the 
Congress on EAS. So we are working with the mandatory portion 
of the fiscal year budget, and we are going to take that. We 
renamed it to TAAARS. It is a new program. So we are going to 
address the needs on EAS with the mandatory portion because of 
the concerns that we have heard from lawmakers.
    Senator Boozman. Good. I appreciate that very much.
    And along with that--I am not going to really talk much 
about it, but you are going to hear a lot about TIGER grants 
today I think from many members. And certainly that is a 
concern, especially for rural America. We hear a lot about the 
public-private partnerships, but the problem is in much of 
rural America, that really does not work as well as we would 
like.
    I was happy to see President Trump's budget would like to 
lift the cap on private equity bonds while also expanding 
eligibility to other non-Federal public infrastructure. I 
believe these changes will provide meaningful opportunities for 
the private sector to work with the government to help address 
America's deficient infrastructure.
    Can you comment about how opening up the eligibility 
requirements reduces the amount of public contribution towards 
public-private partnerships?
    Secretary Chao. There are actually a lot of different 
infrastructure bank-like structures and programs throughout the 
government. Agriculture has one. I think Interior. Certainly at 
the Department of Transportation as well. We hope that by 
lifting the cap, that more applicants, more pension funds, for 
example, just as an example, but more private sector funds 
would be able to come in because right now we have used a lot 
of it already under the FAST Act, for example, currently at the 
Department of Transportation. We have limited authority under 
TIFIA and also RIF programs.
    Senator Boozman. Very good.
    Another issue, again, that is important to many of our 
rural States is the Contract Tower Program, and that is another 
area, really in some of our situations where we are talking 
about very busy air space. In a privatized air traffic control 
system, can you talk a little bit about how we would assure 
protection of those areas, protection of the Contract Tower 
Program from elimination or reduction?
    Secretary Chao. Actually having the air traffic control 
operations out of the FAA makes it better for the contract 
towers because every single budget cycle, every single year, 
the contract towers are threatened with budget uncertainties, 
budget cuts, and they are the first things to be targeted for 
budgetary uncertainties.
    Right now, the Aviation Trust Fund has a surplus of over $6 
billion. If the air traffic control operations were liberated 
from FAA, allowed to go into its own co-op structure--and that 
is all it is. It is a difference in financing structure. It is 
a difference in governance structure--the $6 billion would be 
allowed to be plowed back and reinvested into the air traffic 
control system and thereby not be vulnerable to the 
uncertainties of the annual budgetary process.
    Senator Boozman. Good. Thank you very much.
    And thank you, Madam Chair.
    Senator Collins. Thank you.
    Senator Coons.
    Senator Coons. Thank you, Chair Collins, Ranking Member 
Reed.
    Thank you, Madam Secretary. Great to be with you again.
    I was encouraged to hear a great deal of talk about 
infrastructure during the campaign. Well built, well maintained 
infrastructure is absolutely critical for our national 
competitiveness. It ensures that goods can reach markets, 
employees can access jobs, and folks are incentivized to invest 
and build facilities here in the United States. And as 
Chairwoman Collins mentioned, it is exactly the sort of thing 
that could command bipartisan support.
    We all know that our infrastructure is badly decayed. The 
American Society of Civil Engineers gives us a D plus as a 
Nation, a grade none of us would accept from our kids. So the 
time I think is now to make critical investments in highways 
and rail and ports and public transit and waterways and 
airports. And yet, several of the more compelling, innovative 
ways we could accomplish that strike me in this budget as being 
either dramatically reduced or altogether eliminated.
    As someone who nearly lives on Amtrak--I commute to and 
from Delaware several times a week--I understand firsthand the 
importance of intercity passenger rail to our transportation 
network and the extent to which it significantly reduces 
highway congestion, connects people more efficiently, and 
provides economic opportunity. I live in the Northeast 
Corridor, as do several of our committee members, but I think 
Amtrak has benefit to our whole country.
    I was struck the budget proposal, Madam Secretary, cuts 
Amtrak nearly 50 percent and eliminates support for long-
distance service. That includes routes like the Crescent, 
Palmetto, and Cardinal. The Cardinal serves Kentucky and 
Wilmington, Delaware. The Crescent and Palmetto serve all the 
way up and down the east and to the south.
    I understand there are concerns about the long-term 
solvency of the Highway Trust Fund, and I worry that these 
proposed deep cuts to passenger rail would simply increase 
pressure on our highway infrastructure and on the Highway Trust 
Fund.
    Help me understand how you can justify cuts so deep and so 
broad in Amtrak funding that has been demonstrated to have a 
positive impact on getting people off our highways and moving 
them efficiently not just up and down the east coast but around 
the whole country.
    Secretary Chao. Well, the Northeast Corridor is the one 
with the most promise. It has got the route with the most 
population density and also passenger ridership.
    We are talking the Amtrak for the long-distance services, 
which are very expensive to operate and account for the 
majority of Amtrak's operating losses. The losses are about 
$500 million a year. And while the Amtrak long-distance serves 
a geographically very, very expansive area, long-distance 
trains carry a relatively small number of passengers, about 4.6 
million, or 15 percent of Amtrak's total ridership. In fact, 
the Northeast Corridor's ridership is about 4.6 million. And so 
you have got long-distance ridership, which is about the same 
as the Northeast Corridor, and the long-distance ridership and 
trains have a terrible on-time performance as well.
    So hopefully rearranging their fundings and terminating the 
Federal funding for the long-distance will allow Amtrak to 
focus its resources on the most vibrant part of Amtrak, which 
is the Northeast Corridor. So I do not think your part of your 
ridership of Amtrak would suffer.
    Senator Coons. Thank you, Madam Secretary. I do want to 
focus on more than just my individual experience, although it 
does highlight its importance to some of us.
    Let us focus then on the Northeast Corridor. It has got a 
$38 billion state of good repair backlog. Can you just address 
how you envision that state of good repair backlog being 
addressed given that the proposed funding levels for the NEC 
and for the Federal-State partnership for the state of good 
repair program are dramatically below what was authorized in 
the FAST Act?
    Secretary Chao. You make an excellent point. These are 
repairs which have been delayed, and the maintenance 
requirements are immense. And so there has to be some way of 
looking at all these repairs, strategically figuring out how 
best to prioritize these repairs and have a program and then 
execute. Amtrak has a new president now, and I am very hopeful 
that the new president and the board will be able to address 
some of these issues because this will be a very, very tough 
summer for Amtrak.
    Senator Coons. It will.
    Let me close with just a comment, if I might, Madam Chair. 
I also note the elimination of TIGER grants. In my experience 
both in county government, now in the Senate, TIGER has been a 
very effective, multimodal, multi-region or State opportunity 
with local match, with rigorous review criteria. It has been a 
way to attract innovative solutions to regional transportation 
problems. I am from one of the few places in the country where 
you have got four States all within 15 minutes of each other. 
TIGER strikes me as a terrific solution to our transportation 
problems, and I am struck that it is also being eliminated. It 
is my hope we can work to resolve this.
    Thank you, Madam Chair.
    Secretary Chao. I think we have begun to hear from Members 
of Congress on the importance of this program. We are hopeful 
that perhaps in the infrastructure proposal, it will be 
repackaged and recast.
    Senator Collins. Just to follow up on what Senator Coons 
said, there have been 421 projects funded under TIGER out of 
7,000 applications, which just shows how strong the demand is 
for that program.
    I would now like to call on a Senator, who does not have 
four States within 15 minutes, Senator Schatz.
    Senator Schatz. Thank you, Chair Collins. We are not 
divided by water but connected by water. I want you to know 
that.
    The first question I have, Secretary Chao, is the lessons 
on funding alternatives. I know you are not done with your 
process and you had some initial comments. But the Hawaii 
Department of Transportation is participating in this pilot 
project, and I wonder if you might offer some preliminary 
insights into how we might find--well, how we might find 
revenue for the Highway Fund in light of increasing fuel 
efficiency.
    Secretary Chao. I am really not prepared at this point to 
say anything because I do not think there is an administration 
proposal on it yet. But clearly, the demands are huge and we 
need to find some way to address it. And as I mentioned, with 
fuel economy being so effective, the gasoline tax has decreased 
in its efficacy, and so how are we going to go out and find new 
sources? And all of that is being discussed.
    Senator Schatz. That is fine. I mean, I think it is 
reasonable to complete the pilot programs and to assess out 
what is palatable, what makes the most sense as policy. But I 
think it is not trivial that the administration is at least 
recognizing we have a revenue shortfall and that it is going to 
get worse and worse and worse, and that to the extent that 
there is a priority on infrastructure, this is a way to infuse 
infrastructure money into a fund that is growing increasingly 
bare.
    I wanted to follow up on a couple of questions that were 
asked about public-private partnerships. And I just want to ask 
you how you would answer any of our rural constituents who are 
worried that a PPP--I mean, PPPs are hard to pencil out even in 
the most urban core. We are in the middle of trying to make 
PPPs work for our transit system, and I think there are going 
to be some instances where they make a lot of sense. But you 
are talking about a pretty disproportionate share of Federal 
and State and county money going in and then the private sector 
coming in and sort of topping it off by saying, listen, we will 
build a parking lot adjacent and that parking can be used for 
shopping and a movie theater, as well as transit. It does not 
pay for the transit. And that only pencils out when you have 
got the body heat, when you have got the density.
    So what do you say to people who live in wherever it is, 
Maine or Hamakua on the Big Island, and none of that is going 
to pencil out? And I am really worried that to the extent that 
an infrastructure package is predicated on that, that it is not 
really an infrastructure package. What would you say to that?
    Secretary Chao. We are not yet ready to reveal or to unveil 
what the administration is saying. But let me say this, that we 
are hearing the will of Congress. We understand the concerns of 
rural America. I come from a rural State. So I certainly am 
concerned about that as well. So there will be a title and a 
certain percentage of funds dedicated to rural America. There 
have been some numbers tossed around. I do not want to say how 
much yet, but it is not an insignificant amount.
    Senator Schatz. And on TIGER grants, I wanted to follow up 
on the fiscal year 2017 omnibus, which appropriated $500 
million. The Department has not yet published a notice of 
funding availability. Do you know when this will be published? 
I can take that for the record if you do not know that off the 
top of your head.
    Secretary Chao. Actually I think it has come out. This is 
TIGER?
    Senator Schatz. Yes.
    Secretary Chao. Yes. I think it should be coming out pretty 
shortly. We understand the eagerness of everybody. We need to 
get people working on this.
    Senator Schatz. There are 6,900 applicants that did not get 
it and they are ready to go again.
    Do you plan to change any of the eligibility criteria?
    Secretary Chao. The TIGER grants.
    Senator Schatz. Yes.
    Secretary Chao. I do not think so.
    Senator Schatz. Thank you.
    And my final question is on Safe Streets. During your 
confirmation hearing and in our private conversations, we 
talked a lot about Safe Streets. There is a provision that I 
worked on with Senator Heller to get local departments of 
transportation services and State departments of transportation 
to integrate that kind of thinking. As you know, it causes me 
great distress that this is somehow viewed as anti-automobile. 
It is as simple as keeping kids and the elderly safe. Everybody 
is both a pedestrian and the operator of a vehicle. Or not 
everybody but many of us are. And we all want to have an 
integrated transportation system that is as safe as possible. 
So if you can give me any update on what the Department is 
doing along those lines, I would appreciate it.
    Secretary Chao. AV policy is obviously very important, 
artificial intelligence, autonomous vehicles. We understand the 
very special role that the Federal Government plays in leading 
the way on this. We want to maintain innovation, creativity, 
also address concerns about safety, security, privacy. So we 
hope to have an Under Secretary on board pretty quickly who can 
kind of help with all of this stuff and work with NHTSA on it 
as well.
    Senator Schatz. So do I.
    And just a final comment on that. AV and AI and all of that 
is really important, but there are some low-tech solutions that 
can be adopted right away to keep people safe. Thank you.
    Secretary Chao. Thank you. We look forward to working with 
you on that.
    Senator Schatz. Thank you.
    Senator Collins. Thank you.
    Senator Durbin.
    Senator Durbin. Thanks, Chairman Collins and Ranking Member 
Reed.
    Madam Secretary, it is good to see you. I have a great list 
of questions here, and they have all been asked. So I will try 
to maybe branch into a new topic or two and get your thoughts 
on it.
    A lot of concern across America about self-driving cars, 
self-driving trucks, what it is going to do to the economy and 
American jobs. What do you think our Federal concerns and 
policies should be when it comes to this new development that 
appears--well, I know it is here because I have been in the 
Google car on a California expressway.
    Secretary Chao. As a former Secretary of Labor, I feel this 
issue very intensely. And I want to believe and I hope to give 
hope to those that the new technologies will beget its new 
jobs, its new generation of jobs. But the transition of people 
from now to then is going to be very--I believe could be very 
difficult.
    So we actually have been thinking about ways in which we 
can address the worker dislocation. And we have actually talked 
and I have not even talked to Secretary Acosta about this, but 
we hope to work with the Department of Labor on ways in which 
we can find some ways to address the worker dislocation issues 
with autonomous vehicles, artificial intelligence.
    Senator Durbin. Is there anything--any new challenges 
presented by this phenomenon?
    Secretary Chao. I think there are benefits too.
    Senator Durbin. Pardon me.
    Secretary Chao. There are benefits too. I am glad you 
called them self-driving cars because using the word 
``driverless'' cars, as some people do, actually creates fear. 
And the consumer, rider acceptance of autonomous vehicles is 
something that I think those in the field need to address in 
Silicon Valley, auto manufacturers. The acceptance of self-
driving cars is not there yet.
    Right now, Ford and General Motors, Chrysler, they can all 
work with a level 2 car. There are other organizations in 
Silicon Valley that are working on--like Google and others, 
Tesla. They are working on level 4, level 5. Self-driving cars 
in many ways can be such a benefit to the disabled, to the 
senior, to the elderly, those who cannot have mobility on their 
own. So there are benefits. And how do we move into this brave 
new world to take care of those who may be having a hard time 
transitioning as well?
    Senator Durbin. We have had some fierce debates even in 
this subcommittee about some basic issues concerning interstate 
commerce, the length of trucks, for example. We debate that 
every once in a while. So do you see us as a government looking 
at the actual functioning of these self-driving cars and 
trucks, the computers that are running them, the standards that 
they have to meet in terms of safety? Do you see a new era of 
Federal responsibility in this?
    Secretary Chao. I do not know yet. We are looking at all of 
that. But the patchwork of State regulations that are arising 
concern me deeply. And so we need to address these issues 
pretty quickly. We have a new book of guidelines for autonomous 
vehicles that is coming out probably by fall because the 
technology is changing so rapidly, things are changing so 
rapidly. The booklet came out in September of 2016, which was 
done 2 years ago, and we are going to have to just revamp it 
again. It will come out in September hopefully.
    Senator Durbin. Are any other countries ahead of us in 
terms of thinking about this phenomenon and integrating it?
    Secretary Chao. Well, Australia to name one country and 
other countries are much freer and more flexible in allowing 
these self-driving cars, vehicles to experiment, to have a 
testing ground. We have 10 testing grounds here in the United 
States. We have a lot of rules and regulations. And while many 
States want to be designated as a testing ground, because it is 
something they rightfully should be proud of, many actually 
owners, operators of autonomous vehicles are actually going 
overseas and testing their vehicles overseas.
    Senator Durbin. Let me close by saying I am for TIGER 
grants. I am for long routes on Amtrak. I am for transit 
grants. And I just wanted to leave that on the record.
    Thank you for testifying.
    Secretary Chao. Thank you.
    Senator Collins. Thank you very much, Senator Durbin.
    Senator Murray.
    Senator Murray. Well, thank you very much, Chairman 
Collins, Ranking Member Reed. I want to thank both of you for 
the tremendous job you are doing on moving this bill forward, 
and I appreciate all the work you are doing, obviously, always 
have been.
    I do have to reiterate what I said at full committee this 
morning. I am deeply concerned that we do not have a budget 
agreement and allocations across the board yet and what impact 
that will have as we move forward. But I know you guys are 
working really hard to put this one together.
    But to Congress, we have got to have our allocations. We 
need to know what we are doing. September is coming on us fast, 
and if we do what we have done in the past, which is to work 
together in a bipartisan way and fair budgets that take into 
account both domestic and military priorities will help both 
this subcommittee and all of our subcommittees and avoid those 
poison pill riders. We will get this done in a timely fashion. 
And I know both of you know that. Thank you.
    Madam Secretary, thank you for being in front of us. I 
reiterate what I know has been a big discussion today on both 
CIG grants and TIGER. And I want to thank the chairman and 
ranking member for really pushing you on that because these are 
so critical to so many of our communities. As you know, when I 
talked to you earlier this year, I was deeply concerned that 
the budget really punished a lot of our communities that had 
put forward levies and taxed themselves based on the fact that 
they believed there was going to be a Federal partner. And I 
think we have a responsibility to commit to that.
    And I know you did to both the chairman and ranking member 
earlier, but I wanted to specifically ask you again about the 
Lynnwood Link extension, which this Congress funded with $100 
million. I do understand you are waiting for them to put the 
final proposal in front of you. But my understanding is you 
committed to Senator Reed that when those are in front of you, 
as we have funded, that you will sign those and get those 
moving. Is that correct?
    Secretary Chao. Let me review that again. Did I promise 
that when I met with you?
    Senator Murray. No. We talked about the program in general. 
I understand that you said the CIG projects that are in the 
pipeline, that you will be moving on those this year. Is that 
correct?
    Secretary Chao. Yes. If the funding came in in 2017, we 
will give it out. Obviously, the 2018 situation will become 
more tenuous, but that unfortunately is the risk of the 
project, the project sponsors, or whoever. But whatever is 
given to us, we will, of course, be distributing it.
    Senator Murray. Okay. That is what I wanted to ask you.
    On a separate topic altogether, I just wanted to share with 
you that a constituent of mine recently and very bravely told 
me about being sexually assaulted on a long-distance flight. 
And she shared that when she reported it mid-flight, she was 
given a new seat, but before they landed was told she had to go 
back and sit next to her attacker. And later she found out that 
there was never any kind of official report that was filed.
    So my office has been looking into this, and I am really 
concerned that not only is sexual assault and sexual harassment 
happening on planes, but there is really a serious lack of 
guidance on adequate responses to in-flight sexual assault.
    I have been working with my colleague, Senator Casey, on 
legislation now to develop and institute some better training 
and reporting and data collection. But I just wanted to, while 
you are in front of our committee today, ask you if you will 
commit to working with us so that flight crews know what they 
need to do, people who have been assaulted, survivors, can 
properly respond and know that there is something there that 
they can count on.
    Secretary Chao. This was brought to my attention just 
before the hearing started. Of course, I will work with you on 
that.
    Senator Murray. Very good. I appreciate that.
    And finally, like everyone else, I just want to mention 
TIGER. This is so important. We have been very successful in 
this committee working with past administrations to award TIGER 
grants that many of our communities rely on. And as Chairman 
Collins said, we are not anywhere close to meeting the demand 
out there, but there is real demand. And I know that Senator 
Schatz asked you about the process, but my understanding is 
that we have been told for weeks now that we are going to be 
told that the grant process is starting. It has not happened 
yet. So you said shortly. Is that shortly like in days or weeks 
or months that the grant process----
    Secretary Chao. I will check on that for you. My 
understanding is at the end of the month it is coming up.
    Senator Murray. The end of July.
    Secretary Chao. But we understand the tremendous concern of 
Congress on this. So we are trying to get them out as quickly 
as possible.
    Senator Murray. All right. We will be following up with you 
on that.
    Thank you very much, Madam Chairman. I really appreciate 
it.
    Senator Collins. Thank you, Senator.
    Madam Secretary, given your extensive background in the 
maritime industry as Deputy Administrator of the Maritime 
Administration, I know that you appreciate and understand the 
importance of our Nation's maritime academies. As I mentioned 
in my opening statement, training vessels owned by the 
Department of Transportation are leased to the State academies 
to provide necessary training to students. And the oldest of 
these training vessels, the Empire State, is 56 years old, and 
it will no longer be in service after 2019.
    This committee provided $11 million over the last 2 years 
for the design and planning of a new national security multi-
mission vessel. Yet, the budget proposal fails to include any 
funding or provide any kind of plans for training at the 
academies after these vessels are no longer useful or, better 
yet, giving us a plan for replacing them since while the New 
York vessel may be the oldest one, Maine is coming right up 
after that.
    Given the long lead times required to construct a new 
vessel or even to rehabilitate an older one, it is critical 
that decisions be made pretty quickly on how to proceed. Do you 
have any kind of timeline that you could share with us on a 
realistic plan for replacing these vessels?
    Secretary Chao. As we have discussed, I am very concerned 
also about the plight of these six State academies' ships and 
also King's Point as well. So I have actually asked the 
Maritime Administration to come up with a plan on how we can 
fund it.
    But having said that, I do not want to lead us into any 
thinking that this will be easy because each vessel will cost 
about $300 million newly built. If it is a refabricated or a 
foreign-built vessel that came into the American flag that 
could probably be about $150 million. So right away, the 
numbers add up quite a bit.
    So let me assure you that I am concerned about the issue, 
and we are trying to find different ways of finding the monies 
of addressing this issue.
    Senator Collins. Thank you. I know that you understand the 
problem well.
    Madam Secretary, one aspect that distinguishes the United 
States from every other air system in the world is our vast 
general aviation network. Three-quarters of all general 
aviation operations in the world take place right here in the 
United States. General aviation is also an enormous economic 
driver by employing more than 1.1 million people and 
contributing more than $200 billion in economic activity.
    I am concerned that the administration's air traffic reform 
proposal will limit the access that our small communities and 
general aviation users currently have to our air traffic 
system. General aviation access to airports has significantly 
decreased in privatized systems in other parts of the world. 
Since an ATC corporation would operate as a business, my 
concern is that it would likely reduce access and thus suspend 
investments at these airports in rural America.
    What guarantees can be provided to ensure continued open 
access to our national air space system so that smaller 
communities and airports and general aviation are not left 
behind?
    Secretary Chao. In the House version of the air traffic 
control modernization, Chairman Schuster's committee--his bill 
basically eliminates user fees for general aviation. So we are 
very much aware that general aviation is concerned about user 
fees and access. And we have been working with the general 
aviation groups and we will continue to do so to assuage their 
concerns about inability to have access or to have user fees 
because in Chairman Schuster's bill, basically there are no 
user fees. Everything is funded by the gasoline tax, aviation 
tax, gasoline tax.
    But let me say that our current system is taxed by 
increasing demand, more freight, and more passengers. And to 
maintain the safety of the system, everything is slowing down 
because we have to keep the planes further apart. So some 
routes are now taking 20 minutes, half an hour longer than they 
should be. And we are all familiar with the delays and the 
sitting on the tarmac issues. And I will look at the study that 
you mentioned, but this is not a 21st century air traffic 
control system. They are still using radars, not GPS. So a 
radar sweeps a plane every 6 seconds. A plane travels 1 mile 
every 12 seconds. So for 6 seconds, you do not know where that 
plane is. To compensate for that our system, air traffic 
control system, currently spaces the planes further apart to 
accommodate for that. So the equipment in the air traffic 
control towers are 1960s technology, and in a digital age, we 
have just got to enable the air traffic control system to have 
better equipment.
    And we know that the model of a nongovernmental kind of a 
co-op structure works because they work in 50 other countries. 
And in particular, our neighbor to the north has actually seen 
decreases in GA user taxes.
    So FAA will continue to regulate safety, noise, and all 
these other very important issues. Congress will continue to 
have its oversight, just as it does over defense contractors or 
others providing public services. But I think we need to have a 
different way of handling this because every Secretary that I 
know of has been hauled up before Congress to talk about the 
air traffic control issue. And 28 years ago when I was Deputy 
Secretary, this issue was still alive about how FAA can get the 
most up-to-date technology.
    Now, there was legislation that gave the FAA the 
flexibility not to go by the Federal procurement, but that is 
not being utilized because of fears of litigation. We are still 
following government procurement rules. So by the time we 
follow the government procurement rules and get the equipment, 
it is already not the most up-to-date, state-of-the-art 
technology.
    So nothing will change in terms of physical movement. This 
is a governance change to ensure greater ability for general 
aviation and others to have control over the national air 
space. So there will be a board. General aviation will have two 
seats on that, as will the airlines, as will airports, the 
unions. So it will be a self-governing board.
    But the major issue is that this is not the best 
technology. So I will take a look at that study that you 
mentioned, but because of the technology using radar, we have 
to space the planes further apart.
    Senator Collins. Senator Reed, let me just very quickly say 
that NextGen I believe has made a big difference. We have been 
investing in it year after year after year. And the procurement 
flexibility--it is my understanding OMB has been the problem on 
that. So maybe that is something we can jointly pursue.
    Senator Reed.
    Senator Reed. Thank you, Madam Chairman.
    A few issues on airline consumer protections which are 
pending. There is some legislation here in the Senate that 
would try to deal with overbooking of flights and their impact 
on airline passengers. Are you looking at this issue, and if 
you are, can we expect some comments from your office and a 
proposal to deal with it?
    Secretary Chao. We are looking at it. Of course, because of 
what happened on United Airlines, no passenger should be 
treated like that.
    So we have an office, the Department's Office of Aviation 
Enforcement and Proceedings within the Office of General 
Counsel. They have undertaken an investigation. I have been 
briefed on it, as has the senior staff. It has not yet been 
released, but it will be shortly. We are very concerned about 
this issue.
    Senator Reed. In the FAA Authorization Act of 2016, there 
were two requirements for final rules. In fact, they were 
required to be completed this week or very shortly. One was 
with respect to the requirement to refund baggage fees for 
baggage delayed over 12 hours, and the second was to require 
air carriers to provide adjoining seats for families with 
children under the age of 13. Any status report on those rules?
    Secretary Chao. Unfortunately, I do not have that ready, 
but I will certainly get the answers for you.
    Senator Reed. Thank you very much, Madam Secretary.
    As the Chairman pointed out, Secretary Chao, we are also 
particularly concerned, as you are, about the sexual assault 
and abuse issues at the Merchant Marine Academy. I know your 
predecessor had an action plan. One of the elements, though, 
was direct involvement. Are you personally receiving updates 
from the superintendent about----
    Secretary Chao. I am. In fact, I went up to King's Point 
not only to give the commencement address on June--I think it 
was--17th, but also met with the alumni groups and met with the 
superintendent and the acting Maritime Administrator.
    Senator Reed. Thank you very much.
    Secretary Chao. We have also been receiving updates 
throughout.
    Senator Reed. And that is on a frequent, regular basis?
    Secretary Chao. On a regular basis. Frequent, yes, more 
than any other Secretary probably.
    Senator Reed. Thank you.
    Also I commend you because you have requested in the fiscal 
year 2018 budget a new position at the academy for a lawyer who 
will be dedicated to providing counsel and assistance to 
victims. Do you have to wait for the fiscal year 2018 
appropriation, or could you do that now with resources?
    Secretary Chao. We will take a look at that.
    Senator Reed. Thank you very much.
    Finally, again, let me commend you because of not only what 
you said in terms of your closing statement on cooperating with 
the committees but also your past leadership at the Department 
of Labor. It has been a pleasure working with you on a totally 
bipartisan basis.
    But I just wanted to be sure that you indicated you will 
respond to requests for technical assistance from both sides of 
the aisle. Does that apply to information requests too?
    Secretary Chao. Absolutely. I think there has been some 
miscommunications about what oversight means. So a lot of this 
also depends on the White House, but it has always been my 
practice that whatever we can offer and respond to, we 
certainly will.
    Senator Reed. Well, under Senator Collins' leadership, we 
have approached this on a very bipartisan basis, and we would 
like that same approach going forward. And thank you for that 
affirmation. Thank you very much.
    Senator Collins. Thank you, Senator Reed.
    Senator Boozman.
    Senator Boozman. I really do not have a question, but I 
really enjoyed the exchange with you and Senator Durbin about 
the--what did you call them--versus driverless cars. The 
driver-assisted cars or whatever? The technology there that is 
on us. It is something that we really need to think about. It 
is obvious that you have been thinking about it, and you got a 
lot on your plate. So I was impressed with the fact. We could 
throw drones into that. There is so much of this stuff going 
on. The ability to hack into that, perhaps weaponized a car 
sadly in the world that we live in. So I think that is 
something that the committee is ready and able to help you 
with, but probably we do need to put that on an agenda and all 
of us start working in that direction, trying to figure out the 
regulatory atmosphere and things. So, again, I appreciate the 
fact that you are well aware of it and seem to be maybe ahead 
of some of the rest of us.
    Secretary Chao. Not at all. We look forward to working with 
you. In fact, we are putting together an AV policy, kind of a 
task force and working group on this. So we look forward to 
working with all of you.
    Senator Boozman. Thank you very much.
    Senator Collins. Thank you, Senator.

                     ADDITIONAL COMMITTEE QUESTIONS

    Madam Secretary, I know there will be additional questions 
for the record from members who were unable to be here, as well 
as from us. I appreciate very much your being with us today. We 
look forward to working with you as the appropriations process 
proceeds.
    The hearing record will remain open until next Friday, July 
21st, 2017.
            Questions Submitted by Senator Susan M. Collins
                        remote tower technology
    Question. Madam Secretary, as the FAA continues its efforts to 
modernize our air traffic control system, I wanted to call your 
attention to the remote tower technology systems that have been 
successfully deployed in Sweden, Norway and Ireland. Remote towers 
offer a cost effective method of providing air traffic control tower 
services at airports that are currently operating without a tower.
    Madam Secretary, recognizing that safety is the highest priority of 
the Department, will you work with us to help advance remote tower 
technology which holds great promise for improving the safety and 
efficiency at our airports?
    Answer. The FAA remains committed to the safe and thorough 
evaluation of remote tower systems and recognizes the efficiency, 
value, and cost-saving potential these systems present for airports 
within the National Airspace System. To that end, the FAA is evaluating 
two distinct remote tower systems that have been installed at airports 
in Leesburg, Virginia, and Fort Collins, Colorado. These evaluations 
seek to identify potential performance standards as well as levels of 
service that remote towers could offer airports based on their 
individual characteristics, such as number of operations, size, and 
capacity. Throughout all phases of these two efforts, the FAA has 
applied and adhered to the Safety Management System policy and has 
conducted all testing in an effort to determine the level of operation 
a remote tower system may be capable of meeting. The results of FAA's 
Safety Risk Management process will be available in early 2018.
    Question. One of the programs that could greatly benefit from the 
deployment of remote tower technology is the FAA's contract tower 
program. As you well know, the contract tower program is a cost-
effective program that has provided air traffic control services to 253 
general aviation and small commercial air service airports across the 
country. Unfortunately, since 2014 there has been a moratorium in place 
preventing new airport applicants for the full contract tower program 
or the cost-share program.
    I understand there are over 30 airports that would like to 
participate in the contract tower program. Will you look into removing 
the barriers for entry into this cost-effective program that has 
improved the safety and efficiency of hundreds of airports in small 
communities across the nation?
    Answer. The Consolidated Omnibus Appropriations Act of 2017 (Public 
Law 115-31) requires the FAA to estimate the benefit cost (BC) ratios 
of those applications that were pending as of January 1, 2016, as well 
as cost share Federal Contract Towers (FCTs) requesting updates using 
the factors set forth in the FAA report, Establishment and 
Discontinuance Criteria for Airport Traffic Control Towers (FAA-APO-90-
7). Following this direction, the FAA is evaluating the 9 candidate and 
applicant airports, and the 16 cost share airports that are pending, 
using the current BC model. The results of the model run are now in 
executive review through the FAA and Department of Transportation.
    As background, current law requires a benefit cost analysis to 
determine initial eligibility as well as periodic reviews for continued 
participation in FCT. Towers with a BC ratio greater than 1.0 are 
admitted to the program, subject to available funding. The existing BC 
methodology has remained unchanged since 1990.
    The 2008 economic recession had a dramatic impact on General 
Aviation (GA), with FAA data showing a 24 percent drop in GA traffic 
between 2007 and 2014. In order to avoid further exacerbating the 
economic downturn in the largely rural areas that have Federal contract 
towers, the FAA suspended the running of all BCs for current FCTs in 
2008, and has not accepted any new applications to the program as of 
2014. The agency has used the time during the suspension to investigate 
whether the safety and efficiency benefits at low activity towers have 
changed, and is in the process of preparing new BC guidance that takes 
into account the best estimates of costs and benefits of having a tower 
at an airport.
    In order to remove the moratorium and address the needs of the 
airspace system while effectively utilizing our resources, the FAA is 
continuing work on new guidance that uses the most recent safety, 
economic, and operational data available and that will take into 
account the safety and efficiency changes that have occurred since the 
last guidance update in 1990. The FAA remains regularly engaged on this 
issue with our stakeholders such as the U.S. Contract Tower Association 
(USCTA) and airports that have expressed interest in joining the 
program. Once complete, the public will have an opportunity to review 
and provide comments on the guidance as well as the safety and 
efficiency studies used as the basis for the new guidance. We currently 
project that this will occur in the next fiscal year. As soon as the 
new guidance is reviewed by the public and proceeds through the 
executive review, it will be used in an updated model to allow new 
applicants to proceed with a BC necessary for admittance into the FCT 
Program.
                                 ______
                                 
          Questions Submitted by Senator Shelley Moore Capito
                             yeager airport
    Question. Since the collapse of the Runway Safety Area at Yeager 
Airport on March 12, 2015 could you summarize the efforts of the DOT 
and FAA to assist the Airport in rebuilding?
    Answer. Since the collapse of the Runway Safety Area at Yeager 
airport on March 12, 2015, the FAA Office of Airports has worked 
closely with the airport management team to develop alternatives to 
rebuild the Runway Safety Area. Our efforts have focused on providing a 
solution with appropriate safety enhancements, while maintaining 
adequate runway length to accommodate the needs of commercial carriers. 
We have provided expert analysis and feedback to airport officials, 
specifically for aircraft operational requirements and Runway Safety 
Area design standards. Airport management is refining a preferred 
alternative, including preparing a schedule for project development and 
construction. We evaluated this alternative to identify which portions 
of the project can be immediately scoped and considered for funding 
this fiscal year. Based on this work, a fiscal year 2017 Airport 
Improvement Program (AIP) grant for the initial phase of the Engineered 
Materials Arresting System (EMAS) reconstruction has been initiated and 
is proceeding through the review process.
    Question. It is my understanding the airport and FAA are working on 
an interim runway safety plan which will include a retaining wall and 
engineered materials arresting system (EMAS) bed. What actions can the 
DOT and FAA take to immediately expedite the construction of the wall 
and EMAS bed?
    Answer. Yeager Airport officials are currently finalizing their 
Interim Runway Safety Area (RSA) study. Any proposed project will 
provide the same level of safety that existed before the embankment 
failure, while maintaining adequate runway length for commercial 
operations. A preferred alternative is being refined and finalized, and 
the FAA is working with airport officials to develop a schedule for 
project development and construction. Based on this work, a fiscal year 
2017 Airport Improvement Program (AIP) grant for the initial phase of 
EMAS reconstruction has been initiated and is proceeding through the 
review process.
                                 ______
                                 
              Questions Submitted by Senator Steve Daines

    Question. Secretary Chao, thank you for testifying and providing 
justification for President Trump's budget request. Montana's extensive 
transportation system is a pillar of our economy, allowing residents, 
visitors, and freight to traverse our vast state. The U.S. Department 
of Transportation (DOT) plays a critical role in this infrastructure. I 
look forward to hosting you in Montana, hopefully this August, so you 
can see it first-hand.
    I chair the Senate Western Caucus and we have drafted a whitepaper 
for the Administration on rural infrastructure. I expect to have it to 
the President next week. We have concerns that an over dependence on 
private financing will marginalize rural communities and their 
contribution to the economy.
    In your testimony, you mentioned prioritizing projects with the 
greatest value to Americans. Rural infrastructure does benefit the 
nation. However, urbanites can overlook it. For example, nearly $500 
billion of our nation's GDP comes from farming and forestry--this comes 
from rural American. We have to get these goods to market. How does the 
budget proposal ensure rural America continues to receive its share?
    We continue to hear the statistic that only one-fifth of 
infrastructure funding comes from the Federal government. Looking at 
all infrastructure spending, nationally, this is true. Narrowing in on 
transportation in rural states, it is not the case. In Montana, over 88 
percent of our transportation infrastructure funding comes through the 
Federal government. Rural states are naturally concerned. The 
President's budget request of $200 billion for infrastructure specifies 
a set aside for rural infrastructure over the next decade. How do we 
provide certainty to rural states that they will have resources in the 
long-run to build and maintain infrastructure?
    Answer. Rural communities are an essential part of our country and 
economy, and both infrastructure and transportation access programs are 
essential to ensuring that these vital communities are fully connected 
to the larger economy.
    The fiscal year 2018 President's Budget continues multiple surface 
transportation formula grant programs authorized in the multi-year FAST 
Act that ensure largely rural states such as Montana continue to 
receive their share of infrastructure funding. Additionally, the fiscal 
year 2018 budget request works to reform transportation access programs 
to ensure the programs operate efficiently and are sustainable for 
future generations.
    Question. In recent years, there has been an increase in use of 
Highway Trust Fund (HTF) dollars on non-transportation, ancillary, 
projects. With regards to the infrastructure budget request, how will 
DOT ensure states have flexibility to meet their needs while also 
ensuring the funds are focused on core infrastructure projects?
    Answer. The fiscal year 2018 Budget request provides States and 
localities flexibility to invest in the projects that best meet local 
needs while improving the performance of the national infrastructure 
network. Beyond the Budget, the Administration looks to further target 
Federal investments through the President's Infrastructure Initiative.
    Looking forward, the President's Infrastructure Initiative will set 
forth another key tool for targeted investment in critical 
infrastructure, including transportation projects. The Initiative will 
include a combination of new Federal funding, incentivized non-Federal 
funding, and newly prioritized and expedited projects, with the goal of 
$1 trillion in infrastructure investment. One central principle of the 
Initiative will be targeting Federal dollars toward projects that are a 
high priority from the perspective of a region or the Nation.
    Question. Over 14,000 Montanans work in the energy sector. I am 
working to expand production and these good paying jobs. While private 
financing for many aspects of infrastructure aren't viable, it is 
appealing for energy related infrastructure, such as pipelines and 
rail. Without sacrificing public dollars for public infrastructure, how 
do we enable private dollars to go farther for private infrastructure 
that benefits the common good?
    Answer. The Department of Transportation, through the Pipeline and 
Hazardous Materials Safety Administration (PHMSA), is committed to 
supporting the Administration's infrastructure and rebuilding America 
initiatives.
    Throughout the U.S., new pipeline projects are being built to carry 
energy products and support the nation's energy production and energy 
export growth. PHMSA understands the importance of the construction of 
new and expanded U.S. pipeline infrastructure. PHMSA will expedite 
construction-related special permit applications and requests, for 
technical assistance from States and other Federal agencies, to promote 
the construction of private pipeline infrastructure and the good jobs 
they create.
    Further, as part of its plan to continue to proactively communicate 
with pipeline operators regarding new construction projects, PHMSA is 
designating a construction coordinator in each of its five regions to 
serve as a single point of contact for pipeline companies. The 
individuals serving in this capacity will facilitate clear 
communications and transparency before and after construction. This 
will help these projects develop quickly and safely, enabling private 
dollars to go further for private infrastructure development.
    Likewise, to help meet the needs of the energy sector, the Railroad 
Rehabilitation and Improvement Financing (RRIF) Program can provide 
loans and loan guarantees to finance railroad infrastructure to 
qualified borrowers. These direct loans can fund up to 100 percent of a 
railroad project with repayment periods of up to 35 years and interest 
rates equal to the cost of borrowing to the government. This can be an 
attractive option for energy-related infrastructure being constructed 
by railroads, state and local governments, government-sponsored 
authorities and corporations, joint ventures with at least one 
railroad, and limited option freight shippers intending to construct a 
new rail connection.
    Question. The President's budget proposes eliminating all Federal 
support for Amtrak's long distance trains. This would have a 
detrimental impact to 12 communities along Montana's Hi-Line connected 
by the Empire Builder. The House's appropriations bill preserves this 
funding. I expect the Senate will do the same. How will you support 
implementation of the funding Congress provides and ensure continuity 
of passenger rail services?
    Answer. The fiscal year 2018 budget request's proposal to re-
evaluate Federal support for long distance trains will allow the 
Department to allocate limited resources in areas where passenger rail 
makes sense now. DOT continues to offer other programs that support the 
transportation access needs of rural and remote communities.
    The Department will execute and allocate appropriated funding in 
accordance with enacted bill language.
    Question. In your testimony you touched on Essential Air Service 
(EAS). I appreciate your recognition of how important this program is 
to rural communities. Seven communities in Montana are connected to the 
national air system because of EAS. You are right, we need to reform 
the program, to ensure its sustainable, but without reducing necessary 
connectivity.
    Existing law has financial parameters in place. If routes are 
unsustainably expensive, the service is cut. In recent years, Congress 
has passed variety of distance, subsidy caps, and cost-share 
requirements. How would the President's proposed program build on these 
efforts?
    Answer. The Essential Air Service (EAS) program has been important 
to its stakeholders because it has provided a link to the national air 
transportation system for many small communities. However, over the 
years, the EAS program has drifted away from its original purpose of 
subsidizing transportation access for truly remote communities.
    The lack of appropriate sized aircraft and qualified pilots, 
coupled with an oversubscribed waiver process, have made the program 
inefficient. As a result, program costs have ballooned in excess of 150 
percent over the last 10 years, subsidizing numerous localities that 
have access to major airports close in proximity. Under the President's 
fiscal year 2018 budget, overflight fees will fund a new Transportation 
Aviation Assistance to Remote Areas (TAARA) program. The TAARA program 
will continue the original intent of the EAS program by focusing on 
transportation assistance for communities demonstrating the greatest 
need.
    Question. I continue to hear concerns from several businesses and 
industries both in Montana and nationally about implementation of the 
Federal Motor Carrier Safety Administration's (FMCSA) electronic 
logging device (ELD) rule. In light of uncertainties and questions 
around FMCSA's, law enforcement, and the motor carrier industries' 
preparedness for the implementation deadline in 5 months, will DOT work 
with all stakeholders to create certainty and give industry more time 
to comply, if necessary?
    Answer. FMCSA has undertaken an extensive outreach and education 
campaign and will continue those efforts through and beyond the 
December 18, 2017, implementation deadline. Those efforts include a 
series of online training sessions on the ELD rule, an upcoming session 
on understanding the hours-of-service regulations, a series of events 
across the country where FMCSA provides information about ELD 
requirements and compliance, and an enhanced website with outreach 
materials, questions and answers, and other pertinent information.
    To allow carriers time to adjust to the new rule, the Commercial 
Vehicle Safety Alliance, in conjunction with FMCSA, decided not to 
place a vehicle out-of-service for not having an ELD until April 1, 
2018. Therefore, a non-compliant carrier would be able to proceed 
transporting its load after an inspection until April, but must come 
into full compliance as soon as possible or risk further enforcement.
    Question. There is undoubtedly room for improvement and efficiency 
gains in our air traffic control (ATC) system. The robust debate as to 
what the ATC operating organization should look like will continue. 
Regardless of the organization, Global Positioning System (GPS) based 
ATC will improve our system. However, implementation has been slow. 
That is why I introduced the NextGen Accountability Act requiring 
tangible benchmarks and increased transparency in technology 
deployment. It has been included in the Senate's Federal Aviation 
Administration (FAA) reauthorization. As Congress continues its work to 
reauthorize the FAA, how will DOT ensure NextGen efficiency gains are 
realized?
    Answer. We are continuing to meet our near-term NextGen 
commitments, and continue to make progress addressing the Radio 
Technical Commission for Aeronautics (RTCA) Task Force and NextGen 
Advisory Council (NAC) recommendations, which focus on providing near 
and mid- term benefits to the user community. The FAA continues to 
build on the Data Communication program (Data Comm), replacing voice 
communication with advanced digital messaging between pilots and air 
traffic control towers. These services will improve safety and airport 
efficiency. We are also making a major investment in Terminal Flight 
Data Manager (TFDM), which provides the first significant change to 
airport operations. This program will reduce surface delay, taxi time, 
and fuel burn of aircraft at the airport.
    The fiscal year 2018 Budget continues to support progress on air 
traffic modernization, particularly the integration and implementation 
of advanced NextGen technologies, such as Automated Dependent 
Surveillance--Broadcasting (ADS-B), System Wide Information Management 
(SWIM), and Data Communications (Data Comm).
    Question. Nationally, 54 percent of automobile fatalities occur on 
rural roads, despite the fact that only 19 percent of Americans live in 
rural areas. There is a need here to save lives as well as an 
opportunity to improve passenger and freight mobility. Autonomous and 
semi-autonomous vehicle technology advancements will help. However, the 
quality of infrastructure as well as behavioral programs, such as 24/7 
Sobriety Program, also play an important role. An increased reliance on 
private financing would naturally shift resources to higher population 
density areas. The budget request does fully fund safety programs in 
the Fixing America's Surface Transportation (FAST) Act.
    What are your thoughts on maintaining Federal funds for rural 
safety programs after the FAST Act?
    Answer. Safety, across all modes of transportation, remains the 
Department's first priority. DOT looks forward to working with Congress 
to the next surface transportation authorization to work towards 
addressing the proportion of roadway fatalities occurring on rural 
roads.
                                 ______
                                 
              Question Submitted by Senator Lindsey Graham
    Question. Job Order Contracting (JOC) is a contracting technique 
that has been broadly used by public agencies for decades. It's a firm 
fixed-price, competitively bid, indefinite delivery indefinite quantity 
(IDIQ) procurement process that allows public facility owners to 
complete many construction and renovation projects under a single, 
competitively bid contract. Public agencies utilizing JOC programs have 
documented time savings of up to 80 percent over other construction 
procurement methods.
    The Federal Highway Administration (FHWA) has recognized the value 
of JOC in allowing State DOTs to use it for competitively bid 
construction projects. However, FHWA discourages its usage by adding 
regulatory steps before a state can utilize JOC. The multi-step process 
under the Special Experimental Projects No. 14--Alternative Contracting 
(SEP-14) program should be streamlined to allow States and others to 
rebuild and build our infrastructure. Since 1990, SEP- 14 has allowed 
Federal-aid highway fund recipients to evaluate alternative contracting 
techniques. JOC is an efficient contracting vehicle for public facility 
owners and the process for state and local transportation agencies to 
use Federal funding for JOC should be a standard procurement method.
    Congress, in fiscal year 17 THUD Appropriations, directed the FHWA 
to approve JOC's usage outside of SEP-14. Can you commit to ensuring 
this will be completed?
    Will JOC be a fully operational contracting technique throughout 
all modes within the Department?
    Answer. Absent a statutory change, FHWA cannot administratively 
approve job order contracting (JOC) outside of SEP-14 as described in 
Senate Report 114-243 (accompanying the fiscal year 17 THUD 
Appropriations Act). Although other Federal agencies have accepted JOC, 
the method remains a relatively new practice for Federal-aid highway 
projects. The inclusion of JOC as an allowable contracting method under 
SEP-14 has provided a means for contracting agencies to share and learn 
from each other's experiences.
    While the SEP-14 projects that have been approved to date have 
benefitted from competition, the procedures used are still being tested 
to assess their compliance with the competitive bidding requirements in 
Title 23. Consequently, implementation of the Senate report to make JOC 
operational could have an impact on certain segments of the contracting 
community. Given this potential impact and without clear statutory 
authority, any action that FHWA could take to approve JOC outside of 
SEP-14 would need to comply with the Administrative Procedure Act.
    Given the uniqueness of each mode regarding implementing JOC, the 
Department will work with each mode to identify opportunities for 
implementation.
                                 ______
                                 
               Questions Submitted by Senator John Hoeven
    Question. Secretary Chao, good to see you again, I greatly 
appreciated your visit to Fargo in May, and I hope you enjoyed your 
time in my state.
    Our nation's infrastructure network serves as a foundation of our 
national and economic security and competitiveness. It is imperative 
that we revitalize and maintain the roads, bridges, ports, rail, 
airports, water systems, and information networks of this country, 
enabling all industries to achieve growth and productivity that makes 
America strong and prosperous. In fact, the American Society of Civil 
Engineers (ASCE) has estimated that we need over $3.6 trillion of 
infrastructure investment by 2020 to remain competitive.
    We recently passed a 5-year highway bill, the FAST Act, which 
provides $305 billion in funding through 2020, and importantly, is 
fully paid for. I think it is vital that this committee continue to 
work to fully appropriate the amounts authorized by the FAST Act, and 
to keep our commitment to that legislation.
    President Trump has repeatedly touted his goal to invest in the 
infrastructure of the United States, and I look forward to working with 
my colleagues on both sides of the aisle to provide robust investment 
in the rehabilitation of our nation's infrastructure.
    Move America: Madam Secretary, we have spoken a number of times 
regarding the Move America Act, legislation that Senator Ron Wyden and 
I have introduced that seeks to encourage private investment in 
infrastructure by expanding private activity bonds and creating a new 
infrastructure tax credit. I was very pleased that the administration's 
infrastructure outline included in their fiscal year 18 budget proposal 
expressed support for expanding private activity bonds, which is a key 
part of my legislation.
    What do you think is the most appropriate role for the private 
sector to play in addressing our nation's infrastructure needs?
    How do you see the private sector utilizing tools, such as Move 
America, to invest in our infrastructure?
    Answer. The Department is committed to protecting the interests of 
taxpayers in the development and delivery of transportation 
infrastructure. There is a broad spectrum of opportunities for private 
investment in infrastructure and it is important to recognize that 
there is not a one-size-fits-all approach. Funding models vary with 
respect to the degree of asset ownership, development integration, risk 
transfer, extent of private financing, and types of funding sources. In 
some cases, financing may rely on a project specific revenue source, 
such as toll revenues or dedicated fees.
    Question. The Administration's Infrastructure Plan: You have said 
that the administration will release further details on its $1 trillion 
infrastructure plan later this year.
    Can you speak to the steps the administration is taking to ensure 
that rural America benefits from the plan?
    Answer. The Department is committed to ensuring transportation 
access for rural communities and remote areas, and the President's 
Budget includes dedicated funding across multiple modes. The 
President's new infrastructure initiative will provide specific 
resources targeted to rural areas.
    For highways, the fiscal year 2018 Budget proposal includes over 
$1.3 billion in dedicated funding for eligible highways, bridges, and 
tunnels existing in remote communities with populations of less than 
5,000 people. For transit, the fiscal year 2018 Budget proposal also 
includes over $645 million for the Formula Grants for Rural Areas 
program, which provides dedicated funding to transit services for 
operating and capital expenses in rural areas with populations of less 
than 50,000 people.
                       livestock hours of service
    Question. We have been working with the Federal Motor Carrier 
Safety Administration (FMCSA) to provide flexibility within the 
trucking Hours of Service regulations for truck drivers hauling 
livestock. Ranchers in my state, and throughout the country, have come 
to me with concerns that due to the unique nature of hauling 
livestock--which can include long hours during loading and unloading--
potential animal safety concerns could arise should a driver not reach 
his destination within the 11 hours of driving, and 14-hour workday 
allowed under HOS requirements.
    Recently, I worked with FMCSA to clarify their flexibility within 
the agriculture exemption. This change means that the Hours of Service 
regulations will not apply to truckers hauling livestock when their 
work is conducted within a 150 air mile radius of the source of the 
livestock. When a driver goes beyond this radius, then the hours of 
service begin to apply and the driver can drive an additional 11 hours 
during his 14 hours duty time, providing a significant extension to the 
workday.
    I greatly appreciate your department's efforts thus far to provide 
flexibility for livestock haulers--however, I wanted to follow up with 
you to see what efforts can be taken to inform the livestock industry 
of this policy interpretation. It is my understanding that many 
livestock haulers and law enforcement may not be aware of the existence 
of this exemption. Are there steps you can take to publicize this 
change?
    In the future, would FMCSA be willing to work with the livestock 
industry to address their concerns with the Hours of Service 
regulations?
    Answer. A group of DOT officials met with the Cattlemen's 
Association and the Department recognizes that livestock haulers have 
to care for their animals and cannot easily pull over to the side of 
the highway.
    Understanding this, FMCSA added certain flexibilities around hours 
of service requirements for the livestock transportation industries. 
Our recent meeting with the Cattlemen's Association went very well and 
we will continue to work with them moving forward.
                         essential air service
    Question. Your Budget proposal seeks to eliminate funding for the 
Essential Air Services program, a program that inherently benefits 
rural America, including three airports (Jamestown, Dickinson, and 
Devils Lake) in my home state of North Dakota.
    What alternative programs or initiatives does the department 
envision to foster air service to rural communities?
    Answer. Rural communities are an essential part of our country and 
economy, and transportation access programs are essential to ensuring 
that these vital communities are fully connected to the larger economy. 
In an environment of constrained funding and resources, the fiscal year 
2018 President's Budget works to reform transportation access programs 
to ensure the programs operate efficiently and are sustainable for 
future generations.
    The Essential Air Service (EAS) program has been important to its 
stakeholders because it has provided a link to the national air 
transportation system for many small communities. However, over the 
years, the EAS program has drifted away from its original purpose of 
subsidizing transportation access for truly remote communities. The 
lack of appropriate sized aircraft and qualified pilots, coupled with 
an oversubscribed waiver process, have made the program inefficient.
    As a result, program costs have ballooned in excess of 150 percent 
over the last 10 years, subsidizing numerous localities that have 
access to major airports close in proximity. Under the President's 
fiscal year 2018 budget, overflight fees will fund a new Transportation 
Aviation Assistance to Remote Areas (TAARA) program. The TAARA program 
will continue the original intent of the EAS program by focusing on 
transportation assistance for communities demonstrating the greatest 
need.
                                 ______
                                 
               Question Submitted by Senator Thad Cochran
    Question. Secretary Chao, in the 2015 Fixing America's Surface 
Transportation (FAST) Act, Congress directed the formation of the Gulf 
Coast Working Group (GCWG) to evaluate the restoration of intercity 
passenger rail service between New Orleans, La., and Orlando, Fla. The 
GCWG has recently submitted a report to Congress that indicates that 
passenger rail service can be restored to the Gulf Coast quickly and at 
a reasonable price. Given that Congress has already provided funding in 
the fiscal year 2017 Omnibus bill for capital projects that contribute 
to the initiation or restoration of intercity passenger rail service, 
what are your views on reestablishing passage rail service to the Gulf 
Coast, and how will your Department work with all members of the GCWG 
to achieve this goal in a timely manner?
    Answer. I appreciate the efforts of the Gulf Coast Working Group 
(GCWG) and the Federal Railroad Administration (FRA), chair of the 
GCWG, to fulfill their purpose to recommend possible options for 
restoring intercity passenger rail service between New Orleans, 
Louisiana, and Orlando, Florida. The GCWG report proposed 
infrastructure improvements for restoring passenger rail service from 
the perspectives of key stakeholders and highlighted additional 
information that needs to be considered before these improvements can 
move forward.
    FRA continues to work with the Southern Rail Commission on Gulf 
Coast service projects that were previously awarded. My office, and the 
FRA, will continue to work with Congress, the States, and the Board of 
Amtrak on future projects.
                                 ______
                                 
              Questions Submitted by Senator Patty Murray

    Question. President Trump's budget outlines some principles for 
your Infrastructure Initiative, calling for ``focusing Federal dollars 
on the most transformative projects'' and supporting ``projects that 
address problems that are a high priority from the perspective of a 
region or the Nation.'' I would argue that these principles define the 
successful TIGER program, which the President slates for elimination.
    TIGER encourages public-private partnerships by leveraging private, 
state, and local investments to solve complex transportation challenges 
that have regional and national significance. In fact, for every 
Federal dollar invested, an average of two non-Federal dollars go into 
a TIGER project.
    Secretary Chao, as you have heard from this Subcommittee, there is 
strong bipartisan support for TIGER in Congress. If Congress again 
disregards the President's misguided proposal to eliminate TIGER, as we 
just did in the fiscal year 2017 Omnibus, do I have your commitment to 
execute the program?
    Answer. The Department will continue to implement the TIGER Grants 
program in accordance with program provisions as authorized in statute.
    Question. As I have said many times in this Subcommittee, a budget 
is a statement of values and priorities. I continue to search for how 
the President's budget will rebuild our nation's infrastructure and 
help rural communities in Washington state and across the country. The 
budget request eliminates Amtrak's Long Distance service, cuts the 
Highway Trust Fund, significantly reduces FAA funding, kills the 
popular TIGER program, and I could go on with more. These 
infrastructure programs sustain jobs, improve efficiency, and help grow 
economies by fostering economic development. Investing in our nation's 
transportation network is essential to working families, economic 
security, and the health of urban and rural communities alike.
    Secretary Chao, what does this Administration actually support? Are 
there existing infrastructure programs which you believe should be 
continued or expanded to help local and state governments address 
challenges in Vancouver, Yakima, Spokane, and everywhere in between?
    Answer. In an environment of constrained resources, the Department 
supports a thorough review of existing transportation programs to 
ensure that funding is invested in a manner that provides the greatest 
return on Federal dollars.
    The Administration is also looking to maximize non-Federal 
investments in several ways. First, we are taking every opportunity to 
revise existing discretionary programs to ensure leveraging non-Federal 
dollars is highlighted as a key priority in the selection criteria. The 
new Infrastructure For Rebuilding America (INFRA) Grants Notice of 
Funding Opportunity that was recently published is an example of this 
Administration's commitment to broadening the Federal government's 
ability to afford more investment in infrastructure.
    Secondly, we are looking at best practices and lessons learned from 
past infrastructure investments to craft a new initiative that achieves 
innovative improvements while also retaining leverage strategies that 
have proven successful. The Department believes that awarding projects 
that leverage non-Federal sources will expand the overall pool of 
resources being used to build and restore our nation's infrastructure.
                                 ______
                                 
             Questions Submitted by Senator Richard Durbin
    Question. Secretary Chao, according to Amtrak, the Trump 
Administration's proposal to eliminate Amtrak's long-distance train 
service ``would drastically shrink the scope of our network, cause 
major disruptions in existing service, and increase costs for the 
remaining services across the system.'' Amtrak estimates that 
eliminating long distance services would result in an additional cost 
of approximately $423 million in fiscal year 2018 alone, requiring more 
funding from Congress, not less as the Administration's budget assumes. 
Amtrak operates 15 long-distance routes across the nation. These trains 
offer the only Amtrak service in 23 of the 46 states Amtrak serves. 
Additionally, eight of Amtrak's 15 long distance trains run through 
Illinois. If Congress went along with President Trump's proposal, 
passenger rail service in Illinois would be significantly reduced, 
hurting thousands of Illinois students, seniors, and rural riders, who 
depend on this service the most. For many in Illinois, Amtrak's long-
distance service provides them the only affordable access they have to 
their jobs, to their schools, to their healthcare facilities, and to 
their families. Can you explain how President Trump's proposal to cut 
this vital passenger rail service will benefit the people of Illinois, 
especially those in rural areas? Likewise, how do you justify the 
supposed savings of eliminating long-distance service in the 
President's budget when Amtrak says that eliminating that service will 
cost them an additional $423 Million in fiscal year 2018 alone?
    Answer. The Department recognizes that there are many cost, 
revenue, and operational impacts related to shutting down Amtrak's long 
distance routes. Nevertheless, funding for Amtrak's long distance 
routes do not provide the country with the return on investment we 
deserve. These trains are expensive to operate and maintain, account 
for much of Amtrak's operating losses, and carry a small proportion of 
Amtrak's ridership.
    The President's fiscal year 2018 Budget proposes to eliminate 
Federal subsidies for Amtrak long distance routes, and does not speak 
to the transition costs associated with this important action. The 
Trump Administration strongly believes that Federal investments should 
be limited to where the funding produces the most benefit. Under this 
proposal, Amtrak would be able to improve its efficiency across the 
network and focus its funding towards those investments that will 
provide the most return and value.
    Question. The President has often said that he supports increased 
investment in our nation's infrastructure. This is something that I 
agree with him on. However, the budget proposal for the Department of 
Transportation cuts transportation funding by 12 percent. Likewise, the 
infrastructure principles released by the Administration have failed to 
get at the root of the problem: the solvency of the Highway Trust Fund. 
Any serious infrastructure proposal must include a sustainable source 
of revenue for the Highway Trust Fund since the current revenues are 
not keeping up with significant infrastructure needs of the nation. The 
American Society of Civil Engineers estimates that the country faces a 
$2 trillion infrastructure gap over the next 10 years. Finding a long-
term funding solution is vital to closing that gap. To that end, I have 
been a long-time supporter of increasing the Federal gas tax. The 
Federal gas tax of 18.4 cents a gallon has not been increased in 24 
years. In the over two decades since we last increased the gas tax, it 
has lost a third of its purchasing power. Meanwhile, infrastructure 
maintenance needs have only increased. Twenty-two states have raised 
their gas taxes since 2013, but the Federal government has yet to find 
the political courage to follow their lead. Will the President support 
increasing the gas tax as part of my major transportation bill? 
Increasing private investment in our infrastructure alone will not 
solve our nation's significant infrastructure funding deficit. What 
does the Administration see as a real, sustainable infrastructure 
funding source moving forward?
    Answer. The President's Infrastructure Initiative takes a 
fundamentally different approach to how the government funds 
infrastructure. The Infrastructure Initiative will support $1 trillion 
in infrastructure investment that will be funded through a combination 
of new Federal funding, incentivized non-Federal funding, and newly 
prioritized and expedited projects.
    The $200 billion in outlays included in the President's Budget will 
be structured to incentivize additional non-Federal funding, and reduce 
the cost associated with accepting Federal dollars to further leverage 
total infrastructure spending. Programs such as TIFIA will play a key 
role in this initiative.
    Regarding the Highway Trust Fund, the Department looks forward to 
collaborating with Congress to explore all proposals that work towards 
permanent, sustainable solutions for the Trust Fund.
    Question. I was disappointed by the recent decision by the Trump 
Administration to delay the release of hundreds of millions of dollars 
in FASTLANE grants for infrastructure projects around the country. The 
FASTLANE grant program has bipartisan support and was created by the 
FAST Act to fund nationally and regionally significant freight and 
highway projects that reduce congestion and improve safety and 
efficiency. The reasoning behind the delay--updating grant criteria to 
encourage more local private funding, also makes little sense given 
that many current grant applications already rely heavily on local and 
private dollars. The application for Chicago's 95th Street Corridor 
Improvement Project, part of the larger CREATE program to decrease 
regional freight congestion in Illinois, includes a more than 65 
percent local match, contributed by the railroads and state, county, 
and local governments. However, FASTLANE grants are not the only 
infrastructure grants that this administration continued to delay. 
President Trump's budget proposal not only eliminates future funding 
for Capital Investment Grants for transit projects, The Department of 
Transportation is also refusing to release the fiscal year 2017 funding 
that was already appropriated by Congress for transit projects in the 
current pipeline. Dozens of transit projects in states around the 
country are being held up by this administration. The needless delay by 
the administration runs counter to statements made by both you and 
President Trump about the need to cut bureaucratic red tape in order to 
more quickly fund infrastructure projects. Why does the Trump 
Administration continue to hold up infrastructure funding for 
transportation projects that will create thousands of jobs around the 
country?
    Answer. Addressing our crumbling infrastructure is a top priority 
of this Administration. That is why the Department recently completed 
the development and release of a revised Notice of Funding Opportunity 
(NOFO) seeking applications for approximately $1.5 billion for the 
Infrastructure for Rebuilding America (INFRA) discretionary grant 
program. Additionally, the Department has released the fiscal year 2017 
TIGER NOFO seeking applications for approximately $500 million. The 
application period for INFRA will close on November 2, 2017, allowing 
the Department to begin its evaluation and selection process for 
allocating these important funds. The application period for fiscal 
year 2017 TIGER closed on October 16, 2017 and we are in the process of 
reviewing all application.
    In an environment of constrained resources, it becomes essential 
for the Department to step back and assess our current transportation 
programs to ensure that we are effectively and efficiently allocating 
Federal transportation dollars. The fiscal year 2018 budget request 
provides us the opportunity to pause and conduct a thorough review of 
our nation's growing transportation requirements. The result will 
provide the vital information that will help the Administration develop 
a future infrastructure bill that will meet our nation's transportation 
needs.
    Question. The TIGER program has been a great success in Illinois 
and across the country. This Committee has consistently provided TIGER 
with $500 million over the last several years. The projects funded by 
TIGER support countless jobs around the country and have expanded safe 
and reliable transportation options for millions of Americans. 
Unfortunately, despite bipartisan support in the Senate, your budget 
proposes eliminating this program. The Department of Transportation 
receives hundreds of applications for TIGER grants ever year. How will 
the Federal government meet demand for these transportation projects if 
the program is eliminated?
    Would you agree that TIGER projects support economic growth, create 
jobs, and improve mobility? How does eliminating this program make it 
easier for state and local governments to carry out these projects and 
create jobs?
    Answer. The Department takes a holistic approach when considering 
how best to make national infrastructure investment decisions. Many 
projects funded by TIGER are also eligible under DOT's other highway 
and transit formula programs. For example, the Infrastructure for 
Rebuilding America (INFRA) discretionary grant program provides DOT the 
ability to award competitive grants to projects of national or regional 
significance and is authorized at $4.5 billion dollars through 2020. 
DOT's credit and finance programs also have additional capacity for 
financing many transportation projects.
    The Department will continue to administer all Congressionally 
funded programs, including TIGER, in accordance with Congressional 
requirements.
    Question. There are numerous rural communities in the state of 
Illinois who rely on Federal support to provide residents with reliable 
and safe transportation options. One of these Federal programs is the 
Essential Air Service, which your budget eliminates. This program 
ensures rural areas in Illinois, and across the country, have access to 
commercial air services that is essential for economic development and 
access to transportation. Do you not agree that we need to take steps 
to ensure equitable access to transportation for rural communities? 
Likewise, in light of these cuts, how will the Department of 
Transportation continue to guarantee that commercial air service is 
available at rural airports?
    Answer. Rural communities are an essential part of our country and 
economy, and transportation access programs are essential to ensuring 
that these vital communities are fully connected to the larger economy. 
In an environment of constrained funding and resources, the fiscal year 
2018 President's Budget works to reform transportation access programs 
to ensure the programs operate efficiently and are sustainable for 
future generations.
    The Essential Air Service (EAS) program has been important to its 
stakeholders because it has provided a link to the national air 
transportation system for many small communities. However, over the 
years, the EAS program has drifted away from its original purpose of 
subsidizing transportation access for truly remote communities. The 
lack of appropriate sized aircraft and qualified pilots, coupled with 
an oversubscribed waiver process, have made the program inefficient. As 
a result, program costs have ballooned in excess of 150 percent over 
the last 10 years, subsidizing numerous localities that have access to 
major airports close in proximity.
    Under the President's fiscal year 2018 budget, overflight fees will 
fund a new Transportation Aviation Assistance to Remote Areas (TAARA) 
program. The TAARA program will continue the original intent of the EAS 
program by focusing on transportation assistance for communities 
demonstrating the greatest need.
    Question. Secretary Chao, the state of Illinois recently passed 
local flexibility legislation mirrored on Section 1404(b) of the FAST 
Act in order to promote local innovation and control by allowing 
localities to choose alternative federally-recognized design 
publications. This effort is stalled, however, by the Federal Highway 
Administration's cramped interpretation of Section 1404(b) as the 
agency has only accepted two publications related solely to bicycle and 
pedestrian projects. What plans do you have to fully implement this 
section so that it applies to all road projects, not just a limited 
subset, and when can we expect these additional publications to be 
recognized?''
    Answer. The FAST Act Section 1404(b) has been fully implemented. To 
be eligible for consideration under this section of the law, the local 
jurisdiction must be a direct recipient of Federal funds for a specific 
project, and the project must be on a roadway under the ownership of 
the local jurisdiction and not be on the Interstate System. The local 
jurisdiction must obtain approval from the State in which it resides to 
use a publication that is different from the publication used by the 
State. The FHWA must also recognize such publication.
    The design publications that FHWA currently recognizes are those 
listed in either the FHWA Memorandum dated August 20, 2013, regarding 
Bicycle and Pedestrian Facility Design Flexibility (available at 
www.fhwa.dot.gov/environment/bicycle_pedestrian/guidance/
design_flexibility.cfm) or the related Questions and Answers (available 
at www.fhwa.dot.gov/environment/bicycle_pedestrian/guidance/
design_flexibility_qa.cfm). The list of additional recognized design 
publications will grow as qualified local jurisdictions submit their 
requests in compliance with section 1404(b) requirements. Once these 
conditions are met, the local jurisdiction must adopt the design 
publication and ensure that designs fully comply with all applicable 
Federal laws and regulations. For other questions and answers related 
to Section 1404(b), please visit: https://www.fhwa.dot.gov/design/
standards/161006qa.cfm
    Question. Secretary Chao, FHWA Illinois Division has threatened to 
withhold Federal funds from the state of Illinois if the Illinois 
Department of Transportation tries to increase its usage of Recycled 
Asphalt Shingles or RAS in its asphalt projects. This effort by FHWA 
Illinois to maintain the status quo is refuted by years of solid 
performance and credible research showing that increased RAS usage is 
as effective as virgin materials, and it is being pushed despite the 
fact that using RAS creates Illinois jobs, keeps millions of tons of 
waste out of landfills, and saves taxpayer money without compromising 
quality. I'm interested to know if you are aware of this issue and what 
plans you have to ensure that FHWA and its division offices are working 
cooperatively with stakeholders and promoting the use of recycled 
materials in accordance with Congressional directive, FHWA policy, and 
documented research?
    Answer. Significant advances in technology over the past decade 
have increased the types of recycled/reclaimed materials used in 
highway projects. The Federal Highway Administration (FHWA) supports 
research, field trials, and project use of recycled/reclaimed materials 
if the material does not adversely affect the performance, safety or 
the environment of the highway system. A number of State departments of 
transportation have reported premature cracking in relatively new 
asphalt pavements where recycled asphalt shingles (RAS) were used to 
replace a portion of the total asphalt binder in new pavements.
    Although Illinois leads the country in RAS usage according to a 
recent industry survey, the Illinois Department of Transportation 
(IDOT) highlighted performance concerns with RAS in a July 3, 2014, 
memo stating that ``caution needs to be used when incorporating hard 
recycled asphalt binders as they contribute to brittleness and 
increased cracking''. FHWA's Illinois Division sent a letter on July 
29, 2014 acknowledging IDOTs concerns, made several recommendations to 
address the performance issues and emphasized that compliance with 
IDOT's statewide special provision on the use of RAS was necessary to 
ensure that projects remained eligible for Federal-aid funding. IDOT 
agreed with the FHWA recommendations, including the formation of an 
independent task force. Today, FHWA and IDOT continue to work together 
to monitor the performance of pavements as evidenced by the development 
of new performance testing protocols to determine the optimal use of 
recycled materials.
    Due to nationwide performance concerns with the use of RAS, FHWA 
issued a memo (https://www.fhwa.dot.gov/pgc/results.cfm?id=5614) in 
December 2014 recommending States follow AASHTO provisional standard PP 
78-14 when designing projects with RAS. When there are known 
performance concerns with the use of RAS within a State, the use of 
this provisional standard is required for Federal-aid participation. 
Provisional standard PP 78-14 has now been revised, approved by all 
States, and published as provisional standard PP 78-16.
    Question. DOT and FHWA continue to have authorities under the Value 
Pricing Pilot Program, a longstanding program originally authorized 
more than 20 years ago that allows up to 15 states to experiment with 
congestion pricing on the Interstate system. While the VPPP no longer 
offers funding to support pilot projects and studies, it does provide 
states with the ability and authority to toll the Interstate system 
when they would otherwise not be allowed to. The State of Illinois is 
one of the 15 states currently holding a slot in the program. What 
authority does DOT and Illinois have under this program? Under VPPP, 
can Illinois use their place in the program to toll an individual 
section or corridor of an interstate? Is it possible to use the VPPP to 
toll across a metropolitan area's expressway network?
    Answer. The State of Illinois holds a VPPP slot, and that slot 
allows the State to consider tolling that is in-line with the authority 
allowed under the VPPP, in essence the VPPP is authorized as a 
congestion mitigation measure. The current slot has been used to study 
peer-to- peer car-sharing.
    Occupying a slot does not grant authority to the State to toll 
under circumstances that are not directly connected to the authorities 
under the VPPP. IDOT may continue to explore how tolling under the VPPP 
will mitigate congestion on the roadways being proposed for tolling, 
but that authority can only be granted by the USDOT Secretary. Often 
State law may require the State DOT to obtain authority to toll, and 
should State law require IDOT to obtain toll authority from the 
Illinois legislature, the granting of such authority would be an 
additional requirement IDOT would need to satisfy.
    IDOT would need to submit its plan through an Expression of 
Interest (EOI) to obtain tolling authority. To implement tolling, the 
State DOT would need to enter into a cooperative agreement with the 
USDOT. FHWA staff has provided an EOI template to IDOT that can be used 
to assist them in developing their own.
    Once Illinois identifies a corridor that they desire to toll, 
complete the requirements under the VPPP to obtain tolling authority 
from the US DOT Secretary, and receive that authority from the 
Secretary, the State can implement tolling on that corridor.
    There are examples of States that obtained authority to implement a 
regional network of priced managed lanes (PML). If Illinois chose to 
pursue this congestion mitigation strategy they would need to document 
the transportation studies that outline how VPPP would be used to solve 
transportation congestion challenges in that network.
    Question. Some states are considering implementation of cutting-
edge sustainability initiatives in the development of expressways. One 
potential possibility is varying toll rates based on emissions 
standards, particularly for commercial vehicles, in order to incentive 
cleaner vehicle fleets. This concept could potentially limit or price 
the dirtiest vehicles from some highway facilities. Does DOT and/or 
states have the ability to use current authorities and pilot programs 
to restrict access to highway facilities based on vehicle emissions 
standards? Do current Federal statutes, regulations, and pilot programs 
allow for states to toll vehicles (including commercial vehicles) at 
different rates based on their emissions rates?
    Answer. The Federal-aid highway program is a federally assisted 
State program. States own and operate the highways that are eligible to 
be tolled and establish toll rates on those highways. Establishing toll 
policy and rates is not the same as restricting access. On the National 
Highway System, States may only restrict access for safety reasons.
                                 ______
                                 
            Questions Submitted by Senator Dianne Feinstein
                transit capital investment grant program
    Question. Secretary Chao, I would like to thank you for your 
decision in May to release the long- awaited grant agreement for 
Caltrain's Peninsula Corridor Electrification Project. They had to wait 
an extra 3 months at an additional cost of $15 million, but it is good 
for the country that this project is now underway.
    In the appropriations bill for fiscal year 2017, the committee 
expressed our strong commitment to continued Federal investment in 
Caltrain and in transit throughout the country. We funded 17 new 
transit projects throughout the country, and provided $700 million more 
than had been proposed by the Administration in March.
    It is my hope that you will take this as a signal of our intentions 
to continue providing funding in the years to come.

  --Will you commit to advancing transit projects through the Capital 
        Investment Grant pipeline established by statute fairly and 
        without delay?

  --Do you intend to recommend funding for the individual projects in 
        next year's New Starts report on the basis of the strong 
        Congressional consensus that exists in support of this program?

    Answer. The Department will continue to implement the Capital 
Investment Grants program in accordance with program provisions as 
authorized in statute.
    As proposed projects become ready for a funding agreement 
commitment, FTA will review current and future year funding resources, 
coordinate with the project sponsor, and determine next steps.
                cafe standards and the california waiver
    Question. I understand that the Department will soon begin work on 
establishing the CAFE fuel economy standards for model years 2022-2025.
    I worked very hard in 2007 with Senators Snowe, Inouye and Stevens 
to strengthen the statutes that govern this effort. Our bipartisan bill 
mandated an improvement of at least 10 miles per gallon over the first 
10 years, which we've done. After that, the law requires the Department 
to set the maximum feasible standards on the basis of science. This law 
marked the largest increase in fuel efficiency targets in more than two 
decades. For a time, we were on target to reach an average of 54.5 
miles per gallon by 2025.
    Are you committed to maintaining stringent fuel economy standards 
at the highest level feasible, and thereby maximizing savings for 
American drivers and minimizing greenhouse gas emissions?
    Answer. NHTSA has been, and continues to be, committed to following 
the statutory requirements in the Energy Policy and Conservation Act 
and Energy Independence and Security Act in establishing CAFE 
standards. That includes a commitment to establish maximum feasible 
CAFE standards.
    Question. The agencies completed their review of the science last 
summer. The technical assessment report found that automakers were 
outperforming the standards at lower- than-expected costs, and that 
many new efficiency technologies have become feasible.
    This was an exhaustive and honest appraisal of the data that 
brought together experts from your Department, the Environmental 
Protection Agency, the State of California, and the auto industry.
    Do you view the Technical Assessment Report as a valid appraisal of 
the science?
    Do you plan to base the regulatory effort for model years 2022-2025 
on this appraisal, or will you try to reconsider the science?
    Answer. The Draft Technical Assessment Report (TAR) examined a wide 
range of factors relevant to model years 2022-2025 CAFE standards and 
reflected data and information available at the time it was issued.
    The Department is committed to a data-driven and transparent 
process, and NHTSA will proceed through the full rulemaking process, 
including a public comment period, to establish the next CAFE 
standards. The rulemaking will consider the information in the Draft 
TAR, public comments to the Draft TAR, as well as new data and 
information that become available.
    Question. As you know, the current fuel economy standards achieved 
a consensus among the three agencies that share regulatory jurisdiction 
over this issue: the Department of Transportation, the Environmental 
Protection Agency, and the California Air Resources Board. Anything 
short of consensus this time around will surely lead to litigation and 
possibly to divergent automobile standards.
    Are you committed to working in concert with the other agencies, 
including California, to maintain their support for a strong, national 
program?
    What process have you established to achieve this?
    Have you met with the California Air Resources Board? Have your 
staff arranged regular meetings?
    What other stakeholders have you engaged?
    Will your discussions with stakeholders proceed in an open and 
transparent manner?
    Answer. NHTSA and the Environmental Protection Agency (EPA) have 
committed to coordinating NHTSA's CAFE rulemaking and EPA's 
reconsideration of the final determination for model years 2022-2025 
greenhouse gas emissions standards. In the March 13, 2017 ``Notice of 
Intention to Reconsider the Final Determination of the Mid-Term 
Evaluation of Greenhouse Gas Emissions Standards for Model Year 2022-
2025 Light Duty Vehicles,'' EPA committed to consult and coordinate 
with NHTSA's CAFE rulemaking in support of a national harmonized 
program.
    NHTSA has encouraged stakeholders to reach out to the agency and 
share data and information to inform the upcoming rulemaking analysis. 
Since the Draft TAR, a number of stakeholders have reached out and met 
with NHTSA, including automobile manufacturers, automotive suppliers, 
industry associations, fuel suppliers, academic researchers, 
environmental organizations, consumer organizations, and other 
independent non-profit organizations. NHTSA welcomes input from 
California during the rulemaking process.
    NHTSA will conduct a full de novo rulemaking to establish the next 
CAFE standards including a proposal, public comment period and a final 
rule. On July 26, 2017 in the first formal step of the CAFE rulemaking 
process, NHTSA published in the Federal Register a ``Notice of Intent 
to Prepare an Environmental Impact Statement for Model Year 2022--2025 
Corporate Average Fuel Economy Standards.'' In response to a request 
from stakeholders, NHTSA extended the comment period to September 25, 
2017 to allow additional time for comments regarding the proposed 
environmental impact analysis.
                                 ______
                                 
               Questions Submitted by Senator Joe Manchin
    Question. As a former Governor and in my role as a United States 
Senator, I have remained committed to enhancing the job climate in my 
state so that West Virginians have good paying jobs and the skills to 
compete in the global economy. My office has hosted many Job Fairs 
across the state where thousands of West Virginians have met with 
potential employers. I believe that part of this job growth is going to 
come from the manufacturing sector and we are beginning to see an 
uptick in manufacturing in different parts of the state. However, I 
believe there are opportunities to grow our domestic manufacturing even 
more through using American made products in our infrastructure 
development.
    In West Virginia, we are eagerly awaiting the details of the 
Administration's Infrastructure initiative to help us address some of 
the air, road, rail, and broadband issues that we have. I envision 
employment opportunities locally, state-wide and regionally that will 
reinvigorate our West Virginia workforce and our economy.
    What is the status of rolling out the Infrastructure Initiative?
    I understand that you cannot provide any details, but it would be 
helpful for you to provide a topline overview of what is being 
considered.
    Answer. The President's Infrastructure Initiative will support $1 
trillion in infrastructure investment that will be funded through a 
combination of new Federal funding, incentivized non- Federal funding, 
and newly prioritized and expedited projects.

The infrastructure program will address 4 key principles:

  --Target Federal investments towards the most transformative 
        projects;

  --Encourage states and localities to take their own action, with 
        Federal aid coming in terms of streamlining regulations and 
        permitting;

  --Tapping into private sector capital and management methods; and

  --Aligning infrastructure with the entity best suited for operation 
        and maintenance.

    Question. The transportation research group TRIP1 recently found 
that:
  --Driving on deficient roads cost West Virginia motorists a total of 
        $1.4 billion annually in the form of additional vehicle 
        operating costs, congestion-related delays, and traffic 
        crashes.

  --29 percent of West Virginia's major roads are in poor condition, 
        while 55 percent are in mediocre or fair condition, and only 17 
        percent are in good condition.

  --West Virginia has the nation's fifth-highest share of poor bridges, 
        with 17 percent of the state's bridges rated structurally 
        deficient.

    The story is similar throughout our nation, and the longer we wait 
to act the more difficult it becomes to invest in a responsible way. 
What are DOT's plans on ways we can meet the nation's mobility needs 
and deliver a sustainable long term funding stream for the maintenance 
of our infrastructure projects? Will the Infrastructure Initiative be 
designed to address some of these known deficiencies?
    Answer. The fiscal year 2018 Budget request provides States and 
localities flexibility to invest in the projects that best meet local 
needs while improving the performance of the national infrastructure 
network. Beyond the Budget, the Administration looks to further target 
Federal investments through the President's Infrastructure Initiative.
    Looking forward, the President's Infrastructure Initiative will set 
forth another key tool for targeted investment in critical 
infrastructure, including transportation projects. The Initiative will 
include a combination of new Federal funding, incentivized non-Federal 
funding, and newly prioritized and expedited projects, with the goal of 
$1 trillion in infrastructure investment. One central principle of the 
Initiative will be targeting Federal dollars toward projects that are a 
high priority from the perspective of a region or the Nation.
    Regarding the Highway Trust Fund, the Department looks forward to 
collaborating with Congress to explore all proposals that work towards 
permanent, sustainable solutions for the Trust Fund.
    Question. Impaired driving due to any reason is a hazard for 
drivers, passengers, pedestrians, and affects the general safety on our 
roads and highways. In the past, the emphasis was on the impact of 
drinking and buzzed driving. Now, the focus is widening to include 
impairment from drugs, whether taken over-the-counter, by prescription, 
or due to illegal use.
    Can you outline DOT's strategy to work on public education, policy, 
and other initiatives to address this growing menace?
    Answer. The Department's strategy for addressing the drugged 
driving program includes conducting research to identify the risks and 
monitor the scale of the problem, developing new tools to improve the 
effectiveness of criminal justice processes, creating educational 
materials for the public and highway safety professionals, and 
providing training and capacity-building programs for State and local 
officials to combat drug-impaired driving.

Specific examples include:

  --Conducting high-visibility enforcement efforts combined with 
        national paid advertising to increase behavior change and to 
        reduce fatalities and injuries related to impaired driving, 
        such as Drive Sober or Get Pulled Over and Buzzed Driving Is 
        Drunk Driving campaigns;

  --Developing and promoting advanced training programs on drug 
        impaired driving countermeasures for State and community 
        highway safety specialists;

  --Supporting State implementation of the Drug Recognition Expert 
        (DRE) program and training of law enforcement Drug Recognition 
        experts;

  --Developing and delivering prosecution and judicial training and 
        education about drugs and driving;

  --Promoting a specialized training course for the medical community 
        on techniques for counseling patients on the risks associated 
        with drugs and driving;

  --Developing a drug-impaired communications campaign to support State 
        efforts to raise drivers' awareness of the risks and dangers of 
        drugged impaired driving (includes all types of drugs) and 
        alcohol impaired driving;

  --Continuing research on the increased risks associated with drug 
        impaired driving and techniques to identify drug impaired 
        drivers.

    Question. Rural communities depend on the Essential Air Service 
(EAS) program to maintain connections with major airports and 
metropolitan areas. The entire spectrum of travelers, from leisure and 
tourism to business travel, depend on this accessibility.
    How does Transportation Aviation Assistance to Remote Areas (TAARA) 
differ from EAS?
    How will TAARA provide the same or better service to rural areas 
with 50 percent less funding?
    Has DOT undertaken a study to review existing authorities governing 
EAS providers to seek ways of increasing airline accountability? Will 
TAARA do this?
    Has DOT looked for new ways to incentivize more competition among 
potential providers, such as including the use of interline agreements, 
to give rural areas more choice in selecting an EAS partner? Will TAARA 
do this?
    What assurances can you provide that TAARA will not cause loss of 
access to air service to rural communities?
    Answer. The EAS program has drifted away from its original purpose 
of temporarily subsidizing commercial air service to remote communities 
adversely impacted by the 1978 Airline Deregulation Act. Each year, the 
program continues to escalate in costs. Program funding in 2007 was 
$109 million but has grown to $280 million in the last 10 years. 
Additionally, current funding is not allocated efficiently. For 
instance, current subsidy recipients include airports with only 3 
passengers landing per day.
    The President's Budget request recommends reforming the Essential 
Air Service Program at a lower cost. Several of the participating 
airports are relatively close to major airports. The President is 
asking us to go back to the drawing board and provide an alternative 
program.
    As a result, the Budget proposes the new Transportation Aviation 
Assistance to Remote Areas (TAARA) program. TAARA would be funded by 
the mandatory overflight fees that currently support a portion of the 
EAS program. The TAARA program will continue the original intent of the 
EAS program by focusing on transportation assistance for communities 
with the greatest need.
    Question. Wireless and wireline broadband deployment are critical 
drivers of our digital economy and must be included as part of any 
Infrastructure Initiative package. Federal communications policy both 
embraces and requires that rural Americans must have access to the 
economic opportunities provided by broadband deployment.
    Installing broadband conduit during a federally-funded road project 
is estimated to add around 1 percent to the overall cost and reduce 
broadband deployment costs by as much as 90 percent.
    How does DOT plan to support common sense policies that make 
broadband access and deployment costs in rural states like West 
Virginia cheaper and easier?
    Answer. FHWA encourages State DOTs to allow broadband installations 
within the highway rights of way while maintaining the safety and 
operational integrity of the facility. FHWA has published and held two 
webinars related to best practice installations within highway rights 
of way. Additionally, the FHWA reached out to each state DOT CEO 
encouraging broadband installations. For more information, please 
visit: https://www.fhwa.dot.gov/policy/otps/exeorder.cfm
    Question. TIGER Grants have provided State and Local governments 
with a great deal of flexibility to develop a number of innovative 
projects. I celebrate the program, however, will note that my own state 
of West Virginia has not been as successful in winning TIGER grants in 
recent years. Nonetheless, I do not support elimination of the TIGER 
program and instead would urge DOT to look at modifying the selection 
criteria so that rural and underserved areas can better compete for the 
benefits of TIGER grants.
    With the elimination of TIGER grants, how does DOT intend to 
provide comparable support to states and local governments?
    How do you plan to ensure that rural and underserved states, such 
as West Virginia, can benefit from these programs?
    Answer. The recently released Infrastructure for Rebuilding America 
(INFRA) Notice of Funding Opportunity provides DOT the ability to award 
competitive grants to projects of national or regional significance and 
is authorized at $4.5 billion through 2020. The INFRA notice released 
on June 29 includes several provisions that account for the unique 
needs of rural areas.
    Local entities are eligible to directly seek INFRA grants through a 
competitive application process similar to TIGER. In addition, DOT's 
credit and finance programs also have additional capacity for financing 
many transportation projects, and local entities are eligible to seek 
credit and financing from these programs.
    The Department will continue to use all Congressionally funded 
programs to meet our national infrastructure needs, in both urban and 
rural areas, as well as develop new and innovative approaches that 
improve the way transportation infrastructure projects are financed, 
developed, operated, and maintained.
    Question. The debate around the use of Public Private Partnerships, 
or P3s, is very important to my state. These contractual agreements, 
formed between a public agency and a private sector entity, allow for 
greater private sector participation in the delivery and financing of 
transportation projects.
    However, they tend to not benefit rural states like West Virginia 
and according to Congressional Budget Office in 2015, less than 1 
percent of spending on highways nationwide came from P3s in the last 25 
years.
    How will DOT ensure that rural America is able to compete on a 
level playing field if Public Private Partnerships are a component of 
our infrastructure legislation?
    Answer. The Department is committed to protecting the interests of 
taxpayers in the development and delivery of transportation 
infrastructure. There is a broad spectrum of potential opportunities 
for potential private investment in infrastructure and it is important 
to recognize that there is not a one-size-fits-all approach. The models 
vary with respect to the degree of asset ownership, development 
integration, risk transfer, extent of private financing, and types of 
funding sources. In some cases, the financing may rely on a project 
specific revenue source, such as toll revenues or dedicated fees.
    Additionally, with the expertise of the new Build America Bureau, 
the Department has the ability to help States and local governments 
understand when projects may be delivered more efficiently using a 
public-private approach. The Bureau promotes best practices in 
innovative finance and provides extensive technical assistance to 
ensure that public sector decision makers have the tools they need to 
make informed and responsible choices about all types of project 
delivery methods, including P3s.
    Question. Amtrak operates intercity passenger rail services in 46 
States and the District of Columbia. Amtrak also provides diversified 
transportation options that are important to the growth of the Nation's 
economy, especially in rural areas where transportation options are 
limited. Many of my constituents make the daily commute to Washington, 
D.C. using rail service. Reliability is important for them to get to 
work on time and to get home to their families as planned.
    These same rails carry products such as coal, steel, and 
manufactured goods from West Virginia to all points around the U.S. and 
the world. Here again, reliability is important to support rural 
businesses and local economies.
    As a voice from rural America, I implore you to consider the 
important contribution that reliable and safe rail service provides to 
local economies.
    What assurances can DOT provide that it will study the importance 
of rail service to rural America as you determine the future of long 
distance rail services?
    Answer. Long-distance rail services have proved inefficient and 
incur the vast majority of Amtrak's operating losses. The fiscal year 
2018 budget request's proposal to re-evaluate Federal support for long 
distance trains will allow the Department to allocate limited resources 
in areas where passenger rail makes sense now.
    However, DOT continues to offer other programs that support the 
surface transportation needs of rural and remote communities. The 
Nationally Significant Highway and Freight Projects discretionary grant 
program, also known as Infrastructure For Rebuilding America (INFRA) 
Grants, provides DOT the ability to award competitive grants to 
projects of national or regional significance and is authorized at $4.5 
billion through 2020. The INFRA notice released on June 29 includes 
several provisions that account for the unique needs of rural areas. 
DOT's credit and finance programs also have additional capacity for 
financing rail, transit, and multimodal projects.

                          SUBCOMMITTEE RECESS

    Senator Collins. This hearing is now adjourned.
    [Whereupon, at 3:15 p.m., Thursday, July 13, the 
subcommittee was recessed, to reconvene at a time subject to 
the call of the Chair.]