[Senate Hearing 116-343]
[From the U.S. Government Publishing Office]





                                                        S. Hrg. 116-343
 
                    MACGREGOR AND DANLY NOMINATIONS

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

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                                   to

CONSIDER THE NOMINATIONS OF KATHARINE MACGREGOR TO BE DEPUTY SECRETARY 
OF THE INTERIOR AND JAMES P. DANLY TO BE A MEMBER OF THE FEDERAL ENERGY 
                         REGULATORY COMMISSION

                               __________

                            NOVEMBER 5, 2019

                               __________
                               
                               
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                       Printed for the use of the
               Committee on Energy and Natural Resources
               
               

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                           ______

             U.S. GOVERNMENT PUBLISHING OFFICE 
 39-869               WASHINGTON : 2021 
        
        
        
        
               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                    LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming               JOE MANCHIN III, West Virginia
JAMES E. RISCH, Idaho                RON WYDEN, Oregon
MIKE LEE, Utah                       MARIA CANTWELL, Washington
STEVE DAINES, Montana                BERNARD SANDERS, Vermont
BILL CASSIDY, Louisiana              DEBBIE STABENOW, Michigan
CORY GARDNER, Colorado               MARTIN HEINRICH, New Mexico
CINDY HYDE-SMITH, Mississippi        MAZIE K. HIRONO, Hawaii
MARTHA McSALLY, Arizona              ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee           CATHERINE CORTEZ MASTO, Nevada
JOHN HOEVEN, North Dakota

                      Brian Hughes, Staff Director
                     Kellie Donnelly, Chief Counsel
                   Lucy Murfitt, Deputy Chief Counsel
                Sarah Venuto, Democratic Staff Director
                Sam E. Fowler, Democratic Chief Counsel
                
                            C O N T E N T S

                              ----------                              

                           OPENING STATEMENTS

                                                                   Page
Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska....     1
Manchin III, Hon. Joe, Ranking Member and a U.S. Senator from 
  West Virginia..................................................    16

                               WITNESSES

MacGregor, Katharine, nominated to be Deputy Secretary of the 
  Interior.......................................................    23
Danly, James P., nominated to be a Member of the Federal Energy 
  Regulatory Commission..........................................    29

          ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Alaska Federation of Natives:
    Letter for the Record........................................     3
American Exploration & Mining Association:
    Letter for the Record........................................   100
American Wind Energy Association:
    Letter for the Record........................................   101
Americans for Limited Government:
    Letter for the Record........................................   103
Appalachian Trail Conservancy:
    Letter for the Record........................................   105
Arctic Slope Regional Corporation:
    Letter for the Record........................................     5
Chamber of Commerce of the United States of America:
    Letter for the Record........................................   111
Congressional Sportsmen's Foundation:
    Letter for the Record........................................     6
Cook Inlet Region, Inc.:
    Letter for the Record........................................     8
Cramer, Hon. Kevin:
    Statement for the Record.....................................    20
Danly, James P.:
    Opening Statement............................................    29
    Written Testimony............................................    31
    Responses to Questions for the Record........................    83
Gila River Indian Community:
    Letter for the Record........................................   112
Graham, Hon. Lindsey:
    Statement for the Record.....................................    22
(The) Industrial Minerals Association--North America:
    Letter for the Record........................................    10
Irwin, Hon. Holly:
    Letter for the Record........................................   114
MacGregor, Katharine:
    Opening Statement............................................    23
    Written Testimony............................................    26
    Responses to Questions for the Record........................    63
Manchin III, Hon. Joe:
    Opening Statement............................................    16
Murkowski, Hon. Lisa:
    Opening Statement............................................     1
National Water Resources Association:
    Letter for the Record........................................    12
Public Lands Council, et al.:
    Letter for the Record........................................    13
Schumer, Hon. Charles E.:
    Letter to the U.S. Department of Energy and U.S. Office of 
      Government Ethics dated 11/4/19............................    34
Theodore Roosevelt Conservation Partnership:
    Letter for the Record........................................    14
Western Energy Alliance:
    Letter for the Record........................................   116


                    MACGREGOR AND DANLY NOMINATIONS

                              ----------                              


                       TUESDAY, NOVEMBER 5, 2019

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:03 a.m., in 
Room SD-366, Dirksen Senate Office Building, Hon. Lisa 
Murkowski, Chairman of the Committee, presiding.

           OPENING STATEMENT OF HON. LISA MURKOWSKI, 
                    U.S. SENATOR FROM ALASKA

    The Chairman. Good morning, everyone. The Committee will 
come to order. Go ahead and be seated. Today we are here to 
consider two nominees, Ms. Katharine MacGregor to be the Deputy 
Secretary of the Department of the Interior and Mr. James Danly 
to be a member of the Federal Energy Regulatory Commission 
(FERC). These are both very important positions that I want to 
thank you both for your willingness to serve today. The 
Department of the Interior is the steward of about 20 percent 
of all land in the United States, much of it in the State of 
Alaska.
    Roughly 60 percent of all National Park Service lands and 
86 percent of all Fish and Wildlife Service lands are located 
in Alaska, and that is why back home we oftentimes refer to the 
Department of the Interior as our landlord, sometimes not so 
affectionately. But it is why we depend on the Department to be 
our partner and why we look to ensure that its leadership 
understands our unique history and our needs. I have been 
encouraged by the approach the Department has taken in this 
Administration. For example, we are moving forward with the 
responsible development of a small part of the non-wilderness 
1002 Area.
    The Secretary has signed a very small but a very important 
land exchange with King Cove. And whether it is Assistant 
Secretary Sweeney or you, Ms. MacGregor, the Department has 
worked closely with us to address the crisis of missing, 
murdered, and Indigenous women. So we appreciate all of that. 
But for all the good work that has been done, we know that 
there is a lot more that remains to be done. We have to see 
greater progress in lifting the decades-old public lands 
orders. We are waiting on a revised activity plan for our 
National Petroleum Reserve-Alaska to restore balance in its 
management. It is critical that the permitting of projects on 
our North Slope, which we need to refill our Trans-Alaska 
pipeline, stay on track; we need forest management reforms to 
address the threat of wildfire and invasive species; and, of 
course, we need to continue to build safe and secure 
communities.
    I know Ms. MacGregor, you are no stranger to any of these 
issues. You have been described, as one friend from home said, 
as North Slope tough. That is a very strong compliment. You 
have served at Interior from the start of this Administration. 
You also have a decade of experience here on Capitol Hill. Your 
nomination has drawn strong support from dozens of groups from 
the Alaska Federation of Natives to the Theodore Roosevelt 
Conservation Partnership. So we will add all of those 
endorsements to our hearing record today along with the 
statement that Senator Cramer had planned to give when he was 
going to be introducing you.
    [The information referred to follows:]
    
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        The Chairman. But as you know, you also have my strong 
support.
    Mr. Danly, I also want to welcome you to the Committee. I 
am glad you are here as the seat that you are nominated for has 
now been open for more than 10 months following the tragic 
passing of former Chairman Kevin McIntyre. Everyone on this 
Committee knows that I have been urging the Administration 
since the very first of the year to address this vacancy and to 
move on it.
    So I am pleased that this time has come. You have an 
impressive academic and professional background, having served 
two tours of duty with the Army in Iraq where you received a 
Bronze Star and a Purple Heart, and played a key role in 
executing counterinsurgency efforts during the surge. We thank 
you for your service and your sacrifice to our country.
    After the military, Mr. Danly graduated from Vanderbilt Law 
and chose to pursue a very different career as a FERC attorney, 
first practicing at a major firm and now serving as FERC's 
General Counsel. During his time as General Counsel, the 
Commission has tackled key issues such as energy storage, 
infrastructure development, and reform of the Agency's 
regulations under the Public Utility Regulatory Policies Act, 
PURPA.
    If confirmed, Mr. Danly, you will need to address the many 
remaining critical issues on FERC's plate. Among these are grid 
resilience and capacity market reform, both of which are 
critical to the reliability of our nation's electricity system. 
As we have discussed in my office, Mr. Danly, you have my 
support. But before I turn to my colleague here, I also want to 
address what I expect will be the main source of opposition to 
your confirmation this morning. It is true that you are not 
paired with a Democratic FERC nominee to fill a second seat 
that just opened in August, but I hope that will not be what 
drives anyone to oppose your nomination. So just let me walk 
through the history here.
    First, FERC is set up to avoid the need for pairings. I 
think this is one of the misconceptions that has been out 
there. Back in 1990 Congress passed a law to stagger the five 
Commissioners' terms by one year each in an effort to make sure 
that we did not have these double vacancies. Second, bipartisan 
pairings are not always the norm. More often, we have confirmed 
individual Commissioners or had unbalanced pairings.
    Back in 2014, Colette Honorable moved forward with the two 
Republican Commissioners that we confirmed in 2017, after the 
Obama administration declined to nominate anyone for those 
seats. And then the third point is that this seat was already 
previously paired. In 2017 we paired Kevin McIntyre with Rich 
Glick. Rich will continue to serve through mid-2022. So the 
slot we are now considering is to fill the remainder of Mr. 
McIntyre's term through mid-2023. Then the final point is, the 
reality is we have one nomination in the Committee right now; 
we do not have two.
    We all know that an individual's name has been out there 
for some time, but we have not seen it sent up from the White 
House and sent to us for our action. And so, as people have 
asked me, well what are you going to do here with this opening 
that we have right now? We have been waiting for 10 months to 
get a name. We have Mr. Danly's name in front of us now so I do 
not think it is fair to tell the Republican nominee that we 
have to wait given that we have been waiting for 10 full months 
and recognizing that this term will end a full year earlier 
than the term for the Democratic seat. So know, colleagues, 
that when we get the Democratic candidate, we will hear that 
nomination, when we receive it, as we normally would. And if 
that individual has the support to be reported from Committee, 
we will move that individual from this Committee.
    I would like to again thank both of you for being here this 
morning. Thank you for your willingness to serve.
    And just for colleagues' reference here, we will have an 
opportunity for full questions today, but if members have 
additional questions after the hearing concludes, we are going 
to hold the record open until close of business tomorrow, 
because I know that there may be some members that are still 
traveling and I want to respect that. Let me turn to Senator 
Manchin for his opening comments.

              STATEMENT OF HON. JOE MANCHIN III, 
                U.S. SENATOR FROM WEST VIRGINIA

    Senator Manchin. Thank you, Madam Chairman. I do not think 
the microphone is working back there, right? Can you all hear 
us in the back? Is it working now? I will speak louder. Okay. 
So I want to thank you, Madam Chairman, for holding the hearing 
on these two important nominations. Ms. MacGregor and Mr. 
Danly, welcome to the Committee and thank you for your services 
and willingness to serve. I appreciate the opportunity to meet 
with each of you two weeks ago.
    I think they were very enlightening meetings. Both of you 
are extremely professional and your desire to serve is to be 
commended, as are your families for joining you today. It is 
always good to have family. No matter how things go, good, bad, 
or indifferent, they are always behind you. I understand that, 
and I am happy to have them both here.
    The job description of the Deputy Secretary is fairly 
simple. It is to help the Secretary run the Department when he 
or she is there and to do his or her job for him when he is 
not. I think we have spoken about that. In practice, that means 
that you will spend a good amount of time helping Secretary 
Bernhardt formulate and implement the Department's policies, 
but it also puts you in a unique position to help shape those 
policies and how they are implemented in the most compassionate 
way.
    It is no secret that many of these policies that Secretary 
Zinke and some of Secretary Bernhardt's have pursued have been 
considered controversial and met with opposition by some in 
Congress and by many communities across the country. If you are 
confirmed, you will be in a position to expand outreach in 
order to ensure robust engagement by all the stakeholders 
affected by the Department's actions. I urge you to make the 
most of that opportunity, Ms. MacGregor. I also see you as 
qualified to better bridge the divide between the Department 
and Congress. Lord knows we need that. You know this 
institution.
    You spent ten years working for the House of 
Representatives, including six years on the staff of the 
Natural Resources Committee, which gives you insight and 
experience. You are also clearly qualified for the position of 
Deputy Secretary, having already performed its duties for the 
past six months and having served as the Department's Deputy 
Chief of Staff for the past 15 months. Senior officials who are 
performing the duties or roles that are subject to Senate 
confirmation should be formally nominated and considered, and I 
am happy that we are starting the process for you today. I am 
pleased to support your nomination. And with that I ask that 
you commit to work with me and all of our colleagues on both 
sides of the aisle to find consensus rather than conflict in 
setting natural resource policies.
    So Mr. Danly, the position to which you have been nominated 
is entirely different from that of the Deputy Secretary of the 
Interior. I think you and I spoke about this.
    Congress established the Federal Energy Regulatory 
Commission, which we know as FERC, as an independent regulatory 
commission. Independent means that they are independent of the 
President, the White House staff, the Department of Energy, or 
anyone else in this or any other Administration when it 
administers our energy laws. It is for all the people. A 
Commissioner's job is to make independent determinations based 
on laws and facts. Congress placed the important function of 
regulating gas and electric rates, licensing hydroelectric 
projects, and natural gas pipelines, and overseeing the 
electric grid in an independent commission rather than the 
hands of a Secretary of Energy for a good reason. It wanted to 
make sure that these functions are performed impartially by 
experts following due process and free from political 
influence. It wanted to make sure that the Commission's 
decisions were made collaboratively and reflected the wisdom of 
a bipartisan group of five Commissioners.
    I have been very vocal about the importance of pairing this 
nomination with a nominee for the open Democrats seat. It is 
not the Chairman's responsibility for that, and it is not 
yours, I understand completely, and I have begged the White 
House to please do this. This is one Committee that has worked 
very well as a bipartisan committee. We have looked at the 
facts, looked at what is best for our country and our regions, 
and have been able to have input on both sides without any 
conflicts whatsoever. And to put us in a situation to where we 
can have a conflict and it could be avoided is just not right. 
You are clearly very, very bright Mr. Danly and you understand 
this position very well and I have no doubt that you will be 
confirmed, but I think that we would be making a serious 
mistake by not considering this in parity. I am still very 
hopeful.
    I have been talking to the White House. We have a person 
who is very competent, very qualified. She has been vilified to 
a certain extent, thinking she is too far to the left. I have 
checked her background, I have made phone calls, checked with 
utilities that she has worked with in her legal capacity. She 
is deemed to be extremely bright, extremely articulate, and can 
bring a lot to the table. And the Republicans have a 3-2 margin 
even with the 5. And if it was the other way, when there are 3-
2 Democrats, that is the way it is supposed to work. We do not 
eliminate somebody for the sake of politics. You know, in the 
policies, we might differ, but if they can bring quality 
information in a dialogue, I think it helps you and the other 
four members.
    So this is what we have been hoping for. This is what we 
will fight for. We think it is the right thing to do. We 
understand the background but this is the opening right now we 
have to--she has been vetted, she is going through everything. 
The FBI reports, everything, is back, ready to go, and we are 
hoping that the President in his wisdom in this next week will 
bring her forward and hopefully next week we can get her 
nomination and have a full working five members. It is what we 
are hoping for.
    We think it is good for the United States of America, good 
for all the people, good for Democrats and Republicans to have 
a five-member working Commission. So again, I want to thank 
both the nominees for their willingness to serve and being with 
us this morning. I look forward to hearing from both of you 
all, and I want to thank Chairman Murkowski for holding this 
hearing today. Thank you.
    The Chairman. Thank you, Senator Manchin, and I appreciate 
your comments. Know that I too have always believed that when 
you have a five-member Commission, it is best to have five 
members on the Commission. And the way it is structured with 
the Majority leader and the Minority leader being able to 
appoint or to nominate and then have those considered by the 
White House is a process that--sometimes it can be a little bit 
interesting navigating, but we want this Commission, we expect 
this independent agency to be able to function. We send a lot 
of work your way and we need to have smart, committed men and 
women to handle that work so know that it is my intention to 
keep working with you on this.
    Senator Manchin. Let me just say this about Senator 
Murkowski being Chairman and myself being Ranking Member, we 
have been working together and our staffs are working together. 
We are able to discuss any issue, every issue, and look at it 
from all of our colleagues on my side of the caucus and her 
side and try to work the differences out so we do not have the 
conflicts that we have in other committees. We do not let 
politics get in the way of good policy for our country.
    The lady I am speaking about has been on the desk of the 
President and the White House staff since January. If there was 
a concern, if there was a reason to disqualify her, they should 
have let me know. We could have worked on this. There is none 
so it leads me to believe that I have got to fight back as hard 
as possible not to let politics in a committee that has worked 
very, very well and very close in a bipartisan way. And that is 
what we are fighting for. This has nothing to do with Mr. 
Danly. I think you are a great nominee, and I think you will do 
a great job. I just wish you had a partner going in there with 
you to have a little bit of input from both sides of the aisle. 
That is all. Thank you, Madam Chairman.
    The Chairman. Thank you. I will just add that we are the 
Committee that has the jurisdiction over the FERC, but there 
are other committees that certainly rely on the FERC for 
processing of their good work as well. So it is significant 
this morning. I appreciate members' attention to this. We will 
proceed with swearing in both of the nominees.
    Before we do that, I had mentioned that Senator Cramer had 
hoped to be here to introduce Ms. MacGregor. His statement of 
introduction will be incorporated as part of the record.
    [The statement of Senator Cramer follows:]
    
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    The Chairman. Senator Graham had also hoped to be here to 
introduce Mr. Danly, and his statement of support will be 
included as part of the Committee record.
    [The statement of Senator Graham follows:]
    
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    The Chairman. At this time, I would ask both of the 
nominees to stand. The rules of the Committee which apply to 
all nominees require they be sworn in connection with their 
testimony. So I would ask you to please raise your right hand. 
Do you solemnly swear that the testimony you are about to give 
to the Senate Committee on Energy and Natural Resources shall 
be the truth, the whole truth, and nothing but the truth?
    Ms. MacGregor. I do.
    Mr. Danly. I do.
    The Chairman. You may both be seated. Before you begin your 
statements, I will ask you three questions addressed to each 
nominee who appears before this Committee. First, will you be 
available to appear before this Committee and other 
Congressional committees to represent Departmental and 
Commission positions and respond to issues of concern to the 
Congress?
    Ms. MacGregor. Yes.
    Mr. Danly. Yes.
    The Chairman. Are you aware of any personal holdings, 
investments, or interests that could constitute a conflict or 
create an appearance of such a conflict should you be confirmed 
and assume the office to which you have been nominated by the 
President?
    Ms. MacGregor. No.
    Mr. Danly. No.
    The Chairman. Are you involved, or do you have any assets 
held in blind trusts?
    Ms. MacGregor. No.
    Mr. Danly. No.
    The Chairman. Very good. With that, we will begin, Ms. 
MacGregor, with you. We would ask that you provide us with 
about five minutes or so of a statement, anything you wish the 
Committee to know, and then we will proceed to Mr. Danly. If 
either of you have family or those in the audience that you 
wish to introduce, you are certainly encouraged to do so 
because we welcome them as well. Ms. MacGregor, if you would 
like to begin.

   STATEMENT OF KATHARINE MACGREGOR, NOMINATED TO BE DEPUTY 
                   SECRETARY OF THE INTERIOR

    Ms. MacGregor. Chairman Murkowski, Ranking Member Manchin, 
and members of the Committee, it is with profound humility that 
I thank you for the opportunity to appear here today as 
President Trump's nominee for the position of Deputy Secretary 
of the Department of the Interior.
    This morning I am joined by one of my brothers, Robert 
MacGregor, who is one of my favorite brothers, and my aunt and 
godmother, Sheila Sanford. I am also joined by my best friend 
from college, Carla Spain, and my goddaughter, Elizabeth Spain, 
who flew out today from California. Finally I am joined by my 
parents, Jean and Peter MacGregor, who have sacrificed so much 
for us, including at least 10 straight years of weekends 
driving us to ice hockey games. As they are hockey parents, I 
feel compelled to remind them that this is not a hockey game, 
there are no refs to yell at, so kindly abide by the rules of 
the Committee.
    My personal introduction to the mission of the Department 
of the Interior began much as one might expect in a state where 
the federal footprint is just two percent with our national 
parks. Some of my earliest memories are of my parents taking me 
and my brothers to Valley Forge National Park to play and learn 
about our nation's early history. In driving up and down the 
Eastern seaboard to all of our ice hockey games, I do not think 
there is a battlefield that my dad didn't stop at. From 
Yorktown, to Gettysburg, to Lexington and Concord, we saw them 
all.
    I have to admit today that these visits drove my passion 
for American history and my understanding for the importance of 
preserving these special places for future generations. In my 
decade of federal service on Capitol Hill working on natural 
resource issues, I formed an even deeper understanding of the 
broad and diverse missions of the Interior Department. In 
addition to our parks and monuments, I learned our nation's 
history through a new lens, our controlling statutes.
    Beginning with the Homestead Act and Pacific Railroad Acts 
of 1862, our laws tell the tale of an expanding, industrialized 
nation growing Westward, and a government providing measured 
access to the land so that people could carve out an existence. 
These laws have provided the Interior Department with a wide 
and wonderful range of mission areas and a land ownership and 
management pattern that does not come without challenges.
    However, since day one at Interior, I have worked hard to 
achieve a balance in managing America's public lands, cultural 
treasures, and natural resources in order to achieve this 
Administration's priorities. I take seriously the call to 
protect our healthy natural environment and the species that 
depend upon it just as seriously as I take the call to foster 
economic growth through the multiple-use and sustained yield of 
our public lands. In both my time working on Capitol Hill and 
at Interior, I have had the privilege to visit many of your 
states, meet some of your constituents, and work on issues that 
are important to them. In the Permian Basin, we had the largest 
revenue sales in the history of the Department, $1 billion, and 
I was able to hand over half of the proceeds to the State of 
New Mexico to reinvest in schools, law enforcement, and other 
priority municipal needs.
    I have worked to enhance the reach of broadband to rural 
and tribal communities so that they may have the same 
educational and economic opportunities that we take for granted 
here in our 5-bars world. And I have worked hard with our 
Assistant Secretary for Indian Affairs, Tara Sweeney, to 
address the outrage of missing and murdered Native American 
women. In fact, one of the personal stories I heard on my 
recent trip to Bethel, Alaska, to discuss these issues will 
stay with me forever. I will never again take for granted that 
access to justice sometimes relies upon a navigable road.
    What I have learned from my time here at Interior and in 
your states is similar to what I have learned from many of you 
in our meetings last week. So many people have a profound 
connection to the lands and waters that we manage, just as 
Valley Forge National Park serves as one waypoint in my 
personal history that reminds me of the love, joy, and strength 
of my family. So many people care deeply about the decisions we 
make and many feel that Washington has forgotten about them, 
their families, and their way of life.
    From landing a bowhead whale up in Wainwright, Alaska, to 
cutting and milling timber in the O&C counties, moving cattle 
around an arid landscape, or moving kids around our national 
parks in an RV, all of these uses are valid and important, 
often directed and preserved in our statutes. All of these uses 
can and should continue to meet the needs of current and future 
generations. If confirmed, I will do my best to ensure that we 
strike the right balance in a way that will provide 
conservation stewardship, enhance the safety of our 
communities, increase energy security, and allow rural 
communities to thrive and prosper.
    Again, thank you for this opportunity and I look forward to 
your questions.
    [The prepared statement of Ms. MacGregor follows:]
    
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    The Chairman. Thank you very much, Ms. MacGregor. We 
appreciate that. Mr. Danly, welcome.

 STATEMENT OF JAMES P. DANLY, NOMINATED TO BE A MEMBER OF THE 
              FEDERAL ENERGY REGULATORY COMMISSION

    Mr. Danly. Good morning Chairman Murkowski, Ranking Member 
Manchin, members of the Committee. It is an honor to sit before 
you today as a nominee to the Federal Energy Regulatory 
Commission. I would like to start by thanking the President for 
nominating me and by thanking the members of the Committee who 
have been so gracious with their time in meeting with me. It 
was a pleasure to speak with you and learn about your interests 
in all of the issues touching FERC's jurisdiction that matter 
so much to you and to your states.
    I would also like to thank Chairman Chatterjee for all the 
support he has shown me and the faith he has placed in me as 
his General Counsel. And I would be remiss if I did not say 
thank you to former Chairman Kevin McIntyre. Everyone who 
worked with Kevin knew him to be wise, very humane, and I am 
grateful for the opportunity to have worked for him.
    And lastly, I would like to thank my wife, Frankie, who is 
with me today. We met more than 20 years ago as undergraduates. 
Frankie has been with me through thick and thin, and she has my 
sincere gratitude for all the selfless support she has shown me 
over the years. As a military wife, when I was deployed to Iraq 
as an Army officer, when I was clerking on the Sixth Circuit 
through grueling hours at my former law firm, and more recently 
as I have been absorbed with my duties at the Commission. Our 
son, James, is an energetic four-year-old who, for good reason, 
is not here today, but I speak for him too when I say thank 
you, Frankie.
    Since 2017, I have had the privilege of serving as FERC's 
General Counsel. In that capacity, I have directed the 200 
lawyers in the Office of the General Counsel, overseen the 
Commission's appellate litigation, and provided legal counsel 
to two different Chairmen and four other Commissioners. I have 
seen firsthand what can be accomplished when talented, 
dedicated Commissioners take on the challenges presented by the 
nation's ever-changing energy landscape. As every member of 
this Committee knows, FERC's role as a regulator, though 
narrow, is profound. The importance of the work the Commission 
does in regulating electric and gas rates, permitting 
infrastructure, protecting the reliability of the bulk electric 
system, and overseeing our electric markets cannot be 
overstated.
    Every aspect of American life is touched by the work done 
at the Commission. Although FERC's organic statutes were passed 
some 80 years ago, those laws are as relevant today as ever. In 
an era in which the very structure of our electric system 
changes at an ever-increasing rate, FERC has worked diligently 
to ensure open access, to guarantee fair, competitive markets, 
and to remove barriers to entry that could stifle progress as 
new technologies are developed to enhance the efficiency and 
reliability of our electric system.
    The fact that the Commission, operating under authorities 
nearly a century old, the fact that it has overseen such 
transformative change to the American utility sector is a 
testament not only to the dedication and ingenuity of the 
Commission and its staff----
    [Public Outburst.]
    The Chairman. Go ahead.
    Senator Manchin. Welcome to the U.S. Senate.
    Mr. Danly. Thank you. The fact that the Commission, 
operating under authorities nearly a century old, is overseeing 
such a dramatic change in the American utility sector is a 
testament not only to the ingenuity and dedication of the 
Commission and its staff but also to the robustness and 
flexibility of the institution that was created by Congress and 
by Commissioners past and present. One of FERC's greatest 
attributes is that it is a collegial body.
    And I am speaking not just to the fact that the 
Commissioners work collaboratively, though FERC quite rightly 
enjoys a reputation for that kind of collegiality. I am also 
speaking of the fact that as a multi-member body each 
Commissioner brings their own experience and point of view when 
deciding the questions presented to the Commission. As a lawyer 
I take my role and obligations seriously, and I care deeply 
about the rule of law. I believe it is incumbent on every 
Commissioner to act within the authorities granted by Congress 
when discharging the Commission's duties.
    I also believe that every Commissioner is obligated to 
decide each case presented on the law and the record before 
them. Should I be so fortunate as to be confirmed, I pledge to 
this Committee that I will strive to continue all of the 
critical work the Commission has done to ensure just and 
reasonable rates, to strengthen our electric system's 
reliability, and ensure the timely review of infrastructure.
    I truly appreciate the honor that has been bestowed upon 
me, and should I be confirmed, I will endeavor to live up to 
FERC's great tradition of flexibility, independence, and 
collegiality. Thank you for the opportunity to appear before 
you and I look forward to your questions.
    [The prepared statement of Mr. Danly follows:]
    
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    The Chairman. Thank you, Mr. Danly. I apologize for a 
little bit of an interruption there.
    Let me start with you, Ms. MacGregor, and this relates to 
what we have all been watching these past couple weeks in 
California with the intensity of the fires in that region. In 
the 2018 Appropriations Act, we in Congress included a 
provision that expedites removal of vegetation and hazardous 
trees inside power line rights-of-way corridors on federal 
lands. Last month, the Forest Service issued some proposed regs 
to implement the law. It is my understanding that Interior is 
working on guidance. We have not seen anything to date.
    So I would ask you not only what is the status of that 
guidance, but can you speak to actions that the Department has 
taken since Secretary Zinke's Executive Order 3372 which 
focused on reducing wildfire risk? This is something that is on 
everyone's mind, so there is interest in knowing what has been 
done and what more needs to be done, and then the guidance on 
the vegetation management.
    Ms. MacGregor. Thank you for the question, Senator. This is 
of vital importance to the Department and something that I care 
about personally. Since the passage of Section 512 we have 
implemented it in certain states. I believe the State of 
California has an instruction memorandum with the Bureau of 
Land Management (BLM) to abide by the provisions that you 
provided in that law. I would state that the Bureau of Land 
Management has doubled their fuels treatment since 2015 and I 
believe we are doing everything we can, in accordance with NEPA 
(National Environmental Policy Act), to conduct mechanical 
thinning, clearing, targeted grazing, salvage sales where 
applicable, and prescribed burns.
    And we are trying to make sure we are laser focused on 
doing this in the wildland-urban interface to protect 
communities. There are other tools that we may use in the form 
of categorical exclusions. I believe the Department, and the 
BLM in particular, only has access I think to 300 acres for 
salvage sales right now, which is quite different from the 
Forest Service, but we are doing everything in our power to get 
out there and make sure we are making use of those provisions 
and evaluating whether or not a rulemaking would be necessary 
as well.
    The Chairman. And the timing on the guidance?
    Ms. MacGregor. So the BLM California guidance is out now, 
and I anticipate similar guidances are going out in the form of 
instruction memoranda.
    The Chairman. Right. Thank you.
    Mr. Danly, I want to ask about a letter that Senator 
Schumer sent yesterday calling on DOE's Inspector General to 
investigate what he calls the ``provision of inconsistent and 
inaccurate ethics advice by FERC's Office of General Counsel 
and the enforcement of the ethics pledge.''
    [The letter referred to follows:]
    
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    The Chairman. Now despite the claims in this letter, it is 
my understanding that the ethics advice at FERC is provided by 
FERC's designated agency ethics official. This is a position 
that is not overseen or managed by the Office of General 
Counsel. So I would ask you to respond to the claims made in 
Senator Schumer's letter and explain your role, if any, in 
ethics advice that has been provided by FERC's designated 
agency ethics official or in the White House issuance of 
waivers.
    Mr. Danly. Yes. Thank you, Senator. I appreciate the 
question. I saw that letter too in the press reports that 
mention it that were out yesterday. I have, as General Counsel, 
no role whatever in the provision of ethics advice. The entire 
Federal Government, every agency in the Federal Government, by 
regulation in 5 CFR Part 2638.104 specifies that every agency 
has a designated agency ethics officer and we call them DEO. 
And the DEO reports to only one person and that is the head of 
the agency.
    In our case, that would be the Chairman. The Office of 
General Counsel does not oversee any of the activities of the 
DEO. Nobody in my office, including myself, reviews his 
decisions and we aren't part of the discussions that happen 
between the DEO and the person in the agency that is receiving 
his ethics advice. So there is no role whatever for the Office 
of General Counsel in that process or in that program.
    The Chairman. No role and you have not been involved in any 
way then?
    Mr. Danly. I am not involved in any of the advice that is 
given by the DEO to any of the people in our Agency.
    The Chairman. Thank you. Let me turn to Senator Manchin.
    Senator Manchin. Thank you, Madam Chairman.
    I will start with my first question to Ms. MacGregor. On 
the public lands, the ownership of public lands, well it 
belongs to all of us. I have not had that much experience with 
BLM. I am trying to get up to speed as fast as I can, but I 
haven't spent enough time in the West as I should, and I would 
love to. But I am making it there. The thing I want to make 
sure I understand is getting a fair return for the taxpayers. 
And I guess a way you can see if it is a fair return is if it 
is market-driven, not politically-driven or policy-driven, but 
market-driven. What is your approach to that as far as 
royalties the taxpayers receive back? I will go right into the 
1872 mining law, which has not been adjusted whatsoever for 
close to 150 years? Do you think that it is time that we should 
be moving in a direction to try to bring those royalties up to 
21st century regulations?
    Ms. MacGregor. Sir, first, let me invite you to any trip 
you would like to take viewing lands, especially to see mining 
in action. There is a lot of mining in the State of Nevada. As 
you know, we consider mining important at the Department of the 
Interior. It is estimated that it provides $3 trillion in value 
add to the United States GDP and is an important source of jobs 
to many states. As for the Mining Law of 1872 and fair market 
value through our statutes, we look to our statutes for our 
guidance in ensuring fair market value is achieved.
    Senator Manchin. Not on 1872's regulations, basically how 
they treat the land when they leave. There are no laws that 
prohibit them from basically leaving open pits and drainages 
and everything else, and you cannot do that in coal mining.
    Ms. MacGregor. Right. The Mining Law of 1872 set specific 
per acre fees. And on top of that there is an aspect of clean 
maintenance fees that we do collect from mining.
    Senator Manchin. Would you not think that after 150 years 
we should reevaluate that?
    Ms. MacGregor. Should the Congress choose to amend the 
Mining Law of 1872, we will certainly work with you.
    Senator Manchin. Mr. Danly, can you just explain what you 
meant by the humble regulator approach?
    Mr. Danly. Sure. Thank you for the question Senator. Yes, 
that was a phrase that I used in a speech at one point and it 
boils down to the concept that officials and agencies should do 
honor to the statute that they are charged with administrating. 
And that is basically the sum of it.
    Senator Manchin. States--if you want to explain a little 
bit more about the reasonable wholesale markets?
    Mr. Danly. I am sorry?
    Senator Manchin. Wholesale markets? FERC being involved in 
wholesale markets, if you can. PGM and oversight there, if you 
want to talk about that.
    Mr. Danly. Sure. So the wholesale markets are these 
regional markets that FERC has created and allowed to be 
created over the last few couple decades have seen a drastic 
change in the way that electricity services are provided to 
utilities in very large swaths of America. This has been an 
attempt to harness market forces in order to drive down prices 
and assure the most efficient possible dispatch of utilities. 
This is a system that ensures resource adequacy and the lowest 
possible cost, and it is contrasted to the old style of utility 
regulation in which the previous years' vertically integrated 
utilities acted on their own to simply plan and then have their 
returns based in the old days on cost of service rate making.
    Senator Manchin. My main concern is basically reliability 
versus just the cheapest form of filling the grid system and 
how reliable it is. Baseload, things of that sort, you consider 
when you are making a determination of what comes on it.
    Mr. Danly. So, thank you. One of the basic requirements, or 
one of the basic objectives, that our capacity markets are 
designed for in the case of PGM is resource adequacy. We are 
using--across America the different RTOs are trying to employ 
market signals to incent the proper new entry to ensure that 
there is sufficient capacity to meet not just the predicted 
peak load days, but then a certain reserve margin beyond that. 
Those are successful programs so far, and the markets are 
always being refined both by the tariff owners and by FERC to 
ensure that those objectives of the capacity markets are met.
    Senator Manchin. If I can ask one final question. Ms. 
MacGregor, what is the greatest threat you think that we face 
as citizens of this country protecting the public lands that we 
have?
    Ms. MacGregor. Right now, sir, to be frank, wildfire and 
the risk to human life is on my mind.
    Senator Manchin. From the private sector being involved, 
participating in economic resources, is that cause for any 
concern whatsoever or do you think we are being good stewards 
there? Are we doing a good job of overseeing that?
    Ms. MacGregor. I think we do quite well in the United 
States, and economic prosperity is really important to many of 
the rural communities we work with and our statutes direct us 
to utilize those resources but do so in a measured manner.
    Senator Manchin. How about recreation?
    Ms. MacGregor. Recreation is vital to many economies.
    Senator Manchin. I know you and I had a passionate 
conversation on this, but we all believe very strongly, I think 
on both sides of the aisle, that is a game changer economically 
in all of our states and you support that wholeheartedly?
    Ms. MacGregor. Absolutely. I wholeheartedly----
    Senator Manchin. Recreation and development?
    Ms. MacGregor. ----enjoy recreation and have in your state.
    Senator Manchin. Okay. Thank you.
    The Chairman. Thank you, Senator.
    Senator Alexander.
    Senator Alexander. Thank you, Madam Chairman. Welcome, Ms. 
MacGregor, Mr. Danly.
    Ms. MacGregor, I want to talk about the nearly $12 billion 
in long-delayed maintenance projects at our 419 national parks, 
and about a remarkable piece of legislation that has attracted 
an unusual amount of bipartisan support, and that is the 
Restore Our Parks Act which was introduced by Senator King and 
me and Senator Warner and Senator Portman earlier this year.
    That bill has 43 co-sponsors--13 Republicans and 30 
Democrats. It is in this Committee. It has had the strong 
support of the Administration, of the President. So my question 
to you is does the Administration still support the Restore Our 
Parks Act?
    Ms. MacGregor. Senator, we absolutely support addressing 
our nation's backlog on national parks.
    Senator Alexander. And if I am not mistaken, I believe this 
is the first Administration that has allowed its Office of 
Management and Budget to support a method of funding of this 
deferred maintenance in the way that this legislation does, and 
you reflect that in the budget that the President submitted to 
Congress this year. Is that correct?
    Ms. MacGregor. That is 100 percent accurate, and I would 
point out, as Senator Manchin said in his introductory remarks, 
finding consensus can be a struggle sometimes and this is one 
area where many brilliantly have found consensus.
    Senator Alexander. Well, it can especially be a difficult 
area and in the area of environmental matters, but here we have 
President Trump, virtually every environmental group, 
conservation group that I am aware of, and Republican and 
Democratic Senators in support of it. Now in the House of 
Representatives, there is also strong support, 330 co-
sponsors--128 Republicans and 202 Democrats--and that moved out 
of the House Natural Resources Committee in June by a vote of 
36 to 2. My hope, Madam Chairman and Senator Manchin, would be 
that we could do this year the same thing we did last year.
    There is another bill that I support which Senator Manchin 
and Senator Gardner support which has to do with mandatory 
funding for the Land and Water Conservation Fund. Ms. 
MacGregor, is that a part of the President's budget?
    Ms. MacGregor. Sir, the Land and Water Conservation Fund is 
of great importance to many counties, and we work very closely 
with the Congress in implementing what funds we receive.
    Senator Alexander. Right. But at this point it would be 
accurate to say that funding for the Restore Our Parks Act is 
in the President's budget and mandatory funding for the Land 
and Water Conservation Fund is not in the President's budget?
    Ms. MacGregor. That would be accurate.
    Senator Alexander. Okay. Well my hope, Madam Chairman and 
Senator Manchin, would be that this Committee could do this 
year what it did in the last Congress. I am a co-sponsor of 
Senator Manchin's bill on the Land and Water Conservation Fund. 
I have been strongly for it for a long time going back to the 
time of the President's Commission on Americans Outdoors in 
1985 and '86. But I think the better way to have success with 
those bills is to do again what we did before and what the 
House did, which is moved them together but separately. The 
Restore Our Parks Act is in the President's budget.
    We could move the Land and Water Conservation Fund bill out 
of this Committee I believe. I would certainly vote for it. I 
think there are enough votes to do that and do it first to make 
sure it comes out of Committee, then we could move the Restore 
Our Parks Act out of Committee. Then the Senate could consider 
both of them. The House has done the same and then we can go to 
work to see how much we can get done on the Floor of the 
Senate. So I do not want us to miss this opportunity.
    Ms. MacGregor, can you think of another way, other than the 
Restore Our Parks Act, that Congress might be able to provide 
funds to reduce, cut in half the $12 billion deferred 
maintenance backlog of the National Park System that exists 
today other than the Restore Our Parks Act?
    Ms. MacGregor. Sir, I do not believe in 20 seconds I could 
contemplate new ideas on that front for $12 billion.
    Senator Alexander. Well, I cannot think of any. I know for 
me to give you an example, the maintenance backlog in the Great 
Smokies is $235 million. The annual appropriation for the 
Smokies is $20 million. The Smokies has no entrance fee because 
of an agreement made at the time the park was created. So there 
is no possible way that the backlog in the Smokies could ever 
be addressed without something like the Restore Our Parks Act. 
And Madam Chairman and Senator Manchin, I hope that the 
Committee will do again this Congress what we did last Congress 
and move both bills separately, together out of Committee and 
let the full Senate consider them. Thank you very much.
    The Chairman. Thank you, Senator Alexander, and I 
appreciate your continued focus on what we are going to do with 
our park maintenance backlog.
    Senator Heinrich.
    Senator Heinrich. Thank you, Madam Chair, and I want to say 
despite the fact that the Ranking Member is not here to hear it 
right now, I look forward to working with him to reform the 
1872 Mining Act.
    We have had our share of threats to water security in our 
state as a result of that antiquated legislation, and there is 
nothing more important to economic development in a Western 
area state than water. I am going to confine most of my 
comments to the first nomination today, and Madam Chair, I just 
want to say how deeply worried I am that we are on the 
precipice of the FERC becoming another political entity, 
another extension of the White House or DOE.
    There is a lot of risk associated with that in the short-
term that may work well for one side and their view, but it 
risks creating a back-and-forth that I think would be truly 
untenable for our energy grid overall. You could see a scenario 
playing out where in the short-term certain sources of energy 
are subsidized to the point of driving energy costs 
substantially. That might be good for some people regionally.
    In a year, maybe the gentlewoman who is escorted out gets 
nominated and appointed to the FERC and we can no longer permit 
natural gas lines at all in this country. The FERC has worked 
much like this Committee, very effectively in a very bipartisan 
manner, and it pains me to say that I am frankly disappointed 
in the current Chairman. I am mostly disappointed not in his 
decisions but in how he has conducted himself. He has engaged 
in a war with the media. He has posted things like ``come at me 
bro'' online to his critics. When we do this and when we fail 
to pair nominees, we really risk tearing down the norms that 
have made this body so effective and so apolitical for so long.
    I do not think that is the responsibility of Mr. Danly to 
speak to. I certainly would not ask him to criticize or comment 
on his potential colleagues should he be confirmed, but I do 
want to ask you--Mr. Danly, if confirmed, you are going to help 
determine whether FERC continues to be viewed as independent, 
as apolitical, and whether or not it will behave as a 
regulatory body as opposed to a political body. I think you 
have an awful lot of experience that says you understand the 
distinction between those two approaches. I want to ask you how 
you intend to meet that responsibility and, frankly, how should 
a FERC Commissioner conduct themselves in the public sphere?
    Mr. Danly. Thank you for the question Senator. As to the 
first point, I view the role of the FERC Commissioner as being 
primarily that of an adjudicator. And that, should I be 
fortunate enough to be confirmed, is exactly how I would 
comport myself. This is the role of a judge more than it is the 
role of a policy setter. Now I know under the Administrative 
Procedures Act we have the option of doing both adjudications 
and rulemakings, of course. That is part of what FERC does. But 
in the 1,200 or so orders per year that are issued, substantive 
orders, there are 5,000 or so of the kind of housekeeping ones. 
The vast majority of those are adjudicatory. I would conduct 
myself as an adjudicator and confine my decisions to the law on 
the record as it's developed. And, yes, that is my philosophy 
on what the proper role of a Commissioner is.
    Senator Heinrich. Last year, the Commissioners voted 5-0 to 
terminate Secretary Perry's proposed rulemaking that would have 
required ratepayers to subsidize what are currently uneconomic 
generation sources. Did you agree with FERC's unanimous 
decision to reject those subsidies?
    Mr. Danly. Yes. I agreed with the decision on the 403.
    Senator Heinrich. Do you think that there is currently an 
urgent threat to the resilience and the reliability of the 
power grid that would justify an intervention in wholesale 
power markets?
    Mr. Danly. I am sorry, sir. You said a wholesale power 
markets what?
    Senator Heinrich. Do you believe that currently there is 
enough of an urgent threat to the resilience and the 
reliability of the grid for FERC to intervene in those 
wholesale markets and subsidize one source of generation over 
another?
    Mr. Danly. Thank you. So the purpose of these wholesale 
markets is to ensure just and reasonable rates, and I think 
that like any complicated and integrated wide-ranging 
regulatory regime, it is an iterative process of continuous 
refinement of how these markets function. I do not see a need 
for there to be a wholesale revision of the wholesale market, 
is how I think you put it, but there certainly is work 
continuously that has to be done by the Commission and by the 
utilities that file their terms with us, to try to get the most 
accurate pricing possible. And that is something that is a 
goal, that though elusive, is always something the Commission 
needs to strive for.
    Senator Heinrich. Thank you, Mr. Danly.
    The Chairman. Senator Cassidy.
    Senator Cassidy. I just saw the letter that Senator Schumer 
sent, but just repute once more for the record you had nothing 
to do with the ethics, with the DEO.
    Mr. Danly. So, thank you, Senator. That is correct. The 
designated agency ethics officer, not just in FERC, understand, 
but in every agency across government according to the Code of 
Federal Regulations, is the legal obligation that the agencies 
have, is appointed by and reports to the agency head and the 
agency head alone. Now, of course, he has interactions with the 
Office of Government Ethics and so forth. But that is the chain 
of command for the purposes of the agencies.
    Senator Cassidy. I think also for the record I can point 
out from something I got from you, Madam Chair, is that 35 
percent of the time people come before this Committee and they 
are not paired with someone from the other party. But in this 
case, actually I am told you mentioned that in your opening 
statement, but indeed the position that you are filling 
originally was paired with Mr. Glick. And so anyway just to say 
there has been a lot of objections to this, but I gather only 
27 percent of the time were people formerly paired. So more 
often than not they are not. So there seems to be a little bit 
of, oh, I don't know, ``bree'' around this, but just to make 
that straight for the record.
    Ms. MacGregor, great to see you. Congratulations to you 
both, but also I enjoyed working with you when I was with Doc 
Hastings way back when and thank you for your trips to 
Louisiana.
    Of course, as you know, I am concerned about the eroding 
coast in Louisiana, and there is this kind of a relationship 
between offshore oil production and the revenue that we use to 
rebuild our coastline. Interior has a role in that. Would you 
comment on that role and what you see could be done 
constructively to help Louisiana's resiliency?
    Ms. MacGregor. Yes, sir. Oil and gas production off our 
coasts predominantly in the Central and Western Gulf of Mexico 
account for 16 percent of our nation's crude and roughly 3 
percent of our natural gas. Under the Gulf of Mexico Energy 
Security Act, which is law, we adhere to the revenue-sharing 
provisions that are guaranteed by that law which include 37.5 
percent of the revenues being shared with the four Gulf states 
at a cap of $500 million on an annual basis. That law also 
includes a 12.5 percent set aside for mandatory Land and Water 
Conservation Fund funding, and I know that the State of 
Louisiana subsequent laws that utilize the revenue-sharing 
funds for coastal restoration.
    Senator Cassidy. Yes, so we do. Let me also point out that 
although Senator Alexander is all about using more Gulf of 
Mexico revenue for mandatory spending on Land and Water 
Conservation Fund, I would love it if everybody who believes in 
it would allow the onshore federal lands to contribute to that 
as well because right now about 80 percent of it comes from the 
Gulf of Mexico. At some point you begin to cannibalize dollars 
that could come to Louisiana and other Gulf Coast states for 
coastal restoration.
    I also point out that there is a cap on that which is 
shared with the Gulf Coast states. I think it is 35 percent, a 
$500 million overall cap, whereas there is no cap on the 
onshore and they are at 51 percent of the revenue share and we 
are 35 percent up to a $500 million cap. I am confirming that. 
But just to say that the lack of equity is just kind of 
galling, particularly when we are using money for coastal 
restoration and theirs goes to kind of the general fund. So 
anyway, I hope my fellow Senators will ponder that as they 
enthusiastically support this bipartisan legislation as Senator 
Alexander refers to it. With that, I yield back. Thank you.
    The Chairman. Thank you, Senator.
    Senator Hirono.
    Senator Hirono. Thank you, Madam Chair. I ask the following 
two questions of every nominee who comes before any of the 
committees on which I sit. First question, since you became a 
legal adult have you ever made unwanted requests for sexual 
favors or committed any verbal or physical harassment or 
assault of a sexual nature, Ms. MacGregor?
    Ms. MacGregor. No.
    Senator Hirono. Mr. Danly?
    Mr. Danly. No.
    Senator Hirono. Second question, have you ever faced 
discipline or entered into a settlement related to this kind of 
conduct?
    Ms. MacGregor. I have not.
    Mr. Danly. No.
    Senator Hirono. Ms. MacGregor, just yesterday Reveal 
published an article that detailed your close relationship with 
the oil and gas industry. You are outspoken about your belief 
that environmental regulations are burdensome, and you strongly 
support expanding oil and gas development on public lands. The 
article noted that if issues arise for the fossil fuel 
industry, their response is, I quote the article, ``We'll call 
Kate.'' You are close to the fossil industry. I am not 
surprised that Donald Trump nominated you to serve as a second-
in-command at the Department.
    DOI is full of political appointees that, like you, are 
close to the fossil fuel industry starting at the top with 
Secretary Bernhardt who shares your perspective that 
environmental regulations are burdensome. We know that the 
fossil fuel industry opposes actions to address climate change. 
However, in a report submitted by the DOI IG last November that 
summarized the major management and performance challenges 
facing the Department for Fiscal Year 2018, it noted that many 
DOI coastal assets are threatened by climate effects. Does 
climate change pose a significant risk to DOI assets?
    Ms. MacGregor. Thank you, Senator. I recognize that the 
climate is changing. Man does have an impact. That is what the 
science tells us. And the science indicates that there is great 
uncertainty in projections related to those impacts.
    Senator Hirono. So is your answer yes?
    Ms. MacGregor. Yes.
    Senator Hirono. Sounds like yes. Okay. During your time at 
DOI have you been personally involved in or witnessed two 
instances of political interference with scientific research or 
communication?
    Ms. MacGregor. I have not. In fact in my time at Interior, 
the Secretary has appointed a counselor, a senior advisor, a 
senior science advisor in the Secretary's hallway and we have 
noticed that scientific integrity complaints have gone down 
under our Administration.
    Senator Hirono. That is good to hear, although I am not so 
sure that this Administration is committed to science over 
political considerations.
    Again for you Ms. MacGregor, several outside groups have 
conducted a number of DOI employee surveys over the past few 
years and in response to one recent survey, a DOI Senior 
Executive Service employee said, ``the biggest problem or 
challenge now facing DOI is inexperience, lack of competence, 
and extreme political influence by the current group of 
appointees whether confirmed or acting.'' Another survey found 
that more than 39 percent of respondents from the National Park 
Service and U.S. Fish and Wildlife Service reported poor 
leadership. If confirmed, what will you do to improve staff 
morale?
    Ms. MacGregor. Thank you for that question, Senator, and I 
think it is very important. And one of the--we have many 
surveys. One of our recent surveys, which was originally 
conducted in 2017 also found that there are increased instances 
of potential harassing behavior, which I think is important to 
you. And we have found in our most recent survey that harassing 
behavior has gone down. I think we need to work very closely 
with our professional career employees. I have had great 
experience in working with them, and we believe having a strong 
ethical culture is important at the Department.
    Senator Hirono. And in fact, there is another GAO report, 
September 2019, that said that there have been threats, 
including threats to kill people, to Federal Land Management 
employees and so there are these safety risks. Are you 
committed to making sure that you address the safety risks of 
your employees?
    Ms. MacGregor. Absolutely.
    Senator Hirono. Mr. Danly, in May 2018 FERC issued a policy 
as part of its consideration of Dominion Energy Transmissions 
Newmarket Gas Pipeline Project that attempted to eliminate 
consideration of most upstream and downstream greenhouse gas 
emissions as part of FERC's review of interstate gas pipelines. 
You defended that policy in court as General Counsel arguing 
that it would be ``an exercise in futility'' to ask project 
developers for more information about the origin or destination 
of the gas. Then in June 2019 the D.C. Circuit of Appeals 
affirmed FERC's obligation to consider these kinds of 
foreseeable gas emissions under NEPA.
    If the Senate confirms you, what is your plan for how FERC 
will identify the information on the greenhouse gas emissions 
from gas pipelines necessary to fulfill its statutory 
responsibilities, having argued that it is ``an exercise in 
futility'' to get such information?
    Mr. Danly. Thank you for the question, Senator. In the 
colloquy with, I believe it was Judge Garland, I was having a 
discussion about the jurisdictional power of the Commission to 
compel information from end-use customers. As to the answer to 
your question on how to deal with the greenhouse gas emissions, 
the black letter law of CQs implementing regulations for the 
National Environmental Policy Act require that all direct and 
indirect effects and cumulative impacts of every major federal 
action be reviewed and considered when making a decision. And I 
have every intention of following that unequivocal black letter 
law should I be lucky enough to be confirmed.
    Senator Hirono. Even if you say it is an exercise in 
futility? Well, I hope you do your best. Thank you.
    The Chairman. Senator Barrasso.
    Senator Barrasso. Thank you, Madam Chairman. Madam 
Chairman, both of these positions are very important to the 
State of Wyoming. These are very important positions, and I 
appreciate this Administration's recommendations and 
nominations and I am delighted to have both of you here today. 
I would also say that I heard from a previous Senator that one 
of the nominees has been outspoken about the belief that oil 
and gas regulations are burdensome. Well let me tell you they 
are also expensive and they are also time-consuming. All of 
those things apply to some of these regulations. I have seen it 
every day in Wyoming.
    Wyoming has been directly impacted by a series of 
unfavorable court decisions, including the WildEarth Guardians 
case, a case in which the court prohibited oil and gas activity 
permitting on over 300,000 acres of federal land in my state. 
The Bureau of Land Management acted quickly to address the 
court's concerns.
    Ms. MacGregor, you know, these decisions cause considerable 
uncertainty for all the stakeholders. So there is an expense, 
there is a burden, there is uncertainty. Will you commit to 
communicate clearly with states and stakeholders about the next 
steps to reduce as much as possible the uncertainty that comes 
with such decisions?
    Ms. MacGregor. Yes, sir.
    Senator Barrasso. The Department of the Interior announced 
last month that revenues generated from energy development on 
federal lands increased by almost $500 million and $750 million 
over the Fiscal Year 2018, totaling $11.6 billion. In addition, 
the Office of Natural Resources Revenue distributed more than 
$2.4 billion of the Fiscal Year 2019 energy revenues to 35 
states. My home State of Wyoming got $641 million in revenue.
    And several of the Democratic Presidential candidates have 
stated that they are going to ban--we see this in the debates, 
see it on television, they are not hiding this--banning 
hydraulic fracking on the federal lands if elected. Some have 
gone further to say they will end all federal oil and gas 
leasing. So what impact would such a policy have on the Federal 
Treasury and the states that receive such significant funding 
from federal leasing and production?
    Ms. MacGregor. Thank you for the question, Senator. 
Hydraulic fracking when paired with directional drilling and 
other innovations that have been created in this country since 
2006 have led to our decreased dependence on foreign oil and 
have played a role in, I believe, energy prices for this 
nation. A complete ban would significantly impact energy 
production.
    Senator Barrasso. So it would increase prices for users and 
it would decrease revenues to the states that have been 
benefiting by this?
    Ms. MacGregor. That is likely, I believe, yes.
    Senator Barrasso. So last month the Bureau of Land 
Management issued a proposed rule to streamline the process for 
reducing the royalty rate on trona, known as soda ash. Wyoming 
soda ash producers are up against severe international 
competition. In the global marketplace, countries like China 
flood the markets with synthetic low-quality soda ash. Former 
Secretary Zinke made a commitment to me and several others 
including the House Republican Leader, Kevin McCarthy, to take 
steps to lower the royalty rate on soda ash. Secretary 
Bernhardt understands the importance of this rulemaking. Will 
you support the Secretary lowering the royalty rate on soda ash 
from 6 percent to 2 percent?
    Ms. MacGregor. Sir, the law provides the Secretary with 
that authority to lower royalty rates based upon a variety of 
issues. And yes, we will work with you on that through the 
rulemaking process.
    Senator Barrasso. Across the country invasive species 
damage ecosystems, cause billions of dollars in economic damage 
each year. There was a story today in the New York Times about 
invasive species and wildfires in California.
    So in 1999, the National Invasive Species Council was 
created to bring together resources and improve coordination 
among the secretaries and a number of different secretaries. A 
committee was created to advise the Council in best practices 
and emerging threats. Earlier this year the committee was 
placed on an inactive administrative status.
    So given the threat of a variety of invasive species that 
they pose to our communities and to natural resources and 
economies, what steps do you think we should take to ensure the 
coordination among the various secretaries continues even in 
the absence of the advisory committee?
    Ms. MacGregor. Sir, we do quite a bit of analysis and 
studies on the impacts of invasive species on a variety of the 
different needs in different states. I believe we need to work 
with states and find the most effective ways to address these 
invasive species and reduce their impacts significantly.
    Senator Barrasso. Thank you. Madam Chairman, I am out of 
time so I am going to submit in writing a question to Mr. Danly 
related to the legislation that I have introduced updating 
purchase obligations to deploy affordable resources to energy 
markets. It is called Update PURPA, and I am working along with 
Senators Risch, Cramer, and Daines. So thank you, Madam 
Chairman.
    The Chairman. Very good. Thank you, Senator Barrasso.
    Senator Cortez Masto.
    Senator Cortez Masto. Thank you, Madam Chair. Welcome to 
both of you. Congratulations on your nominations. It is okay to 
smile at this point. You are almost done. Welcome to your 
families. It is great to see everybody here. Let me ask a 
couple questions.
    Ms. MacGregor, you highlighted--I am from Nevada. Over 80 
percent of the lands are owned by the Federal Government, the 
majority of that is the BLM. So first of all, have you been to 
Nevada yet in your current position?
    Ms. MacGregor. Quite a few times.
    Senator Cortez Masto. Wonderful. We will welcome you back. 
Let me ask you about a couple of things that are happening 
right now. Next week the BLM is expected to offer more than 
550,000 acres in White Pine Lincoln and Nye counties for 
auction as part of one of the Bureau's quarterly Nevada oil and 
gas lease sales. The surrounding cities of Mesquite and 
Henderson and local stakeholders have expressed concerns about 
the potential impact that the oil and gas production could have 
on the Hydrographic Basin 222, which is the primary source of 
culinary water for Mesquite, and I share their concerns.
    I guess my question to you is, should you be confirmed, can 
you please identify the concrete steps you will take as Deputy 
Secretary to ensure that these oil and gas leases take into 
consideration and are not on lands where we have concerns about 
drinking water along with use of recreation, wildlife, and 
wilderness areas?
    Ms. MacGregor. If I am confirmed, I will absolutely work 
with you on those issues. And I would point out in the leasing 
process we do quite a bit of environmental analysis, but we 
also do subsequent analysis prior to the issuance of any 
permit. And we will communicate with you through the entirety 
of that process.
    Senator Cortez Masto. And listen to the key stakeholders in 
the area as well.
    Ms. MacGregor. Yes.
    Senator Cortez Masto. Great. So let me ask you with respect 
to oil and gas leasing because this has been an issue for us. I 
think I have seen more oil and gas leasing happening or at 
least going up for auction in the State of Nevada under this 
current Administration unfortunately. Ruby Mountain seems to be 
the area that there seems to be a lot of interest in even 
though there is low impact or no oil and gas potential there.
    So I guess my question to you is, can you identify the 
steps you would take to limit the availability of low and no 
oil and gas potential lands included in lease sales? Because I 
think it is a waste of time. If it has already been identified 
as low or no potential for oil and gas, why do you keep 
auctioning these areas off?
    Ms. MacGregor. I think that is a fair question and a fair 
point. Under FLPMA and the Mineral Leasing Act, we are required 
to conduct quarterly sales. I know the Bureau of Land 
Management has been aiming to meet that given that it is 
subject to a Secretarial Order. Generally when we issue the 
lease sales and do a call, ultimately, it is very market-driven 
and generally leases that do not have any prospective oil and 
gas development do not receive bids. However, we can work with 
you. I have not worked specifically on that issue. I have been 
focused more in Nevada on mining, grazing, and the Fallon 
expansion, but I would be more than happy to work with you in 
the future on that.
    Senator Cortez Masto. Thank you, and I look forward to 
working with you on those other areas as well.
    Mr. Danly, let me ask you a couple of questions. Do you 
agree that renewable energy should and will continue to be an 
important part of our nation's electric mix?
    Mr. Danly. Undoubtedly.
    Senator Cortez Masto. Do you agree that renewables like 
wind and solar power can be reliably integrated into the power 
grid?
    Mr. Danly. Yes, they can be under the right circumstances. 
Yes.
    Senator Cortez Masto. Do you agree that states have the 
authority to establish the resource mix that best serves their 
customers?
    Mr. Danly. I am sorry. I didn't quite hear that.
    Senator Cortez Masto. Sure. Do you agree that the states 
have the best authority to establish the resource mix that best 
serves their customers?
    Mr. Danly. Yes. That is built into the Federal Power Act.
    Senator Cortez Masto. Okay. And do you support the FERC's 
final rule on energy storage?
    Mr. Danly. I would be reluctant to express support or not 
supporting it because should I be confirmed, I could be asked 
to pass upon it in later proceedings.
    Senator Cortez Masto. Alright. Let me ask you this, do you 
commit to working with the other four Commissioners to ensure 
that this rule is properly implemented by RTOs and ISOs?
    Mr. Danly. Absolutely.
    Senator Cortez Masto. Okay. Let me ask you this, when it 
comes to climate and environmental impacts of infrastructure 
projects, where do you see FERC's role? Does the Commission 
have the authority and or the ability to consider the impacts 
of projects on the climate when making permitting decisions?
    Mr. Danly. Thank you. The obligations of the Commission are 
to look at the infrastructure question and make a public 
interest determination based on the record in front of it, and 
that includes by the National Environmental Policy Act, 
consideration of, as I have said before, direct and indirect 
effects and cumulative impacts. So the Commission is obligated 
to take those into consideration when deciding whether or not 
something is in the public interest.
    Senator Cortez Masto. So you would agree with the Sierra 
Club case?
    Mr. Danly. The Sabal Trail?
    Senator Cortez Masto. Yes.
    Mr. Danly. I agree with the D.C. Circuit with a hands-down 
binding ruling, yes.
    Senator Cortez Masto. Thank you. I appreciate that. Thank 
you. Congratulations again.
    The Chairman. Thank you, Senator.
    Senator Lee.
    Senator Lee. Thank you very much, Madam Chair. Thanks to 
both of you for being here. I have appreciated my conversations 
with both of you in the past, and I am grateful to you for 
being willing to be considered for these positions.
    Ms. MacGregor, let us start with you. I want to talk about 
wildfires for a minute. I live in a state where two thirds of 
the land is owned by the Federal Government. The Federal 
Government is good at many things. It is not as good as some 
others are at managing large wooded properties, and at times it 
has allowed for an excessive accumulation of growth to build up 
that provides fuel for wildfires. When left untamed, those 
wildfires can become deadly. They can also become toxic for the 
environment in a way that takes decades if not centuries to 
recover from. What do you think are the biggest hurdles to 
effectively and actively managing our nation's federal lands so 
as to prevent these massive wildfires from destroying habitats 
and watersheds, destroying air quality and water quality, and 
even lives and livelihoods across the West?
    Ms. MacGregor. Thank you, Senator, for that very important 
question. Wildfire, as I said earlier, is on my mind quite a 
bit and my trip to Paradise, California, last year is still 
with me. Like you said, different states have different 
analyses on the dead and dying timber that is in their forests.
    And also depending on a wet or dry year, it could be the 
grasslands. For instance, California, I think the Forest 
Service with the state estimated that there are 129 million 
dead and dying trees. I know it's a big deal in Colorado with 
the pine bark beetle. So I think addressing invasive species 
actually comes to play but also getting in and being able to 
conduct salvage sales. Clearing out the dying timber, 
especially in proximity to homes is important.
    Senator Lee. Collaboration with states seems to go a long 
way toward addressing the wildfire risk. States in the past, 
including and especially in my own state, have done a lot to 
identify--sometimes years, sometimes decades in advance--
wildfire risk that could be nascent, inchoate at the time and 
building into something that is much more clear and present. 
And so when the federal counterparts to these state agencies 
issue warnings and encourage the federal agencies involved to 
take action, that can be helpful.
    This is also important just with land use planning, 
generally with the resource management planning process, 
collaboration is an important thing. The Department of the 
Interior has had a mixed record over the years in terms of its 
collaboration with state officials. At times--I mean, it always 
at least pays lip service to the idea that state collaboration 
is a good thing. Fortunately in this Administration, this 
Interior Department under President Trump has been very good 
about collaborating with state officials and local officials. I 
hope and expect that if you were confirmed, you would be an 
important part of making sure that that trend continues within 
the Department.
    Ms. MacGregor. Absolutely, sir. And to your point on 
wildfire, we have worked very closely with states to implement 
Good Neighbor Authority in our Rural Fire Readiness program. We 
give away excess equipment to states. We all fight fire 
together. That is really important. On resource management 
plans, I think one of the big frustrations is how long it 
takes. And you could see different employees come and go in a 
state before you actually finish a Resource Management Plan, 
which often travels along with NEPA analysis. So we are trying 
to do our best to not only incorporate the views of local 
communities, work with the Governors, but also do so in a more 
prompt manner.
    Senator Lee. Thank you. Under the Antiquities Act, the 
President of the United States has tremendous discretion to 
designate federal land as a National Monument. Previous 
administrations have made a commitment. Sometimes that 
commitment has been honored, sometimes it hasn't, that they 
would not designate a monument within a state without previous 
consultation with state and local officials and getting their 
buy-in to the greatest extent they can and not making the 
monument in the event of widespread local opposition. I assume 
you share that view?
    Ms. MacGregor. We would work to implement that, sir.
    Senator Lee. Madam Chair, I have got a few seconds left. 
May I ask one question of Mr. Danly?
    The Chairman. Yes.
    Senator Lee. Mr. Danly, can you just describe for us 
briefly what you view is the limitations on FERC's jurisdiction 
and what your vision would be as a Commissioner for FERC's 
relationship with Congress and FERC's relationship with policy 
in this area relative to Congress?
    Mr. Danly. That is a big question, Senator, so thank you.
    Senator Lee. It was either going to be that or why do bad 
things happen to good people but that was easier.
    [Laughter.]
    Mr. Danly. The Supreme Court has said that agencies are 
creatures of statute, they have no common law existence outside 
the powers delegated by Congress. So I think the single most 
important thing to say is that the Commission is a body and 
individual Commissioners are bound to honor the terms of the 
statute. Of course, the ones that we implement are the Federal 
Power Act and Natural Gas Policy Act and the Interstate 
Commerce Act for oil pipeline rates. And that is the sine qua 
non of the proper role of FERC. It is the statutory ambit and 
restricting its actions to those specifically delegated powers.
    Senator Lee. Thank you very much. Thank you, Madam Chair.
    The Chairman. Thank you, Senator Lee. Senator Cantwell, you 
are up. Senator King has been very patient, but he likes to ask 
the last question. I know that.
    Senator Cantwell. Thank you. Thank you, Madam Chair. Ms. 
MacGregor, again, congratulations on your nomination. You can 
imagine I have a lot of concerns about all the news related to 
ANWR. Do you know anything about the objections to Arctic 
drilling by Fish and Wildlife scientists?
    Ms. MacGregor. Our role in creating a leasing program for 
the Coastal Plain is directed by law, and we are doing our 
level best to implement that law.
    Senator Cantwell. So are you saying you do not know 
anything about what Fish and Wildlife scientists are saying?
    Ms. MacGregor. I know that the Bureau of Land Management 
and the Fish and Wildlife Service are working closely to ensure 
a--and have recently published an environmental impact 
statement on that particular program.
    Senator Cantwell. Will Arctic drilling harm or kill 
endangered polar bears?
    Ms. MacGregor. That biological opinion is not yet final, 
and we are waiting to review that.
    Senator Cantwell. So you dispute what scientists are saying 
in that regard?
    Ms. MacGregor. I believe that ultimately the law speaks to 
our conduct in the Coastal Plain. It has directed us to conduct 
an oil and gas program.
    Senator Cantwell. Can the Interior Department still offer 
Arctic drilling leases in 2019?
    Ms. MacGregor. How do you mean?
    Senator Cantwell. Well yesterday there was a report saying 
they were not going to offer any more leases in 2019. So I am 
just trying to clarify, can the Interior Department still offer 
those?
    Ms. MacGregor. So thank you for the question. We have 
currently published the final Environmental Impact Analysis. 
The next steps in that process are to finalize the biological 
opinion from the Fish and Wildlife Service and then to sign a 
record of decision prior to any leasing. And we are still 
working on that.
    Senator Cantwell. So it should not be a surprise to anybody 
in this whole process, we have been clear, we did not think 
that a wildlife refuge and oil drilling were consistent with 
each other and we were clear that we thought that would not 
hold up. But we are very concerned about your nomination if you 
are not going to consider the information from scientists about 
the harm to that wildlife. So we are going to continue to be 
persistent on that. And if there is anything else that you can 
clarify for the record, but we want to know that you are 
recognizing what scientists have already said.
    Mr. Danly, I know my colleague, Senator Heinrich, has 
already asked you about this issue of is coal a reliable source 
of electricity that has to be forced onto the grid which would 
raise prices for a lot of Midwest consumers and others. And I 
understand that you told him that you agreed with the previous 
decision. Is that correct?
    Mr. Danly. Thank you for the question, Senator. The FERC is 
not in the business of picking winners and losers and never has 
been. The objective that we have in regulating our markets is 
trying to get the most accurate possible price signals to 
ensure just and reasonable rates.
    Senator Cantwell. So one thing is really clear. Obviously, 
you have great familiarity with the law being the General 
Counsel there. Do you see some scenario in which that 5-0 
decision language could be revised in which somehow someone 
could make the case that yes, this particular source should be 
mandated in the mix?
    Mr. Danly. I suppose it is theoretically possible to come 
up with a hypo where that would be the case, but you have to 
remember that there are any number of emergency authorities. We 
have, I don't think there are very many, maybe two or three 
RMRs--those are our reliability must-run agreements--for plants 
to keep reliability in a couple of the RTOs. I think one in 
MISO and CAISO right now. There are powers the Secretary has in 
cases of dire emergencies under 202(c). If there were something 
like that that was acute, that would be a way to handle an 
emergent issue. But for the stability of the system generally, 
the wisest policy is to achieve the most accurate possible set 
of prices and to have the market forces follow their 
ineluctable process of ensuring the best resources.
    Senator Cantwell. So the emergency clause is the only thing 
you can think of that would be an issue?
    Mr. Danly. Yeah, I can't really think of anything off the 
top of my head right now that would be--FERC's commitment to 
market-based solutions has been, I think, pretty obvious for 
the last two decades, regardless of who has been in the 
Majority. The markets have been the centerpiece of our----
    Senator Cantwell. I only have 30 seconds----
    Mr. Danly. Oh, I'm sorry.
    Senator Cantwell. ----but I just wanted to get you on the 
record on in enforcing that market authority, one of the things 
I think has been key is having a strong bright line on anti-
manipulation. Do you believe in FERC's fraud and market 
manipulation provisions?
    Mr. Danly. Policing the markets and insuring against market 
manipulation is absolutely critical to ensure that market 
participants have faith in the markets such that the incentives 
that the markets create can actually be responded to. In the 
absence of that certainty, we can't incent the activity that we 
want.
    Senator Cantwell. Thank you. Thank you, Madam Chair.
    The Chairman. Thank you, Senator.
    Senator Hyde-Smith.
    Senator Hyde-Smith. Thank you, Chairwoman Murkowski, for 
convening this nomination hearing and I certainly want to 
congratulate Ms. MacGregor and Mr. Danly on your nominations to 
these very important positions for both of you. I have had the 
pleasure of meeting with both of them and found them to be 
extremely smart, energetic, and so ready for the positions and 
prepared for the positions they are about to embark upon.
    Mr. Danly, I certainly want to thank you again for the 
military service that you have provided to our country. The 
Federal Energy Regulatory Commission and the Department of the 
Interior have important responsibilities in Mississippi. For 
instance, energy production is an important economic driver for 
my state, particularly the tremendous amount of oil and gas 
production in the Gulf of Mexico. We are proud of the 8 
national parks and 15 wildlife refuges in Mississippi. The 
refuges draw hundreds of thousands of visitors each year, and 
it certainly helps our tourism in Mississippi bringing these 
people in with such a wonderful experience.
    In addition, I want to recognize the important work that is 
done by the Department of the Interior's U.S. Geological 
Survey, particularly the hydrologic instrumentation facility at 
Stennis Space on the Mississippi Gulf Coast that I toured just 
recently. Ms. MacGregor, one issue that has drawn a 
considerable amount of attention in recent months is the 
catastrophic flooding in the Mississippi Delta. Hundreds of 
thousands of acres of land were underwater for more than six 
months, affecting so much of our farming operation, 
agricultural land, timberland, wildlife habitat, and of course, 
our homes and our communities, and churches and schools. 
Included in the flooded area were a number of national wildlife 
refuges with more than 100,000 acres of prime wildlife habitat. 
I want you to be aware of the significant damages that have 
occurred as a result of almost annual flooding events over the 
past decade and the historic flood disaster that we certainly 
suffered this year. I recognize flood reduction is not Interior 
Department's primary mission, but I hope you will recognize the 
impact of those damages and the need for an environmentally 
sustainable flood reduction solution.
    Also, I am eager to continue the progress we have made on 
finding solutions to address the bird predation losses for 
aquaculture and our livestock. We raise a lot of catfish in 
Mississippi. We are the number one catfish state in production.
    In addition, I am very interested in continuing the work 
with your Agency to allow agriculture producers to use all 
federal registered seeding and crop protection products and 
farming operations on the lands that you do oversee.
    Again, thank you both for your willingness to serve, and I 
look forward to working with both of you as you develop 
policies to protect and strengthen our nation's energy and 
natural resources. I think you both would do a fantastic job.
    Mr. Danly. Thank you.
    Ms. MacGregor. Thank you, Senator.
    The Chairman. Thank you, Senator.
    Senator King.
    Senator King. Thank you, Madam Chair. Ms. MacGregor, in 
your answers to Senator Alexander at the beginning, I was a 
little concerned. He asked you, do you support the Restore Our 
Parks Act and you said we support helping the parks. Do you 
support the Restore Our Parks Act?
    Ms. MacGregor. We support those bills, yes.
    Senator King. Thank you. I just wanted to be clear. We are 
not--there is no retrenchment of the Administration's support 
for this bill?
    Ms. MacGregor. Sir, no. I believe there are some variations 
between the House and Senate bill and we want to work with you 
as you separately move those pieces of legislation forward.
    Senator King. Thank you.
    On offshore drilling I was delighted to hear your answer to 
Senator Lee's question about collaboration and cooperation with 
state officials. In the State of Maine, our legislature, our 
governor, and our entire Congressional delegation are adamantly 
opposed to offshore drilling off our coast. Will you take the 
same view of the importance of collaboration with state 
officials in that situation?
    Ms. MacGregor. Absolutely, sir. 43 U.S.C. 1344 is where we 
get direction on the administration of the leasing program, and 
it requires our work with the governors in the state and local 
governments.
    Senator King. And you will absolutely respect that 
provision?
    Ms. MacGregor. We will absolutely work every step of the 
way. We shall work as directed in the law.
    Senator King. Are there any plans for drilling or 
exploration off the New England coast today?
    Ms. MacGregor. I think the Secretary's statement that a 
five-year plan is not imminent right now is correct. We are 
evaluating the impact of separate litigation on that program.
    Senator King. In government time, I suspect not imminent 
maybe means we are okay for the rest of this century. I 
appreciate that. On the question of fossil fuels and there is 
some discussion with you, with several Senators. I was at a 
scientific briefing yesterday that presented a graph that 
really shocked me. I had not really thought about it before. We 
always talk about fossil fuels in terms of climate change and 
the effect of CO2 in the atmosphere, but the other 
thing is in the space between our grandparents' birth and our 
grandchildren's death we are going to use up essentially all 
the fossil fuel but it took hundreds of millions of years on 
this planet to create.
    I just offer that as a thought forgetting about the 
environmental effects, which are severe, but the very fact that 
in a sense our generation, our memory of generation is using up 
something that is a finite resource on the planet, I find 
disturbing. As we go into Thanksgiving, I think of dad sitting 
at the end of the table, the turkey comes, all the kids are 
sitting there, and dad says I am going to eat all of it. And 
that is what we are doing. I think that is unconscionable from 
the point of view of simply stewardship of a resource let alone 
environmental stewardship. There is not a question there, but 
that was something I thought was important.
    Budget changes. In your budget of your Department, the 
Bureau of Ocean Energy Management (BOEM), there is a $1 million 
reduction in renewable science and technology research and an 
$8 million increase in what is called conventional energy 
budget. Why in the world at a time of concern about extra 
utilization and over utilization of fossil fuels are you 
cutting research on ocean energy development?
    Ms. MacGregor. Sir, in formulating the budget we worked 
with the Bureau of Ocean Energy Management. I would point out 
that renewable energy is still an important part of the mission 
of BOEM. I have personally been working on a potential offshore 
California wind sale. We are working within the confines of our 
budget as it is provided.
    Senator King. Well, I understand that but budgets--a wise 
man once said budgets are policy and when a budget cuts in one 
area increases in another area, that is almost a billion 
dollars of offshore energy research. It seems to me that is a 
statement of policy that this is not a high priority for this 
Administration.
    Ms. MacGregor. This remains a priority in our statutes as 
well for BOEM, and we are working closely on all permitting and 
leasing that we can achieve for offshore wind energy.
    Senator King. Mr. Danly, FERC has taken steps in the past 
to reduce barriers for distributed energy resources (DERs), 
storage, and the like. You have taken a rather, I do not know 
what to call it, balls and strikes position, a conservative 
``we don't have the jurisdiction to be making policy'' kind of 
position. How do you feel about those efforts to, I believe, 
recognize the value of DERs and storage to the security and the 
efficiency of the grid?
    Mr. Danly. Thank you for the question, Senator. So without 
getting into the specifics of either of those two possible 
resources----
    Senator King. I am really looking for your feelings about 
the concept of incorporating these kinds of resources into the 
grid.
    Mr. Danly. So as I mentioned in my opening statement, I 
think one of the most amazing things about FERC is that it is 
administrating a century old statute and in the process is 
overseeing dramatic transformations of the electricity system. 
And I would certainly hope to see FERC continue to do that sort 
of work. Things like--technologies like storage provide a 
tantalizing glimpse into what the future of the electric system 
could be and I think it is incumbent upon FERC--in our 
discharging of its duties to ensure just and reasonable rates, 
it is incumbent upon FERC to try to allow as many of those 
technologies as possible as much access to the system as we 
can.
    Senator King. I appreciate that and I appreciate your work, 
but I think the important thing is that the values have to be 
in the equation, the intangible values, and I think that is an 
important part. Thank you very much for your testimony.
    Thank you, Madam Chair.
    The Chairman. Thank you, Senator.
    Senator Hoeven.
    Senator Hoeven. Thank you, Madam Chairman. Ms. MacGregor, 
if confirmed, will you work with us to fill BIA law enforcement 
officers in the Great Plains area? We have a real need for law 
enforcement officers particularly throughout the upper Great 
Plains on the reservation. Will you help us work to fill those?
    Ms. MacGregor. Sir, absolutely. We will work with you on 
BIA law enforcement writ large.
    Senator Hoeven. And I want to thank you for visiting with 
me earlier. I appreciate it. We also talked about the Red River 
Valley water supply project. Are you willing to help us in that 
regard?
    Ms. MacGregor. Yes, sir. We will work with you.
    Senator Hoeven. Also, you are committed to producing more 
energy on federal lands and tribal lands. I mean, you know 
tribes are sovereign but a lot of them want to produce more 
energy, some traditional, some renewable. Are you committed to 
do both?
    Ms. MacGregor. We are and that has been a highlight, I 
believe, of our Fiscal Year. Even on tribal energy, we have 
increased revenues and production.
    Senator Hoeven. Talk for a minute about how we can expedite 
the permitting process on BLM lands or federal lands and also 
working with tribes. How do we make sure that, you know, we do 
it right, we do it well, but we get through it? I mean this is 
about encouraging entrepreneurship and investment, creating 
jobs and economic opportunity, willing to do it with good 
environmental stewardship. We do not want red tape, we want a 
good process. How do we do that?
    Ms. MacGregor. Sir, that I know is important to your state, 
to Wyoming, to New Mexico, and many states, and it isn't just 
for permitting oil and gas. Permitting writ large, for 
instance, if you wanted to permit rural communications towers 
for broadband, it has to go through a permitting process. And I 
think we are learning efficiencies through every branch and 
many ways through the Bureau of Land Management. When we 
started at Interior, the average permitting timeframe for an 
APD was roughly 257 days, and through simply using 
accountability, working with state offices, filling vacancies 
in some cases, we have been able to bring that permitting 
timeframe down to right now 108 days, and it varies in 
different offices. The statute requires us to do it in 30 days. 
That is pretty difficult. But we are going to work to make and 
utilize ways to make permitting more efficient.
    Senator Hoeven. Good, thank you. Again, I know Senator King 
asked you about the Restore Our Parks Act and you are committed 
to that, I think, as we have discussed. I think you responded 
to him.
    Ms. MacGregor. Yes.
    Senator Hoeven. And also in Theodore Roosevelt National 
Park, you and I talked and this is again more parochial, our 
issue but, you know, we have a road failure out there, mission 
critical, and we need your help with that. We have discussed 
that.
    Ms. MacGregor. We want to absolutely help you and work on 
that road. Of the backlog, most of our backlog for National 
Park Service is our roads. And I think it is 100,000 miles of 
roads. So we have a lot of work cut out for us, and we 
appreciate the bipartisan support we have been getting on 
dealing with that backlog.
    Senator Hoeven. Thank you. I appreciate it.
    Mr. Danly, we need to do something in regard to baseload 
generation as far as transmission. You have baseload that is 
there. I am thinking that the Ranking Member probably brought 
it up because he has a lot of coal in his state just as we do, 
and we have to have something that addresses the fact that coal 
is there, you know, 24/7 on the coldest day, the hottest day, 
when the wind blows, when it does not blow.
    In a lot of cases, they built that transmission and other 
types of energy have a preference on the transmission that they 
have built. What do we do to make sure that we are treating 
baseload fairly and that we have that energy available when we 
need it in terms of the transmission, the grid and, you know, 
the ability to use it and so forth?
    Mr. Danly. Thank you, Senator. So as you are aware, FERC's 
jurisdiction extends to the transmission rates. Of course, not 
the actual siting or construction----
    Senator Hoeven. Right. And that is what I am getting at.
    Mr. Danly. Yeah. And so the proper--not the proper tool, in 
fact, the only tool available to the Commission to encourage 
build-out of transmission infrastructure is in the rates 
scheme.
    And I take your point very seriously that there could be 
assets that are effectively stranded on the transmission system 
that have plenty of power that they could produce. They could 
be in the blank otherwise and because of the constraints on the 
transmission system, they are simply out of luck and nobody is 
able to benefit from the dispatch of those units. This is one 
of the considerations that is always taken into account when 
new transmission projects are either being proposed or planned. 
And so it comes down to FERC's oversight of the transmission 
rates.
    Senator Hoeven. I am not sure though if that was a yes or 
no.
    Mr. Danly. I am not sure what the yes or no question was.
    Senator Hoeven. We need something that takes into account 
the fact that the baseload is there all the time and right now 
some of the variable systems have preference in terms of the 
rates and access on transmission lines. And we have to do 
something to address that. Do you agree with that?
    Mr. Danly. I agree that the transmission system has to be 
designed and operated for the purpose of ensuring the best 
possible dispatch of the most efficient units. And those units 
are in many cases what you are terming baseload.
    Senator Hoeven. Do you think, based on your experience, you 
have the ability to help us solve this issue with baseload? 
That we can come up with some good solutions and that you can 
be part of that?
    Mr. Danly. I would be delighted to assist in working on any 
of this----
    Senator Hoeven. You are committed to working on it. And you 
recognize there is a challenge that has to be dealt with?
    Mr. Danly. Absolutely. The transition from the old dinosaur 
era of vertically integrated utilities to these to the rightist 
cacophony of the current market system has been a challenge and 
there are many problems that have arisen along the way. But I 
would argue that the electric system is better for it, and I am 
happy to work on any of the subjects with you.
    Senator Hoeven. Yes, and one other question. Are you 
willing to ensure that states and local shareholders maintain 
the ability to make decisions over distribution and that you 
would be responsive to them in that regard?
    Mr. Danly. Distribution is firmly placed within the hands 
of the states under the FPA, and I support that.
    Senator Hoeven. Okay. Thank you. Thank you, Madam Chair----
    The Chairman. Thank you, sir.
    Senator Hoeven. ----and to the Ranking Member too. I 
certainly would not want to leave him out.
    The Chairman. Yes, do not leave him out. Do not leave him 
out. I just have a few, perhaps a little more parochial, 
questions. Ms. MacGregor, you and I spoke about some of this 
earlier, but we have a very unique relationship between Alaska 
tribes and the Federal Government following the Alaska Native 
Claims Settlement Act (ANCSA). Because of ANCSA, as you know, 
there is almost no Indian country or reservation land in the 
state. We are now approaching the 50th anniversary of ANCSA's 
enactment, but many of the commitments that were made by that 
law are yet to see fruition. So I just need to know that you 
will continue to work with us to ensure that the Federal 
Government's commitments to Alaska Natives under ANCSA are met.
    Ms. MacGregor. Absolutely, Senator. And we have a 
consultation process in place at the Department when it comes 
to ANCSA corporations, and we are implementing them.
    The Chairman. Well I appreciate that because as we hear far 
too often, there are many back home who feel that consultation 
is seemingly a check the box exercise and it needs to be 
meaningful consultation. Some agencies are better than others 
but, again, I am seeking your commitment to ensure that it is 
true and meaningful consultation.
    I mentioned the Public Land Orders, section 17(d) of ANCSA, 
gave the Secretary of the Interior the authority to withdraw 
lands for further study and reclassify them for use in the 
public interest. It was smart at the time when the selections 
were being made. The problem is that now, some 50 years later, 
much of this land remains withdrawn and has yet to be 
reclassified. There have been some PLOs that have been lifted 
in this year. We appreciate that. We know that there is more 
work to be done. Again, I am just seeking your commitment to 
that and that we continue in that vein and work to complete 
some of these PLOs.
    Ms. MacGregor. Yes. We will work with you on those.
    The Chairman. Last one, and this should be a no-brainer. It 
just stuns me that we are still arguing, going back and forth, 
regarding the Gustavus Hydro Intertie-Connection project with 
National Park Service at Glacier Bay National Park. This is 
something that is so easy. It should have been such a win-win. 
It gives clean affordable energy to Glacier Bay National Park, 
it helps the community of Gustavus out. It is something that 
should have been done years ago and I am told we are always 
getting closer, but I need to know that we are going to keep 
this project on track and get this contract awarded. So if you 
can just make sure that that is being bird-dogged 
appropriately.
    Ms. MacGregor. Senator, strong renewable hydropower is 
important to the Department, and we will work with you on that. 
That is the first I am hearing of this project, so I will look 
into it.
    The Chairman. It won't be your last. Lucky you. Thank you 
for that. I had really hoped I would never have to raise it 
again to anybody within Department of the Interior because, 
again, it is something that we have been working on for a 
decade plus and it really is----
    Ms. MacGregor. I wrote it down.
    The Chairman. Very good. Thank you. We appreciate that. We 
invite you out to Glacier Bay National Park.
    Mr. Danly, in the Southeastern part of the state, Alaska 
hydropower is everything for us. It is about half of our power 
generation, and we are proud of what we do and how we do it. As 
I look through and as we have conversations about the role that 
hydropower plays, it continues to amaze me that we are in this 
process that approvals for issuing either new licenses or 
relicensing existing dams can take over a decade, can cost tens 
of millions of dollars. We received testimony here in the 
Committee that obtaining a license renewal routinely exceeds 
$20 million per license with some proceedings topping $50 
million. Again, these are renewals.
    And so we hear in the Committee that some of the costs and 
the delays are due to lack of coordination among FERC and the 
resource agencies--sometimes redundant reviews at the federal 
and state levels. So this is a matter that we are looking at 
critically here in the Committee. And as an add-on to that, we 
have also had an opportunity to focus on hydropower pump 
storage and recognition that 95 percent of energy storage in 
the U.S. and globally with 44,000 megawatts of proposed 
projects are before the FERC right now in the preliminary 
stage. So you are looking at a double of U.S. pump storage 
capacity.
    As we are looking to what we can be doing to make this 
process a better process and FERC's role in it, I would ask 
that you consider and perhaps you have some impressions you 
would like to share with me right now about how the hydropower 
licensing process can be improved and whether or not you think 
the hydropower and the pump storage projects are being properly 
valued and fairly compensated for the grid reliability services 
that they provide?
    Mr. Danly. Thank you for the question, Senator. One of the 
most important functions we have is permitting infrastructure 
of various types, this includes the section 1 responsibilities 
for hydro. And it is absolutely essential that the Commission 
do everything it can to expeditiously review all of the 
applications that it has in front of it. It has been an ongoing 
issue that has been raised many times, how long it takes for 
hydro to be approved. And part of that is that there have been 
historical frictions in getting coordination.
    Also, these are very significant projects that have their 
dire consequences for bad oversight and so the i's are dotted 
and t's are crossed, and that is just part of what is going to 
have to happen in any hydro licensing regime. But I am 
absolutely dedicated to the most expedient possible review of 
every application in front of us, and I would be delighted to 
work with you on that should I be lucky enough to be confirmed.
    The Chairman. Well, I would like to explore it a little bit 
more in detail because as you mentioned that yes, some of these 
projects are really significant projects within their region. I 
am taking it back to where I am from where we have smaller 
hydro projects that really should not be as challenging as they 
are, should not be as complicated and expensive. And so how we 
can work to address that I think is a challenge for all of us. 
Coordination with the agencies is something that--it just makes 
good common sense to do it. So note that that is an area of 
keen interest of mine, that and what we are doing to help 
facilitate the hydro pump storage as well.
    Senator Manchin.
    Senator Manchin. Thank you, Madam Chairman. And thank you 
all. It has been a very good hearing. I think you had a good 
exchange. You had a little lively audience participation.
    [Laughter.]
    So it has all worked out well. With that, I just have two 
final questions.
    Ms. MacGregor to you. I introduced a bill to extend the 
Abandoned Mine Land (AML) Reclamation Act for another 15 years, 
and I think you are familiar with AML. Basically $11 billion 
has been collected in its life over the last 15 years, and we 
have about $10 billion of identified reclamation that needs to 
be done and that comes from the fee on extraction of fossil, of 
coal, and we are asking for that. I do not know what your 
position would be on that. Do you support us?
    Ms. MacGregor. Sir, I am from the Commonwealth of 
Pennsylvania. We have some Appalachia too. It is really 
important. A lot of the AML projects are also funded in the 
State of Pennsylvania. So I know that Congress is working on 
reauthorizing that program, and we will work with you on that.
    Senator Manchin. So you support extending the fee for 
another 15 years, if possible?
    Ms. MacGregor. We will work with you on AML.
    Senator Manchin. I understand. Well, we need your help. We 
really do. If you can just basically identify the good it has 
done and why the fee is needed. If not, the money will be 
replaced somewhere, and now it comes from the extraction so the 
industry is paying for itself. It makes a lot of sense not to 
put the burden on the average taxpayer.
    Ms. MacGregor. We absolutely think AML is an important 
program, and we want to work with you on that.
    Senator Manchin. Thank you.
    Mr. Danly, security of the electric grid has a great 
importance to me. I have sat on the Intel Committee before, so 
I know the threats that we receive minute-by-minute to our 
country. I had the privilege of going out and seeing the attack 
on the Saudi Aramco oil refineries and seeing how it could have 
disrupted the whole oil and energy industry for our whole 
globe.
    With that, I am a proud co-sponsor on the PROTECT Act with 
Senator Murkowski. The PROTECT Act, as you know, would require 
FERC to issue rulemaking establishing rate incentives to 
encourage cybersecurity. So rate incentives, we are all paying 
basically, but we understand that the security and the cyber 
threat that we face could be very damaging to all of us. What 
do you see FERC's role to be with respect to protecting the 
grid from cyber? Do you think it is a real threat, a concerted 
threat that we could be alleviating or minimizing?
    Mr. Danly. Thank you for the question, Senator. Yes, 
cybersecurity threats are truly, truly important, and the scope 
of the threats faced are sobering. We have, as you are aware, 
limited processes to make mandatory standards and when it comes 
to a field like cyber, the rate at which the NERC process, 
which is the liability process, the rate at which a NERC 
standard comes out, you know, 18 months to 2 years for anything 
when it comes to the world of cyber, it's already ancient 
history. And so what FERC does to try to bridge that gap is we 
have an Office of Energy Infrastructure Security which does 
best practices and architectural reviews and the like in order 
to enhance the awareness of the jurisdictional utilities to the 
threats. As to the question of ratemaking, I am all for 
Congress having specific subjects that it wants to direct 
ratemaking on and, in fact, sometimes in the past FERC itself 
has done single-issue ratemaking--immediately after 9/11. I do 
not remember the exact date of the issuance, but single-issue 
ratemaking was explicitly contemplated by the Commission for 
the purpose of physical security. So as far as that goes as a 
ratemaking regime, I have no objection to it whatever.
    Senator Manchin. Well on this, the thing that amazed me is 
the attack on Aramco. Have you all seen the news reports on 
that? There is no doubt where the attacks came from. Every 
missile hit from the North and then hit from the South. With 
that being said, I asked Aramco officials, I said, are you all 
concerned about espionage and how someone would have this 
pertinent information and the coordinates to do the damage they 
have done? He looked at me and he said, ``That is a 
consideration. We do a very extensive job as far as reviewing 
any of our employees and we understand that, but we cannot 
compensate for Google Maps.'' And I said, what? And he said 
``Google Maps.'' He says Google Maps are so precise that they 
were able to get all their information off those. I kept 
thinking about our cyber vulnerability, because I can assure 
you it does not take much to take us down.
    If that can be done, can you imagine what could be done to 
this great country? So I am concerned about that very much, and 
I would hope that you would be supportive of the PROTECT Act. 
When it comes to the importance of cyber, because of the 
challenges we are facing, and what we are facing every day from 
terrorist threats, something as vulnerable as that, it could be 
catastrophic to our country. I would hope that you all will 
consider that protection, as well as we talked about Ms. 
MacGregor on yours. Those are very, very critical. AML, cyber, 
two big things.
    Mr. Danly. Absolutely. I think it is very important.
    Senator Manchin. Thank you all for being here today.
    The Chairman. Thank you, Senator Manchin. Before we wrap 
up, I want to say a few words about somebody who is going to be 
leaving my team here on Energy. We have had a gentleman who has 
been with the Committee now for about eight years, Chester 
Carson. Chester is not here. He probably knew that we were 
going to say something about him, but Chester comes from 
Juneau, Alaska. I am not quite sure how we were able to lure 
him here to Washington, DC, but he came not only to the 
Committee but he was one who started out as an Executive 
Assistant before he moved into the comms shop and then he went 
from comms to full-time policy advisor.
    So when you think about those who really rise through the 
ranks, Chester is one of those. He has been my lead on so many 
of the issues that we have actually been talking about here 
today--renewables, efficiency, climate, tribal energy. He has 
made some significant contributions to the Committee, and he 
has done so with enthusiasm and a smile on his face. I am not 
quite sure what has struck him, but this young man from Alaska 
has decided that Hawaii is now calling to him. So he moved from 
Alaska to DC to now Maui. We wish him all of the aloha and 
mahalo for the work that he has done. But I wanted to be able 
to acknowledge him here before the Committee.
    I want to thank both of you this morning. This has been a 
good hearing. I think you have seen very personally the level 
of interest from so many of the members on the Committee. We 
had really strong attendance here this morning, a morning when 
quite honestly, we are not set to have votes for a little bit. 
Usually you have a lot of people that are still traveling on a 
morning like this, but I think they made a special effort to be 
here.
    I think both of you provided good strong information to the 
Committee on important issues that we care about, that you care 
about. You have clearly demonstrated your competence in your 
fields, the depth of knowledge, and really, your willingness, 
your desire to serve at the Department of the Interior and at 
the Federal Energy Regulatory Commission.
    So I thank you for not only being here this morning, but I 
thank you for your respective leadership. I thank you for 
bringing your friends and family here to support you. We know 
the jobs that we all have are tough jobs, and they are made a 
little bit easier when we have those that are loyal always.
    We thank you for joining us, and we thank you all again for 
your commitment. With that, the Committee stands adjourned.
    [Whereupon, at 11:57 a.m., the hearing was adjourned.]

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