Transcripts For CSPAN2 Today In Washington 20100310

>> in other words it is the locality that has to obligate the funds and go through the neck and a chance necessary. it isn't you that goes into the ground eda. let me ask you if there is -- to people compete for this little bit of money militant to what some people like the gsa or for that matter the transnet folks had? you had 147 million country. you have cities in the united states, my own city, for example, has 12% unemployment. that's typical of big cities in the united states. uni geared toward the big cities, but you're certainly geared towards the most depressed areas of the country. was there any -- is there any correlation between the unemployment rate and the localities that one these contracts and the contract with success in winning a contract? in other words, can you tell me that the hardest hit areas in fact argue about this entire amount of obligated funds? >> i can't say that absolutely in terms of the projects that were funded were in the -- the >> no, you see that is really not my question. all of your projects come from hard-hit areas. >> correct. >> you can go to some states and find the price is. or example, pennsylvaa has a lower unemployment rate than i thought it would have heard i am asking whether there was a criteria among those used towards contracts that went to the unemployment rate like >> yes, in fact i appreciate you clarifying that for me. the eda's programs are specifically limited to eligible areas. and not eligibility is based on unemployment numbers as well as averaging incomes. we typically use at eda 824 month lag period. and that's by statute to determine eligibility. with the recovery act, we actually had an opportunity to find two are criteria and we used a shorter. to reflect the urgent nature of the recovery act. so in that case -- >> it would be helpful if you would submit to the committee and i would like to make sure i get a copy, the list of those who applied and they are unemployment rate versus those who succeeded and their unemployment rates that we can see that correlation. it's an important one. it would help to clarify this matter. i have a question for you and for mr. peck that is the same genre question. you of obligated all of your money, but then apparently you've broken ground on 20 of the projects and that would mean 45 million of the 147 million that's 31% of the amount allocated. >> correct. >> now, one of the great issues that had arisen in the series, my own tracking hearings and the series is the jargon and the difference between obligation and outlays. now, the gsa has the same issue, 2.1 billion obligated, but only 184 million outlays. now, as far as the public is concerned, obligation may not mean very much. we know it is very pregnant with meaning. but one of the reasons that there may be dissatisfaction with stimulus is we keep talking about large amounts of money, but people do not see that money on the ground, even in the case at eda, where all of your money has been allocated. i would like each of you to respond concerning outlays, which means that people on the ground, you're floating money out there to pay somebody is on the ground, whereas obligation, as far as we understand it, means that the money in the bank waiting to go on the ground. so, mr. peck or mr. fernandez, which if you would like to explain the discrepancy between obligation on outlays and your own figures today? >> you know, i think it's pretty -- i mean, it's a pretty relevant point. in our case 100% of our progress will actually be initiated by july 1 of this year. >> say that again. >> you know, today, we reported a percentage of our projects of argument started in terms of breaking ground. as you noted earlier, in some cases, construction projects in all cases in fact for eda are run a reimbursable basis. so a project may actually start, but we won't disperse until the request for reimbursement. >> i will be pretty quickly. people haven't worked long without being paid. >> you'd be surprised in terms of how some of our local agencies are more urgent about reimbursement than others. >> you think the problem is that the local level. >> no, i think the issue is that with construction projects there's often complex work that has to be completed before you can break ground. my point is that by july 1 of this year, 100% of our projects will be initiated in terms of the work, the designs will be completed, the ground will be broke. >> all 60 grants will have ground broken. >> yes. >> now, that's important. mr. peck, what's important is we begin. in february the bill passed. i party has some of this. has been the winter, but some of it does not in the winter. part of the spring of course was the tooling up after we passed the bill. but in your case as well, we have this huge amount -- you seem to be on track to in fact get it spent, excuse me, get it obligated. i'm very pleased with after a great deal of trouble, you have done very good work with the apprenticeship so that we begin to see something really happened to that, congratulate you on not. but to a point, 2.1 are obligated to see only 184 million, which means somebody is being paid as a matter of some concern. >> let me take either a couple of different kinds of projects. but for some numbers. we have over 300 projects, we have 92 when the construction phase, which means money is going to start to flow. and as i said, by september -- by now were a 10% of the ratio of outlays to obligation of actual spending two obligations. by september will be up to about 25%, 26%. >> are you on track knowing that essentially the building. is coming up, that she know what disorders between late march -- what is it a six month period or so. you tell me when, if you want jobs, those jobs essentially are going to be created in on the ground in the spring, summer, early fall months. >> depends on the area. we're building in the border station of calexico. but there's no snow for sure. but your rights in a lot of areas, it's seasonal. and a large product, here's what happened. take a large modernization, which we had to hire an architect or a large new building. we've had a lot of instances in which architect and engineers have worked around the clock to finish their designs. when they finished the design, their job stopped and then there is a little bit of a black because we produce construction documents. we go out to bid. takes a couple of minutes to get the bid on complex projects. we've done everything we can to streamline, fast-track the contract and then it takes a while before the buildings go in the ground eared bats one issue. second however, is well worth doing matt and i think this is important to note. we don't track it. we have been very conservative about what we claim as job retention and job creation so that when we award a contract to a contract your and their people know they're going to have a job coming, that contractor can borrow and keep people on the payroll who otherwise might have been let go. >> do you know how many jobs you expect to be created by this -- your portion of the stimulus fund? >> we are -- by the end, it should be around 60,000 jobs. and we will have about 10,000 -- we've changed the way we measure. were doing a quarterly that and not cumulatively. but by the end of september, we will have 10,000 jobs created. >> thank you very much. >> time has expired here at mr. brown. >> thank you, madam chair. ms. secretary, in south carolina it was one of those states that did get a 10 billion-dollar grant to continue the funding firm ice 73. and i noticed in part of the criteria, you could use it either as a grant or you could use it as a subsidy of ministry assistance. tell me how that works. and i guess the statesould make the choice or as part of the funding mechanism -- >> is a very good question, sir. first, as you know, there were far more products than we had funding. i 73 is a good example of a barely badly needed but also very expensive highway project that would be the direct connection to myrtle beach. what this does is gives the states the option of either using that, what we call a challenge grant, to either cover the tv a subsidy for it alone or to use it for an element of the project financing that they'd like to do. the idea would be -- it can be a catalyst to the financing package for a project of that scope and we will be flexible with the state and how they want to proceed. the indications we've gone from different states on this process is there going to probably approach it in different ways. one wanted to do is give you the maximum flexibility and use this as a catalyst to get the project going. >> do you think this is sort of, you know, forward a little bit to look at the job bill that's been created. i guess, did the senate passed yesterday, is that correct? >> gas. >> and how many dollars worth of highway funding is going to be in that bill? >> 38 billion i believe. >> we would presume that it would operate to sensually the same way that the recovery act funding dead so the same types of projects would typically be eligible. the time frames would presumably be similar. we are geared up and ready to go for it. >> does that mean the money will be back to the states through some kind of formula, whether it be where it actually will be allocated by grant? >> like the recovery act, we would anticipate that it would work both boys. the majority of the will be formula the way the states are used with now, but there would also be an ability through t.i.g.e.r. grants to do the same thing that we did with these, which is fun projects that don't easily fit into any of these other categories. i would point out also that in our fiscal geared 2010 funding, there will be another round of t.i.g.e.r. grants. we expect to award those by the end of this calendar year. so the types of projects and some of the specific projects that applied for but did not get funding and the sound could be eligible for the next round. and we have been encouraging applicants that were not successful in this round to come in for a debriefing that we can maximize their opportunities for this next $600 million. >> so you'll ask for additional grants and he'll be able to use the same grants and go back requalify. >> they will have to resubmit -- we are required to actually put out a separate notice of availability, which were doing. but essentially, you can take those same applications, strengthen them. and again, we encourage people to get a db from us. >> that was about a $300 million request i guess for i-73 and we get 10 million, but in south carolina is one of those states that they mention the 12.6% unemployment. in this particular region and in the parts of south carolina, approaching 20%. so this would be a win-win for us as we could exceed that somehow. and whether thing, just a side note, madam chair, back in south carolina, we were able to create in this committee what you call an infrastructure bank. i know we've been talking about that as we go to the reacquisition bill for the next highway bill. but i don't know exactly how far you've actually taken a look at it. it seems like we need some way to leverage the funding we have two maximize the project so we can create more jobs. so i thought that maybe another tool we can use. >> it certainly is another tool. and in the presidents budget, a proposed infrastructure fund as part of the proposal. an infrastructure bank like proposal, which would be another tool in the toolbox for these projects. and again, on i-73, we do recognize both the need and the economic distress of the area. that's a great illustration of a project that would be jobs in the short-term and long-term reinvestment, that from an economic development point of view is up year after year. >> i just think it's a window of opportunity that we find out today that if we spend the money for infrastructure improvements, we know the economy is going to come back and then we're going to have an infrastructure that is going to be able to move the commerce and create jobs in the future. anyways, thank you for your service. thank you, madam chair. >> thank you very much, mr. brown. >> thank you premeds, noah to piggyback on what congressman brown just that. because one of the things about this committee and i want to use this disclaimer here that one of the things i have enjoyed about being on this committee is the nature of the bipartisanship of this committee and that we work together. and we worked together on all of the issues. and i want to be clear that this administration, the president, the vice president and secretary lahood has worked with this chairperson and with the ranking member as for high-speed rail is concerned. and i want everybody to be clear that they have worked with us do diligently. they have come to florida. they have talked to the florida officials. and i am very pleased that we've had transparency as far as the projects are concerned, as far as high-speed is concerned in this country. and i just want to get that on the record before we get started. and also about the stimulus, let me tell you, because mr. oberstar and the hearings that we are having today and the hearings that we have had, we can truly say that we know how the dollars have been spent. we can piggyback on the states that have received the dollars and where those dollars are. and members of congress into the city council, to every single level we have been able to contact the officials and make them move those dollars go. and so i just want to put that on the record. this is bipartisanship. i don't understand how sometimes the rhetoric breaks down for whatever the moment of the time. but i want to be cleared that i am very pleased with this administration. and in fact i asked are going to have hearings in florida. were going to take it to florida and california, but i want to go to to were three cities in florida because we have benefited from high-speed and it's an example of how this country can benefit with high-speed. and it can change the complex of this country. i mean, 50 years ago when eisenhower and the members of congress decided to do the highway system, that was great for the country. now we're at a new area. all of our competitors are moving forward. i just returned from germany where you can get on a train and you can go 200 miles in less than an hour. that's the future of this counan bipartisanay now, let's go to mr. carpenter. would you please tell me -- and in my questions, i'm very happy with the project that you did in stamford, florida. but the president of the vice president was one of the first announcements that is both in my district. can you tell is how many jobs that's going to generate? >> how many specific jobs? i can play that specifically today, congresswoman. but i would be happy to get that to you very quickly. >> while i can tell you we are very excited about the project. when we go back to mr. peck. one of the things that you talked about. and my question is, why is it that we don't do more design bills because basically it takes months to plan and then months to get it out. why can't we do -- have some were demonstrated projects that show the design build because that would actually really put people to work and cut down on the number -- the amount of time. we've done some of that and i'm very pleased with the project. i don't understand why it takes us, let's say, you know, five years to build a hospital, where the private sector right next-door can do it in 18 months. and this is a democrat talking here. >> eurotech intuit private sector real estate person, too. and in the recovery art projects, we are doing a plot of the design build because it does speed up the process. you know, the reason i think traditionally we haven't done them so much as some of our products and trends projects have had longer lead times and getting agreement from agencies and complex. not a good excuse. were doing a lot more design build. where else he is in another process called to construct your, the construction manager which allows us to fast-track the design and get a builder on board early guns of the architecture of builders are working together at an early stage in the process. >> so this will help expedite some of these projects? >> yes, ma'am. >> can you mr. porcari, tell us about the tyler grants on said to grants. we got a big initial round, but there will be other rounds but this up to grants. tell us for everyone in the room who is interested in the set to grants. it was one of the hottest items all of the country. people have projects that didn't actually fit into certain categories. and so there is a great deal of pent-up desire. i think you have to see many applications for a limited amount of money i >> we received $60 billion with a request for $1.5 billion with the funding. and you're correct, ma'am, it is a great program and that projects at our regional or national significance that don't necessarily fit into one of her 108 stovepipes of programs, were eligible for this. and if you look at the reports around the country, these are projects that for the most part typically can't get funded any other way, but are critically important from an economic development competitiveness and job's point of view. so we were evaluating things like the performance, the existing systems, whether it was highway, freight rail, ports or any others, livability, environmental sustainability. those are some of the explicit goals that we have in this program. and as you point out, there is another round. it was $1.5 billion nationwide. the next round will be $600 million. it will be awarded by the end of this calendar year. >> thank you and i want to thank you all for what you are doing. we receive less than 4% of the money but are generated about 50% of the jobs it to thank you again. >> thank you, madam chairwoman. kind of piggybacking on what congressman brown said. one of the pleasures of working on this is that it is not bipartisan. and frankly, this chairman has been emphatic and make each of the money has been well spent. we have to be emphatic because the scene where some of the css can't elsewhere. funds go into congressional districts that don't exist. stimulus funds going to political campaign consultants. note that happens in another country, we don't call it waste. we call it corruption. but this committee and this chairman, chairman oberstar has been dead set against letting that happen at least in the area this committee has oversight and once again i need to commend this chairman and this committee for that. i do want to talk to you about those t.i.g.e.r. grants. so it's to stimulate job creation because the economy is hurting and because particularly some states are doing worse than others. the state of florida and i know you already heard it from mr. mica. the state of florida if i'm not mistaken, made multiple requests, bhutto's 150 projects in florida. that included local government and ask d.o.t. the requested only for projects. in florida, which is in the top ten of unemployment numbers, received zero money from t.i.g.e.r. is that correct? >> that's correct. >> so you could not find one project in florida, someone not qualified for t.i.g.e.r. grants. >> no, sir. there were worthy project that did not get funded. and as i mentioned only about 3% of the projects were able to. i would point out that economically distressed areas is something we've paid close attention to. you previously thought if i'd are mr. mica about state unemployment answers. especially the large states, the unemployment varies in different parts of the state. we're tried to the event on the particular pocket of higher distress through the economically distressed areas. as i previously testified, 60% of the projects went to economically distressed areas. >> i understand that. is there any debate that florida is in the top ten of unemployment? >> no, we're not debating that. it's a lack of enough t.i.g.e.r. funding to satisfy. >> it again, i understand that there's not -- you have a number of states and i'm sure they're worthwhile projects. i'm not saying they're not worthwhile projects. we have a number of states that have much lower unemployment, including lower than the national average which is obviously very high, that received millions of dollars. in florida, the top of the nation as far as unemployment received $0 eared anime, tell me how that's justified. >> well, a couple of things. first, as you previously heard, florida received a very significant high-speed rail grant as part of it. so in addition to the rest of the recovery funding, florida received one of the single largest -- >> for me stop you there. the other states that received high-speed rail today also not get any money? >> the unemployment and economically distressed areas is one of the criteria, not the only one. it's a combination of a couple of things. >> i'm sorry, mr. secretary. i guess or try to justify florida getting zero because they received high-speed rail money. if that's the case, let's not lose that thought. our other states that received high-speed rail money, do they get zero t.i.g.e.r. grants money. >> i don't know off hand. >> mr. secretary, we're adults here. if you're going to use that as a justification, then let's be consistent, please. all right, if you're telling me one of the reasons i'm florida -- and by the way, that may be the case. if you're saying one of the reasons they didn't get t.i.g.e.r. grants is because they got high-speed rail and that was the policy. >> no, sir, that was not the policy. >> so you're taken that back? >> know, if i could just clarify what i did not mean to imply that they got t.i.g.e.r. grants did not get high-speed rail grant. it did get a very significant high-speed rail grant that was awarded on the merits. with both a high-speed rail program and the t.i.g.e.r. program, we were in the unfortunate position of having far more meritorious projects and we could possibly award. economically distressed areas was one of the considerations and it's an important one because both recovery and reinvestment are the aims of the bill. i would encourage, first of all, and i have had a discussion with your state eot secretary about this. i would encourage the state, the applicants for this specific t.i.g.e.r. projects to come in and let's go through debriefing on the strengths and weaknesses of those individual proposals so they can maximize their opportunity for the next round. >> i appreciate that, mr. secretary. i think that's a worthwhile exercise and hungry for that. i just want to make it very clear for the record that holds you cut it, however you look at it, whatever justification, whatever criteria, there is no explanation why florida was not able to qualified for one single dollar of t.i.g.e.r. grants. i'm sorry, sir. i appreciate you're willing to look at the proposals and whatever it may be, but there is no justification, absolutely zero justification for florida to not have gotten any from t.i.g.e.r. money. >> mr. chairman eared >> ms. brown. >> i just want to say that i'm disappointed we did not get t.i.g.e.r. grants. but if you turn to florida and you look at every single category, florida has received significant amount of taxpayer dollars. part of the problem in florida initially received money, it was sitting in tallahassee. and we had to move it. i mean, we were fifth in one. if you have not prodded to are attention, and it's only 50 states and the state used in the transportation dollars. fifty-one out of 50 states. so if we didn't move it and once we got on top of it because@@ in your testimony, he said as the president made clear in the state of the union address, his number one priority in 2010 is accelerating job creation and the pace of job creation. transportation is an important part of his plan to put americans back to work. and you urge congress to consider supporting a jobs bill. that's great. and as you heard the chairman and other members of this committee, we are very concerned of the fact that the same administration requested an 18 month delay in the transportation reauthorization. and when you look at the impact that the stimulus money would have thought, would have been a greater impact. however, having talked to contractors, they actually put on hold purchasing equipment, decided to pay overtime versus hiring new people because they are concerned whether it's 18 months, maybe 24, might be 36 months. i'm concerned that some of the individuals throughout the administration. i know chairman oberstar mentioned larry summers, which is not the been for a supportive funding. how committed is the industry chin in creating jobs, although it's a year late, how committed are they in creating jobs? and if they are so committed, wife are they really aggressively moving to get congress, which we are prepared in the house to pass the transportation reauthorization bill? at the job creation bill. >> sir, one very important part from the transportation project, probably the most important part of the senate jobs bill is the service transportation authorization until the end of this calendar year. that starts to provide the kind of certainty and predictability that you illustrate. i'd also mention because it needs clarification, i believe, this difference in the recovery act funding between outlays and obligation. and the important part on obligation, because we work on a reimbursable basis. the obligation is when the jobs tarts. it's when the work starts. we are reimbursing when the work is done. this is like writing a new automobile. you don't pay the manufacturer to build it. they build it, they deliver, you test drive it, then you pay for it. so the jobs, the investment are up front. the federal reimbursements at the back of the progress. >> next, we talk about predictability. and i understand what the senate did on their bill and they're going to have part of the funding forward to part of the t.i.g.e.r. we heard some concern come up with the administration out t.i.g.e.r. grants and some other accusation as it relates to that. do you think it for predict ability is better to run to the spending formula for predictability? >> i think the t.i.g.e.r. grant process has in particular, has shown that there's a value for both, where merit-based projects, that don't fit within one of our existing formulas and typically can be funded any other way. and one illustration in the t.i.g.e.r. award that you saw last week would be our freight rail capacity projects thomas or it's incredibly important an economic development standpoint, but it can't get funded any other way. it's a program like t.i.g.e.r. is the only way they were going to be able to make those investments. so the combination of formula funds, which the state and our other recipients now and are good at getting projects out the door in the merit-based projects like t.i.g.e.r. for one of the ones that don't but in that category is actually good combination. >> thank you. mr. porcari, you mentioned sound that are in locomotive somewhat heavy. one is in a newspaper article were 80% of money has gone to foreign manufacturing for the wind turbines is all you're funding here locally, that's my first question. and for those who are part of the administration, also reading an article just last week with u.s. trade representative, ron kirk, is encouraging mexico to sign into the government procurement agreement so that mexico can actually have access to some of the stimulus funding, which was to create jobs here in the u.s. the one question to mr. carpenter and those involved in the administration. the administration coordinating what's happening or you going to encourage other countries to access the stimulus money? >> thank you, congressman. first of all, the 80 vehicles that i mentioned in the locomotive are all of the rebuild mode. so we are reconstructing those. but certainly amtrak is certainly going to comply with a buy american component and it's been a great deal of conversation were committed to doing. we're hopeful to be the genesis for starting a domestic manufacturing base. we restart that for a rail. if i might, i want to make sure that one thing is clear and i really has to do with the transparency and congress that if you can bear with me, it would probably speak to the question that you have. i want to make sure that they make it very clear that the $1.3 billion in their people on our website you'll be able to see where we're spending every one of those dollars. there was a reference earlier about some other projects that while amtrak will be on our service and in our vines, the money is not coming to amtrak and certainly -- it's not reflective on our website. but the money that comes directly to amtrak, we're very proud of our transparency and i want to make sure that we made that point that our transparency on her website we think his first rates. i hope that answered your question, mr. congressman. >> mr. chairman, i noticed the administration were solid on that issue of job creation. if they want to submit it to the record, mr. chairman the president has an talking about the job creation here at home. we further panel hears talk about work of the stimulus package has done but i'm the same token you have part of the administration encouraging mexico to sign on to the government agreement under the wto so they can get around the buy american provision. see god one him saying one thing and another hand is encouraging countries to access the remaining of the stimulus package. and that's a bit concerned if they can't answer today, if they could provide the committee with their answer why they're encouraging other countries to access the stimulus funding. >> we certainly expect answers to those questions. the fundamental question of the buy american act goes back to the 1930's. in fact, it was enacted in 1930. and he was ready loosely by roosevelt in the wpa. and we simply reverted to this in the stimulus. is there u.s. tax dollars, the purpose of the program for stupid americans to work and use american materials in this product. the chinese are not hiring americans. they're not buying materials and their $585 billion stimulus plan. nor have the japanese, nor have the france has a 47 billion-dollar seamless program for the not looking to buy american equipment or materials to put into their stimulus programs. and in other areas, other arena, fine. that's a different matter. they use american tax dollars to put americans to. >> is to chairman, my answer to by saying that in some cases by american under the recovery act we can buy foreign goods if we don't have american good. >> and mob that are specified in a particularly and there is a process by which you have to perceive to resolve those matters. >> correct. and i think rsa gsa, one of the things we think it's an opportunity to give him in the recovery act is to buy some green building products in the kind of bulk in which we can help make the market for american manufacturers to start making them. there have been cases where we haven't found an american manufacturer. we have been approached by some who said if we buy enough of their products they will set up a plan and were hoping to have a couple of the successes to report to you. >> i agree with the whole idea and i understand the chairman said there are provisions if we can't buy it here. but for the administration to be finding countries that do not qualify under gpa to become qualified so they can go after the stimulus money is wrong. no two ways about it. it's wrong, dead wrong. >> mr. chairman, if i may, i just want to make clear for the transportation part of the stimulus program, by america has applied for the beginning, we've granted no waivers. we have one transit project that is actually started discussing that. we made it clear the project would not go forward if that was the case. >> you're hearing it straight from the members of the committee. gentleman, time has expired. mr. cohen. >> thank you, mr. chairman. and more particularly to the state of new orleans and its recovery process. i made a strong advocate of high-speed rail and that would be the first question that i would ask secretary porcari, will there be a second round application for high-speed rail. an first of all, before you answer that, i'd like to thank the secretary for at least the decision to provide new orleans with $45 million in t.i.g.e.r. funding. i like to thank him for coming down to the whirling stew take a look at the city's streetcar system and recognizing that it is a vital part of the city into the economic recovery of the city. so if you can answer my question about the second round application for high-speed rail. >> yes, sir. and first, i'm the t.i.g.e.r.'s streetcar grant for new orleans. that's a great example of a economic stimulus and livability and how those fit together as long-term investment that will help the country. yes, there will be a second round of high-speed rail grants. we will be working directly with the applicants on that. we look forward to that, knowing that the high-speed drill program in the recovery act was the first step, an important first step for what will be a nationwide comprehensive high-speed rail network. >> can you provide me with the time when the second round application will be requested? >> yes, in rough terms, we anticipate making the awards prior to the end of this calendar year for those. the criteria and some of the specifics on that will be happy to get to you. they are being developed right now. >> and it will be from the stimulus money so they won't be any matching requirements from the states. >> the selection of the 8020. they will require a 20% match. >> these are post-stimulus dollars. >> thank you. mr. hooks, i notice you've been very quiet and i do want to leave you out of the conversation. and my question to you is, how many jobs have been created through the epa stimulus funding and how many of those jobs go to, for example, the inspectors to go out to site and to inspect sites? >> i can't necessarily break down the precise nature of what those jobs are. right now we estimate about 6800 jobs that have been produced were created or retained at this point in time based on what they are supporting. >> mr. hooks, i would like to put some of those people to work. there is a church in norcross georgia, it serves about 1100 families. there is a waste transfer plan that ought to be built right next to the church. if i were a student looking out the window, i would be looking straight at the waste transfer station. so i have no idea where the federal station is, but it seems to me that there isn't an environmental issue if there is a waste transfer station right next to a fully functional operating church. so if you can have your people look into that for me i would really appreciate it. >> would be happy to let you do that. >> if you can have your staff contact my stuff. >> i appreciate it, we will. >> and ms. darcy, this question has nothing to do with the stimulus jobs, but there is an issue that has been raised in the second district. and also, in the adjacent congressional district. recently, a federal judge issued a judgment after trial, holding the engineers responsible for the flooding in st. bernard parish as well as in the lower ninth ward. and the question that many of my constituents have@@@@bg) mr. porcari, thanks for being here today. i had an opportunity for you to come to my district which i greatly appreciate. i like to build on ms. jordan's request that this committee would receive a report or a map or something that gives us an overlay based upon what projects have actually been funded and how that relief to the unemployment in the economic under stress areas. i remember ms. edwards and i., when we first talked about supporting the stimulus package, many of us talked about having the commitment that the dollars are going to go into the unemployment area about also the second question that i wanted to ask, that wasn't in your testimony. and we talked about last time that we would this time and i don't see it. and that is, what do contractors have been able to now play in this arena, that we're not currently working at the time when this all started. and i know there's been a big play on words or whether his job sustained versus jobs created. but if all we did out of this whole process of over $800 billion is only to ensure that the people who are already working got to work a few more hours, that certainly was not my objective. so if you could, and this is my second time requesting this, that the report that would come to this committee at the next meeting would include the information of what do contractors, minority contractors in particular, have been able to gain employment, game contracts in light of all this money that came out. and also a record of how this overlay economically with the economically distressed areas. >> we will do that. we will need to get the contractor information from the recipients. but we will work with them to do that. >> okay. i next point is i was a little surprise in your testimony gave a recap of what has happened with the money, but it should really talk about lessons learned. and because i unfortunately have only three minutes i need to talk about is really important. i would ask you afford to the committee in light of what we did with the stimulus, if we were to do something again, what would be some of the key things that you have now cured out across the country that would enable us to spend the money in the best way. and let me give you a couple examples. i averted my community that because of the way the language was written, there's been a greater focus on short-term projects versus long-term projects. because i had to be shovel ready, we've done a lot of tv, but there were some other key projects that have to be done but couldn't get done because it was going to take longer. also, there was an issue about funding being allowed or designed and some of these other things. so i would just be very curious to hear what you have learned a deep going out and about and if you could supply to this committee. i really, i like to actually chime in for my colleague from florida. i was a little disappointed with the t.i.g.e.r. allocations and not only am i going to request a particular area to get a debriefing, i'd like to get a debriefing. because to be very frank with you, sir, i find it hard to understand how you can find poor communities, fund this movement throughout united states and yet fail to fund the largest one in the united states. it doesn't make sense. and so, i'd like to have a real serious conversation to understand what was the criteria, how things were determined to be selected and what we need to do moving forward. i believe is a member of congress, where part of the u.s. house of representatives. so when you came and you do the tour, i made sure that you went because i believe you have a number of this committee, just as much obligation to support ms. napolitano as i do mr. baucus and so on and i applied what it's been done. i have no problems with the ones that were picked, particularly in california. i think they're right on. but i think there were some others that should have been done in addition to that. and i think it's glaringly a problem. if further alarms me when i hear your comments about high-speed rail because when you come from a state like california, ok, california cat, we got 2.3 billion, but the route from anaheim to los angeles. so even though that's right next-door to me, that is still not -- if you're looking out well okay, l.a. got x amount and so we now need to do some over here. it's not necessarily reflective. and we need to make sure whoever is making these decisions understands the mass. because it doesn't make sense. and without i've got to second. so i look forward to speaking to you. >> thank you. we'll be happy to do the deeper you can talk about the project criteria. i will say again both high-speed rail in the t.i.g.e.r. grant progress, merit-based progress, overwhelming demand and we look for to the next round for them. if i could just spend one moment if i may, ma'am, on the lessons learned. one clearly is reporting requirements, streamlining, making it because the states in particular have multiple reports. they had to put together. it turned into a bit of an administrative burden. the other comment that you make, which i think is a very important one, about the short-term we service anti-projects versus longer-term. i think if the recovery act as a three stage rocket and what you saw in the beginning and the first 120 days, where the ec, already permitted projects for you could get out the door, which tended to be resurfacing. .. that's one of the areas of wanted to bring up because about november of last year i handed you a letter in regard to the ability to people to race officials refuted the conservation pool and haven't heard anything. there's been some kind of a delay headquarters, york headquarters, being able to allow the county to move forward with that. it would allow for probably 1100 acre-feet to be retained in the group for replenishment for the basin. i have a copy of it and will give it to you. but i certainly would want to make sure that that moves forward so that that can be done. it would save a lot of water and given california's drought situation. some think you very much for that. and i won't belabor it. i know you work great with us in this area. to mr. peck on the gsa, the areas in my district that have been working with gsa includes the norwalk tank farm which is an area that is contaminated. it would be nice to have the government release that contamination site and continue to clean it up but be able to have some of that money be able to be in the pocket of the gsa and the government for use in other areas, and i don't want to follow-up on that right now, but i would like to maybe speak to you on that. and mr. porcari, tikrit supervision as part of the t.i.g.e.r. grants as you know are going straight to my district as even mr. chairman team did a national significance, a court order of national significance, there are 54 going through my district which bring in all of the 40, 50% of the nation's goods to the rest of the country. those are project ready to go. they've already done most of the work, yet we have very limited funds to be able to get that now. the railroads need to be forstchen hopefully we will be the to put into effect laws that require them to put more funding into the participation of the separation is because they've benefited getting the goods on time delivered to the rest of the nation. those are some of the things that i have in mind. the high-speed rail, i love it and by sorry ms. brown, a great job. california is getting a lot of the funding for that, and like ms. richardson was stating it is going through, and yet there is very few -- i had to force the issue with the high-speed rail authority to sit with the locals especially in my area because a lot of it goes through my area to deal to determine whether are they talking eminent domain? have they purchased right of ways, which they have not. they talk to the locals about the ability to go through the communities. the cities are saying no you're not. so while they may have plans, they are going to run into legal objections from the communities they planned to go through. and i certainly have some concerns and some issues i want to sit and discuss with somebody and bring the people who are actually going to be affected to the table so that there is at least an understanding on what -- if they want to go through, fine. i need mass transit. i don't need high-speed rail in my area. i need to move the mouse is. there's 12 million people in the l.a. county alone that need to go to work and we'll have bus transit and as you know, you have one accident and you have a tie up. so those are mostly comments i wanted to give it to be sure we look at. i just recently heard the cost of going from san francisco to l.a. was deemed to be 55. it's now gone to 105 and this is just how would i say speculation from -- because it's not built yet. i just want to ensure and also i need the dialogue on the right of the issues. we have someone come to the district can't talk to the communities involved. they have done it and will move with a high-speed rail authority but we have no idea where they are moving forward, because as ms. richardson was just stating it goes from -- it doesn't go through our districts in many areas. comments very quickly. do any of you requested from your contractors information about how many jobs have been created within? because we -- i hear it in my district people say we've gotten jobs developed out of the stimulus money but yet i have no idea where those jobs are coming from. and if he would request your contractors to report to you how many parts of the developed the would be helpful because we keep hearing there's no job development. we have 10,000 severin is coming home starting in march. 10,000 a month through the united states. are you making provisions for them to be hired first because right now the highest population is women veterans. i take exception to that. they've served this country and need to be put to work so they can be able to get into society. another one would be the projections of the projects because everybody wants to be able to bid on projects. have you determined if there is any excess money left over from projects donner to be able to put into new projects because they are going to use it. i'm hearing this from some of my water projects on the subcommittee and those are things i think this subcommittee would like to know if you are what can we do to alert some of the that have high and in planning or that have a greater need to be able to move projects forward that already online that can move forward i wouldn't say 30 days of already but at least 60, and a six month period and with that i've gone over my time. thank you for your indulgence and i would like to hear some answers if anybody is willing to comment. >> i would love to. starting with where you ended money left over from the low bids on projects have experienced that in the recovery project across-the-board and the states, transit authorities and aviation eligible projects have been able to recycle the money and put out additional projects. one of sable real originally thought we would do about 300 airport improvement projects, we of donner 360 because the good bids. the money is going right back out for additional projects. i believe my colleagues would do the same and that's true across-the-board. i would be very happy to convene a meeting with high-speed rail authority on the issues you brought up. i would point out i've been pushing applicants on high-speed rail very hard in this case the california high speed@@@@ú@ @ @r f the nation's import coming through that one very small pipeline it is a critically needed improvement. the crossing as you mentioned are also critically needed and it illustrates more than anything else how far behind we are in our infrastructure. >> congresswoman, if i might, we do track the jobs. we do it on her work hours and we do that consistently and then that is reflected on our website and i would like to make the comment also that amtrak has been longing for so long to have capital funds that if we have the ability to move it, if the bids come in under its danilo we're putting it to good use or the to can be assured of that and we will be happy to talk further on that. thank you. >> if i might address your concern about the turning warriors. we're using $3 million of the narrow money to train returning veterans in what is called the veterans project. we are treating them to have skills to do digitization and other skills to help in our archaeological cataloging so we have one of those ongoing projects now in augusta georgia, won in st. louis and no one in d.c. and we are hoping this kind of project can get more and we are looking to the next year's budget to get more money from that. >> finally by might on the contract job reporting, we are by the white house recovery act office required to have our contractors tell how many jobs they are creating. as i said before the rules under which they do that are stringent and very conservative, and really the have to have actually been paid for a job before they can report so when they hire people in anticipation of payment they are of reporting those jobs yet and that may be why your hearings, i think i have a job because of the stimulus program or the recovery act and we are not reporting it. >> mr. chair i would like to have this committee report on some of those figures that the administration has but we may not have them at our disposal. >> we have included in the 40 day report all of the information that comes to us directly comes to this committee directly from the state dot and other participating federal agencies and if there's any additional information they have through the course of this hearing be distributed to all members. >> thank you, mr. chairman. i know was. it didn't get a chance to introduce. you are the former mayor of mccaul which is in my district and i want to see for the record they couldn't have picked a better person to do this and i worked with you and the predecessor on amtrak and importance of fully funding it in your right it is nice to be able to see we are starting to actively invest in the passenger rail and strong proponent of that. i may want to ask the panel for help i don't know if you can do this for me mr. chairman, but we -- i appreciate the high-speed rail that was announced for illinois and the governor as you know of the state $45 million into the quad cities to the chicago passenger rail and that came through i think they are incredibly great to put people back to work. we are short about $45 million on the deep end where they want to put the depot and i don't know if there is who i should talk to so i guess i'm asking you for assistance or maybe you could have to eckert you need to talk to talk to because this is, by the recall going to put 800 people to work and it's ready to go. will be huge. we are going to build a new campus. people are going to come from chicago. they go to western illinois now so any help that i can work with the staff on i would generally love that but let me just say i think you've done a wonderful job putting people back to work is great. so i guess it's more of a replete to get help but i just want to ask you mr. porcari views it as $30 billion using in the senate bill. the chairman came to my district and we had young people i think you're a member with t-shirts on on the highway and its u.s. 34 and we have in the district's turtle highways. but here young people came to meet with the chairmen and had these shirts. this is a highway that has a curve that goes from high school and eventually come its way to happen, there's no question is, it will the win. if we don't get it fixed what we are going to have as i think you know mr. chairman what we are talking about here you will have the school getting it rammed into while these kids are in school. what is the 38 billion in the process of planning for the funds and can illinois two? five to the dangers and my fear is if we don't get moving quickly we are going to read about something in the paper, and again, you know, i want to be very proactive on this and i don't exactly know how to do it so any help i can get again would be great. >> congressman, first i need to apologize. the version of the jobs bill that was passed yesterday as a surface transportation extension until the end of the calendar year. it does not have any longer additional funding. but it does bring is consistency and capability. so the existing formula funding for every state through the surface transportation bill would be extended through the end of this year. i need to also caveat that by reminding the committee that the highway trust fund will need a cash infusion sometime this late spring to continue to be viable. so if you are speaking to the larger need that is out there that we are currently struggling to fund. >> i worked hard to get on this committee and the reason i did is because as i said earlier, i believe investing in infrastructure is particularly in a recession but we have got, you know, 20 years ago the president of iron workers said x number of percentage of bridges were in dire need and so far i think only a handful of those and 20 years have only been touched and this chairman has worked tirelessly to get a multi year highway bill reauthorization bill and i am not going to -- i know he won't put anything we can do and i would hope you would let the president know this is a huge for the american people because we cannot peace the of this. you simply cannot piecemeal and when you take a look at the money spent by the government on some things people find a little bit testy, $750 billion for banks, and yet we are having a very tough time finding the illinois lottery trust fund in getting the multi year highway bill, the kind of money that chairman carper would love to have so we can expand amtrak, those are all the things i think if we are going to get the economy moving again that is how we are going to do it. a little bit here and a little bit there i think really doesn't get to where we need to go. and congressman, i don't know if he's still here but here again if we are going to take these rail car sallai have an mt factory, former maytag plant that was sourced out to mexico nafta. we would love to make them there so if anybody is interested in a wonderful facility -- aren't you glad and even here today. but these cars and these kind of things need to be made here and we are going to insist. i will be lifted if i find out we take the taxpayers' money and we send it to other countries to manufacture stuff when we are sitting here in illinois and 11.1 and the gentleman from florida talked about the unemployment rate there. so anything we can do to do that. to give one final example of this, mr. chairman, on the chicago thing to repay 800 jobs are going to be created. i just got to conclude by saying everybody's gone over their time limit i must be living in a different time warp because i hear people talking about how the stimulus isn't anybody to worker safety job or done anything. for those people, either on the wrong planet or i don't know where they are getting their figures because quite frankly, we are seeing a number of things, a number of good things come and if the chairman has his way and i hope he will with the surface transportation bill, we can get this country back moving together, and we can actually start repairing bridges. my fear is i don't want to see a repeat of what happened in minneapolis. but sometimes people say to me that's the congress reacts, it has to be horrible before anything gets done. so whatever you can encourage the administration to do, and i would be happy to -- i'm sorry i went over and on a grand jury little bit -- but whenever you can do to get the message and move this, i will work with anybody here. >> congressmen, those are great point. if i can just address one because i know we are out of time. on a high-speed rail, the american manufacturing company is critical. secretary lahood called together the existing and potential manufacturers basically to tell them that the buy america act is the floor, not the ceiling. that we expect more of them in this, and we have coming out of that we have commitments from 30 manufacturers all different parts of the supply chain the. they're going to locate or expand an air ticket to get business as a part of high-speed rail. it's the kind of a bully pulpit raising the expectations i think we can do up front and that we are very focused on. >> mr. chairman i know we are late but i would like to respond. thank you for the kind words. the project that you're speaking of, congressman, is an example of what we are seeing around the country in certain areas and by sorry that [inaudible] is not here but the development it's come in and around the stations whether it be in l.a. or mean or california or florida or wherever, the transit oriented development is a given and it's starting to happen with rail. the of result that is happening is waiting for the two major projects to happen one is a university expansion and the other is expansion of passenger rail and those jobs may not get equated as we are reporting that it is happening out around the country and we fully support that and are working very hard with the folks in the quad cities and on into iowa i might add and we will follow-up with your staff on the depot situation in any projects that might be available. >> thank you. >> miss edwards. >> thank you, mr. chairman and all of you for your patience. i have a couple areas of inquiry because i agree with mr. herron with so many on this committee. infrastructure we have long-term major infrastructure needs, water and sewer, transportation. there's not a dime that would be spent on infrastructure that wouldn't pay off jobs right now in true economic growth for the future so it seems like a no-brainer. i don't even know why we are wrestling with what we need to do here but we are we. but i do have some concerns looking at the buy america provisions and particularly mr. hooks, i wonder if you can respond. i know that the epa issued 25 regional leaders. there was a nationwide waiver that was announced for june and an updated in august and i wonder if you can tell me what that means in terms of dollars gone and jobs for the waivers issued because i'd concerned we have gaps in by america that we do need to close and i wonder if any of you have comments particularly mr. peck about how we could strengthen by america with respect to services. i look at things like high-speed rail for example, you know, where some of the design services and stuff could easily be taken off shore because this kind of where a lot of the work as, and so i don't want to make these major investments and then both on the surface and the goods see american taxpayers' dollars that are not used to buy america and built america. so i want comments on that. >> let me respond to the buy america question that you asked. we have issued 43 project specific waivers at this point in time and four national leaders, a waiver for the components of the various pieces of equipment that's necessary to be purchased. in my opinion i think that is a fairly small number, 43 projects approximately 4200 -- >> what does that mean in terms of dollar amounts and jobs? >> dollars of notes and jobs i don't have an algorithm that would give me that specific figure. we would have to do more research and supply that for you at a later point in time. i can assure you the conversations we've been having with the recipients and states our primary of ejected has been to purchase our products here in america. but in some instances due to the historical purchases of equipment for the entities that want to replace equipment that have previously purchased foreign manufactured goods and those instances we v @@ ding site of gsa, the major services that we try to acquire, building maintenance service cleaning services and even architectural engineering services, they are an abundance of american suppliers and contractors to do it, and so i have to say in our recovery act work on a am not aware of any instance in which we've had to go somewhere else. there are -- there are opportunities but for one reason or another great architects and other countries but we have great architects here and that is who we have been hiring to do the work. as i said before, my concern is something that i think the recovery act will allow us to overcome is there are some aspects of sustainable design and development in which right now we have to accuse foreign components and their, too, as i said we are having active conversations with american suppliers and talking about how can we ordered enough from them to get them to onshore their production. >> part of the challenge is we wanted them to know that it is a long-term investment. there is no incentive for them to bring work back on shore if they don't know that we have a long-term commitment. before my time runs out, it's probably already run out but mr. chairman, if he would indulge me for just a moment -- >> your timing is not run out. >> thank you. i want to get to a class and about the disadvantaged business participation because i've had this inquiry, and i know others on the committee have as well, and i know that we have a 10% aspirational goal, but i don't see is a state-by-state, what are states really doing? how do you keep track of that, deputy secretary porcari income and what is it -- and it concerns me that we also -- and with mr. cummings said the chairman's help come allocated additional bonding authority but only five applications, $50,000 out of 20 million, what are we doing to make sure people even know that authority is available to disadvantaged businesses can take advantage of the bonding authority and then again how are we meeting the 10% aspirational gold because those are huge companies that have come out of my district and within the state. >> i think those are excellent questions, and we have heard some of the same questions. one of the advantages of using the existing mechanisms and relationships and policies with the states in their recovery act is that the states and grant recipients know what they have to do including with disadvantaged business enterprises. and they should have in place established programs to promote and get into the goal and beyond. it's clear that we have a lot of work to do on this. it is clear that some states have done a better job than others. i will tell you it is particularly frustrating that the bonding assistance program, which we are very appreciative of because it tackled one of the very specific barriers to entry that minority and disadvantaged businesses have which is securing bonding is a you can bid on a job that we are very frustrated it hasn't been used more than it has. we've been working with the small business administration. we have a partnership with one of the largest owned banks to promote this. brandt kneal, who was the director of the small and disadvantaged businesses, has literally been around the country promoting this and pushing our partners to do better. >> i have to tell you i was with a group of business is just a few weeks ago. they had no idea that it even existed so i don't know what it is that the department is doing additionally to reach out and encourage states to do the same. i don't know if it is possible but we do need a specific report on minority business disadvantaged business participation and where states are in terms of meeting those goals by category i want to know how many women owned businesses and african-american owned businesses and latino businesses are really contributing to getting to the ten per cent which should be a floor and not a ceiling. >> if i may suggest a place to start is we could sit down with you and make sure we are getting the information to get there that you would like on this. this is again something we haven't been successful at is we would like to have been. we are looking for ways to improve the process and would appreciate suggestions and input. we talked to a number of minority contracting associations and professional groups and others as part of this but it's clear that we need to do more. >> i look forward to working with you. thank you, mr. chairman. >> on that point i want to underscore that early in this process last year i convened a meeting of the building trades, the presidents of all the building trade unions and the will try caucus and the members of the asia pacific bachus, the black caucus participated. we had a very frank exchange with the presence of the trades about outreach, about inclusiveness, bringing a minority trainee into the program. the building trades, going back to the allegis where the guilds were the skill was handed down from father to son from generation to generation. we need to break that chain and a change things and i designated ms. napolitano to coordinate for the caucus for the follow-up to those meetings to the presence of the building trades all committed to initiate new programs to recruit from the minority communities to bring people into their journeymen and apprenticeship programs in the the same needs to be done with the minority contracting community and you're point is well taken about the need to outreach to the code outreach and notify about the existence of the bonding provisions in minneapolis just last week mr. allyson represents minneapolis, and i met with minority contractors in minneapolis. a good many were aware of the bonding but they also didn't have a way of accessing the funding. they didn't know how to go about eight. there were also concerns that the outreach is very successful for the women owned contacting firm but not black or hispanic owned contracting firms and so i have discussed with ms. napolitano about a follow-up meeting that we would have with the department with the associated general contractors with the building trades and we will set up a time to convene and have a roundtable discussion about these issues and have a full agenda which we will develop. ms. brown? i yield to the gentleman. >> thank you. i want to address a major discussion in the black caucus have and i invited you to come and speak with the caucus on this issue because there's a lot of concern that let's say all of what we are discussing, all of this stimulus i look at it like my grandmother is sweet potato pie we all contribute when we voted for the stimulus in fact was all democratic votes not one republican but it's important minorities and women get a slice of light sweet potato pie. it is a good reason for not want to know and so it is broader than just two or three people. we want to know how those programs are working and whether or not because part of the problem you have these big contracts if you don't take them down the minorities and females cannot participate because they cannot just bond, but you know, it's just the big guys get of the dollar's and that is a part of the problem and that has been a part of the problem and basically is throughout the federal government not just with transportation even so we've had some success minimum but all through government part of the problem is that minorities and females don't get opportunity to participate because of the size of some of the projects, general service in particular. that is one of the really good systems in other words people than doing business with general surface for years and so it's hard to break in and so the question is what can we do to let people know and part of it is the workshops you have, some of the aldrich going into the community and letting them know that these opportunities are available and how to apply. i've had several of those and i would encourage other members to do the same thing. >> we are going to follow-up and have lessons learned in this arena as well. >> practice i guess we should call with -- sprick -- established a practice is as we go into the authorization for the six year surface transportation bill. mr. porcari, they're has been much misrepresentation or misinformation about the pace of implementation of the stimulus program and a good deal of it on talk radio and television reporting and newspaper print reporting comes under the rubric i would say of misunderstanding of terms and in fact this misinformation to the general public. so let's have a discussion now about the terms. allocate, obligate, outplay. these are budgetary terms. i said at the outset of this hearing that the jobs precede the reporting. the jobs are on the site. contractors have ordered their material with which to do the project. they've brought their workers back or paul waide deily kaput then on the job site. they perform work than the contractor builds the state on the highway project or aviation product builds the airport authority and the state pays and then vouchers the federal government so the jobs are out there long before they stoutly takes place but i want you to explain for the public understanding allocate complicate, elderly. >> thank you, mr. chairman because this is probably the single biggest misconception in the whole recovery act and what we should all carry out is exactly what he said which is when the materials are ordered, when the jobs are created and when the layoffs are related and the obligation in the elderly in particular have been a source of confusion. we have obligation for transportation projects is when those things happen. the arm materials are ordered to and the work happens. because we work on a reimbursable basis of the three terms the one we should care about the least is actually out late because that is the end of the process. again i seen this from both sides starting the recovery act delivering projects and the state dot and i can tell you what obligation actually means. it means you can talk to the state contractors' associations and tell them these are the bid packages that will be on the street in fact we put them on the street conditionally on the act being passed so the moment the bill was signed you can actually award projects. that is when people are hired. the reimburse process, what it does is protect federal taxpayers. i use the analogy before if you are buying a car you don't pay the manufacturer to build it. they build the car and employed people to build the car. you buy the finished product after you test driven. that is how the project's work after it is completed for our smaller and midsized projects we reimburse the states the same day or within 24 hours. for larger projects that are more expensive and of higher expenses, we do that on a milestone basis something about having a house built. you don't and, if you are smart at least and a builder the cost up front. to make progress payments based on the work that is actually done and that's our transportation projects work. so the color of the money as it were, who's putting the money up front shouldn't matter because the states, the transit authorities in some cases are actually fronting the money getting the work underway and we the people when it's built right, when we have a project can be proud of when we have that investment the federal government with the recovery dollars is reimbursing so the owsley which is the actual federal expenditure is the least important@@ these jobs were in spec terse? you need inspectors to certify that the work has been done. >> we absolutely do. the shortest duration of the project of transportation projects think about a resurfacing project even those are 15 years life. our bridge projects might be 60 or 70. you want to make sure you get the product you paid for that's why we have a reimbursable process so we are not using our federal taxpayer dollars until we have a product we are all proud of and you need inspectors obviously to make sure we get our money's worth. >> thank you, mr. chairman. >> that question about the inspectors was asked of me earlier. we actually do have inspectors we just were not using -- we were using stimulus dollars to hire inspectors. we are visiting each state twice a year plus some headquarters personnel are visiting each state to ensure that the money that has been appropriated for the stimulus that projects are being in fact spent on stimulus projects as they were intended. is the mix of the point is we have $32.2 billion obligation on the highway and transit, 94% of the $34 billion that was approved. that translates to 12,414 projects approved. we have 1,202,052 out to bid, that's $26.4 billion or 77% through the end of december. that number is higher now because we are into february. so the point is those who didn't agree with stimulus can use any number they want but they can't -- they are not entitled to their own numbers. these are real numbers. the obligation -- first the d.o.t. allocated to each state the told the state this is your formula allocation. now you are approved to proceed to obligate the funds that is to commit projects to these dollars and then the next stage is advertised for project specific bids correct? >> correct. >> then they come in and are evaluated and awarded it win the award is made in the work can start and i think we have an extraordinary track record. very successful track record on the surface transportation program and transit and in aviation. the faa moved out and airport authorities committed over 400 projects in a short period of time. they have a different contracting authority than highway departments. they can take bids and hold the contractor to that for up to the year many authorities have told me. it may be different with certain ones but most of them can do that is that correct? >> that is correct and i will tell you contractors were so desperate for work many of them held their bids even longer than they were required to and that is an illustration of the good value we've got and i previously mentioned we felt the federal aviation administration would be able to do 300 airport improvement projects. the bids came in so aggressively and low we did 360, and working within the statutory process the states had the teed themselves up and in some states word aggressive about for example putting projects out to bid even before the stimulus bill was signed subject to federal appropriation so that it was essentially a conditional a word so that those projects would start that much sooner. the reimbursement process served well in protecting our federal tax payer dollars. it hasn't been impediment to getting the work done and people hired which after all is the goal. >> i can say from personal experience the aviation side works so well airport authority justice outside my district of the territory -- donley colcord goes up to the shore, the lake is in my district but the talent isn't but they think they are and they invited me to groundbreaking carried by the time i got there it was ridden cutting. the budget was completed that is success, putting people to work. >> that's truly success and there's countless stories like that throughout america. there were projects under way within 24 hours under construction within 24 hours of the president signing the bill. i know that because we did the first one in the country. >> maryland, silver spring 24 hours after signing. i know i carry my report card with me. you can't read it out there but i have added my breast pocket everywhere i go, my monthly of dated report card on stimulus projects under the jurisdiction of this committee. now mr. porcari, among the criticisms are those who can't find anything else to do say these are just short term projects. it is in the d.o.t. that made the selections were federal highway that made the selections, it is the state dot and for years, this is my 36 year and before that i was the staff director of this committee and administrative assistant for my predecessor and also chairman of this committee. state after state said we have all this portfolio of repair projects and engineering terms. if we only had the money would duties. well now have the money and have been doing them. you can't have it both ways, you can't complain they are short term projects the deinze the roads need fixing. you've got to do both at the same time and we should have had a longer term projects. because the program has been such an undeniable success 980,000 jobs nationwide and i cited the numbers earlier of the unemployment compensation checks, taxes being paid by those that work and the payroll for those on the job so now the critics find something else to carp about. they should have been longer term projects. we will have time to do that in the six your authorization bill. >> it is true, but we have long-term projects also in the recovery act. i like industry three stage rocket, where the first projects out the door for things like resurfacing that can be done through quickly. those has a 15 year life. the next series of projects, and one illustration would be the call to the tunnel project in the san francisco bay area which is under way as the second wave for second stage 3 that is an improvement there will be there 60 years from now easily. >> and the inner dispersal luke in tulsa. i went to ms. fallin's district to tulsa, oklahoma city, secretary of transportation gary ridley for oklahoma said they 76 million-dollar project. it is a 66 or so while around the city of tulsa. it hasn't needed major repairs for years, they haven't had the money to do it. the project entails 44 bridge readings and huge work on resurfacing the existing road way and creating shoulder space for safety purposes. we went out on the job site and i asked how long did it take to design this? he said we planned 18 months design and engineering that after the hearing in october of 2008 and this committee room he said i went back to my staff and said that kennedy is serious we are going to have a stimulus program we'd better get ready and in four months the did the design and engineering for the 18 month design plan and he said i told my engineers you take your design work to church with you on sunday because if i need to talk to you i will and they did and he did so the of people on the job site. there were contractors telling me see that equipment? it was in mothballs two months ago and now they are working. i went up to the contractors. there during a continuous pour badgers kebir year on one of the bridge segments, 44 bridges, and they said we are so glad to be working, we are so delighted to have our job. it's working. so you will get back to us and we will call you for a meeting with the caucus to discuss mr. hooks's lessons learned. epa was off to a slow start and we were on to that the hearings ago because you had internal difficulties interpreting the buy america. are those issues now fully resolved? >> i believe so. >> what lessons for the future? what advice do you gift for other of your brother and sister agencies here and for us as we move forward? >> one of the things we learned from this process is closer working relationship with stakeholders quite honestly. when faced with new provisions whether they were by american or davis-bacon we sat down with contractors and stakeholders and conducted numerous webinar and visited the states and cities are new provisions to this particular group of people or entities building waste water management treating facilities. how are we going to work our way through this. it's a mass education program and i think in terms of lessons learned we develop a closer relationship as a result and i think we were able to work through many of the difficult issues of the troubled community. i think we were expecting a lot more by american weavers in all honesty to date we've had just a handful. work is proceeding. people are going to work and we are purchasing products by and large from american factories. >> i think the state agency has learned a great deal and has learned to be more nimble and respond more quickly. understandably the state revolving loan fund for the 12 years of the previous management of the congress wasn't authorized. >> one of the other things the states have learned as well is typically it took two years from the times of appropriation to the times they had to have the work under the contract. they did in one year so we all learned how to expedite the process. evin internals to the epa we've learned things on how to the chief administrative efficiencies we will incorporate not only to finish out administering the recovery fungus but we will put in as a permanent fixture in terms of the way we do business of the agency. >> i looked up the list for the state of minnesota, the state public facilities authority managed by jeff freeman and terrie coleman and have been doing it for 25 years, career professionals. they rent every project 13263 in the waste water treatment of reena and small communities, 1500 or 500 population and they've been waiting for years. the systems are failing, septic systems are failing or they had 100-year-old sioux worse grown fruit tree fruits and they are getting the funds for the project. they were able to leverage the loan money and a grant money to get their tickets 73 billion-dollar program and a 502 million-dollar program out of it. >> i think the additional 50% substation that we provided these opportunities have not had an opportunity to participate in this program are engaged as you said. >> you have done combined overflow and said 6% of the projects are cso. do you have one or two examples of those? >> unfortunately i don't. >> provide the was for the record. >> i will do that. estimate for the waste water collection systems i know in my home town in minnesota, the waste water treatment systems ilana goldman. i worked on and when i was in college. pushing a pretty mixed wheelbarrow up the ramp to pull it into the forms for the retaining facility. like my hip, osteoarthritis. i had a new one, the same thing with that system, it's got osteoarthritis and needs to be replaced. there's lots of those all over the country, and this recovery act, this stimulus program gives the opportunity to do that rehabil) here in ed winstrol maryland right next to hyattsville we're a community and received some waste water moneys, where they are instituting bio retention gardens and putting planting trees, capturing the water on the site. i think the community is also going to be instituting a rain barrels so there's a variety of practices being used historical used across the country now being expanded. i feel that we are originally thought we might have trouble trying to identify 20% for the project reserve. it turns out we were oversubscribed, probably closer to 29% across the country in terms of these types of projects, green infrastructure, water efficiency are also included in the 20% as well but we are highly pleased with the corrine infrastructure projects that have been developed. >> those are encouraging, and i'm glad that the epa has encouraged the states to move and pushed them to move in the direction. it's not entirely your decision to make but you can enter digit and have done and ms. jackson deserves credit, had been a streator jackson for her leadership in that arena. of course we need to reauthorize the program as i said earlier for 12 years of the previous majority of congress it wasn't done. for eight years the bush administration never submitted a proposal to congress to reauthorize the program and we've done more in one year of stimulus than has been done in several years of this program but we have passed and the 110th congress and again in the first session of this congress from this committee and the house the reauthorization state revolving loan fund and the need to act on it and i hope that you and ms. jackson will insist on that with the president and the omb with the senate leadership, get them going. let them move something over there. they haven't passed much. [inaudible] i don't want to get you in trouble with the other body. >> thank you. >> i will take them on. superfund. how many superfund sites to get grain to be dealt with? >> in the entire inventory? >> yes. >> i'm not sure. we will have to get that figure. >> something like 400 or 500 projects need to be addressed. i compliment the epa for putting $600 million or committing the $600 million to be allocated for the superfund and you have undertaken work on 35 projects. do you have examples of success stories? >> we are up to 30 projects as of this point. i think the project, one of the projects i used in my testimony was in minnesota as a matter of fact -- >> you did, i'm sorry. >> we removed our senate from approximately 500 homes just in the state of minnesota, reducing that threat. >> that's helpful. and in our next hearing which will probably be another four or five weeks we will have an update on the progress. mr. peck, you told us that the gsa is aborted twice the amount of contract in the last six months as the gsa does in an entire year. that is a great achievement. how did you go about doing these projects differently from those in the regular year by year gsa program? >> a couple of things. we set up a dedicated office in the national headquarters to supervise the projects. we created -- we have the 11 regions and there are service delivery mechanisms and in each of the regions we created a recovery act executive, and those people worked as a team starting to figure out how they could make things move faster. we put in some special tracking systems and have to say getting the funding to upgrade our information technology and tracking things helped and then i have to say there is one of the thing i am fond of saying. we discovered some of our review process these internally could be collapsed and there's a lot of -- because we have lots of rules we have to go by contracting rules, structural rules, mechanical standards that we follow that are designed, the reviewers review and in this case when we were looking at the new green technology what would reach dee dee to be reviewed by the national office as well and there was starting to be a lot of back-and-forth and about nov we decided some of these things were taking too long and we institute a system life term to speed dating. we told our regional officers they could come to washington, told our national people's that they had a couple of hours in which they were going to work through their differences on the reviews and come up with something we could put on the street. one other lesson learned since you asked -- to other lessons learned i would like to note. ms. brown talked about the design build and other ways which we can accelerate funding. one of the reasons we haven't done that sometimes in the custis constraints on funding will get the money to design a project, and in that project often sits on the shelf and only years later sometimes do we get the money to construct it. by the time you get to construction almost inevitably something has happened to make the design somewhat obsolete the meter requirements have changed or worse, or better in some ways. technology has improved, so you're not wait to build a building with five-year-old technology, and you go back and redo the design. that's one reason we haven't been able to use some of the compressed process he's protected of full funding for a lot of our products has made us move forward. .. and you were able to do while the designer ones. but in other cases reeducate all designs of the show and then one of the line. we discovered as we had to update the design to get them from 35% to 65%. one of the things i think we know in the economy as their least ups and downs. and to the extent that we could have a group of projects ready to go when the economy turns down so we can get the advantage of the softer construction markets, we'd all be better off. i can't say that we can put off if he reveals it got to go fix it no matter when it happens. but some of the projects were doing, for example, replacing windows in a building, that could happen this year or it could happen in some cases five years from now and we could get the advantage of better bids. so there's a lesson for the government as a whole about having some capital requirements held off for a point at which we can get better bids. we'll get a better price and will be able to stimulate the industry. >> those are good lessons learned, good practices. maybe we can incorporate some of that in future gsa legislation. did you have any big challenges, typically gsa has a plethora of challenges when bids are awarded. >> we have had some protest, as they're called, we had one i have to say that we were -- two that i could cite, in which we have protest we were able to sit down with contract your and get the protest with john. and i think that's also a reflection of the climate. there was a real reason for people to say, you know, i got to let this work go forward in my community. remember, contractors have a lot of subcontractors were anxious to get to work your general contractor that gives us a protest right now isn't going to be very popular with a lot of the subcontractors. >> i think us generally, too, there very few challenges in the federal highway program. none that i'm aware of. i can expect there are only a few. you reference the being federal center in indianapolis, where they plan to install 4500 alert panel. are those similar to the ones that were in held on the department of energy roof? >> i'm not familiar with those. but i can tell you -- >> it's a very new technology. the actors a new way -- >> eye of a strip of it in my office. >> the bob dole courthouse in kansas city, kansas, just get these photovoltaic membranes really, that's you lay flat on a group circuit neared the photovoltaic technology is really moving ahead and that's another way in which we think we can help make the market in the industry. you can now put them flat on a roof in the appropriate place and you can also start to put photovoltaic panels on façades that get a lot of sun on vertical façades. and they are in places where you don't actually need transparency in the class or you could put them on her therapist. we can actually get some energy generation that way. and that the beam center, we are going to -- we have a photovoltaic lathers that were going to usher the results against what were expecting. one of things were seen as we want to tell the american building industry which needs to go green outside the government, too. how well these things are working. what's the best climate in which was also to intensive system and which of the different technologies are giving us the biggest energy reduction, bang for the buck. >> i think this is a very important initiative to not only did our speaker insist on a green provision in each the committee contributions for the stimulus, but i started it here in this committee in 1977. we be hearing in which we took testimony -- i was at chair the subcommittee, but it was a subcommittee of buildings and grounds and tina brown cherry happened to be out of town that day. i was the only one left. the first chairman members don't get the chair, at least in those days. in the sheet metal workers union and gsa had combined to do a study, a two-volume study of converting several civilian office days to a photovoltaic. the cost of photovoltaic energy generated by photovoltaic in 1977 was a dollar 75 compared to 7 cents a to the investor owned utilities. but they estimated that with a multiyear investment of $175 million a year for three years on the generate enough production in the earth to reduce the cost down to something approaching 10 cents or 12 cents or lower and further over a period of years. government would be the consumer, private sector of the producer. i thought it was a terrific idea. so i took their proposal, drafted a bill, introduced it. senator humphrey did the same thing over the senate. we got it passed. jimmy carter signed it into law, but the $175 million for the first year in his subsequent budget and then lost the election. president reagan's abolish the whole alternative energy program. $960 million, proof, just without the window. dirtier leaders, i'm chairman now. we're going to do this thing. and we did it again. i dredged out my old know. my testimony before the committee was still in the committee files, including my own typewritten testimony in my unread might undermine. and we passed the bill and then we did it with the department of energy building. and now we put it into the stimulus. and i'll buy it has to happen all across america. we've got to do this year to >> mr. chairman, we also put the green earth on a building 37 years ago. really we were moving in a great direction and it stopped. we are relearning the lesson and we have -- we are going to be able to report to. we have photovoltaic in amazing numbers all over the country. foer also other technologies in which america is some behind. we have geothermal, chilled beams that saves energy. >> this is another arena where the united states to do basic t#cd$'@ photovoltaics. >> well, i want to see that survey completed in those materials submitted to the committee. and final question for you is, what is the status of the public building fund? >> well, there's a short-term and long-term answer appeared the short term answer is that in this year, we are, you know, the founders will collect about a $.3 billion in revenue. $5 billion we denote the turnaround and give to private sector landlords from home release base, about 52% of our inventory by square footage is now in leased space. the fund is still does produce a a net income. but as you know, that net income only that we used to do capital up rates on our buildings. in the short answer in the long term is that we are not producing enough net income in the federal building fund to meet the capital expenditure -- a capital improvement means we have in our own inventory. >> all right. that's a subject we'll deal with in another hearing. mr. porcari, i understand you have a 130 caught commitment and you may be excused here to >> thank you, mr. chairman. >> not the rest. [laughter] ms. darcy, the court also got off to a late start, but you're catching a period and before i get to those, this is not a stimulus project, but the second block it in sault ste. marie was authorized in the 2007 water resources development act, veto, congress overrode the veto, enormous bipartisan support, urgent need for the second block at this zoo. work has started. what is the status of that work? because it was a new start, it was not eligible for stimulus spending. >> correct. in the current benefit to cost ratio for those who like is not in keeping with at least the one to one ratio that we budget for. >> well, that benefit ratio is an old one i know. i've got the documents. and it does not reflect the new work that is underway in my district with the width of united. bettis will soon be coming online, producing foundry and minimill and electric art furnace capable product that will be moving through the seo. in s. are steel, is under construction now, that building a steel mill on the with saudi range and will be exporting files. the only way that project is economically viable is that we can rail the slab to the superior report and put them on board ship for moving into laurel lake steel mills or in some cases for export abroad. so there is that benefit of cost ratio is drawn. it needs to -- the project needs to move forward and will have to have a more extensive conversation about that. >> we will, sir. >> you are undertaking in the inspection of 820 levees across the country. what's the status of that inspection work and what will be the intended benefits to safety -- to flood protection -- to navigation? >> as we know, where expecting 820 levees. the outcome of that we hope it's going to be able to determine which of those levees are in a position or are providing the level of safety in which they were originally designed for the level of safety that is anticipated by those being protected by the levy. we hope that with this money we've accelerated that levy, which was authorized in the 2007 bill, the entire levy program. >> well, we would like to have periodic reports on the progress being made in the showing of the geographic distribution of those levees so we can -- so all members can understand what work is being done and how it affects their districts or states. you also said that she was awarded $1.2 billion to small business. what determination do you use for small business? >> we use -- the >> the sba. >> and we've been really successful with the aero money in a small business of element. nearly 74% of our contracts -- >> at me some examples of small businesses in the corps of engineer work. >> well, an example would eat at a reservoir, for example, if we were going to be doing multiple things at a reservoir, whether it's a stretch of, whether it's bank stabilization or some kind of upgrade. a small-business contractor who does let say riprap, would possibly be qualified as a small business. we have almost nearly 20% of those small-business owners are women-owned businesses. between 15% and 20% are disadvantaged businesses. so we've been icing pretty lucky -- and because of the size and scope of some of our projects. our contracts are huge. they're not multimillion dollar contracts here they are small and they go to smaller projects as well. we've got some cap objects which are smaller restoration projects, which would've won themselves really well to smaller businesses. >> was a limitation or was it a benefit for the corps of engineers at the authorizing language took off limits new starts? >> well, it has we have a backlog of projects -- >> you have such huge backlog. >> it was a benefit. it was. especially because of all the deferred maintenance we've had to encounter. >> used on huge backlog of things that need to be done. mr. fernandes, i love pda. i was present at its creation. >> pda lets you, mr. chairman. >> i was present on its creation in 1965. i still have my green pen. one that used to sign it into law and a photo of him handing it to me. it's mounted in my office. you're welcome to come and inspect. i think eda does a superb job. and you have moved up quickly and vigorously to implement the meager funds that were over scraps from the table, in my view. with a much more robust figure for eda when the recovery bill left our committee, but by the time it got to the floor of the conference of the senate and all of their hands and it can't take on narrow down. but you've got a two for one with eda. provide the funds to do the industrial park and then you get the business it comes into located. you're the construction jobs, then you have the long-term private sector jobs in that facility. do you have some examples for us of such success stories? >> well, you know, in some cases, mr. chairman, i'd say it's even more a two for one. for example, as part of the recovery act, we funded a number of incubators throughout the country. in those instances, not only do you have the benefit of the media construction jobs come of it than you have multiple businesses created by growing create jobs, graduate from those facilities and continue to become an engine of growth. so i believe in my testimony we referenced 37 million investments in business incubation. one specific example i can give you is in my home state, for the record, these decisions were made before i was confirmed. but in anderson, indiana, there's the city called the flagship center, which was originally funded by eda, i believe in 2003. and as part of the recovery act, we funded an expansion of the facility. and that's a good example where in the original funding of the project, a company called brite automotive was started within that incubator. now that is expanded and become a very strong force in helping the community recover from the downturn of the auto industry. and there's a number of projects like act, whether multipliers go well beyond just a short-term job creation. >> well, those are great success stories. and i was fascinated with the brite automotive. i was not aware of that company until i saw this reference in an earlier eda report. you also put funding into regional innovation centers and trade promotion. explain -- you do have an example in alaska, construction of an expansion to an existing doc. but how is that going to promote trade? >> well, it's going to expand their capacity for exports. they have a facility there with the additional expansion about an eight-acre site. they'll have more capacity to move product. >> and an green jobs, you make a reference to leave certified facility in new mexico. explain a little more about what this project will do. >> sure i can do that. the facility they are in new mexico that's been built as part of the recovery act investment in solar -- that operation does a lot of small-business micro-lending and other kinds of technical assistance. so they'll continue to do work in that field as part of the ability to do more in this building. it's their headquarters facility for the organization. >> u.s. success stories within success stories of funds through eda went out very quickly because those local development agencies, the edr, your edr economic representatives are out on the ground with the communities, guiding them, helping them get their projects ready. so they had this nine, had the engineering, they're ready to go, does he get the funding work. and then you have the following one success story that the facilities him of the businesses in the enterprises that come in to those projects. so i want to -- you know, this is our opportunity to tell the good things that are happening with the recovery act and i want to complete the record. so provided further details on that. >> sure and mr. chairman is a noted in the testimony earlier, the committee has a full listing of over 60 projects, with the project description and the benefit of the individual projects as well. and i think there's a treasure trove of success stories that go on. and because they think other panelists have mentioned earlier that there is the reporting on recovery act of job creation is incredibly conservative. and so, i think it's fair to say that you'll see the larger benefits from these projects in terms of job creation on what's going to be reported. for example, in montana, we funded a revolving loan fund that is part of the timber industry and its a response to some of the changes that i've been going on and they developed their own cluster as a response to changes in their marketplace. under the reporting requirement, we report that one job was created. well, you know, the eda put in $2.7 million. that was matched by the state of montana. 100% of those 492% of those funds have been dispersed to the supplier network et cetera that are part of that cluster. and i think it's fair to us or homes. and so to companies in my district just went out at business altogether. and several in canada as well. those osb -- those company caring os be chunking companies through my district to the south and southwest, that dried up as well. but if you have an idea here of capital for businesses to the technical assistance for borrowers and intermediaries as you describe it, to develop loan packages or other assistance for companies, there are longer-term jobs that are going to result from this. >> absolutely. and if i could, mr. chairman, so much of the discussion today has focused on infrastructure, appropriately. and the infrastructure that's been described has been focused primarily on transportation. and somewhat we might consider more traditional infrastructure. but in terms of economic development administration and the work we're trying to do to drive innovation and business creation, we like to include in our definition of infrastructure certainly incubators, business facilities that can help start a anthony's, proof of concept labs, where we can accelerate the commercialization of research coming out of our universities are out of our federal labs. there is an infrastructure that is essential to the innovation economy, that we certainly play a role in and hope to continue to play an even larger role in at the eda. and i include him on infrastructure a critical issue that we have to address today and that is access to capital. particularly when you look at the deployment of early-stage funding for seed capital, there's a huge, you know, lack of availability of funds. and when we look at how those funds typically get dispersed across the country, there's a tremendous, you know, magnet that drives a lot of the innovation to the area flight osten or maybe the west coast silicon valley. as i travel around the country, there are pockets all over america where you have tremendous innovation. you have strong entrepreneurs, but you have an incredibly difficult time pulling those funders to bring that early-stage capital into the heartland or into other parts of the country. so we think there's an opportunity with eda through our revolving loan funds and some of our other intermediary agencies that we support to help address the critical infrastructure need, if you will, to be able to spread the kind of sustainable innovation-based economic development that i know we all want. >> thank you for that answer him for the work on this very important aspect of job creation and sustainability. mr. rice that. is that how you pronounce it? >> mr. chairman, if transfixed. the mauk was the origin of your name? >> slovic. the last time i was here we have a conversation about that, sir. >> i didn't remember that. >> the pronunciation in the united states hasn't changed since that time. >> that's too bad. but i'm not happy with the coast guard. i'm happy with a lot of things the coast guard does. they don't remarkable job of responding to haiti, the seventh district was on the spot they had a cotter. the two cutters underway and immediately saw her later that day en route to haiti. they set up the first air traffic control support for the airport after the tower was decommissioned by the earthquake the coast guard to the extraordinary work. but, the coast guard has not broken ground on any one of the shore facilities he told us we needed. why? >> well, sir, indeed we have started to work on a number of the projects. but in both of the tuesday indio bay, the facilities out there have begun to work. the other projects, as indicated in my oral statement, they were depending on a particular context strategy that i believe that mr. peck addressed in terms of protest on the significant to a protest which we had to scrap that strategy and move to individual solicitation and words. >> so you did undertake the bidding process and there were protests to the big awards? is that withholding these up? >> well, in the case of a couple or five of the short projects, yes, sir, we had intended to use what they call a national multi-award construction contract, a longer-term regionalized type contract activity that would allow us to issue task orders, you know, with a certain set of contract hers participating in only those particular contract vehicles. each of those five were protested to the gao, in december upheld a protest. fortunately, we have dirty begun to pursue separately in anticipation of that protest being upheld and we have since gone out and now we've solicited i think for two of the five projects that were originally supposed to be done in that particular venue. >> is there something in the contract and procedure that the coast guard followed that can be changed for the future to avoid this type of situation? >> mr. chairman, possibly there is. i don't recall all the specifics of the nature of the protested self. maybe at another time we can talk with the staff on that, sir. >> well, also of the $98 million for the acquisition construction and improvements account, $10 million was designated for the high endurance cutter engineering changes. is this work underway on that now? i have no previous to this hearing had no accounting for that work. >> yes, sir. a number of those contracts for those she prepared to laois and begun. i believe four of the seven contracts have begun. some of the work has not yet begun. >> was the reason for the delay? what is the problem there? >> an example, sir, maybe we were replacing refrigeration systems on eight of the cutters in the manufacture, when they came on board to begin installation, recognize that there had to be some additional work prepared on board the vessel, which delayed some of the work. had to go back, we describe, make sure that the engineering and technical aspects of the work could be done with their unit, which was subsequently overcome in the work was gone. as indicated, for example, hamilton, which you may have aware of was what those cutters are seen in haiti, how'd that work done on it, but it was deferred or delayed until some of those technical issues could be dealt with aboard the ship. >> well, you know, this is -- this stimulus program puts people to work quickly on projects that were needed in case the coast guard shortsighted facilities, vessel work that needed to be done. and it's surprising that the contracting was not properly or carefully thought through. contractors weren't engaged appropriately. now there's some lessons learned for the future? >> i think as the others have stated, there's always lessons to learn this. partners one of the lessons we learned in just terms of bringing the right people together regularly to have the conversation. for example, i meet every monday morning at 830 clock with the entire team including the legislative folks, the technical folks to talk through these particular issues so we can add top of it. i think in terms of the procurement process, we have learned maybe to be of little more nimble, a little more responsive to the opportunities. oftentimes, as you probably are aware, some of the colors of money as i put it, were used to using multiyear monies while this is multiyear money, it wasn't as fun as some of the improvement projects that we undertake with multiyear money. so we've learned to be a little more responsive to that. >> well, you know, that's instructive and important to know. we have passed legislation to change to the house, hasn't passed the senate yet to change the contracting procedures for the coast guard and those longer-term projects. and i think that legislation will deal with the problem encountered in the deep water program. but, i'm very strongly advocating a follow one stimulus to the current program. and we've passed legislation through the house, i hope the senate acts on it, but to be credible we have to be able to show that the government agencies are putting the funds to work as intended in creating the jobs i've expected. so when your weekly review, preset with your associate. >> i will do that, sir. thank you. >> mr. carper, you said the 45% of amtrak contracts awarded to small businesses. >> yes, sir, mr. chair. >> or the small businesses and what is the type of work that they're doing? >> well, i can't get into a great deal of detail, but i can give you an example. they range from maybe 1000-dollar contract in the tampa train station. and many of them are in our stations around the country that would lend itself very well to small businesses. i can get you much more detail on that, mr. chairman in the future. but i also think that other contracts are being led into this construction season, there's going to be lots of opportunity for small businesses as subcontractors on some of our large contracts, mr. chairman. >> well, we give you credit for a great deal of trackwork, of ties that are -- that are being -- 80,000 contract -- concretize are going to be replacing wooden ties. sixty amtrak fleet cars, 21 super liners, 15 locomotives. i give you all that credit at the outset of the hearing. what is the status of that work? >> well, it's ongoing. we turned a believe 15 cars out with 20 and the q. and were very confident that we'll have our 80 cars in the locomotives out by 2011. as i stated in my remarks, this is ten trains sets that we can put on the system. some of our trains on the northeast corridor and some of our corridors were turning people away. so this will be very good input to very good use. >> where is that rehabilitation work being done? >> is being done in our facility right at the way here and bear, delaware and also in beech grove, indiana. >> okay. well, the work ahead of amtrak is enormous. you've been underfunded for at least eight previous years. there are two years of the previous administration when the congress was presented with a bankruptcy budget for amtrak. whether bush omb said it's our intention to put amtrak out of business, break it up, so it's part. congress said no. by very strong majorities, bipartisan votes, we restored amtrak's funding, but only as i sat at the time, enough to keep amtrak's nose above water. well, now we have an amtrak authorization bill passed in 2008. we have the $8 billion in high-speed rail funds, presidents have put into advocate for the stimulus. really foliar authorization in five plus billion dollars and i expect will sustain that for as long as this administration is in office. and now you can begin getting your rolling stock in good shape and track in good shape, switches that need replacement and cat marries in the@@@' american disabilities act and the next five years. as you mentioned, yes, our noses above the water line and were coming out and it's an exciting time for amtrak good i think one of the most telling things that i've seen coming out in the lessons learned and looking forward is putting together a fleet plan that really gives some teeth towards planning towards a future. and if we talk about job creation in the establishment of a domestic railcar industry would be very difficult to do with us and good planning on our part. this is aside from anything that might happen with high-speed rail. this is just our own fleet of existing cars, they range from the age of 60 years old, 60 years old to 20 years old. and i think it's a testament that you've been here and watched it over the years and frankly decades that our staff has been able to keep these cars operating in a revenue service for that long. but with the good work of good stuff and some of who were sitting behind me, there's a team being put together that pass responded to the challenges or to the opportunities. we've seen value of being transparent with congress and the fra and are great partners with fra and d.o.t. and our stakeholders. reaching out to vendors ahead of time to ensure more minority contractors of contracts and to more closely monitors projects and cost so reprogramming can be done in a timely manner. so you know, i know you're seen great changes that amtrak. but from the board standpoint, one of the things that i've seen in my short tenure as two years is the importance of stability and quality personnel at amtrak and that's what we have today. and ceo, joe boardman, and some of the folks sitting behind me in the team he is put together is absolutely critical for amtrak to move forward and to be what this body and frankly the american public wants out of amtrak is a rocksolid and also a visionary organization. and we have that now. and to be able to sustain that is one of the things that amtrak truly needs. we look forward to being a partner in the economic development component of restimulated the american economy. not only in railcar manufacturing and we are doing our part and not by putting the fleet plan the manufacturers plan to see what over the next ten, 12, 14 years or 30 or 40 years actually is going to be needed, just to replace the existing fleet and to take a modest assumption of two or 3% growth each year. to give you an example, over the next 14 years, we are going to need and as a conservative estimate, about $11 billion to start replacing the existing fleet. i might also add that we are also seeing and tracking the job numbers and investment that doesn't show what perhaps on anyone tally sheet. and that's the investment that can come in around quality passenger rail around train station in downtown city centers. my congressman mention that tonight give you countless other examples of that around the country. good examples of infrastructure and transportation infrastructure runner station will be good investments in downtown. being a former mayor of a community, you know, i understand the value of not having to extend new sewer lines and new water lines and build new highways or new roads and take a good quality farmland when you can do infield investments commercial retail and residential in the downtown areas. and what is the way to simulate that is the passenger rail. and we think again your support is and for the many, many years you've been supporting. i look for to working with you in the future. >> thank you for a response and for your enthusiasm. i enjoy hearing it. america is on the threshold of the passenger rail renaissance. because of the bill we passed in 2008, because of the funding president obama have committed in high-speed rail initiative, the eight ilion dollars. because of the funding that the president has committed to the annual amtrak program, to make the investments for the short term in long-term and i want the word to go out to all amtrak employees that there's a new era that there's a faithfulness, dedication, there's years of work against incredible odds have paid off. and now, amtrak love an opportunity to show what it can do to move people by passenger rail at speeds faster than the highway to take people in our society. and with greater numbers of people more efficiently. and the numbers that you've cited are very sobering, a huge backlog of investment needs. but that's true in all of our infrastructure. it's true in every one of the categories represented at the witness table here today. we have underinvested in the underpinnings of our economy. and it was adam smith to well over 200 years ago said that if the public sector does its job well, then the other will be able to do what it does best. in the public sector is providing the transportation needs, the water system support, the aviation requirements, the planning for economic development long-term. and then the private sector, relying upon that and relying on those foundations, will be able to invest for the long term. so for each of the agencies represented here, thank you for the work you've done. thank you for keeping faith with the recovery act, with the stimulus spending to congress and the president have provided. keep it going. take the lessons learned. apply them for the future. not only for the stimulus, but for the standard regular programs. and we will revisit this issue in another four or five weeks. i'll just close with one phase of recovery. last august, i went to visit a project, i 35, southern tier of my district between north branch and russian city. granted, i'm sorry, knife river. knife river construction was doing 28 lane miles, four lanes, seven miles. i went to the gravel pit where they were classifying aggregate and gravel and sand that had been shut down three months earlier or two months earlier and now is reopened. workers are on the job site. went to the highway project at golf. in a format called over one of the tracks. you've seen them come the big l.a. dumpers on construction site. the driver pulled over, shut the engine off, jumped out and tommy and threw her arms around me and dad and joyce fisk, thank you for my job. two months ago, my husband and i had finished dinner. we sent her two boys off to bed and then we just let that each other across the table and said, where do we go from here. our health insurance ended december 31. our unemployment comp ran out three months ago. we have two months savings for our mortgage and are we going to be able to send the boys to summer camp? and then we just cried and hugged each other. in the next morning, the phone rang and knife river called and said we won the bid on either the five. report to work on monday. and now fight and get my 1200 hours in and my husband works for the same company, then our health insurance will be reinstated. we are paying the mortgage, we're paying taxes and the boys went to summer camp. that's the human face of recovery. very joyce fisk's all over america in every state who are looking to buy some counting on us to help make their lives better, to move these projects through, moved to funding a log, to put people to work, to reestablish their self-worth and their identity in the society and in our economy. all of us have jobs. they're a couple million out there who don't. who are counting on us to deliver. you started that process, done it well, lessons to be learned. we'll go forward from here. thank you for your contribution. committee is adjourned. sound @@@@ . @@@@@@@ captioning performed by vitac seeing this parliamenttarian rule every day. to the fellow in broward county, it's going to be just a gift from good to jay leno and david letterman to have the parliamentarian rule on this. there's the chance that the political ridicule would be great over the next month or so. as far as other issues, i think you've got to say card check is dead. a big issue for organized labor. i don't see it going anywhere now. a big issue for walmart. i think cap and trade is pretty much dead. i think anything that involves a carbon tax or any kind of a tax is absolutely radio active right now. no politician wants to be identified with a big tax. there might be an effort to impose upon utilities different energy efficiency standards, but any kind of a robust cap and trade bill, i think is pretty much dead. i do think there'll be a financial services bill for many years. the industry wants one, voters want one, and more importantly chris dodd wants one. i think chris dodd is at a point where he'll sign on anything for a legacy, for a bill that will have his name on it. and his maneuvering in the last couple of weeks on a consumer protection agency has convinced me that he's willing to do almost anything to get a bill done. but i thought for a while and i still think that whatever bill emerges will be one the industry will very gladly live with. i don't think it's going to be a financial services bill that the industry would have a big, big problem with. so we see on so many of these issues, either the agenda being watered down or in gridlock, which brings me to the main thing i wanted to talk about this morning. it's this mantra that gridlock is good. and any good friend tom gallagher and others. for years and years and years have said elsewhere on cnbc gridlock is not good. i'm no longer convinced it's good if we start looking like greece on the biggest issue of all, and that, of course, is our fiscal outlook. and i want to spend a few minutes talking to you about how utterly hopeless it appears to me even if the democrats take a good beating in the fall might make it even more difficult to get anything done on budget deficits. but the one thing i always point out to folks when i do a talk is that i know i'm going to get questions, people saying, welm, why don't they just cut spending? that'll do it, right? well, you can take the entire discretionary part of the budget. we're going to have an expert here in half an hour, you could take all of the discretionary budget and kill it. i don't mean freeze it, kill it. the fda, the fbi, housing, education. flat out kill it and you'd still have a deficit of about $1 trillion a year. because that part of the budget is only about 17%. of course, we're not going to kill it. we'd be lucky to even have a partial freeze. so when i hear people say let's cut spending, that's not enough. and i would think that there are only three options that we could look at to try to get us out of this mess. one would be, i suppose to grow your way out of it. but you ain't going to grow your way out of a deficit this big. i think the obama gdp forecasts are slightly pessimistic, but you're not going to grow your way out of that. a second approach, of course, would be to look at the other 83% of the budget that is apparently untouchable. that consists, as you all know, about half entitlements, social security, medicare, medicaid. i can't see any really meaningful reform of entitlements before this election. frankly, i can't see any meaningful reform of entitlements until after the next presidential election. while greenspan and others have said really smart people could get together in a room, famous quote from greenspan, and within a few hours come up with a solution on social security. that's not coming any time soon. so if you take that off, then you look at, well, what's left in the budget? well, close to 20% in the high teens is defense, wars in iraq and afghanistan, v.a. hospitals, and even this administration, which is castigated for being too far to the left has advocated increased spending in this area by 1.5%. i don't see any big cuts coming there. and then the rest of theg#t@@@u) totally radio active, toxic to any politician who would be talking about a tax hike any time soon. so you can forget all the trial balloons about a fat tax. every couple of years you can set your watch on a bunch of leaks that we're going to go for a tax. it's not going to happen. nobody would go after something that could be demagogued that easily. that would be a huge source of revenues. but that's not, i think, in the cards. another area that i would have said a year ago was ripe for revenues would be to go after u.s. and multi-nationals. there was a big push, and it's still in the obama budget to change the way we tax the deferral of foreign income. that's not going to happen. i think corporate lobbyists have made a persuasive case that to do this would make our companies less competitive. i don't sense on the hill a lot of people wanting to go after that. and maybe our companies will move to singapore or hong kong. even on innocuous tax change, i think they have dropped. whereby hedge funds can pay 15% of the capital gains rate rather than the top rate of 35%. that seems to have stalled, as well. and when i look at any other tax increase options to deal with the deficit, you know, a surtax on the rich, no way. any kind of tax on people making below 200, i'm sure larry summers and obama's economic advisers in private lust after this group. you know, just adds willie stutton said he robbed banks because that's where the money is, people who make $140,000, $150,000, or $160,000, that's the mother load. but does he want to break a campaign promise that he wouldn't raise taxes for anyone making below $250,000? any families below $250,000. if he breaks that promise, i think charlie might agree with me that he could suffer the same fate as president bush the first who broke a tax promise and served only one term. so not only do i not see any new taxes to deal, i think the talk as we come to the end of this year will be maybe do we extend the bush tax cuts for everyone? i would have said a year ago it was 99% that the bush tax cuts will expire at the end of this year on december 31st. it's still probably 70/30. i think they will be allowed to expire with the top rate going from 35% back to the old top rate of 39.6%, capital gains going from 15% to 20%, dividends going from 15% to probably around 20%. i still think that's the likelier bet. but i think there's a growing movement on the hill that maybe we wait a year. maybe we don't want to raise any taxes with the economy still fragile. now, that'll cost another $200 billion or $300 billion. at this point, who's counting? add it in. add it in. so i would just conclude by saying that i certainly agree with charlie's forecast. i think the gridlock will become even more apparent. and for everybody who rejoices over this gridlock, i would have to say that, you know, i agree for now, the treasury ten year bond yield is not a problem, it's around 3.7, diane, that's not a bad treasury bond yield. but at some point the bond market, i think, is going to have to realize that there is a lack of seriousness of the deficit. and this lack of bipartisan compromise, i think, is going to have a significant impact on yields as we go into 2011, 2012, 2013. so on that cheerful note, i will stop. >> thank you. it's been an extraordinary opportunity here, both of you, even though i'm seeing even more red. this is not a participant san comme partisan comment, by the way. it's my anger. i wanted to start out the question. i want you to line up to be able to ask the questions. but i'll start off the questioning to launch it off with charlie and greg both responding to it. and charlie, you commented about the volatility, we're seeing a lot of volatility in terms of the election. and you actually seem to be a little bit of a good thing in that. and i wondered if that contributed or exacerbated our ability to pass legislation. does it contribute or exacerbate gridlock issues? and then on the third one and this flows into something greg says on gridlock, when we talk about deficit reduction, is there any chance of washington getting back to the five-year pay/go rules so we get some compromise over a longer period of time rather than trying to get everything crunched into one year of paying for whatever we pay. that seems to be a more reasonable way to approach it during the clinton years and we got the movement on both sides of the aisle on that. i wanted to start with you, charlie. >> i'm going to leave the substance to greg and deal with the crass politics. i think the level in washington, it's a long time coming and got lots and lots of causes. i think some of it is these members, they hardly know each other. they don't trust each other. there's no -- they have no relationships. and you could take it back to, you know, kind of odd-sounding and tangible things like more and more members now, they just are here tuesdays to thursdays. they leave their families back in the -- in their home states and districts. and so the idea of the socialization, seeing a member from the other side of the aisle at their kids' soccer games, pta meetings or church or playing golf together. and that whole socialization process where people of different ideologies, different partisan strifes could meet off campus and get to know each other and trust each other and build relationships. i think the decline in congressional international travel, that that's actually the old adage about you don't know somebody till you travel with them. again, relationships going downhill. i think it's a product of negative -- of the advertising that we see in campaigns. it's so much meaner and tougher than 30 to 40 years ago so that even if -- even if you didn't run an ad against me, somebody on your team did that was unfair and that was distorted. and i'm going to hold it against you and everybody on your side. and then also, i think the temperament that members of congress on both sides, they're icking leaders almost because with the other side, not because they have any capacity track record or inclination to work with members of the other side. i mean, of the nine top leaders of -- in both parties in congress, i can actually only think of two of them. one on each side that would have the slightest inclination to work with people on the other side. so i think all of that together has, you know, probably a few more factors if i thought about it came together to create just a totally dysfunctional situation. and one that, you know, i mean our country has been through a lot. and the revolution, the civil war, reconstruction. go through it, and somehow we'll figure out how to get through this. but i can't say that i see the path right now. >> i would just add a couple of points to what charlie said. and i agree, you just don't find anyone like christopher sheas. i'd have two other things. the first is, the level of hypocrisy, going back to the budget receive sit is worth spending a minute on. let me rant for 30 seconds about this. you hear kent conrad who was one of the most passionate advocates of reducing the deficit. for years he squawked and wihind about deficits. he's one of the biggest spenders on ag programs. when you look at the number of agricultural subsidies -- now i'll get the e-mails -- they need to be addressed. and to hear him rant against deficits to me is hypocritical. on the other side, you see richard shelby of alabama who held up something like 70 obama appointments because he wasn't getting enough pork in alabama. and he's been one who has been ranting against budget deficits. these guys and gals say one thing and do another on the deficit. and the hypocrisy. it's led to more gridlock and more partisanship. things like c-span. the fact that the nebraska deal that was cut for ben nelson was instantly recognizable and out there on the internet. the average american is far more aware of all of these closed door meetings and it's made it more difficult to get things done. >> thanks, craig. turn to dave. why don't you go ahead? >> thank you. greg, we started to talk about something in the hall. we're going to appoint three governors, they're vetting them inside now, they delayed because of bernanke, they're delaying because of the financial reform bill. could this become an issue, the scrutiny given what you say about bond vigilantes? >> i think losing don is a real loss, you're down to one macroeconomist on the board, ben bernanke, and they have to get one or two more. maybe you can ask christine when she's here tomorrow. i don't know if they could bring yellin back or not. but there's need for macroeconomists. beyond that, the bigger issue is, could obama get a fed that's somehow compliant or easy or soft on inflation? i doubt that. i think bernanke's power is quite dominant at the feds. i think there was a feeling that the fed was becoming too easy, they were too ambivalent about inflation, i think they would get a nasty slap in the face from the bond market, which would begin to raise yields on their own. as you all know, there are a lot of people at the fed who might squawk off the fed starts to look too easy. so i don't see that as a problem. but i do thi they need more macroeconomists on the board. >> andrew hodge. fannie and freddie, there's a little theater going on there right now. just give you my 30-second recap. a couple of weeks ago, they took all the ceilings off on the potential extra funds going to them and unnamed treasury official after the new cycle friday said he didn't think it was going to be used. the republicans, of course, have been attacking this generally and $500 billion bailout. and had put through a bill probably not get passed that to put fannie and freddie on the balance sheet. so they're warming up for the election on this issue. but looked like barney frank counterattacked here last week. counterattacked basically saying those fannie and freddie creditors aren't guaranteed. we're reworking totally new housing solutions and maybe fannie and freddie aren't part of it. so i guess my question is who's going to win this little -- who's holding the bag contest? and is it relevant to anything actually done here potentially or not guaranteeing fanny and freddie creditors and insurance? >> you know, when i talked to people about fannie and freddie, they throw up their hands. i think fannie and freddie will stay in limbo for quite a while. i don't think there'll be any legislation dealing with them for quite a while. i think that what sounded the alarm here on cnbc on friday. and i think it is a serious issue down the road. but i think for now, they're just going to kick that can down the anything on that this year. >> my job is to forecast the economy and stock prices and more stock prices in the economy. and as you know, the stock market's pretty strong, most economists are being more bullish. what impact, do you think, would happen if the economy and the stock market continued to do better? do you think that your opinions that you get from your recipients when you take these? do you think they could change dramatically if that would take place? >> i don't think there is much relationship at all between how the stock market's going and votes. there's just -- i mean, just sort of look at how, you know, the market has come back over the last year. and look at how the anger has gone up. i'm not saying there's an inverse relationship because that's kind of nutty. but i'm just saying that there isn't a relationship. and so i don't think -- i think the market -- it could theoretically go up substantially and not change. i don't think it's likely to change the outcome. the only, you know, for the average voter out there, they don't know gdp from stp. they really don't.@@@úzz solid year going into a midterm election, that's sort of uncharted territory. so i think that even if the market continue to grow, and i don't think -- i don't think that would change how i look at -- it would have to be accompanied by unemployment dropping pretty substantially before i would say, okay, that would affect how i think of things. >> i would just add, i worked with a wonderful gentleman that many of you know. i traveled with lyle and he tells clients it looks like we're in the sweet spot right now. we've got moderate economic growth, low interest rates for maybe a year before we see a rate hike or eight or nine months, virtually no inflation, that's a trifecta, but you go out and talk to retail clients and when i say this, people look at me like i'm on drugs. the average american, and a lot of average investors who have never believed in the stock market rally, you know, are very cynical and skeptical that this rally is for real or that the recovery is for real. it's a pervasive attitude, i think it'll take months and months and months of good data before it starts to turn things around. and i agree with charlie. i think it's the unemployment number more than anything else. in fact, all the years i've been doing this, i've never seen a dichotomy like this between the average american, main street, and people like most of us who do see a recovery that's now underway. >> just -- i just have to add on to that. we all are sitting here looking at the obvious issue, and that is home values. the asset which most americans hold anyways and those are going in the wrong direction and not in the right direction of wealth. before we get to our next question, i want to throw this one out to both of you. you both brought up the lack of sort of bipartisanship is not the right word, but the lack of cooperation, the lack of socialization. and i thought that was very interesting because i know many years ago i heard someone from illinois talking about how they would all drive back to illinois. didn't matter who they were, and i don't want to hold up illinois politics as a stellar example. although greg has told me that new york has gotten worse than illinois with its governors. and i can only welcome that to not be in the high rankings of our governors. i know that barack was originally from hawaii not illinois, which was one of his saving graces. is there any way of curing this mistrust that has developed? we know it's many years in the making, but i don't see any end to it. isn't that almost something in our national policy we have to address now? >> if i could wave a magic wand, i think i would do a couple things. number one, i would push through meaningful redistricting reform so that rather than, i mean the cliche is now rather than voters picking their elected officials, we have elected officials picking their voters. and with basically custom-tailored districts where this one's designed for a democrat, and this one for a republican, and in some cases designed for specific people. and that creates ideologues in both sides. when i move to washington in 1972, you had a heck of a lot of conservative moderate democrats, a lot of liberal republicans and for whatever reason that's changed, the overlapping was tremendous. kept their party from lurching off to a ditch on the left and the moderate republicans kept their party from lurching off to the right. i think changing the schedule of congress in terms of their work to incentivize. that could help, i think, i'd like to get them around the world a little bit more so they're more aware and meeting with business leaders from around the world. meeting our military commanders all over the world. so they're a little bit more aware of that around them. i think that would help enormously. and i forgot my other reason. >> i'd just make this point. i always was very dismissive, scornful of term limits. i'm beginning to wonder if maybe we should dust that off again. and i have to note. i have to note that when you had charlie rangel replaced, he's 79, we placed by pete stark for two days, he's 78, now replaced by sandra evan who is 78. these guys don't get out much. they don't -- and what better example could i point to than here you have the senate that majority leader saying barack obama speaks well for, you know, he's a light-skinned negro -- i haven't heard anyone use the word negro since 1974. you have to wonder, do these people get out very much? i think the lack of term limits may be a problem. >> i feel compelled to add, though, you know, you move around the country and you look at the states that do have term limits. and i would say what is the most dysfunctional state in the united states? california where term limits are alive and well. i think it's like clear cut -- i share greg's frustratius frofru >> i always wanted them to stick around long enough so they can take responsibility for what they messed up. but that's my own bias. >> and you guys are talking about the threat, the tea party candidates could split the vote and i happen to go to a tea party and threw a little tea bag in. i find people are concerned about a government taking away their freedoms to make a lot of decisions. and i see a lot of people all over this country afraid that the government is going to print so much money it destroys the value of their savings. they don't know what to do with their money. and so, i'm curious what kind of political advice you could gi give -- forget the labels, tea party or anything else. for the people in this country that are scared that their government is taking their rights and freedoms away, whatever those might be and they're scared the government is not going to do what they said like you said to take the bull by the horns and limit spending. and they're afraid of their savings being destroyed. what kind of advice can you give them so they don't get marginalized in front of c-span and everybody else as whack-os. because i think freedom and the value of your savings is not a whacko issue. >> the two pieces of advice i would give them is number one, restrain the rhetoric when you're in front of a microphone screaming at the top of your lungs with your veins and your eyeballs popping and your veins sticking out of your -- i mean, that kind of scares people a little bit. and that undermines effectiveness. sort of tone down the rhetoric a little bit. and the second thing would be to select when you're picking candidates, select the person you think that can bring the most amount of change but still have some realistic chance of getting enough broad-base support to win an election. i mean, the purity -- purity is great, but purity doesn't win elections in a lot of places. and that, you know, don't let the perfect be the enemy of the good. and having a candidate that embodies everything you believe in who was destined to lose in a general election doesn't really move the ball forward very much. and so they, you know, so i guess the -- to sum it up, i'd say dial it back and you could be -- you can have an impact. go full throttle and you will be marginalized. >> i just disagree slightly with something charlie said a few minutes ago. he thought maybe the tea party was a little overrated. that it won't have that much influence. i think they're being heard very clearly in this city. the republicans certainly are. they want to co-op them on as many issues as possible. after the massachusetts race, which was a stunning result to everybody in this administration. the best line i heard was on saturday night live, they said martha coakley was such a bad candidate she would lose to dick cheney in berkeley. but at the same time, i think the reaction by the white house spoke volumes. they went almost populous against the banks. if you recall that week, january 19, brown won and within days you had harsh anti-bank rhetoric. even the democrats let alone the republicans are hearing the message. i agree with charlie, if you look a little -- if the party looks a little less threatening, moves a little bit more to the center, it's going to have a big, big influence. >> let me clarify. i've got a column coming out tomorrow. to me when i think the tea party movement i think is overrated, i think they're kind of a tip of an iceberg. i think they are representative of a much broader group of people who aren't going to meetings and who aren't screaming in the television radio talk shows, but who are disaffected and who are expressing their concern. these are folks that you will never be able to explain t.a.r.p. to them, never be able to explain the necessity in my mind for the takeovers and some of the bailouts. the thing is, these are some of the things that i personally think were essential but can never be adequately explained to a lot of people. they're just never going to accept it. but the thing is -- i think the tea party becomes a convenient label for a much broader group of people that are not quite, you know, they're not quite as vocal or not nearly as vocal or visible, but the polling data suggests it's a big group that's out there that's quite unhappy. and i think those people -- i'm not diminishing their impact at all. >> one last question from jim -- >> really quick. >> go far out in your crystal ball, election is over, november 3rd, republicans won the house and at least dramatically reduced the democrats' majority in the senate. who's the speaker of the house next year? and, you know, and the next two below. and two, is there any chance of that happens that we get a lame duck session that would actually approve the pending trade agreements with colombia, panama, and south korea, which would add a lot to economic growth. thank you. >> oh, lord -- >> and you've got about 30 seconds to answer it. i shouldn't have let jim give the last question. >> let me just say, if republicans took over the house and i know there are a lot of sort of young rising stars on the republican side. but i would be very surprised if they took the speakership, the gavel away from john boehner. he was the field commander. and, you know, i'm not sure he'd be there forever, but i couldn't imagine they would take it away from him, you know, if they were victorious. if democrats were to lose their majority, my guess is that nancy pelosi probably would head on back to california or wherever before too long. i don't think she'd want to hang out as minority leader to be perfectly honest. and there's just a whole cadre of rising stars. i think you'd be looking for generational change. >> the brightest of all bright lights is paul ryan in my opinion. he's a very likable guy, intriguing fellow. he's someone clearly to watch. i'd just answer the question this way, which way does barack obama go after the butt-kicking that the democrats are going to take in november? does he decide he wants to do a bill clinton and triangulate? does he want to be like a tony blair and play small ball and get modest things? bill clinton got nafta, got welfare reform, clinton did get a few things done. does obama want to go that way? or is he as his detractors claim a very cerebral law professor who doesn't have the guts for politics that bill clinton had? the jury's out on that. >> i think one thing, when you look at what we're seeing, one thing is because of these campaigns, democrats are absolutely terrified of raising revenue. republicans are terrified about cutting spending. and that's sort of the policy paralysis we have. that they've been so stigmatized by negative advertising that neither party seems willing to do what good put these two parties on the planet to do. and democrats define revenue and republicans to cut spending. and that sort of the bottom line where we are right now. and i don't know what changes that. >> a crisis and there isn't one. >> thank you. i want to give a big round of applause for charlie and greg. and on those final notes, i know now we're moving into deficit >> good morning. we would like to welcome each of you to our annual hearing on the budget of the food and drug administration. dr. hamburg, we thank you for being here today. we are pleased to have you testify in front of this committee for the first time, especially now that you have had a little while to get settled in your position. we also appreciate the participation of your colleagues, mr. patrick mcgeary and norris cochran. the f.d.a. has been on the receiving end of substantial budget increases over the past several years. between 2007 and 2010, the f.d.a. budget went up by 50%. this funding was important. as we all know, the f.d.a. is responsible for oversight of a wide array of consumer goods used by every american. often multiple times each day. in fact, about 20 cents of every dollar spent is on a product regulated by the f.d.a. this includes, food, drugs, medical devices, dietary supplements, vaccines, animal drugs and foods, and most recently tobacco. the f.d.a.'s budget for a long time had not be representative of the task before the agency. this subcommittee in recent years has been working in a bipartisan manner to reverse that trend. this year's budget request again includes increased funding for the f.d.a., although about one half of the increase provided in fiscal year 2010. while some believe this is a cause for alarm, it's a realistic reflection of the need for the government as a whole to slow down spending. as it is, even though the budget proposes a smaller increase for f.d.a. than the past few years, it is still a larger increase than nearly all of uska and most of dhhs. brief review of the budget shows three themes, which are food safety, protecting patients, and advancing regulatory science. there are proposals to save money through contract savings and the enactment of new user fees. in food safety, increases are proposed for activities, including the establishment of an integrated food safety system, a modern import safety system and smarter surveillance and enforcement. for patient safety, increases are proposed to improve the safety of imports and high risk products, expand partnerships with public and private entities, and increase the f.d.a.'s capacity to review generic drug applications. the initiative includes proposed increases that will help strengthen the f.d.a.'s scientific leadership staff in emerging technologies, the increases are important, but we have concerns. we are concerned that without adequate funding levels to maintain f.d.a. 'tises, inspector and reviewers, the goals you list are not achievable. i want to repeat something said last week. i believe the goals for this subcommittee this year will be to produce a bill to protect the gains we have made over the last few years, ensure that programs vital to the health and safety of americans are quarterly funded, and it do so in a way that shows fiscal restraint and responsible austerity. the f.d.a. obviously is vital to the safety and health of americans and will be quarterly funded this year. we won't allow the agency to lose the ground it has made up. we all need to do more with less, and no one is exempt. senator brownback and i will be looking at the budget in a bipartisan manner to make funding decisions. it will not be an easy job but one we must do right. i am sure you agree, doctor, and in that spirit we are looking forward to continuing our work together. let me turn now to senator brownback. >> thank you, mr. chairman. it is a pleasure to work with you. senator kohl and i like to talk about basketball, too. we have two top 10 teams in the increase increase basketball tournament, so we are hopeful we can move on forward as well. next to the wheat harvest, this is kind of the big season in kansas, is basketball. it is a pleasure to have you here, dr. hamburg. it was good to visit with you in the office and i look forward to your presentation here. i want to follow up on the visit we had because i've got some suggestions i hope you are willing to look at. your staff has been willing to consider, about rare and neglected diseases in particular in the united states and around the world. to help jumpstart this effort in rare and neglected diseases, i worked with the chairman to include a provision in the current year's appropriation bill that included two grooms to review the agency's process for approving medical products for the treatment of rare and neglected diseases. when fulfilling the agency's requirements under this provision, i have some ideas i hope you will take into serious consideration, and i hope these teams will be meeting and reporting out soon. to date, approximately 7,000 rare diseases have been identified. these diseases affect more than 30 million americans, but there are only f.d.a. approved treatments for approximately 200 of these 7,000 rare diseases. so if you happen to be fortunate enough to be one of the 200, have a disease that -- have one of the 7,000 diseases and you happen to be than above the 200 that has an f.d.a. treatment, you have something to work on. there are 6,800 other diseasing without treatment at all, and they are not benefiting from the progress. this is unacceptable. there are 30 million total americans in this category. in addition, there are billions of people worldwide suffering from diseases that are often ignored because there are no market incentives for engaging in the costly process of developing a products for f.d.a. approval. according to the world health organization, one in six people worldwide is affected by at least one neglected disease. one in six. this is particularly astonishing when you consider that only 1% of the drugs approved since 1975 were developed to treat such diseases, that affect one in six people in the world. this, too, is unacceptable. solving these problems will involve many government agencies and the cooperation of the private sector. today i would like to talk about something the f.d.a. could do to substantialally impact this category. i believe, and a lot of people agree, that f.d.a. should simplify the process for treatment of deadly rare and neglected diseases. it is my expectation that the f.d.a. uses safety, but they must establish a secretary track for product approval that takes into consideration the unique nature of the product being approved, including the ability of manufacturers to find large enough populations for clinical trials, the willingness of patient groups to knowingly accept certain risks and the global public health benefit. without to go these things, i think it is highly unlikely we find treatments for these 6,800 rare diseases. i don't see how it happens. i thick we are probably stuck on this 1% figure of work in these neglected diseases that affect one in six people globally. that is completely unacceptable, and it doesn't need to be this way, and you are the person most well positioned to address this. i hope you will be able to. i hope you can look at this category. you have a lot of other issues at f.d.a. i think this is among the top tier of most important. mr. chairman, thank you for holding the hear hearing. >> thank you, senator. wie turn to dr. hamburg for your statement. >> thank you very much, chairman and senator brownback. i am pleased to ent the president's fiscal year terrell budget. the budget director for f.d.a., and norris cochran are with me this morning. my testimony outlines the fiscal year 2011 budget request. it also includes a summary of recent developments related to our new responsibilities to regulate tobacco product and other important f.d.a. initiatives. as you know, this is my first time before this subcommittee, and i look very much forward to working with you. i deeply appreciate the support that you have given to the f.d.a., and i know that you share my determination to make sure that we can count on as a nation a strong, fully functional f.d.a. and as you point out, f.d.a. is a unique and important agency responsible for programs and activities that affect every american every day. the fiscal year 2010 appropriation reflects your commitment to f.d.a. and the health of the american public. those fubbeds will allow f.d.a. to make progress across a wide range of public health priorities which are essential to the health, quality of life, safety and security of all americans. so again, i thank you. the proposed fiscal year 2011 budget includes $4 billion for f.d.a. programs, which is an increase of $7575 manage, with $601 million in user fees and $154 million in budget authority. we are proposed three major initiatives in areas vital to our mission, transforming food safety, protecting patients and advancing regulatory science. these initiatives are crucial for the modernization of the agency to the challenges presented by the 21 st. century. the transforming food safety initiative reflects president obama's vision of a new food safety system to protect the american people and is based on the principles of the president's food safety working group, prioritizingre

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