Transcripts For CSPAN3 Key Capitol Hill Hearings 20160422

Connected vehicles or autonomous selfdriving vehicles. Department of transportation thinks of this as connected automation. Its really both. They both give you sort of added safety. Connected vehicles or basically v to v, vehicle to vehicle, vehicle to infrastructure, v to x or anything else, basically theyre all going to be able to talk. What we know is studies so far suggest that even two applications of v to v could prevent 600,000 crashes and save 1,000 lives. So it has huge opportunity overall. Potentially 80 of crashes that dont involve an impaired driver could be prevented with v to v. So we have actually introduced a rule making which has been accepted by omb for review just to try to set up a consistent piece of equipment that would be used for the whole system in the United States. Okay. When do you anticipate this being online . Or you know, are constituents the availability. Give me a timeline on that. Right now its been accepted by omb as under review. Thats kind of where we are, answering their questions. One year . Two years . Any kind of an estimate . I can tell you the proposal is to have it out. Ill check the final proposal. We have a specific in the proposal for when it will be on the road. My cautions just to say that our piece has it out proposed, currently under review at office of management and budget. Thank you. Next question, nhtsa has announced several initiatives and workshops on numerous issues over the last six months and plans to complete work on these topics prior to the end of the administration. Is that correct . Yes. How are you ensuring adequate work and thorough Stakeholder Engagement is done on these important issues before the final before the final actions are taken . Well, for a variety of activities they are in fact open Public Meetings. Retooling recalls was open. We had others, cognitive distraction, live webcasts for things. Right now the secretarys announced in six months nhtsas going to put out several things if youd like to talk about autonomous vehicles. We just held the first Public Meeting for that. Theres an open docket for that. So for activities leading to specific products, theres both some transparency and involvement from stakeholders. Very good. Thank you. What are the Key Takeaways from the Cyber Security round table that nhtsa held in january . Fascinating exchange. Because we had manufacturers in there with independent researchers and pretty much the whole mix. And i would just say, one, it was fascinating to see that everybody thought you needed nimble and flexible. Cautious about regulations. Because they could be outdated cybersecuritiwise before theyre even in place. And the other is everybody identified this as critical not just for protection but for the trust of the American People to see this automation as things get on the road. Very good. Thank you. Thank you, mr. Chairman. I yield back. The chair thanks the gentleman. The gentleman yields back. The chair recognizes the gentleman from california for five minutes. Thank you very much. Thank you, dr. Rosekind, for coming forth and answering our questions. And youre welcome to ask questions as well. But just wanted to thank you for all the work that you do and please if you would translate that to all of the good workers that you are surrounded with. My first question has to be speaking of workers and the people youre able to surround yourself with, do you have as many people in your organization that you would need to address all the issues that you recognize you somebody addressing or getting in front of . No. I had a funny feeling that would be the answer. But if youll let me, i will just say please. Well, thank you. Because this committee and the fast act is helping us get there. So office of defective designations, which weve talked so much about, has the potential now for us to hire 57 new people and address that issue. So thank you so much because thats a huge difference for us. 57 new people. Im glad we were able to make sure. Congress has the power of the purse. So thats up to us to give you their budgets, et cetera. Im glad you did that. But being an engineer myself and someone who understands how the best way to get in front of an issue is to be proactive, and an organization that has to do with Traffic Safety like yours, its very important that people understand that unfortunately its not that often that the United States constituents receive the benefit of other countries good work on issues like this. We tend to be the leaders. Isnt that the case . Not always, but tend to be the leaders more often than not. And i try and preface this by saying i am biased. But id like to say certainly in a lot of the Technology Innovation the u. S. Is a leader. Yes. And i believe thats the case both on the issues were talking about today and in many, many things. Its something we as americans should be proud of. But with all due respect, government does have its place, especially when it comes to safety of the American Public and anybody who comes to our great country and assumes that safety is a priority for us and that were continuing to make it a priority. So once again, thank you, doctor. Id like to ask you, as im sure youre aware, in february the center for auto safety filed a lawsuit against the department of transportation alleging that by failing to Public Technical Service bulletins, or tsbs, in their entirety, online for consumers, d. O. T. Was in violation of map 21s finally, on march 25th, d. O. T. Announced that it would publish tsbs, and it has been brought to my attention that full tsbs are now available on the website. I look forward to ensuring theyre all up as soon as possible. However, members of this committee worked very hard to have tsb publication included in map 21. And while im pleased that htsa is beginning to finally comply with the requirements, i think its unfortunate that it took a lawsuit to get nhtsa to make that happen. Id like to ask you about the Early Warning reporting system. That system was put into place in 2000 after the highly publicized Ford Firestone tire recalls, Early Warning reporting, intended to alert nhtsa to vehicle defects as early as possible, ideally helping to identify major problems and minimizing risk to the public. However, last years audit by the department of transportation offices Inspector General, highlighted some problems with the current Early Warning reporting system. It says that safety defects are often miscategorized and that manufacturers have wide latitude on what information theyre required to provide. Dr. Rosekind, what improvements or changes if any is nhtsa making to the Early Warning reporting system to respond to the findings in the i. G. Report . So this came up in opening comments. This is an opportunity to give everybody an update. There were 17 recommendations that the Inspector General identified. Early warning reports. Ewrs were one of them. We made an aggressive commitment to finish all of those recommendations within a oneyear period. So by the end of june 2016. And the Inspector General was very clear nobody ever does, that actually give them a schedule. We have six of those closed ahead of schedule and the other 11 already identified and on schedule to finish by the end of june 2016. Weve also done one other thing that nobody ever does. Weve actually set up technical meetings with the i. G. s office to tell them what our plans are to meet those recommendations. So we have an ongoing discussion with them to make sure we meet them in an appropriate closed way. So 11 out of 17 have been addressed ahead of schedule . 6. First 6 ahead of schedule. Were working on the other 11 which are on schedule. On schedule. Yep. It sounds like youre not only a good listener, youre a good action department. So i wanted to thank you so much for doing that. Ahead of schedules great, on schedules good. And i hope youre able to do that. Not that 50ud want to opine but i hope that on this side were as good a listener as you are. Thank you, mr. Chairman. Gentleman yields back. The chair recognizes miss schakowsky from illinois for redirect. Thank you. Just a few weeks ago the new chairman of the National Automobile Dealers Association, or nada, said that or maybe its nada. Nada sounds dpsh i dont know. I dont know which it is. Said we shouldnt have legislation requiring dealers to fix all recalls on cars before they can be sold because only 6 of recalls are hazardous. I have a letter that we received today from callie houck, mother of raich sxl jacqueline houck, and alexander bringman, father of jewel bringman, and it says as parents of precious, beautiful, talented daughters killed by recalled cars with lethal safety defects we are appalled that you, its a letter directed to jeff carlson, chairman of the National Automobile Dealers Association, that you would claim that only 6 of recalls are hazardous. Our daughters were driving or riding in cars that were the very defects that you claim were not hazardous and therefore acceptable for your car dealer members to sell to the public without repairing the defects first. So dr. Rosekind, i think it really is important to clarify this point. Does nhtsa require manufacturers to recall vehicles if a defect is even not safetyrelated but all defects . Weve been at this before, havent we . We have. Yes. And a defect thats an open recall needs to be fixed whether its new, used, or rental. And we just heard the congressman say the assumption in any one of those circumstances is that there is no open recall, there is no defect. So do you plan to reply at all to the notion i mean, first of all, is that accurate in your view, that the deaths of these girls, women, was caused by something claiming to be nonhazardous by the Dealers Association . This is one of those ongoing challenges of individuals trying to sort of split. Thats why were pretty straightforward. Any open recall needs to be fixed, period. So are dealers prohibited, then, and should be prohibited from selling or leasing used cars until all recalls have been repaired . That was in the grow america act. And we believe any new, used, or rental should be free of defects. I hope that is really strongly communicated. I feel an obligation to the people from whom we received this letter and to the lost daughters of theirs that we make that perfectly clear. Thank you. I yield back. The gentle lady yields back. And that concludes questions for the first panel. Dr. Rosekind, thank you very much for your forbearance in staying with us today. Well take a twominute recess to si to set up for the second panel, at which time well reassemble. Cspans washington journal live every day with news and policy issues that impact you. And coming up friday morning, jeff adeleson, politics reporter for the new orleans advocate will join us by phone to discuss the debate over the removal of confederate monuments in new orleans. New orleans mayor Mitch Landrieu has backed the City Councils efforts to remove a number of confederate monuments on public land. However, the city remains divided on the issue. And then hannah smith, senior counsel for the beckett fund for religious liberty, will be on to talk about the recently argued zubic v. Burwell case. The case deals with religious liberty and the Affordable Care acts contraceptive mandate. Sxris nove zellic, Founding Member of the 90s band nirvana and author of grunge and the government lets fix this democracy will join us to discuss fair vote which advocates for a variety of electoral reforms. Be sure to watch cspans washington journal beginning live at 7 00 a. M. Eastern friday morning. Friday a discussion on the challenges and benefits of integrating women into military combat units. A panel of military and Foreign Policy experts talks about the issue at the council on Foreign Relations starting at 8 30 a. M. Eastern on cspan 2. Saturday april 23rd is the 400th anniversary of William Shakespeares death. And on that day the Folger Library here in washington, d. C. , which has the largest collection of shakespeare documents and memorabilia in the world, will be hosting an event commemorating his life and his impact on our literature, our language, our politics and our history. Book tv will be covering that event live. It begins at noon eastern time. And afterwards well have a live nationwide callin with shakespeare scholars. So you can join in the conversation as well. Henry folger was the president of the Standard Oil Company and a shakespeare buff. So he and his wife spent many years and many dollars collecting shakespeare artifacts, documents, memorabilia. Its the Worlds Largest collection of shakespearerelated documents. So join us on saturday april 23rd. Well be live beginning at noon from the Folger Library for 400 years of shakespeare on book tv. Next a hearing on improving Water Supplies through new technology. The Senate Environment and Public Works Committee hearing is 45 minutes. Our meeting will come to order. We apologize for being a few minutes late. We had a vote at 10 00. As i said, thats our daytime job and we have to do it. Drought conditions is still well, they have and they still affect many regions of the country. California and oklahoma have been dramatically affected. This morning we have witnesses which represent Orange County, california promising new technologies of desalination. And the u. S. Army corps of engineers. For the vast majority of the past six years, oklahoma suffered from a devastating drought event having nothing to do with global warming, i might add. As the drought reached its worst in the summer of 2014 more than 60 of oklahoma was in the u. S. Drought monitors extreme category. More than 30 of the states land area was experiencing exceptional, and ill put that in quotes, drought or worse category. Communities were rationing water. Some communities in the hardesthit areas look to reuse voice water and tapping unconventional sources, those for nonpotable used. Evaporating lakes and ponds in oklahoma forced cattle men to sell their herds and Oil Companies to search for increasingly Expensive Technology to increase production. Abundant rainfall occurred nearly a year ago which caused dangerous situations throughout oklahoma but greatly improved our water supply, at least for the time being. Our Water Supplies are also overtaxed with old and failing infrastructure not able to pace with demand. These problems affect communities all across the nation. Its not exaggerated to say that water supply issues limit growth and pose a real threat to local and regional economies and peoples quality of life. However, in oklahoma communities have started planning with business groups, agricultural interests, and the Energy Sector on the local level to develop Regional Water action plans to resolve their mutual water problems. The foundation of the water action plan model demonstrates that water as the key element in state and local economies, it focuses on unifying and forcing stakeholders to develop near, short, and longterm Regional Strategies to maximize reliability and diversify the supply of water. The severe Drought Conditions oklahoma encountered forces us to identify new sources of groundwater and further develop our existing underWater Supplies to address our overreliance on surface water to build infrastructure and pipelines to reliable underused Water Resources. Building new wells, and weve tried it all. City planning and Regional Planning has been the most efficient way of preparing to address any water supply problems. But there are supportive roles for state and the federal government to assist our communities, and there are roles for the corporate citizens as well. For example, one area in oklahoma, hardest hit by the drought, is the city of enid, oklahoma. One innovative example by the Coke Industries is their nitrogen plant, one of the largest fertilizer production plants in north america, uses the city of enids treated wastewater for implant cooling water. Eventually this reuse project will free up almost 5 million gallons of water each day. Thats almost 1 2 of enids total current usage. The federal government can have a role to play in assisting the regional infrastructure planning among states. An example of that are the chloride control actions on the red river between oklahoma and texas. These projects were specifically authorized by congress, dating back to 1966, with chloride control studies beginning at the red river as early as 1959. Chloride control actions in oklahoma and texas has and will provide new drinking Water Supplies, increased irrigation and improved downstream water quality. In fact, mr. Dalton and i are currently working with the Tulsa District Office to develop a general reevaluation and review and record a decision for the elm fork chloride plant in oklahoma. At one point some reservoirs in oklahoma were less than 20 capacity. Now many are nearly full with multiple year supply. Although presently the drought has subsided plans must continue so we know its going to be coming back. Its kind of funny when you talk about this issue. For me anyway. Because this was an issue in oklahoma way back when i was in the state legislature. The big issue at that time was transporting of water from eastern oklahoma and to western oklahoma. And dp its one of these situations that made everybody mad. This is not a new issue. Its not just local to oklahoma. Its across the nation. Senator boxer. I really want to thank you so much for this hearing. We have some contentious hearings. I dont think this lunn will be such. Because were going to discuss Innovative Technologies to improve water supply. And this is something very dear to me and significant for my home state of california. And ill tell you, i have gotten into some pretty heated conversations. I was telling the chairman, in my state because i really do support these technologies. Others just turn away, say its too expensive or you know, we shouldnt do this, there could be unlimited supplies of water for growth and all the rest. To me this is a moment in time. Whether we believe Climate Change is causing these droughts or not. Whats the difference . We dont have to fight about that. The fact is were dealing with these droughts. So i know this issue is deal to me as i see what has happened even though weve had an el nino this year it didnt live up to expectations. It certainly has done a lot to help us. But we know were looking at longterm problems. We have horrible arguments between all the stakeholders, whether you know, between the agricultural people and the fishing industry and the urban users and the suburban users, and they fight all the way to the courthouse door. And mr. Chairman, you and i know when you get to the courthouse door one thing happens. Delay kufrks. We dont know the rules of the game. We need to have a water supply that is there for us. Now, im so pleased to have Denis Bilodeau here from Orange County Water District. Youve been engaged in the development and implementation of innovative water supply technologies for many years. Roger county my notes say, tell me if im wrong, is the sixth largest county in our nation. And we have 2. 4 million people. Just in Orange County alone. Is that about right . We have 2. 4 million we have 2. 4 million in our service area. Theres 3. 2 in total. 3. 2 million. 2. 4 in your service area. So we are literally talking about, you know, making sure people can live comfortably and have the water that they need. This has forced our governor to declare a drought state of emergency. We have water restrictions. And again, even though el nino has done better up north, its not done that well down south. We know that we can expect more droughts in the future. So we do face many challenges associated with this ongoing drought, including overtapped aquife aquifers, mandatory water restrictions, threats to our bay delta ecosystem, to our fisheries, to our agriculture. And when you mention water in california, its just everybody just, their back goes up because there are so many arguments going on over diminishing resource. And my view as a United States senator, i dont take sides between the jobs in the fishing industry and the jobs in agriculture. Theyre all jobs. I dont take sides. Im trying to get everyone to the table. And i believe, and thats why im so proud and my chairman shares, this that we need to look at ways to avoid these terrible battles. And that means a bigger water supply. And you know, when you get into where do you put a dam, and that starts the march to the courthouse door. But if we were to be able to move forward with desal, move forward with recycling, move forward with conservation that makes sense, we dont have to fight over these supplies. We need to Work Together to expand the pool. By using our water more intelligently and making sure we can tap into these technologies. So were very fortunate, mr. Chairman, to have two excellent witnesses. We probably have three excellent witnesses. I know two of them. Who will offer thoughts on how the government can help. And the Orange County Water District will explain how it converted waste water into 100 million gallons per day of clean safe drinking water. Enough for 850,000 people. And mr. Price will talk about his experiences with desal in the middle east and particularly in israel, where so much truly innovative water supply activity is occurring. So when people look at desal and they say, oh, what are you thinking . They should just talk to the folks who have been living with this technology for a very long time. And im also pleased that the core is here because we have such an important responsibility for managing water around the country. The corps operates 30 dams and reservoirs just in california. The corps must employ the latest technologies to ensure these reservoirs are operating efficiently and can meet the growing water supply challenges. I think today we can look for these opportunities to invest in new technologies. We can also learn from our International Partners such as israel, who has confronted the supply challenge. In closing i would say this. We have a chance in this werda bill to make some more history, mr. Chairman. To take a look at this and start a new way of looking at water supply because drought faces us. It always has and it always will. It could get worse. Were not sure. But we cant take a gamble on water supply. Thank you. You know, one thing, senator boxer, that neither one of us mentioned and that is the significance of the water in terms of our military. It happens that right now in the audience we have bill burgess and several of them from the city of from forest hill, which is the city of lawton. And right next door to it Altus Air Force base. And its something that really is critical because the needs of those two, weve gotten to the point where they always have to shut them down from time to time. Thats a huge issue also that is affected by this. We welcome you to observe. Youre observing a hearing where barbara and i love each other, we dont have any disagreement. Its rare. But i hope you enjoy it. Now, well start, we have three witnesses remember this moment. We have three witnesses, mr. Denus help me pronounce this bilodea snuchlt. Bilodeau. First Vice President and director of the Orange County Water District as senator boxer said. Mr. James dalton, we know him. Chief engineer in the arm can i corps of engineers. And david price, adviser to the middle east Desalination Research center. We welcome all three you have here. Well start with you, mr. Dalton and work down. Try to keep your Opening Statements to close to five minutes. Youre recognized. Chairman inhofe and Ranking Member boxer and other distinguished members, thank you for the opportunity to prevent information about the u. S. Army corps of engineers civil works program. Activities related to drought and drought technologies. Id like to briefly discuss drought in general terms and then provide some information weve taken with respect to drought and finally touch on drought technologies that were investigating. Drought of course is a deficiency in precipitation over an extended period, usually over weeks, months, or years, resulting in water shortage causing adverse impacts on vegetation. But drought is a lot more complex than just a lack of water. Drought is a relatively common weatherrelated phenomenon in north america and occurs to some extent every year in some parts of the u. S. , affects our agricultural water supply and many other aspects of our wellbeing. The corps performs Water Management activities at its reservoirs consistent with the projectspecific congressionally authorized purpose or purposes for each reservoir. Two missions we often balance competing needs during periods of drought are flood Risk Management and water supply. Its important to keep in mind that most dams that occur in drought area are solely authorized for flood Risk Management. For instance, as senator boxer just mentioned, that the corps orpts operates about 30 dams and 17 in california. 17 of those are mostly for single purport flood Risk Management. 13 have multiple purposes. Generally speak the corps will not construct a project for solely for water supply but may include water supply as a purpose in a project constructed primarily for one or more of the three main missionaries of the corps of engineers, which are flood and storm damage risk reduction. Number two, commercial navigation. And three, for aquatic ecosystem restoration. The corpss water supply authorities recognize that the states and nonfederal entities have the primary responsibility in the development and management of their Water Supplies. Water rights of course are the responsibility of the states. The corps does not own or sell water. Water supply storage in a corps reservoir may be a key component of the water supply plans for nonfederal entities. And so nonfederal entities that do not have storage in corps reservoirs may request that the corps study and consider reallocating existing storage from another authorized purpose to water supply. The corps reservoirs are operated according to water control manuals, which by policy include reservoir rule curves and where appropriate it includes drought contingency plans. The purpose of the drought contingency plans is to provide a basic reference for Water Management decisions and responses to a water shortage in a basin due to drought. The corps is working on methods and web tools to assist in understanding the projected droughts and how will this impact corps projects. The results of this work will serve as a guide for developing a strategy to update the existing drought contingency plans. The u. S. National Climate Assessment published in 2014 reported that climate is changing and is projected to continue to change. The expected changes vary regionally and include warming temperatures, resulting in altered precipitation patterns and increasing heat waves and changing snow patterns and droughts. Two current efforts that we have under way to try and assist with our ability to manage Water Resources for climate preparedness and resilience. The first effort is developing and implementing methods to update our drought contingency plans to account for Climate Change. A second method is to enhance reservoir sediment information to assist in climate preparedness and resilience by helping to identify current and future reservoir sediment volumes which can affect food and water supply. And the third effort we have ongoing is the forecast in foreign reservoir Operations Research at lake mendocino, which is a pilot study that would use Atmospheric River forecasting to inform Water Management decisions in a manner which reflects current and forecasted conditions. The results may indicate whether this technology can be applied in actual operations of certain projects. In summary, the combinations of water control manuals and the deviations we can have with those manuals provide a great deal of flexibility to respond to shortterm or longterm needs based on best available information and science consistent with each projects congressionally authorized purposes. Thank you. Thank you, mr. Dalton. Mr. Bilodeau . Thank you, mr. Chairman, Ranking Member boxer and members of the committee. I am Denis Bilodeau and i am the first Vice President of the board of directors of the Orange County Water District. Im deeply honored to appear before you today to discuss the most pressing issues of our time, a provision of a safe and reliable water supply. The Orange County Water District is located in Fountain Valley in Southern California and provides ground water to Orange County, including 19 cities and water agencies serving 2. 4 million people. Our main source of surface water continues to decline. Imported Water Supplies from colorado are restricted. Pacific ocean. Over a fiveyear period 20 million in federal funding from the bureau of reclamations title 16 program leveraged over 72 million in state, local and private funding to provide for the overall 481 Million Construction of the groundwater replenishment system and we greatly appreciate that. The gwrs has allowed our region to take control of our future. Theres no one size fits all solution. The gwrs establishes a Technology Foundation to design and build individual approaches to Sustainable Water needs. Therefore i encourage the committee to include funding for water reuse in the worda reauthorization. Secondly our district is currently exploring purchasing more than 50,000 acre feet per year of desalinated sea water or enough water for more than 400, people. From the proposed Huntington Beach project as a way to increase local Water Supplies. The proposed project will be built and operated in the city of Huntington Beach. The project is scheduled for a final hearing later this year. If approved, my board will consider moving forward a a Purchase Agreement for the water. Finally, one of the most Cost Effective solutions includes Water Conservation. Conservation through reduced demand is not going to solve our overall need assure we have adequate Water Supplies. In order to supplement our Water Program a region and a core made on the santa ana river. Rather than using prado dam for a single purpose, flood protection, we recognize the potential for saving water that could be put back into our aqua forfor reuse. Senator, boxer, you were instrumental in assisting us in the negotiations with the army core. And we have secured feet due to your efforts. And chairman, we thank you for your effort towards the passage of the bill and we facilitate our recommendations to the committee arise from our experiences over the past few years working with the core to implement a longterm agreement to store water in a Public Safety and environmentally protected manner. Clearly stated a clear statement on the priority to approve and implement Water Conservation activities needs to be made a part of reauthorized word up. Also, we need a clear statement to insure costs are fullied a quated to make sure its allocated to the local water agency. The ability to facilitate an equitable agreement may seem like a Cost Effective solution but we need a strong statement on the matter and we stand ready to support the community. Again, i thank you for the opportunity to appear before you today. Thank you very much. And mr. Price. Chairman, Ranking Member boxer, im kevin price, Senior Science and technology advisor. I have the new application of nonconventional water to reduce the risks of drought, increase jobs and standards of living and to assist in resolving conflict around the world. Ill focus my remarks on desalination and indirect requotable water use. Earlier in my bureau of reclamation career, during one of my trips, i was asked by a Television Reporter why someone from the u. S. Was attending the Israel Desalination Society meeting. I explained that the problems and solution that israel was currently solving would be important to the u. S. As it faced similar problems in the future. I currently work for medrik. Which is an International Institution created in 1996 as part of the middle east peace prau process and hosted by the sultan and as well as the u. S. Department of state. They work to address two grand challenges, water and peace. This is done through Capacity Building and training and research. Theres an important technical distinction that must be made. Water pureification means a number of things depending on the audience. For many, this means removing suspend particles, and very large molecules from helping them stick together followed by filtration. This will not work with many nonconventional sources because a major portion of the contamments is dissolved, and the removal of dissolved materials is a fundamentally different process than filtration and its a critical component in indirect and direct water reuse. No long r is it necessary to think of drinking waste water as separate entities. They are all water looking to have the desired elements removed to get it to a desired level. Humidiation, dehumidification, closed circuit desalnations, forward aosmosis and a whole bunch of other technologies people continue to develop. Israels Water Supplies have been limited from its creation. Theyve had to learn how to conserve through public education, reducing water losses and appropriate pricing. Because the need was so immediate, a new membrane technology, which was invented and commercialized in the u. S. Would work and decided to move forward without perfect information. They had good knowledge from the experience of others and their own research on how to manage the environmental effects, such as reducing chemical edition. Reducing impitchment of intakes. In discussing this with odet fixler, the Deputy Director general of the israel water authority, he said technology is only technology that already works. The broader work is the cost of water, which crops and who will subsidize. By developing are salination as part of their Water Resources, they were able to develop an industry that can compete internationally. The differences between california and israel. California is much larger than jael. Israel has a population of round 8,000,000 in 8,000,000 square miles. And california is 39,000,000 and 164,000 square miles. Some of the lessons i learned with my colleagues. Invasion should follow a progression related to risk taking and project size. Consistent funding is imperative to have strong initial reviews combined with ability to accept risk when studying the unknown. A Strong Technology transfer must exist to pull invasions into the laboratory for use. It provides the opportunity to involve all parties at an early stage. More detail can be found in my written statement and id be pleased to answer any questions at this time. Sgl thank you all three very much. Let me state that in california, the goal is to reduce the natural chlorides in the red river. Multiple studies dating back many, many years and designs have been completed, many about the core of engineer. Were talking 1978 was one of yet a single project hasnt been constructed in area 6. Now, my question would be to you, mr. Dalton of all these designs, full federal experience have been completed over the last five decades and why is the core asking for yet another study for the project to determine feesability of building projects to reduce the chlorides in the red river . Mr. Chairman, that study that were looking at now for area six, which started outads you mentioned looking at the opening remarks. I think it was around 2005 or so that we looked at it and started recognizing the study. At the time we ran out of money to do that and since that time weve been looking and talking with the state, the county for a nonfederal partner to coshare in that. There have actually been studies. They completed studies. Were talking about a period of over 40 years. How do i go back to oklahoma and ask them to spend more money on a new feesability study. Not a shovel has been in the ground yet. Did you listen to mr. Prices testimony . Is this something, mr. Price that technology is moving in desalination right now and there are krar areas i refer to in southwest oklahoma that might be able to benefit from these . Yes, chlorides can be removed through desalination. If its as simple as that, is it a matter of cost then is this. Its a mat of cost. In the past 30 years, its had a dramatic improvement. Is anything going on right now that we may be over looking in oklahoma . I could discuss it with the core of engineer. Have you kept up with all the technology, mr. Dalton . Im not familiar with exactly what chloride removal were look at for this particular projict. Its something we looked at as part of our other prajects, i believe. What i would like to respond to members of chairman is that we dont know how much is requeered to complete the study, how much more work is required. As far as talking to the nonfederal sponsor or citizens about why they should co chair, we plan on taking advantage of the work thats already been done. Theres been a number of ports of that study that have been completed. And what we need to do now is take a look at what has been done and determine what needs to be done so we can provide you with the work that we think is remaining and the cost and schedule to do that. That would be helpful. And i remind you and everyone else here that next week senator boxer and i planned to start the markup and so we need this stuff now. I want to make sure that anything that can be done and these are the kind of projects were dealing with in this bill. So, we want to stay on top of this thing and id like to be sure and im sure that the core has a lot of research and all that. But make sure that there isnt something looming throughout that would help us resolve this problem. Because right now were getting into the word of bill. And our intengsz is to not let these things side. I think were on schedule. But this is the type of thing that we are wanting to do. Senator boxer. That is music to my ears and i hope we can avoid on either side any kind of poison pill amendments that dont belong there and i think weve shown we can do that. So, do you view desalas a potential component as a co comprehensive water supply . Do you think it shd ould be a component . Is cost a concern . Could federal Water Infrastructure loan programs have helped address some of these cost issues. Senator boxer, the answer is yes to all those questions. Were looking very closely at having that part of our portfolio of sources and we have the santa ana river, which is our free source and the ground water replenishment system and desalination would be the third leg to the stool. Its the most expensive of the sources. But federal loan programs could certainly help with the cost of that. Were fortunate in that there are invasions taking place with brem brainal technology and looking forward to break throughs. Can you explain to us in short what that means in terms of technology. Youre pulling the water molecules across the membrane and i believe lockede martin is developing a we want to push that forward and hopefully drop down the cost of that water. The water we produce and our ground water replenishment system, the nonsubsidized cost is about 850 an acre foot. Whereas the cost of desalinated water is about 1200 an acre foot. So, its about 50 more expensive. And i would just note and i think my colleague agrees. Everybody needs clean water. So, when youre faced with a situation where maybe you have a water emergency, if the cost diminishes because we need it. Its not like we can its the staff of life in so many ways. So, what were trying to do is work with my colleague to get a lot of my water 21 legislature in this and so far its been great. And we want to reenact required development of drought resilient guide lines to help communities deal with drought. That would be helpful. I hope we could support new grant grants for Innovative Technology and change or modify the program to better support Innovative Technologies. Those four things, would you agree, would be a good start for us . Absolutely. One of the bigger challenges we have is the distribution of the water. This will be a new plant at Huntington Beach. And the Distribution System alone e a loan program would be a tremendous help to us. And the chairman and i worked together to get tifia which would allow you to pretty much get interest free loans would that be helpful as well . Interest free, yes. We certainly could use that. Its extremely low interest because its set bases on the chance that you might default spoep, its very low and Orange County has proven to have some trouble. You did a worst situation after the market crashed. How well i remember that and how hard that was. So, let me turn to mr. Price. Do you think the u. S. Should have a greater roll in water supplied technology because you discuss the historic role of the u. S. Government in developing desalination and other treatment technologies but say were not parpisitating in new research as mufrp as we were. That is correct. And one of the wayed i invest gated that was to get oo feel for how the number of scientific publications have changed for probably the last 30 or 40 years. And basically sophia was a pioneer and now 30 years, its an order times 10 times the less in terms of public patience than in the past and i think thats probably due to the federal funding more than anything else. Well, thank you. I dont have any other questions for the panel. I just want to say again this is an area where i think the work of this committee could really spafrm an entire new effort to recountal the new decknologies. I just think a little park from this committee could drive chav and allev yad wup of the billest prop hadded that we made a a naegd. And i know wk oklahoma, wh you think back in history, the problems and california over the years with drought. And this is like buying a really good insurance policy and while were doing it, become a leader in the world in these technologies. So, im excited to work with you mr. Chairman and i think the committee can really light a fire under this desaland and repsycholiresie recyclin recycling. I know theres a simple answer to this. Mr. Price, you have barbara and me, the big ocean there out there and we have the little red river. Is your restefrp 92 tegnology would equally apply to both or focus on one area tats arer a more advanced looming technology or is it the same . The toeknologies remain the same but its a lot less expensive because it takes less energy to remove the dissolved spots. We will submit a question for the record to get more details on how to make chloride control construction a reality in area six were so concerned about. Well, anyway, the timings right. Were get nothing to our bill and thats what this is all about and its been a problem in my quit for a long time. So, i think any other comments that any member of the panel might like the share with us on this committee. We have steph from all the tloefs committee and theyre very interested in this issue. All right, in that case, we are acern journed and thank you very much for your coming. Thank you very much, everybody. Friday, we bring you more from the Republican International Committee Live from florida. It begins 10 30 eastern on cspan 2. Kyle cheney of politico has been following todays rnc rules in california. Thank you for being with us. Great to be here. Thanks for having me. Nothing changed today. Why . Well, theres been a lot of pressure and scrutiny on the prart of the process that is usually very much ignored by campaigns because its such a pro form of exercise in thoes years. This year the rules could play a big part in how youre alive. Theres been a lot of worry thought the they make too many changes, thal they decided to let the whole thing go, pretty much. As you and your colleagues have been reporting over the last couple of days, theres been an all out inturnl struggle and all of this trying to be tamped down by chairman and he obviously succeeded today. What was happening . So, essentially theres a push by some members of the rnc to change the actual rule book and get red of the convention as its currently been run and typically the speaker of the house chaired it and to use roberts rules, they made it much more driven by the delegates themselves. Theyre more trance paernt. It would reorient how the convention was run. So, thats where the struggle has arisen from is entertaining of not understanding. And now hes cosh these rule changes. And about a hamp a dozen members about changing any of these rules. How much pressure is on . I think that pressure is there. Its more of an existential one. I dont think hes saying if you dont change this, its going to be a problem. Theyre aware of the skrautany and perception that there could be this rigging of the system. And the delegates themselves will actually write and change any rules they want to. The rnc is only making recommendations . This is basically punt uddown the read and it will include if the delegates from the republican nathal committee. What puaengsally could we expect snooa lot rfrs going to depe depend on who the delegates are. Ted cruz has had a lot of success. So, you can suspect the rules might reflect changes they want to see, as opposed to anything the rnc might choose, like insuring that only ted cruz and donald trump are able to seek the nomination. Figuring out wads toop limed outside contenders or pressure. How much pressure is the chairman under . An enrms amount of pressure. You know, a lot of izcrawl teelgs are tiling fim a ton of credit. And he had to build up this massive data operation and ground game for the eventually nominee, and donald trump, despite all the hostility between them. So, its a ditch klt puzishz. Maybe the thoes difficult in holly wad today. Not much happened today. All eyes on cleveland. Kyle cheney of politico who is following all of this. His work Available Online at politico. Com. Thank you for being with us. Glad to be here. Thank you. My recommendation is that we focus very much on trying to understand suicide and trying to prevent suicide. So that these things dont erupt into a terrible tragedy. On sunday afternoon at 1 30 eastern, book tv will air back to back programs of this years Pulitzer Prize winners. And this years history recipient recalls general custer in custers trials. Go to book tv. Org for the complete weekend schedule. Next, seniors secured foilshs on what they were doing to protect investors by maintaining fair market. She testifies on Capital Markets. Its two hour and 30 minutes. Morning everyone. Good morning. Our team is here. Going the field alone over here. So, subcommittee on Capital Markets will be here on call to order. Todays hearing is entitled continues oversight of the fcs offices and division divisions. Without ubjekz, members of the Financial Service committee who are not members of this subcommittee may in fact participate in todays hearings. So, todays subcommittee will continue its efforts of vigorous oversight of the fcc and the individual offices that makeup the fcc. Weve heard training from directors of Investment Management divisions that fcc. Theyve allowed us to take a more thorough look, enforcement practices so that we can better understand whether the fcc is appropriately carrying out its threefold mission to maintain fair and orderly markets and last but certainly not least facilitate capital fornlatimati. I look forward to testimony and hope between the four of you here on the panel that we are able to cover a lot of ground in the time we have. If you go back in the year 2000, the fccs operating budget was about 369 million. Today, its a little over 1. 6 billion. The fcc has recently submitted requests for the budget coming up of 1. 8 billion. So, during much of the time when congress has been accused of starving congress, its budget has actually quadrupled and done so in a little less than a dozen years. And funding co insided with an agency that has become four times more effective. Instead were likely to see this time as the fcc was ill prepared for the financial crisis of 2008. And when it failed to properly incorporate Economic Analysis into its rule making and often times been complicit in advancing the priorities of special interests. So, instead of asking some of the fundamental issues, the daud frank act has created more offices within agencies. Two of which are here with us today. And what the fcc has made strides towards improving the Economic Analysis, theres still much more work to be done. Its not acceptable to say congress made be do it. Raise your rule last year and its up to the fcc to clearly articulate a problem which the rules are intended to possespos which is obvious. So, im eager to hear about the depths the fcc is taking to improve its Economic Analysis and continue over credit agencies. Broad agreements that certain provisions under dod frank such as regulations were much needed and addressed one of the causes of financial crisis. And i worry that many of the micromanaging rules have had the effect of further stifling in the Credit Agency. Ill yield to the Ranking Member for five minutes. Good morning and thank you so much, mr. Chairman for holding this important meeting and all our participants today, this meeting will continue, a series of oversight meetings in the fcc. The office of compliance, inspections examinations, the office of whistleblower and the division of economic risk and analysis. All four of these offices play a Critical Role in policing our nations securities markets. The office of Credit Ratings over sees, moodies, f c and fit. And it revealed the catastrophic effects when they all get their ratings wrong. And dod frank created Credit Ratings, is to insure that inappropriate conflict of interest at the rating agencies do not influence the ratings if the firms assigned to different securities. The office thoof the whistleblo was also created by dod frank and intended to help whistle blowers to come forward with timely information about wrong doing. And for tips saving over a million dollars, it incent vises employees to blow the whistle before they get too large and too devastating. In fact, in 2015, the office received over 4,000 tips from whistle blowers. The division of economic risk and analysis is the data arm of the fcc. It supports all of the other it visions by conducting cost benefit ainalsis, of potential rule makings. And even calculating the inappropriate punishment or rather the appropriate p punishment for bad actors. And finally ocie is one of the largest and most underfunded. Offices in the fcc, it has over 1,000 employees who examine registered Investment Advisors, broker dealers, exchanges, mutual funds and mutual advisors. This sounds like a lot of examiners but it pales in comparison to the number of market participants. Over 12,000 Investment Advisors, 11,000 mutual funds, 800 Municipal Advisors and 18 securities exchanges. As a result the commission is only able to examine about 10 of alltment advisors have never been examined. And in 2015, a whopping 77 of the commissions examinations identified deficiencies at investment investmented a visors. And 11 were referals. And that means of the 5,000 Investment Advisors who have never been examined, a little over foyer,000 have deficiencies that have not been uncovered. This is a scary thought for investered who relyong thesed a add visors to manage their savings. I look fortwoord your team. Thank you for your work. Thank you. Thank you very much. The gentleman from virginia, the vice chairman of the committee for two mines. Thank you, mr. Chairman. Irupt virginias fifth district. I regularly hear from my c constinchent withes. And it makes it more difficult for our main street and Small Businesses to Access Capital and be successful. While theyve been olaser focussed on easing the access to capital and builden the bipartisan success and then were leading over executive branch agencieagencies. I do am concerned that the fcc often dev yates its threepart missions too, protect investors and to facilitate capital formation. This allows congress to rick go over fulfilling its threepart mission. Look forward to the testimony of our witnesses and thank the chairman for returning this. Great, so the gentleman yields back and welcome to matters of the panel before us. Your full statement will be part of the rukered. In front of you youll be recognized for five minutes and in frupt of you are the lights which are green, yellow, red. Yellow light should come on when you had one minute remaining. So, we ask you have to begin to light up and thats our cue. And with that mr. Butler, you are ruk ugunderets for five plints. Thank you for inviting me to testify regarding the office of credit records. It protect investors, maintain fair and orderly markets and facilitate capital formation. It does this by over seeing credit agencies that have been nationally recognized. In 2006, the Credit Agency Gave Congress authority to implement a perier myriad of rules. And then the office of Credit Ratings dedicated to the oversight of rose. And first, examinations, next nrso monitoring and third, policy and rule making. Those questions arose for Commission Rules accounts for the majority of the office activities. The scope of the annual examinations cover s 8 required review areas. And theyre risk bested approach this improved the eficialancy and theyre priortiesed and focussed on higher risk. The office conducts sweeps to address credit market ixus and concerns. The nrso has been many have implemented fundmental changes. Adding staff to tum plients and over spite stooit sungs pm and inhnsing disclosure, transz parents and governorance. Rehens of requirements. All of which became effective by june 2015. As required by the dod frank act, office sums are rises the findings. The nrso monitoring gather, analyze and aseds dadau and identify trends across the agency. And they have period. Importantly information obtain booded b Monitoring Group for guiding any future rule makings. The rule making group within the office is responsible for conducting studies, drafting reports and including those required by the Credit Rating Agency Reform act and the dod frank act. New rules adopted by the commission address among other things reporting on internal controls, conflicts of interest, include an absolute prohibition. Procedures to protect the rating methodologies. And standards of training, experience and competence were cretted to analysts. Rules also survive as to the effectiveness of internal controls. But no part of the Credit Rating was influntszed by any other businessactivity. While the commission has Broad Authority to address all books and records and to impose sanctions for violating statutory provisions, the commission is not permitted to regulate the substance of Credit Ratings and methodologies used to determine Credit Ratings. Thank you for having me. Welcome to the panel and you are recognized for five minutes. Make sure you always push your button on and off. Thanks. Thank you. Good morning chairman gared and members of the subcommittee, itser my pleasure to talk to him about the recent faevs of isk analysis. Dear supports the commissionss through data driven high quality Economic Analysis. We have grown from approximately 96 employees in 2013 to a projected work force of 175 by the end of the fiscal year. By that time we anticipate employing 88 ph. D. S and we even have two ph. D. Physicists. Theyll be supported by 22 Research Associates by the ownedf towneend of the year and an diverse staff of technical experts. The depth in exper seeds has allowed him tox pand his supported. Our most well known function and you examine, analyze the potential economic effects of the proposed and final rules and evaluate Public Comments on those rules. We provide theoretical and data driven changes to policies. We look closely at staff, from the earliest stages to the final development. In the course of assisting can other divisions and offices. White papers and other domuments with specific policy issues or rule mageings. Last year they produced white papers for open ended mutual funds operation. Theres volunteer clearing activity. And another paper on the market for unregistered security offerings. In asepsh to research with your rules. Do they regularly post those and theyre posted on the dearau web page to rovide people access to our Current Research on financial ma financial markets. And we provide financial and risk modeling expertise to other divisions and offices. Our Data Analysis helps sec staff with scoping including providing guidance on which intutees to exam. And what to look forbp one is urtool developed in close collaboration with ob staff. It identifies anonilous behavior and might indelude risk, work force or structure. We also had a Risk Assessment tool. Developed in the convention of something elts. It allows the attorneys that hopes them to assess my Financial Reporting irregators. And they provided expert assist since in over 200 ma h00 matter. They calculated ill gotten gains and evaluate economic bast claps pch he prepare to creage or critique the challenge. And in recent instances, they have actually testified on behalf of the commission. None of this work can be done without high quality data. The oversight fallinize to two deskring and unrelated categories. Vera supports the data usage by designing validation rules, data desimination tools to assimulate high quality data. We routinely gen rate statistics given to staff. And i believe deer staff are delivering high quality ainalicize and we loortk forwar to the futurer. Thank you. Good morning and welcome to the panel. Morning, chairman garret, Ranking Member maloney and members of the subcommittee. Thank you for having me testify regarding the pebltsis sof the pleeler. Its a separate office with five legal assistants and an administrative assistant. All of whom are taszed to the whistle blow program. It was dejiened to provide the commission and the specific testimony toly credible information. Enhancing the communitys unlt to help those from horm. And anybodies who voluntarily provietd the n. Asz that results in monetary sanctions exeding 1 million. May receive a portion we continue to receive a significant number of award claims, including over 120 in fiscal year 2015 alone. As of the year of the year, preliminary detep ethe kmeg commission against individuals and companies totalling over 400 million in sanctions. Ordered to by paid to investors. The amounts ordered to be returned to harmed investors have not been effected in any way. Thanks in prart to the positive astrangd of the show squch the nop of reports have increased each year. 30 increase over the number received in fiscal year 2012. Since the programs inception, we haveeceived more than 16,000 tips in every state of the country, including the District Of Columbia and fum 95 countries in the u. S. Ourall saufs was helping to insure that the clothes come pak. Without fear of retal yath. In 20 sfraen, they praut their fir sending a strong message that its unacceptable. We have expressed the view that it extends tothose that report internally, regardless of whether they separately reported the information to the commission. We continue to assist to present a comp ens from possible wrong doing in the commission. And he brought his first action against cris msh frees. Rule f 17a limits any action to impede an individual about reporting a possible violation from the collection. And report Securities Violations continue to be our top priorss. You have demonstrated that we can and whil take action who retaliate again or interfere idea with the ability. It was information that leads to successful enforcement actions. Give an strong track record. We expect to continue to receive high quality tips to halt fraud earlier and more efficiently. We fully effect it will be a game changer to protect investors and insure the efficiency of the market place. Thank you again for the invuivation. Finally, last but not least, mr. Watt, you have five minutes. Members of the subcommittee, thank you for the opportunity to discuss my house. Oc, through our National Examination progreez advances the mission through things that inform quality. With the staff of over 1,000 employ es oop she has registration responsibility. 11,000 mutual funds and atfs. More than 400 transfer agents. Over 650 registered municipaled a visors. And you have 18 National Securities exskmeempss. Then the pcaob. Recent legislative changes such as the dod frank act and jobs acts have expanded the responsibility to include swap market participants, including dealers, repositories and execution facilities. As well as cried fouthing portals. We continue to see the complexity of market participants. In order to maximize our use, were in the process of increasing coverage to advisors. To meet the challenge imposed, weve adopted a riskbased frame work for examinations and we prow mote wcompliant through transparency. We have debusiness practices or activities which may harm investors. We external or emd ternl data sources. This if ainse allowing areas reviewed in a past we increased our use of Data Analytics to further refine our riskbased program. And oc developed a new tool, need. That enabled examiners to lan lace a yares worth of trading datau. Our and there are techniques that areas of mun alaundering and High Frequency training. They will further enhance and expand our capabilities to monitor fraud and mrisk. Through this process we provide restaurants the opportunity to self assess and meet the noncompliant behavior on their own. For instngs, we have to inform the area the staff believes went to frisk. As out loind in our resant priorities. We are in 2015, they launched the retire initiative. Focusing on breekerred dealers and the services they offer to investered with retirement accounts. Retailer investors are charge would a complex and evaurvling set of risk factors when making critical decisions. Another priority is Cyber Security. Over the last two years we have conducted examination to assess Cyber Security preparedness among brokered dealers and inhad vestment advisors. As another example, prior to initianisinitiating these exams published a summary of our observations. And were continuing to conduct cyber administrations. The final priority i will mention is lickidity. Ocs examining advisors to mutual funds, etfs and private funds. These examinations include a various controls. Trading activity and eval yaugds policies. Thank you for testifying today and i will be happy to answer any questions. Thank you for your testimony, thank you for members of the panel. Ill begin over here. So, one of areas there was bipartisan support was regard to removal of references to Credit Rating agencies 939 a. And chairman frnk at the time had the chaps to get include said. And remove rest runts in our throughout. And the purpose of putting that into dod frank was to say that Investment Decisions should not be what they had been prior to that. Simply relying on credit reting agencies. And weve seen that some tension funds are still including them. Some are still specifically including the names of two of the large agencies in our their investmentide hines. And in 30 seconds can you say as far as the contention. You speak with are eguards to federal statues and the, the cc hasnt worked. And the offices and divisions completed the work there. P so, all impages have been removed by federal statute. I recognize there are certain Pension Funds suing to the larger Credit Rating agency saying their opinions in the past were piledly invanurate but theyre still using them for their increstment guide lines. Which seems counterintuitive. Im aware that there are Pension Funds that recall credit raethz, by name or by reference to the big three. And is that a problem . I wouldnt character ice it as a problem. I would say we werent able to do more is there something more that should be done. Is it can be or should be directed to . It was not in the ambet of the Credit Ratings overseas. That was the division of investment man. Ment. With revard to the Credit Ratings, were comfortable. I got that. With regards to the Credit Ratings, were comfortable with the authority we have, beyond that i wouldnt want to compliment. Mr. Flanry, when it comes to certain issues, regulations be. Economic pen if the asnsicize is corrected boo ithe ansancy, correct. Yes. When you tame to the issue of the pay rule, that was done. Yes. And in that analysis, is it true that they couldnt benefit . Yes, i think thats right. Ultimately the justification was tied to informing investors about the possible as visibility of their stay on pay votes. But at the thoechd day, they could not quantify and a lot of what we do is very difficult to quantify. And so in the Decision Making proces process, why was this one done . When you could have quantified . Deer respond to the rules as they come up, we try to explain and clarify to them what the economic facets of the decision are and then they are free to weigh those benefits and costs against the other considerations. Is it fair to say this was done bah of a man date as opposed to the scc . Yes, sir. And its a shell situation as opposed to a may situation. And within a whole gambit of things the scc could be working on, there were other areas you could quantify a benefit, correct . Well probably do more quantification in that case, yes. So is there a reason you see areas you can and they go ahead and do so . We are, in many ways, a reactive division in a sense that were asked to weigh in on a rule to be considered. Make recommendations at the end of your report . About the order of consideration . Yes. No, i dont. Of course, my time is already up. Lady from new york, youre up. Mr. Flanry, im a big fan of structured data, especially the use of xbrl. It certainly makes it easier for investors to locate good investments, diamonds in the rough and easier for start ups and new businesses to let investors know that even when you and you deskicribed as a hub. And can you explain why structured data is useful for the investor and to the sec and exactly where does the implementation stand now with the scc . Yes. We have an office of structured disclosure inside of dera and the purpose is to advise where and what and how data should be structured. So, when theres a new rule, these books eval ute what can bead captured. And a good example of what that does for us is we now publish on our website quarterly financial