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[Senate Hearing 114-553]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 114-553

    HOW SMALL BUSINESSES ARE SUPPORTING AMERICA'S ENERGY RENAISSANCE

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

                                 HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                          AND ENTREPRENEURSHIP
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 23, 2015

                               __________

    Printed for the Committee on Small Business and Entrepreneurship
    
    
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]    

         Available via the World Wide Web: http://www.fdsys.gov
         
         
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                       U.S. GOVERNMENT PUBLISING OFFICE
22-201 PDF                     WASHINGTON : 2017                       
           
_________________________________________________________________________________________
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           COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP

                    ONE HUNDRED FOURTEENTH CONGRESS

                              ----------                              
                   DAVID VITTER, Louisiana, Chairman
              BENJAMIN L. CARDIN, Maryland, Ranking Member
JAMES E. RISCH, Idaho                MARIA CANTWELL, Washington
MARCO RUBIO, Florida                 JEANNE SHAHEEN, New Hampshire
RAND PAUL, Kentucky                  HEIDI HEITKAMP, North Dakota
TIM SCOTT, South Carolina            EDWARD J. MARKEY, Massachusetts
DEB FISCHER, Nebraska                CORY A. BOOKER, New Jersey
CORY GARDNER, Colorado               CHRISTOPHER A. COONS, Delaware
JONI ERNST, Iowa                     MAZIE K. HIRONO, Hawaii
KELLY AYOTTE, New Hampshire          GARY C. PETERS, Michigan
MICHAEL B. ENZI, Wyoming
                  Zak Baig, Republican Staff Director
                 Ann Jacobs, Democratic Staff Director
                            
                            
                            
                            C O N T E N T S

                              ----------                              

                           Opening Statements

                                                                   Page

Vitter, Hon. David, Chairman, and a U.S. Senator from Louisiana..     1
Boustany, Charles W., a U.S. Representative from Louisiana.......     2

                               Witnesses

Harder, Dr. Natalie J., Chancellor, South Louisiana Community 
  College........................................................    12
Pellerin, Joshua A., President & CEO, Pellerin Energy Group LLC..    17
Fenstermaker, Bill, Chairman & CEO, Fenstermaker and Associates..    22

          Alphabetical Listing and Appendix Material Submitted

Boustany, Charles W.
    Testimony....................................................     2
Fenstermaker, Bill
    Testimony....................................................    22
    Prepared statement...........................................    24
Harder, Dr. Natalie J.
    Testimony....................................................    12
    Prepared statement...........................................    15
Pellerin, Joshua A.
    Testimony....................................................    17
    Prepared statement...........................................    19
Vitter, Hon. David
    Opening statement............................................     1
    Prepared statement...........................................    32

 
    HOW SMALL BUSINESSES ARE SUPPORTING AMERICA'S ENERGY RENAISSANCE

                              ----------                              

                         MONDAY, MARCH 23, 2015

                      United States Senate,
                        Committee on Small Business
                                      and Entrepreneurship,
                                                     Lafayette, LA.
    The Committee met, pursuant to notice, at 8:31 a.m., in 
Lafayette City Hall, 705 W. University Avenue, Hon. David 
Vitter, Chairman of the Committee, presiding.
    Present: Senator Vitter.
    Also Present: Representative Boustany.

 OPENING STATEMENT OF HON. DAVID VITTER, CHAIRMAN, AND A U.S. 
                     SENATOR FROM LOUISIANA

    Chairman Vitter. Welcome to everybody, and thanks for being 
here.
    Why don't we all get started in the right frame of mind and 
the right frame of heart by standing for a prayer, and please 
remain standing for the Pledge of Allegiance to the flag right 
after the prayer.
    But first we'll be led in prayer by Pastor Steve Stone with 
First Baptist Church.
    Pastor.
    Pastor Stone. Let us pray. Father, we begin this Monday 
morning, the beginning of the new week, with renewed hope and 
faith and trust. It's not always easy to come by, so we rely on 
Your strength for that. We are reminded of the words of the 
psalmist, ``From whist cometh our help,'' and the echoing 
reply, ``Our help comes from the Lord.'' Be ever mindful of 
that today.
    We would be prayerful today for many things, but today we 
petition You for freedom. We pray for the release of those who 
have been unfairly and unjustly imprisoned because of their 
faith in Almighty God. We pray that justice would flow in these 
matters.
    For the purposes that bring us here today, we pray that You 
would give us wisdom and insight into the matters that are 
talked about today.
    We are always mindful of our folks in the military, men and 
women who have left their spouses and children and parents and 
serve us, and we've been recently reminded that they're not 
always in danger in a foreign land but in training here in 
these United States. Watch over them.
    Ultimately we pray, oh God, for Your will to be done on 
Earth even as it is in heaven. Amen.
    Chairman Vitter. Amen.
    Thank you, and remain standing for the Pledge of Allegiance 
to the flag. We will be led in the Pledge by our Police Chief 
here in Lafayette, Jim Craft.
    Chief.
    [Pledge of Allegiance.]
    Thank you, Chief.
    Please be seated.
    I also want to recognize Dee Stanley, the Chief 
Administrative Officer of the City of Parish, and Chad Sonnier 
with the Lafayette Fire Department.
    [Applause.]
    Welcome again. This is sort of a combination town hall 
meeting and field hearing of the Senate Committee on Small 
Business and Entrepreneurship, and our main topic today is how 
small businesses are supporting America's energy renaissance.
    I am really so happy to be joined by our congressman here, 
Congressman Charles Boustany, for this important town hall and 
field hearing.
    Let me go over exactly how this is going to work, and then 
I'll throw it over to Charles for some opening comments.
    So after our initial opening comments--and I'll have some 
after Charles about the topic that our witnesses are going to 
speak on, small businesses' role in the energy industry and 
growing the energy economy--after those opening statements, 
we'll go to your comments and questions. And if you haven't 
already, we're passing out a form.
    Where is my staff?
    We're passing out a form. If you haven't already, jot down 
your comment or question, your topic, and hand it over to us, 
and we'll try to get through as many comments and questions as 
possible. Hopefully, most of them are on topic. We want to 
mostly talk about the energy economy, growing energy jobs as a 
part of our economic growth in general in Louisiana, but we'll 
certainly take other topics as well.
    Then, after about 30 to 40 minutes of that, we'll introduce 
our key panelists today. We have three great witnesses who know 
a lot about the energy economy and the tie-in with small 
business. They will each present testimony of about 5 minutes, 
and then following their testimony Charles and I will question 
them and have a discussion with them on the topic. So that's 
how this morning will proceed.
    Charles, do you have any opening thoughts?

 STATEMENT OF REPRESENTATIVE CHARLES W. BOUSTANY, JR., A U.S. 
                 REPRESENTATIVE FROM LOUISIANA

    Representative Boustany. Well, thank you, David. Thanks for 
your leadership of the Small Business Committee in the Senate, 
the committee that deals with small business and 
entrepreneurship, something we know a lot about in Louisiana 
given that our state has led, especially in the energy sector. 
I think this is just a very valuable forum for the two of us to 
hear from all of you directly, but also to hear from some very 
important witnesses, the panelists here who know what's going 
on from a Louisiana perspective.
    So I'm just truly honored to be here with you, to share the 
stage with you, and to try to answer questions.
    Chairman Vitter. Right. Thanks, Charles.
    Let me make a few opening comments about our topic.
    Chairman Vitter. I became chair of the Senate Committee on 
Small Business and Entrepreneurship in January. So the first 
thing I wanted to do was really bring the committee and our 
committee activities to the real world, including Louisiana. So 
that's why we're having a committee event here in Louisiana. 
It's certainly not going to be our only one, as well.
    Again, today's discussion is focusing on the changes going 
on particularly in this part of the state and to the west of 
here as a result of capital investments in the region, 
particularly in our energy economy, and how we can take up that 
opportunity to grow jobs through small business.
    The first slide up here shows that throughout the abysmal 
economic recovery nationally--and that's been held back by a 
lot of Federal policies--our domestic energy industry has 
actually continued to create jobs and new revenues, the 
majority of which can actually be attributed to small firms and 
contractors. So small business is at the heart of this economic 
renaissance.
    This next slide shows that it's estimated that nearly 1 
million Americans work directly in the oil and gas industry, 
with about 10 million jobs associated more broadly with that 
industry.
    Now, in order to better coordinate the efforts that allow 
small businesses to support our energy industry, I think it's 
imperative that there is an open line of communication between 
these regional business leaders and folks at the Federal level.
    Slide 3 shows that Louisiana will receive roughly $80 
billion in new and expanding development over the next few 
years. These are some of the Louisiana projects on tap just in 
this part of the state and to the west of here. Just in this 
part of the state and to the west, it totals $63 billion. 
Statewide, it totals over $80 billion.
    But the economic growth in this region is not without its 
own set of challenges. At the current rate, Louisiana can't 
meet our workforce development needs, our needs to train up 
skilled workers. So that's a real problem, and the next slide 
goes to that point.
    So right now, unfortunately, our jobs are outpacing 
training. That's sort of a good problem to have, but it's still 
a challenge, it's still a problem. So we need to meet those 
workforce development needs.
    Beyond those challenges are regulatory challenges, and 
that's usually being put on the state by the Federal Government 
by over-regulation at the Federal level, and this is a direct 
result of President Obama's leadership and over-regulation 
through Federal agencies like the EPA.
    What businesses need to thrive is a strong but restrained 
regulatory system that doesn't impede their growth. A 2010 
Small Business Administration study found that Federal 
regulations cost American businesses $1.75 trillion annually, 
and that clearly adversely affects small businesses, and the 
smaller they are, the more that regulatory burden is. So we 
need to ensure that our regulatory environment doesn't 
interfere with this important part of our economy.
    So those are some of the things that we're going to be 
talking about today.
    With that, let's get to your comments and questions, as I 
promised, and we'll have sort of the town hall meeting portion 
of this morning's portion of our discussion, and then in a 
little bit I'll introduce our witnesses.
    Let's start with your comments and questions. If you 
haven't already, if you need a form to fill out, just raise 
your hand. We'll get those to you, and just pass them up to me.
    When I come to you, if you could stand up so we can have a 
good discussion.
    Leland Jans--where is Leland?--asking about Common Core. 
Why don't you elaborate, sir?
    Mr. Jans. Well, I really don't know much about Common Core, 
and I don't understand what all the fuss is. The governor was 
going to start supporting it. Now he doesn't support it. What 
all are the questions about Common Core?
    Chairman Vitter. Yes. Well, that's a big topic. I'm running 
for governor now, so I'll take that since it's a state-based 
issue.
    You know, I think there are several different concerns with 
Common Core. One of my top concerns is that it really cedes 
state control and authority to national elites and, to some 
extent, to the Federal Government, and I'm completely opposed 
to that.
    I strongly support rigor, standards, and accountability. We 
absolutely need all of that in public education. But I think we 
need that in a Louisiana-based system.
    So in running for governor, what I've said is that I would 
lead us out of Common Core but in a strong, rigorous, 
demanding, Louisiana-based system that doesn't cede that 
control and authority to either national elites or the Federal 
Government.
    Mr. Jans. I don't know about the control part, but doesn't 
that put everybody on the same educational basis?
    Chairman Vitter. You're talking about what? Doesn't what 
put us----
    Mr. Jans. Doesn't Common Core put us on the same track 
here?
    Chairman Vitter. Well, that's certainly one of the 
arguments in favor of it, okay? This way you can compare your 
students with those around the country. That is useful to do, 
and we can still do that with choosing the right testing.
    First of all, Common Core is not universal to 50 states, 
and the Common Core standardized tests are not universal to 50 
states. In fact, there will be far more students nationally who 
aren't under those particular standardized tests than who are. 
So I still think we can get an objective benchmark about how 
we're doing compared to other students around the country by 
choosing a standardized test, but it doesn't have to be within 
the Common Core framework. But undoubtedly, the testing we'll 
choose is going to be used in at least a handful of other 
states.
    Mr. Jans. I believe that the people that opt out 
[inaudible] of Common Core, right?
    Chairman Vitter. Correct.
    Mr. Jans. And if people are able to opt out, I don't 
understand why [inaudible].
    Chairman Vitter. Right. Well, I mean, that's a controversy 
going on now. I mean, they basically opt out by just not going 
to school that day, and the big question is whether that's 
going to be counted as a zero in the grading school systems or 
not.
    Thank you.
    Mike Thibodeaux? Where is Mike?
    Mr. Thibodeaux. I'm Mike Thibodeaux.
    Chairman Vitter. Yes, sir. You're talking about draft 
reports and studies paid for with public monies and right to 
know. Why don't you elaborate? I'm not sure exactly what you're 
asking about.
    Mr. Thibodeaux. Public studies are done that the public 
pays for, the information [inaudible].
    Chairman Vitter. Absolutely.
    Mr. Thibodeaux. We have a right to know.
    Chairman Vitter. Absolutely.
    Mr. Thibodeaux. We have a right to see what did this person 
do. My particular complaint is that the study in particular 
[inaudible] that say that the Federal tax credit that you get 
for all energy producers [inaudible], but it's not. It's a 
reduction. So if you're going to skew that 30 percent Federal 
tax credit so it's an expense, then your whole study is wrong.
    So what I want to know is can you have it? When you ask for 
it, they say it's proprietary. How can you have proprietary 
information if [inaudible]?
    Chairman Vitter. Yes, I thought that study was public, but 
I'll be happy to look into that. Certainly, if public funds are 
used, the result of the use of those public funds should be 
public.
    Charles, do you have anything?
    Representative Boustany. I agree with that, and I also 
agree that if public funds are used, all conflicts of interest 
need to be put on the table in a very transparent way so people 
know affiliations of those who are doing these studies.
    So, yes, absolutely. My understanding is that most of the 
time when there are Federal funds going for something like 
this, there are requirements for it to be very, very open and 
transparent. I don't know the particulars in this case with 
that particular institute, but I'd be happy to look into it as 
well.
    Chairman Vitter. Mike, before you leave, if you could give 
me and my staff your contact information and the name of the 
report you're focused on, we'll specifically look into that and 
try to get a copy. But certainly, I agree with your premise.
    Mr. Thibodeaux. I have a copy, and I read it.
    Chairman Vitter. Okay.
    Mr. Thibodeaux. And when I read it, that's where I saw that 
the 30 percent Federal tax credit and the reduction is used as 
a [inaudible]. It's not a [inaudible]. It's a reduction of 
cost.
    Chairman Vitter. Right. Well----
    Mr. Thibodeaux. So the whole report basis is skewed.
    Chairman Vitter. Yes. I didn't read the report. I'm not 
sure exactly what you're referring to. What they're probably 
calling it is an expenditure of tax dollars--in other words, 
foregoing revenue that the government would otherwise get. So 
they're probably putting it in that category of foregoing 
revenue. But I'll be happy to look at that and maybe be better 
able to respond.
    Mr. Thibodeaux. Thank you.
    Chairman Vitter. Okay.
    Tony Depa? Where is Tony?
    Mr. Depa. Yes, sir.
    Chairman Vitter. Asking about our thoughts on the 
Affordable Care Act?
    Mr. Depa. Yes, sir.
    Chairman Vitter. Okay.
    Mr. Depa. Nice to see you, Congressman Boustany.
    Tony Depa from Lafayette. Again, just full disclosure, the 
Congressman [inaudible.]
    I worked for the President's reelection campaign in 2012, 
so I went to battle in four battleground states for about six 
or seven months for this Administration's platform, most 
importantly or one of my big ones is the Affordable Care Act.
    Obviously, we know that there's something that we hear in 
Louisiana called the Gender Gap. So I guess the question to 
both of you, if you wouldn't mind commenting, is just what do 
you think? I mean, it's been the law for five years. It's very 
well documented how Republicans in Congress have tried to shut 
it down. So you can comment on that or where you see it going 
in the future.
    Chairman Vitter. Yes. Well, full disclosure. For me, I 
worked against the President's re-election very hard in 2012.
    [Applause.]
    And I strongly opposed ObamaCare, and I still strongly 
oppose it because I think it's creating more problems than it's 
solving. I think it's made cost increases, which were a big, 
big problem with the American health care system. I think it's 
making those worse, actually, versus better.
    Mr. Depa. There are probably people in this room that don't 
know the difference between ObamaCare and the Affordable Care 
Act.
    Chairman Vitter. Well, there is no difference. I'm 
referring to the same thing.
    Mr. Depa. A lot of people don't know that.
    Chairman Vitter. Yes. Well, I mean, the Affordable Care Act 
is the----
    Mr. Depa. I'm here to educate as well.
    Chairman Vitter. The Affordable Care Act is the Washington 
term. I don't use it because I think it's an Alice in 
Wonderland term, and it's not affordable, it's pushing costs 
up. So I prefer to call it ObamaCare.
    I think we need an alternative to that, and I've supported 
specific alternatives, targeted reforms that would go after not 
re-making 20 percent of our economy from start to finish but go 
after specific reforms to make health care more affordable, and 
I'd be happy to talk about----
    Mr. Depa. Does that include repealing it or not?
    Chairman Vitter. Yes. I voted several times to repeal it, 
and I'm still working to repeal it.
    Mr. Depa. It works.
    Chairman Vitter. Charles.
    Representative Boustany. I spent 30 years with health care, 
and so when this debate was raging back in 2009 and 2010, I was 
in the middle of it. I warned our colleagues on the other side 
of the aisle, the Democratic side of the aisle, that what they 
were proposing was going to run up costs, restrict options 
within the insurance arena by forcing consolidation, and it was 
going to wreak havoc on the provider side, and we're seeing a 
lot of that now.
    The trend lines are not good. We're driving individual 
physicians out of private practice because their cost structure 
is unsustainable. We're forcing hospital consolidation and 
potential closures in rural hospitals. We have a situation now 
where you've seen consolidation and fewer choices among 
insurance companies, a more monopolistic type of behavior, and 
this is problematic.
    Costs are going up. I've traveled around our district and 
I've run into small business owners who saw a 40 percent hike, 
40 percent hike in their premiums over and above last year. 
This is problematic.
    We can do better, and I fought alongside David against this 
because I saw the trends that were going to come out of it.
    So we'll see what happens going forward. I think that the 
Supreme Court case may, in fact--it's called King v. Burwell. 
Remember that. You'll hear a lot about it as it comes up. That 
may be the undoing of some of these faulty foundations that 
we've seen with ObamaCare.
    Chairman Vitter. Just two more comments. I want to 
underscore what Charles said. There is a major Supreme Court 
case that should be decided in June. That will have a lot to do 
with how we move forward as a country.
    Secondly, I'm sure Charles and I agree with every 
Republican that we work with, that we do need reforms. The old 
health care system wasn't perfect. It had a lot of problems and 
issues. We believe in targeted reforms, things that go after 
the real issues, like there is certainly an issue of folks with 
preexisting conditions. We need to fix that. There is certainly 
a cost issue. So how do we make it more affordable?
    So we're in favor of several targeted reforms that would go 
after those very specific issues rather than sort of a very, 
very broad, 2,800-page bill.
    Mr. Depa. I appreciate that.
    One more thing, and then I'll stop talking.
    You were talking about costs, how much it costs. Not once 
have either of you talked about, well, do single mothers 
deserve health care. Do the poor people in Lafayette and in the 
State, do they deserve health care. So you guys are sitting 
there telling me how much everything is going to cost, but you 
all don't seem to give two rats about the poor people in our 
State. That's what I'm hearing. I know that the people who are 
here aren't hearing that, but that's what I'm hearing, that it 
costs this, it costs this, the President sucks, and you guys--
again, I know I disagree fundamentally with pretty much 
everyone in this room, but still I'm trying. The Congressman 
told me I need to try to reach across the aisle. That's what 
I'm trying to do. I'm here this morning.
    Representative Boustany. If you look back at many of the 
speeches and comments I've made publicly, I've always talked 
about how important it is to preserve the doctor-patient 
relationship, make a doctor-patient relationship for every 
single American that's affordable and meets a high quality of 
care, including single mothers and those who cannot afford 
insurance today.
    The Republican side of the aisle coming out of the Ways and 
Means Committee, where I serve, we were only given 15 minutes 
total to debate an alternative back in 2009-2010, that 
timeframe, when we went to the House floor. I was given 45 
seconds to describe our plan. That's why you didn't hear about 
it, but I'll tell you what it did.
    It actually, according to the Congressional Budget Office, 
lowered premium costs so that everybody could afford it, and it 
created pathways for single mothers and those who currently 
cannot afford insurance or have preexisting conditions. We set 
all of that up, and the Congressional Budget Office said that, 
in contrast to the Affordable Care Act or ObamaCare, ours would 
actually bring down costs.
    Now, you didn't hear about it because we had 15 minutes of 
debate and, of course, we had to fight the bully pulpit. We 
have ideas. We have solutions to address exactly your concerns.
    Chairman Vitter. And just a final thought. The reason I do 
focus a lot on cost is I think that's the biggest reason for 
lack of access. And if costs continue to skyrocket, guess what? 
More and more Americans will not have adequate access.
    So I think it's indicative, quite frankly, of where you're 
coming from, where the President is coming from, to throw cost 
out the window like it's some irrelevant factor. That's at the 
heart of our access problem, and if we don't make health care 
more affordable, it's not going to be more available. If the 
cost curve keeps going up like that, it means there is going to 
be a big access problem for those with that problem now and for 
an increasing number of folks who previously could afford 
something and now can't. So it's directly related to access is 
what I would say.
    Mr. Depa. It's kind of relying on saying you believe that 
we should take care of everyone in our country or you believe 
that I take care of my family and friends and everyone else is 
kind of on their own. I mean, I feel like that's----
    Chairman Vitter. I don't know anybody who feels the latter 
way, but I do tell you how I feel with regard to health care 
reform. I think the first rule of health care reform is if you 
think health care is expensive now, just wait until it's free, 
and that's sort of the experiment we're operating under, and 
costs and expense are going through the roof as a result, and 
access is not significantly improving.
    Let's go to Dorothy Knight. Where is Dorothy? Asking about 
developing a world-class workforce through job training and the 
community college system. Why don't you elaborate, Dorothy?
    Ms. Knight. Sure. I was just reading your little flyer 
here, and you've pointed out that you want to--``It's vital we 
develop a world-class workforce to fill those good-paying jobs 
in Louisiana [inaudible].''
    I happen to be involved with the local community college 
[inaudible], and currently we're moving away from the blue-
collar type of job training, [inaudible] welding, for other 
types of hands-on [inaudible], and they're moving into what I 
would consider--nursing is good, but secretarial or business or 
that sort of thing. It's not going to fill the needs that our 
State is going to have [inaudible], and I just wondered what 
you were doing about it. That's one issue.
    The other issue is that we want Louisiana citizens 
[inaudible]. How are you going to address immigration issues? I 
don't expect you to address all the issues [inaudible], but 
certainly Louisiana expects you to do something to protect its 
citizens and giving them the opportunity.
    Chairman Vitter. Absolutely. Well, in terms of the tech 
system, I think that has to be absolutely at the center of 
preparing our young people for good-paying jobs that are coming 
our way. So the first thing we need to do is make sure they are 
offering courses and training based on the jobs that are here 
and that need to be filled. There shouldn't be a gap. But those 
course decisions shouldn't be made in some ivory tower. They 
should be made by constantly consulting industry and business 
and seeing what's here and what folks need people trained up 
in.
    In this part of the State and to the west of here, that's 
in a lot of skills related to petrochemical and oil and gas. So 
that needs to be front and center in terms of our vo-tech 
system, particularly in this part of the State.
    A second big component I would focus on is reintroducing 
some element of that sort of skills training in K-12, 
particularly high school, to make sure high school students 
understand the opportunities, the great opportunities available 
to them if they have the right skill sets that don't 
necessarily require a four-year degree.
    So at least they need to be made aware of that track, 
because in America college should be available to everybody 
regardless of background or income or race, but college isn't 
for everybody. A lot of folks may want to go into that sort of 
skills training track, particularly when if they have the right 
skill sets they can come out as a 21-year-old and be earning 
$55,000 a year; in four years, develop in their job, be earning 
$95,000 a year. That's a good life and a good living in 
Louisiana.
    Representative Boustany. Wanted to show you on that slide 
one of the things Louisiana is facing as a State, the need and 
demand for the [inaudible] skill sets. I'm so glad to hear what 
you just said, because I think David [inaudible]. He said we 
have to start job skill training [inaudible]. Pick a skill when 
you're in middle school, start learning the basics, carry it on 
into high school, and when you graduate, if you don't go to 
college, you've got a leg up. You're ready to go. If you do go 
to college, you've got a way to help pay for it because you've 
[inaudible].
    If you don't need all that help and you're fortunate enough 
to have parents who can pay for all that, then you don't end up 
like me where you don't have a skill around the house. My wife 
constantly complains that I can't fix anything around the 
house. I wish I had a skill like that, do a little [inaudible].
    So I think starting early--and this is something, this is 
[inaudible], these students [inaudible] high school and be 
ready to go to community college, refine those skills and make 
a lot of money [inaudible].
    Ms. Knight. Can I just bring two things to your attention?
    Chairman Vitter. Sure.
    Ms. Knight. One is, one of the reasons why the colleges and 
even high schools would shift away from this technical training 
that needs to happen into kind of a soft educational area is 
because even though 30 or 40 students are sitting in one 
classroom with desks and chairs, that's the full extent of your 
investment into the infrastructure necessary to educate them on 
something like this.
    But in order to do so [inaudible] testing or for any of the 
other hard skills, a higher level of investment [inaudible] 
towards the community college [inaudible] in leadership 
positions will take that into consideration in higher education 
to encourage that investment into infrastructure in the 
schools, including I love the idea of high schools and junior 
high schools teaching those skills because I've got lifetime 
work even though [inaudible] my business degree and [inaudible] 
I still [inaudible] a lot of different things.
    Our world today allows people to learn history or art or 
music or any of those other things on their own time 
[inaudible]. But those skills have to be learned early 
[inaudible].
    Chairman Vitter. Well, you make a great point, and that is 
a factor. But for that to dominate and to decide what community 
colleges focus on is the cart before the horse. Again, we 
really need to tie everything into what the job market is 
looking for and how we're going to best prepare these young 
people for these jobs.
    Okay, Curtis Hollinger. Where is Curtis?
    Mr. Hollinger. Yes, sir. What is your vision for tort 
reform in Louisiana, particularly related to the American 
energy renaissance?
    Chairman Vitter. Well, Curtis, I am very focused on that. I 
think in general, the business climate in Louisiana, including 
in the energy sector, is the best it's been in my lifetime. I'm 
53. I think it's the best it's been in my lifetime. But the one 
big exception to that rule, in my opinion, is the litigation 
climate, which by every measure is really negative and keeps 
good jobs and good businesses out of Louisiana, including in 
the energy sector. I'll give you one example.
    I had a meeting in Houston five months ago with Jeff 
Hildebrand. He's head of a big energy company called Hilcorp, 
which is actually the biggest payer of oil- and gas-related 
taxes to the State of Louisiana, because it's the biggest 
producer on State land and State water. And he said, David, we 
have operations all over, all over the country, many parts of 
the world, and we take our responsibilities very seriously for 
safety, for a clean environment, but we still have 75 lawsuits 
filed against us, and 70 are in Louisiana.
    It's a horrible litigation environment. It's a horrible 
threat to us, and we're not expanding anything in Louisiana 
specifically because of that. And so that is a big issue that 
holds us back, I think, including in the energy sector.
    Mr. Hollinger. Can you describe [inaudible]?
    Chairman Vitter. Yes. Well, I'll give you one concrete 
example in the energy sector, since we're talking about that 
today, called legacy lawsuits. That is when land owners find 
any contamination on their land from prior oil and gas 
development. Nobody is arguing that whoever is responsible for 
that should fully clean it up. But what happens instead, 
because of the nature of our State laws and our court system, 
is that everybody who ever had anything to do with development 
on that property for 60 years or more, everybody is sued, 
number one, no matter what their involvement or non-involvement 
was.
    Number two, there is no cap on damages. So damages can be 
as high as the plaintiff lawyer expert says they should be. 
There's no cap related to anything, including the fair market 
value of the land.
    And then number three, there's no rule that those damages 
have to be used to clean up the land. So that's crazy. It leads 
to a cottage industry of lawsuits rather than a system that 
actually gets any legitimate problems cleaned up. So that would 
be an example of what I'm talking about.
    Representative Boustany. David just described the standard 
appropriately. We all know Louisianans care about our 
environment, and I think good energy policy, good environmental 
policy, good economic policy go hand in hand [inaudible].
    But I had a similar experience. I was in Houston just a few 
weeks ago. A gentleman by the name of Gary Luquette, who is 
from the [inaudible] area, just took over as CEO of Frank's 
International [inaudible]. Well, their headquarters now for 
global work is in Houston. Gary told me point blank--we were 
talking about all the things going on in the energy sector, 
going on around the world. He said, let me tell you what the 
biggest threat to Louisiana is. [Inaudible] investments in 
there, you got mobile trends, price down [inaudible], layoffs. 
He said the biggest threat is these legacy lawsuits. You're 
going to drive the industry that helped create Louisiana out of 
Louisiana.
    David described beautifully all the problems with the 
system as it's set up. That's why we've got to change the 
[inaudible].
    Chairman Vitter. Let's take one more question. Then we're 
going to go to our expert witnesses.
    Anita Johnson? Where is Anita? Yes, ma'am.
    Ms. Johnson. Is there any legislation coming up regarding 
adverse regulations like the EPA?
    Chairman Vitter. Why don't you elaborate, Anita?
    Ms. Johnson. Well, I just hear and read so much about how 
the Congress [inaudible] and every regulation that they make up 
increases the cost of [inaudible] and they wind up having to 
lay off people [inaudible]. And a lot of the regulations they 
make are not necessary.
    Chairman Vitter. Right, right. Well, first of all, let me 
agree with your statement. I agree with that. I happen to be on 
the Senate committee that deals with everything related to EPA, 
so I'm constantly working to push back on those sorts of 
regulations.
    In fact, there are three brand-new sets of regulations that 
they're working on that they're pushing forward that I think 
fall into the category you're describing where costs and burden 
goes through the roof. So costs to small business goes through 
the roof, and any positive impact in terms of health and safety 
is minimal, at best. So that's the new ozone standard, that's 
the greenhouse gas regulation, and that's a set of regulations 
that would dramatically expand the jurisdiction of the Clean 
Water Act.
    So in each of these cases, Charles and I both are working 
on ways to push back and try to block that sort of over-
regulation.
    Charles.
    Representative Boustany. Yes, I agree with David there. We 
have worked on those specific issues. This is one of the 
[inaudible] we have right now at the Federal level where you 
have Federal agencies that are really not very accountable to 
each and every one of us. They make rules, and Congress ought 
to be doing that, put sunshine there on what's going on, full 
transparency and disclosure.
    We've been blind sided by those rules out there, and they 
make no sense, very little consultation about what the impact 
will be, and the House keeps trying to pass legislation--we 
have passed legislation in the House a few times that would 
basically say that any new rule put out there that would have a 
significant impact on the economy has to go back to the House 
and Senate for a vote and approved before it can be enacted, 
and we're still working on that project. I'm hopeful now with a 
more favorable Senate that we'll be able to move this through 
and put it on the President's desk. I'm not optimistic he would 
sign something like that, but this is the fight we're having 
with the Executive Branch.
    It's not just this Administration. This problem goes all 
the way back to Franklin Delano Roosevelt when he did this kind 
of thing. But we've got to get back to a balance, a 
constitutional balance, [inaudible] laws [inaudible] in the way 
Congress intended. That's the way our Constitution is supposed 
to work.
    Chairman Vitter. And I certainly agree with that 
legislation. I'm a leading co-author of it in the Senate. That 
would help right the balance. Instead of Congress having to 
affirmatively block all of these huge costly regulations, if 
they're above a certain amount in terms of economic impact, 
Congress should have to affirmatively pass off on them. I think 
that would immediately right the ship if we can get that into 
law.
    Okay, thank you all very much. We're now going to move on 
to the next part of the morning, which is hearing from our 
expert witnesses on our main topic today, how small businesses 
are supporting America's energy renaissance.
    I'll introduce each of them in turn, and then they'll each 
present testimony for about 5 minutes, following which we'll 
have a discussion with them on the topic.
    First we have Dr. Natalie Harder, Ph.D. Dr. Harder is 
Chancellor of South Louisiana Community College, and she took 
over those responsibilities in 2011. Previously, she also 
served as Interim Director of the Acadiana Technical College. 
So she has a long history and set of experiences in the 
community and technical college system.
    Dr. Harder, welcome, and please kick us off.

   STATEMENT OF NATALIE J. HARDER, PH.D., CHANCELLOR, SOUTH 
                  LOUISIANA COMMUNITY COLLEGE

    Dr. Harder. Great. Thank you, and I so appreciate the 
opportunity to testify this morning.
    Small businesses and their entrepreneurs are needed in our 
globally competitive environment now more than ever. Small 
businesses are the companies which are able to be nimble in an 
ever-changing environment, but which also work hard to keep 
their workers employed through turbulent times. The 
understanding of their employees as more than just inputs is 
what makes energy's small businesses the anchors of regional 
economies like Acadiana.
    Small businesses often provide niche services that large 
industries cannot manage well, particularly small companies 
located in areas like Acadiana where specialization in the 
energy industry is paramount. As our region is ``all energy all 
day,'' advances in technology, resources and training from our 
small companies make them and their clients better situated for 
competing on a global stage.
    The importance of these small companies to the local 
community cannot be overstated and is often overlooked. Just 
last week I was with the Louisiana Gulf Coast Oil Exposition to 
announce its endowment of a faculty position for our oil and 
gas programs. In thanking LAGCOE's treasurer, Greg Stutes, for 
the support of his company, Completion Specialists, Mr. Stutes 
talked about how his company gives back 10 percent of its 
profits to local charities each year. Ten percent, every year, 
year after year. So not only is that company employing local 
individuals, they are supporting organizations important to our 
regional infrastructure.
    Acadiana thrives on small businesses contributing to the 
local economy and energy renaissance as they bring growth and 
innovation to the region in which the businesses are 
established. Many of these companies rely on graduates from 
community colleges like South Louisiana Community College to be 
competitive and to grow. One example of this growth and 
innovation is Map Oil Tools in New Iberia. Map Oil Tools is a 
small business of entrepreneurs which actively supports the 
energy sector in Acadiana.
    Map Oil Tools is helping to stimulate economic growth with 
new products and solutions, and in providing employment 
opportunities. South Louisiana Community College is working 
with Map Oil Tools to provide down hole technicians with our 
new down hole technician program. This partnership will support 
and grow a company based right here in Acadiana but which 
serves an international audience with local employees.
    South Louisiana Community College works with other small 
businesses to provide an educated workforce so that these 
companies can continue to play an important role in the local 
economy. These companies include, but aren't limited to, 
Aerion, which provides completion services and equipment 
rentals for the oil and gas industry; Weatherford, that 
specializes in innovative evaluation techniques; and also 
Knight Oil Tools, which has been a leading innovator for the 
energy industry from its headquarters in Acadiana. All of these 
companies employ graduates from Louisiana colleges, including 
South Louisiana Community College.
    For all Acadiana oil and gas companies, a strong local 
workforce is the key to their success, and in turn, those 
employees fuel our regional economy. Critical to developing 
this workforce is the return of year-round Pell Grants, 
restoration of full ability to benefit Pell and allowing the 
use of Pell for short-term and non-credit programs. With 
funding Pell in these ways, we allow more graduates and 
community college programs like welding, machine tool 
technology, oil and gas production, down hole tool technology, 
process technology, diesel technology, and heavy equipment 
operations.
    Remember that Pell primarily funds low-income and often 
first-generation college students. With only 600,000 of the 2.3 
million adults eligible to work in Louisiana holding a college 
degree or credential--let me say that again, 2.3 million adults 
eligible to work in this State, and less than 30 percent of 
them have any college degree or credential--Pell is important.
    Louisiana is in greater need than other states for Pell 
funding to move 70 percent of its working population to 
maximize their own capabilities as they help meet our workforce 
needs in oil and gas. By funding Pell Grants appropriately, the 
companies I mentioned are just a few of the many small energy-
based companies which can continue to competitively employ 
thousands of individuals trained in our region, but which can 
also grow with a well-trained workforce.
    We need to continue to support these companies to maintain 
a strong economic fabric in the Acadiana region. Thank you.
    [The prepared statement of Dr. Harder follows:]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Vitter. Thank you very much, Dr. Harder.
    Next we'll hear from Joshua A. Pellerin, President and 
Chief Executive Officer of Pellerin Energy Group LLC. That 
group is made up of Pellerin Water Solutions, Energy Rentals 
and Chemicals, so obviously all related to the energy industry 
here in South Louisiana, and those companies are located in 
Broussard, Louisiana.
    Joshua, thank you for being with us.

  STATEMENT OF JOSHUA A. PELLERIN, PRESIDENT & CEO, PELLERIN 
                        ENERGY GROUP LLC

    Mr. Pellerin. Chairman Vitter, thank you for the 
introduction, and thank you for having me here today to testify 
and participate in this very important hearing discussing ways 
to help in the coordination of Federal efforts that would allow 
small businesses to better support the U.S. energy industry.
    My name is Joshua Pellerin. I am the President and CEO of 
Pellerin Energy Group based in Lafayette, Louisiana. Pellerin 
Energy Group through its various subsidiaries provides 
integrated services and optimal solutions to the oil and gas 
industry.
    We must not forget the important role oil and gas producers 
have in supporting the small business supply chain and 
impacting our energy security. Large and small companies work 
together to meet America's energy demand. According to the 
recent Census data, there are over 46,000 small businesses 
supporting the production of oil and natural gas in the United 
States that directly employ over 300,000 workers. Every day, 
they provide a vital aspect to the generation of America's 
energy.
    Energy-related jobs pay the kind of wages and salaries, in 
my view, and I know it's shared by many here, that allow 
families to invest in homes, in their education, and in their 
futures. If Congress can take the steps to increase domestic 
energy production, we not only increase America's energy 
independence, but we also create the kinds of jobs that will 
grow the middle class and have a major impact on reducing 
income inequality in our country, which is a goal I believe we 
all share.
    The major oil and gas companies find investments in the 
United States to be attractive for several reasons. The U.S. is 
a stable country. It is a country with fair and well-
established laws and tax regulations that make drilling, 
development, and production for oil and gas in the U.S. 
economically attractive. The U.S. has been blessed that oil and 
gas has been found here in abundance and collects revenues 
averaging $85 million a day in taxes, rents, royalties, and 
bonuses.
    While our tax laws are and have been used to incentivize 
direct investments of capital throughout the history of our 
country, I would argue that they are not giveaways, and 
changing existing tax laws and regulations for the oil and gas 
industry at this time would have a very detrimental effect. The 
economic ripple would adversely impact the job growth revenues 
of many small businesses in our domestic supply chain and those 
that depend on a secure energy supply.
    In short, changes to the tax code in cost recovery would 
unintentionally hit the brakes on America's energy and 
manufacturing renaissance and have a devastating effect on 
jobs, the economy, and revenue to the government.
    Our economic engine is fueled by entrepreneurial drive, 
individual ambition, creativity, and broad economic 
participation. Principally this means promoting accessibility 
in every sense of the word in every field of endeavor, 
geographically, affinity, and focus.
    There is a strong global demand for small U.S. companies to 
export their products outside the U.S. We must enable export 
growth by reducing barriers to small business exports, 
simplifying trade, and facilitating small business engagement 
with global markets. Exporting will support economic growth and 
job creation by expanding our access to the fastest growing and 
most dynamic regions on the planet. Small businesses that 
export to foreign markets grow faster, create more jobs, and 
pay higher wages.
    There are 28 million U.S. small businesses, and 
approximately 300,000 U.S. small businesses export. Of the 
businesses that export, only about 40 percent export to more 
than one country. Ninety-eight percent of U.S. businesses that 
export are small businesses, and small businesses have 
accounted for nearly two-thirds of net new private-sector jobs 
in recent decades.
    We must provide our minorities, women, and small business 
owners with the entrepreneurial support and opportunities they 
rightfully deserve. All Americans deserve to be given an equal 
opportunity to pursue the American Dream.
    According to the latest data from the U.S. Census Bureau, 
the number of people in the United States who are classified as 
ethnic and racial minorities has exceeded 100 million. Today, 
one in every three U.S. residents is classified as a minority. 
Additionally, there are now over 4 million minority-owned 
businesses across the country, accounting for over $591 billion 
in annual revenues.
    For the past two decades, women-owned businesses have been 
the fastest growing segment in the U.S. economy, growing at 
twice the rate of all other businesses, with 10.1 million 
women-owned businesses employing 13 million Americans and 
generating $1.9 trillion in annual revenues in 2008 alone. 
Women entrepreneurs drive our nation's economy by starting 
1,600 new businesses in America every single day. We need to 
make sure that our daughters have the same chance to pursue 
their dreams as our sons and urge businesses and the government 
to do more to hire women and achieve gender equality.
    We must encourage small businesses to explore their 
technological potential and provide the incentive to profit 
from its commercialization. By including qualified small 
businesses in the nation's research and development arena, 
high-tech innovation is stimulated and the United States gains 
entrepreneurial spirit.
    The men and women who serve our nation in the military 
deserve more than just our respect; they deserve our 
assistance. With more than 3.3 million veteran-owned small 
businesses in America, veterans play a critical role in 
strengthening and expanding our economy. It is imperative that 
the Committee continues to find innovative ways to further help 
our nation's heroes.
    Once again, thank you for this opportunity to testify, and 
God bless the United States of America.
    [The prepared statement of Mr. Pellerin follows:]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Vitter. Thank you very much, Josh.
    And last but certainly not least is Bill Fenstermaker. Bill 
is Chairman and CEO of C.H. Fenstermaker and Associates, a 
leading firm that provides surveying and other services to a 
host of Louisiana businesses, including in the energy sector. 
Bill is a member of the Greater Lafayette Chamber of Commerce. 
He is Chairman of the IberiaBank Corporation and Vice President 
of ULL's Board of Trustees for Membership.
    Bill, thanks for joining us.

 STATEMENT OF BILL FENSTERMAKER, CHAIRMAN & CEO, FENSTERMAKER 
                         AND ASSOCIATES

    Mr. Fenstermaker. Thank you, Senator Vitter. My comments 
today would be related to energy and the effects of low energy 
prices on South Louisiana.
    Louisiana oil and gas and Lafayette are synonymous. The 
people who live here are hard-working and are called upon to 
support oil and gas activities not only in this region but 
throughout the world. This is why Lafayette is the center of 
the service industry that supports the central Gulf of Mexico. 
In Lafayette, in our MSA, 26 percent of all earnings and 
approximately 11 percent of all employment comes through the 
energy business. Lafayette alone has over 17,000 people who 
work in the energy sector.
    Due to low oil and natural gas prices, times are pretty 
tough now. Most of our service industries have recently 
announced layoffs. Energy producers in Lafayette and Houston 
have announced that they are cutting operating budgets, 
sometimes as much as half and even more. Most have learned from 
the 1980's and are positioning themselves to withstand the 
storm caused by low commodity prices. Obviously, banks are much 
more circumspect when it comes to lending to anyone that has 
oil and gas exposure.
    From a banking perspective, serving as Chairman of 
IberiaBank Corporation--we bank a number of energy companies--a 
recent earning conference call was dominated by questions about 
energy exposures, which triggered a follow-up presentation in 
New York City where over 100 analysts attended and listened to 
our energy exposures today. Questions about these exposures are 
not only relegated to the analysts but also to banking 
regulators who stress-test all of our risk, with a big focus on 
energy.
    One bright spot has been the large number of LNG and 
natural gas to liquids projects being located in South 
Louisiana. But slumping oil prices have clouded their future, 
not only here but globally. These cost-intensive projects are 
now being threatened by the volatile market, making the 
prospect of U.S. energy independence in doubt.
    Certainly not helping are long application turnaround times 
by the Department of Energy and FERC, which negatively affect 
the economy of South Louisiana and the U.S. economy. These 
delays make it extremely difficult to meet current global 
demands for LNG and lets other nations to regain advantages in 
supplying the energy needs that many countries demand.
    I offer three things that could possibly help America. One 
is to end the 40-year-old executive order that prevents 
exporting oil overseas. This would significantly reduce the 
massive layoffs which are coming and continue our march in the 
United States for energy independence.
    Second, we do need to speed up the permits for all oil and 
gas activities, but specifically export of LNG.
    And third, we need to allow the export of LNG to all 
countries, not just some, and that would help our economy 
dramatically.
    Hopefully we don't squander these opportunities, and I 
thank you for allowing me to say those things today.
    [The prepared statement of Mr. Fenstermaker follows:]
    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Vitter. Thank you all very much for your 
testimony. You're really the heart of this program in terms of 
the Small Business Committee field hearing. We appreciate your 
being here.
    As we move on to questions and conversations, I'm going to 
turn to Charles for those first. But I do want to recognize two 
folks who have joined us in the audience.
    State Senator Elbert Guillory. Senator, thank you for being 
here and for your leadership.
    [Applause.]
    And also former mayor of Lafayette, Dudley Lastrapes. 
Mayor, thank you for being here.
    [Applause.]
    Charles, why don't you kick off questions and discussion?
    Representative Boustany. Well, thank you, Chairman Vitter. 
Thank you for convening this very, very important hearing.
    I think the three of you really encapsulated the 
opportunities and the challenges that we're facing here, and 
it's sort of a snapshot of what I think the rest of the country 
is seeing.
    Coming out of the recession, Louisiana sort of took a lead. 
Our economy bounced back quicker, and part of it--the two 
drivers nationally, and I think also in Louisiana, where the 
shale gas revolution and all the things that happened as a 
result that we benefited from, and exports, which also proved 
to be an early driver.
    Josh, you pointed out the opportunities that small firms 
could have as part of the global supply chain in the energy 
sector, and I believe our suppliers and service companies could 
benefit from having new market access, for instance, with the 
Trans-Pacific Partnership that we're negotiating, and the new 
European agreement.
    There's intense interest around the world in what's 
happened with the shale revolution here in Louisiana and the 
United States and what our companies offer. So could you 
elaborate a little bit more on this opportunity out there, even 
though we're facing some challenges and head winds today with 
low oil prices, new market conditions, OPEC's decision? How 
would new market access help small service companies like 
yourself?
    Mr. Pellerin. Well, I'll give you an example, Congressman 
Boustany. Just last week I was in Mexico City with the 
development of the Transboundary Hydrocarbon Agreement between 
the U.S. and Mexico, and it involves Canada as well. As you 
know, Mexico has had a hydrocarbon reform. Due to the low oil 
prices, that market isn't as attractive as it was maybe a year 
ago, but just by being able to go into that area and have 
relationships established with the focal points and key 
stakeholders within the various government entities, as well as 
the oil and gas companies, allows us to build, engineer, and 
manufacture equipment here in the United States and export that 
equipment to Mexico without having to actually have a presence, 
a location in the area.
    So by having that in place and by having the reform, that 
helps us, because if the Gulf of Mexico is not as busy, then 
certainly we can go into other areas such as Mexico, Saudi 
Arabia, any other part of the world that we had a trade 
agreement with.
    Representative Boustany. Thank you.
    And, Bill, you brought up some very, very interesting 
points about the opportunities and challenges and the fact that 
even with low oil prices, which is creating great difficulty, 
some serious head winds for a lot of our companies here, the 
low price of gas has opened up export opportunities around the 
world to countries like Japan that are energy starved. So it's 
sort of been a mixed picture.
    From your position in banking--you get to see the big 
picture, and also the Lafayette-focused picture as well--you 
mentioned three things. Permits, which I fully agree with. 
We've got to streamline the permitting process. You mentioned 
the issue of allowing exports to all countries, and I think 
that's important, and I'm glad to hear you say that crude 
exports are something we need to consider in addition to 
expediting LNG exports.
    Could you elaborate a little further on some of that and 
what opportunities those approaches would offer our small 
businesses here in this area and our entrepreneurs?
    Mr. Fenstermaker. Well, I think all of us have been looking 
at the supply chain. When you look at that, it's not really a 
pretty picture, but it's a great picture for America because we 
have been producing oil in record amounts, and we have been 
producing natural gas in most of the shale formations 
throughout the country.
    Right now we still have the situation of maybe pipeline 
infrastructure that needs to be built to be able to move the 
product from here to there, which right now gives us a little 
breathing time to be able to implement some of that, but maybe 
not the capital to do that because of the regulations and 
because of some of the stress testing that the people that 
would put forth those dollars are faced with.
    So right now, for instance, if you look at the Marcellus, a 
very rich natural gas play, they will be exporting or sending a 
lot of natural gas down to South Louisiana, because pipelines 
can go both ways. We also have the Haynesville which, as we all 
know, has been very good for our North Louisiana friends and 
also for the country. And then you have West Texas, where it's 
mostly oil.
    All of those things are very good and bode well for 
America. But with low energy prices, it's stopping. All of that 
is going to come to a complete halt. So we have to figure ways 
right now to be able to stimulate the industry and keep it 
moving forward, and the things that I mentioned about exporting 
make a lot of sense because the laws that regulate that were 
written back when we thought we had a tremendous energy 
shortage, and now we have a tremendous energy surplus. So that 
would help balance trade. It would also help a lot the jobs in 
America that have been missing for so many years.
    Representative Boustany. I appreciate that.
    And finally, Natalie, you're right in the thick of things 
when it comes to the workforce demands that we need to meet. 
Senator Vitter laid out some pretty stark numbers out there 
about the mismatch between projected demand and supply.
    I know you and I have talked personally about the Pell 
Grant flexibilities that would help this situation. Talk a 
little bit more about the outreach to the business community in 
trying to match up skill sets with what you're doing to meet 
those demands, and then how are you measuring. Are you 
following these students after they get out into the workforce 
and getting some feedback as to whether you matched up and what 
improvements need to be made?
    Dr. Harder. Yes. Thank you for the question. We certainly 
work with business and industry on a day-to-day basis to assess 
whether or not our programs are meeting their workforce needs. 
A clear example of that is we took about seven programs a year 
ago and condensed them into one-year programs, three-semester 
programs in welding, machine tool, industrial electronics and 
such, to specifically try to address the skills gap.
    The challenge of that becomes students are not eligible for 
Pell in the summer. So even though business is working and 
wants to hire individuals, these students then become 
financially stressed because they have no more dollars to 
attend college in the summer.
    Those programs are intensive. They're in class every day. 
So it's often hard for them to work enough hours in the spring 
and fall to save up for the summer.
    I will tell you, Congressman, in those technical programs, 
it's 100 percent placement. We have a very close working 
relationship with industry, and it's 100 percent placement and 
how can you graduate more is what we hear.
    Representative Boustany. Thank you.
    Thank you, David.
    Chairman Vitter. Great.
    As we go on, I also want to recognize a small business of 
the week. On our Senate Committee on Small Business and 
Entrepreneurship, we recognize a leading small business every 
week, and one recent business that was recognized was The 
Learning Train, and we do have Keri and Matt Hebert with us 
from the Learning Train.
    Thank you all for being an important part of the economy. 
Thank you all for being here.
    [Applause.]
    Let me ask Bill and Josh. I ask this of everyone in the 
industry, and nobody has a crystal ball, but obviously price is 
a big factor in this part of the economy right now. If you had 
to pick a price of a barrel of oil, guess at what that would be 
one year from today, give us your guess.
    Mr. Fenstermaker. Josh knows that answer.
    [Laughter.]
    Mr. Pellerin. I'll take a methodical approach, right? So, 
based on everything that I've read, we're looking at about, I 
guess, 24 months of the downturn before we see a recovery in 
the price of oil. I think 12 months from now we should be 
somewhere within $75 to $80 a barrel, is what we hope. That's a 
bit aggressive. I think full recovery, 24 months from what all 
the analysis and everything I've read. I think that that would 
be in the range.
    Chairman Vitter. Okay. And Bill.
    Mr. Fenstermaker. The experts tell me that $65 might be the 
price at the end of this year, and they say ``might'' because 
they don't know. I'm asked from time to time, too much, because 
I'm not an expert on pricing, so I have to go with them and 
hope it's much higher than that. But I'm factoring in all the 
different seminars and different things I've heard. Probably 
$60 to $65 a barrel at the end of this year, and a year later 
would be $75, maybe.
    Chairman Vitter. Right. And, Bill, you mentioned lifting 
the export ban on crude oil. If that were done tomorrow, do you 
think that would have a positive impact on price and this 
sector of our economy?
    Mr. Fenstermaker. Tremendous impact. Right now, if you just 
look at the supply curves and you look at the amount of oil 
that's coming on the market, and you look at the shortages 
throughout the world of oil and the growth maybe of all the 
economies throughout the world, Louisiana would benefit 
handsomely, and small businesses would benefit handsomely if we 
could export oil and natural gas to everywhere.
    Chairman Vitter. Josh, let me ask you. You're a great 
example of a Louisiana small business in this sector. In your 
very real-world experience, what are some of the biggest 
obstacles that any layer of government, any government agency 
or entity, puts in your way that is a particular problem for 
your business?
    Mr. Pellerin. Well, one of the businesses that we're 
involved in is the environmental component, which has produced 
water treatment. We are constantly looking at ways to bring to 
the market best available technology that would not necessarily 
create more regulation but would just better a process that's 
already been established and put in place.
    We're not in drilling, so we're not on the permit side of 
it, but we're directly affected by the red tape of getting 
permits, right? So the more wells that are drilled, the more 
platforms that are installed, the more equipment we get to 
sell. So we are affected, I guess, in an indirect way.
    But I think, as Mr. Fenstermaker stated, if we could have a 
permitting process that was streamlined and was very efficient 
and allowed the oil and gas companies to be able to get these 
permits and move forward with the drilling, then that would be 
something that would make it more attractive for them and less 
bureaucracy involved.
    Chairman Vitter. Okay.
    And, Dr. Harder, in our town hall meeting discussion, you 
heard some comments about maybe there being some bias in the 
community college system based on the cost of doing one type of 
program versus another, because clearly more equipment-
intensive training programs like welding are just much more 
expensive to put on.
    Do you think there is any element of that sort of bias in 
the system? And if there is to any extent, great or small, how 
do we counteract it?
    Dr. Harder. Well, I would like to address the fact that one 
day we would like to make a profit. I don't know that we've 
ever ascribed ourselves to that.
    [Laughter.]
    But it is true that clearly a technical program is much 
more cost-intensive than what one would consider a Humanities 
or general education section. But the way that we have 
addressed that is by partnering with business and industry, 
whether it's through the donation, for example, of welding rods 
to our welding programs, or computers to our Information 
Technology programs. We have really been aggressive over the 
last two, two-and-a-half years to bring our partners into the 
mix.
    An additional challenge, though, that we see is the ability 
to find faculty, quite frankly, not necessarily anything that 
the Federal Government or Congress could help us with, but it's 
just purely the ability to attract individuals from the private 
sector to the State salary schedule.
    Chairman Vitter. Right, right. Absolutely.
    And then another related issue we've been talking about is 
how you reach out to the private sector to determine exactly 
what skill set training programs are needed, and you touched on 
this a bit. Exactly how do you do that on a regular basis to 
get that feedback to help drive your curriculum?
    Dr. Harder. Well, certainly we meet with advisory 
committees which are made up of private-sector members at least 
twice a year. But a great example and a recent example is that 
we will start an oil and gas production program this fall. The 
advisory committee includes many small businesses, as well as 
folks like Halliburton and Baker Hughes that have literally 
crafted the curriculum with us to make sure that those 
individuals have exactly the skills and the training they need 
to be hired as soon as their program is finished.
    Chairman Vitter. Right. And then a final thought about 
workforce training. We also talked about the sort of high 
school tie-in. Now, there is more focus there than just a few 
years ago. There is a state program, Jump Start, that's trying 
to bring more skills training to the high school level as a 
prelude to some of those kids going for community college or 
skills training opportunities.
    How do you see that working in your geographic footprint in 
terms of your partnership with high schools, and what more do 
we need to be doing?
    Dr. Harder. Well, we do plenty of that through our dual 
enrollment efforts, where students are high schools students, 
but then they take college-level courses that both meet the 
high school requirement but also help lead them to an IBC, an 
industry-based certification. Obviously, welding is a good 
example of that, machine tool, some CNA programs and things 
like that.
    But we do dual enrollment all day, every day, and the 
beauty of it is it allows the high school to determine whether 
or not they want to have the sunk cost of those programs 
specifically on their high school campus, or they merely want 
to shuttle their students over to us and take advantage of the 
infrastructure that we already have. So we do that in many 
different ways.
    We're also in the process of creating a high school that 
will allow a student to graduate with a technical Associate's 
degree in something like welding or machine tool. We have an 
Early College Academy now where students graduate with an 
Associate's degree, and the day they graduate from high school, 
which means whether they choose to work after that Associate's 
degree or go on to their four-year degree, they're in the 
workforce at least two years earlier, and we're looking to 
replicate that but with a technical model.
    Chairman Vitter. Okay. Great.
    Charles, do you have any final wrap-up questions?
    Representative Boustany. Yes, just a final wrap-up, and we 
were talking about the oil pricing. I know we have a split 
between WTI and Brent, and it's about $9.00 as of today, Brent 
being higher. If we were to export, many have said that we 
would start to see equilibration. That spread would shrink, 
which means pricing for U.S.-produced oil would probably go up, 
helping our small businesses.
    But one of the other things that I think, Bill, you 
referenced was the infrastructure limitation, because even if 
we were to export oil today--the pressure would be to narrow 
that spread in pricing and help get better price stability--we 
still have a logjam at Cushing. We still have pipelines that 
need to be constructed. Being in the engineering sector, could 
you comment briefly on that?
    Mr. Fenstermaker. Well, of course, all that takes time and 
capital, and right now, to be able to put capital on a massive 
spending program such as pipelines, which are not cheap to 
build, and to deal with the permitting time it takes to get 
through the malaise of different regulations required for 
permitting a pipeline, the question becomes is the capital 
there to allow people to do it.
    Now, right now it is catch-up time, and we do have a lot of 
plans right now and a lot of different companies to be able to 
build a certain pipeline infrastructure. But it's imperative 
that we do that, because if these export bans are lifted, 
you're talking about an equalization of price, an equalization 
of access of oil throughout the country is there. We do need to 
somehow stimulate that ability and add certainty to the 
process. Certainty is a big thing in the energy business, and 
that's something we don't have right now.
    Representative Boustany. And I appreciate that.
    Senator Vitter, Chairman Vitter, thank you. This has been a 
really informative hearing. I appreciate it.
    I'm going to have to leave. I have to catch a flight, but I 
appreciate you including me in this. Thank you.
    Chairman Vitter. Absolutely, Charles. Thank you.
    Representative Boustany. I thank our panelists.
    Chairman Vitter. We're going to wrap up in general, so 
let's all thank our panelists for being with us today, part of 
the program.
    [Applause.]
    Charles, thanks for your participation, and thanks to all 
of you for coming out.
    I certainly want to remain in touch on an ongoing basis. We 
have some handouts that include all my contact information. So 
please keep that handy so you can be in touch on an ongoing 
basis.
    But thanks to everybody very, very much. Appreciate it.
    [Whereupon, at 9:43 a.m., the hearing was adjourned.]

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