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54–019 PDF 2009

RECOVERY ACT: 

PROGRESS REPORT FOR 

TRANSPORTATION INFRASTRUCTURE 

INVESTMENT 

(111–83) 

HEARING 

BEFORE THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

December 10, 2009 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JAMES L. OBERSTAR, Minnesota, Chairman 

NICK J. RAHALL, II, West Virginia, Vice 

Chair 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

GENE TAYLOR, Mississippi 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

BRIAN BAIRD, Washington 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

MICHAEL A. ARCURI, New York 

HARRY E. MITCHELL, Arizona 

CHRISTOPHER P. CARNEY, Pennsylvania 

JOHN J. HALL, New York 

STEVE KAGEN, Wisconsin 

STEVE COHEN, Tennessee 

LAURA A. RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

SOLOMON P. ORTIZ, Texas 

PHIL HARE, Illinois 

JOHN A. BOCCIERI, Ohio 

MARK H. SCHAUER, Michigan 

BETSY MARKEY, Colorado 

PARKER GRIFFITH, Alabama 

MICHAEL E. MCMAHON, New York 

THOMAS S. P. PERRIELLO, Virginia 

DINA TITUS, Nevada 

HARRY TEAGUE, New Mexico 

JOHN GARAMENDI, California 

JOHN L. MICA, Florida 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

VERNON J. EHLERS, Michigan 

FRANK A. LOBIONDO, New Jersey 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

JOHN BOOZMAN, Arkansas 

SHELLEY MOORE CAPITO, West Virginia 

JIM GERLACH, Pennsylvania 

MARIO DIAZ-BALART, Florida 

CHARLES W. DENT, Pennsylvania 

CONNIE MACK, Florida 

LYNN A WESTMORELAND, Georgia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

ROBERT E. LATTA, Ohio 

BRETT GUTHRIE, Kentucky 

ANH ‘‘JOSEPH’’ CAO, Louisiana 

AARON SCHOCK, Illinois 

PETE OLSON, Texas 

(II) 

(III) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... v 

TESTIMONY 

Andolino, Rosemarie S., Commissioner of Aviation, Chicago Department of 

Aviation, representing the American Association of Airport Executives ......... 45 

Calabrese, Joseph, General Manager, Greater Cleveland Regional Transit 

Authority, representing the American Public Transportation Association ..... 45 

Porcari, Hon. John D., Deputy Secretary, U.S. Department of Transportation . 6 

Ridley, Gary, Secretary, Oklahoma Department of Transportation, representing the American Association of State Highway and Transportation 

Officials ................................................................................................................. 45 

Siggerud, Katherine A., Managing Director, Physical Infrastructure Issues, 

Government Accountability Office ...................................................................... 45 

Van Buren, James W., Vice President, Development, and Chief Operating 

Officer, New Enterprise Stone and Lime Co., Inc., representing the American Road and Transportation Builders Association ......................................... 45 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Brown, Jr., Hon. Henry E., of South Carolina ...................................................... 76 

Carnahan, Hon. Russ, of Missouri ......................................................................... 78 

Johnson, Hon. Eddie Bernice, of Texas .................................................................. 79 

Markey, Hon. Betsy, of Colorado ............................................................................ 83 

Oberstar, Hon. James L., of Minnesota ................................................................. 87 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Andolino, Rosemarie S. ........................................................................................... 93 

Calabrese, Joseph .................................................................................................... 103 

Porcari, Hon. John D. .............................................................................................. 111 

Ridley, Gary ............................................................................................................. 115 

Siggerud, Katherine A. ............................................................................................ 127 

Van Buren, James W. .............................................................................................. 157 

SUBMISSIONS FOR THE RECORD 

‘‘Committee on Transportation and Infrastructure the American Recovery 

and Reinvestment Act of 2009 (P.L. 111-5) (Recovery Act) Bridges Improved 

by Recovery Act Highway and Bridge Funds,’’ Committee on Transportation 

and Infrastructure Majority Staff, chart ............................................................ lxi 

‘‘Committee on Transportation and Infrastructure the American Recovery 

and Reinvestment Act of 2009 (P.L. 111-5) (Recovery Act) Miles Improved 

by Recovery Act Highway and Bridge Funds,’’ Committee on Transportation 

and Infrastructure Majority Staff, chart ............................................................ lxii 

Larsen, Hon. Rick, a Representative in Congress from the State of Washington, ‘‘Stimulus Newsletter’’ ............................................................................ 26 

Porcari, Hon. John D., Deputy Secretary, U.S. Department of Transportation: 

Response to request for information from Rep. Cao, a Representative 

in Congresss from State of Louisiana ...................................................... 14 

Response to request for information from Rep. Oberstar, a Representative in Congress from the State of Minnesota ........................................ 41 

‘‘T&I Committee Transparency and Accountability Information by State and 

Formula Funding under the American Recovery and Reinvestment Act 

of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by T&I Committee (Data Reported as of October 31, 2009,’’ Committee on Transportation and Infrastructure Majority Staff, chart ................................................. lxiii 

Page

IV 

‘‘T&I Committee Transparency and Accountability Information by State under 

the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by T&I Committee (Data Reported as of 

October 31, 2009) Percentage of Allocated Funds Associated with Project 

Stages Clean Water State Revolving Fund,’’ Committee on Transportation 

and Infrastructure Majority Staff, chart ............................................................ lxxi 

‘‘T&I Committee Transparency and Accountability Information by State under 

the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by T&I Committee (Data Reported as of 

October 31, 2009) Percentage of Allocated Funds Associated with Project 

Stages Highways and Bridges,’’ Committee on Transportation and Infrastructure Majority Staff, chart ............................................................................ lxx 

‘‘The American Recovery and Reinvestment Act of 2009 Transportation and 

Infrastructure Provisions Implementation Status as of November 20, 2009,’’ 

Committee on Transportation and Infrastructure Majority Staff, report ....... xiv 

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(1) 

HEARING ON RECOVERY ACT: PROGRESS REPORT FOR TRANSPORTATION INFRASTRUCTURE INVESTMENT 

Thursday, December 10, 2009 

HOUSE OF REPRESENTATIVES, COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, WASHINGTON, DC. 

The Committee met, pursuant to call, at 10:11 a.m., in Room 

2167, Rayburn House Office Building, Hon. James Oberstar [Chairman of the Committee] presiding. 

Mr. OBERSTAR. Good morning. Welcome to the Committee on 

Transportation and Infrastructure. I apologize for the little delay. 

We were having a consultation of sorts with Mr. Duncan, a conversation about various and sundry things relating to the wellbeing of the U.S. House of Representatives. 

This is the fifth in the series of oversight and accountability 

hearings that we are conducting, as promised, in Full Committee, 

and at least three, four other hearings held by various Subcommittees on the progress and work of the Recovery Act portions that are 

under the jurisdiction of this committee. 

As we will see in the course of this morning’s presentation, there 

are 7,900 highway transit projectsunderway, have broken ground, 

have people working; hundreds of thousands off the unemployment 

rolls onto the payrolls and paying their taxes and paying their 

mortgage and getting their health insurance reinstated and sending their kids to school. 

As I said in a burst of enthusiasm at a groundbreaking project 

in New Mexico, these are the good jobs with the good wages in society that enable the workers to pay the mortgage, send the kids 

through school, put food on the table, and buy the snowmobiles. 

Then there is a silence in the crowd. I said, Oh, I guess you are 

not into snowmobiles out here in Las Cruces, New Mexico. Sorry, 

I got carried away. How about ATVs? We use those, too, in Minnesota. 

Today, there is a new feature of our report, a compilation that 

I have been anxiously awaiting, roads and miles of roads and numbers of bridges. Nationally, new construction, pavement improvements, pavement widening, traffic safety management, and the 

transportation enhancements have added up to 27,756.6 miles of 

road improvement. That is more than all the States do in any given 

year, in 11 months. And 1,272 bridge improvements, bridge replacements, new bridge construction. In addition, of the 11,746 

highway and bridge contractors in the U.S., 87 percent are small 

businesses. They have less than fifty employees. Ninety-three perVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00073 Fmt 6633 Sfmt 6633 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
2 

cent have less than a hundred. So 11,000 contractors that have a 

hundred or less than a hundred employees, and they are underway 

with this stimulus program as well. 

Beyond those funds that we will hear about today, beyond the 

Recovery Act, AASHTO, the American Association of State Highway and Transportation Officials, and the American Public Transit 

Association, have identified $62 billion of projects that are ready to 

go to construction within the next 4 or 5 months; projects they can 

have under contract and underway because of the streamlining, because of moving these projects faster than ever before, because they 

know how the process works now and they are ready to go with 

phase 2 stimulus. 

I scheduled this, as the other hearings, to receive input from 

Federal, State, and local transportation personnel who are on the 

front lines in implementing the programs that we have authorized 

under the Recovery Act. Today, we are also going to hear from a 

supply chain sector leader whose company has been able to keep 

workers employed because of these recovery dollars. You don’t just 

build a highway. You need the sand and gravel, you need the asphalt, you need the cement that is folded in to make ready mix, 

and you need rebar and I-beams and you need fencing and fence 

posts. You need all of that. All those create jobs as well. 

I don’t know about the rest of stimulus. I speak not for the tax 

cut that went out, I speak not for thebroadband and the Internet 

and all the rest of those things. I know what we are accounting for, 

and there are real jobs, real people at work, payrolls being met, 

people taken off unemployment compensation, people getting their 

health insurance reinstated. In the case of those operating engineers who typically have a contract that requires 1,200 hours of 

work, they are getting their 1,200 hours, they are getting their 

health insurance reinstated, they are paying their mortgages, they 

are staying in their homes, they are sending their kid to summer 

camp and to school. 

10,329 highway and transit projects are out to bid, totaling 

$24.5, 71 percent of the available formula funds. 8,871 highway 

and transit projects, $20.2 billion, 59 percent are under contract, 

and work has begun on 7,086 projects. These graphs show the results. 

When you add up what we are reporting on today, as of November 1, we have payroll expenditures of $1.1 billion, $179 million in 

unemployment compensation checks avoided, and $230 million paid 

in direct Federal taxes. When you add up also the supply chain and 

the steel, sand, and gravel, as I said a moment ago, and asphalt 

and manufactured equipment, new buses and those who are building D4 cats and front-end loaders and the rest of the heavy highway construction equipment, that is 630,000 jobs; nearly 1,300 

bridge improvements; 28,000 miles, nearly, of highway improvements. When you add in the Clean Water Act, the GSA with its 

Federal building responsibilities, when you add in work the Corps 

of Engineers is doing, the shipyards under MARAD, the Coast 

Guard bridge replacements that have been completed, that is 

14,564 projects under our Committee jurisdiction, totaling $44.7 

billion, 70 percent of the funds, as of November 20. In addition, 

State and other agencies have obligated $37.8 billion. 

3 

So we are seeing work underway, people at work, jobs created, 

and remember that in December, 2007, there were 780,000 construction workers nationwide out of a job, sitting on a bench. Mr. 

Shuster and I moved the TEA-21 bill. We created a special account 

of $10 million for training of apprentices in the construction trades, 

knowing that there is going to be a surge of jobs. In the first 5 

years of TEA-21, 3 million net new construction jobs were created 

nationwide because of that program. We need to follow on a 6-year 

program to do exactly the same thing, only more. We can create 6 

million jobs with a $450 billion program compared to the $218 billion we had in TEA-21, which was a 40 percent increase over previous funding. 

Again, transportation investment creates jobs and permanent improvements and benefit the lives of our fellow citizens and improves commerce and moves goods more efficiently through our cities and rural areas into urban centers. We will hear more in detail 

from our upcoming witnesses. 

Mr. Duncan. 

Mr. DUNCAN. Thank you very much, Mr. Chairman, and thank 

you for your great leadership on this committee. I think the model 

of the way we should do infrastructure projects in this country was 

the Minneapolis bridge replacement project in Minnesota, under 

your leadership, which was done under expedited procedures. All of 

us who serve on this Committee believe very strongly in the work 

of this committee. In fact, in my first 6 years in the Congress I had 

two different offers to move to two different very important committees, but I chose to stay on this committee. And I have always 

been happy with that decision because I believe in what this Committee does, and I know that all of us on both sides believe a lot 

more work needs to be done on our roads and bridges, on our aviation system, on ourwastewater and clean water systems, at our 

ports and on our railroads and so forth, all the things that we handle in this committee. 

Of course, we do have an obligation to make sure that the money 

that flows through this committee, which is a very large amount, 

is spent in the most economic and efficient way possible. I think 

all of us were disappointed in the original stimulus bill, that of that 

$787 billion, which was sold to the country as being an infrastructure bill, that only about 8 percent went for actual infrastructure 

and according to the figures I have been given by the staff, the Department of Transportation got $48 billion of that. 

Mr. Mica, for whom I am sitting in today, he is at the funeral 

of former Senator Paula Hawkins, for whom he was Chief of Staff 

for a few years. He has asked me to say or point out that only 13 

percent of that money has been paid out thus far. But I do think 

that there are many good things that have been done with the portion that is going for infrastructure, and I think that almost everybody or hopefully everybody on this Committee wants to see a 

major highway bill sooner rather than later and we want to see 

this money spent properly. 

Just yesterday, Senators McCain and Coburn came out with a 

list of hundreds of stimulus projects. I don’t think many of them 

were transportation projects, but money that was being spent, 

many billions, in just ridiculous ways. I don’t think anybody in the 

4 

country or very many people support most of the things or a lot of 

the things that were shown in their report. 

We do want to work on these things. And when I said at the beginning of my remarks commending the Chairman and others on 

the Minneapolis bridge project, the thing that has disturbed me the 

most in my years on this Committee is the delay and the cost overruns that occur because of all the rules and regulations and red 

tape, so much so that we had a hearing one time a few years ago 

and they said the main runway at the Atlanta airport, the newest 

runway, took 14 years from conception to completion. It only took 

99 construction days. And they were so happy and relieved to finally get all the approvals that they did that in 33 24-hour days. 

We had a hearing a couple of years ago on the Highways and 

Transit Subcommittee, I forget whether it was a 9-mile or 12-mile 

project in southern California, road project, took 17 years from conception to completion. And almost all of these years added on to 

these projects are due to the environmental rules and regulations 

and red tape. 

We have tried to, but I think we need to do much more in getting 

environmental streamlining into these projects because when the 

average road project takes 10 to 12 years and these things are taking about three or four times as long as any other developed nation, it runs up the costs tremendously and also it makes it harder 

for us to compete in the global market that we have before us 

today. 

With that, I will yield back. I won’t be able to stay as long because I didn’t know that I was going to have to sit in. I have got 

some other appointments. But I will stay as long as I can. 

Thank very much, Mr. Chairman. 

Mr. OBERSTAR. We will enjoy your presence as long as you can 

remain with us. Thank you very much for your leadership, your 

chairmanship of the Aviation Subcommittee several years ago, and 

for your vigilance. It was during your tenure where we moved legislative language to expedite aviation projects. You and I worked 

together on that question. And airport runway projects have been 

speeded up since then. In the current SAFETEA legislation we had 

a further expediting, permit expediting provision that States have 

used and now have some experience. And we have a much expanded Office of Project Expediting in the Federal Highway Administration in our bill reported from Subcommittee. If we can ever get 

the administration to come on board and the Senate to move along, 

we could have had that bill passed already this year, in the House 

at any rate. I thank the gentleman for his participation. 

Mr. DUNCAN. Well, you also helped me, Mr. Chairman, on much 

of the work on the Public Buildings and Grounds on some of those 

major projects and also when I chaired the Water Resources Subcommittee. So I do greatly admire and respect you and I appreciate 

your leadership. We just need to keep trying to do more and do better. 

Mr. OBERSTAR. Exactly. I completely agree with you about the 

delays. We have a 30-year bridge in Minnesota that hasn’t been 

built. Let me amend that. It was 27. When we started with it, it 

was $30 million. Now it would be $300 million if we ever get it 

built. That is why we need project expediting. 

5 

By the way, on public buildings and courthouses, in the San 

Diego courthouse, because of what you started and we started together, we saved taxpayers $160 million. And we have a new courthouse and judges are going to do courtroom sharing. That is the 

kind of thing we ought to be doing. So we proved that—States have 

proved to us and AASHTO and State DOTs have demonstrated 

given the money, given the right circumstances, they can get these 

projects out the door, on the roadway, people working, without the 

delays that we have experienced in the past, and we are going to 

apply these lessons to the future of transportation. 

I announced earlier or at the previous hearing that to expedite 

things and because we are likely to have votes on the rule in an 

hour, I will ask Subcommittee Chairs for 2-minute statements, if 

they wish to do so. 

Ms. Norton. You have been very vigorous in holding hearings in 

your jurisdictional area, as has Ms. Johnson. 

Ms. NORTON. Yes, Mr. Chairman. With only brief remarks, we 

have had four tracking hearings. We are going to have a fifth hearing, a joint hearing with Ways and Means on a new, complex Social 

Security center that we are building with stimulus funding. 

I am very proud of what this Committee has done. What we are 

showing in jobs for this country basically comes out of this committee. I am pleased that my own jurisdiction, which ranked very 

low because it doesn’t have the fully staffed Department of Transportation, but contracts out, so it ranked very low, and it has shot 

up to 40th. 

But I am proud of them as well, Mr. Chairman, because you 

went with me to Murch Elementary School just last month when 

the city got a national award for safe schools routes. The Chairman 

was there. The children and the teachers could not have been more 

thrilled to have the full Chairman of the Committee come. That 

project is emblematic of the kinds of things the District has been 

doing. Instead of simply laying some concrete with the most shovelready projects, what they have done are things like safe routes and 

bike trails that are slightly more complicated because you have to 

take into account more factors. I am pleased that they don’t have 

the staff DOT that States do; they contract out most stuff. They 

have speeded up. 

I am particularly pleased that what I understand from the Department of Transportation is that the training fund you spoke 

about had indeed been allocated. This is the next generation of construction workers. Construction workers are like everybody else, 

they age out, they retire, and many of them have done so, creating 

shortages in the skilled crafts. 

So I very much appreciate what your Committee has done and 

what our own Committee has done on training funds with the 

money allocated to us for that purpose. 

Thank you, Mr. Chairman, for this very important hearing. 

Mr. OBERSTAR. Thank you very much. On EDA, the Economic 

Development Administration has awarded 68 grants, $147 million, 

100 percent of their funds, projects which most of them are completed already. 

Ms. Johnson, Chair of the Water Resources Subcommittee. 

6 

Ms. JOHNSON OF TEXAS. Thank you very much, Mr. Chairman. 

We had circumstances that changed in certain projects that we had 

going just after we planned the Recovery Act, and we are still trying to get some attention given to the new standard for the levees 

in Dallas. The biggest problem we have had is the way the funds 

have been distributed. Our major cities are complaining, but many 

of the rural areas have been waiting for a number of years, and 

they were ready to go. 

We have a long ways to go to satisfy many of thestakeholders, 

but we think we have gotten it pretty much back on track. 

Thank you. However, I must say, with the water portion of the 

bill and the revolving fund, it has not done anything yet. So we 

need to push that a little bit. 

Mr. OBERSTAR. EPA, unfortunately, had a very slow start, but 

they now have 1,269 State Revolving Loan Fund projects out, totaling $2.6 billion. That is two-thirds of the funds. And 723 projects 

are under contract. They had problems early on administering the 

Buy America language, but I think they have got that straightened 

out now and there are three different categories of exceptions for 

Buy America, and they have all been worked out to the satisfaction 

of State agencies. 

We are going to begin with Mr. Porcari. Thank you very much, 

Mr. Secretary, for being with us, for your previous service on the 

front line, transportation in the State of Maryland. It is my pleasure to work with you over many years. You bring a great level of 

expertise and history and understanding to the task at USDOT. So 

we welcome your comments. 

TESTIMONY OF THE HON. JOHN D. PORCARI, DEPUTY 

SECRETARY, U.S. DEPARTMENT OF TRANSPORTATION 

Mr. PORCARI. Thank you, Mr. Chairman and Congressman Duncan and Members of the Committee. It is my pleasure to be here 

today. I appreciate the opportunity to appear before you today to 

discuss the Department of Transportation’s progress in implementing the American Recovery and Reinvestment Act of 2009. 

We are now in the 43rd week of one of the most sweeping economic reform packages in U.S. history. DOT continues to make 

swift and substantial progress in getting projects out the door to 

revitalize transportation infrastructure and create good jobs for so 

many Americans hard hit by the recession. Today, I will provide an 

update on our progress and plans going forward. 

As of last week, of the $48.1 billion allocated to us, DOT had obligated $31.8 billion on nearly 11,000 projects nationwide. More 

than 7,100 of these projects are already under way, or completed, 

and more of them are coming online every day. DOT outlays are 

also steadily increasing. In week 32 of the Recovery Act implementation, we reported 3.4 billion in outlays. Ten weeks later, the outlays continued to climb an average of $342 million each week, 

reaching $6.8 billion in our most recent reports. This is clearly good 

news, and we expect this trend to continue as larger projects come 

online. 

Each of our operating administrations has achieved significant 

results worth noting. For example, the Federal Aviation Administration’s funding has supported 355 airport projects, representing 

7 

$1.1 billion of projects. I would also like to particularly highlight 

the positive results we are seeing from the Recovery Act’s exemption to the Alternative Minimum Tax. Fifty-seven transactions, representing about $7.3 billion in airport bonds, have been sold at 33 

different airports because of the AMT. This provision is helping us 

leverage our funding to get more Recovery Act resources. 

The Federal Highway Administration has authorized more than 

$21 billion in funding for nearly 9,500 projects, representing 79 

percent of the total funds provided to the States. 

On the transit side, to date the Federal Transit Administration 

has awarded nearly 700 grants, totaling $7.2 billion. An additional 

$500 million of projects is in the pipeline. 

All the work created by the Recovery Act is making real and tangible difference in the lives of many Americans. I would like to 

share just one example. Keith Kist of Cleveland, Ohio, is an experienced highway construction worker who was laid off during the recession. Today, Keith is back at work full time on a series of Recovery funded airport improvement projects in Cleveland that will 

keep him employed for quite a while. He is confident that more 

good Recovery jobs are out there for others in his local construction 

union as well. 

Looking ahead, DOT is pressing forward on the new initiatives 

included in the Recovery Act. We are preparing to award $8 billion 

to jump-start high-speed passenger rail service in America. In response to this groundbreaking opportunity, Secretary LaHood announced last week more than 30 domestic and foreign manufacturing firms have committed to establish or expand the manufacturing of parts, supplies, and equipment right here in the United 

States if they are selected by the States receiving these funds. 

We are clearly looking at the total jobs picture. This is a very significant achievement that will help to expand domestic assembly 

work and jump-start manufacturing in this country. We think it is 

a positive sign of things to come and a clear indication that the Recovery Act is working for America by creating jobs and investing 

in the new updated infrastructure that will help keep us competitive. 

Our $1.5 billion discretionary Tiger Grant program is also moving forward. We have over 1,400 applications and we are currently 

conducting an intensive review process on each and every one of 

those. We are expected to announce the grant recipients in January, 2010, ahead of the February deadline. 

DOT also participated in the first ever section 1512 job reporting 

effort that is required under the Recovery Act. Overall, our DOT 

recipients did an excellent job in responding to the stated request, 

with more than 96 percent of the recipients responding. 

In addition to all the direct jobs created, the Recovery Act also 

has a ripple effect that is creating and preserving additional jobs 

in communities across the country. There is no question the Recovery Act is helping to revive our economy and support hardworking 

families. We will continue to obligate the remaining funds as quickly and responsibly as possible and ensure these critical resources 

are put to work improving our infrastructure and creating good 

jobs for many Americans. We are proud of our program. 

8 

Mr. Chairman, that concludes my testimony. I will be pleased to 

answer any questions. 

Mr. OBERSTAR. Thank you for that splendid report, especially 

those personal stories that you included in your prepared statement. Mr. Keith Kist off the runway project in Cleveland, Sean 

Langois from Manchester, New Hampshire, on a Recovery roadwidening project. I have one myself. I have many, but one that 

sticks out in my mind was last August, on Interstate 35 between 

North Branch and Rush City, not cities that jump to the mind of 

Members outside the State of Minnesota, but it is 28 miles; that 

is 7 miles on a four-lane interstate highway, completely resurfaced, 

rebuilt. Magnificent project. 

I was first out at the sand and gravel pit to see the workers who 

have been called back to work in the gravel pit and providing aggregate for the highway project. The foreman called one of the 

trucks over to the side, those big, long belly dumpers that you see 

on highway construction projects. The driver shut off the engine, 

got out of the cab, jumped on the ground, and she threw her arms 

around me and said, Oh, you’re Jim Oberstar. Thank you for my 

job. And I said, No, you thank the Congress, thank the President, 

everybody that voted on it. 

But she said, A month ago my husband and I were sitting at the 

dinner table, the two boys had just gone to bed, and we were looking at each other, wondering where do we go from here. Our unemployment comp has run out. We don’t have any health insurance. 

We have got 2 months savings left for the mortgage. Are we going 

to be able to send the boys to summer camp, as we have done in 

the past? And we just hugged each other and cried. 

The next day, Ninth River Construction called and said, Report 

for work on Monday. This was a Wednesday. We won a Recovery 

Act bid for this project. She said, We are now getting a payroll 

check instead of an unemployment check. Of course, that ran out; 

the unemployment check ran out. They were making their payments on the mortgage. If we can get 1,200 hours on the job, we 

get our health insurance reinstated. And, yes, the boys went to 

summer camp. 

That is the human face of recovery. That is the story. That is two 

of the workers, as you said, but there are now 230,000 of those on 

construction projects all across America. If we add up all the other 

programs under our Committee jurisdiction, we have 857,000 construction workers on the job, getting a payroll—not getting an unemployment check; getting a payroll check, paying for their own 

health insurance and paying taxes. That is the human face of recovery. 

Now, as Ms. Duncan said earlier, our regret in this Committee 

is we didn’t have $700 billion to use and to invest. It could have 

all been spent well, effectively, fast, and with these great results. 

Mr. Duncan, do you have any comments? 

Mr. DUNCAN. Well, thank you, Mr. Chairman. We still need a lot 

of work, because I believe when the stimulus was passed unemployment was 8 percent, and now it is at 10 percent. As even as 

popular as my area is, the Knoxville area is doing well, but I have 

got one county that has 18 percent unemployment and another one 

that has 14.5 percent unemployment. And Tennessee as a whole is 

9 

at 10.5. So there are still a lot of people hurting out there, as you 

know. 

I am going to yield, though, for questions to my Members first, 

and go to Mr. Coble because he was the first one here. 

Mr. COBLE. I thank you, Mr. Duncan. Mr. Chairman, you and 

Mr. Duncan pretty well covered it in your opening statement. 

Mr. Secretary, good to have you with us. Mr. Secretary, how 

State and other stimulus grant recipients report jobs has been 

somewhat controversial in the past few weeks. Does DOT have a 

standard by which they expect States and stimulus grant recipients 

to abide by when counting and reporting jobs? 

Mr. PORCARI. The short answer is yes. They are reporting jobs 

to DOT. The section 1512 requirements in the Recovery Act are a 

separate reporting requirement that, quite frankly, was a little bit 

new to many of our recipients. Our highway recipients, State DOTs 

in particular, are very used to doing this. For transit and aviation, 

recipients, the 1512 reporting, which is direct jobs, was a somewhat 

different requirement, and had a bit of a learning curve. 

With that, 96 percent of our recipients reported their numbers. 

The 45,000 direct-jobs created number for the transportation 

projects to date, if anything, is conservative, and it is one that we 

believe will be refined going forward with this quarterly reporting. 

Mr. OBERSTAR. Will the gentleman yield? That is a very important point because the Vice President’s office issued a Recovery Act 

report that was filled with computer errors. Garbage in, garbage 

out. We had 27 congressional districts in Minnesota to my great 

surprise. But the reporting process that the Department is using 

was initiated in this Committee from the county highway engineers 

of Minnesota, who use a thumb drive about the size of my thumb, 

one of those little things that you and I aren’t very familiar with 

but those engineers on the jobs know. They report on the hours 

worked, the loads of sand and gravel brought to the job site, the 

cubic yards of concrete or asphalt poured, and they report that to 

MNDOT, and MNDOT is reporting directly to the Committee and 

we harmonized this reporting with Federal Highway Administration and U.S. DOT. 

So this Committee initiated it and all the States are doing the 

same thing. They are all reporting using the same profile, same 

data, same computer base, and you can go into our Web site and 

find all the data that you have before us right now, that this Committee initiated. 

Mr. COBLE. I thank the Chairman. 

Mr. OBERSTAR. I wish the other portions of the stimulus had 

done the same thing. Our committee, we are holding their feet to 

the fire. 

Mr. COBLE. I thank you for that, Mr. Chairman. If I may put another question. 

The FRA is preparing to willing to award an $8 million appropriated amount in the stimulus bill for high-speed rail projects, and 

North Carolina is one of the States that have made the application. 

How does DOT see the high-speed rail program developing, and 

specifically do you anticipate that a significant portion of these 

funds will be used for true high-speed rail; that is to say, projects 

10 

that will compete with air travel by providing 200-plus miles per 

hour? 

Mr. PORCARI. The high-speed rail $8 billion is most likely to fund 

a mix of projects, including, sir, truehigh-speed rail. I would point 

out that the definitions of high-speed rail can differ. You typically 

don’t start with 200-mile an hour service. You typically are starting 

with a dedicated right-of-way and high-speed service at 110 miles 

an hour or above, building to 200 miles or 175 miles an hour or 

whatever. 

We are in the very beginning stages of trying to get to high-speed 

rail. Although we do anticipate that we will have true high-speed 

rail projects, they are not likely to be at 200 miles an hour right 

out of the box. You need to actually build toward that, just as the 

interstate system was built as a system and wasn’t built in one 

round. 

Mr. COBLE. When do you think that may come into realization, 

Mr. Secretary? 

Mr. PORCARI. Different projects are at different levels of development. Some are fairly advanced in that they have the right-of-way, 

for example; may have some design work done. Others are a little 

further behind. I would point out that even at the 110-mile an hour 

definition of high-speed rail, that is a very significant advancement 

over what we have in the country, and we would anticipate that 

these projects would build up from there. 

Mr. COBLE. I thank you for that. Mr. Duncan, I thank you for 

yielding. I yield back, Mr. Chairman. 

Mr. OBERSTAR. Thank you, Mr. Coble. 

Ms. Norton. 

Ms. NORTON. Mr. Porcari, I sat in another hearing with another 

Committee on which I serve, a tough hearing, a Government Reform and Oversight hearing, in which we learned of some of the errors that were made. Frankly, I want to congratulate you and the 

Committee and the administration for doing what has never been 

done before. No one has ever tried to count jobs in process in realtime the way we are. And so it is a start-up process for us. You 

had to be shovel-ready, but you had to do something you have 

never done before, and mistakes were inevitable, but I hope we will 

continue to do it. And I congratulate all involved for attempting to 

do something that was risky but I think necessary to be done, even 

with the almost inevitable mistakes that would be made. 

I am interested in the work of this Committee in a real sense because it is a centerpiece. We know from the data, indeed more than 

tax cuts, that transportation and infrastructure spending not only 

creates jobs itself but, importantly, wakes up other sectors. I wonder if you have any sense of the other sectors down the line which 

perhaps are not construction jobs. And we know that the impact 

there has been dramatic. Other sectors that have in fact come to 

life in greater measure because construction and transportation infrastructure has started that process. 

Mr. PORCARI. It is a very good question, ma’am. As you point out, 

the 1512 reporting requirement is unprecedented in transparency. 

It is the right way to do it. It was a learning curve, particularly 

for some of our smaller partners. For example, High Point, North 

Carolina, where you have one person who is doing the grants adVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00082 Fmt 6633 Sfmt 6633 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
11 

ministration, who is coding all this data, and has never been 

through all this before. We expect it will be much better the second 

time around with the next quarterly report. 

But I would also point out that is the most conservative measure 

of jobs. Those are the direct jobs only. Typically, in economic development you are measuring direct, indirect, and induced jobs. We 

know from specific projects, we know from the feedback from our 

State and local partners, that that is certainly happening around 

the country, that in the most true sense transportation investments 

are an enabler for economic development. 

It is just one example, if I may. As the Chairman mentioned earlier, when this bill was being considered and when it was passed, 

I was a State DOT Secretary, like my colleagues on the next panel. 

Knowing that we had to deliver projects and knowing how bad it 

was and people were hurting, we followed the progress of the bill 

every day. We met with the contractors and the contractors’ associations. We gave them a timeframe for when the work packages 

were coming out, asked them not to lay off people in the meantime, 

told them what the contract packages were likely to be, and even 

awarded contracts conditionally so that literally when the bill was 

passed they could rehire workers or, more importantly, not lay 

them off. 

I make that point because there has been some controversy over 

the ′′jobs saved′′ part of it. I can tell you from personal experience 

I know there were jobs saved because they knew the work was 

coming, they knew when it was coming, and they were clearly bidding the jobs just to make payroll. 

The kinds of projects you see around the country, especially the 

ones that are focused in economically distressed areas, clearly have 

the potential for creating economic development and the ripple of 

jobs beyond the direct construction. 

Ms. NORTON. With every construction project you have got suppliers, you have got design people, you have got all their office people. Somebody one day needs to do a chart that just shows how 

many people down the line come alive because of construction. 

One further question on training. Would you tell me this; you got 

your training fund out, as I recall, fairly rapidly. How is your training being done with the amount of funds you have, which obviously 

aren’t enough to cover every project and the need, how is that work 

being accomplished? Are you reaching groups that have been often 

excluded from the construction trades, like women and people of 

color? 

Mr. PORCARI. Yes, we are. This is an important part, as you point 

out, to make sure there are opportunities in the future, and also, 

as the workforce ages, to provide the workers of the future. The onthe-job training and supportive services program from 1998 to 

2009, first of all, has allocated over $65 million for this purpose. 

Within the Recovery Act, the $20 million that is specific to this, 

$8.2 million has been allocated to the States and the Bureau of Indian affairs in the first round. That is going directly toward the intended purpose of training for our historically underrepresented 

populations. 

These are good-paying, family-supporting jobs. Having the kind 

of training that enables you to compete for these jobs is one of the 

12 

missing elements. We think it has been very successful. We look 

forward to implementing the rest of that program. It is, I think, a 

guidepost for the future in many ways in making sure that we 

have trained, skilled workforce available. 

Ms. NORTON. Thank you very much. Mr. Chairman, I have a bill, 

a larger highway bill that would in fact use this experience to 

make sure the training occurs when you have that big bulk of 

money coming out of here as well to carry on what you have already started. 

Thank you, Mr. Chairman. 

Mr. OBERSTAR. Thank you for raising that issue and for your response, Mr. Porcari. Those funds double what we have in current 

law in the SAFETEA legislation, plus provide an additional $20 

million for bonding for minority business enterprises. And African 

American and Hispanic and women-owned enterprises have benefited from that provision in the bill, although only just under a million dollars has been allocated, because they have to request it. 

Those requests haven’t been forthcoming. 

Mr. Cao. 

Mr. CAO. Thank you very much, Mr. Chairman. Mr. Secretary, 

I was looking at some of the labor charts concerning Louisiana, and 

I have noticed that on a number of these charts Louisiana is ranking pretty low. If you were to look at the chart concerning, for example, percentage of allocated funds associated with project stages, 

highways and bridges, Louisiana ranks 42nd. 

Now can you clarify some of these numbers for me? How are 

these numbers being ranked and whether or not it is a Federal 

ranking or is it a State ranking or how are these numbers derived? 

Mr. PORCARI. Sir, I think the chart that you are referring to is 

data generated by the Committee and it is the percentage of allocated funds associated with each State. I would point out that each 

State has a slightly different strategy for implementing the Recovery Act, depending on local needs and depending also on things like 

the mix of projects. Smaller, shorter term projects are typically already out the door. The larger projects are just coming online. And 

then other issues such as construction season, where that does 

apply. 

I would also note that some of the States that even a few weeks 

ago we had some concerns about moving quickly, we have been 

working with, and they have, as we understand their strategy and 

their mix of projects, some of them have made considerable 

progress. 

Mr. CAO. Could I ask you for specific numbers with respect to 

how much money has been allocated to Louisiana for highways, 

how much for air, how much for rail? 

Mr. PORCARI. Yes, sir. For Louisiana, it is a total of $433 million. 

For the air portion, it is $18.5 million, the highway portion is $350 

million, and the transit portion is $58 million. In addition to that, 

we have a small shipyard grant with the Maritime Administration 

for $5.5 million. I will be happy to provide that to you in chart 

form, if it helps. 

Mr. CAO. Sure. I have noticed that there is a discrepancy between funds allocated and funds obligated. So, basically, under 

funds allocated, the DOT basically provides a certain amount of 

13 

funding for this particular State. However, I guess you are obligating the money as the projects are coming in. Is that how it 

works? 

Mr. PORCARI. It has been obligated as individual projects are 

identified and approved. If I could take that one step further, the 

difference between obligated projects and outlays is an important 

one because the obligations, I think, are the number we should all 

be looking at. That means the projects are committed to. In many 

cases, they are underway. The outlays lag because with our highway projects we work on a reimbursable basis. 

We want the work to be done and done correctly before we pay 

for it. So just as you wouldn’t—if you want to buy a new car, you 

pay for it when it is completed. Just as if you are building a house, 

you don’t hand a check up front for the total cost. You make 

progress payments. That is the way our reimbursable process 

works. We make sure that the work is done correctly, then we reimburse the States for it. So it is an important distinction because 

the work is under way, the people are employed, but we are not 

turning over Federal dollars as a reimbursement until we know we 

have a project that everyone can be proud of. 

Mr. CAO. So with respect to the States that are moving slowly, 

is Louisiana one of them? 

Mr. PORCARI. I would characterize Louisiana as one of the States 

that we are continuing to work with. Again, they all have individual strategies and very different needs. Our modal administrators and the Secretary and the entire team have been very directly 

involved in making sure that States have a viable strategy and are 

working quickly to get these projects out the door. Again, our yardstick more than anything else is, is the work under way, are the 

people employed. 

Mr. CAO. Mr. Chairman, I notice that I am out of time. Can you 

allow me just one more minute? 

Mr. OBERSTAR. One more question. 

Mr. CAO. One more question. Thank you very much. The Secretary was down in New Orleans I believe about 3 weeks ago and 

he made a commitment to light rail, I believe in the amount of— 

I can’t remember the exact number—but the City of New Orleans 

has a lot of streetcar projects and things of the sort. How much of 

the money that was committed by the Secretary would go into light 

rail projects like street cars? 

Mr. PORCARI. Sir, I don’t know that number offhand. What I 

would be happy to do is get that information to you and report it 

back to the committee. 

Mr. CAO. Thank you very you much. Thank you, Mr. Chairman. 

[The information follows:] 

14 


Insert offset folio 68 here 54019.068
15 

Mr. OBERSTAR. Indeed, the St. Charles line in New Orleans is 

the oldest street car and the oldest light rail, as we call it today, 

transit project in America, begun in 1853. 

Mr. CAO. It is one of the projects that serves as the heart and 

soul of the city. So we are hoping to have more projects like that. 

Mr. OBERSTAR. And I would like to supplement Mr. Porcari’s response, and that is all 50 DOT secretaries or commissioners were 

convened in Washington before the Recovery Act passed the House, 

and were counseled at our request, our Committee request, on 

what we expected of them; how we expected the projects to go out; 

what we intended by so-called shovel-ready, but projects ready to 

go through right-of-way acquisition, EIS-completed, final design 

and engineering. All they needed was the money to go to work and 

that we expected these projects to be under—in the House bill, to 

be under construction in 90 days or you lose the funds. That got 

watered down in conference to 120 days, obligated—it is a little different term from under contract—that is ′′obligated′′ as budget 

speak, but there was no excuse for any State DOT not to understand the purpose of this act. They have known it, they heard it 

from the Committee and Federal Highway Administration and 

from U.S. DOT, and the purpose of this accountability was to prod 

those who were laggers into taking action and getting themselves 

underway. And our monthly reports have had that effect. And to 

their great credit, the State DOTs have responded. 

I am going to reverse the order, we are going to alternate between senior and junior Member. So we will go to the most junior 

Member, Mr. Garamendi. 

Mr. GARAMENDI. That is an honor I had not expected, Mr. Chairman, but I do just want to compliment you. 

Mr. OBERSTAR. You are the only one who sat down there, in that 

front row down on the end where the Chairman doesn’t notice you. 

But I notice. 

Mr. GARAMENDI. Once again, I thank you. And I really look forward to working with you. I want to compliment you on your work 

here and particularly the extraordinary effort that has been made 

to hold accountable the States, having less than 35 days ago, 30, 

40 days ago now, been a State official. We know your lash has a 

sharp and heavy hit, but now that I am on this side, we have a 

different point of view. 

I think the question that I would like to really raise here is about 

the issue of ′′obligated′′ versus money actually out and the shovels, 

and the other equipment actually working, and the men and 

women working on those. How do you account for that and is the 

money just obligated or is it actually—are people actually being 

employed in projects underway? 

Mr. PORCARI. It is an important question because in this case, 

the term ′′obligation′′ means that there are projects identified and 

committed to; it also means projects underway, and there is a mix 

of that under the rubric of ′′obligated.′′ 

From a jobs perspective the important thing to realize is that 

′′obligation′′ is the trigger when contractors are looking and saying, 

I am not going to lay off additional people, or I may need to rehire 

or hire additional people to fulfill that contract, or even compete for 

16 

it. So the ′′obligation′′ trigger is really, in job retention and job creation terms, I think a very important milestone. 

We have the great advantage in delivering these projects in the 

bill, working within our existing—for the most part our existing 

mechanisms where we have these existing relationships with the 

States. This is how projects work at the State level on a reimbursable basis. The States are used to it and the contractors are used 

to it. 

So it is meant that the important part of this, getting projects 

underway, has happened very quickly. The outlays are a lagging 

indicator, because, as I mentioned before, we don’t reimburse the 

States until the work is either done, in the case of smaller projects, 

or we are making progress payments in the case of larger projects. 

That protects the Federal interest here. It is the best of both 

worlds in that we have the work going on and we know that we 

are going to get a good product at the end. So you know, again, just 

like buying a car, you wait until you have a product and then you 

pay for that. 

Mr. OBERSTAR. Would the gentleman yield? This is a very important point this is a reimbursement program. We have instituted 

the stimulus on the same basis as the regular surface transportation program. It is a reimbursement program. And the reimbursement is a lagging indicator. Jobs precede the budgetary effect. 

That is where Larry Summers is dead wrong; he just don’t understand this. I don’t know how many times I have to say it until he 

gets it. 

Thank you. 

Mr. GARAMENDI. Well, Mr. Chairman, maybe we can repeat that 

again. One of the issues that I know the States have, and certainly 

California does, is serious budget problems, so serious that the 

bonds that have been approved by the voters cannot be sold because we can’t—because the State can’t pay for those—the debt on 

the bonds. 

In the short term, could this thing be flipped so that the Federal 

money might come first and then the State money following as the 

economy begins to improve? I know that is exactly opposite of what 

the Chairman just said, but if we want to move things very quickly, we have got billions of dollars, bonds available but not sold. 

Mr. PORCARI. There is no easy way to do that, sir. It would be, 

I think very, in practical terms, very difficult to do that and get the 

projects we want. What we focused on is making sure the reimbursement process moves as quickly as possible. 

We do daily reimbursement. So literally when there is a valid invoice in, we can approve that reimbursement that same day. From 

a cash flow point of view that helps the States as much as possible. 

The other thing that I point out is the structure of the bill itself 

by providing 100 percent Federal money; and, again, having lived 

this as one of the State DOT secretaries. I know there are many, 

if not most States, that could not do these projects if they had to 

come up with a match. So I think the single biggest help we could 

be to the States was to have 100 percent Federal money to get the 

jobs and get the projects out there. 

Mr. GARAMENDI. Mr. Chairman, I yield my time. And I thank 

you for the courtesy and the opportunity. 

17 

Mr. OBERSTAR. Mr. Shuster—Ms. Fallin. 

Ms. FALLIN. Thank you, Mr. Chairman. And, Mr. Secretary, 

thank you for coming today. We appreciate your time and we appreciate the Chairman’s work on this very important issue of building up our infrastructure, our Nation. 

I had a couple of questions on the high-speed rail money and the 

TIGER Grants and how fast—I heard you say some of the money 

may come to the States in January, February. But how will you determine what the priorities will be throughout the Nation in individual States? I know in Oklahoma we applied for several TIGER 

Grants and we have some areas in Oklahoma, an area between 

Shawnee and Oklahoma City, where we have major companies that 

ship freight rail to Oklahoma City, but the track is so bad for 

freight that it is actually causing us huge time delays and job 

losses, and major manufacturers. 

I guess my question is how will you determine as an administration what States get—what portions of money and what the priorities will be when you award those TIGER Grants in the highspeed rail. 

Mr. PORCARI. First, for the TIGER Grants and the high-speed 

rail, we have moved up the timing so we are anticipating award 

of those projects—announcement of those projects at the end of 

January, which is about a month earlier than originally envisioned. 

We have a very intensive review process in both cases, for both 

TIGER and high-speed rail projects. These are discretionary grant 

programs. We are mindful of a number of factors, including geographic distribution. 

We do want to make sure, and knowing what we know at this 

point I am very confident that we have far more meritorious 

projects in both cases than we will have funding for. There has 

been an overwhelming response for both of those. 

We want to balance a number of things, including in the case of 

TIGER Grants, making sure that the kind of intermodal projects 

of regional and national significance that don’t have a built-in 

home in our existing programs, aren’t easily accommodated in 

those programs, are given strong consideration. The transportation 

network functions as a network and these intermodal connections 

are one of the weak spots, if you will. That is one important consideration. 

On high-speed rail we need to make sure that we have projects 

that can both move ahead quickly but also that can be the nucleus 

of what will be a network and that, at least in the long term, are 

not just stand-alone projects that would have independent utility 

but are part of a larger network. That is an important consideration for both of those. 

We have interdisciplinary review teams across the modal boundaries that are looking at the merits of those projects. I am highly 

encouraged by the review process so far, and we will work very 

hard to make sure that the strongest projects with the most merit 

that serve the country as well as possible are the awardees. 

Ms. FALLIN. I appreciate your answer, Mr. Secretary. But as you 

move through this process, I hope that you will keep in mind 

States like mine and Oklahoma where we have a lot of rural areas 

and where transportation, and especially freight transportation 

18 

through rail, is important; because, as you were talking about, 

looking at centers of economic activity that might lend to bigger 

States with bigger populations, with more transportation infrastructure than what a State like mine that is more rural would 

have. And while I may not be a center of hub activity economically, 

in some areas of my State I can tell you the one rail line that I 

mentioned, that it services many companies that have international connections, but it is in a rural area of Oklahoma that 

connects to our capital city. 

And if that rail, which is almost unusual because of water problems with a river that runs along the sides of the roads, the train 

tracks and the sodding, I guess you would say, the soil around that 

track, if that rail goes down that cost a community 500 to 1,000 

jobs. 

So part of the purpose of our stimulus package is to create jobs 

and to save jobs. So just as you look at the priorities and look at 

where you will be spending that money, that I hope that you will 

not overlook some of the smaller States and rural areas that do actually have jobs and need this kind of money. 

Mr. PORCARI. It is a very valid point. We are balancing all those 

things. It is a transportation network, and we tend to think about 

moving people sometimes more than goods. The economy doesn’t 

work unless we move goods efficiently as well. 

Ms. FALLIN. Thank you, Mr. Chairman, My time is up. Thank 

you very much. 

Mr. OBERSTAR. Thank you for that point. One of the many 

strengths of our authorization bill is that it has a very specific designation of funding for rural areas and farm-to-market roads and 

freight corridors to connect urban to rural, rural to urban. 

And also I should point out that in the base Recovery Act for 

highway and transit, the legislation directs, establishes a priority 

for funding for areas of highest unemployment, which are larger 

and rural areas. And we directed the Department to use the formula established by the Federal Economic Development Administration which rates county by county throughout the United States 

and establishes their own employment rate. And we do have a 

chart showing how those dollars have flowed, and they have gone 

to benefit rural areas and counties with highest unemployment 

rate. 

We also had language in the House-passed bill that required 

DOT and State DOTs to allocate their funds equitably throughout 

the State, so the money would not all be concentrated in one geographic area. Unfortunately, that was diluted by the wisdom of the 

other body. 

Ms. Johnson. 

Ms. JOHNSON OF TEXAS. Thank you very much, Mr. Chairman. 

Mr. Secretary, I would like to ask—the funds that were set aside 

or appropriated for highways were not designed, I guess, to get out 

very rapidly, because they use the same process. And we have that 

difficulty, not just with transportation in Texas, a State that does 

it the way they want to do it. Has that been a problem around the 

country or is it just unique to Texas? 

Mr. PORCARI. In general, ma’am, the process actually has worked 

very well. If the yardstick you are using is are projects underway, 

19 

are the jobs created or saved, some States have been more effective 

than others, and some States have been quicker out of the box. 

Those are typically the States that started with small, easy-to-bid, 

discrete projects. The States that had fewer but larger projects, 

some are in the $100, $200 and $300 million ranks for single 

projects, those have taken longer as you would expect. We are 

starting to see those come on line now. 

There is no uniform approach among the States and it really reflects individual needs and priorities because, remember, what the 

States are working from, especially with the highway projects, are 

a very large needs list that has been long established, and they are 

working off the top of that list and sometimes moving around within that list based on how quickly they can get the projects out the 

door. 

I think the final result has worked pretty well, because every 

State has met every time obligation in the bill for obligating funds. 

They have just picked different ways to do that. 

Ms. JOHNSON OF TEXAS. Also with the stimulus fund, there have 

been a number of cars purchased. Has that made a great impact 

for employment? 

Mr. PORCARI. Yes. Separately, the car allowance rebate system, 

what we all refer to as Cash for Clunkers, had a measurable positive effect on the gross domestic product. It clearly, if you ask dealers, manufacturers, consumers, made a difference exactly when it 

was needed. It was quite an interesting program on the administrative side because what we expected would take 3 months or 

longer, which is $1 billion worth of consumer activity, happened in 

5 days. That is some indication of how important it was. The environmental benefits we got from it, the shot in the arm to the economy, I think was a home run. And with that, we are very happy 

to be wrapping up the program. 

Ms. JOHNSON OF TEXAS. Thank you. I know you came down for 

one of the projects, which I thought was very appropriate. They 

had run out of money when they got to a small bridge, and they 

were able to complete it. 

Thank you very much and thank you, Mr. Chairman. 

Mr. OBERSTAR. Thank you. Mr. Diaz-Balart. 

Mr. DIAZ-BALART. Thank you, Mr. Chairman. May I put the 

Chairman on the spot when you recognized the newest Member of 

the Committee and you said we had all been there. Wasn’t it a couple of years ago since you have been in that front row? 

Mr. OBERSTAR. Well, it was just a couple of years ago. And I remember Mr. Jones was Chairman of the Committee and he gave 

all of us new Members 1 minute to say something. 

Mr. DIAZ-BALART. Just a few years ago. 

Mr. OBERSTAR. Just a few years ago. 

Mr. DIAZ-BALART. Thank you, Mr. Chairman. 

Two statements, Mr. Secretary. Thank you for being here. Just 

to put something in your ear. The Florida legislature just finished 

a special session this week to deal with, frankly, an initiative that 

had kind of dropped the ball on dealing with rail and high-speed 

rail. And I just want to make sure that you are aware of that and 

that you don’t disregard that very important step that was just 

taken by Florida, a State that was also invested heavily in 

20 

multimodal centers, et cetera. So I just wanted to make sure you 

are aware of that. 

Mr. PORCARI. I am, and thank you for bringing it up. We have 

been watching closely, and I appreciate the very positive step forward made by the legislature. 

Mr. DIAZ-BALART. Thank you, Mr. Secretary. 

Just a statement if I may, Mr. Chairman. I don’t want to say I— 

or, more particularly, you, Mr. Chairman, and this committee—I 

told you so, we all told you so. And nobody was more aggressive 

than the Chairman, Chairman Oberstar and the Ranking Member 

on trying to really maximize funds for infrastructure, as opposed 

to other things. Infrastructure funding, as we see from this administration, that is what emphasizes the success of the stimulus. 

Unfortunately, very little money went to infrastructure, and now 

we are seeing the results of where some of that money went. If the 

Chairman would have been listened to—and which is why he has 

had the support of this committee—I think we wouldn’t be seeing 

all the scandals, Mr. Chairman, that we are seeing and we are 

reading every single day now that we are seeing, again not dealing 

with transportation, Mr. Secretary. Part of the reason is because 

there is a well-established system, and part of the reason I think 

is because of the oversight of this Committee through the leadership of this Chairman. But we have seen other places, frankly, 

hundreds of millions of dollars of waste. 

Now we are seeing political consultants getting stimulus money. 

We see not it only nationally, but I have seen it locally in my community, political consultants are getting stimulus money, again, 

not meant for transportation. 

You know, if that happens in other countries we don’t call it 

waste. We call it outright graft and corruption. And that is what 

we are seeing with hundreds of millions of dollars that is not going 

to help people who have lost their jobs. And, again, if this happened in other countries, we would not call it waste. We would not 

have that political correct term that it is waste; it is cronyism and 

actual corruption. And we are seeing that widespread every single 

day from the so-called stimulus bill. 

Every day that goes by, we read another instance of fraud, corruption and waste, but where that has not happened is—at least 

not to the degree, not to that degree—is in transportation infrastructure. 

And Mr. Chairman, you know, I have said this before. We may 

have disagreements on specifics of the transportation bill, but 

where there is no disagreement is that it is a national priority and 

it must be a national priority. I just hope that this administration 

realizes some of the mistakes that have been made, realizes that 

transportation infrastructure is essential. And if we really want to 

have something that this Congress and this government can do to 

get the economy going, it is to pass the reauthorization bill that 

this Chairman has been working on for a long, long time, and stop 

postponing it and stop wasting time, and finally get serious about 

passing a real infrastructure reauthorization bill. 

This Committee through the leadership of this Chairman has 

shown that he is not willing to accept waste or fraud or abuse of 

the taxpayers’ money, and it is time to get serious and pass that 

21 

bill. I just hope the administration finally starts listening to this 

Chairman. 

Thank you, Mr. Chairman. 

Mr. OBERSTAR. I thank the gentleman, I will send that transcript 

over to the White House. 

Mr. Teague. 

Mr. TEAGUE. Yes, sir. Mr. Chairman, thank you for having this 

meeting today. And the one thing about talking later is people have 

said almost everything. But a couple of things that were brought 

up that I would like to know is, we talked about a lot of different 

terminology here, but which terminology, which words will tell us 

exactly when we have jobs on the ground and when we just have 

money allocated? 

And from listening to some of the other Members speak about 

things in their statement, we might want to address how we—you 

know, the way we have processed these funds before is give them 

to the States, and they process them the same way that they do 

their annual appropriations for roads and things like that. And if 

they are not going out properly and doing the jobs that we think 

should be done, being used for different things, maybe we need to 

look at a different way to allocate the funds. 

Mr. PORCARI. First in terms of terminology, sir, think about it as 

′′obligated′′ equals ′′jobs.′′ When the projects are obligated, that is 

when the job cycle begins. Where the jobs are either preserved or 

created, that is when you have a project that is identified. The obligated category also means projects that are actually underway. 

And as you know, we have over 7,000 projects underway around 

the country right now. 

So the distinction I was trying to make before is ′′obligated′′ is 

really when it matters in terms of both preserving and creating the 

jobs. The outlay part where we have actually reimbursed the States 

is the very end of the process. We reimburse. We don’t give Federal 

money to the States, for example, for a highway project, until we 

have a project that is built correctly and inspected. That is the 

process we use every day. It is the process that we are using in the 

Recovery Act. And honestly, it has served us very well. If we were 

to have a problem with an individual project, if it was inferior in 

some way, they wouldn’t get reimbursed. So I hope that answers 

that question. 

And again, I think one of the advantages of us delivering projects 

through this bill in the existing project delivery mechanisms is the 

State and local partners know how it works, they are used to it, 

they are used to the oversight and inspection that is required, they 

know they have to deliver a project before they get the Federal 

money. And all in all, I think it has worked very well. 

Mr. TEAGUE. So you think that probably using this process has 

expedited the approval and completion of start obligation outlay 

and all of the jobs. 

Mr. PORCARI. Absolutely, sir, I do. I am speaking both as the 

deputy secretary, but also in the early days of this bill as one of 

the people delivering projects as a State DOT secretary. You know 

how it works, you know where your projects are. If you are hustling 

and you have teed-up the projects, you can literally flip a switch 

22 

and start the work as soon as the bill was signed. And that is exactly what we did. 

Mr. OBERSTAR. Mr. Shuster. 

Mr. SHUSTER. Yes, thank you very much. 

Thank you, Mr. Secretary, for being here today. It seems like 

every month you and I run into each other somewhere. 

I want to first of all echo the remarks of the gentleman from 

Florida on transportation spending and stimulus money. I believe, 

as many of us, maybe every one of us on this Committee believe 

that a larger portion of stimulus dollars should have gone into 

transportation infrastructure funding. And I think we would have 

seen a greater return than we have. And, of course, there are a lot 

of questions out there as to what really is the return, what are the 

jobs. It is a very difficult thing to measure. 

But, again, I really wish we would have focused—and maybe it 

is not too late, some of those dollars that are still out there, take 

them and turn them into transportation infrastructure dollars and 

get them to work for America, because it is critical to this country. 

It is 11:30 in the morning an I look out here, and every person 

in this room has been affected in a positive way by the transportation system of this country. Everybody got here somehow. This 

water got to me on a truck and was brought into the Committee 

room. As we go about our day, every interaction that we have as 

a purchaser, or getting to and from, we come in contact with the 

transportation system. Everybody, all 320 million people in America, have that same impact every single day, and I think we need 

to focus more on that and the benefits, the long-term benefits that 

it brings to the country. 

Concerning the Department of Transportation’s—we were talking 

about the jobs and it has been quite controversial as to how we are 

recording it and what the process is. Do you have a standard at 

DOT that you put out to the States that they are responding in a 

uniformed way across the 54 States to ensure that we are getting 

accurate reporting? I have looked at some of the Committee documents and some of DOT. And obviously they are slicing it different 

ways. But what are we doing to ensure that we are getting accurate figures from the States? 

Mr. PORCARI. Well, first, sir, the States are used to the DOT definition of job reporting, and I think are very comfortable in continuing to put together those numbers. There are a couple of separate reporting requirements and that is, quite frankly, part of the 

confusion here. The most strict definition is the section 1512 reporting requirements in the recovery bill, which are just direct jobs. 

And that is reporting from the recipients directly to the Recovery 

Accountability and Transparency Board. Those are the recipients 

putting together the numbers themselves. And that is where the 

45,000 job number to date comes from. 

Because it is only direct jobs, the most conservative measure. Because it is the first time that those jobs were reported that way, 

there were some errors by the recipients. We had one State, for example, that reported the correct numbers but miscoded it, and 

these came out as Veterans Administration projects. We have since 

corrected that. 

23 

We have also had recipients that weren’t States but very small 

entities—transit, for example—that are not used to reporting, who 

have made some errors, and we have been working with them 

throughout this process individually to try to get them up the 

learning curve on that. I think that has actually been largely successful. 

Mr. SHUSTER. When you say ′′direct jobs,′′ do you have a way to 

determine if we are talking about a job for a month or are we talking about a job that lasts 6 months or 6 years? That is a concern 

of a lot of what we are seeing out there across the board in stimulus, but even in transportation spending these are not long-term 

jobs, these are—they are out there for a month or 2 months and 

then they go away. 

Mr. PORCARI. For the recovery part of the Recovery and Reinvestment Act, getting jobs out there right away is the priority. It is 

clear that these projects did it. The reporting is by jobs. You could 

also do it by hours. There are lots of different ways they could actually be structured, but what you are seeing in that particular reporting is a snapshot picture based on the reporting deadline. 

Mr. SHUSTER. And would it be your view that having a long-term 

highway bill would have a much greater impact on the economy, 

on the industry, than this short-term infusion of cash? 

Mr. PORCARI. We do know that a consistent and predictable longterm funding program for transportation is critical. My State colleagues, for example, as they have large, multiyear, very expensive 

projects, you need that kind of consistency and predictability. 

Mr. SHUSTER. It ripples through the economy. I think as you will 

hear later, as a highway contractor aggregate company is going to 

testify here, and my discussions with them, is they are not making 

the long-term investments because they are not sure what is coming down the road as far as funding. 

So I hope that you and the administration are making those arguments to the President and to OMB that it is critical we have 

a long-term bill here that will be positive for this country. 

So thank you, Mr. Chairman, I yield back. 

Mr. OBERSTAR. Thank you, Mr. Shuster. I completely agree and 

I am delighted to have the support of your side and our side. We 

don’t have a side in this committee; we are all together. We need 

the long-term authorization bill. And I am glad the Secretary is 

traveling around the country getting ideas. You can start right 

here. 

But our Committee printout, Mr. Shuster, does provide for every 

State, right down to total job hours created or sustained. Every 

Member has received a copy of this. In Pennsylvania, it is 

1,393,411 hours of work in the Clean Water Revolving Fund, Fixed 

Guideway Highway Infrastructure, and Transit Capital Assistance. 

Mr. SHUSTER. I have it. 

Mr. OBERSTAR. You have got it right there, good. I just have to 

say it again: This is the only Committee that is doing this kind of 

accounting. 

Mr. OBERSTAR. Ms. Titus. 

Ms. TITUS. Thank you, Mr. Chairman. 

Now, coming from Las Vegas, I thought I had seen everything. 

But I continue to be amazed when people who voted against the 

24 

stimulus complain that they are not getting enough money and 

they aren’t getting it fast enough. But aside from that, Mr. Secretary, I appreciate the fact that you have been working with the 

States. I don’t mean to beat a dead horse, but Nevada keeps coming in 48, 47, in terms of these lists that we have and getting the 

money out and getting the projects underway. 

The work that you have been doing with the different States, 

maybe you could tell us, are there any additional tools that you 

need that we could provide for you? And if we do, more money for 

these kind of projects that would make it work faster, especially in 

States like Nevada that have such high unemployment rates. 

Second, have you identified any best practices as you met with 

these States that could be used by the rest of us to do better? 

And third, sometimes it is the politics of a State that hold up the 

process. Our Governor, for example, refuses to put up signs that 

say, ′′This project was funded by recovery dollars.′′ So have you 

thought about giving more money directly to like the regional 

transportation commissions or the local government instead of just 

through the States? 

Mr. PORCARI. Well, first, we are using the mechanisms specified 

in the bill to get the projects out the door. We have been working 

individually with States to do this. In fairness to the States I would 

point out that they also have different requirements. Some of them 

were required to operate under pretty extensive consultation and 

approval processes, sometimes at different levels of State and local 

government, before they could actually have a project list that they 

would submit for recovery projects. Others had worked that out in 

advance, and that does account for some of the difference. 

From Secretary LaHood on down, we have been working individually with States, where necessary, trying to make sure we have 

strategies that help get these projects out the door. 

We have, through our division administrators in Federal Highways, through our regional administrators in Federal Transit just 

to mention two examples, we have individuals who are actually 

highly skilled at work, and have the working relationship with the 

individual States to get those projects going. 

The intent in terms of jobs was really to make sure we had a 

continuum of jobs, we got projects underway quickly, we are creating jobs quickly, but also sustaining that over an 18-month or 

longer period. And what you are seeing now in some ways is the 

second stage of the rocket, where the early projects are actually 

mostly completed, and the larger more complex projects, as we get 

into the second stage of the rocket here, they are underway now, 

or will be shortly. 

Ms. TITUS. I guess as we talk about a jobs bill that we are hoping 

to get out now in the next couple of weeks, or early in the new 

year, with more dollars to infrastructure, are there ways that we 

can do it better in the next cycle is what I was looking for. 

And, really quickly, your comments earlier about the super— 

high-speed rail that you said you build up, you don’t start at 120 

or 200 miles an hour, does that mean that the Maglev project that 

has been proposed from Las Vegas to Southern California is out of 

the running? 

25 

Mr. PORCARI. No. And I didn’t mean to infer that any individual 

project was out of the running. What I was trying to characterize 

is that there are different states of readiness for different projects. 

There are some places where there is right-of-way that can support 

high-speed rail today at 110 miles an hour and want to build up 

from there. There are others that don’t have the dedicated rightof-way or shared right-of-way that would allow high-speed rail. We 

have a little bit of everything in terms of potential projects out 

there, but we are certainly not ruling out any potential projects. 

To your earlier point, it is a very valid one. There are best practices out there, and certainly lessons that we have learned from 

this. And we have tried to take those to heart, whether it is 

through additional work like this or whether it is through just the 

day-to-day project delivery mechanism. One of the things that the 

Recovery Act has really shown is that when there is—when we are 

really working in partnership, when we feel that sense of urgency— and we certainly do feel that sense of urgency—we can get 

those projects underway. 

Ms. TITUS. Thank you. Thank you, Mr. Chairman. 

Mr. OBERSTAR. I thank the gentlewoman. I just want to point out 

Nevada has consistently ranked in the lowest tier. But now they 

have reached the point of the lowest four. And, characteristically, 

each month I have joined Mr. DeFazio, sending a letter to the Governor of the lowest-ranking States, asking for an explanation and 

reminding him of the language of the bill which says projects that 

are ready to be under construction—not the ones that are going to 

take 6 or 10 years that you need 3 years to think about—the ones 

that can put people to work the quickest. So we will get on it. 

Mr. Larsen, you are next. 

Mr. LARSEN. Thank you, Mr. Chairman. I have to say when you 

announced your policy of going highest to lowest, I turned to my 

colleague from New York, Mr. Arcuri, and reminded him this is 

what it is like to be a middle child. So wait your turn. 

Anyway, just a few points. If I could enter for the record a stimulus newsletter from the State Department of Transportation in 

Washington State, outlining up-to-date numbers for Washington 

State, including over 1 million hours on the State Department of 

Transportation projects alone, since February, with people earning 

about $40 million from working on those specific projects. 

And it goes through a variety of other statistics our State DOT 

is tracking to be sure that we are doing our job. So I will just enter 

that December 2, 2009 newsletter into the record as an example of 

how one State is watching its own self as we are moving forward. 

[The information follows:] 

26 


Insert offset folio 69 here 54019.069
27 


Insert offset folio 70 here 54019.070
28 


Insert offset folio 71 here 54019.071
29 


Insert offset folio 72 here 54019.072
30 


Insert offset folio 73 here 54019.073
31 

Mr. LARSEN. This talk about numbers, accounting numbers, Mr. 

Porcari, it is important. And note on the next panel, the GAO will 

testify on transit, in addition to some other things, but on transit. 

And one of their conclusions is that some State transit officials and 

bus manufacturers are using different criteria to measure job creation and retention. And you testified earlier that in fact there was 

some consistency in counting job creation and job sustainment. So 

GAO is finding something different, at least when it comes to transit. 

Can you address that discrepancy for me and help me understand that? And, second, help us understand what you are doing 

to address that concern. 

Mr. PORCARI. As to the first part, I am at a little bit of a disadvantage here. I haven’t seen the GAO reports. I am not sure 

what the specific findings are. But we have been working with individual recipients on the job reporting, both through the section 

1512 requirements and what are typically multiple reporting requirements for most transit agencies. We are doing that on an ongoing basis. In fairness to some of the transit properties, it is a new 

process for them. We will continue to refine it, and if there are individual issues that we need to address, we are committed to addressing that. Because I think an important part of the delivering 

here is delivering the projects, but also the credibility that comes 

with doing this right. 

Mr. LARSEN. I agree the credibility is dependent. And it is important, this discussion we had earlier about what is obligation, what 

is appropriated, what is allocated. I understand those distinctions 

are important, but the credibility is really on who is working and 

who is not working, because that is honestly what we care about 

seeing someone work, which is why a lot of us voted for the Recovery Act. 

I will just note as well for Members, other Members have done 

this, I have visited about 19 or 20 separate recovery projects in my 

district, not all of them transportation, but half of them transportation. It is important to go see these not only because we can kind 

of work as our own watchdogs in our own districts, but also there 

are critics out there of the votes we have taken in the past Recovery Act. I would encourage Members to go visit those recovery 

projects in the district and make your own assessments and not 

read—we can read all the reports in the world, written by folks 

who have never been to my area of the country, probably think 

Washington is still this area. But in fact if they go out there and 

see these projects in place, see people working, and see a half mile 

of new road, with new sidewalks that makes it safe for kids to walk 

to school from the local neighborhood, they will have a better understanding of how these Recovery Act dollars are working. 

I just wanted to ask that question about the job numbers with 

regard to transit because there does seem to be some discrepancy. 

Finally on the FRA applications, is there a timeline on track 1 

and track 2? 

Mr. PORCARI. Yes. The current thinking, we anticipate awarding 

or announcing all of the awards, track 1 and track 2 and others, 

at the end of January. 

Mr. LARSEN. At the end of January. 

32 

Mr. PORCARI. Yes, which is ahead of the overall schedule planned 

before. 

Mr. LARSEN. Okay, thank you. Thank you, Mr. Chairman. 

Mr. OBERSTAR. Thank you, Mr. Larsen. We have time—11 minutes remaining on this vote. Mr. Hare. 

Mr. Secretary, by the way, do you have a time limit? 

Mr. PORCARI. I am at the committee’s—— 

Mr. OBERSTAR. We have three votes coming up. 

Mr. HARE. Thank you, Mr. Chairman. Just for the record, I understand you were awarded the Player of the Week Award in the 

magazine, one of the magazines the other day. I would like to suggest that he should have been Player of the Year. You have been 

tenacious since we started this session on getting the highway bill 

and getting people back to work. And, you know, I want to thank 

you on behalf of all the people who have gone to work and those 

who who are going to go to work. You have never backed off an 

inch and I appreciate that. 

Mr. Secretary, you might have mentioned this, but for passenger 

rail, not high-speed rail, but for passenger rail we have, since my 

colleagues have talked about a couple of their projects I would get 

in trouble if I didn’t mention mine. We have one going from Rock 

Island or Moline to Chicago, passenger rail. And I was wondering 

if those figures that come out or those announcements that come 

out, is that part of the—is that on the high-speed rail project? 

Mr. PORCARI. The overall category for high-speed rail includes 

other tracks that are—some of them are shorter term upgrades 

than others. The whole package of improvements, both distinct 

high-speed rail projects and others, including some planning and 

design work, we anticipate being announced at the end of January. 

Mr. HARE. Because that would be 800 long-term sustainable jobs. 

So I would hope that we would be in the hunt there. You also mentioned the TIGER Grants. I think those are wonderful. I have a 

city in the southernmost part of my district, Quincy, right on the 

river, that is applying for a TIGER Grant. And my understanding 

is that would be hundreds of jobs for that community. So I think 

that is a great program. I talked to the Secretary about both of 

those. I think that is what we are here for, to try to get something 

done. 

I just want to ask one quick question. I know we have votes. 

There have been some critics of the Recovery Act that have complained about red tape that hinders the quick and efficient use of 

the funds. Have you found this to be factual? 

Mr. PORCARI. No, I have not. In fact, to the contrary, because it 

is the same process that we have used for years for projects, where 

our State and local partners know the process and know what is 

required. That kind of consistency and predictability has actually 

been helpful to them, I think, in knowing how to get projects done. 

Mr. HARE. And then just the last one. You talked about in your 

testimony that the Recovery Act funding for transit has resulted in 

the purchase of almost 11,000 new vehicles. What is the impact of 

this investment, not only to the state of the transits but also on the 

supply chain that produces these buses? 

Mr. PORCARI. It is a very good question because, obviously, the 

transit agencies benefit from that rolling stock, the buses or rail veVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00104 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
33 

hicles. But the manufacturing part of it—and there is a Buy America provision, of course, within this—has been a substantial boost 

as well. 

And, finally, I would note, going forward in high-speed rail, from 

the beginning Secretary LaHood has put a strong emphasis on the 

American manufacturing capability and potential for this. So as we 

get to the other parts of the Recovery Act, beyond the transit vehicles you mentioned, we have been delivering a clear, unequivocal 

message of our expectations for a durable, broad, and top-to-bottom 

American-based manufacturing capability for high-speed rail. 

Mr. HARE. I appreciate that. Thank you, Mr. Secretary. 

Mr. OBERSTAR. Thank you, Mr. Hare. Ms. Hirono. 

Ms. HIRONO. Thank you, Mr. Chairman. This Committee has 

been a model for keeping track of what is going on with our money 

in our area of jurisdiction. So, Mr. Chairman, I know that it has 

not escaped your notice that on one of these charts that you provided, the State of Hawaii is number 50, but I do want you to know 

that, as the Secretary mentioned, the States are pursuing individual strategies and we have far less of a percentage, for example, 

on resurfacing projects. And the Federal Highway Administration 

just okayed a project which will probably put our State in the 87 

percentile ranking, so I wanted to let you know that. 

Mr. Secretary, in the GAO testimony it was noted that there are 

many States that are awarding contracts for less than the original 

cost of the project. Are you making note of that? And is this something that we need to provide maybe a little more time for the 

States to obligate—reobligate these funds? That is my first question. 

The second question regarding the purchasing of all these buses, 

as we try to promote intermodal transportation. For example, I represent a rural area, as do many of us. Buses is the way that they 

are going to provide transit for their people. And so is this an area 

allowing or providing the opportunity for these rural areas to purchase more buses? Isn’t that something that we ought to be paying 

more attention to as we reauthorize the transportation bill? 

Mr. PORCARI. First, on the reobligation, it is a great point because many of the contracts have been coming in under engineers’ 

estimates. That is obviously good news. That money, the savings 

get recycled and put into additional projects. We believe that the 

recipients can still add these additional projects within the time 

frames that are in the bill. 

One of things you are seeing, for example, involves the aviation portion of this at $1.1 billion. We have been at about 99 percent 

completion for a month or two now, because the savings appeal— 

we keep adding projects to it. Again, that is good news, but I think 

we can all work within the time frame of the bill. 

The issue on buses in rural areas, clearly transit has a lot of dimensions. One important one is it is literally a life line in our rural 

areas. It is connecting people with jobs, it is connecting seniors 

with needed services and opportunities. 

Ms. HIRONO. Definitely the case in my State. 

Mr. PORCARI. We are mindful of that as the transit systems 

throughout the country all have really different strategies in many 

cases for what kind of service they are trying to provide; and for 

34 

the most part, they have the discretion to pursue the strategy that 

best serves their customers. 

Ms. HIRONO. Well, for a place like Maui, for example, they have 

the highest bus ridership in the whole country, I am told. They 

only have buses; there are no other mass transit modes. So I am 

thinking perhaps we should provide more funding for buses in 

these kinds of areas, because they don’t have very many other options, frankly, besides the individual cars. 

Mr. PORCARI. We do know there is far more transit need out 

there than we presently fund. 

Ms. HIRONO. Thank you. Thank you, Mr. Chairman. 

Mr. OBERSTAR. We will recess for the three votes, and when we 

resume it will be Ms. Richardson and Mr. Arcuri, and, following 

them, other Members who return who may have follow-up questions. Because there were questions asked about TIGER Grants 

that supplement the previous comments, that the equitable distribution language does apply to the TIGER Grant Program, and 

I am sure the Secretary has that in mind as they go through this. 

Mr. PORCARI. Absolutely. 

Mr. OBERSTAR. The Committee stands in recess. 

[Recess.] 

Mr. OBERSTAR. When the Committee rose, Ms. Richardson was 

next in line for opportunity to question. The gentlewoman from 

California is now recognized. I must also add that the gentlewoman 

led a delegation to Afghanistan. I don’t expect you to report on that 

here, but she ismultitasking. We thank you for your vigilance in 

Afghanistan as well as here in the committee. 

Ms. RICHARDSON. In fact, I made sure to look at Highway 4, 

which is a very big road and highway in Afghanistan, so I did our 

transportation work while we were there. 

Deputy Secretary, let me first of all say I want to commend you 

for the record. You have actually been to my district, and listening 

to some of our colleagues, it sounds like you have been a lot of 

places. That is all we can ask as Members is to have the various 

administrators engaged, knowing the district, having the knowledge to make good decisions. So I, first of all, want to commend you 

for that. 

Number two, what I would like to talk a little bit about, Mr. 

Chairman, when we first talked about the stimulus money, one of 

the things we said that was so important is that if we had all this 

money, we needed to make sure that not only were we doing 

projects on paving roads and all that, but somehow we were creating some networks that would make sense, and we would also 

deal with the unemployment at hand. 

I have a couple questions for you. We pulled up theFHWA Supplemental Guidance on the Determination of Economically Distressed Areas, and in section 301(a)(1) and (2), it talks about the 

guidance is based upon 80 percent of the national average in terms 

of per capita income, and then it says 1 percentage point over the 

nationwide unemployment rate. But then later it talks about— 

there is a third section. It says, if a State feels that an area or a 

project meets some of these other criteria, business closure, threatening businesses and so on, that it could qualify under a distressed 

area section. 

35 

What I would like to respectfully request for this Committee is 

that in the document it says that the State should be able to provide information as to how the State identified, vetted, examined 

projects located in economically distressed areas, and how the State 

selected projects based upon the priorities, preferences, conditions, 

and requirements of the Recovery Act. 

So, for starters, I would like to ask for the State of California, 

and then, of course, all of the States, for us to receive this information. How did they determine that the project was in a distressed 

area, and which section did it apply to? Did it apply to the economic per capita income, did it apply because it was of the unemployment, or did it apply to all these other ′′also rans′′? Because it 

if applied a lot of these projects to the ′′also ran′′ category—and 

now I am using a horse metaphor—we really maybe have not completely solved some of the problems that we were hoping to achieve 

through the stimulus money. 

Let me give you an example of what I mean by that. You have 

been to my district. I don’t think there are many districts that can 

compete in terms of total transportation: ports, airports, highways, 

roads, bridges, on and on and on, and yet when you look at the allocations, which I am very well aware that you don’t determine, but 

what I would hope is that you would work with the various State 

DOTs to ensure that the hard work this Committee made to make 

sure this was done right, that it, in fact, is happening. So, for example, if you were to just look at the $44.6 billion and 

divide them out by 439 districts, if you were looking at just straight 

equitable, it would be $102 million. That didn’t happen. If you look 

at, as some of the Members talked about, districts that have very 

serious transportation needs, that didn’t happen. I am not here— 

one of the things my Chairman has taught me, I am not here to 

embarrass any other Members, but I will supply you with the information that shows it wasn’t even done based on that. 

So what I am hoping is with the remainder of the money we 

have that you will be able to work with the various States to ensure the things we hope to have achieved, which was the most critical networks, meeting the distressed area requirements, that the 

remaining money that we have maximizes in that effort, so moving 

forward and not crying about the spilled milk of what happened in 

the past. 

I just wanted to give you an opportunity to respond to that. 

Mr. PORCARI. Thank you, Congresswoman. 

This is a really important part of the Recovery Act, the focus on 

economically distressed areas, and the aggregate nationwide number, economically distressed areas nationwide are 39 percent of the 

population. But of the projects nationwide, 57 percent of the highway projects and 60 percent of projects overall have been in economically distressed areas, and that is the Commerce Department 

definition. That emphasis has been there. 

I will tell you that Secretary LaHood personally has been stressing that both in written and verbal communications with the 

States, something that we have been very focused on. Where we 

have had discretionary grants, admittedly on a smaller scale, but 

the small shipyard grants, for example, because that was part of 

the criteria, we made it a very heavily weighted part of the criteria 

36 

for the small shipyard grants, where we had that discretion, knowing that the jobs are doubly important in those economically distressed areas. 

We will be happy to get the information together for the Committee on the States and in this case California’s individual efforts 

within economically distressed areas and how that has worked. 

Going forward, it will continue to be an emphasis of ours, as it has 

been from the beginning. 

Ms. RICHARDSON. Mr. Chairman, my time has expired. Could I 

follow up? 

Mr. OBERSTAR. The gentlewoman has been patient coming back 

and participating, so the gentlewoman may indeed continue, but I 

will ask her to yield for a moment on thisEDA issue. 

This was one of my contributions to the whole stimulus, among 

many. I insisted that the House language—and it survived conference—include a directive to the Department to allocate their 

funds by the EDA formula.EDA has a well-established set of criteria by which it measures economic distress in the rural counties, 

in urban centers, and in parts of urban centers, even down into 

neighborhoods. The O Street Market project, for example, in Washington, D.C., was an example of a microtargeted project. This was 

several years ago. 

And then we asked also Federal Highway and DOT to report to 

us on the percentage of projects that are in EDA areas, percentage 

of funds obligated, and then the population of the State. California, 

99 percent of the projects, the highway projects, went to EDA-designated distress areas. Ninety-nine percent of the funds obligated 

so far have gone to EDA-designated stress areas. 

If there are some discrepancies the gentlewoman has, I want to 

know about it. Bring them here or bring them to my attention, and 

we will get on this. We will correct it. I know the Department will 

be totally participatory in this matter as well. 

Ms. RICHARDSON. Yes, Mr. Chairman. You are exactly right of 

the report that you referenced. My question, though, was delving 

deeper. The report reflects that, yes, the majority of these projects 

have been in EDA areas. But if you read the criteria in the EDA, 

there are three different sections. And so what I am asking is that 

the report would reflect are the EDA areas because it is 80 percent 

of the income per capita; or is it EDA because it is, in fact, only 

1 percentage point higher than unemployment; or is it, in fact, 

EDA, which I think we are going to find when we get this report, 

that a lot of it is because it is business closures, threatened business closures, military base closures, which some might argue, and 

I might once we see this information, that some of the criteria, one, 

two, or three—I would argue that one and two better meets why 

you put this language in here in the beginning. I don’t think we 

intended that category 3 would be the majority of how those 

projects were selected. 

Mr. OBERSTAR. What I wanted so that there be clarity and simplicity and not arguable is to follow existing law. It is the simplest, 

the cleanest way. It is a known quantity, a known commodity. 

There is a practice. And then we leave it to the State to make these 

determinations. But these are the criteria that they can follow. It 

37 

may be possible for States to subdivide that information, and we 

will pursue that. 

Ms. RICHARDSON. Thank you, sir. It does say in their guidance 

that the States should be able to provide that information. So we 

are simply asking for that. 

The last question I would ask is the other big piece, this whole 

thing about the stimulus was: How many jobs? Several Members 

asked you questions, and you answered the question of 46,400 direct jobs is what your testimony references. 

When we had our last meeting, which I believe was on October 

1, we asked the question: Could you differentiate between how 

many of these were actually new jobs, and how many were people 

who already had contracts and they were able to maintain their 

jobs? If you look at all the language having to do with the stimulus, 

it was we maintained or created jobs. I am curious in your section 

1512, does it differentiate between who was able to keep a job and 

who it was really a new person who was unemployed? I think the 

example that you gave in your testimony, can we differentiate between those two? 

Mr. PORCARI. Ma’am, the 1512 reporting doesn’t differentiate between retained or created. Again, those are just direct jobs in that 

one. 

Ms. RICHARDSON. And so, Mr. Chairman, I would suggest that 

when you look at one of the biggest arguments that we are getting 

beat up in the public because we still have a high unemployment 

rate is: Has, in fact, the stimulus really dealt when that unemployment rate and got new people hired? So maybe we can explore 

when this is done really understanding are these new jobs or not? 

Mr. OBERSTAR. If the gentlewoman would yield. 

Ms. RICHARDSON. Yes, sir. 

Mr. OBERSTAR. We asked, through AASHTO to all the State 

DOTs and through Federal Highway DOT, whether that distinction 

could be made in the reporting. Many came back and said it would 

be very, very difficult, verytime-consuming to do that, to make that 

kind of report. I think that is something we may want to pursue 

with the next panel, with GAO, and how we can simplify and make 

it less complicated for them. 

I can say that my experience, and at least traveling to half a 

dozen States, is that most contractors had their workers on layoff, 

called them back. And even those who had most of their people, the 

ones that were still on payroll were at reduced hours; 30 hours, 32 

hours, 25 hours. It varies from contractor to contractor, keeping 

them on thepayroll so they could retain their health insurance benefits. Sand and gravel pits, cement producers had total layoffs. 

That was a complete recall. 

I would ask GAO who are in the audience to think about how 

they can help us simplify a reporting process that could provide 

that level of detail. 

What the gentlewoman is referring to, though, the criticism is 

coming from other portions of the stimulus. How can you account 

for teachers retained rather than teachersrehired; police retained, 

not laid off; firefighters not laid off because they got stimulus 

funds? I don’t know. That is up to States. It is not within our jurisdiction. 

38 

I do know this: These hours at the end of the last column of this 

long 14-inch report column has total job hours created or sustained. 

In California, that is 3.8 million job hours. Breaking that down to 

how many of those were new jobs or how many of those were 32 

hours and went to a 40-hour week, that might be a lit bit of an 

accounting stretch. But we know that number is real, and that 

number is there for every State. 

Ms. RICHARDSON. Reclaiming my time, sir, your generous use of 

my time. The reason why this point is important, first of all, I am 

thankful for all the jobs we have been able to maintain. That was 

critical. I agree with everything you laid out. But in districts like 

mine, where we already had unemployment already exceeding 12 

percent before this whole thing happened, for us to justify to those 

constituents, at some point those unemployed need to be able to 

figure out how we can get them employed, too, and not just the 

people who already had a job, who are now—they are protected, 

and they still have their job for another year. But the ultimate 

goal, if we are going to keep spending this money, is we have also 

got to figure out how to get some of those unemployed people who 

have been unemployed, bringing them to the rolls as well. 

I look forward to working with you. It is possible if we get a new 

jobs bill, that I know you are working so hard for, that we can ensure, if not for this language as we go forward, that we can differentiate, because it is a very key point in terms of people who are 

working. 

Thank you, sir. You have been gracious. 

Mr. OBERSTAR. Mr. Porcari, you respond now. 

Mr. PORCARI. First of all, both are important jobs, retained and 

created. We are very open in our thinking about lessons learned 

from the Recovery Act, going forward: Are there more sophisticated 

ways to capture the data? As the recipients get better at reporting, 

are there ways that we can continue to do this in the future? 

I would put it under the category of lessons learned. And we do 

understand that where we have the ability to do so, we should 

make every attempt to make that case, because the lesson that I 

am taking from this is that people are seeing both projects and employment, and to the extent that we can reinforce both of those 

very directly and see the direct benefits, it bodes well for transportation and infrastructure. 

Mr. OBERSTAR. I think the point Ms. Richardson is making is a 

very important one. I know many of our colleagues are getting the 

same questions. And, of course, the naysayers are all too ready to 

carp and complain and say, well, those were jobs that are already 

there, you are just putting them on the job for another 8 hours a 

week. 

Well, you try that. You go out and work 32 hours and get a reduced paycheck. Isn’t it a bonus to get another 8 hours? If your 

shirt size is 16, and they sell you a size 15-1/2, you can’t button 

that top collar. It is the same thing here. That boosting up to a full 

40-hour week and then, in many cases, assuring that you get full 

benefits and your retirement and your health insurance, that is a 

big deal. Documenting it is something that we really should make 

an effort to do. 

Ms. Richardson, do you have anything else? 

39 

Ms. RICHARDSON. Thank you, sir. It has been a pleasure. I only 

wish all of the agencies that had thishard-earned money had operated it as you have in this Department. 

Mr. OBERSTAR. I just wish we had $500 billion of stimulus in our 

program. We would have 2- or 3 million people working. 

Ms. RICHARDSON. You would have my vote for that. 

Mr. OBERSTAR. Mr. Porcari, has DOT—not you specifically—DOT 

done—and I want AASHTO to be thinking about this as well—a 

survey of contractors to see what their capacity is? In addition too, 

we have the regular 80-20 program, as I call it, the SAFETEA, 

which is still under way, 15 States are not able to provide their full 

20 percent match, or not able to match, or a bonding to cover their 

match. Now we have the stimulus on top of that. Bids are coming 

in at 25 percent, on average, below final design engineering estimates. I know that was the case in California. Then-Commissioner 

Will Kempton was the first one to report that they are getting this 

windfall bonus. Other States reported the same. 

What is the capacity now of the industry to absorb additional recovery funds if we have a follow-on second-stage stimulus? 

Mr. PORCARI. First, I don’t know that we have done a specific 

study of this, but I can tell you from conversations with State DOT 

secretaries, other transportation colleagues, and hearing a lot from 

the industry the kinds of things that you pointed out, for example, 

that the pricing is still coming in, in many cases, below engineers’ 

estimate, is a pretty solid indicator that there is unused capacity 

out there. I know that there are States, for example, that are in 

the middle of a very difficult decision of laying off either part of 

their engineering staff or not making their Federal aid match, another indication that overall there is much more capacity both on 

the public and in the industry side. 

The sense I get is that there is a lot of satisfaction and acknowledgment that the Recovery Act for transportation has really 

worked as designed, but keeping the momentum going is something 

we are all focused on, and knowing that from a nationwide perspective that this is a fraction of our total infrastructure needs, it is 

clear that there is both a need for projects out there and, I believe, 

capacity out there to get it done. 

Mr. OBERSTAR. I believe there is substantial capacity. Associated 

General Contractors did a survey of their top 400 companies, who 

reported that they anticipate layoffs of as much as 40 percent this 

coming spring when stimulus winds down and when additional 

States are not able to provide their 20 percent match, and we actually see another meltdown in the economy. Not only is there a capacity now, there is going to be more capacity. 

I would expect, and I would like to get your take on this, by May 

we may have in the range of 1,000 highway, bridge, transit projects 

still under way. We will have gone well over 9,000 by then. 

Mr. PORCARI. Yes. 

Mr. OBERSTAR. If 30 States are not able to match, as current estimates indicate, 30 States are not able to provide their full 20 percent match under the SAFETEA program, then there is going to 

be a further cutback. The private sector is not coming back. Shopping malls, shopping centers, apartment complexes, business complexes, construction companies that were doing 90 percent of their 

40 

work in the private sector are now doing 90 percent stimulus 

funds. 

We could see a confluence of these negative forces right at the 

time when we need to sustain the effect of the recovery. 

Mr. PORCARI. That is very true, Mr. Chairman. I think, as I mentioned earlier, people are looking for the second stage of the rocket 

here. It is clear that—— 

Mr. OBERSTAR. That is a good image. I like that. 

Mr. PORCARI. You are welcome to use it. 

Mr. OBERSTAR. I will. I will even attribute it to you. 

Mr. PORCARI. It is clear that the efforts have been successful so 

far. We need to keep the momentum and accelerate. The need is 

out there. I know you are going to hear from the next panel some 

very direct observations on that. But all the kind of indicators that 

we see make it clear that the capacity is out there, the need is certainly out there, and, remember, this is really an investment in our 

economic future. Transportation in this sense is an enabler for the 

quality of life we all want. We need to make that down payment 

now for the next generations. 

Mr. OBERSTAR. I completely agree with that. I am glad you have 

said it that way. We say it. The Secretary needs to continue saying 

it. It would be nice if the President said that, too, put that in one 

of his speeches. It would be very helpful. People pay attention. 

I cited at the outset of my remarks today the miles, thanks to 

the reporting, nearly 28,000 miles of pavement, new construction 

improvement, widening, and transportation enhancements; 27,755 

miles and going faster as we speak. Of that number, how much do 

you estimate is state-of-good-repair projects, and how much are finishing off longer-term projects? 

Mr. PORCARI. Mr. Chairman, I wish I knew the exact numbers 

on that. And I do think it varies. 

Mr. OBERSTAR. You can supplement that. 

Mr. PORCARI. We will get you the best information we can. We 

know that many of the smaller, earlier projects that were out the 

door the quickest and got the jobs quickest were state-of-good-repair projects, just by their very nature. So we will try to get you 

some numbers on that. 

[The information follows:] 

41 


Insert offset folio 74 here 54019.074
42 


Insert offset folio 75 here 54019.075
43 


Insert offset folio 76 here 54019.076
44 

Mr. OBERSTAR. For years I have heard—and I see Mr. Basso in 

the audience; he has a long career in transportation, and he was 

part of this, too—from State DOT saying, only if we have had the 

money, we have a portfolio of projects that are ready to go; that we 

can do widening, we can do pavement improvement. Now they have 

got the money to do it. I hope and I expect that this report indicates that these 27,000 miles are those—a good deal of those stateof-good-repair projects that States have long wanted to do. Now 

they have 100 percent funding to do it. 

Mr. PORCARI. That is correct. We know that at least in many 

cases that is exactly what it was. It was the most critical resurfacing priorities, the most critical bridge repair priorities from longestablished lists that the States were unable to fund without this 

direct infusion. 

Mr. OBERSTAR. One last observation. In light of the reality of 

State revenues declining—60 billion vehicle miles fewer traveled in 

this past 8, 9 months than in the previous year, the first time that 

phenomenon that has occurred since 1956 in the beginning of the 

Highway Trust Fund and the interstate highway program—and 

with the decline in revenues and State inability to match, wouldn’t 

it be a good idea, wouldn’t it be a great benefit to States to sustain 

the momentum if we could fully fund the existing program as well 

as the stimulus on top of it? 

Mr. PORCARI. Mr. Chairman, I know we have some real challenges in that respect. I don’t have an answer for you today on 

that, but I think we all do understand that transportation is a good 

investment for the future, and that the efforts in the Recovery Act 

on transportation are a good illustration of that. 

Mr. OBERSTAR. Thank you. You are a good soldier. You didn’t 

take the administration down a path they aren’t prepared to answer yet. Very good. Very well done. But I think the answer is yes. 

Thank you. Again, thank you for your willingness to serve, Mr. 

Porcari, in public service. You had a great stewardship at the State 

of Maryland. 

Mr. OBERSTAR. Our next panel is Katherine Siggerud; Gary Ridley from the Oklahoma Department of Transportation; Joseph 

Calabrese; Rosemarie Andolino; and Mr. Van Buren, New Enterprise Stone and Lime Company, representing ARTBA. 

Welcome back, Mr. Shuster, to the hearing. 

Ms. Siggerud, thank you again for being with us and for your 

vigilance on the Recovery Act. 

45 

TESTIMONY OF KATHERINE A. SIGGERUD, MANAGING DIRECTOR, PHYSICAL INFRASTRUCTURE ISSUES, GOVERNMENT 

ACCOUNTABILITY OFFICE; GARY RIDLEY, SECRETARY, 

OKLAHOMA DEPARTMENT OF TRANSPORTATION, REPRESENTING THE AMERICAN ASSOCIATION OF STATE HIGHWAY AND TRANSPORTATION OFFICIALS; JOSEPH 

CALABRESE, GENERAL MANAGER, GREATER CLEVELAND 

REGIONAL TRANSIT AUTHORITY, REPRESENTING THE 

AMERICAN PUBLIC TRANSPORTATION ASSOCIATION; ROSEMARIE S. ANDOLINO, COMMISSIONER OF AVIATION, CHICAGO DEPARTMENT OF AVIATION, REPRESENTING THE 

AMERICAN ASSOCIATION OF AIRPORT EXECUTIVES; AND 

JAMES W. VAN BUREN, VICE PRESIDENT, DEVELOPMENT, 

AND CHIEF OPERATING OFFICER, NEW ENTERPRISE STONE 

AND LIME CO., INC., REPRESENTING THE AMERICAN ROAD 

AND TRANSPORTATION BUILDERS ASSOCIATION 

Ms. SIGGERUD. You are welcome. 

Chairman Oberstar, Mr. Shuster, thank you very much for inviting us here today. As you know, we are examining States’ use of 

funds made available for highway infrastructure projects and public transportation under the Recovery Act. The act specifies several 

roles for GAO, including reporting bimonthly on States’ and localities’ use of funds. To do this, we are working with officials from 

all levels of government and the private sector in 16 States, the 

District of Columbia, and dozens of localities throughout the Nation. Today we issued our fourth report on the Recovery Act. My 

comments are drawn primarily from that report. 

I will cover two topics: first, the use of the Recovery Act highway 

funding, including the types of projects States have funded and efforts by DOT and the States to meet the requirements of the act; 

second, the uses of Recovery Act transit funding and how recipients 

are reporting information on the number of jobs created and retained. 

In terms of highway funding, we have found that more than 

three-quarters of the highway funds have been obligated. Almost 

half of the Recovery Act’s highway obligations nationally have been 

for pavement improvement, includingresurfacing, rehabilitation, 

and reconstructing highways. State officials told us they selected 

these projects because they did not require extensive environmental clearance, were quick to design and bid, could employ people quickly, and could be completed within 3 years. 

Other common projects included pavement widening—that accounts for 15 percent of total obligations; and bridge replacement 

and improvements, which account for 10 percent of obligations. 

Construction of new roads and bridges accounted for 6 percent and 

3 percent respectively. 

Although most States’ use of funds mirror these national trends, 

States have adopted different strategies to meet their State’s transportation goals. For example, almost 60 percent of Iowa’s funds 

have been obligated for resurfacing, compared to 12 percent in 

Florida. Iowa officials total us by knocking out the pavement 

projects now, they hope to free up Federal and State funding for 

larger, more complex projects in the future. In contrast, Florida is 

46 

using funds for more complex projects now, such as constructing 

new roads and bridges. 

The level of reimbursements continues to lag behind the level of 

obligations. This is because it can take 2 or more months after 

funds have been obligated for a State to bid and award the work 

to a contractor and to begin the work. Then it make takes month 

before a State requests reimbursement from FHWA. Once they do 

so, FHWA is required to pay the State promptly. As is shown in 

figure 1 in my statement, reimbursements have increased considerably over time. 

In April, when we issued our first report, reimbursements stood at $10 million, or 1/10 of 1 percent of the amount obligated. By 

mid-November reimbursements stood at $4.2, more than 20 percent 

of the amount obligated. 

As you know, the Recovery Act requires that all apportioned 

highway funds must be obligated within 1 year. Federal and State 

officials we interviewed are confident that the remaining highway 

funds will be obligated by that March deadline. However, two factors may affect some States’ ability to do so. First, as has been 

mentioned in this hearing, State and local governments are getting 

good deals in awarding contracts for less than the original estimated cost. Every State we contacted awarded at least half of its 

contracts for less than the original cost estimate. This allows the 

States to use the savings for other projects, but they must be identified quickly. In the weeks ahead, FHWA and the States have the 

opportunity to exercise diligence to both promptly seek the obligation of known savings, and to identify projects that make sound use 

of Recovery Act funding. 

Second, obligations for projects in areas that receive suballocated 

funds, while increasing, are generally lagging behind obligations 

for statewide projects and lagging considerably behind in a few 

States. The Secretary is to withdraw highway funds, including suballocated funds, which were not obligated before March 2, 2010. 

These funds will be redistributed to States that have all of their 

statewide funds obligated. However, States that do not have all 

their suballocated funds obligated will be eligible to receive redistributed funds. 

We also report today on the maintenance-of-effort requirements 

in the States. This important provision has proven to be more complicated than anticipated, and some States will have difficulty 

meeting it. 

Turning to transit, the majority of transit funds have been obligated. For example, of the $6.9 billion apportioned under the Transit Capital Assistance Program, almost $6 billion has been obligated as of November, with the vast majority being for upgrading 

transit facilities, improving bus fleets and conducting preventive 

maintenance. Many transit agency officials told us they decided to 

use Recovery Act funding for these types of projects since they are 

high-priority projects that support their agency’s short andlongterm goals, can be started quickly, improve safety, or otherwise 

would not have been funded. 

Finally, we did find some confusion among transit agencies and 

bus manufacturers regarding the suggested methodology for calculating the numbers of jobs created or saved through bus purchases. 

47 

This could call the reliability of such information into question. We 

have previously recommended that OMB work with the recipients 

to enhance understanding of the reporting process, and that DOT 

continue its outreach to State DOTs and transit agencies to ensure 

recipients of Recovery Act funds are adequately fulfilling their reporting requirements. 

Mr. Chairman, this concludes my testimony. I am happy to take 

any requests you may have. 

Mr. OBERSTAR. Thank you very much. Your entire statement will 

be included in the record. 

Mr. OBERSTAR. Secretary Ridley. 

Mr. RIDLEY. Mr. Chairman, Members of the committee, I am 

Gary Ridley, secretary of the Oklahoma Department of Transportation and Chair of the Construction Subcommittee of the American Association of State Highway and Transportation Officials, or 

ASHTO. I want to thank you for ensuring that the Recovery Act 

included substantial funding for transportation investments. 

Today I want to present three points. State departments of transportation have delivered on the promise of quickly putting recovery 

funds to work in creating jobs. Also, State DOTs have identified an 

additional 9,500 projects valued at $70 billion that could be quickly 

advanced, creating and sustaining thousands of jobs across rural 

and urban areas in all States. 

I want to share the lessons learned from the Oklahoma Department of Transportation secretary’s successful experience in implementing the Recovery Act. First, States have been successful in 

quickly putting funds to use. As of this past Monday, according to 

the Federal Highway Administration, more than $21 billion, almost 

80 percent of the ARRA highway dollars, have been obligated, with 

some 5,400 highway projects valued at $14 billion under construction in every part of the country. Ninety-five percent of these 

projects approved by the Federal Government or obligated have 

moved quickly to bid, and 80 percent to contract award. Hiring, 

material and equipment orders begin once the contractors know 

they are the successful bidder. 

Funding made available by the Recovery Act is having a positive 

effect on jobs and the economy. ASHTO recently completed a survey of its members to assess additional transportation projects that 

States could quickly get under way, obligated in 120 days and put 

out to bid and under construction shortly thereafter. States identified an additional 9,500 highway, bridge, transit, port, rail and 

aviation projects, again worth over $70 billion, that, if funded, 

could be used to create these hundreds of thousands of jobs across 

the country. 

Finally, I would like to share a few lessons learned from the 

Oklahoma Department of Transportation’s successful experience in 

implementing the Recovery Act and getting projects out the door 

and on the ground quickly. Oklahoma received $465 million in 

stimulus money for transportation projects. I am pleased to report 

that we have obligated 90 percent of our highway funds earlier this 

month, and have 83 percent under construction, and 13 percent are 

completed. We have moved much faster than the law required. 

We attribute our success to two critical components events. early 

planning. We began preparation several months in advance of the 

48 

legislation, undertaking engineering work, coordination with our 

MPOs and county commissioners to select projects to advance if 

funds became available. 

In order to comply with the enhanced transparency, accountability, and oversight requirements, we implemented an intensive 

risk management strategy. Under this approach, for example, we 

only allowed ARRA funds to be used for direct construction, and we 

split-funded projects so that any cost overruns, change orders 

would be funded by other sources. 

I want to add that we have used the ARRA funds for a number 

of large, complex, multimillion-dollar projects, as well as for smaller, simpler, rehabilitation projects. One large project in Oklahoma 

is a $70-plus million improvement to Interstate I-244 in downtown 

Tulsa. This project required closure of the interstate to facilitate 

pavement replacement and the rehabilitation or replacement of approximately 40 interstate bridges. 

In a 10-month window since the enactment of the Recovery Act, 

the Department has paid out more than $240 million to construction contractors, which represent more than 50 percent of the 

ARRA funds available. We have and just completed an annual rebalancing of our 8-year construction work program. Because of the 

ARRA funds, we were able to accelerate many projects, thus creating an ARRA domino effect, if you will, that accelerates other 

projects ahead of existing schedules and enables us to advance new 

critical projects into the program. 

Thank you, Mr. Chairman and Members of the committee, for including transportation funding in this Recovery Act, and your leadership and commitment to the Nation’s transportation infrastructure. The Recovery Act has clearly demonstrated that transportation infrastructure investment delivers jobs and boosts to the 

economy. State DOTs have, again, proven that we can deliver on 

our commitments. 

We are encouraged that the administration has endorsed additional funding to continue modernizing our transportation network 

as one means of accelerating job growth. We applaud the efforts 

under way in the House and Senate to come up with an agreement 

on a job growth package that includes infrastructure funding. 

Mr. Chairman, one-time infusion of unanticipated funds are always welcome, and we have proven that we can deliver on our commitments; however, I would be remiss if I did not mention the need 

for a growing, consistent, long-term Federal investment strategy 

that identifies and considers all possible revenue sources. 

I would be pleased to answer any questions you may have. 

Mr. OBERSTAR. I want to thank you for that comment. You are 

not remiss. You have done the right thing. That is what we need 

to do, what the Congress needs to do. I will send your statement 

to the White House. 

Mr. Calabrese. 

Mr. CALABRESE. Chairman Oberstar, Congressman Shuster, I 

want to thank you for allowing me to be here. My name is Joseph 

Calabrese. I am the general manager of the Greater Cleveland Regional Transit Authority. I have been asked to provide testimony 

regarding my Authority’s utilization of the American Recovery and 

49 

Reinvestment Act funds and also talk about the future funding 

issues facing public transportation. 

RTA is a multi-modal transit agency operating bus, light rail, 

heavy rail and BRT, serving about 200,000 customers on a typical 

weekday. RTA has been allocated $45.75 million in ARRA funding 

from two sources: $34.57 from the urban formula, and $11.2 million 

from rail mod. By filling the gap in eight previous grants, the 

$45.75 million has allowed us to invest over $65 million in stimulating the economy. We have also dedicated 10 percent of the urban 

grant formula to operating assistance to preserve needed jobs at 

RTA. 

To date we have contracted or awarded 109 contracts on 15 

projects, $48.4 million, with $23.9 million being ARRA funded. An 

additional $5.3 million of ARRA contracts are scheduled to be 

awarded next Tuesday at our board meeting. I am very pleased to 

announce also that 22.6 percent of the contract value was awarded 

to disadvantaged business enterprises. 

In the latest monthly report to the committee, it was documented 

through October 30 we have preserved or created 524 job months 

of labor, over 90,000 labor hours, and over $2.4 million in payroll. 

The majority of our projects by far have been state-of-good-repair 

projects on our rail systems. Others include construction of a transit center and the purchase of 35 transit vehicles that produced 

jobs in both Kansas and Ohio. 

I would like to highlight four projects for you, but it is important 

to say that none of these projects would be in the ground today 

without the ARRA funding. I have got some pictures in my testimony of both renderings and construction in process. 

The first is a the 40-year-old station called the Puritas Red Line 

station, which is in major need of repair and infrastructure improvements. The construction bids were received April 2, contract 

awarded April 21, construction started on June 1; $5.3 in ARRA 

grants, plus $6.3 in existing grants to fund the project, which will 

be complete by the end of 2010. 

The East 55th Street rail station will improve a 50-year-old station that serves all three of RTA’s rail lines. Construction bids were 

received on June 10, contract awarded June 30, construction started on August 10; $5.8 million of ARRA grants were combined with 

$5.7 of existing grants to fund that project. You can see some 

renderings and also some construction under way. 

Kind of an interesting project is one of our uses of ARRA funds 

which is the rehabilitation of 40 20-year-old rail cars. A unique feature of this project, it is being used as a nucleus for RTA’s apprenticeship training program. We have four skilled supervisors training 15 apprentices on this job, and they have the ability to take 

jobs in our rail shop when this project is over. Again, a really good 

way to move them up in our organization and increase skill levels. 

The last project I want to highlight is a special one to me. It is 

called the Stephanie Tubbs Jones Intermodal Transportation Center, named for the former Congresswoman, who was a strong supporter of public transit. The center will be a clean, safe, and firstclass facility that will serve over 500 buses and thousands of customers daily. Construction bids were received on July 13, contract 

awarded on July 28, with the groundbreaking taking place on SepVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00121 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
50 

tember 10, which was, by no accident, Stephanie’s 60th birthday; 

$4.4 million of ARRA funds and $4.9 million of existing grants, including earmarks supported by Stephanie, are used for this project, 

which will be completed in 2010. 

I want to take 1 minute to talk about the importance of operating funds used as part of the ARRA. My premise is, Congressmen, that a job is not just a job, and some jobs are more important 

than others. We were able to save 57 jobs through use of the ARRA 

funds, but that is only part of the story. These 57 bus operators 

doing their normal job take over 5,000 people to work and back 

every day, so helping them preserve and retain jobs. Again, a tremendous return on investment. 

The future does not look particularly good. In 2009,RTA’s pri- mary funding source, the local sales tax, will be $20 million below 

last year’s level due to the recession. Despite our best efforts, we 

are looking at a 12 percent service cut in April, which will result 

in job loss by our agency and by our customers. 

We urge you to reauthorize the transportation bill at the highest 

level of investment possible, and to allow new funds or greater 

flexibility in funds to help address operational pressures. I know it 

is something that has been discussed in the past, but something 

that I think needs to be revisited certainly once again. 

With respect to ARRA investment across the country, you have 

heard from the Federal Transit Administration a very high percentage of funds have been obligated. We think that is great. 

Funds have gone to projects such as rail mod, the purchase of 

12,000 new buses, construction of bus facilities, preventive maintenance, and expansion of light-rail systems. A recent report on public transit investment found that for every billion dollars of Federal 

investment yields 30,000 jobs. Along with APTA’s survey, which 

identified more than 15 billion ready-to-go capital projects, this 

means that more than 450,000 new jobs can be created or supported with some investment. Clearly, any legislation designed to 

create jobs must have a strong public transportation component. 

I thank you for your time. 

Mr. OBERSTAR. I agree with your latter point and grateful for the 

other information that you provided us. Thank you very much. 

Ms. Andolino. 

Ms. ANDOLINO. Thank you, Mr. Chairman, Congressman Shuster. My name is Rosemarie Andolino, and I am the commissioner 

of the Chicago Department of Aviation. On behalf of the American 

Association of Airport Executives, I appreciate the opportunity to 

testify before your Committee to discuss stimulus funding for airports. 

First, allow me to thank you for this committee’s work and support of the American Recovery and Reinvestment Act of 2009. I 

would also like to thank the Members of the Committee for passing 

the FAA Reauthorization Act of 2009 with a critically needed increase in the passenger facility charge cap. 

The Chicago Department of Aviation owns and operates O’Hare 

and Midway International Airports. Together they handle more 

than 82 million passengers annually, with service to more than 230 

cities worldwide. Our airports are major economic generators for 

the region, generating nearly $45 billion in economic activity and 

51 

540,000 jobs. Mayor Daley’s plan to modernize O’Hare will create 

an additional 195,000 new jobs for our region and add an additional $18 billion to the Chicago region’s economy. The Recovery Act included $1.1 billion for ready-to-go airport 

construction projects. Airports nationwide are using the additional 

AIP funding to improve their facilities and stimulate the economy 

through good-paying jobs. The FAA should be commended for 

issuing the grants so quickly. The agency’s prompt actions have allowed airports to move ahead with their infrastructure projects and 

create jobs for their local communities. Chicago received $12.3 million in Recovery Act funding for runway improvements at O’Hare. The projects are substantially complete and will improve runway operations and increase efficiency at 

O’Hare and throughout the national aviation system. The stimulus 

funding allowed us to proceed with additional work that produced 

benefits beyond those provided by the O’Hare Modernization Program. Our contractor has recorded a total of 33,300 manhours on 

this project through October, enough to employ 35 full-time direct 

jobs over this period. 

The Recovery Act also temporarily eliminated the alternative 

minimum tax penalty on airport private activity bonds. This tax 

provision is helping airports move forward with critical infrastructure projects that had been delayed because of the collapse of the 

bond market. Thus far, airports have issued more than $5 billion 

in bonds that have benefited from AMT provisions. They save more 

than $600 million. 

Mr. Chairman, as Congress begins to consider a new legislation 

to help create jobs, we encourage you to include provisions that will 

help airports move forward with key infrastructure projects that 

reduce their financing costs. First, we encourage Congress to include substantially moreAIP funds in the next jobs bill. AIP funding would improve aviation safety and help airports prepare for future demand. The additional infrastructure projects would also 

help stimulate the economy by creating jobs. 

Second, we urge you to work with your colleagues on the House 

Ways and Means Committee to take the next steps and permanently eliminate the AMT penalty on airport private activity bonds. 

A permanent AMT fix would help save airports billions of dollars. 

Third, Congress can help stimulate the economy by passing a 

multiyear FAA reauthorization bill that will raise the PFC cap to 

$7.50 and index it for inflation. Raising the PFC cap would help 

airports across the country. In Chicago, it will assist us in funding 

the completion phase of the O’Hare Modernization Program. Thus 

far the first phase of the OMP has created on average 1,400 jobs 

a year. Increasing the PFC will help us stimulate the economy by 

creating thousands of good-paying jobs every year for the next 5 

years without burdening the taxpayer. 

Finally, as we work to improve infrastructure and create new 

jobs, it is important to incorporate green technologies. At Chicago’s 

airports we have demonstrated that sustainable initiatives are not 

only possible, they are essential. This year, working with other airports, we released our sustainable airports manual, which focused 

on sustainable guidelines for airport design and construction, and 

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52 

ning, daily operations and maintenance, as well as concessions and 

tenants. These ongoing efforts will also promote green jobs in our 

industry. 

Now is the time to make investments in our national airport system. With your leadership airports nationwide are receiving critical 

funding to increase system capacity, safety and efficiency, and 

making environmental improvements, with the added benefit of 

stimulating the economy. We are grateful for the support and encourage the Congress to continue these critical efforts. 

I am happy to take any of your questions, and I would like to 

extend an invitation to visit Chicago for a tour of our airport system. 

Thank you. 

Mr. OBERSTAR. Thank you very much, Ms. Andolino. 

Mr. OBERSTAR. Before we get to the questions, I just wanted to 

compliment airport executives, as I have done AASHTO, the DOT 

commissioners. Your projects—your colleagues’ projects went out 

faster than the highway projects because there is something that 

I am going to ask you to explain in the contracting authorities that 

airports have that they can take the bids, and award the bids, and 

hold the prices for a period of time, and that is how they got those 

projects out so fast. We will come to that later. 

I am going to ask Mr. Shuster to do the introduction of our next 

witness. 

Mr. SHUSTER. Thank you, Mr. Chairman. 

It is a pleasure to have not only a good friend and a neighbor, 

but really one of the operators of one of the premier companies in 

Pennsylvania, central Pennsylvania, New Enterprise Stone and 

Lime. It started in the little town of New Enterprise, a very small 

town—I don’t think there are a couple hundred people that live 

there—but it has grown to be a prominent Pennsylvania company, 

grew into a regional company. Now it is a national company, and 

a lot of it has to do with our next witness, who is the chief operating officer. He has been a prominent voice in the State of Pennsylvania on issues of highway funding and transportation, and now 

he is on the national stage. 

I don’t want to put too much pressure on you, because when I 

see you for the holidays, you will probably get back at me somehow. 

Welcome, and we are looking forward to hearing your testimony. 

Mr. OBERSTAR. He wouldn’t do such a thing. 

That is a wonderful introduction. 

Mr. Gerlach, do you want to pile on? 

Mr. GERLACH. I would just echo Congressman Shuster’s comments on the leadership of Mr. Van Buren in highway construction 

issues in Pennsylvania. He is known as not only within his own 

company’s right, but also within the State association a very prominent highway construction leader. We certainly appreciate and 

prize his comments and his insights into how we can make this a 

better system for not only Pennsylvania, but for the entire Nation. 

I am really appreciative of the fact he is here. 

Mr. OBERSTAR. Thank you. 

Now, Mr. Van Buren, no pressure on you, but with that praise, 

you have got to do a great job for us now. 

53 

Mr. VAN BUREN. Thank you, Mr. Chairman. Now that Congressman Shuster has destroyed my introduction here, I will continue 

on to the second paragraph. 

Thank you for the invitation to speak today. I am here representing the American Road and Transportation Builders Association to discuss implementation of the American Recovery and Reinvestment Act. 

As Congressman Shuster said, New Enterprise was formed in 

1924 by J.S. Detwiler and his son Paul, and is currently managed 

by third- and fourth-generation Detwilers. We are a vertically integrated construction material supplier, highway contractor, and 

traffic safety products and service providers. New Enterprise is the 

largest producer of aggregate in Pennsylvania and 16th largest in 

the United States, and is a top 50 heavy highway contractor in the 

U.S. The age, size, and diversity of our company allows me to offer 

a broad perspective on the Recovery Act impact on the transportation construction industry. 

Mr. Chairman, the transportation components of the Recovery 

Act are a true success story. The economicdownturn has had a substantial adverse impact on our company and the entire industry. 

Our sales quantities dropped significantly from 2007 to 2008. Without the Recovery Act’s transportation investments, all our markets 

would have continued their free fall this year. My written testimony includes data that shows stimulus funds have had a significant impact on New Enterprise, the transportation construction industry, and helped to prevent thousands of permanent and early 

season layoffs by construction firms and their suppliers nationwide. 

It is certainly true our industry continues to suffer from the recession and is experiencing disproportionate levels of unemployment. That reality is not an indictment on the Recovery Act, but 

rather illustrates how much worse our situation could have been. 

As of the end of November, $21 billion of Recovery Act highway funds had been obligated, and $14 billion of that amount was 

under construction. That means two-thirds of the available funds 

are generating economic activity and supporting employment. Almost 96 percent of Pennsylvania’s Recovery Act highway funds 

have been obligated, and of that amount, more than 19 percent of 

the work has been completed. 

Contractors make employment decisions and purchase material 

and equipment when contracts are awarded. As such, the economic 

benefits occur long before the project completion. 

New Enterprise has been awarded over $50 million of Recovery 

Act contracts. Approximately 50 percent was performed in 2009, 

and the balance will be done in 2010. We have also supplied materials and been subcontractors for a number of additional Recovery 

Act projects. Although the sales have not reversed the negative 

sales trends we are seeing in stone, sand, concrete block, and 

ready-mix, they have certainly helped replace hot-mix asphalt and 

construction work not being done currently in the commercial and 

residential markets. 

Our firm incurred a 5 percent decline in employment from 2007 

to 2008, but this trend slowed in 2009 to 1 percent. Without the 

Recovery Act-funded work, this situation would have been much 

worse. 

54 

While the Recovery Act has certainly been helpful in the short 

term, we must recognize this legislation was never intended to be 

a long-term solution. Absent action on a multiyear surface transportation program reauthorization bill or some other infusion of 

transportation infrastructure investment, we are looking at marked 

retraction within the next 2 years. In fact, New Enterprise is projecting declines as early at late 2010. 

Clearly, the robust 6-year investment levels proposed by this 

Committee would be the more ideal move to stabilize and grow the 

U.S. Transportation construction market. If, however, it is not attainable, an alternative measure that significantly boosts infrastructure investment in the short term and retains the integrity of 

the Highway Trust Fund can also provide a critical economic boost. 

In fact, the success of the Recovery Act is proof that our industry 

has the capacity to take on additional work, complete it quickly, 

and help reverse unemployment trends. That said, the maximum 

economic multiplier effect only occurs under a 6-year measure. 

We thank the Members of this Committee for your leadership on 

the Recovery Act and your efforts to deliver a multiyear reauthorization bill. I appreciate the opportunity to testify, and would be 

happy to answer any questions. 

Mr. OBERSTAR. Thank you very much for that splendid testimony, and of course, your complete statement will be included in 

the record. 

And now, in light of the pending votes, I will ask Mr. Shuster 

to begin the questioning. 

Mr. SHUSTER. I will yield. 

Mr. OBERSTAR. The gentleman wishes to yield to Mr. Gerlach. 

Mr. GERLACH. Thank you both. 

I wanted to follow up on a comment that Mr. Van Buren had in 

his testimony as well as a comment that Secretary Ridley had in 

his testimony. 

And specifically, Secretary Ridley, you indicated that Oklahoma’s 

successful experience utilizing ARRA funds offers lessons that we 

are able to be sharing with all States relative to the rapidity of 

moving ARRA funds through the process and getting them into 

projects. 

And I think, Mr. Van Buren, you indicated the same thing of 

how Pennsylvania’s PENNDOT, Pennsylvania’s Department of 

Transportation, has been able to move dollars quickly, get projects 

identified and get contracts let, get projects underway on the 

ground. 

From those experiences that you have seen in both Pennsylvania 

and Oklahoma, what long-term lessons are generated from that experience that in the future can help streamline the process, assuming there is going to be sufficient dollars ultimately for transportation infrastructure projects through future pieces of legislation? 

What are some of the lessons you learned utilizing ARRA funds 

that can be applied long term to, again, getting projects done expeditiously and more cost-effectively over a long period of time? 

Mr. VAN BUREN. Well, I know what we did in Pennsylvania was, 

the contractors and PENNDOT got together we really compressed 

the schedule from project conception through project award to 

project construction. It was a matter of just working with the conVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00126 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
55 

tractors association and the Department of Transportation to take 

what has typically been about 180-day schedule, and we were able 

to knock it down to 60 to 90 days. And it was really just a matter 

of saying, this is when this project is going to bid and had gotten 

bid every other week, and they now have been, ever since the stimulus money came in, bidding weekly. And if a project is going to 

bid on April 7th, that is when it bids. And if it is supposed to go 

to construction 15 days later, then the contractors knew we were 

going to be working 15 days later. And it was just that commitment of bringing the parties together and everybody agreeing up 

front, this is what we are going to do. 

Mr. GERLACH. Secretary. 

Mr. RIDLEY. Not different than what PENNDOT did. We met 

with our contracting industry partners early in November, right 

after the election, because we really felt that Congress was moving 

in this direction, and we felt it was important for us to get ready. 

But not only that, as you might expect, in project delivery, it is 

more than just the bidding of the project and getting it out to contract. All of the prep work that has to go in with the environmental 

process, right-of-way acquisition, utility relocations, that has to be 

done prior to the project. 

I think a key factor that we have learned in lessons learned is 

a couple of things. You have to have the Federal agencies be your 

partners. They have to come to the table willing to move quickly, 

make decisions quickly, and not delay things. And it is not just the 

Federal Highway Administration but also the resource agencies, 

Corps of Engineers, U.S. Fish and Wildlife. Those that play a part 

in the environmental process and decisions that have to be made 

quickly in order for us to move quickly. 

I think, once the administration says that this is a priority of the 

Nation to move forward quickly, then I think your resource agencies and your—the Federal bureaucracy, if you will, can move 

quickly as well. I think government can do good things, and government can move quickly. Sometimes government needs to do just 

that. 

Mr. GERLACH. I thank you both for your testimony today, and 

thank all the panelists for your testimony as part of this important 

hearing. 

I yield back to the Chairman and my colleague, Mr. Shuster. 

Mr. OBERSTAR. Thank you, Mr. Gerlach. 

And I appreciate the response from Secretary Ridley and Mr. 

Van Buren that I think you said it very well, Secretary Ridley, that 

the Federal Government has to be a partner, has to make decisions 

quickly, has to engage all the other agencies. And that is what we 

provide in our long-term surface or 6-year surface transportation 

authorization bill, an Office of Project Expediting within the Federal Highway Administration and within the Federal Transit Administration, one entity whose job will be to keep these projects 

moving ahead, bring the parties together, everyone who has a permit. 

It is not just the EPA. It is a township officer has a permit to 

give and someone else has a permit to give. And all sorts of entities 

have permits to give. Get them all in a room together and avoid 

this sequential decision-making process. Everyone has a crack, and 

56 

they take their time at doing it, so that it takes 3 years to do a 

simple mill and overlay. I am exasperated with that process, and 

we have to end it. And we can when we get the bill enacted. 

And I would like your comments, not now—I mean, on the concept, but I am sure you have a copy of that language from our bill. 

Give us whatever thoughts you have on how to improve it or make 

it better, apart from taking certain entities out and shooting them, 

as someone suggested to us. That is not very helpful. 

Mr. Shuster, I yield my time to you. 

Mr. SHUSTER. Mr. Chairman, I appreciate your passion, and I, 

too, hope we can figure out a way to move these projects a lot 

quicker. I think we have. We must. And I want to come back to 

that question for the secretary. 

I want to welcome the secretary from Oklahoma. I know Mary 

Fallin was here, and I am also good friends with John Sullivan, 

who have the highest regard, both, for you and your abilities as the 

secretary of transportation there in Oklahoma. Thank you, all of 

you, for being here today. 

I wondered, Mr. Van Buren—I don’t think I’ve ever called you 

Mr. Van Buren before, and it will end after this is over today. You 

talked a little bit about what your company is doing, investments, 

and you and I have had a number of conversation about that. Can 

you go into a little more detail of what you would typically invest 

if you had a long-term bill, a long-term transportation program in 

front of you versus what you have been doing? Because I think the 

thing that you can bring to light is the ripple effect through the 

economy. So if you can talk a little bit about that. 

Mr. VAN BUREN. Sure. What ISTEA passed, TEA-21 passed and 

SAFTEA-LU passed, when those three bills passed, the first 2 or 

3 years in those bills, we expanded plant capacities in aggregate 

plants, hot-mix asphalt plants, ready-mix plants, precast plants. 

We invest knowing that there are going to be predictable funds 

going into the system. 

And what we do now, since with the expiration of the bill and 

not knowing whether there is going to be a 2-year bill or a 6-year 

bill, we buy big cases of duct tape and lots of spools of bailing wire, 

and that is how we fix our equipment. We don’t make big investment moves. We don’t really know what is going to happen. So we 

can’t bring on college students, which typically we would hire two 

or three college students every year and start training them to 

come into our industry. It is very difficult to get kids out of the 

trade schools and start training them to be operators, and laborers 

and carpenters, because we have plenty of people on staff who are 

not fully employed or being fully utilized. 

So our training programs kind of sit off to the side. Our capital 

investments, which are really, you know, they are large trickledown type things. When we buy a truck, it can be three quarters 

of a million dollars to a million and a half dollars. That is a big 

investment. I need know it will be busy for several years before we 

can actually do the actual acquisition. 

In talking to colleagues of mine that work at Caterpillar and 

some of the other big construction companies, I could drive by their 

yard, and right now, I could rent any of those pieces because they 

are all just siting there, which means that the people back in PeoVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00128 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
57 

ria are not building more trucks, because there are plenty of trucks 

just sitting out there in rental fleets, which if I were to get a job 

off of stimulus, that is where I am going to go first. If I don’t have 

it in my own fleet, I am going to rent it from somebody, which 

means we are not going to build it, which means the foundries are 

not working. The trickle-down in our industry, the basic industries 

of aggregate supply and then construction is a very, very long 

chain. 

Mr. SHUSTER. Not that I want you to name private companies, 

so you may not want to talk dollars, but percentage-wise, what 

kind of cut or what kind of decrease in capital spending are you 

experiencing? 

Mr. VAN BUREN. Well, I put it in my testimony just because I 

think it is important, and even though we are privately held, we 

typically don’t go into big—we don’t lay our finances out. But I do 

think it is important that people understand; we would typically 

spend upwards of $45 million on capital spending. And we are in 

the $20 million range right now, and that just fixes stuff. It buys 

a few over-the-road trucks because maybe something just won’t run 

anymore, but the years of placing orders for 10 and 15 over-theroad trucks, and 17 mixers and 3 large dozers, and 5 trucks, we 

just can’t do that without knowing where the funding stream is 

going to come from. 

Mr. SHUSTER. And just one more point, you expressed the training part of it. If you are not training people today, you have cutback on that, all of a sudden the economy turns—not all of a sudden, but eventually the economy turns around and we get a highway bill, how difficult is that for you to then bring it up to speed 

and have enough workers to do the jobs you need to train them for? 

Mr. VAN BUREN. It just makes everything—it just makes the 

whole system more inefficient; it makes it inefficient. We can have 

a very efficient system of bringing people on, having older generation employees train younger generation employees, but as I believe someone said earlier, we have the older generation that really 

is the heart and soul of a lot of this industry, they are retiring, 

which means I am going to miss, sort of, that generational training 

piece. We need really 100 percent continuity, bill to bill to bill, as 

we had in the last three succession of bills. And so we need something soon to show our industry that there is a national level commitment to this, and then we will train, and we will start buying 

stuff. 

Mr. SHUSTER. Thank you. 

Mr. OBERSTAR. I don’t know if we are going to break now. I 

would come back afterwards. 

Mr. OBERSTAR. If the gentleman would conclude at this point. We 

will return. 

I will yield to Mr. Lipinski. 

Mr. LIPINSKI. Thank you, Mr. Chairman. 

I want to make this quick, so I want to compliment Ms. Andolino 

on OMP and especially the thing about green jobs, going green. I 

have right here the wristband, which not just relating to that, but 

I know there is also airportsgoinggreen.org, talking about all of the 

great work being done in creating green jobs; not just jobs, but 

58 

also, more importantly, green jobs at O’Hare with the O’Hare modernization. 

I wanted to ask Ms. Andolino and then open it up to anyone else 

who might have things to add more generally, first of all, specifically on job creation at O’Hare with the modernization program but 

also the expansion of capacity, as everyone knows the issue of 

opening up the capacity at O’Hare is critical for the, not just for 

O’Hare and Chicago area, but also for the entire Nation in helping 

to alleviate issues of delays in the system. And so could you give 

us more information—I know you went through it in some of your 

testimony—but job creation and additions to capacity that is going 

on at OMP? 

Ms. ANDOLINO. Thank you, Congressman. 

Yes, actually, I would be happy to. In terms of capacity, and I 

will address that first, you know we opened our first new runway 

at O’Hare in over 30 years on November 20th of 2008. That runway 

is now yielding us over 22 percent increase in our arrival capacity. 

So during these challenging times of weather conditions that we 

experience in the Midwest, we are still able to land three planes 

simultaneously and during certain weather conditions. So that is a 

benefit to not only O’Hare but to the national aviation system, because we do impact that entire system. 

So we seeing benefits immediately with the addition of that new 

runway. We have three new additional runway projects to go; one 

that is currently under construction. So we have been able to keep 

people working since 2005, when we put our first shovel in the 

ground on the OMP. We have been employing anywhere between 

900 to over 2,000 direct construction jobs annually, during our construction seasons. And, again, that is strictly construction. 

In terms of designers, anywhere from 250 designers to over 500 

designers have been employed. And that is not all of the other indirect jobs, all of the management, quality control, construction management, program management, financing, the back office of these 

designers and contractors, and the employees that they pay. So 

that is why when we talk about the O’Hare modernization program 

and its ability to then generate up to 195,000 new jobs for our region, it includes all of those pertaining to construction and design 

and all of the efforts that I have just discussed. But also, in terms 

of our entertainment business, tourism, restaurants, that construction worker that is working on our program that comes to work 

every day, he doesn’t bring his lunch, or when he does, he is still 

purchasing it as a store or going to a restaurant in and around our 

area. And it is that compound effect that keeps people working at 

the local Starbucks, at the Dunkin Donuts, et cetera. So that is 

where the 195,000 new jobs comes in over the life of our program. 

And we have really been able to keep a stimulus program going 

in Chicago because our program will go until 2014. And that is 

why, with the additional monies of the passenger facility charge 

and if we are able to increase it to $7.50 plus indexing, all airports 

like O’Hare will be able to continue their programs, their infrastructure programs, without burdening the taxpayer. And so we 

can continue to keep people employed. The construction industry 

can knowingly invest in new equipment. We can keep the John 

Deeres and the Caterpillars healthy in our local region and elseVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00130 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
59 

where so, that we can keep those jobs and keep some type of continuity and stability to the job industry. 

So we are trying to do our part, keep people working. Any additional funds we can get in infrastructure, in the America Recovery 

and Reinvestment act, we will put those to good use. All of my colleagues at airports will do the same, as well as, as I said, the increase in the PFCs would help us all for the long term keep construction moving to enhance our capacity at our airports that are 

in desperate need to not only rebuild existing but add new capacity 

to their airports. Thank you. 

Mr. LIPINSKI. I see my time has expired, and we have the votes, 

so I will yield back to the Chairman. 

Mr. OBERSTAR. We have 2 minutes remaining on the vote. We 

will recess at this point and reconvene as soon as possible after the 

three recorded votes. 

The Committee is in recess. 

[Recess.] 

[1:54 p.m.] 

Mr. OBERSTAR. The Committee will resume its sitting. And while 

we await the arrival of other Members, I would ask Ms. Siggerud 

to do a simple ministerial task, and that is to define the term 

′′obligate.′′ It is budget speak. That is an obscure word for most 

people who do not understand. What does that mean? 

Ms. SIGGERUD. Well, I am going to answer that for the Federal 

Aid Highway program, as you know, ′′obligate′′ has different meanings—— 

Mr. OBERSTAR. That is the context in which I want it. 

Ms. SIGGERUD. Yes. What that means is that the Federal Highway Administration has reviewed and approved a project proposed 

by the State and determined that it is eligible and notified the 

State that it can in fact spend funds, spend Federal funds for the 

purpose of that project. 

Mr. OBERSTAR. And you said it very well, probably better than 

I, more precisely than I would have done. 

That is very different from putting out to bid—— 

Ms. SIGGERUD. Yes. 

Mr. OBERSTAR. Awarding contracts, having under construction. 

Ms. SIGGERUD. Yes. In fact, what we talked about—— 

Mr. OBERSTAR. It is a precursor term in effect or a precursor action, if you will. 

Ms. SIGGERUD. Right. It essentially tells the State that this 

project is an eligible project under the Federal Aid Highway program, and the State can then go to the following steps that you 

have just outlined, including advertising for bids, choosing bids and 

awarding a contract. 

Mr. OBERSTAR. Now, under the act, States were given 120 days 

in which to obligate up to or no less than 50. 

Ms. SIGGERUD. Right. 

Mr. OBERSTAR. No less than 50 percent of their funds. The House 

bill required, had a much shorter time frame, a much shorter leash 

on States. And many objected or raised questions, budget speak 

people over at OMB raised questions, and in conference, the House 

relented and gave into those complaints. Have you seen any difficulty in the States being able to meet the 120-day time frame or 

60 

even a 90-day time frame? Didn’t most States get their money obligated well in advance of that timeframe? 

Ms. SIGGERUD. Both the transit and highway programs, both of 

those obligation deadlines were met. There was, of course, the 120- 

day that you mentioned for highways. And for the transit, there 

was a deadline in September, as you recall. 

Mr. OBERSTAR. Yes. 

Ms. SIGGERUD. There is now another deadline coming up March 

2nd of 2010. It looks like States are on track to plan to meet that 

obligation deadline with a couple of the caveats that I mentioned 

in my short statement, which is that we are seeing, because of 

these low bid amounts and the contract awards that are lower than 

the estimates, we are seeing that the States are needing to de-obligate and then re-obligate for new projects. So that is a constantly 

ongoing process in many of the States that we are reviewing. 

As well, there is the issue, in a few States, of those funds that 

were sub-allocated to metropolitan areas are not being obligated at 

the same rate as the State DOTs are obligating their highway 

funds. 

Mr. OBERSTAR. Correct. And the first example you just gave is 

results from bids coming in lower than final design engineering estimates. 

Ms. SIGGERUD. That is right. 

Mr. OBERSTAR. And the second is because there are some difficulties that we haven’t quite identified yet with MPOs that are not 

able to obligate and get under contract as quickly as State DOTs, 

correct? 

Ms. SIGGERUD. That is right. In general, it does vary quite a bit 

by State, the extent to which localities handle the Federal Aid 

Highway program on a regular basis. Some localities have more experience with handling Federal Aid Highway program and complying with its requirements than others. Those that have less experience are generally not obligating as high a rate as others. 

Mr. OBERSTAR. Well, in short, then, the MPO issue is an uneven 

one. Not all are in that category, or some are doing better than others? 

Ms. SIGGERUD. Absolutely. We are looking at 17 States, Chairman Oberstar. Of the 17, we have 3 where the sub-allocated obligations are at a much lower rate than the State level. And that is 

Arizona, Massachusetts and New Jersey. The difference is not as 

pronounced for the other States we are reviewing. 

Mr. OBERSTAR. Those 17 States represent 68 percent of the population. 

Ms. SIGGERUD. That is right, 68 percent of the dollars in the Recovery Act. 

Mr. OBERSTAR. I will come back to pursue this a little bit. But 

it is important for us as we proceed to the authorization bill, the 

Surface Transportation Act, there are some issues that we need to 

resolve or some problems in operation at the MPO level that we 

want to use this experience in crafting our legislative language. 

Ms. SIGGERUD. Chairman Oberstar, we did actually do a survey 

of all Metropolitan Planning Organizations for your counterpart in 

the Senate, the Environment and Public Works Committee, and 

61 

have some observations on their capacity and some of the issues associated with this. We would be happy to sure that with you. 

Mr. OBERSTAR. That would be very valuable. Thank you. 

Now I will withhold and recognize the gentlewoman from Oklahoma, Ms. Fallin. 

Ms. FALLIN. Thank you, Mr. Chairman. 

And let me just say, Mr. Chairman, how smart I think you are 

because you have invited the secretary of transportation from Oklahoma to give testimony today. So I have always admired you, but 

now, I admire you even more. 

Mr. OBERSTAR. Oh, boy. 

Ms. FALLIN. I have to brag upon my secretary of transportation 

that is here today. He has done a great job for the State of Oklahoma. Now all the other panelists are wonderful, too, not to take 

anything away from you, but I am proud of my Oklahoma people. 

I had the opportunity to read Secretary Ridley’s transportation 

report, and I am very pleased that Oklahoma has been so aggressive and so on top of getting the stimulus money out the door and 

creating jobs and having their shovel-ready projects available. And 

they have been listed as one of the top five States in the Nation 

as being prepared and able to get the money out. 

I wanted to ask Secretary Ridley a question, though. I was listening to the deputy secretary talk about the difference between obligations and outlays and the amount of stimulus money that is 

being spent in the States. I was looking at Oklahoma’s figures in 

particular, and it seems to be about 50 percent of the outlays are 

now out into the economy versus the obligations, which Oklahoma 

has a high percentage. Out of the $465 million, we have obligated 

$420 million, as you testified, almost 90 percent of our money. 

But are we getting the money back to the contractors, those who 

have been awarded the contracts for the road projects, in a timely 

fashion from the Federal Government, the obligated versus the outlay money? 

Mr. RIDLEY. Congresswoman, and I think it can be attributed to 

several factors: One, that we were able to move very quickly when 

the money became available on the 2nd of March. As the Chairman 

pointed out, the States had the responsibility that a certain percentage of those monies be obligated within 120 days after the 

money became available. 

In our case, we had to have approximately $163 million obligated 

in 120 days, but we were able to open bids on over $200 million 

worth of projects in 19 days. So moving quickly early on enables 

you to have a good, strong construction season, and that is what 

we targeted. We thought it imperative to, even though Congress 

had allowed us more time, we felt if you really want to create jobs, 

you must do it during the construction season and take advantage, 

full advantage, of that construction season. 

Consequently, by now, a lot of the projects have been completed. 

More than 50 percent of the dollars that were allotted to Oklahoma 

have been paid to contractors. They have met specifications. We 

have built—they built the jobs as we have prescribed and as they 

bid, all the testing has been completed. And we are in the process 

of billing the Federal Highway Administration, because it is a reimbursement account, but we are at about $240 million, which is 

62 

a little over 50 percent of the money. And I think it is attributed 

because we moved very, very early in the process. We took the 

Chairman and this Committee and Congress and the President 

very serious on the issue. 

Ms. FALLIN. The Federal—deputy secretary, excuse me, had 

talked about how they want to make sure there is good check-andbalance system on sending the money out to those who won the 

bids once the work is completed. Are they getting their money in 

a timely fashion from us? 

Mr. RIDLEY. Yes, they are. And we feel very confident with that. 

Part of the checks and balances that we did with the recovery 

funds is we split-funded all projects. That ensured that we tied a 

dollar amount, a fixed dollar amount, of stimulus funds to each 

project. And if there were any overruns, cost escalations, supplemental agreements, anything that you would have in the course of 

prosecuting the project, which is very common, that they would not 

be paid with stimulus funds; they would be paid with other funds. 

That ensures that we targeted the stimulus funds for direct accountability. From conception of the project until it is completed, 

the dollar amount of stimulus funds will not change. 

Ms. FALLIN. Thank you. 

If I could ask—is it Siggerud? 

Ms. SIGGERUD. Yes. 

Ms. FALLIN. I hope I pronounced it kind of close. I know you have 

been looking at the jobs created so far. Do we feel pretty sure of 

our tracking method of the stimulus jobs that have been created in 

transportation, the numbers that you looked at, with our methodology? 

Ms. SIGGERUD. We issued a report in GAO a few weeks ago looking at the 1512 process that the deputy secretary described, by 

which all grant and loan recipients must report. In our work, we 

focused specifically on education and highway funds. We found 

that, because of the existing system that is in place, where contractors and State DOTs do report on payroll issues, that there were 

fewer concerns with regard to the quality of the information provided on the highway side than with some of the other kinds of jobs 

that are being reported. 

We do have an ongoing obligation to report quarterly on this job 

creation reporting system. We are going to be drilling down into 

some of the issues that we found, for example, dollars with no jobs 

or jobs with no dollars, try to understand what is causing those 

kinds of data errors. We have also made a number of recommendations to OMB about how to make it easier for the recipients to report accurately. 

Ms. FALLIN. Thank you, Mr. Chairman, I appreciate the extra 

time. 

Mr. OBERSTAR. I appreciate your comments at the outset. 

You may have overstated some things, but Mr. Ridley was selected because it was felt that Oklahoma has a great story to tell. 

And we asked AASHTO to recommend also a witness, but I 

thought that Oklahoma being right up at the top would have some 

good words of wisdom for us, and thank you. 

You may be working for Ms. Fallin if things go her way. 

63 

Mr. OBERSTAR. Mr. Shuster, do you—and I also want to observe 

that Pennsylvania is number seven, just by a hair, in our ratings, 

but that is also because you had commissioner Al Biehler, who was 

the president of AASHTO for the past year and who really made 

things hum. 

Mr. SHUSTER. He does a great job for Pennsylvania. 

Mr. OBERSTAR. Yes. 

Mr. SHUSTER. I wanted to probably ask four of you, Secretary, 

and the different transit authority, aviation, and of course the private sector, what kind of—we talked a little bit about it. The secretary touched on the speed to get projects going, get them turning 

the ground, getting projects out there and getting people working. 

What are the types of things that you see we can do? And you mentioned about when the State and the Federal and the local government gets serious about it and focused on it. Can you talk a little 

bit about that, what we need to do and how we can solve the problem of slow movement on these projects? 

Mr. RIDLEY. Congressman, I think if everyone realizes that this 

is a priority of the Federal Government and certainly a priority of 

State government, then things can happen very quickly. 

The Chairman had a tragic event that took place in Minnesota, 

and everyone stayed focused on that endeavor to put that bridge 

back, and it moved unbelievably quick. 

We had a similar experience, and we were contacted by the Minnesota DOT shortly after the bridge went down. A bridge on Interstate 40 back a few years ago, a 500-foot long span of interstate 

bridge that had been knocked down, we were able to put that 

bridge, from the time it went down until the time we cut the ribbon 

on it to open it up was 64 days, 2 hours and 40 minutes. You can 

do that if you stay focused and if you stay focused on the task at 

hand. 

Let me give you one simple example, I think, that can work, that 

did work for us anyhow, in the recovery plan. One of the things 

that the gentlewoman to my right had mentioned is the sequence 

of events that take place, that you have to have a project authorized, obligate the funds, authorized by the Federal Highways, before you advertise, collect bids, award the project, and then construction starts. But some of that can be done at the same time. 

You can advertise; I think the Federal Highways has the authority 

to do so, and they allowed us to do under the stimulus package. 

You can advertise prior to the project being authorized, as long as 

you don’t take bids or award the project until it is authorized. That 

enables you to move up sometimes as much as 30 days. That 30 

days may not seem like much, but if you think about that is 30 

days of construction time in the heat of the summer and the 

amount of work that you can get done with an extra 30 days of 

summertime construction season as opposed to waiting 30 days and 

now you are into the winter months, and now a day in the summer 

is worth 3 or 4 days in the winter for construction. 

So just that simple event can save you an unbelievable amount 

of time if you are looking at it, not on one project, but on your 

whole realm of projects that you do. So just, again, I think there 

are things that if agencies can come together and really get serious 

64 

about it, I think you can find that there are some ways to still do 

all the things that need to be done but do them quicker. 

Mr. SHUSTER. Ms. Andolino, she is nodding her head vigorously. 

Why don’t you comment on that? 

Ms. ANDOLINO. Well, I think there are a lot of the same synergies 

in both aviation as well as in the highway. One of the things we 

were able to do is, the FAA got their message out quickly. And so 

the collaboration and the communication was extremely important. 

They handled it as if the stimulus money or the Federal Recovery 

Act money, the same way in which they handled AIP funding. So 

we knew going into this that this was going to have to be DBE 

Federally funded type of a job. We added that component to an existing bid that we were putting out on the street; kept it separate 

with the other types of funding that we also were using towards 

this job, whether it was general revenue-backed bonds, passenger 

facility charge funds, or AIP funds, and now you had another component, which was the American Recovery and Reinvestment Act, 

and for us, it was the 12.2. 

So using that methodology, we were able to keep things moving, 

we were able to advertise, bid, and award. We kept that award separately until we then received actual approval from the FAA to say 

we could move forward and we were awarded the funds, and it was 

fully funded. So that job was completely funded, and we were able 

to move forward. So the communication was key and the continuity 

of how they do their other job, so nothing really changed. There 

was a change in the sense of some of the reporting, additional reporting that they required, but the bidding process itself was the 

same, which was good for the end user, us. 

And that continuity was, again, extremely important. If it continued with additional monies, we would appreciate that, but what 

could also help, as I said in the statement, was getting additional 

funding, like the increase in the PFC. So I think what is really important is that long-term benefit to the working person; being able, 

for the contractors to be able to hit the ground running and purchase their materials. Because our contracts, in many cases, some 

were $150 million bids, and some were $2 million or $1 million. So 

we have a lot of work going on under the O’Hare modernization 

program. And more work as part of or CIP, but for the contractors, 

they need to be ready to go. They need the stability. So the interest 

in the PFC provides that stability because the airports can put 

forth their plans, their long-term plans, and contractors can respond more holistically. 

And I think one more thing to note is that, when we first broke 

ground on the O’Hare modernization program in 2005, it was hard 

to get one or two bidders. We usually got, we got one, and then we 

were always praying for two because it was a much more competitive price. In 2008, when we bid out our 210 center projects we had 

an upwards of 5 to 6 bidders on these jobs. And on smaller jobs, 

ones that were under $100 million, we had in some cases close to 

10 bidders in the current environment. 

So that just shows, to the Chairman’s statement before, there is 

a ton of capacity out there. These contractors need the work, and 

as an end user, when you see that many bidders and the change 

65 

so rapidly from 2005 to 2008, you know that they can handle additional work. And all we need to do is provide them the funds. 

Mr. SHUSTER. Mr. Calabrese. 

Mr. CALABRESE. Thank you. 

Really going to add not much new to the situation. I think the 

situation for public transit for our agency was the same, function 

of communications, prioritization with our partners, primarily the 

FTA and the local MPO. On the bidding situation, exactly the 

same. One, two, three bids were probably more the norm, and as 

time went on, certainly last year, more and more bidders and better competition. The only delays we had were because bids were 

coming in so low, and we were moving more projects up to the first 

tier, we had to do amendment changes to allow that to happen. 

That did take some time, a little learning curve in the process. So 

far the process has been very smooth and working better as we 

move on. 

Mr. SHUSTER. Mr. Van Buren. 

Mr. VAN BUREN. I will just speak to the capacity issue there. I did a job last Thursday with 17 bidders on it. It was a $3.2 million 

bridge job. We are doing that every week. 

Mr. SHUSTER. Where are they coming from? 

Mr. VAN BUREN. There are coming from, as the Chairman pointed out I think earlier, they are coming from other market segments. If you are not going to be able to build a sports stadium or 

a build a parking garage or build an office building, you have the 

structural people to be able to build public bridges, and this was 

a bridge project. 

But we are seeing it on the blacktop projects as well. If you are 

not going to build a shopping center or a residential subdivision, 

then you have the paving crews available. So jobs that we would 

normally see two or three bidders on, we are seeing six and eight, 

on the paving side of things. On the construction side of things, 

there are probably two or three extra bidders. And on the bridge 

side of things, pretty consistently since the beginning of this year, 

we have been seeing numbers in the teens, which, you know, 

speaking on behalf of the industry, I think that is a wonderful 

thing. I think it keeps the system going. 

But the unfortunate thing is, when you have 17 bidders and only 

1 job, only 1 person walks away with work. And you have 16 other 

bidders that clearly wanted the work when you look at the pricing 

of the job. You can have times where there are 10 bidders, and the 

last 8 bidders weren’t nearly as interested in the job as the first 

2 bidders were. But in this scenario, you are seeing at least half 

or more of the bidders very, very interested in trying to keep their 

employees busy, and that is what is happening out there right now. 

Mr. SHUSTER. Thank you very much. 

Mr. OBERSTAR. That is very, very instructive testimony, and very 

important questions, and I thank you for raising those issues. 

I want to come back, Ms. Andolino, is there something—I cited 

this earlier, that there is something different in the way in which 

airport authorities advertise for bids. They have broader authority 

than State DOTs have on the highway program. Secretary Ridley 

a moment ago said, we can advertise. We can receive bids, but not 

award bids, and that saves us 30 days time at least. 

66 

Several of the airport authorities in my district said they can 

even award the bid, but you just can’t start working on it. They can 

hold that bid; they can get the contractor to hold that price for up 

to a year. Is that a common practice, or is that just unique to Minnesota’s experience? 

Ms. ANDOLINO. What it is unique to is the authority component. 

Chicago O’Hare is a city entity. It is not an authority, so we go by 

the city’s municipal code. So we have to, as well; it is a design, bid, 

build, and you have to have full funding when you go to advertise. 

So you have to have all the money in the bank in order to advertise 

even for, so they can guarantee the work will be paid. So our process is different than authorities. 

But on bid holding, in a robust marketplace, and I am sure Mr. 

Van Buren can probably attest to this even further, a contractor 

would be a little bit reluctant to hold the bid for more than 6 

months in many cases, especially during the time frame of the high 

and robust building season, when steel prices fluctuate, wood, as 

well as fuel. They wouldn’t hold a bid for too long, depending on 

what the raw materials were. 

In this marketplace, what we are seeing today is, and we actually had to ask a contractor at one point, due to some litigation we 

faced in our acquisition area, to hold a bid for a longer period of 

time, greater than 6 months, and they were more than willing to, 

due to the fact that if he lost it, he lost work. And therefore somebody else then could obtain that work, and I don’t think he was 

willing to put his people out on the streets. So he was willing to 

hold it for a greater period of time than what you normally would 

see. So this marketplace, I think, is what will determine that. 

And we saw, again, in 2008, the numbers, our engineers’ estimate on the OMP, those bids came in well under our engineers’ estimates, because that is when the market started really changing. 

And again, you had much more competition because people that 

maybe normally didn’t bid on a lot of government jobs, perhaps because they did more private-sector work or they were doing a lot 

of the vertical versus horizontal work, started repositioning their 

business planning, getting into the market where there was work. 

And you saw new entrants. When we got 6 bidders on some of our 

over $100 million projects, that was very, very rare for us. And 

some of them were names we had not seen in our marketplace before in our types of bids. 

Mr. OBERSTAR. That is all very valuable and very important information. As I said earlier, I am going to, as soon as this transcript is printed up, which I hope will be in the next day or so, I 

am going to send it—we will have it hand carried over to the White 

House so they can see and understand what is happening in the 

real world. There are some people who are not living in the real 

world, and they have got to get them out of their limousines and 

make them walk. 

Anyway, the additional factor is that you are creating capacity 

at O’Hare. By improving runways and taxiways at smaller airports, 

they are also creating additional capacity, even in this downturn in 

the economy, that will be available when things start turning 

around. You can’t just go back and rebuild these projects overnight. 

So you all are going to be ready. 

67 

Mr. OBERSTAR. Secretary Ridley, it was very instructive to hear 

you say the State DOTs could advertise, receive bids, hold the 

award, save time, from my notes of your comments. Did your DOT 

staff continue their work on the 80-20 program? Was their work on 

your regular program in any way impeded, slowed down, staff deterred from their work by this additional layer of projects? 

Mr. RIDLEY. No, sir, we did not. We were able to let all the 

projects scheduled for Federal fiscal year 2009; they were all let on 

time. The key was that we did not hire additional staff at the Department. What we did was take advantage of the private sector. 

We hired several firms to provide us plans to get ready for the Recovery Act. We did that in October or November to get ready for 

the piece of legislation that we really knew was going to happen 

or that we really thought was. But it didn’t hurt us to go ahead 

and design and have them ready to go, because they were all 

projects that were in our 8-year construction program. So if nothing 

happened here in Congress, we would have had projects on the 

shelf, ready to go for the future. So it wasn’t an expense that we 

would have lost. 

The other advantage, Mr. Chairman, if I might, that we don’t 

talk about a lot and I don’t hear much about is that all States, and 

I would imagine it would be similar to us, that they had projects 

in the queue in their 5-year plan or 8-year plan—we just happen 

to have an 8-year plan—that when we moved all of the projects 

that we were able to fund with stimulus funds that were out there 

3, 4, 5 years in the future, move them all forward, that enabled us 

to take other projects that were in our 8-year plan and move them 

forward as well, even though they weren’t funded with stimulus 

funds, but it created holes in our plan that allowed us to move 

those forward; at the same time, add additional critical projects to 

our 8-year plan. 

It was kind of like a domino effect. It wasn’t just the projects 

that we did with the stimulus funds that were affected, but it was 

all the other projects in our 8-year construction plans were affected 

as well, and by adding additional work. 

We rebalance our program every year, and we were able to do 

this last summer. It really was a benefit to the State. 

Mr. OBERSTAR. Thank you. I think that is an excellent explanation and instructive for where we go from here, but I also liked 

your observation that you really believed that we were going to do 

something. 

We moved a bill in this Committee early in 2008, moved it 

through the House floor at $60 billion, half of which was our committee’s work. Regrettably, the previous management at the White 

House said they would veto the bill if it ever got to the President. 

And then we had an election and reaffirmed the work that we were 

doing. 

So all of you DOTs, your colleagues all around the country, said, 

This is for real. We will gear up. We had meetings in December out 

here. Our Committee and I participated and I met with Mr. Beeler, 

who was head of AASHTO at the time, and he brought DOT secretaries from around the country, laid out what we expected of you. 

And, to your credit, you moved ahead. We did the same with AssoVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00139 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
68 

ciated General Contractors, did the same with the airport authorities. 

So coming back to how you get these projects out fast, that is one 

way to do it; have a hundred percent Federal funding, have an expedited program timeframe within which to do it. I think the ′′use 

it or lose it′′ proposition also scared some people. We don’t want to 

be held up to ridicule. Our Governor a few years ago, Jesse Ventura, gave $175 million 

back to the Highway Trust Fund because he failed to do some 

things. We looked like the Good Will Industry of transportation. It 

was absolutely absurd. And I know that others didn’t want to repeat that experience. 

And then the third lesson, you mentioned the I-35W bridge. Tom 

Sorel, our commissioner, and for whom I have enormous regard, 

did something very unique. The contractor, Flatiron Construction, 

rented a building near the job site, about two blocks from the job 

site, and they took a whole floor and on one end of the floor was 

MNDOT, in the middle was the Federal Highway Administration 

district engineer or division engineer from Minnesota, in the other 

end was Flatiron. When they had a problem, they simply walked 

the plans from one end of that corridor to the other and sat down 

and said, How do we fix this, how do we get this done. They didn’t 

send memos, they didn’t send couriers. Their top engineers walked 

from one end of the corridor to the other, talked with each other, 

or met halfway, and they resolved it right there. 

There is a lesson for us for the future of transportation. It is not 

good enough just to site this project, this bridge rebuilt, or yours 

in Oklahoma, which Ms. Fallin told me about, including right after 

our Minneapolis bridge collapsed. We have been through that. We 

can help you with that. She had some good ideas. But some way, 

somehow we need to incorporate that experience into our future 

Surface Transportation Assistance Act. 

Mr. RIDLEY. Mr. Chairman, that is correct. The lessons learned 

in a stressful situation, in an emergency, if you will, should be lessons learned that you use on a routine basis. The work that your 

State did, hopefully the work that our State did, the Queen Isabella Causeway in Texas, the disasters that they have had in California, and the way State DOTs can react to emergencies is the 

same type of focus that needs to be on everyday problems. 

Mr. OBERSTAR. That is excellent. Help us with that. What are 

your ideas? You may want to talk to Ms. Siggerud and share your 

experience. We need all the help we can do because we want to do 

this thing right. You also said you did a few large, complex 

projects, if I quoted you rightly. Did you have any difficulty getting 

those large, complex projects under contract? 

Mr. RIDLEY. No, sir. Two of the large projects, one was for about 

close to $60 million, the other one was a shade over $70 million. 

We were able to let those to contract. You all provided us the funds 

that were available on the 2nd day of March. And those projects 

were let out to build, I believe both of them, within 45 days after 

the money was available. 

The key in each one of those was that we did not have to acquire 

any right-of-way, move any utilities. The environmental process we 

did very quickly. Because of that, consequently we could rebuild, 

69 

and that is what we are doing, rebuild interstate, on its existing 

footprint and rehabbing or replacing, on one project, 40 interstate 

bridges, a major project in an urban area in the City of Tulsa that 

is ongoing, and we fully expect to have that project completely completed by this time next year. Again, it is about a $75 million 

project. 

Mr. OBERSTAR. That is good to hear, too. You said moving 

projects forward in your 8-year plan creates holes into which you 

can move other projects for longer term construction and bidding 

process. What percentage, just roughly—I won’t hold you to it, because off the top of your, obviously—of your state-of-good-repair 

projects do you think you will have been able to complete through 

this period of the stimulus funding? 

Mr. RIDLEY. On the State system, Mr. Chairman, we estimate 

about 80 percent of our projects are major reconstruction, rehabilitation, or replacement. Twenty percent of the money spent was on 

either pavement preservation projects, asset preservation projects, 

if you will, the ones you talk about to put in good repair, but it was 

about an 80-20 split on the State Highway System. 

Mr. OBERSTAR. Will you have drawn down your portfolio of those 

state-of-good-repair projects, a good portion of it, by the end of this 

Recovery program? 

Mr. RIDLEY. If I understand the question right, will those 

projects be completed? 

Mr. OBERSTAR. No. Will you have taken them off your inventory? 

Mr. RIDLEY. Absolutely. We have two programs. One is asset 

preservation and the other one is our 8-year construction program. 

Absolutely, sir, those were all projects that were in the queue. 

Mr. OBERSTAR. I know in the language of the trade you call it 

critical asset preservation. I call it critical asset investment in my 

transportation bill. We are creating for the future. We take these 

108 categories of Federal programs, compress them down into four 

formula programs, one of which is critical asset investment, which 

is something I have heard for 20 years from every State DOT in 

the country. We have this big backlog. We want to draw that down. 

So now you have got the money. You have had them designed for 

years at some stage or another. Now you are getting those accomplished. And what I want to know for the future is how much of 

that is going to be left, or do you still have an awful lot on the shelf 

needing to be done? 

Mr. RIDLEY. Mr. Chairman, Oklahoma has a great backlog of 

transportation needs. 

Mr. OBERSTAR. And you expect that is about the same for other 

States? 

Mr. RIDLEY. I would imagine so. When we built the interstate 

system—I was part of that in the sixties and the seventies—and we 

forgot it. And we built it and we kind of forgot them. Our interstate 

system in some areas, not only in Oklahoma but other places 

around the country, is an embarrassment. Certainly, the bridges 

that we built on the interstate system back during that time are 

of age and require major rehabilitation and, in some cases, replacement. 

So it is a daunting task that all of us face, not just in Oklahoma 

but throughout the country, to invest in the system. It is certainly 

70 

our belief that the Federal Government needs to have a hand in 

both the financial responsibilities and direction of the national system. I think that lessons learned there are the same lessons that 

were learned in the early fifties, late forties, when it was decided 

that we needed a national system. We have that similar problem 

today on the highway system, but it is a matter of rebuilding it 

now. 

Mr. OBERSTAR. That is very helpful and a very, very thoughtful 

response. We didn’t forget. We built the interstate over 50 years 

and then most of the traveling public thought it was built forever. 

Like the Romans and the Appian Way. There was a bridge in the 

heart of Rome that was built 2,300 years ago. It is still in operation. But it is only the width of a horse-drawn carriage. It is built 

of marble. It hasn’t been destroyed by earthquake or acid rain or 

salt or snow or freeze-thaw cycle, which we all have to go through. 

So there are some structures that do last near eternity, but for 

the rest of it we have got to rebuild it. Every year we have to replace about 15 percent of the interstate. 

Now, Mr. Calabrese, transit operating funds is a vexing issue. In 

the Recovery Act we had a provision allowing 10 percent of transit 

capital funds to be used for operating assistance. There is an appeal for raising that threshold. To what level would you think? 

Mr. CALABRESE. Well, Mr. Chairman, let me first say that the allowable 10 percent was a Godsend, for the reasons I mentioned 

previously. I know there are both tremendous amount of infrastructure needs out there, particularly good state of repair, and the operating needs. I think you want to keep the amount of flexibility 

in funding both reasonable and predictable. 

One idea I had, just an idea, and this is my personal idea, would 

be at least on a temporary basis—and with the next reauthorization—as we have allowed traditionally the use of capital money for 

the preventive maintenance of vehicles, if we could classify fuel as 

a preventive maintenance item, maybe for the electricity to run my 

trains or the clean diesel to run my buses, that would help address 

operational pressures. It is manageable. It is predictable, depending on the cost of diesel, which, maybe somewhere in the 5 to 10 

percent of the operating budget’s range on an annual basis, depending on the system, but that could be something at least as a 

temporary fix. 

That idea came from a frustration I have had in working with 

our local MPO, that is wonderful. If you are out there, I love the 

local MPO. But there is often excess CMAQ money available. 

CMAQ money is a form of money the MPOs have that probably 

doesn’t have as much demand as the STP money, which is broader. 

I have often felt, Why can’t I use CMAQ money to buy clean diesel 

fuel, because certainly if I am running a bus, I am reducing congestion and improving air quality. 

I don’t know if that is a legislative obstacle or an administrative 

obstacle, but the use of fuel which is common, which helps the big 

systems and the small systems, might provide at least temporary 

relief until the recession is over. 

Mr. OBERSTAR. Thank you for that observation. We have in our 

authorization bill, there is a tension between the large metropolitan entities and the smaller ones, those 50,000 or less, those under 

71 

200,000. The smaller ones want that authority and have a broader 

authority. Current law will expand that. The larger ones have said, 

Don’t even give us that authority because then our local government says, Oh, use your capital funds and not that revenue that 

comes out of our local budget to provide operating assistance. So 

that is something you have to help us with. 

Mr. Shuster. 

Mr. SHUSTER. Along the same lines, I am looking at some numbers and it appears that Cleveland is the only transit system that 

uses the maximum amount. Other systems have not used that. 

Just curious. I think along the same lines I have heard people saying that we want to use them for capital expenditures. My concern 

is that if we continue to give you more, people are going—transit 

systems are going to continue to use it for operations instead of 

getting it from the people that should be paying for operations, and 

that is the folks that are using the system. 

Mr. OBERSTAR. Exactly. I supplement Mr. Shuster’s comment by 

saying the original principle of this partnership was that the Federal Government would help local agencies with the capital account. That is the biggest expense. So then you operate it and you 

run it out of your own funds. Am I right? 

Mr. CALABRESE. I understand. The capital side certainly isn’t the 

major side. I think and I know you do have a lot of respect for myself and my fellow colleagues, because every situation is different. 

Our situation in Cleveland, as I was just e-mailed this morning, 

our sales tax is our primary source of revenue. We are blessed with 

a source of local funds called the local sales tax. 

The issue is, because of the recession, we are down $18.9 million 

from last year. So my choices were very simple: I either cut an 

awful lot of service, lay an awful lot of employees off, and prohibit 

a lot of my customers from getting to work, or use that flexibility, 

at least on a short-term basis, to at least try to maintain as much 

service as I can. And that is the decision we made. 

Every year is going to be different, every city is going to be different. I know when I ask my customers, they say, Try not to cut 

my service because I lose my house, I lose my job, I go into foreclosure. 

So we are doing everything we can as good managers, not only 

freezing payroll for my administration and then reducing our pay, 

to try to keep as much service on the road, and that was a tool 

available to us that we had to take advantage of this year. 

Ms. SIGGERUD. Chairman Oberstar, the data we have on RTA indicates that less than 1 percent of the transit capital assistance 

program funds in the Recovery Act are going for operating costs. 

I think that this provides an interesting opportunity to try to figure 

out why. It may be what you said, is the need to protect that capital side of the budget or it may be that because these funds are 

temporary, transit agencies haven’t wanted to use the funds for operating and then need to replace those funds later when these 

funds expire. So it is an opportunity to look into the issue a little 

bit more as a case study here in this act. 

Mr. OBERSTAR. A very good observation. There was another principle involved because, since in the Recovery Act we are using general revenue funds, I felt it would be appropriate to have an inVerDate Aug 31 2005 14:59 Apr 30, 2010 Jkt 000000 PO 00000 Frm 00143 Fmt 6602 Sfmt 6602 P:\HEARINGS\FULL\12-10-09\54019.TXT JASON
72 

crease in authority for transit agencies to use those dollars for operating account because on the one hand—the idea of this program 

is to createjobs, right—or save jobs. So on the one hand, the transit 

agency, one of our witnesses, I think it was from Atlanta, the Director of the Atlanta transit agency, said we will buy some new 

buses. But, at the same time, we may have to lay off workers. So 

on the one hand we are stimulating the economy and on the other 

hand we are destimulating it. 

When you get into our long-term transportation bill, though, 

those are Highway Trust Fund dollars, for the most part, that are 

going into transit agencies. And the principle this Committee has 

followed is, as in the highway program, those funds should be used 

for capital investment. Only in the mid-1970s did we begin to expand use of Highway Trust Fund dollars for repair and maintenance. Initially that was not part of the authority under the Interstate Highway Program and the Highway Trust Fund. 

Mr. Van Buren, I know in talking with the Sand and Gravel Institute and with the Associated General Contractors, both their 

Washington staff and their members across the country, that a 

great many sand and gravel operations and aggregate plants were 

shut down and some mothballed. When they heard about the stimulus, they said, Well, maybe there’s hope for us to come back. And 

they began to ready their operations. Some of those that cut back 

were then able to move their workers from part-time to full-time. 

Can you, as you heard Ms. Richardson earlier ask GAO whether 

they can quantify jobs saved as distinguished from jobs created, 

workers called back to work, is there some way you can do that? 

Mr. VAN BUREN. Mr. Chairman, thank you for that question. I 

very much appreciate giving some input relative to this. From a 

construction worker’s perspective, they work hour to hour, and day 

to day, week to week, month to month is not what they are looking 

at. They are really working hour to hour. That is what, as a contractor, as an aggregate supplier, as a bridge beam producer, that 

is what we can track. 

I am not sure if I can genuinely sit up here and say that if I go 

hire a carpenter that used to work for another construction company 3 weeks before, but he was laid off, if I created a job or not. 

But let me go to your snowmobile scenario that you threw out 

because, ironically, that is exactly the scenario I have been talking 

to most of our Pennsylvania legislators about. 

Our construction in Pennsylvania is very seasonal, and the goal 

of every seasonal construction worker in Pennsylvania is to work 

until Thanksgiving, and then they are very happy. They have work 

for 9 or 10 months and then they are laid off. That is a good year, 

a good season for a construction worker in Pennsylvania. 

In 2008, we shut down almost every one of our quarries and sand 

operations in Pennsylvania in the very beginning of October, the 

first week of October. So that is 8 weeks. Those 8 weeks are not 

like 8 weeks in March, in April. Those 8 weeks are about 400 

hours. There is probably 10 hours of overtime every single week. 

Those are 50-hour weeks. We are trying to beat the Thanksgiving 

deadline, we are trying to beat the weather. And I speak for Pennsylvania, but this is true of any northern State that has seasonal 

construction. 

73 

Mr. OBERSTAR. You could be talking about Minnesota. That is 

our situation right there. 

Mr. VAN BUREN. And so this is the bread and butter. October 

and November is the money that they are going to buy your snowmobiles, which we have the good fortune of having in Pennsylvania, the four-wheelers that we have in Pennsylvania. We are in 

an area that have boats. This is the discretionary spending that 

our workers have. I talk to these guys every day because I employ 

3,200 of these individuals, and this is their discretionary spending 

that they are going to get. If they are laid off in October, there is 

no discretionary spending. As I have said many times, it makes for 

some very unpleasant Christmas and holiday seasons, because they 

don’t have that money. I am not trying to bring tears to anyone’s 

eyes, but they are not buying the Christmas presents they normally would buy for their kids. 

Now you can say, So what? But in these small communities I 

might have in central Pennsylvania 20 workers from New Enterprise all living in Everett, Pennsylvania. Well, if they are not 

spending and buying two or threefour-wheelers, a big four-wheel 

drive truck, a boat, a Ski-Doo and a snowmobile, that is the trickledown effect. So I am not pushing that money back into the economy. If they are on unemployment they are scraping every penny 

to make mortgage payments, buy food. They are going to start their 

winter layoff cycle a heck of a lot earlier. They are probably going 

to run out of benefits in March, which last year we had to actually 

extend benefits gratis on New Enterprise for about 20 workers. Because the stimulus was coming, we didn’t want to lose them to any 

other industries, and so we pushed their benefits for them, gave 

them free benefits up until we were able to call them back in May 

and June. As a company we can’t do that every year, but we knew 

the stimulus was coming, we knew there was going to be work, so 

we were able to look that far forward. 

So in 2008 we are laying off the beginning of October. This year 

our layoff was about, on average, 6 or 8 days before Thanksgiving. 

So with the stimulus dollars we were able to push, leave the quarries open, have the hot-mix plants hot, and have construction workers that are in the market segment of where a lot of the stimulus 

dollars went in Pennsylvania, which was the bridge rehabilitation 

and the asphalt program. We still do have heavy highway workers 

out building big bridges in Pittsburgh and doing some of the major 

reconstruction work, but that is because Pennsylvania has been 

able to maintain their base program and overlay the stimulus on 

top of it. 

So that is really the lifecycle of an employee. And, for me, at any 

point in time to say that is a new employee versus that is a ′′saved′′ 

job, they don’t look at their jobs that way, because they are transient. Whether they are working for me or whether they are working for one of my competitors, if I don’t have work, they are going 

to try to work for my competitor. Now if they go from me to my 

competitor, does he create a job? 

No. The stimulus produces construction worker hours. They are 

hourly workers. I may put on another accounts receivable person 

in my office. That is a trickle down. That is an add-on job. Design 

firms are going to be designing. When the jobs are obligated, we 

74 

haven’t created an immediate construction job, but we are going to 

once the job is awarded. There are a lot of upstream jobs from the 

point of obligation. So I cannot count. And when you were having 

that discussion with Congresswoman Richardson I was kind of 

cringing sitting over there because if I have to try to document 

whether it is a new employee or the salvation of an existing employee’s job, I am going to have a very, very difficult time as a contractor and a materials supplier. 

But I can tell you that we have been tracking hours. The very 

last, as I collected data for this particular testimony, the last email that I got from my payroll clerk that was giving me data said, 

Jamie, real interesting, real quick. Your blacktop division at New 

Enterprise, which is about 200 people, if I add the stimulus dollars 

that they received, because we are tracking that in accordance with 

the documentation required, if I add that payroll to the other payroll that they get for all the other work they have, it equals what 

they made in 2008 collectively. 

So I can tell you almost dollar-for-dollar. And when he sent me 

the e-mail I wish I had saved it because I would like to have been 

able to read the actual numbers. But our payroll in our blacktop 

division at New Enterprise was almost exactly the same in 2009 

as it was in 2008. But I just can’t really delineate new versus 

saved. But we can track hours for you, and we are more than 

happy to do it. If you want to create full-time equivalents and we 

can turn it into—but hours is what the guys depend on when we 

are talking to the public at large, when you as Congress are talking 

to the public at large, that is what our workers understand. They 

understand hours. 

Mr. OBERSTAR. You have got it exactly right. I am sure, Ms. 

Andolino, you have the same view. That is why in our Committee 

report we report full-time equivalent hours worked. And we have 

them by the millions State by State. And so few people really understand the life of a construction worker. They don’t just stay in 

one place. They move around where the job is. 

Mr. Shuster, do you have any other comments? 

Mr. SHUSTER. One quick question. And I have heard this for the 

last several months or year about the bids coming in way under 

what the engineers project. I was in business so I understand if a 

competitor is desperate, he is going to do it for nothing or maybe 

a little bit just to keep the lights on. 

So I am curious why engineers—again, when you have that situation, that is going to be off but when you can see that cement has 

gone down or oil has gone down, I don’t understand why there is 

so often—and maybe it is just because of desperation. I guess that 

is the question I am looking for. Why are these numbers coming 

in so far off the mark, in your view? 

I would start out with Mr. Van Buren because he is the guy out 

there. 

Mr. VAN BUREN. I think it is really two components, and you hit 

both of them. In 2008, the asphalt went up so high, and it is a 

large component of what the ARRA funds have been spent on, that 

when—my understanding is when estimates are put together from 

engineers they are looking at past jobs and they are trying to factor 

in what they are projecting asphalt prices will be. And so we are 

75 

doing the same thing when we are putting budgets together. Asphalt prices came down so much further than anybody thought 

that they were going to that that does create some piece of that 

miss. 

And the second piece is 17 bidders. I have no gripe being one of 

those bidders. It is a capitalist society and we are out there, and 

our job is to be as efficient with our workforce as we possibly can. 

And if there are 17 bidders, we will attempt to be low bidder whenever possible, and that definitely drives down prices as well. So I 

would suspect from my side that it is the combination of those two 

factors. 

Mr. SHUSTER. It is not the engineers living in the past and not 

being able to—— 

Mr. VAN BUREN. They are doing absolutely as good as they possibly can do. They are looking at data when fuel—asphalt went up 

to $800 a ton and they are putting estimates together last winter 

when fuel then dropped down to $675 a ton and they are opening 

up their crystal ball going, What’s it going to be when I pay for it 

next August? I didn’t know the answer to that. They don’t know 

the answer to that. 

Mr. OBERSTAR. We have a vote in progress on the House floor, 

to be followed by some other activity over there. There are a thousand questions I would still like to ask. 

Ms. Siggerud, I just want you to think about and get back to us 

with the question of this matter of States having to reprogram 

funds because bids have come in lower and what process is there 

that is so time consuming and how can we fix that. 

Ms. SIGGERUD. Mr. Oberstar, we are scheduled to report again in 

February. We will be looking specifically at this issue and working 

with States in terms of understanding what is happening, and we 

will report again in May and give a retrospective in terms of that 

deadline and what happened to meet it. 

Mr. OBERSTAR. Thanks to all of you for your wonderful contributions, thoughtful commentaries, both on the Recovery Act and on 

the 6-year authorization bill, the Surface Transportation Assistance 

Act. 

We are doing our best here. If we just left it up to Mr. Shuster, 

Mr. Mica, and me, maybe we would get it all done this afternoon. 

Thank you very much. The Committee is adjourned. 

[Whereupon, at 3:27 p.m., the committee was adjourned.] 

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