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89–897 PDF 2014

MANAGEMENT FAILURES: OVERSIGHT OF THE EPA 

HEARING 

BEFORE THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

JUNE 25, 2014 

Serial No. 113–138 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 

(II) 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

DARRELL E. ISSA, California, Chairman 

JOHN L. MICA, Florida 

MICHAEL R. TURNER, Ohio 

JOHN J. DUNCAN, JR., Tennessee 

PATRICK T. MCHENRY, North Carolina 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

TIM WALBERG, Michigan 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

PAUL A. GOSAR, Arizona 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

TREY GOWDY, South Carolina 

BLAKE FARENTHOLD, Texas 

DOC HASTINGS, Washington 

CYNTHIA M. LUMMIS, Wyoming 

ROB WOODALL, Georgia 

THOMAS MASSIE, Kentucky 

DOUG COLLINS, Georgia 

MARK MEADOWS, North Carolina 

KERRY L. BENTIVOLIO, Michigan 

RON DESANTIS, Florida 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

JOHN F. TIERNEY, Massachusetts 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

JACKIE SPEIER, California 

MATTHEW A. CARTWRIGHT, Pennsylvania 

TAMMY DUCKWORTH, Illinois 

ROBIN L. KELLY, Illinois 

DANNY K. DAVIS, Illinois 

PETER WELCH, Vermont 

TONY CARDENAS, California 

STEVEN A. HORSFORD, Nevada 

MICHELLE LUJAN GRISHAM, New Mexico 

Vacancy 

LAWRENCE J. BRADY, Staff Director 

JOHN D. CUADERES, Deputy Staff Director 

STEPHEN CASTOR, General Counsel 

LINDA A. GOOD, Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

(III) 

C O N T E N T S 

Page 

Hearing held on June 25, 2014 ............................................................................... 1 

WITNESSES 

The Hon. Sheldon Whitehouse, a U.S. Senator from the State of Rhode 

Island 

Oral Statement ................................................................................................. 6 

Written Statement ............................................................................................ 8 

The Hon. David Vitter, a U.S. Senator from the State of Louisiana 

Oral Statement ................................................................................................. 10 

Written Statement ............................................................................................ 13 

The Hon. Gina McCarthy, Administrator, U.S. Environmental Protection 

Agency 

Oral Statement ................................................................................................. 17 

Written Statement ............................................................................................ 19 

APPENDIX 

June 13, 2014 letter to EPA from Rep. Issa and Sen. Vitter submitted by 

Rep. Chaffetz ........................................................................................................ 70 

Questions for the Record from Chairman Issa ...................................................... 72 

Questions for Administrator McCarthy, U.S. EPA, from Reps. McHenry and 

Meadows ............................................................................................................... 74 

Additional questions regarding EPA negligence in responding to Beale Fraud . 86 

(1) 

MANAGEMENT FAILURES: OVERSIGHT OF 

THE EPA 

Wednesday, June 25, 2014, 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, 

WASHINGTON, D.C. 

The committee met, pursuant to call, at 9:35 a.m., in Room 2154, 

Rayburn House Office Building, the Honorable Darrell E. Issa 

[chairman of the committee] presiding. 

Present: Representatives Issa, Mica, Turner, Duncan, McHenry, 

Jordan, Chaffetz, Walberg, Amash, Gosar, DesJarlais, Gowdy, 

Lummis, Woodall, Collins, Meadows, Bentivolio, Cummings, 

Maloney, Tierney, Clay, Connolly, Speier, and Lujan Grisham. 

Staff Present: Melissa Beaumont, Majority Assistant Clerk; Will 

L. Boyington, Majority Deputy Press Secretary; Molly Boyl, Majority Deputy General Counsel and Parliamentarian; Lawrence J. 

Brady, Majority Staff Director; Joseph A. Brazauskas, Majority 

Counsel; David Brewer, Majority Senior Counsel; Caitlin Carroll, 

Majority Press Secretary; Drew Colliatie, Majority Professional 

Staff Member; John Cuaderes, Majority Deputy Staff Director; 

Adam P. Fromm, Majority Director of Member Services and Committee Operations; Linda Good, Majority Chief Clerk; Tyler Grimm, 

Majority Professional Staff Member; Ryan M. Hambleton, Majority 

Professional Staff Member; Erin Hass, Majority Senior Professional 

Staff Member; Christopher Hixon, Majority Chief Counsel for Oversight; Michael R. Kiko, Majority Legislative Assistant; Mark D. 

Marin, Majority Deputy Staff Director for Oversight; Katy Rother, 

Majority Counsel; Laura L. Rush, Majority Deputy Chief Clerk; 

Jessica Seale, Majority Digital Director; Andrew Shult, Majority 

Deputy Digital Director; Katy Summerlin, Majority Press Assistant; Sarah Vance, Majority Assistant Clerk; Rebecca Watkins, Majority Communications Director; Jaron Bourke, Minority Director of 

Administration; Krista Boyd, Minority Deputy Director of Legislation/Counsel; Beverly Britton Fraser, Minority Counsel; Jennifer 

Hoffman, Minority Communications Director; Chris Knauer, Minority Senior Investigator; Julia Krieger, Minority New Media Press 

Secretary; Una Lee, Minority Counsel; Juan McCullum, Minority 

Clerk; Dave Rapallo, Minority Staff Director; and Ilga Semeiks, Minority GAO Detailee. 

Chairman ISSA. Good morning. This hearing will come to order. 

Without objection, the chair is authorized to declare a recess of 

the committee at any time. Without objection, so ordered. 

The Oversight Committee exists to secure two fundamental principles: first, Americans have a right to know that the money WashVerDate Aug 31 2005 13:15 Oct 06, 2014 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 C:\DOCS\89897.TXT APRIL
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ington takes from them is well spent and, second, Americans deserve an efficient, effective Government that works for them. Our 

duty on the Oversight and Government Reform Committee is to 

protect these rights. Our solemn responsibility is to hold Government accountable to taxpayers, because taxpayers have a right to 

know what they get from their Government. It is our job to work 

tirelessly in partnership with citizen watchdogs to deliver the facts 

to the American people and bring genuine reform to the Federal 

bureaucracy. 

Today’s hearing is in fact critical to our core oversight responsibility. The Environmental Protection Agency is a massive Federal 

bureaucracy that employs thousands of people and regulates approximately 11 percent of the economy directly, but its impact on 

energy effectively regulates the prospect for competitiveness of our 

entire economy. It is an agency with far reaching influence impacting the largest and the smallest corporations in America. 

While the vast majority of EPA employees are honest and follow 

the rules, a troubling trend has emerged: a lack of overall supervision and accountability for those employees who cheat the taxpayers. Let’s consider some examples. 

For years, the top EPA official masqueraded as a secret agent. 

Can’t write this in a script. As a secret agent, a CIA man, while 

running up bogus vacations and other charges, airline tickets and 

the like, on taxpayers. In order to do that, he had to have the willing cooperation of many people, including the EPA administrator 

herself. 

Another top former EPA official received a discount on a new 

Mercedes worth thousands of dollars from a lobbyist with business 

before the EPA. 

EPA employees have been found watching mind-boggling 

amounts of pornography while in the office. EPA supervisors signed 

off on clearly fraudulent time claims for years. And I repeat, EPA 

supervisors knowingly signed off on time sheets for people they 

knew could not work, did not work, and in fact never even logged 

into their computers. 

Critical evidence about possible employee wrongdoing often goes 

missing and investigators lack the necessary cooperation and, in 

fact, find a hostile environment when they try to do their job. 

Even top EPA leadership has, in too many cases, demonstrated 

a willingness to turn a blind eye to egregious wrongdoing rather 

than confront the problem. 

I appreciate the administrator appearing here today to discuss 

the committee’s concerns. We are already dealing with one agency, 

the IRS, that has suffered a devastating loss of confidence of and 

from the American people. My fear is the EPA, without major 

changes, and those changes include how supervisors deal with responsibility for the money and the core rights of the American people, will suffer a similar loss of confidence that hinders their ability 

to carry out their mission. 

I am also concerned that these problems, which the committee 

has detailed in numerous letters and hearings, are not being related to top officials with whom the responsibility ultimately lies. 

Just last week, under oath in a transcribed interview with our 

staff, an EPA top congressional affairs person told us that not all 

3 

letters sent by members or even committee chairmen and ranking 

members actually are seen by the administrator herself. 

It is troubling to me that with the well documented concerns 

raised by this committee and others may not even reach the eyes 

and ears of the person who in fact was nominated by the President 

and confirmed to have that responsibility. If problems known by 

this committee cannot reach the person with the statutory authority, then clearly there is a problem at the very top. Moreover, the 

more we learn about the internal workings of the EPA, the more 

it needs oversight, and an abundance of it. 

Our committee is not the only watchdog that has faced obstruction tactics from employees of the EPA. At a hearing last month, 

the Office of Inspector General described the dysfunctional relationship they are experiencing with the EPA’s Office of Homeland Security. And I want to make sure I say this correctly. The EPA’s Office of Homeland Security has absolutely no statutory relationship 

with Homeland Security and in fact is a creation within EPA that 

does not have statutory authority in any way, shape, or form that 

exceeds or preempts the Inspector General’s Office. And yet Homeland Security has disrupted and prevented the IG from fully investigating employee malfeasance at the Agency. 

The administrator, in response, sent a letter to the Office of Inspector General that further complicates the relationship between 

the offices and allows the Office of Homeland Security to continue 

conducting investigations without OIG involvement. They don’t 

have the statutory authority, they will not quit, and the administrator herself has blessed the reduction in the lawful rights and responsibility of her own inspector general. 

With or without the administrator’s knowledge, the EPA has continued to obstruct congressional investigation by refusing to provide subpoenaed documents. 

During a hearing last month, I made a very simple request to 

Deputy Administrator Bob Perciasepe with respect to a subpoena 

I served to you, Administrator McCarthy, in November of 2013. 

Comply with it. The failure to comply has illustrated an apparent 

disregard for congressional oversight and an unwillingness to accept responsibility for the problems currently plaguing the EPA. As 

chairman of this committee, I intend to use every tool at my disposal to ensure that accountability and credibility is restored. 

Administrator McCarthy, you are here to tell us what the EPA 

can and should be doing to aid in this effort and prevent the waste, 

fraud, and abuse that threaten the Agency’s reputation. 

Additionally, we are joined today, and I am very pleased to be 

joined by Senator Vitter and Senator Whitehouse. We welcome 

them today and we look forward to their testimony. 

We are going to run just a short video to kick this off. I know 

Senator Whitehouse has one too. 

[Video shown.] 

Chairman ISSA. I now recognize the distinguished ranking member, Mr. Cummings, for his opening statement. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. I want to 

remind everyone that this is our watch. We are on the earth today. 

The question is whether we will guard our environment so that, 

when our children’s children’s children inherit it, it will be a better 

4 

environment than the one that was in existence when we lived 

upon this earth. 

Mr. Chairman, today’s hearing is significant because it marks 

the first time that the administrator of the Environmental Protection Agency, Ms. McCarthy, will testify before any committee of 

Congress since the EPA issued its proposed rule to limit carbon 

pollution from power plants. 

The rule, which is part of the President’s Climate Action Plan, 

is a landmark step towards addressing climate change. The time 

for our Nation to take action on climate change is right now; not 

tomorrow, not next week, but now. The science is abundantly clear 

and the evidence is simply overwhelming. This is our watch. 

So I welcome Administrator McCarthy and I look forward to 

hearing more about the Agency’s action on this very critical issue. 

I also welcome Senator Whitehouse and Senator Vitter. It is good 

to have you both here today. Just last week Senator Whitehouse, 

who chairs the Senate Subcommittee on Clean Air and Nuclear 

Safety, held a remarkable hearing with testimony from our four 

previous EPA administrators. They were all appointed by Republican presidents. Let me say that again. They were all appointed 

by Republican presidents. And they all, all four of them, testified 

about the urgent need for the United States to act on climate 

change right now; not tomorrow, not next year, now. 

These four Republican administrators wrote an op ed in the New 

York Times on August 1st, 2013, and let me tell you what they 

said. I didn’t say this, they said it. ‘‘Each of us took turns over the 

past 43 years running the Environmental Protection Agency. We 

served Republican presidents, but we have a message that transcends political affiliation: the United States must move now on 

substantive steps to curb climate change at home and internationally.’’ 

These four Republican administrators endorsed President 

Obama’s Climate Action Plan, and here is what they also wrote: ‘‘A 

market-based approach, like a carbon tax, would be the best path 

to reducing greenhouse gas emissions, but that is unachievable in 

the current political gridlock in Washington. Dealing with this political reality, President Obama’s June Climate Action Plan lays 

out achievable actions that would deliver real progress.’’ 

This is our watch. These words came from officials who served 

in the Nixon Administration, the Reagan Administrations, and 

both Bush Administrations. But the question is is Congress listening. Are we listening? Are we hearing the urgent warnings? Unfortunately, it appears that the answer is no. Republicans have designated this week in the House of Representatives as Energy Week. 

Yet they refuse to consider any legislation to address climate 

change. This is our watch. Instead, they vote over and over and 

over and over again to protect the interest of the fossil fuel industry. 

This is our watch. We have a duty to pass on a cleaner environment than the one we found when we came upon this earth. As a 

result, this week the House of Representatives will take its 500th 

anti-environment vote since Republicans took the majority in the 

112th Congress. Unfortunately, the actions of this committee seem 

to reflect the same priorities. The official purpose of today’s hearing 

5 

is not to address climate change or the response of Federal agencies to one of the most enormous challenges facing our Nation and 

our entire world. Instead, the committee will focus on what appears 

to be an effort to block EPA at every turn and to prevent the Agency from getting anything done. 

Since 2011, Chairman Issa has launched an unprecedented 18 

separate investigations into EPA activities. He has sent 49 letters, 

issued two subpoenas, and held 15 hearings, including this one. 

Today some committee members will accuse Administrator McCarthy of obstructing congressional oversight. But the facts show this 

simply is not true. The EPA employees have testified at more than 

a dozen hearings; they have participated in numerous transcribed 

interviews, depositions, and briefings; and they have produced 

more than 200,000 pages of documents to the committee since 

2011. 

This is our watch. So I want to be clear that some of these investigations are worthwhile. The actions by John Beale, for example, 

of pretending to be a CIA agent while working at EPA are criminal, and they deserve to be investigated and prosecuted, and he 

should be brought to justice. But eventually I believe the committee 

must turn from oversight to reform, because this is our watch. At 

some point history calls on us to take on the greatest challenge of 

our generation, the greatest challenge our generation has ever 

faced in global warming. Ladies and gentlemen, we simply do not 

have the right to remain silent. 

Mr. Chairman, you said in your opening that the EPA regulates 

businesses and affects the economy. I don’t think you mentioned its 

core mission. Its core mission: to protect the human health and the 

environment. I just wanted to make that clear. 

Finally, EPA must fulfill its mission of protecting human health 

and our environment, and Congress should do everything in our 

power during our watch to make sure that they have the resources 

and the tools necessary to do so. 

With that, I yield back. 

Chairman ISSA. I thank the gentleman. 

As we go to our witnesses, I might remind the witnesses that the 

hearing has been designated as Management Failures: Oversight of 

the EPA, which is within our jurisdiction, not global warming. 

Members may have seven days to submit opening statements for 

the record. 

We now welcome our distinguished first panel. As is the usual 

practice of the committee, the Senators will be excused immediately following the testimony and will not be sworn. 

The Honorable David Vitter from Louisiana is the Ranking Member of the Senate Committee on Environmental and Public Works, 

and has been highly involved in the oversight process with this 

committee. 

The Honorable Sheldon Whitehouse, from Rhode Island, is a 

member of the Senate Committee on Environment and Public 

Works. 

Senator Whitehouse, I think you won the straw. You get to go 

first. 

6 

WITNESS STATEMENTS 

STATEMENT OF THE HONORABLE SHELDON WHITEHOUSE 

Senator WHITEHOUSE. Thank you, Chairman, Ranking Member 

Cummings. 

The Environmental Protection Agency is far more popular than 

Congress, and its mission, to protect human health and the environment, is one of the most fundamental and popular responsibilities of the Federal Government. Bad actors like John Beale can be 

found in large institutions, and should be dealt with by the proper 

authorities. But we don’t, in America, impugn the integrity of an 

entire agency and its thousands of public servants. That is a disservice to the American people who rely on the EPA to protect public health. 

Earlier this month, EPA used its Clean Air Act authority, as established by Congress and affirmed by the Supreme Court, to propose carbon pollution standards for the Country’s existing power 

plants. The approach taken in the standards was based on unprecedented public engagement. The EPA held more than 300 public 

meetings, working with stakeholders of all kinds and all across the 

political spectrum. 

EPA has put States in the driver’s seat to come up with their 

own best plan to meet State-specific targets. States and power companies will have a wide variety of options to achieve carbon reductions, like boosting renewable energy, establishing energy savings 

targets, investing in efficiency, or joining one of the existing cap 

and trade programs, each of which strategies has been proven successful in our States. States can develop plans that create jobs, 

plans that cut electricity costs by boosting efficiency, plans that 

achieve major pollution reduction. As proposed, the rule will reduce 

carbon pollution while providing as much as $93 billion in public 

benefit per year by 2030. 

A recent Washington Post ABC News poll found that 70 percent 

of the public supports Federal standards to limit greenhouse gas 

pollution. And just last week the Wall Street Journal and NBC 

News released a poll showing that two-thirds of Americans support 

President Obama’s new carbon pollution standard. More than half 

say the U.S. should address climate change even if it means higher 

electricity bills for them. 

EPA’s proposal is also supported by major utilities like National 

Grid, faith organizations like the U.S. Conference of Catholic 

Bishops, and nameplate corporations like Mars, Nike, Starbucks, 

and countless others. 

As the ranking member indicated, four former EPA administrators who served under Presidents Nixon, Reagan, George H.W. 

Bush, and George W. Bush testified recently before my Senate Environment and Public Works Subcommittee on clean air and nuclear safety. They explained that carbon pollution needs to be addressed immediately, that EPA’s rule is a reasonable way to reduce 

carbon pollution, and that industry has a history of developing innovative ways to comply with environmental regulations in ways 

that cost significantly less than industry’s initial estimates. Indeed, 

some say that those initial estimates are often exaggerated. 

7 

The Clean Air Act, according to a 2011 EPA assessment, will 

benefit Americans more than its costs by a ratio of 30 to 1, $30 of 

value in the lives of regular Americans for every $1 the polluters 

had to pay in cleanup costs. That is a good deal for America. 

I am grateful to Administrator McCarthy for working diligently 

to do what Congress and the Supreme Court told EPA to do, and 

what the American people want EPA to do, to reduce harmful carbon pollution in accordance with the law and the vast preponderance of the best available science. Whatever questions may need to 

be answered, it does not serve the public to interfere with the EPA 

in its performance of this vital, popular, and beneficial task. Indeed, it would be a dereliction of duty on, as the ranking member 

said, our watch. 

Thank you very much, Mr. Chairman. Thank you, Ranking Member Cummings. 

[Prepared statement of Senator Whitehouse follows:] 

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Mr. WALBERG. [Presiding.] Thank you, Senator Whitehouse. 

Now, Senator Vitter, we look forward to your comments. 

STATEMENT OF THE HONORABLE DAVID VITTER 

Senator VITTER. Thank you, Mr. Chairman and Ranking Member 

Cummings and all members, for inviting me to testify before your 

committee today. And I am going to break from the previous two 

speakers. I am going to actually talk about the topic of this hearing; ‘‘entitled Management Failures: Oversight of the EPA.’’ 

As the ranking member of the Senate Environment and Public 

Works Committee, I have a responsibility to oversee the EPA. Unfortunately, under the current majority in the Senate, our committee has yet to hold a single oversight hearing on this important 

matter, contending instead that a perfunctory member’s briefing 

was sufficient. That is why your work and your effort is so incredibly important. 

Now, while there are certainly serious policy debates about the 

Agency and its role in regulating our energy supply, that is not 

what I am here to discuss. That is not what the hearing is about. 

Rather, my testimony will focus on my work over the last year that 

has uncovered what appears to be a systematic breakdown in EPA 

operations that have wasted millions of taxpayer dollars. 

Now, at the very beginning let me emphasize three key points. 

First of all, I am not saying I have never said that all or most EPA 

employees are dishonest or incompetent. I have never said that and 

I have never impugned their integrity. Secondly, I have never said 

that these problems started under this Administration and existed 

under this Administration alone. I have never said that; I am not 

saying that today. But number three, the statement by others, including the head of the EPA, that John Beale was a lone wolf and 

a completely isolated incident, is clearly not true; and the facts 

clearly contradict that. The Beale saga has uncovered major systemic management failures at EPA and has also led to the uncovering of other significant time and attendance fraud, other unrelated 

cases that you have heard about, including in your May 7th hearing. 

Let me give you the history of my work on this matter. In July 

2013, I was contacted by a whistleblower who described serious 

and systemic time and attendance fraud at the EPA. Some of these 

problems involved situations where senior EPA managers discouraged remedial action against chronic offenders because it was easier to ignore the problem than to fix it. Based on this information, 

I requested EPA’s Office of Inspector General to brief me on the 

time and attendance problems they were investigating at the Agency. I was expecting an account of the instances reported by the 

whistleblower, but instead I learned of another case, the bizarre 

tale of John Beale, the fake CIA agent who pled the Fifth in this 

hearing room. 

When we made the Beale saga public, I was aware of the underlying symptoms of abuse going on at the Agency. Therefore, it was 

immediately apparent to me that the Agency’s claim that Beale 

was a lone wolf or an isolated case was just flat out completely 

false, and anybody who argued that he was a solo actor was just 

flat out distorting the truth. 

11 

Since then, I have been focused on uncovering the circumstances 

and management weaknesses that allowed Beale’s fraud to continue for so long, literally for decades. These management failures 

have facilitated wasting millions upon millions of taxpayer dollars 

and undermine congressional oversight. 

In August 2013, I requested the OIG to immediately launch an 

investigation into the Agency’s policies and process that facilitated 

Beale’s fraud and to make recommendations to ensure this never 

happens again. When the OIG issued its report in December 2013 

on Beale’s travel and pay issues, the findings were, in my opinion, 

rather scant and prompted more questions, such as who knew or 

should have known what Beale was up to and when did they first 

reason to believe that Beale was defrauding the Agency. So I asked 

the OIG to show me their work. My staff then poured through all 

of the OIG’s documents and interview notes in hopes of answering 

these key questions. The results of our review were the subject of 

a series of reports issued in February and March of this year, 

which are attached to my testimony today. 

The key findings of these reports include, one, Beale could not 

have accomplished his massive fraud without assistance, knowingly 

or unknowingly, from former and current EPA officials who have 

in no way been held accountable; two, one of the key facilitators 

of Beale’s fraud was Deputy Administrator Perciasepe, who signed 

key documents and contributed to the delay in reporting Beale to 

the OIG; three, the time line offered by the EPA and the OIG that 

concluded Administrator McCarthy was the first person to report 

suspicions of Beale is highly suspect; and, four, other EPA employees had an opportunity to be proactive and should have done more 

to prevent the fraud, but chose to defer to senior officials rather 

than report their concerns to the OIG. 

Now, as I said at the beginning, and I want to emphasize, Beale’s 

fraud stretched through several administrations, Republican and 

Democrat, so it is easy to second guess their actions with the benefit of hindsight. But this does not change the fact that many individuals at EPA had knowledge or were woefully ignorant of Beale’s 

ongoing fraud. These individuals have never been held accountable. 

I also emphasize that certainly most EPA employees are not bad 

apples, are not incompetent, are not defrauding the public; they are 

dedicated public servants. However, when an agency is in the process of aggressively expanding its jurisdiction, regulating something 

as significant as our energy supply, they have a key responsibility 

to make sure that their own house is in order, and EPA’s is clearly 

not. 

Aside from the Beale case, I have learned more about the dysfunction of the EPA, again, thanks to courageous whistleblowers, 

and this has made it abundantly clear again that John Beale was 

not a lone wolf and his case is not an isolated instance. You heard 

about other significant cases of time and attendance fraud at your 

May 7th hearing. In addition, a whistleblower has informed my 

staff that there was a dispute between the Office of Homeland Security and the OIG. When I learned of the dispute, I was immediately struck by the coincidence that the same actors who delayed 

providing the OIG with critical information about Beale were the 

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gator. We now know there are additional instances where EPA employees refused to cooperate with OIG investigations and received 

no reprimand. And I understand that as recently as yesterday, this 

issue is completely unresolved in the eyes of the OIG. 

Because of our joint efforts, a veil has been pulled back revealing 

that wasted taxpayer resources and mismanagement permeates the 

Agency. Given that much of our efforts to uncover waste, fraud, 

and abuse at the Agency derive from the voice of undaunted whistleblowers, I encourage additional concerned EPA staff to come forward at any juncture. We can work together to reform and rehabilitate the troubled agency. 

As my testimony today demonstrates, representatives in Congress do listen and do take action based on information whistleblowers provide. 

In closing, I want to commend this committee for taking the 

issue of waste, fraud, and abuse at the EPA seriously and for holding today’s hearing. It is important that this story come out and, 

because of your work, additional stories of this systematic problem 

have come out and it has demonstrated that John Beale and his 

crimes were just, unfortunately, the tip of the iceberg. 

Thank you very much. 

[Prepared statement of Senator Vitter follows:] 

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Chairman ISSA. [Presiding.] Thank you, Senator. We appreciate 

your coming here to give us testimony, and once again I want to 

thank you for your entire team’s effort in this joint investigation. 

We will now take a very short recess in place for the administrator to be seated. 

[Pause.] 

Chairman ISSA. Our second panel today is Administrator of the 

United States Environmental Protection Agency, the Honorable 

Gina McCarthy. Pursuant to the committee rules, Madam Administrator, would you please rise to take the oath? 

Do you solemnly swear or affirm that the testimony you are 

about to give will be the truth, the whole truth, and nothing but 

the truth? 

[Witness responds in the affirmative.] 

Chairman ISSA. Thank you very much. Please be seated. 

As you know after so long doing this job as a deputy and as the 

administrator, your entire prepared statement will be in the record. 

You may choose to read it or use your five minutes in any way you 

choose. The gentlelady is recognized. 

STATEMENT OF THE HONORABLE GINA MCCARTHY, ADMINISTRATOR, U.S. ENVIRONMENTAL PROTECTION AGENCY 

Ms. MCCARTHY. Thank you very much, Chairman Issa, Ranking 

Member Cummings, and members of the committee. I appreciate 

the opportunity to testify today. 

The EPA’s mission is to protect public health and the environment. It is important to every one of us, and I understand and appreciate this committee’s keen interest in the EPA’s work. In order 

to best achieve EPA’s mission, one of the themes for my tenure as 

administrator has been to embrace EPA as a high performing organization. This means using our limited resources effectively so that 

EPA employees have the tools they need to do the important work 

that we ask of them every day. 

Effective oversight is an important assurance that the Agency’s 

work remains faithful to its mission and its mandates. In support 

of congressional oversight, the EPA works daily to respond to letters and various requests for information from this committee and 

others. Over the last six months, the EPA has produced thousands 

of documents, tens of thousands of pages to this committee alone. 

Cooperation with our overseers is not just EPA’s policy, but it has 

and has always been part of EPA’s culture. 

EPA employees have always provided extensive information and 

support to facilitate the oversight work of EPA’s inspector general. 

The inspector general plays a special role in helping me to ensure 

that the Agency is operating at its best, and I, along with my entire leadership team, remain committed to supporting the important work of that office. 

The responsible and accurate reporting of time and attendance 

agency-wide has been a significant focus for both the EPA, as well 

as our inspector general. Through investigations of the conduct of 

John Beale, the former EPA employee who defrauded the agency 

and is now serving time in jail, we identified several weaknesses 

in Agency systems that allowed that fraud to occur and persist. 

18 

Based on those findings, EPA has taken extensive steps to ensure 

this type of fraud cannot be repeated. 

It is also important to note that even though John Beale has 

been criminally prosecuted and is currently serving time in jail, the 

Agency continues to seek restitution for the fraud that he perpetrated. In addition to the $1.4 million already recovered from Mr. 

Beale during the criminal process, the Agency is seeking to recover 

costs related to unwarranted retention incentives and fraudulent 

travel costs, and we are working to lower his retirement annuity. 

Eliminating waste, fraud, and abuse is critically important to me 

for two reasons: first, as administrator, I believe it is my obligation 

to provide the leadership and stewardship needed to ensure the 

kind of organization that the public servants at EPA deserve; and, 

second, because the work at EPA is so important, the health and 

environmental protections we administer benefit every person in 

the United States. We do this work with public trust and public resources, and we simply cannot afford to fail. 

Nowhere is that more true than in our work to address climate 

change. Climate change is one of the greatest challenges that we 

face. The science is clear, the risks are clear, and the high costs of 

climate inaction are clear: we must act, which is why President 

Obama laid out a Climate Action Plan. And why on June 2nd I 

signed the proposed Clean Power Plan to cut carbon pollution, 

build a more resilient Nation, and lead the world in our global climate fight. 

EPA’s proposed Clean Power Plant is a critical step forward. It 

will cut hundreds of millions of tons of carbon pollution and hundreds of thousands of tons of other harmful air pollutants. Together, these reductions will provide important health benefits to 

our most vulnerable citizens, including our children. 

All told, in 2030, when States meet their individual goals 

through their own flexible compliance path, our proposal will result 

in a 30 percent reduction in carbon pollution compared to our levels 

in 2005. In 2030, the Clean Power Plan will deliver climate and 

health benefits of up to $90 billion. And because energy efficiency 

is such a smart cost-effective strategy, we predict that in 2030 average electricity bills for American families will actually be 8 percent cheaper. 

This is the kind of remarkable progress we can make when we 

have forward-looking policy, when we have engaged stakeholders, 

and when EPA is a high performing, high functioning agency. 

I look forward to answering the questions you may have. Thank 

you, Mr. Chairman. 

[Prepared statement of Ms. McCarthy follows:] 

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Chairman ISSA. Thank you. 

Before I ask my round of questioning, your assistant was asked 

this question more than 30 days ago. I made it clear—you were in 

the back; hopefully you saw the video—that I would hold you in 

contempt if I did not receive one of the two events within 30 days, 

either compliance with the November 2013 subpoena lawfully 

served on you or item by item privilege logs claiming executive 

privilege from the President. Are you prepared to deliver those documents here today? 

Ms. MCCARTHY. Mr. Chairman, EPA remains interested in working with the committee on the accommodation we have put forward—— 

Chairman ISSA. Ma’am, that is a yes or no. 

Ms. MCCARTHY. I am answering the question, sir, as best I can. 

Chairman ISSA. No, ma’am. You are talking about the same 

things you did in your opening statement. You are talking about 

your commitment to comply. I will let you answer fully, but I caution you you have been threatened with contempt for not complying 

with a subpoena from November of 2013. Your deputy was warned. 

You are back here today because in fact no compliance with this 

has happened and no executive privilege has been claimed and no 

log has been produced. So I ask you again are you prepared today 

to deliver the documents consistent with the subpoena of November 

7th, 2013. 

Ms. MCCARTHY. Mr. Chairman, it is my understanding that the 

staff have had discussions as early as just a short time ago about 

this issue. You know we have worked hard to recognize the interests of this committee in ensuring that there is no White House interference in the work between us and delivering documents that 

you require. We have provided an accommodation which we actually shared with your staff this morning, and we are looking to 

make sure that that addresses your needs so that we can avoid institution problems with the request that you made and hopefully 

move on to continue our work together. 

Chairman ISSA. Ma’am, this morning an in camera review of a 

document we knew existed, demanded, was shown. It changes 

nothing. The subpoena calls for you to deliver the document and 

documents. You have not done so. Are you prepared, not to negotiate with Minority staff or Majority staff, are you prepared to deliver the documents or provide an item-by-item privilege log with 

an executive privilege? 

Ms. MCCARTHY. Mr. Chairman, EPA has made no decision to not 

work with you on this issue. In fact, we have been trying very hard 

to do just that, which we know is your responsibility. 

Chairman ISSA. Could you imagine if I just went ahead and set 

up a coal energy plant without a permit and started burning raw 

coal to produce electricity, and then told you for month after month 

after month that I look forward to working with you? The fact is 

this was a lawfully served subpoena. I am informing you today that 

it is my intention to hold the Environmental Protection Agency in 

contempt and to schedule a business meeting to do so at the first 

business day available to this committee, which will be after next 

week. 

26 

Ms. MCCARTHY. Mr. Chairman, I think our accommodation addressed the interests of the committee. I would like to just make 

sure that we can continue these discussions and get a final look at 

that document. Minority staff have looked at it, nor the Majority 

have. 

Chairman ISSA. Ma’am, the President of the United States said 

elections have consequences. During the Minority’s time in the majority under President Obama, no oversight was done. This is my 

watch. This is my time. Elections have consequences. You have not 

complied with the subpoena I am telling you the time to comply is 

now. If it is not complied with, I will, today, schedule a business 

meeting. I will hold that business meeting. This committee will 

consider and vote on contempt at that business meeting unless we 

have full compliance by that time. And, ma’am, there is no negotiation. Negotiation time has expired long ago. It is contemptible for 

months to pass and have you say that you are negotiating. That 

in camera offer, quite frankly, was insufficient. 

Ms. MCCARTHY. I am sorry, Mr. Chairman, I didn’t say I was negotiating. What I am trying to indicate is I certainly respect the 

important interests that your committee has put on the table that 

led to that subpoena being issued. You were very clear. I am trying 

to indicate that there is clear documentation that there was no 

White House interference. And if that can be agreed, then I think 

we can all agree that the important institutional considerations at 

EPA and of the Executive Branch should also be considered and 

hopefully resolved through this process. 

Chairman ISSA. Ma’am, I appreciate that. It is not clear that 

there was no White House interference, so your statement is, in 

fact, your position. It is not clear. So we will have no preconditions 

that there was no White House interference. There is a large office 

at the White House that was formed to, in fact, handle it. The legislative liaisons that we deal with every day work for the White 

House more than they work for you, and that is true of all the cabinet positions. 

So I want to get past that. Obviously we are not going to see 

those documents today. 

Does the ranking member have any comment on the—— 

Mr. CUMMINGS. I do. 

Chairman ISSA. Please. 

Mr. CUMMINGS. In all fairness, I just want to make sure. So, I 

understand the chairman is saying no negotiations and you said 

you understand that. Why don’t we have the documents today? 

Why don’t we? They were available in camera, is that right? 

Ms. MCCARTHY. Well, actually, you have—— 

Mr. CUMMINGS. Well, hold on. I am asking her. 

Ms. MCCARTHY. The entire request that started this process and 

raised concerns, all of those documents have been provided to the 

committee. The question that was raised to us was related to a separate email exchange between EPA and the White House. We have 

certainly shared that in camera with now both sides of the committee, and that clearly shows there was no White House intervention. 

And that was the sole reason for the subpoena, which requires 

five years of any communication between the Executive Branch, 

27 

the Executive Office of the President and EPA relative to any congressional inquiries, which, to me, is a very large task, significant 

taxpayer dollars. And if we have accommodated this request by 

showing that the reason the concern was raised is no longer justified or appropriate and we have addressed that concern, we see no 

reason why we would want to expend significant taxpayer dollars 

on that search. 

Mr. CUMMINGS. Well, obviously the chairman doesn’t feel the 

same way you feel, is that right? 

I yield to the chairman. You don’t agree with what she just said? 

Chairman ISSA. The in camera document indicated I left you a 

voicemail. That is certainly not something we can further verify. 

And this investigation has everything to do with White House interference with the discovery process. When we issue a subpoena, 

the 106 documents that we became aware of because of a whistleblower, when we issue a subpoena, to then go into a series of negotiations, what is going to be redacted and so on, with people at the 

White House is, in fact, now part of the subpoena request. We are 

requesting the communications that went into the production. 

Now, if the President wishes to say that every time he micro 

manages whether we get our documents pursuant to our oversight, 

and he wants to claim executive privilege, he may do so. 

Ms. MCCARTHY. Mr. Chairman, this is a longstanding practice, 

and I am more than happy—— 

Chairman ISSA. Ma’am, ma’am, practices are written in the Constitution. There is no precedent for this. And, quite frankly, the 

longstanding practice that you speak of is a longstanding practice 

that I inherited because for two years the Minority, when they 

were in the majority, did no oversight. My first request for documents was greeted with a please submit a FOIA, as though we 

were the public or a newspaper and had no further constitutional 

oversight. So we have issued a subpoena. It has been lawfully 

issued; it has been out there for a long time. My folks want to get 

to other questions as to your failure to manage those limited resources—— 

Ms. MCCARTHY. Well, Mr. Chairman, I am more than—— 

Chairman ISSA.—so I would like to get past it. 

Mr. Cummings, did you have any other questions? 

Mr. CUMMINGS. She was about to say something. 

Ms. MCCARTHY. I was just going to say I am more than happy, 

if the concern is that we just showed it to you and didn’t provide 

it, I am more than happy to provide this email if that addresses 

the accommodation that we need to protect both of our institutional 

considerations. 

Chairman ISSA. You certainly could make an in camera presentation of all the emails, all of them. And that would allow for staff 

to fully evaluate whether or not the production of all of the emails 

or some of the emails would be necessary. One chosen email is not 

in fact sufficient to take care of it. There has been multiple correspondence. I will never get the voicemail left, but I certainly am 

entitled for my staff to look at all the correspondence with the 

White House related to the production of these 106 documents. If 

that can be done, then we can make an evaluation. We can’t do it 

based on one selected document. I am sure you understand. 

28 

Ms. MCCARTHY. Well, it is just my understanding that this was 

the document that raised the committee’s concern. We addressed 

this—— 

Chairman ISSA. No, ma’am. This was the document that we had 

an advanced copy of that we knew existed that we asked for because we found out it existed because of a whistleblower. The fact 

is there were many more. We want all the documents that exist. 

Now, if there has been hard drive crashes, laptop disappearances 

or other failures or losses, we also want to know about those immediately since, pursuant to the subpoena, there was a requirement 

to preserve documents. And we have done a lot of that this week. 

With that—— 

Mr. CUMMINGS. One last thing. 

Chairman ISSA. Of course. 

Mr. CUMMINGS. It is my understanding that your staff offered, 

months ago, to show these documents to the Majority staff. What 

happened, do you know? 

Ms. MCCARTHY. They did not take us up on that offer, sir. And 

the concern I have is obvious. There are balance of power issues 

here. I am trying to address the issue that was raised to us tat 

raised concern. If this is a larger concern than EPA, I doubt that 

any production we can provide you would quell that concern. And 

I think there are legitimate issues that the Constitution recognizes 

on balance of power, and the appropriation we have offered is what 

we are supposed to do and what we are supposed to have a good 

discussion about and try to reach an accommodation to not tip the 

balance there, because we believe that we need to have confidential 

communications with the White House in a way that allows us to 

be efficient and effective. This would quell that. 

Chairman ISSA. I appreciate that. My staff indicates that no such 

offer to see all the documents was ever given. 

Ms. MCCARTHY. I am sorry, let me clarify. The offer was to show 

you the document you indicated that raised your concern. 

Mr. CUMMINGS. Not the 106. 

Chairman ISSA. Right. And that document raises my questions 

than answers, and it was only shown today in camera. I asked for 

them to look at it in camera, but we never presupposed that we see 

one document; and if it raises more questions than answers, we 

won’t want to see more. 

I am going to go to the ranking member and let him ask his 

questions, but the fact is, Madam Administrator, your entire power 

base, everything you do is in fact a power of the House and Senate 

that has been essentially loaned to the Executive Branch. The decision to decide a new ruling on any part of Clean Air or Clean 

Water, to grant permits, these are all powers of law. So I appreciate you talking about balance of power, but you only exist because a power of this branch has been loaned to the Executive 

Branch. EPA is not an inherent power of the second article branch. 

But I am going to take a break and not ask my own line of questions yet. Mr. Cummings, please ask yours. 

Mr. CUMMINGS. Thank you very much. 

Administrator McCarthy, I want to pick up on this. I have listened to the chairman and I simply disagree with his characterization, but I do not believe you are obstructing anything. I do not beVerDate Aug 31 2005 13:15 Oct 06, 2014 Jkt 000000 PO 00000 Frm 00032 Fmt 6633 Sfmt 6633 C:\DOCS\89897.TXT APRIL
29 

lieve there is a conspiracy with the White House. I believe that the 

EPA has been responsive. You produced more than 208,000 pages 

of documents and the Agency has been trying in good faith to cooperate in all 18 of the committee investigations. However, I would 

like to give you a chance again to respond to any question you may 

not have been able to fully address. Would you like to raise any additional points? 

Ms. MCCARTHY. Well, the only thing I would like to mention is 

that this issue arose significantly through an earlier request for information. We spent considerable time and effort to respond to a 

variety of information requests that were made of us. These 106 

emails were produced within seven days of us receiving the subpoena. The one issue that is outstanding was the committee’s concern about whether or not there was White House intervention on 

the basis of this one email exchange, which we have now shown the 

staff. 

So we think this should alleviate the concern and allow us to get 

to our operation, our business at hand. And if we do that, we work 

very hard with this committee; we take every request seriously. We 

work with staff to prioritize as best we can so we meet the most 

immediate needs. We have produced hundreds of thousands of 

pages of information over the past few years, and I think we will 

continue to try to do that as best we can and hopefully work with 

the committee through this process as well. 

Mr. CUMMINGS. Well, thank you. With that, I want to ask you 

about a much more important issue. As we heard last week, Senator Whitehouse held an amazing hearing with four of your predecessors, all Republican administrators, testifying about climate 

change. They all agreed that our Nation needs to act now. One 

former administrator, William Ruckelshaus, was appointed by 

President Nixon. He said, ‘‘The four former EPA administrators sitting in front of you found that we were convinced by the overwhelming verdict of scientists that the earth was warming and that 

the humans were the only controllable contributor to that phenomenon.’’ 

Ms. McCarthy, how significant is it that all of the administrators 

came together to advocate for action on climate change? 

Ms. MCCARTHY. I think it is very significant, sir, and I also am 

not surprised by it, frankly, because the science has been clear for 

quite some time. I think the best thing about it was in hopes of 

getting partisan politics out of the science debate and moving forward to take a look at actions. Clearly, Republicans were some of 

the first conservationists in the U.S. We had Teddy Roosevelt that 

created the national park system. President Nixon is actually the 

father of EPA. The first President Bush actually signed the Clean 

Air Act amendments. 

So we have worked together for years to find out how we can preserve and protect both public health and the natural resources, and 

continue to grow the economy. We are going to do exactly the same 

with the challenge of carbon pollution and climate change, and, indeed, the time is now to take action. And the best part of the action, sir, is that they will benefit the economy; they will spark 

American innovation; they will continue to keep us in a leadership 

position on clean energy. And I am very much looking forward to 

30 

having this discussion on our comment period of the proposal we 

released a few weeks ago. 

Mr. CUMMINGS. Now, all four of these Republican administrators 

endorsed the President’s Climate Action Plan. They said, ‘‘President Obama’s June Climate Action Plan lays out achievable actions 

that would deliver real progress.’’ Your proposed rule has also received praise from State governors. For example, Rhode Island 

Governor Lincoln Chafee said this, ‘‘Thank you to the President 

and the EPA for taking a step forward to reduce pollution from 

power plants, which nationally is a large source of carbon emissions.’’ 

Why is it that States, in particular, favor the approach you have 

taken in the proposed rule and what work have you done with 

States to ensure that their concerns are addressed? 

Ms. MCCARTHY. Well, as many of you may know, I actually 

worked for State government for a number of years under both Republican, actually, mostly Republican administrations. So when we 

started down this venture of trying to respond to the commitment 

that the President asked us to fulfill for the American public, 

which is to develop rules for existing power plants, we actually did 

unprecedented outreach. We spent considerable amount of time 

with the States and, as a result, we have a proposal that is as respectful of States as it possibly can. It has maximum flexibility and 

actually sets standards for those States that are practicable and affordable and achievable, but it allows them to create their own 

path forward so that it is done in a way that is most respectful of 

their own economies and their own energy needs, and where they 

are today and what they can do moving forward. 

So I am excited about moving forward with this. We are going 

to continue that spirit of outreach during this 120-day comment period and will continue to work with States, who are our greatest 

ally, in bringing these carbon pollution reductions to the table and 

ensuring that our communities stay safe and our public is protected. 

Mr. CUMMINGS. Chairman, just one more question. 

Another Republican former Bush Administration Treasury Secretary, Hank Paulson, wrote an op ed this week asserting that the 

climate crisis we now face rivals the global economic crisis of 2008. 

He said this: ‘‘This is a crisis we can’t afford to ignore. I feel as 

if I am watching as we fly in slow motion on a collision course toward a giant mountain. We can see the crash coming and yet we 

are sitting on our hands rather than altering our course.’’ He went 

on to say, ‘‘We need to act now. Even though there is much disagreement, including from members of my own Republican party, 

we must not lose sight of the profound economic risks of doing 

nothing.’’ 

So my last question, Ms. McCarthy, is his argument to this Republican colleagues is that the economic costs of inaction far outweigh the costs of acting now. Do you agree with that? 

Ms. MCCARTHY. I do, sir. And President Obama, I think, was 

very wise in developing this comprehensive plan and bringing together the entire Administration. He knew that climate change 

wasn’t just an environmental issue. It is a significant economic 

issue for this Country that we need to face, as well as a national 

31 

security challenge. And when this body is asked to figure out how 

to pay $110 billion in costs associated with national disasters in 

2012 alone that is not accommodated through the budget process, 

then we have a problem here that we need to address; and the 

great thing is we can do it in actions that are actually going to 

grow the economy and keep our communities safer. 

Mr. CUMMINGS. Thank you, Mr. Chairman. 

Chairman ISSA. Thank you. 

If you will put up the IG’s statement. 

Administrator, we received an email after this attempt, supposed 

attempt to accommodate the IG. In a nutshell, your IG is not satisfied that in fact the continued use of your Office of Homeland Security undermines the Office of Inspector General, statutorily responsible to both this body and to the President. Will you commit today 

to fully allow the IG to do their job and cease having this investigative process going on by your Office of Homeland Security? 

Ms. MCCARTHY. Mr. Chairman, I listened very closely to the 

hearing earlier that you had on this and I thank you for that. It 

became very clear that I needed to intervene personally on this 

issue and I have. Since you last met on this issue, we have made 

tremendous progress. We actually have staff in the OIG and OHS 

working together. The memo that he is talking about is our first 

step forward in this process—— 

Chairman ISSA. Ma’am, ma’am, the email from the inspector general says the progress has not been made. Homeland Security, this 

creation of your department—— 

Ms. MCCARTHY. Actually, I am not sure that is what that said, 

sir. We have made tremendous progress, but clearly we have not 

completely resolved all of our issues. 

Chairman ISSA. But nothing has changed to me means nothing 

has changed, and that is what it says. 

Here is the problem, administrator. You cannot, in my understanding, have failures, particularly human resource failures, abusive work environment, sexual harassment, fraud, you cannot have 

it investigated by your Homeland Security people who work for 

you. The IG exists to be independent. 

Now, if you choose to have some of your own investigations going 

on, I can’t take away your ability to do it. I can tell you that taking 

away the IG’s authority, or in any way having the IG not know 

about it, which has been testified before this committee that under 

your watch that happens and happens regularly, including the 

Beale situation, where, when you discovered that for years you had 

been duped, you had gone to lunch with Mr. Beale, he had been 

a pal of yours from all indications, this is somebody you regularly 

have optional meetings with. 

He fooled you. When you discovered, after his supposed retirement and non-retirement, that you and your agency had been 

fooled, and we are not holding you responsible for that kind of a 

failure; this man apparently was very good at his con work, he 

probably should have worked for the CIA instead of the EPA, but 

the fact is, when you discovered it, you did not immediately go to 

the IG; you went and did additional work. 

That policy flies in the face of the reason the IG Act was passed 

by Congress and signed by the President. 

32 

Ms. MCCARTHY. Mr. Chairman, I would do nothing to interfere 

with the ability of the OIG to do their jobs. The OIG actually requested that we take a look at defining roles and responsibilities 

between the OIG and OHS. And if you look at the memo that 

transferred this new process, where we were trying to work these 

issues diligently together as one EPA, it will verify that I have 

strongly supported this, and my process changes are exactly to ensure that the OIG can do its job while our national security issues 

are resolved. 

Chairman ISSA. Ma’am, this comment is related to the memo. So 

I guess we are going to ask the OIG to come back again, because 

he just doesn’t agree with you. 

Ms. MCCARTHY. Well, we haven’t had a chance to fully discuss 

it, Mr. Chairman. It was presented as a work in progress. It was 

presented to address some issues, and not all. I am very confident 

that if you give us the ability to work these issues, we clearly will. 

Chairman ISSA. Did the inspector general tell you, when you 

gave him the memo, that it was unacceptable? 

Ms. MCCARTHY. No. He told me it had not fully resolved his 

issues. I totally agreed with him and I understood that. 

Chairman ISSA. Okay, we will consider those to be synonymous. 

Let me go through a couple of things. Do you remember Mr. Martin Townsend? 

Ms. MCCARTHY. I do not know a Martin Townsend personally. I 

am familiar with his name, yes. 

Chairman ISSA. Okay. And you know who Susan StrassmanSundy was? 

Ms. MCCARTHY. I do not know that person personally, no. 

Chairman ISSA. Well, for many years Martin Townsend falsely 

signed and claimed that Susan Strassman-Sundy was in fact working when she was in a nursing home. She wasn’t working. Now, we 

can understand the sad situation that Susan Strassman-Sundy 

might be in, but what have you done to ensure that there is zero 

tolerance for falsifying and claiming—you say you have limited resources. These people were squandering your resources, and doing 

so as a practice that repeated itself. What have you done to make 

sure it never happens again? 

Ms. MCCARTHY. In general, sir, we have taken steps to make 

sure that our time and attendance is handled differently so it can 

be better monitored. We are also pursuing administrative action 

against Mr. Townsend and diligently pursuing that as well. We are 

trying to systematically make sure that our system is in place to 

catch these issues earlier and to work through these processes. I 

am very committed to making sure that waste, fraud, and abuse 

is pursued as diligently as we can, and I have in no way tolerated 

any lack of accountability or these types of issues. It is a disservice 

to the vast majority of people at my agency who work very 

hard—— 

Chairman ISSA. And you realize that the IG’s strongest point is, 

in fact, if you stay out of his way and let him do this, even if your 

Homeland Security people think that they should be doing the investigations. 

Obviously, we could deal with the people who are on administrative leave being paid full-time because of their addiction to pornogVerDate Aug 31 2005 13:15 Oct 06, 2014 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 C:\DOCS\89897.TXT APRIL
33 

raphy being too much for you to allow them to be on the job. I 

would hope that the EPA and other Government agencies would 

try to come to us with a request for authority to more quickly sever 

people who are so flagrantly flaunting good judgment and law. 

Ms. MCCARTHY. Anything that we can do to expedite these resolutions would be great. 

Chairman ISSA. Lastly, although I chastised you, and will continue to, for your failure to comply with the November subpoena, 

I want to thank you or thank your people on behalf of some cooperation we received on the Pebble Mine issue. It is clear, though, 

that as long as individuals who were part of the process that 

caused your agency to unilaterally attempt to preempt the application for a mine to comply with clean water, that we will find it unacceptable. 

We have tried to serve a subpoena on your former employee and 

we have asked for the failed hard drive from this Alaskan individual, who now is in New Zealand and seems to never be returning. We might strongly suggest that without the underlying science 

that you used to support your unprecedented, or nearly unprecedented, preemption of somebody’s ability to apply for a permit to 

your agency, that you reconsider and allow the application to go 

forward, since the underlying science now is not just in question, 

it is unavailable. If you would respond, and then we will go to 

the—— 

Ms. MCCARTHY. Just to make it clear, sir, I believe that our 

science assessment has been out in the public for quite some time; 

it was properly peer reviewed a couple of times. But I would also 

caution that the decision to move forward under 404(c) is not preempting that project from moving forward; it is creating a very 

public process to discuss this issue, and no decision has been made 

whatsoever as to whether or not EPA is going to utilize this authority under the Clean Water Act. 

Relative to the failed hard drive, I am happy to have our staff 

talk. I did not realize that that was being requested, but I am sure 

we can talk about that and work through these issues as we have 

on the other issues. 

Chairman ISSA. We have new appreciation for failed hard drives. 

I will say that since the people requested the 404 action before 

they did the science to support their conclusion, and which they did 

the request for 404 before, that, in fact, that prejudging that it was 

not going to be ever able to happen is a little bit like somebody 

holding their finger in the air and saying I understand there is a 

tornado coming. A tornado hasn’t come, but they are now asking 

us all to go to the shelters. The reality is that the documents indicate they made a decision and asked for the 404, and then did the 

science. 

Ms. MCCARTHY. I am sorry, sir, I don’t know who would have 

made that decision, but my understanding is—— 

Chairman ISSA. We will provide you the documents. 

Ms. MCCARTHY. My understanding is that the petitions came in, 

EPA chose to do the science assessment before they responded to 

the petitions, and then the decision was made to move together. 

Chairman ISSA. Ranking member. 

34 

Mr. CUMMINGS. Just a friendly follow-up. Probably one of the 

most important things to be answered here today the chairman 

asked, and I just want to make sure we get a clear answer on this. 

The Beale situation, what has been put in place to make sure—the 

chairman asked that but I didn’t hear the answer—to make sure 

that doesn’t happen again? Because I think every single member 

of this committee was very upset about it. I just want to know 

what now is in place to make sure somebody isn’t able to dupe an 

agency out of that kind of money for so long. 

Thank you, Mr. Chairman. 

Chairman ISSA. Sure. 

Ms. MCCARTHY. Thank you for asking. We have put in place a 

number of significant changes to the way we look at time and attendance, the way in which we approve travel. We actually now 

have a system that we switched to that is going to provide a hard 

stop for retention bonuses. We are requiring different levels of approval in requirements for approval of time and attendance. I am 

happy to provide a full documentation of all the steps we have 

taken to make sure that human error can’t happen and that managers don’t have an ability and a responsibility to hold their employees accountable. 

Chairman ISSA. Thank you. 

I am delighted to call on the gentleman from Missouri, who was 

here before the gavel, Mr. Clay. 

Mr. CLAY. Thank you, Mr. Chairman. 

Administrator McCarthy, I want to ask about the case of John 

Beale, a former senior policy advisor who worked for you when you 

were assistant administrator of EPA’s Office of Air and Radiation. 

As you know, this man lied to his friends, family, and EPA colleagues for 13 years by claiming that he worked for the CIA in 

order to avoid doing work for the EPA and to steal time from the 

Government. 

Mr. Beale got away with this for years under both Republican 

and Democratic administrations until you started the process of investigating his supposed CIA assignment. This man is now sitting 

in a Federal prison serving 32 months and has been required to 

pay nearly $1.4 million in restitution and forfeiture. Mr. Beale 

claimed that he was able to deceive colleagues at the EPA because 

he earned their trust and respect over the years, and they did not 

think to question him. 

Ms. McCarthy, when you first joined the EPA, did senior officials 

tell you that Mr. Beale worked for the CIA? 

Ms. MCCARTHY. I was led to believe that he did, yes. 

Mr. CLAY. And during your tenure as assistant administrator of 

Air and Radiation, were you unhappy with the fact that Mr. Beale 

was spending so much time supposedly working for the CIA? 

Ms. MCCARTHY. I was, sir. I did my best to get him back to EPA 

so we could utilize our Federal funds as appropriately as we could, 

recognizing at that point that I thought he had obligations to another agency as well. 

Mr. CLAY. During this committee’s deposition of Mr. Beale in December 2013, Mr. Beale stated that you halted his work on a 

project he started in 2005 under one previous assistant administrator and supported by two more after that. Mr. Beale stated durVerDate Aug 31 2005 13:15 Oct 06, 2014 Jkt 000000 PO 00000 Frm 00038 Fmt 6633 Sfmt 6633 C:\DOCS\89897.TXT APRIL
35 

ing his deposition that you asked him to stop working on that 

project, come back to working full-time, and resume his position at 

the Office of Air and Radiation. Is that true? 

Ms. MCCARTHY. My main goal was to get him back to EPA for 

as many hours as I possibly could, and I think his deposition might 

indicate that I was a bit of a pest about that. But I am glad I was; 

it led to a referral to the OIG and they did a great job with DOJ 

in putting him in jail and getting back Federal funds that belonged 

to the public. 

Mr. CLAY. And just for the committee’s sake, Beale said that you 

told him things were so busy that we just cannot afford having 

somebody out there doing an academic project, and we need all 

hands on deck. Is that accurate? 

Ms. MCCARTHY. That is correct. 

Mr. CLAY. Administrator McCarthy, the plea agreement that Mr. 

Beale signed with the U.S. Attorney’s Office only covered his fraudulent actions from 2000 to 2013. I believe there must be unauthorized bonuses and travel expenses that the Federal Government and 

American taxpayers paid which Mr. Beale has not given back. Do 

you agree? 

Ms. MCCARTHY. Yes, I do. 

Mr. CLAY. And is EPA making efforts to collect these additional 

monies from Mr. Beale? 

Ms. MCCARTHY. EPA is continuing to seek additional reimbursement and restitution, as well as taking steps to reduce his retirement annuity. We are attempting to get back everything that this 

convicted felon fraudulently took from the United States of America. 

Mr. CLAY. And he is still eligible for his retirement? 

Ms. MCCARTHY. Well, he is. As far as I know, that is what the 

law indicates. Even if we had successfully fired him, he would still 

be eligible for retirement. 

Mr. CLAY. I wonder if he gets one from the CIA. 

Ms. MCCARTHY. I am not sure he is spending it in the place 

where he would choose, but he has it. 

Mr. CLAY. You know, during this committee’s interview in March 

with Mr. Hooks, the assistant administrator for the Office of Administration Resources Management, he told us that you sought 

his assistance with Mr. Beale in December of 2010 or January of 

2011. I understand that personnel issues are within Mr. Hooks’s 

portfolio, is that correct? 

Ms. MCCARTHY. I did, yes. 

Mr. CLAY. And he stated that you were frustrated that EPA was 

paying for Mr. Beale’s salary when he was supposedly working 100 

percent for the CIA. He said you wanted Mr. Beale back doing 

work for you. He also said you were concerned that his retention 

bonuses were not recertified and he was being paid over the statutory limit. Is that correct? 

Ms. MCCARTHY. That is correct. 

Mr. CLAY. Mr. Chairman, I see my time has expired, and I yield 

back. 

Mr. CHAFFETZ. [Presiding.] I thank the gentleman. 

I will now recognize myself for five minutes. 

36 

Thank you for being here. Madam Administrator, you say that 

you are cooperating with the Office of Inspector General, yet in 

July of 2013 they highlighted to Congress that you had not issued 

an all-hands memorandum to your employees encouraging them to 

participate. Why not do that? 

Ms. MCCARTHY. I actually was a bit appalled to think that I had 

to send out a memo on one particular legal obligation of my expectations to staff, and I knew that there were a lot of challenges they 

were facing in terms of updating our systems. 

Mr. CHAFFETZ. Are you doing to do that? Are you going to issue 

an all-hands memorandum to your employees? 

Ms. MCCARTHY. I am sorry, I will answer more quickly. I actually, instead of doing a memo, I did an all-hands video and speech 

where we talked about both accountability where I confirmed my 

expectation that people would be accountable and that the OIG was 

important and should be fully brought in to any issues of waste, 

fraud, and abuse. 

Mr. CHAFFETZ. I think to satisfy the OIG’s concerns, to issue a 

memorandum to make it clear to employees to help participate 

would be much appreciated. 

I ask unanimous consent to enter into the record the June 13th, 

2014 letter from Chairman Issa and Senator Vitter to this effect. 

Ms. MCCARTHY. Sir, can I just point out that I send a lot of mass 

mailers out? I do very full town hall meetings—— 

Mr. CHAFFETZ. Without objection, so ordered. 

Ms. MCCARTHY.—and that is what I did this town hall meeting 

to actually impress upon it. 

Mr. CHAFFETZ. It obviously didn’t satisfy their concerns. 

Let me ask you. Prior to your being named the administrator, 

you were, my understanding is, the assistant administrator of the 

Office of Air and Radiation from 2009 to 2013, correct? 

Ms. MCCARTHY. Yes. 

Mr. CHAFFETZ. And during that time it is my understanding that 

you had three people that were direct reports to you, correct? 

Ms. MCCARTHY. I actually had quite a few more than that, sir. 

Mr. CHAFFETZ. How many direct reports to you? 

Ms. MCCARTHY. Let me look. I had probably 10 or so. Actually, 

11, 12, something like that. 

Mr. CHAFFETZ. A dozen or slightly less than. Is it against department policy to view pornography on official work computers during 

official time? 

Ms. MCCARTHY. Yes. 

Mr. CHAFFETZ. What is the consequence if you get caught doing 

that? 

Ms. MCCARTHY. You either take criminal or administrative action, or both. 

Mr. CHAFFETZ. Can you be fired? 

Ms. MCCARTHY. Yes, you can. 

Mr. CHAFFETZ. We have three instances here. For instance, we 

have a GS–14 EPA employee within the Office of Air and Radiation, something that you oversaw, who had been accused of viewing pornography two to six hours a day since 2010. This person is 

on administrative leave with pay. Why didn’t you fire this person? 

37 

Ms. MCCARTHY. I actually have to work through the administrative process, as you know, and there is still an ongoing OIG criminal investigation, is my understanding. We have actually banned 

him from the building. He no longer has access to any EPA equipment. But administrative leave—— 

Mr. CHAFFETZ. We have another person at the EPA within the 

Office of Policy who admitted, they have admitted, viewing pornography while at work for at least two hours at a time. You have another person, an EPA employee at the Chicago Regional Office, who 

had child pornography files on his work computer and viewed them 

on a regular basis. 

Ms. MCCARTHY. Actually, that gentleman was fired and was actually put in prison. 

Mr. CHAFFETZ. I just don’t understand why—at one point the 

OIG walks into the office, they are actually viewing pornography 

when they walk into the office, and that person has not been fired. 

I don’t understand. 

Ms. MCCARTHY. Well, we just had an exchange with the chairman that I would like to point out, which is any way that we can 

make these processes move more quickly, I am all for it. But there 

is an administrative process we must follow, because it is one thing 

to get upset; it is a second thing to successfully go through both 

criminal and administrative procedures to address the issue—— 

Mr. CHAFFETZ. And I think that is something we are going to 

have to address, because why these people aren’t fired on the spot 

I just do not know. 

Ms. MCCARTHY. I would welcome Congress taking up some of 

those challenges; it would be great. 

Mr. CHAFFETZ. And I also, with all due respect, need to understand why you had issued a memo. This is an email that you sent 

on March 29th of 2012. This gets into knowing when John Beale 

was a problem. I mean, at one point you say, ‘‘I thought he had 

already retired,’’ and yet he continued on the payroll for some time. 

You knew about his issues with his payroll problems and his other 

things for years, and you didn’t do anything about it. 

In fact, your own agency department here issued this report saying from the beginning of 2001 it appears Mr. Beale began not to 

appear in the office as much as one day per week, although he was 

not approved to leave. Second, beginning in the mid-2000s, Mr. 

Beale began not to appear in the office for more lengthy periods of 

time. According to the EPA’s Office of Inspector General, those 

abuses ranged from weeks to several months in the mid-2000s to 

the end of Mr. Beale’s career. He didn’t even appear at work. He 

is one of your less than 12 employees. Why wasn’t he fired at that 

point? If he doesn’t show up to work for months, did you not know 

that? 

Ms. MCCARTHY. I think that we have discussed the fact that it 

was my understanding from day one that he had obligations to 

other agencies as well. I did the best that I could to try to keep 

track of him and to bring him to justice and, frankly, I am very 

appreciative of the work of the OIG and DOJ to actually—— 

Mr. CHAFFETZ. Why did it take you so long? The OIG said it took 

him one week to figure it out. You knew it was a problem for years 

38 

and you didn’t think to call or ask anybody? Why is it that the OIG 

could find it out in one week? 

Ms. MCCARTHY. Actually, I did refer it to the OIG when I had 

the information available to me that I had been requesting for 

quite some time and working diligently to—— 

Mr. CHAFFETZ. You referred it to the general counsel; you did not 

refer it to the OIG, which you were supposed to do. And you got 

promoted because of all this. 

Ms. MCCARTHY. I am sorry, sir, that is not correct. That is not 

correct. I actually referred it as a human resources issue to OARM, 

which is our office that handles that. It became clear that there 

were other issues involved. They referred it to OHS to do some 

communication through the intelligence agencies because they are 

our liaison. When information was understood that this was more 

than a time and attendance issue, then it was referred to the OIG 

appropriately. This was a time and attendance issue and other 

things. 

Mr. CHAFFETZ. We will spend some more time on this issue. My 

time is well passed and expired. 

I believe we now go to Mr. Tierney now, from Massachusetts, for 

five minutes. 

Mr. TIERNEY. Thank you, Mr. Chairman. 

I think perhaps you wanted to go somebody else? I am fine with 

that. 

[Pause.] 

Mr. TIERNEY. Ms. McCarthy, how are you? 

Ms. MCCARTHY. I like the way you say my name, sir. 

Mr. CONNOLLY. Hey, I can do it too. 

[Laughter.] 

Mr. TIERNEY. So, look, thanks for throwing out the first pitch to 

the Red Sox this year. We have some more work to go on that, 

but—— 

Ms. MCCARTHY. I did better than Fitty Cent. 

Mr. TIERNEY. You did. You did. 

[Laughter.] 

Ms. MCCARTHY. You like the way I said that? 

Mr. TIERNEY. I like the way you said that as well. 

I want to shift gears a little bit here because I think there are 

some important things being done that we have to talk about here. 

One is the clean power plan that EPA put out. It really has the 

potential to drive technological innovation and the clean energy 

and energy efficient technologies. I think that is critical on that 

and I am sure you will agree. It is going to be a huge benefit to 

our economy, especially in the long-term, but also in the more recent term. 

So one of the elements of that proposal is the option for States 

to use electricity more efficiently. You base and the Agency based 

its proposal on what States are already doing to implement energy 

efficiency measures. I want to ask you to tell us a little bit more 

about the best performing measures that States are already using 

to improve energy efficiency and reduce electricity demand. 

Ms. MCCARTHY. Well, what is most exciting about this is the fact 

that States and cities—I was just at the U.S. Conference of Mayors, 

and they know they have been dealing with these for a while and 

39 

they have developed a bunch of different techniques that can address carbon pollution and put money in people’s pocketbooks. So 

they are pretty excited, as am I. 

There are energy efficiency initiatives that can be brought to the 

table. I think you will know from Massachusetts they have a robust 

energy efficiency program. They also have a renewable fuel standard program. They have been a leader in energy efficiency, I am 

proud to say, for years, and they also are participating in the regional greenhouse gas initiative, because the other flexibility that 

we allowed in this proposal to States is not just go it alone, but if 

you want to join with other States or work on regional initiatives 

so that you get better reductions for your money, that is wide open 

to you. 

So I think this will indeed spark innovation in renewables and 

energy efficiency technologies. It will be a leader in 21st century 

energy generation and I am pretty pumped. 

Mr. TIERNEY. And are you working to make sure that other 

States have the advantage of knowing what the best practices are 

in those States that are really aggressive in those areas? 

Ms. MCCARTHY. We are. Actually, if you take a look at this proposal, we give examples of State leadership here that others can 

work from. We also are meeting with States and energy officials 

and environmental officials from those States so that everybody 

gets to see what the best practices are that they can take advantage of, especially the efficiency ones, which pay off for everybody 

consistently. It is just a way of getting pollution reduction that is 

sustainable, and that is what we are really looking for here because you can continue to grow the economy while you cut those 

pollution levels down. That is what EPA does. 

Mr. TIERNEY. Look, in my district I know people are talking 

about jobs, and I suspect it is not different elsewhere on that. So 

talk to us a little bit about the number of jobs that could be created 

by making these kind of investments on that and just how we are 

going to boost the economy that way. 

Ms. MCCARTHY. Well, we know that this will actually create 

thousands of jobs, and those jobs are going to be created in the 

clean energy economy. We are talking about jobs related to both renewable energy, as well as a wealth of energy efficiency programs. 

If you are heavily reliant on coal, it also can be expenditures that 

you make at those facilities to deliver that energy more efficiently. 

So there is a lot of choices that States get to make here. We wanted 

to take each State where they were so that this wasn’t an attempt 

to preclude any generation from being utilized effectively. But it is 

to open up the table to all kinds of new choices to States that 

would continue to grow jobs. 

Mr. TIERNEY. Did you find any parts of the Country that didn’t 

have a potential to boost their use of clean energy? 

Ms. MCCARTHY. Well, one of the reasons we did individual State 

standards and then allowed the States to develop their own plans 

as a proposal was because we recognized that each State was in a 

different place. So some have looked at that kind of funny. If you 

look at percentages, you will see that West Virginia, which emits 

a considerable amount of carbon from their coal-based system, they 

40 

have a little bit less percentage reduction because their opportunities aren’t as great for inexpensive reductions. 

Where you have the State of Washington that does very well, we 

are asking a large percentage. We just looked at what they were 

doing anyways, where they were. This is not a stretch goal for any 

State; it is an opportunity to turn climate risk into business opportunity, job growth, and economic growth. 

Mr. TIERNEY. It seems pretty clear that you are giving incentive 

to States to put in more solar panels, to erect more wind turbines, 

weatherize more homes, install more energy-efficient appliances 

and machinery. I mean, this is the direction that we are heading. 

These are jobs that pay well. They can’t be exported. They are here 

to stay, is that right? 

Ms. MCCARTHY. That is exactly right. 

Mr. TIERNEY. So I just think that you are heading in the right 

direction I think not only for the clean air aspect of it and all the 

other economic and even national security issues we are talking 

about, but the jobs, jobs, jobs part of it on that and the allowance 

of States with the flexibility to innovate and do it in the way that 

makes more sense to them. I thank you and the Agency for your 

hard work in that regard and I yield back my time. 

Ms. MCCARTHY. Thank you, sir. 

Mr. MEADOWS. [Presiding.] I thank the gentleman from Massachusetts. The chair recognizes the gentleman from North Carolina, 

Mr. McHenry. 

Mr. MCHENRY. I thank the gentleman from North Carolina. 

Administrator McCarthy, I thank you for being here today and 

I certainly appreciate your willingness to answer questions. I want 

to ask you about a Superfund site in my district, in Buncombe 

County, Region 4. And there is TCE contamination, and TCE is 

often called sinker, right? And what we found with studies, and 

what I have been told from the experts, is that this TCE contamination is also a floater, because there is a petroleum element to it, 

so it is on the surface of the groundwater. So, therefore, finding 

that out is a positive thing because it makes the cleanup easier and 

means that we can actually take action now. So that is what I 

want to ask you about, is about that very issue. 

The EPA can require CTS, which is the company that did the 

polluting, to move forward immediately to address the floating contamination while it continues to investigate the sinker contamination. Will the EPA urge CTS and direct them to do that? 

Ms. MCCARTHY. Well, I don’t know, sir, what the next step is. I 

do know that progress is being made, and I really appreciate your 

interest in this site. This is actually a site that can significantly 

impact public health. So I think it is important that we keep moving this forward. I am glad it has been listed on the Superfund list, 

finally, so that we can move it forward, and our next steps are actually to conduct some follow-up air sampling studies to define the 

extent of the contamination in the air and in nearby homes, which 

is something that I think you have been very focused on. And the 

study will expand and move away from the site so we can identify 

the full extent of the release of the volatile organic compounds and 

we can properly address both the immediate public health challenge, as well as the environmental cleanup challenges. 

41 

Mr. MCHENRY. So this has been 20 years in the making, long before you and I had our current roles and long before Congressman 

Meadows and I represented this county. We have only represented 

this county for 18 months. But what we need is action from you. 

And from what we understand from CTS officials, and my constituents have heard from board members of that company, they said 

they have asked and the quote is they are doing everything that 

EPA has asked them to do. Right? So there is a credibility problem 

for the EPA at stake here, both on the time frame it took to get 

this site on the national priorities list, as well as that type of message coming from the company. 

We also know that administrative orders of consent in 2004 and 

2012 say that the EPA has the authority to direct the company in 

very extraordinary ways. So I ask you to do that. There is immediate action that can take place that would be good for the public 

health of my constituents and Congressman Meadows’ constituents, 

good for western North Carolina, and is a meaningful step that can 

be taken in the short-term to clean up what we know is achievable, 

even though the more difficult issue may still remain. 

So what I ask you to do, what I urge you to do is to work through 

these issues and deal with that and take action. 

Ms. MCCARTHY. I would be happy to take a look at this. Why 

don’t I make sure that your staff and ours talk about this? And I 

will do the very best I can to make sure that this cleanup addresses both the immediate concerns, as well as the long-term pollution 

issues that we are trying to address. 

Mr. MCHENRY. Thank you. I thank you. We have worked extensively with Region 4 staff. Look, we all want clean water. We all 

want clean air. And what my families that I represent in western 

North Carolina want is action taken. 

So, with that, I would like to yield the balance of my time to 

Congressman Meadows on this issue, because he has worked extensively on this matter as well. 

Mr. MEADOWS. I thank the gentleman. I thank the gentleman 

from North Carolina. Congressman Mica would like me to yield 

just a couple minutes. 

Mr. MICA. Well, thank you. I will be very brief. I came late and 

I am leaving early. 

I would just like if you could provide to the committee, since it 

is such an important issue, any changes in the definition of wetland. I know by regulation you are changing the rules. It is going 

to have a huge impact. I have not been happy with any changes 

from either this committee or the Transportation Committee. If you 

could provide that timeline to the chair and the committee, I would 

appreciate it. 

I yield back. 

Mr. MCHENRY. Reclaiming my time. I ask unanimous consent 

that Congressman Meadows be yielded 50 seconds, since that subject matter didn’t have anything to do with the water pollution 

issue we have in our district. 

Mr. MEADOWS. Without objection. 

Ms. McCarthy, I have worked extensively with Congressman 

McHenry and your office in Region 4. The frustration that I have 

experienced, if I was to be as passionate as the people that I repVerDate Aug 31 2005 13:15 Oct 06, 2014 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 C:\DOCS\89897.TXT APRIL
42 

resent this morning, it wouldn’t be something that C–Span could 

cover. Truly, the inaction of the EPA to protect the health and wellbeing of the citizens of Buncombe County at best has been thwarted and at worst has been ignored, and it is incumbent upon the 

EPA, if the mission is the health and well-being of the citizens, 

that we get an action plan that not only talks about the short-term, 

but that cleans it up. This is a 25-year problem that still exists 

today and cleanup hasn’t started. 

So, with that, I would recognize Mr. Connolly, the gentleman 

from Virginia. 

Mr. CONNOLLY. I thank my friend from North Carolina. 

You know, Ms. McCarthy, I thought I heard you say earlier to 

the chairman that the subpoena in question subpoenaed all communications regarding congressional inquiries between the White 

House and the EPA for a five-year period? 

Ms. MCCARTHY. That is correct. 

Mr. CONNOLLY. And I think you said that was a pretty wide net. 

Ms. MCCARTHY. It is a pretty broad search. 

Mr. CONNOLLY. Generally, when nets are that wide, what is 

going on is called a fishing expedition. Do I also understand that 

what is at dispute and why you were threatened with contempt at 

the beginning of this hearing, which, by the way, makes for an awfully nice headline, and I am sure the press at the press table will 

be once again accommodating and provide such a headline and, of 

course, substance with respect to EPA will be set aside or lost in 

the noise. It is kind of a pattern around here; get a witness, pillory 

the witness, interrupt the witness, threaten the witness, tell the 

witness she or he is not cooperating, interrupt the witness when 

the witness actually starts to have a relevant answer to a question, 

and focus often on the extraneous to make sure, however important 

that extraneous might be in its own right, but to make sure that 

we are not actually talking about something of substance like global warming. In fact, a warning at the beginning of this hearing 

that it is not about global warming, after one of the most momentous regulatory decisions in the history of the EPA and after a very 

interesting Supreme Court ruling which I want to talk to you about 

this week. 

So I am sorry you are getting the treatment; it is par for the 

course. We have done it, unfortunately, with a lot of consistency for 

the last four years. It is not pretty. My friend, Jackie Speier, read 

into the record yesterday even the speaker, Speaker Boehner, 

warning that witnesses coming before committees here in Congress 

need to be treated with respect. I find it really interesting, by the 

way, that we would also, some of us, apparently, would focus on 

people who have obviously abused or misused their position at the 

EPA by watching pornography or engaging in other things that are 

illegal or certainly inappropriate. 

It was just announced yesterday that a chief of staff to a member 

of Congress, Republican member, had to resign after it was revealed he had had a long-term affair with a porn star and had inappropriate pictures of his physique posted. And we have members 

of Congress who have been in the books of madames of brothels. 

We have had members of Congress selling or buying cocaine. We 

have our own peccadillos and we can focus on those too, and maybe 

43 

we need a special prosecutor or maybe we need to be investigated 

as to how long did we know and whether Government property was 

used, and whether, when somebody learned of it, they appropriately responded in a relevant period of time. 

I say Congress itself is hardly clean here. And that doesn’t mean 

we want to, in any way, shape or form, condone inappropriate activity, but to somehow pretend in our questioning that it is unique 

to you and to the EPA is really a bit much. 

If I may ask, in the time limited, about Justice Scalia’s opinion 

this last week. Is it fair to say that the endangerment finding is 

now settled law after that ruling? 

Ms. MCCARTHY. I don’t want to speak as a lawyer, sir, but it 

seems pretty settled to me, yes. 

Mr. CONNOLLY. The court did nothing to roll back the landmark 

decision in 2007 that EPA has the authority to regulate greenhouse 

gas emissions. Would we maybe agree that EPA’s authority to regulate greenhouse gas emissions is now settled law based on that 

opinion? 

Ms. MCCARTHY. It certainly appears that way to me, sir. 

Mr. CONNOLLY. The court was looking specifically at EPA’s program for regulating carbon pollution for large new industrial facilities. The court took issue with the EPA’s legal approach but basically came very near to the same result in terms of which facilities 

could be regulated. Is that your understanding? 

Ms. MCCARTHY. It basically confirmed what we are already 

doing, yes. 

Mr. CONNOLLY. Justice Scalia reportedly said, in announcing the 

opinion, it bears mention that EPA is getting almost everything it 

wanted in the case; it sought to regulate sources that it said were 

responsible for 86 percent of all greenhouse gases emitted from stationary sources. Under our holdings, EPA will be able to regulate 

sources responsible for 83 percent. Do you believe the Supreme 

Court’s decision validates your efforts to responsibly regulate carbon emissions from large new facilities? 

Ms. MCCARTHY. Oh, very much so. 

Mr. CONNOLLY. Does anything in the court’s decision last week, 

or this week, really, impact your authority to cut carbon emissions 

from existing power plants? 

Ms. MCCARTHY. No, sir. It is a confirmation that EPA has been 

on the right track and that the Clean Air Act is an appropriate tool 

and that we can use it wisely and effectively. 

Mr. CONNOLLY. And how many members of the Supreme Court 

joined Justice Scalia’s opinion in that ruling? 

Ms. MCCARTHY. Seven to two, sir. 

Mr. CONNOLLY. Seven to two. So a decisive opinion by the Supreme Court validating your role and the regulation just issued. 

I thank the chair and I thank you, Ms. McCarthy, for your service to your Country. By the way, where in Boston do you come 

from? 

Ms. MCCARTHY. I actually live in Jamaica Plain. 

Mr. CONNOLLY. Jamaica Plain. 

Ms. MCCARTHY. Yes. I was born and brought up in Kenton. 

44 

Mr. CONNOLLY. All right. My family is in West Roxbury, and I 

can talk like that too. And I love the Red Sox; they are working 

good and I am hoping they win. 

Mr. MEADOWS. I thank the gentleman from Virginia. 

[Laughter.] 

Mr. MEADOWS. Needing no translator, we will go to the gentleman from Ohio. 

Mr. JORDAN. I thank the chairman. 

Ms. McCarthy, I understand your agency is not the agency that 

ultimately decides, although you are pretty heavily involved. When 

do you think the American people can expect a decision on the Keystone pipeline? 

Ms. MCCARTHY. My understanding is that there are certain 

issues with the location of the pipeline that needs to be resolved, 

so I cannot anticipate that. 

Mr. JORDAN. Do you know when the application for the Keystone 

pipeline was first submitted? 

Ms. MCCARTHY. No, I do not. 

Mr. JORDAN. September 2008. Almost six years ago. You are familiar with the fact that the governor of Nebraska said he is fine 

with the new proposed route? 

Ms. MCCARTHY. It is not my decision, sir. 

Mr. JORDAN. But don’t you have a critical part in the ultimate 

decision? Didn’t you guys do an environmental impact report from 

your agency which said there are no significant impacts to have 

this pipeline come through the United States? 

Ms. MCCARTHY. Actually, EPA’s role is to comment on that impact reported. It actually was developed by the Department of 

State. 

Mr. JORDAN. And you guys gave it a thumbs up, isn’t that correct? 

Ms. MCCARTHY. EPA has just provided comments. We have no 

authority to do up or down on this one. 

Mr. JORDAN. And your comments were clear back in 2011. It is 

my understanding August 2011 is when you gave the comments 

that there are no significant impact, no significant environmental 

impact. 

Ms. MCCARTHY. It is not clear to me that that was a comment 

from EPA. 

Mr. JORDAN. Have you had any conversations with the State Department since that August 26, 2011 report, where you said no significant environmental impacts? Have you had conversation with 

the State Department about the Keystone pipeline? Do you know 

if your agency has? 

Ms. MCCARTHY. I personally have not. We have staff that—— 

Mr. JORDAN. In your time at the agency, have you had conversations with the State Department about the Keystone pipeline? 

Ms. MCCARTHY. I may have. 

Mr. JORDAN. Have you had conversations with the White House 

about the Keystone pipeline? 

Ms. MCCARTHY. Yes. 

Mr. JORDAN. How recently? 

Ms. MCCARTHY. Oh, we received information on the Keystone 

pipeline when the pipeline issue and the route question arose, and 

45 

they actually sent a memo to us indicating that we should hold off 

on submitting our comments. I think that was probably four 

months ago or so. 

Mr. JORDAN. So in the past four months. Since that time have 

you had any conversation with the White House and/or the State 

Department regarding the Keystone pipeline? 

Ms. MCCARTHY. Not that I can recall. 

Mr. JORDAN. No conversation in the last four months with either 

the White House or the State Department? 

Ms. MCCARTHY. Not that I can recall. 

Mr. JORDAN. How long do you think is appropriate for a decision 

to take? Is six years too long, too short? Can you hazard a guess 

at what point the Administration is going to say, okay, six years 

is long enough, we have to make a decision? How long do you think 

is an appropriate time frame? 

Ms. MCCARTHY. There is no timeline, sir. 

Mr. JORDAN. There is no timeline? 

Ms. MCCARTHY. Not that I am aware of. 

Mr. JORDAN. Do you think it is okay if it took eight years? 

Ms. MCCARTHY. It is not a project that I am proposing. 

Mr. JORDAN. I am asking your opinion, though. The whole issue 

has been the environmental concerns. You head the Environmental 

Protection Agency. I am saying is eight years okay to wait after an 

application has been submitted? 

Ms. MCCARTHY. There is no timeline, sir. 

Mr. JORDAN. Ten years would be okay? 

Ms. MCCARTHY. There is no timeline. 

Mr. JORDAN. So forever. It could take 20, 30 years, and that 

would be fine. 

Ms. MCCARTHY. It is a project that goes through its own work 

to get the project developed. It goes through an impact statement 

development, EPA comments. We have nothing more to do with it 

other than a commenter on somebody else’s project that is being 

evaluated by another agency. 

Mr. JORDAN. And you said there is no significant environmental 

impact, and what I am trying to get at is—— 

Ms. MCCARTHY. I do not believe that was actually what we said. 

We raised issues relative to the analysis that we thought could be 

improved. I think work has been done since then, but we have not 

seen—— 

Mr. JORDAN. One last thing. Just for the record, so in the last 

four months you have had no conversations, there has been no 

input from the EPA to the White House and/or the State Department regarding the approval or some kind of decision made on the 

Keystone pipeline application. 

Ms. MCCARTHY. I think you asked me about my own personal 

communication since we received the memo that we should hold 

off. 

Mr. JORDAN. Right. 

Ms. MCCARTHY. I have not had personal conversations about 

this. 

Mr. JORDAN. Well, then let’s ask. Has your agency had any conversations with the White House? To your knowledge, has your 

46 

agency had any conversation with the White House or the State 

Department in the last four months? 

Ms. MCCARTHY. I do not know the answer to that question, sir. 

Mr. JORDAN. Okay. 

Mr. Chairman, I yield back. 

Mr. MCHENRY. I thank the gentleman from Ohio and we go to 

the gentlewoman from California, Ms. Speier. 

Ms. SPEIER. Mr. Chairman, thank you. 

And thank you, Administrator McCarthy, for being here. I would 

like to, at the outset, point out that this committee has made 18 

separate committee investigations of the EPA; that in making requests of the EPA, your office has provided 208,000 documents; 

that you have testified three times; and that you have sat for a 

transcribed hearing. So I believe all of that suggests that you are 

a very compliant witness, that you have been very accommodating 

to this committee, and that for members to throw around the 

threat of contempt, when there has been this much attention paid 

by you and your agency to this committee, is without merit. 

Now, your clean power plan has gotten some rave reviews recently, none the least of which is from The Wall Street Journal, 

which says it strikes a balance between environmentalists and utilities in terms of what they all want. Nike and Levi and Starbucks 

have all commented on how they saw it as valuable. 

In California, unlike some of my colleagues on the other side of 

the aisle that suggest that curbing carbon dioxide emissions kills 

jobs, California, as you know, has a cap and trade environment in 

which we are operating, and in the last couple of years we boasted 

some of the greatest economic turnarounds ever. As long as cap 

and trade has been in effect, California now ranks in the top 10 

States in employment growth and 4 of the top 20 U.S. regions for 

job growth. So I think in California we believe that you can have 

a healthy economy and a healthy environment, as well. 

So my question to you, with the understanding that the Government Accountability Office considers climate change to be high risk 

to taxpayers, it appears we have just an outstanding responsibility 

to address it. Would you tell us what you believe the relative costs 

and benefits of the EPA’s proposed rule on existing power plants 

is? 

Ms. MCCARTHY. I am happy to do that. And I think I will just 

point out that the President indicates that this is a moral obligation to act, and I couldn’t agree with him more. 

Ms. SPEIER. So does the Pope. 

Ms. MCCARTHY. The power plant rule that we put out, the proposal, looks at a $55 billion to $93 billion a year in benefits in 2030 

alone, which far outweighs the costs that are estimated at $7.3 billion to $8.8 billion. This is clearly a winning opportunity, not just 

in terms of a cost benefit analysis for today, but in terms of the 

future it will provide for our children. And this is all about public 

health. It is all about protecting our children and keeping our communities safe today. 

Ms. SPEIER. In fact, your reference to public health is worth restating. I am told that anywhere between 2700 people to 6600, on 

the high end, are not going to be subject to dying prematurely beVerDate Aug 31 2005 13:15 Oct 06, 2014 Jkt 000000 PO 00000 Frm 00050 Fmt 6633 Sfmt 6633 C:\DOCS\89897.TXT APRIL
47 

cause of this plan, and that between 140,000 and 150,000 children 

will not have asthma attacks as a result. 

Let me shift gears for a minute. In an interchange with one of 

my colleagues, who somehow objected to the fact that you didn’t go 

immediately to the inspector general on the Beale case, you indicated that you went first to the Office of General Counsel. Can you 

explain to us why you did that? 

Ms. MCCARTHY. Well, originally my understanding and my goal 

was to make sure that he was appropriately utilizing his time, 

whether it was with us or with another agency. When I had concerns about him not being at EPA, as well as concerns about 

whether or not he was effectively working for another agency, I 

brought it to the—— 

Ms. SPEIER. Can we say what the other agency is? I think it 

is—— 

Ms. MCCARTHY. I believe it is the Central Intelligence Agency. 

Ms. SPEIER. All right. So that is why there was some mystery. 

Ms. MCCARTHY. But at that point in time I did not know that 

that arrangement wasn’t real. I knew I had a problem. I went to 

the correct agency. That agency themselves brought in our Office 

of General Counsel and they also made a decision to go to our Office of Homeland Security because, programmatically, it is our liaison with the intelligence community. And the first question was 

did he have a relationship and an obligation to another entity, and 

when that progressed far enough for us to know that we had bigger 

problems than we originally anticipated, I brought to the issue to 

the inspector general and asked them to do a thorough investigation. 

And I have to say as much as there are questions about whether 

we support the OIG, is that clearly I do; the agency does. There 

is a culture of embracing the Office of the Inspector General, knowing that EPA needs to be high-performing. Anything less wouldn’t 

do service to the public and to protecting public health and the environment, which is clearly our mission, as well as our passion. 

Ms. SPEIER. Thank you for your leadership. 

I yield back. 

Mr. MCHENRY. I thank the gentlewoman from California. 

The chair recognizes the gentleman from Michigan, Mr. Walberg. 

Mr. WALBERG. Thank you, Mr. Chair. 

Ms. McCarthy, in EPA’s recent proposed rule to reduce greenhouse gas emissions, each State has a different target for emission 

reductions. That is right? 

Ms. MCCARTHY. That is correct. 

Mr. WALBERG. The target was determined by analyzing four criteria, as I understand it, one of which was demand-side energy efficiency programs. What does demand-side energy efficient program 

mean? 

Ms. MCCARTHY. Well, basically it means looking at opportunities 

for consumers to retrofit their homes, to buy more energy-efficient 

appliances. It is everything you can do to reduce energy demand, 

which reduces draw on fossil fuel energy, which in turn reduces 

carbon pollution. 

48 

Mr. WALBERG. But my follow-up would be EPA does not, does not 

have authority to directly regulate demand-side efficiency programs, does it? 

Ms. MCCARTHY. Well, actually, we are not doing that with this 

rule, sir. We are actually regulating the pollution from the fossil 

fuel—— 

Mr. WALBERG. It doesn’t appear that way. The fact is in establishing those subjective criteria for each State, you are attempting 

to regulate demand-side. I mean, the facts are the facts. 

Ms. MCCARTHY. I can understand where you would look at it 

that way, and actually we have specifically called out this issue in 

the rule itself. We are doing here what States actually asked us to 

do, was to allow them maximum flexibility to design their own 

plans on the basis of what they could do to reduce carbon pollution 

at the source, which is what we are regulating. 

Mr. WALBERG. But directly pushing demand-side. 

Ms. MCCARTHY. No. 

Mr. WALBERG. Let me go on. EPA has said the rule not increase 

the cost of electricity, but under this proposed rule the cost of electricity per kilowatt hour will actually increase. Isn’t that correct? 

Ms. MCCARTHY. Well, we have indicated that the monthly cost 

of electricity at its peak will be somewhere around a gallon of milk 

cost. But we also recognize that when demand-side reduction is 

used, which is the easiest, quickest, and usually the preferred approach of States, that it actually reduces the bill itself, because 

while the rates go up slightly—— 

Mr. WALBERG. But it reduces it based upon Americans using less 

electricity; not the fact that the cost of electricity goes down, but 

making it impossible for Americans to use electricity as they ought 

to be allowed to use electricity. 

Ms. MCCARTHY. Actually, the amount of increase in the rates is 

well within the range of fluctuation that we have been seeing. So 

we are quite convinced—— 

Mr. WALBERG. Through scarcity. Through scarcity. That is happening in my district. 

Ms. MCCARTHY. I am sorry? 

Mr. WALBERG. That is through scarcity. The push is to reduce 

electricity by saying to the consumer don’t use electricity. 

Ms. MCCARTHY. Actually, no. 

Mr. WALBERG. It is not by reducing the cost of production of it. 

Ms. MCCARTHY. It is actually by providing them more opportunities to reduce waste, which I think—— 

Mr. WALBERG. Well, does the Clean Air Act give EPA the authority to regulate American electricity consumption? 

Ms. MCCARTHY. We are not suggesting that we do regulate that. 

We are regulating pollution at the source. 

Mr. WALBERG. Well, now that I got that off my chest, because we 

are entitled to our opinion, but not to the facts, and the facts are 

very much different than that when we are pushing consumption 

as the issue; and in America that isn’t the normal way of doing it. 

Let me go back to some of the Administration questions that I 

have concern with. 

49 

Does Beth Craig, who served as former deputy assistant administrator in the EPA’s Office of Air and Radiation, still work and receive salary from the EPA? 

Ms. MCCARTHY. Yes, she does. 

Mr. WALBERG. You, of course, we already know from testimony, 

are aware that she cost the Government by not overseeing the special agent man, Mr. Beale, at least $200,000 of cost to the taxpayers that were fraudulent. In your agency’s website it says, To 

meet our mission as a high-performing organization, EPA must 

maintain and attract the workforce of the future, modernize our 

business practices, and take advantage of new tools and technologies. 

Can you explain how Beth Craig, a current EPA director who has cost the Government nearly $200,000, is part of the workforce of 

the future? 

Ms. MCCARTHY. Well, I want to first point out, sir, that there is 

no indication, and the OIG has confirmed this, there is no evidence 

that she actually contributed to any fraudulent activity or she was 

involved in any. Now, clearly Beth Craig is now being looked at in 

terms of whether or not she diligently looked at time and attendance sheets and travel. That administrative process is proceeding. 

Mr. WALBERG. The OIG confirmed $200,000, and her management of that, her administration of that allowed that to happen 

over the course of a decade. 

Ms. MCCARTHY. Whether or not Beth did—— 

Mr. WALBERG. And she is still being paid by the taxpayer. And 

if that is the workforce of the future—— 

Ms. MCCARTHY. Well, she has not been accused of any fraudulent 

activity. The question was whether she was diligent enough—— 

Mr. WALBERG. And I am over time, I yield back, but the question 

is why not. 

Mr. MEADOWS. I thank the gentleman from Michigan. 

The chair recognizes the gentleman from Arizona, Dr. Gosar. 

Mr. GOSAR. Thank you very much. 

Administrator McCarthy, in August 2011, President Obama acknowledged in a letter to Speaker Boehner that seven new proposed regulations would each cost the economy at least a billion 

dollars annually. In fact, out of those seven, four of those regulations were put forth by the EPA. I repeat, four. How many new 

regulations has the EPA proposed this year that will cost the economy at least a billion dollars annually? 

Ms. MCCARTHY. I don’t have that figure, sir. 

Mr. GOSAR. Can you provide those names and those numbers and 

estimates to the committee? 

Ms. MCCARTHY. Of course. 

Mr. GOSAR. Now, as you know, Congress has repeatedly rejected 

previous cap and tax energy plans proposed by the President and 

his big government allies, knowing he can lawfully enact a carbon 

tax plan, he can’t, he has instructed you to circumvent Congress 

and to impose these new regulations by fiat. Do you believe the 

EPA should follow the intent of Congress when implementing new 

regulations? 

Ms. MCCARTHY. I believe that EPA is actually following the law 

that Congress enacted in a way that we are supposed to implement 

50 

it, and I think that has been confirmed by the Supreme Court 

every time it has been asked of them relative to carbon pollution. 

Mr. GOSAR. Well, 83 percent, so remember that carefully here. 

And I am glad you bring that up. So will you return the new waters of the U.S. proposed rule to your agency in order to address 

the legal, scientific, and economic deficiencies of that proposal? 

Ms. MCCARTHY. I am sorry, I didn’t understand the question. 

Mr. GOSAR. So citing the Supreme Court again, I want to just 

give you a little background. The Supreme Court has issued four 

decisions that reinforce the limits of the EPA’s jurisdiction on waters of the U.S. 

Ms. MCCARTHY. Yes. 

Mr. GOSAR. Yet you seem to have another effect that you want 

to violate this with this current set of rules. So I am asking you 

will you return the new waters of the U.S. proposed rule to your 

agency to address the legal, the scientific, and economic deficiencies 

of your proposal? 

Ms. MCCARTHY. Well, it is out for public comment now, sir, and 

it was specifically put out in order to address the concerns raised 

by the Supreme Court in terms of the jurisdiction of the Clean 

Water Act. 

Mr. GOSAR. Once again, it has been identified legally with economic deficiencies and scientific deficiencies, yes it has. There are 

four Supreme Court rulings. You just acknowledged the gentleman 

from Virginia that the Supreme Court had the rule of the land. 

There are four jurisdictions from the Supreme Court that limit the 

EPA and its jurisdiction of the waters of the U.S. Will you return 

it to your agency? 

Ms. MCCARTHY. I am happy to have more discussions about this, 

sir, but the reason we put out the waters of the U.S. was exactly 

to address the issues that the Supreme Court has put squarely in 

front of us. 

Mr. GOSAR. I don’t think that is true. 

Ms. MCCARTHY. Okay. 

Mr. GOSAR. Furthermore, David Sundling, the founding director 

of the Berkeley Water Center and professor in the College of Natural Resources of the University of California, Berkeley, found 

major flaws in your agency’s economic analysis of the waters of the 

U.S. proposed rule and claimed the errors in the study are so extensive as to render it unusable for determining the true costs of 

the proposed rule. Once again, does your agency have any plans to 

correct this flawed economic analysis? When you put stuff out, you 

have to cede proper information to the public, and you are not. 

Ms. MCCARTHY. Certainly we are in a comment period where we 

will take a look at that criticism and whether or not it is substantive and how we would address it. We have recently extended 

the comment period 90 days exactly because we know that there 

are concerns raised about the proposal and we want to provide 

clear public opportunity to comment on this so we can understand 

the issues that have been raised. 

Mr. GOSAR. It is interesting that you keep doing that, but you 

have to provide the public proper information, and this is completely flawed. 

Now, I have limited time. 

51 

Ms. MCCARTHY. Okay. 

Mr. GOSAR. Your greenhouse gas rule proposed to threaten the 

close of the Navaho Generating Station and kill 1,000 jobs in Page, 

Arizona. Approximately 80 percent of those positions are good paying jobs for Native Americans in a very rural area. Besides being 

a critical employer, the Navaho Generating Station provides the 

power that delivers more than 500 billion gallons of Colorado River 

water to more than 80 percent of Arizona’s population. Do you believe, yes or no, that the Navaho Generating Station should be 

closed? 

Ms. MCCARTHY. I have no such belief, no. 

Mr. GOSAR. Okay. Do you share my belief that this power plant 

is a special situation due to the Tribal Indian Congressional Dialogue Trust obligations that were constituted by Congress in directing the construction, the direction, the obligations, water settlements, labor law directives associated with that plant? 

Ms. MCCARTHY. My understanding of that plant is it is one of the 

most complicated situations that we have to deal with, so it is fairly unique, yes. 

Mr. GOSAR. It is very unique because of where it sits on tribal 

land and congressional oversight. 

Ms. MCCARTHY. I agree. Yes. 

Mr. GOSAR. So it deserves special attention instead of what it has 

been getting lately. 

Ms. MCCARTHY. Actually, sir, we have been giving it special attention because the proposal that we put out on our clean power 

plan actually didn’t speak to the Navaho Generating Station. We 

actually left the tribal units so that we could do a much more extensive analysis. There are three, one of which is Navaho. 

Mr. GOSAR. I understand. And in the trust obligations the jurisdiction over the tribes in those contracts is this body here, Congress. Have you directed those conversations with Congress as 

well? 

Ms. MCCARTHY. Actually, I don’t know what conversations you 

are referring to. EPA definitely has been given the obligation to 

regulate pollution from that facility if we feel like it is necessary 

for public health. We have actually worked through a lot of tough 

issues with Navaho Generating Station, working with the Navajos, 

working with the other tribes that have an interest, the Hopi and 

the Healer River. We have actually worked very closely with the 

State, Salt River project. I understand how complicated this issue 

is. We have worked through some pretty big challenges in creative 

ways and I am sure we can work through this when the time 

comes. But we have not yet proposed any regulation of carbon pollution from that facility. 

Mr. GOSAR. Well, I would caution the lady that there is also another jurisdictional aptitude, and that is this body, this body of 

Congress that oversees the trust obligations of the tribal entities, 

and that has not occurred. So, fyi, include us. 

I yield back the balance of my time. 

Mr. DUNCAN. [Presiding.] Thank you very much. 

Mr. Collins is next. 

Mr. COLLINS. Thank you, Mr. Chairman. 

52 

Thank you for being here this morning. I know there are a lot 

of management issues at EPA, which has been discussed, and I 

know there is a lot more of oversight from basically John Beale to 

Pebble Mine to employees not being fired for watching pornography, all these other issues. But I want to really take another 

step, take my five minutes and sort of continue some of the conversation you just had, but from a different perspective, from the 

northeast order perspective about the Clean Water Act and affecting the waters of the United States. 

The rule would vastly expand EPA’s regulatory jurisdiction and 

in turn would impugn businesses and families in Georgia’s 9th 

Congressional District and across the Country. If this rule is allowed to go into effect, basically dry ditches, rainwater runoffs, low 

lying areas, and seemingly any area that would hold water would 

be subject to EPA’s jurisdiction. This would force northeast storages, cattle ranchers to move their herds, chicken farmers to move 

their chicken houses, and average citizens to sell to the EPA for 

permission to build on their land. 

Actually, it takes it a step further, and I think this is the concern 

that I have. Not just the production being done now, but in many 

of my areas, my farmers, my grandparents, who dairy farm, and 

I know there is an example just down the road from where I live, 

where a gentleman has 100 acres of land. Most of it grew up in dry 

gulches like we most know. But under these kind of rules basically 

would make his land unsellable because of this process. And this 

is a very real concern to what we have. 

So just a question, administrator. Do you have a dollar value on 

the impact this proposed rule would have? Any kind of a guess? 

Ms. MCCARTHY. Actually, I do not believe there was an economic 

analysis associated with this because it is a jurisdictional question. 

But I would point out—and I am happy to have further conversations in Georgia about this—we have done, I think, a very good job 

at trying to not just recognize the exemptions that exist in the 

Clean Water Act relative to agriculture, but to try to expand those 

in this, and to not write this in a way that would expand the jurisdiction of the Clean Water Act and, in fact, try to make it narrower 

on the basis of real science. So I do think there is a large gap between our intent and I think how we wrote it and how it is being 

perceived; and EPA has a big job to do to close that gap. 

Mr. COLLINS. And I think what you have stated here is the dialogue that goes on that I have all the time with our constituents 

that I have been facing myself, and I think it goes back also to an 

issue here of and you talked about it is a jurisdictional issue, not 

a cost issue. Well, I think that is the problem that we are having 

right now, is that there is regulation after regulation or jurisdictional fights, whatever you want to call it, but the bottom line is 

it affects the taxpayers, it affects the people who fund the Government who want to say why is the Government so affecting in my 

life, especially in areas in which they, frankly, for some of our even 

given some of the Supreme Court rulings, there is an overreach 

here. I do believe there is a balance between carrying out your role 

as an administrator and then also balancing the intent of Congress, 

and I think it goes to Congress being not very good at giving you 

direction. 

53 

Ms. MCCARTHY. I appreciate your concerns, and the more that 

we can actually talk and even meet with your constituents to understand where it feels like two ships passing in the night, and I 

need to bring those together and we have to have a better understanding. And I am entirely open to comment on this. That is why 

we extended the comment period. 

Mr. COLLINS. I have a couple of quick questions I would like to 

get in. 

Under the proposed rule, it is understood that farmers will only 

qualify for Section 404 exemptions if they meet national resources 

conservation and NRCS standards that are currently optional. Yes 

or no, is that true or false? 

Ms. MCCARTHY. No, it is not. 

Mr. COLLINS. It is false. Okay, under current law would a farmer 

be required to the NRCS compliant in order to be exempted? Do 

they have to currently? 

Ms. MCCARTHY. No. 

Mr. COLLINS. So no. If a farmer or rancher has questions on how 

this rule would affect their property or operation, how does the 

EPA respond to these questions? 

Ms. MCCARTHY. We work collaboratively usually with USDA and 

the farmer to understand what their concerns are and to address 

them so they can continue to farm appropriately. 

Mr. COLLINS. What is the average response time? 

Ms. MCCARTHY. I don’t have an answer to that, sir. 

Mr. COLLINS. If you don’t respond in a timely manner, is that 

farmer or rancher protected from fines or punitive actions by the 

EPA if they are not in compliance? 

Ms. MCCARTHY. Could I just clarify one thing? 

Mr. COLLINS. Go ahead. 

Ms. MCCARTHY. EPA is often not the permitting entity here, so 

it is very often a State or Army Corps. 

Mr. COLLINS. Well, you have hit something for me perfectly. I believe this is more of a State issue, and not a national EPA issue. 

We have just probably a fundamental difference in national; in 

fact, EPA exposure and States are doing some of this. I think you 

perfectly hit it for me, but we just honestly disagree. 

Ms. MCCARTHY. I actually don’t think we have any disagreement 

in hopefully how we do this rule. 

Mr. COLLINS. Except maybe in the fact that I don’t believe your 

position should even exist. I think the States can do it now. 

Ms. MCCARTHY. Well, that may be a difference between us. 

Mr. COLLINS. Now we have an interesting issue. But I just want 

you to know—— 

Ms. MCCARTHY. It might be a fundamental difference as well. 

Mr. COLLINS. That is a fundamental difference at that point. But 

I have already commented in opposition to this proposal. I know 

that many in Georgia in my district are. But I have one quick question, and maybe you can clarify this for me. In your conversation 

with my good colleague, Ms. Speier, just a moment ago, did I hear 

you say that you went to the CIA first? 

Ms. MCCARTHY. No, I never talked to the CIA about anything, 

not directly, no. 

54 

Mr. COLLINS. Okay. I believe I heard you say in discussion on the 

bill that you went to the CIA first. 

Ms. MCCARTHY. No. What I indicated was I went to our office 

that deals with our human resource issues. They actually brought 

in our Office of General Counsel. They referred this to our Homeland Security Office, which is the liaison with the intelligence community. They actually communicated with the CIA in seeking 

verification of whether or not John Beale worked for them in some 

way and under what circumstances that occurred. 

Mr. COLLINS. Just wanted to make sure for the record that I 

heard you correctly. 

Mr. Chairman, I yield back. 

Ms. MCCARTHY. Could I just answer one question? I want to 

make sure—— 

Mr. MEADOWS. [Presiding.] The time has expired, but, yes, you 

can answer. 

Ms. MCCARTHY. I just want to clarify. When we were talking 

about the Clean Water Act exemptions, I want to make sure that 

I understood your questions, because the Clean Water Act exemptions clearly indicate where there is agricultural exemptions, the 

additional work that we tried to do with USDA to identify other 

work that was exempted, as long as it is conservation efforts working with USDA, was in addition to those exemptions. And I just 

wanted to make sure I answered you correctly. 

Mr. COLLINS. And I appreciate that. 

Mr. Chairman, if I can have just a moment. 

Because this is the problem, and it exists, because you have people who have real issues and real problems, they see EPA from 

State level or national level. They can’t get the answers, and I 

think this is the problem that develops around this whole thing. 

Again, we forget the end result is not about a building up here in 

Washington that turns out rules; it is about the people that get up 

every day and want to have their own way to do their living and 

make their life, and do with as least interference in the way that 

they can. 

Mr. Chairman, I appreciate it. 

Ms. MCCARTHY. And I also understand that there was an economic analysis done with this rule, so I apologize. We will get that 

to you. 

Mr. MEADOWS. Okay, the time has expired. I thank the gentleman from Georgia. 

The chair recognizes the gentleman from Michigan, Mr. 

Bentivolio. 

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

Administrator McCarthy, thank you for being here today. Do you 

know the current location former EPA employee Phil North? 

Ms. MCCARTHY. No, I do not, sir. 

Mr. BENTIVOLIO. Administrator McCarthy, are you aware that 

Mr. North left the country, traveling to New Zealand, when this 

committee had a pending request to voluntarily attend a transcribed interview? 

Ms. MCCARTHY. No, sir, I don’t know that. 

55 

Mr. BENTIVOLIO. Has the EPA produced to the committee all of 

Mr. North’s emails since 2002 regarding his work on the Pebble 

Mine in Bristol Bay? 

Ms. MCCARTHY. We have submitted all that we have identified, 

and we continue to search. 

Mr. BENTIVOLIO. Okay. Are you aware that the EPA cannot 

produce all of Mr. North’s emails to the committee because his 

hard drive crashed and the EPA did not back up Mr. North’s 

emails? 

Ms. MCCARTHY. I am aware that Mr. North was stationed actually in a pretty remote area of Alaska. We are aware and we notified the committee as soon as we were aware that there are some 

gaps, but we have already submitted a significant amount. So it is 

not clear how much we might have missed, but we are looking at 

it. 

Mr. BENTIVOLIO. Let’s see, I got the IRS and the EPA. What is 

it with bureaucrats and Government agencies when this committee 

is investigating, trying to find out about their personal emails or 

emails on an EPA or Government computer, the hard drives crash? 

Is the EPA in possession of Mr. North’s failed hard drive? 

Ms. MCCARTHY. I am not aware. I don’t know, sir, but I can find 

out. 

Mr. BENTIVOLIO. Did Mr. North ever receive a bonus? 

Ms. MCCARTHY. I don’t know the answer to that question. 

Mr. BENTIVOLIO. Did John Beale, fraudulent CIA, EPA employee 

get a bonus? 

Ms. MCCARTHY. Not under my watch. I don’t know what happened prior to that. 

Mr. BENTIVOLIO. Ever? 

Ms. MCCARTHY. I don’t know. 

Mr. BENTIVOLIO. Okay. Did Beth Craig, who lied to special 

agents investigating John Beale, get a bonus? 

Ms. MCCARTHY. I don’t know exactly. 

Mr. BENTIVOLIO. How about the employee who had 7,000 pornography files on his EPA computer ever receive a bonus? 

Ms. MCCARTHY. I don’t know, sir. 

Mr. BENTIVOLIO. Susan Strassman-Sundy, who produced no work 

in the last five years working from her home, did she ever receive 

a bonus? 

Ms. MCCARTHY. I do not know her or the facts of that. 

Mr. BENTIVOLIO. Ms. Renee Page, selling jewelry and weight loss 

products from her EPA office, get a bonus? 

Ms. MCCARTHY. I do not know the answer to that. 

Mr. BENTIVOLIO. Unnamed EPA employee receiving paychecks 

while in a nursing home for two years. By the way, is he still getting paid? 

Ms. MCCARTHY. I do not know the answer to that question, sir. 

I don’t know the issue you are referring to. 

Mr. BENTIVOLIO. I have working middle-class Americans in my 

district who are struggling to make ends meet, and employees at 

the EPA are playing James Bond, watching porno movies on EPA 

computers at EPA time. Nothing is getting done. They are struggling and you don’t know where your money is being spent. 

Thank you very much, Mr. Chairman. I yield back. 

56 

Mr. MEADOWS. The gentleman yields back. 

The chair recognizes the gentleman from Tennessee, Mr. Duncan. 

Mr. DUNCAN. Well, thank you very much, Mr. Chairman. Mr. 

Chairman, I think most of us, at least on this side, realize that 

there is more anger and resentment and disgust with the Federal 

Government probably today than any time in our history because 

almost every day people are reading stories or hearing stories 

about tremendous, ridiculous waste, inefficiency, over-regulation by 

the Federal Government. Also, I think they resent the fact that almost nobody or very few in the bureaucracy have ever spent any 

time running a small or medium-sized business, and they have no 

idea or understanding of the pressures, how hurtful it can be to 

have to lay off people during slow times, and things of that nature. 

But the disgust I think probably hit its height when they heard and read about a high EPA up official receiving $900,000 over a 

several year period for doing no work and even taking paid vacations on the taxpayer dollar; and I want to get back into that in 

just a moment. We were given background material that says before the President nominated McCarthy to head the EPA, she 

served as assistant administrator of the Office of Air and Radiation 

from 2009 to 2013. While McCarthy was aware of Beale’s frequent 

absences and lack of work product, she never adjusted Beale’s pay 

or discontinued the unauthorized retention incentive bonuses 

which made Beale the highest paid employee in OAR during her 

tenure. 

And then it goes on, In fact, EPA officials wrote an entire report 

entitled John Beale Pay Issues in July 2010, which McCarthy was 

aware of by at least January 2011. Despite recommendations to 

cancel Beale’s bonuses, McCarthy halted the internal revenue and 

permitted the unauthorized bonuses to continue. Both McCarthy 

and Bob Perciasepe attended Brenner and Beale’s joint retirement 

cruise in 2011. 

And now we hear Ms. McCarthy say that Mr. Beale received no 

bonuses. But we have an email here, and I think they put up on 

the board there, in which this was Ms. McCarthy’s response to an 

OAR official asking, ‘‘Has Craig’’—that is Craig Hooks—‘‘gotten 

back to you about the pay issue yet? I am eager to move ahead 

with canceling the bonus.’’ McCarthy replied, No, he hasn’t. It is 

now in his hands, as far as I am concerned, showing, really, a 

hands off attitude about bonuses for this man who did no work and 

who defrauded the taxpayers out of $900,000. And the title of this 

hearing is Management Failures: Oversight of the EPA. 

And that, I think, shows why this hearing was necessary. But I 

will tell you, Ms. McCarthy, as concerned as I am about that, I am 

more concerned about something else. President Obama said, a few 

years ago, he said, Under my plan of a cap and trade system, electricity rates would necessarily skyrocket, regardless of what I say 

about whether coal is good or bad, because I am capping greenhouse gases. 

The problem with that is, and we don’t have enough people at 

the EPA because they have these high-paying jobs, they don’t understand that a lot of people in my district and around the Country 

have trouble paying their utility bills And if we triple or quadruple 

57 

these utility bills, it is going to hurt a lot of poor and lower income 

and working people; and I don’t think the people at the EPA keep 

that in mind and I don’t think they realize, too, that if you come 

out with more and more regulations, it helps the big giants. It 

helps the big, big companies, but it hurts the little guys. 

Overregulation by the Federal Government, not only by the EPA, 

but a lot of it by the EPA, a lot of it has run small and mediumsized businesses out of business or forced them to merge or forced 

them to go to other countries. We have sent millions of good jobs 

to other countries. For the last 40 or 50 years, we have ended up 

now with the highest paid waiters and waitresses in the world, and 

a lot of it, in fact, I think the majority of it is because of environmental overregulation and red tape. 

That is all I have to say, Mr. Chair. 

Ms. MCCARTHY. Might I clarify something? 

Mr. DUNCAN. Yes, ma’am. 

Ms. MCCARTHY. I just wanted to clarify that the bonus issue I 

was answering I didn’t realize that they were talking about a retention bonus. And that bonus I did not give; it was actually 

awarded earlier. It continued to be on the payroll. I sought that to 

be off the payroll on numerous occasions. And that is one of the 

issues we are trying to get compensation back. 

Mr. DUNCAN. Well, you were the head of this OAR in 2009, right? 

Ms. MCCARTHY. I did, and I alerted—— 

Mr. DUNCAN. And 2010? 

Ms. MCCARTHY. My understanding—— 

Mr. DUNCAN. And 2011. 

Ms. MCCARTHY. My understanding at that point—— 

Mr. DUNCAN. And Mr. Beale was employed by that agency, the 

highest paid employee of that agency—— 

Ms. MCCARTHY. Right. 

Mr. DUNCAN.—during 2009, 2010, and 2011. 

Ms. MCCARTHY. It was just my recollection that when I brought 

this to his attention, he advised me not to take action because he 

needed to communicate it to the Office of Inspector General, and 

that I should not alert Mr. Beale to any potential investigation. 

That is what that email reflected. 

Mr. DUNCAN. If the chairman would allow me just one other 

thing, though. I will tell you this. Johnny Pesky was a real close 

friend of mine, and he has had me in the dugout at Fenway Park. 

Ms. MCCARTHY. Really? 

Mr. DUNCAN. And I was glad a few times, and I am sure if are 

a Red Sox fan you have heard of Johnny Pesky. 

Ms. MCCARTHY. I sure have. 

Mr. DUNCAN. He was a great man. You and I can at least agree 

on that. 

Ms. MCCARTHY. He is spoken in the same breath as Ted Williams, and it is great. Thank you. 

Mr. MEADOWS. The gentleman from Tennessee’s time has expired. 

The chair would recognize the gentlewoman from Wyoming, Mrs. 

Lummis. 

Mrs. LUMMIS. Thank you, and welcome, Ms. McCarthy. 

Ms. MCCARTHY. Thank you. 

58 

Mrs. LUMMIS. We have been waiting, as I understand it, for 

about seven months for a response about the scientific and other 

bases for regulations that will increase energy costs on low and 

middle income Americans, as well as the cost of doing business, 

and will lead to some job losses, certainly; and I am curious. You 

received a set of science committee questions for the record, after 

you testified last November. When will you be responding to those? 

Ms. MCCARTHY. Actually, if this has to do with House Science 

and Technology, we did receive a subpoena. We did respond to that 

and we believe that issue has been closed out. 

Mrs. LUMMIS. And could you tell me when that was? Because I 

am on the Science Committee, as well as this committee. These 

were questions for the record submitted to you on December 17th 

regarding the peer review process behind the new source performance standard, the integrity of the EPA’s ongoing hydraulic fracturing study, revisions to ozone regulations, sue and settle, lack of 

data transparency, and some other—— 

Ms. MCCARTHY. I am sorry, I didn’t realize that you were asking 

about questions for the record, which they are in the process now. 

I will get back to you in terms of the timing on responding to those. 

Mrs. LUMMIS. Okay. 

Ms. MCCARTHY. I apologize, I didn’t realize what you were referring to. 

Mrs. LUMMIS. And I apologize, I am just sort of breezing in from 

another committee. 

Ms. MCCARTHY. That is okay. 

Mrs. LUMMIS. These were given to you on December 17th of 2013 

and were questions for the record. I am the Energy Subcommittee 

chair—— 

Ms. MCCARTHY. Thank you. I will look into it and we will get 

right back. 

Mrs. LUMMIS. That would be great. Any chance we could hear 

back by July 14th, about three weeks from now? 

Ms. MCCARTHY. Let me see what the status is and we will get 

back to you by the end of the day in terms of what we think our 

timeline might be. I have certainly noted that you are interested 

in having it by then. 

Mrs. LUMMIS. Thank you very, very much. 

Another question. Under the EPA’s proposed rule to restrict carbon emissions from existing power plants, does the cost per kilowatt hour go up or down? 

Ms. MCCARTHY. The cost per kilowatt hour by 2030 is estimated 

to go up slightly in some areas. 

Mrs. LUMMIS. Okay. And those areas are areas that are currently—— 

Ms. MCCARTHY. Actually, it depends. What we do is we look at 

what kind of response we anticipate States to take, but one of the 

issues that we are looking at, and clearly reliability and affordability of the energy supply is one reason why we did this as flexibly as possible with individual State standards and individual 

plans, was to hear back during the comment period on what States 

thought was their path forward so we could do a good job on the 

final in estimating those costs. 

59 

Mrs. LUMMIS. Now, is it true that in order to make the claim 

that the rule lowers energy cost, the EPA has to rely on an assumption that, overall, electricity consumption will be reduced? 

Ms. MCCARTHY. It is actually recognizing that over that period 

of time the most cost-effective strategy to achieve the reductions at 

these fossil fuel plants is to actually look at demand reduction; and 

that provides an opportunity not just for reduced carbon, but also 

continued opportunity for economic growth. This is not a cap program; this is an intensity goal. So it doesn’t limit the ability to 

grow economically; it looks at how you produce energy in a way 

that says low carbon, less waste, better use of low carbon sources. 

Mrs. LUMMIS. So in order to say that the rule lowers energy 

costs, you have to assume that consumers will be paying more for 

electricity per kilowatt hour, but using less power overall, is that 

true? 

Ms. MCCARTHY. We don’t have to make those assumptions. We 

are recognizing that there will be some fluctuation in cost; it will 

be fairly minor over time. But we also recognize that this concern 

about affordability, and if you balance the way in which States 

have to achieve these standards, they could do it in a way that actually lowered bills for people and consumers in the end of this 

process. 

Mrs. LUMMIS. Well, I am terribly concerned about how this rule 

is going to affect consumers in Wyoming. There are so many middle 

and lower income people just trying to make ends meet, and when 

the cost of electricity goes up over our current coal-fired power 

plants, most of which are fully depreciated and are being retired 

prior to the end of their useful life. 

For example, because of these rules, the Neal Simpson Plant in 

Campbell County, Wyoming, its Unit 1 was recently retired fully 

10 years before its useful life had expired. And had it been able to 

carry on for the entirety of its useful life, the consumers in Wyoming would have been able to enjoy lower utility rates. Now it will 

be replaced by a higher cost brand new plant and, hence, my concern about the average American consumer. 

Thank you, Mr. Chairman. I yield back. I apologize for running 

over. 

Mr. MEADOWS. I thank the gentlewoman from Wyoming. 

The chair recognizes himself to ask a few questions, Ms. McCarthy. 

As I stated earlier, I could go on and on CTS and we would be 

here long after. It has been a long morning, so I am going to abbreviate some of those. Dot Rice and CTS have become a household 

name over the last 13 or 14 months for me. It didn’t start on your 

watch, it didn’t start on my watch, but it will finish on our watch; 

and I need your assurances that not only will we do additional testing, but that we will get the site cleaned up. Can I have your assurances of that today? 

Ms. MCCARTHY. Well, that will be our shared goal, sir. 

Mr. MEADOWS. I know that is your goal, but it has been your 

goal for 25 years that it would be cleaned up, and nothing has 

started. Do we have your assurances that it will get cleaned up? 

Ms. MCCARTHY. I can’t give you a timeline for that, sir. It would 

be something totally out of my control. 

60 

Mr. MEADOWS. So let me ask you what is a reasonable amount 

of time? Knowing that the public health is your central focus. 

Ms. MCCARTHY. It is. 

Mr. MEADOWS. And this has been 25 years contaminating the 

groundwater and air of people that I represent. How long does it 

take to come up with an action plan? 

Ms. MCCARTHY. I don’t know in this instance. I understand it is 

complicated, but I also understand your frustration. Why don’t we 

just get together and figure out how you can be confident that we 

are moving with as much speed and as diligently as we can? 

Mr. MEADOWS. Okay. Ms. Rice has given me 10 questions that 

I need answered. If I submit those to you, can you have those back 

to this committee within the next 30 days? 

Ms. MCCARTHY. I will do the very best I can. 

Mr. MEADOWS. So let me go on a little bit further. Today we have 

talked about the EPA mission and how important it is. So let’s look 

at Superfund sites. There are currently 1,164 sites on the Superfund priority list. Eighty-one percent of those have been there over 

20 years. Eight-one percent of them. So we have been dealing with 

most of those sites for over 20 years. If the EPA is very effective 

of cleaning up what we know are a priority because it is a priority 

list, and it is toxic, many of them toxic, is it not hypocritical that 

we continue to pass new rules trying to do something and clean up 

the air and water when we have known areas that we are not 

cleaning up? What is the issue? 

Ms. MCCARTHY. Well, I think we try to address the priorities as 

they come up. I don’t want folks to think that Superfund sites have 

made no progress that have been in the system for a long time. 

Mr. MEADOWS. Well, I have the records. Three hundred sixtythree of them have come off of the list out of 1527. 

Ms. MCCARTHY. Right. That is a complete cleanup. 

Mr. MEADOWS. So that is a batting average of 237. Even the Boston Red Sox wouldn’t trade a draft pick for that. 

Ms. MCCARTHY. Well, one of the challenges we face is to make 

sure that we take care of the immediate impacts on public health. 

One of the first things—— 

Mr. MEADOWS. But you haven’t done that in my district. 

Ms. MCCARTHY. Well, we need to talk about that. But one of the 

first things we do at these Superfund sites is to ensure that they 

are not continuing to pose a health threat—— 

Mr. MEADOWS. But you didn’t do that in my district. 

Ms. MCCARTHY.—while we work long-term to clean it up. 

Mr. MEADOWS. You know. You have been briefed on mine because they have told me in Region 4 they briefed you before you 

were coming here today. 

Ms. MCCARTHY. Well, they sent me a couple pages, yes. 

Mr. MEADOWS. You know that that didn’t happen, is that correct? 

Ms. MCCARTHY. I know that there has been some immediate effort to take care of some vapor intrusion issues, and I think that 

was a long process. 

Mr. MEADOWS. Only in the last 60 days. 

Ms. MCCARTHY. We will work together. I don’t know what to tell 

you. 

61 

Mr. MEADOWS. Do I have your commitment today that you will 

work with me and keep my office informed before you inform the 

WLOS or any of the others? Because I am learning about it from 

the news media, and I have been working on this for 13 months. 

Do I have your commitment today? 

Ms. MCCARTHY. We will do our best job to have no surprises for 

you, sir. 

Mr. MEADOWS. Do I have your commitment, yes or no? 

Ms. MCCARTHY. We will do the best job we can. 

Mr. MEADOWS. Okay, so I would take that as a no. 

Ms. MCCARTHY. No. In the issue that you are referring to, it had 

to do with some private information—— 

Mr. MEADOWS. No it did not, Ms. McCarthy. 

Ms. MCCARTHY. That was my understanding. 

Mr. MEADOWS. I know that is what they are telling you. What 

is private about the EPA going to do a test? It has nothing to do 

with tax records; it has nothing to do with health. It has to do with 

our actions. There is no constitutional right to privacy for that, Ms. 

McCarthy. 

Ms. MCCARTHY. We do everything we can to not surprise the 

folks that represent the people—— 

Mr. MEADOWS. Well, I would disagree with you. So let me go on 

a little bit further. 

Ms. MCCARTHY. Let me tell you we will do better. 

Mr. MEADOWS. Okay. 

Ms. MCCARTHY. I mean, I will work hard to do better. I don’t 

want surprises because I know this is an issue—— 

Mr. MEADOWS. Well, it will continue to come up until we get it 

cleaned up. 

Ms. MCCARTHY. Okay. 

Mr. MEADOWS. Okay. So let me go back to the public mines that 

Mr. Bentivolio brought up. He brought up this thing about Pebble 

Mine in terms of—it sounds like we have another missing hard 

drive, is that correct, Ms. McCarthy? 

Ms. MCCARTHY. I do not know whether that is the case. 

Mr. MEADOWS. Does your counsel behind you? I think he is shaking his head yes. Do we have a missing hard drive? 

Ms. MCCARTHY. I don’t believe this is a missing hard drive issue. 

There is a challenge getting access to the data on it—— 

Mr. MEADOWS. So is it a crushed hard drive? What does your 

counsel tell you? I mean, you brought your counsel here. I assume 

he is here to tell you. 

Ms. MCCARTHY. He just told me we are having trouble getting 

the data off of it and we are trying other sources to actually supplement that, but we are working through the issue. 

Mr. MEADOWS. So do you believe you can get the data? 

Ms. MCCARTHY. We are increasingly getting information in different ways and we are taking a look at it. 

Mr. MEADOWS. All right, so the Federal Records Act came up yesterday in a hearing. 

Ms. MCCARTHY. Yes. 

Mr. MEADOWS. I noticed it didn’t get brought up today, but it 

looks like the Federal Records Act has been violated by the EPA. 

62 

Did the gentleman that was involved from Alaska, did he print out 

his emails? 

Ms. MCCARTHY. That is not required, sir. 

Mr. MEADOWS. Did he preserve his emails? That is required by 

the Federal Records Act. 

Ms. MCCARTHY. I can’t know where the failure occurred. We are 

talking about a series of emails where it is not one particular incident, it is an individual that is located in the Kenai Peninsula. 

Mr. MEADOWS. So you are saying you can’t collect stuff because 

it is a long ways away? 

Ms. MCCARTHY. No, no. I am just saying that we are challenged 

in terms of trying to figure out where those small failures might 

have occurred and what caused them to occur. But we have produced a lot of information. These are pretty old documents—— 

Mr. MEADOWS. I understand. I heard very similar testimony yesterday that a lot of documents had been produced. You gave a 

great answer to a question I didn’t ask. 

Ms. MCCARTHY. Okay, what is your question, then? 

Mr. MEADOWS. My question is were all his emails preserved according to the Federal Records Act? Were they all preserved or was 

a law violated? 

Ms. MCCARTHY. Originally you asked me if he preserved them. 

That is what I was—— 

Mr. MEADOWS. Were they all preserved? 

Ms. MCCARTHY. I think we have notified the appropriate authorities that we may have some emails that we cannot produce that 

we should have kept, and we have notified—— 

Mr. MEADOWS. So I am not aware that you—— 

Ms. MCCARTHY.—whether we can recover all these or not. 

Mr. MEADOWS. So did you notify the National Archives? 

Ms. MCCARTHY. Yes, we did. 

Mr. MEADOWS. When did you do that? 

Ms. MCCARTHY. Yesterday. 

Mr. MEADOWS. After the hearing. 

Ms. MCCARTHY. Well, it became clear that—— 

Mr. MEADOWS. So yesterday it became clear that you didn’t have 

emails? 

Ms. MCCARTHY. Actually, no. We informed the committee when 

we identified this problem, and we kept them abreast; and I, in the 

end, am not sure whether or not we won’t recover all of it. The 

question I understood you might ask was whether we have already 

identified, and we did and we are where I think we need to be, but 

I am still hoping that we recover all those emails. And this is not 

a broad swath of emails over a series of years; these are very selective failures that we haven’t yet understood why those records 

weren’t kept, but it appears that people did what they were supposed to do. 

Mr. MEADOWS. Okay, so yesterday you informed the National Archivist. 

Ms. MCCARTHY. That is correct. 

Mr. MEADOWS. The Federal Records Act actually requires that 

you would notify them at the time that you noticed that you had 

a problem. So it was either that you violated the law or yesterday 

63 

you notified them because you saw it on a hearing and you said, 

oops. 

Ms. MCCARTHY. No, we notified them without telling them that 

we have confirmed that there is a problem, but there is a suspicion 

that we may not be able to locate all of them. And we have properly identified that information. 

Mr. MEADOWS. And that happened yesterday. 

Ms. MCCARTHY. It did. 

Mr. MEADOWS. Wow. Okay, let me go on a little bit further. 

Really, as we start to look at this, you do know that the IG has 

an investigation looking into all this. 

Ms. MCCARTHY. I do, yes. 

Mr. MEADOWS. All right. And do you also know that the committee has been asking for over two years for these documents? 

Ms. MCCARTHY. Which? 

Mr. MEADOWS. Many of the documents, requesting additional 

during the subpoenas investigation during that. 

Ms. MCCARTHY. We actually have complied with some earlier request for information, and we continue to respond as the committee 

looks for additional information. 

Mr. MEADOWS. Okay. Are you aware that with the EPA with regards to a recommended 404 action, kind of the preemptive 404 

veto, are you aware that there might have been some collusion that 

was going on? 

Ms. MCCARTHY. I am aware that people have expressed concern 

about that and it has been referred to the inspector general and he 

is looking into it. 

Mr. MEADOWS. Does that concern you, that there might be collusion? 

Ms. MCCARTHY. I have seen no evidence of it so far, but certainly—— 

Mr. MEADOWS. I didn’t ask you that. I just said would it concern 

you if there was collusion. 

Ms. MCCARTHY. I am actually happy the inspector general is 

looking at this, and I look forward to his report when it is produced. 

Mr. MEADOWS. All right. So if you have a crushed hard drive, are 

you willing to produce that and give that to the committee as well? 

Ms. MCCARTHY. I will be happy to get back to you on that. I just 

want to make sure that I have this right, because the challenge we 

have been having is, again, that this is—we are not sure where the 

failure came from and what it is attributed to, but we will be 

happy to share whatever we have available to the committee. 

Mr. MEADOWS. All right, so it sounds like we just have a whole 

lot of unknowns here as it relates to Pebble Mine, right? I mean, 

with all of this going back and forth and investigation, it sounds 

like there is just a whole lot of uncertainty. 

Ms. MCCARTHY. Actually, what you have expressed—— 

Mr. MEADOWS. Or are you certain what is going to happen? 

Ms. MCCARTHY.—uncertainty about a fish biologist who provided 

input into his expertise on Bristol Bay. I think the thing I want 

to make sure that everybody understands was he is not a decision 

maker in this process; he inputted into the science assessment. 

That has been fully peer reviewed. We have not made any decision 

64 

on Bristol Bay; we have just taken a first step, and it will be a fully 

engaged public process. 

Mr. MEADOWS. But he could have been one of the ones that 

colluded on this. In fact, there have been innuendos made that he 

may very well have been the one. 

Ms. MCCARTHY. Which is why it is important that the inspector 

general conduct their investigation and that we be mindful of the 

report and we take appropriate action. 

Mr. MEADOWS. Well, in light of that, then, wouldn’t you think 

that it would be prudent to cease the 404(c) action at this point, 

until we get all the facts? 

Ms. MCCARTHY. Well, there is no—— 

Mr. MEADOWS. Are you willing to cease that 404(c) action until 

we get the facts? 

Ms. MCCARTHY. No, sir. I don’t see any evidence that there was 

collusion here. And I want to again point out that he is a fish biologist, he is not a decision maker for the Agency. 

Mr. MEADOWS. Well, but collusion by this biologist is still collusion. 

Ms. MCCARTHY. That decision is made on the basis of the 

science. 

Mr. MEADOWS. All right, so let me close with this. What about 

the money that we are spending there on Pebble Mine? What if we 

took that money and we brought it over and cleaned up the CTS 

site? Don’t you think that would be a great idea? 

Ms. MCCARTHY. We all have our priorities, sir. 

Mr. MEADOWS. And CTS is mine. 

Ms. MCCARTHY. That has been made abundantly clear. 

Mr. MEADOWS. I want to be sympathetic to Mr. Cummings, if he 

has some additional questions he would like to ask. 

Mr. CUMMINGS. I promise you I won’t take 12 minutes. 

But let me say this, Ms. McCarthy, as I close, because I have to 

get to a meeting. You have a tough job. You have a tough job. And 

when you are trying to protect the health and the safety of all 

Americans and keep the environment and the water clean, you 

have a tough job. On the one hand we hear folks say don’t regulate 

us too much, but I keep thinking about that situation in West Virginia with the water, and they had to bring in bottled water. And 

I ask myself the question if that happened in various districts 

throughout the Country, that would be a major, major, major problem. So I just want to leave you with two things. 

One, I don’t know if you heard my opening statement when I 

said that this is our watch. And it is our watch to make sure that 

we keep our environment clean, safe, all the things that you try to 

do; our water; all the things you do, the mission of the EPA. But 

at the same time, you know, sometimes if an organization has 

problems within itself, it is kind of hard for it to carry out its mission. When I hire people, I always check with them to make sure 

they are not drama people, because a drama person can mess up 

a whole office. And when you have a drama person, it takes away 

from the ability to accomplish what you set out to do. 

At the same time, when we hear about situations like Beale, it 

really just rubs everybody the wrong way. And the reason why I 

had asked Chairman Issa to let me interject my questions earlier, 

65 

and I have been here for 99 percent of this hearing, is because I 

wanted to make sure that you all, in this moment, this is a critical 

moment, had gotten the wake-up call or calls to take action to 

make sure that we did every single thing in our power to make 

sure another Beale did not happen. And I remember, as I was raising my kids, I used to tell them you are going to be punished today 

because I realized that if I allow this moment to come and you did 

something improper and I don’t correct it, it is usually going to get 

worse. And what I am saying to you is those critical moments come 

along, and Beale is the poster child for a critical moment. The 

question is whether we will take that moment, learn from it, correct it, and put in all the safeguards that are necessary so that it 

does not happen again; but, just as significantly, so that it doesn’t 

get worse. 

So while it is our watch, it is our watch to guard our environment, to take care of our water, to do all those things to keep our 

people safe, but it is also our watch to make,to help the Agency be 

the very, very, very best that it can be. 

The other thing that happens is this: that takes away from that 

is when we have hearings and legitimate questions, but the time 

that we spend dealing with those kinds of issues also takes away. 

But we have to do that. You understand that. This is not personal. 

We have to look into the Beales. We have to do those things. You 

have to ask the critical questions like the chairman was just asking. But we have to also make sure that we do all that we can to 

minimize the problems within so that we can address the problems 

that we are supposed to be addressing. Does that make sense? 

Ms. MCCARTHY. Everything you say is absolutely on target, and 

I want to just verify that I understand the importance of this committee and the work that you do. I understand the importance of 

the Office of Inspector General at EPA. We have challenges to keep 

up with modern times in terms of our systems of accountability. 

We are working through those. 

I was handed a John Beale when I got in there. While I would 

have loved to have corrected that situation and known right out of 

the gate. He is sitting in a jail right now; we got money back and 

I am getting more. I had a town hall just in May on this very issue. 

Two reasons: one is to enforce accountability in our Agency, but, 

secondly, to let my Agency know that I know what we are dealing 

with here is out of 16,000 people I am dealing with a handful; and 

I cannot let that handful of people destroy the morale of my Agency 

and our ability to get done what the public expects us to do. I am 

surrounded by incredibly dedicated, talented people, and I want 

them to be rewarded for what they do and know that when there 

is a bad apple there it is coming out. I am finding it and it is coming out as quickly as I can get it. 

Mr. CUMMINGS. And as I close, in your town hall meeting I hope 

that you addressed the issue of whistleblowing, because I think 

that is the way we can get to some of this. Somebody has to know 

something. So I think that is important. 

But the last thing you said, and I have to end on this, is a lot 

of times we criticize Federal employees, but I have often said that 

when I talk to Federal employees, particularly I have talked to people in your Agency and others, and a lot of these folks, most of 

66 

them, as a matter of fact, they come in and they do these jobs. 

They could make a lot more money outside of Government, but 

they come because it feeds their souls, because they see something 

greater than them. And I see that over and over again with EPA 

employees. So I just want to—and others. But we are talking about 

your Agency today. And I want to thank them because a lot of 

them have sacrificed a lot because they know that it is our watch 

and they are good watch persons trying to make a difference for 

the future. 

Ms. MCCARTHY. Thank you. And it is an honor for me to represent them. 

Mr. CUMMINGS. Thank you. 

Thank you, Mr. Chairman. 

Chairman ISSA. [Presiding.] Thank you. 

Administrator, by our standards, you have done well, and quickly. As we bring it to a close for today, we began with the question 

of the outstanding subpoena. Clearly, I hope that over the next few 

days that our folks and your folks can resolve this with all the 

emails being known and understood. If we can’t, we have already 

had that discussion. But I hope that we can. I am sure that when 

you mentioned in your dialogue at the opening, that you talked 

about the balance of power, that you appreciate that we too have 

an obligation, as Article I, to do that balance fully and freely; that 

the documents we are asking for a court under FOIA would undoubtedly order. And that is really what we are asking for, is to 

be as never less than a FOIA discovery would arrive at, and this 

committee has a recent history in the case of Benghazi investigation of knowing that in fact correspondence from the White House 

is often protected, shielded, and not disclosed to the committee, but 

ultimately a Federal judge seems to be respected. 

As I look at Article I, Article II, and Article III, and I have just 

been over in my other role at Judiciary, I realize that Article I and 

II need to resolve as many things as they can before we go to Article III, before we go to the courts. That is my goal; that is the reason that I would like to have you seriously relook at the issue of 

all of the documents, not just one, since that document, I think if 

you relook at it, you will realize if you have a suspicious nature, 

as my investigators are required to, they could say it asks more 

questions than it answers and it leads to their wanting to see more 

for that reason. So I hope we are able to do this. 

Obviously, we are still trying to get the Pebble Mine question of 

the documentation, the order, and individuals who are not available to us resolved, and we will continue to do that with other committees. 

Lastly, the committee has begun doing interrogatories, whenever 

possible, in order to not need to bring witnesses back. This allows 

you to use a vast portion of your staff to get us answers to questions. There were a number of questions asked today that, by nature, you can’t fully answer, so what we will do is we are going to 

recess. We will present you interrogatories that are consistent either with the discovery questions that we mentioned, and call them 

just questions to EPA, they are either related to today’s hearing or 

they are related to the outstanding subpoenas, and we would ask 

67 

that you respond to them in a timely fashion. Then, once they are 

responded to, we will close the record on this. 

So we will stand in recess on this hearing pending the response 

to all of those. And again I want to thank you for your presence. 

Ms. MCCARTHY. Thank you very much for the hearing and the 

courteous way in which you have run it, and we certainly hope we 

can resolve these issues together. Thank you. 

Chairman ISSA. I do too. Thank you. 

[Whereupon, at 12:28 p.m., the committee was recessed.] 

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