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53–286 PDF 2009

RECOVERY ACT: PROGRESS 

REPORT ON WATER RESOURCES 

INFRASTRUCTURE INVESTMENT 

(111–75) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

WATER RESOURCES AND ENVIRONMENT 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

November 4, 2009 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JAMES L. OBERSTAR, Minnesota, Chairman 

NICK J. RAHALL, II, West Virginia, Vice 

Chair 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

GENE TAYLOR, Mississippi 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

BRIAN BAIRD, Washington 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

MICHAEL A. ARCURI, New York 

HARRY E. MITCHELL, Arizona 

CHRISTOPHER P. CARNEY, Pennsylvania 

JOHN J. HALL, New York 

STEVE KAGEN, Wisconsin 

STEVE COHEN, Tennessee 

LAURA A. RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

SOLOMON P. ORTIZ, Texas 

PHIL HARE, Illinois 

JOHN A. BOCCIERI, Ohio 

MARK H. SCHAUER, Michigan 

BETSY MARKEY, Colorado 

PARKER GRIFFITH, Alabama 

MICHAEL E. MCMAHON, New York 

THOMAS S. P. PERRIELLO, Virginia 

DINA TITUS, Nevada 

HARRY TEAGUE, New Mexico 

VACANCY 

JOHN L. MICA, Florida 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

VERNON J. EHLERS, Michigan 

FRANK A. LOBIONDO, New Jersey 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

JOHN BOOZMAN, Arkansas 

SHELLEY MOORE CAPITO, West Virginia 

JIM GERLACH, Pennsylvania 

MARIO DIAZ-BALART, Florida 

CHARLES W. DENT, Pennsylvania 

CONNIE MACK, Florida 

LYNN A WESTMORELAND, Georgia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

ROBERT E. LATTA, Ohio 

BRETT GUTHRIE, Kentucky 

ANH ‘‘JOSEPH’’ CAO, Louisiana 

AARON SCHOCK, Illinois 

PETE OLSON, Texas 

(II) 

SUBCOMMITTEE ON WATER RESOURCES AND ENVIRONMENT

EDDIE BERNICE JOHNSON, Texas, Chairwoman 

THOMAS S. P. PERRIELLO, Virginia 

JERRY F. COSTELLO, Illinois 

GENE TAYLOR, Mississippi 

BRIAN BAIRD, Washington 

TIMOTHY H. BISHOP, New York 

RUSS CARNAHAN, Missouri 

STEVE KAGEN, Wisconsin 

DONNA F. EDWARDS, Maryland Vice Chair 

SOLOMON P. ORTIZ, Texas 

PHIL HARE, Illinois 

DINA TITUS, Nevada 

HARRY TEAGUE, New Mexico 

ELEANOR HOLMES NORTON, District of 

Columbia 

MICHAEL E. CAPUANO, Massachusetts 

GRACE F. NAPOLITANO, California 

MAZIE K. HIRONO, Hawaii 

HARRY E. MITCHELL, Arizaon 

JOHN J. HALL, New York 

PARKER GRIFFITH, Alabama 

BOB FILNER, California 

CORRINE BROWN, Florida 

VACANCY 

JAMES L. OBERSTAR, Minnesota 

(Ex Officio) 

JOHN BOOZMAN, Arkansas 

DON YOUNG, Alaska 

JOHN J. DUNCAN, JR., Tennessee 

VERNON J. EHLERS, Michigan 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

HENRY E. BROWN, JR., South Carolina 

TODD RUSSELL PLATTS, Pennsylvania 

BILL SHUSTER, Pennsylvania 

MARIO DIAZ-BALART, Florida 

CONNIE MACK, Florida 

LYNN A WESTMORELAND, Georgia 

CANDICE S. MILLER, Michigan 

ROBERT E. LATTA, Ohio 

ANH ‘‘JOSEPH’’ CAO, Louisiana 

PETE OLSON, Texas 

(III) 

(V) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... vii 

TESTIMONY 

Darcy, Hon. Jo-Ellen, Assistant Secretary of the Army for Civil Works, U.S. 

Corps of Engineers ............................................................................................... 11 

Gelb, Nanci, Deputy Director, Office of Ground Water and Drinking Water, 

Office of Water, United States Environmental Protection Agency .................. 11 

Gritzuk, Michael, Director, Pima County Regional Wastewater Reclamation 

Department ........................................................................................................... 11 

Hanger, Secretary John, Pennsylvania Department of Environmental Protection ........................................................................................................................ 11

Nunley, Mayor L. Ray, City of Ruidoso, Ruidoso, New Mexico ........................... 11 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Carnahan, Hon. Russ, of Missouri ......................................................................... 84 

Johnson, Hon. Eddie Bernice, of Texas .................................................................. 85 

Mitchell, Hon. Harry E., of Arizona ....................................................................... 92 

Oberstar, Hon. James L., of Minnesota ................................................................. 93 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Darcy, Hon. Jo-Ellen ............................................................................................... 99 

Gelb, Nanci ............................................................................................................... 105 

Gritzuk, Michael ...................................................................................................... 117 

Hanger, Secretary John .......................................................................................... 121 

Nunley, Mayor L. Ray ............................................................................................. 126 

SUBMISSIONS FOR THE RECORD 

Darcy, Hon. Jo-Ellen, Assistant Secretary of the Army for Civil Works, U.S. 

Corps of Engineers: ..............................................................................................

Response to question from Hon. Oberstar, a Representative in Congress 

from the State of Minnesota ..................................................................... 46 

Response to question from Hon. Boozman, a Representative in Congress from the State of Arkansas ............................................................. 82 

Edwards, Hon. Donna F., a Representative in Congress from the State of 

Maryland, letter on the revised guidance for the State Revolving Fund 

‘‘Green Reserve’’, Peter S. Silva, Assistant Administrator for the Office 

of Water, U.S. Environmental Protection Agency ............................................. 24 

Committee on Transportation and Infrastructure, Majority Staff: .....................

Report entitled: ‘‘The American Recovery and Reinvestment Act of 2009 

Transportation and Infrastructure Provisions Implementation Status 

as of October 16, 2009’’ ............................................................................. xiii 

Chart entitled: ‘‘T&I Committee Transparency and Accountability Information by State and Formula Funding under the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by T&I Committee (Data Reported as of September 30, 2009’’ ....................................................................................... lx 

Chart entitled: ‘‘T&I Committee Transparency and Accountability Information by State under the American Recovery and Reinvestment 

Act of 2009 (P.L. 111-5) (Recovery Act) Submissions by T&I Committee (Data Reported as of September 30, 2009) Percentage of Allocated Funds Associated with Project Stages Clean Water State Revolving Fund,’’ chart .................................................................................. lxvii 

Oberstar, Hon. James L., a Representative in Congress from the State of 

Minnesota: ............................................................................................................

Page

VI 

Oberstar, Hon. James L., a Representative in Congress from the State of 

Minnesota—Continued 

Letter, Associated General Contractors of America ................................... 50 

Letter, Water and Wastewater Equipment Manufacturers Association, 

Inc. .............................................................................................................. 58 

Letter, American Iron and Steel Institute, the Committee on Pipe and 

Tube Imports, Municipal Castings Association, Special Steel Industry 

of North America, and the Steel Manufacturers Association ................ 61 

ADDITIONS TO THE RECORD 

International Boundary and Water Commission United States and Mexico, 

C.W. ‘‘Bill’’ Ruth, United States Commissioner, written testimony ................ 130 

National Resources Conservation Service, U.S. Department of Agriculture, 

Dave White, Chief, written testimony ................................................................ 132 

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(1) 

PROGRESS REPORT ON WATER RESOURCES 

INFRASTRUCTURE INVESTMENT 

Wednesday, November 4, 2009 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON WATER RESOURCES AND

ENVIRONMENT, COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, Washington, DC. 

The Subcommittee met, pursuant to call, at 10:00 a.m., in Room 

2167, Rayburn House Office Building, Hon. Eddie Bernice Johnson 

[Chairwoman of the Subcommittee] presiding. 

Ms. JOHNSON. Good morning. The Committee will come to order. 

Today’s hearing will focus on implementing the American Recovery 

and Reinvestment Act of 2009. More specifically, we will review 

how water-related infrastructure investments have already succeeded in placing workers back on the job all across the Nation. We 

will also emphasize how Federal agencies, States and their local 

partners can do more to ensure that these funds are used quickly, 

efficiently, and in harmony with the job-creating purposes of the 

Recovery Act. 

Successful implementation of this legislation is essential to our 

collective efforts to turn our economy around and create good, wellpaying jobs in America. 

Today, we will hear from Federal, State and local officials 

charged with the implementation of the Recovery Act programs 

that utilize water infrastructure-related funding. I am particularly 

pleased that we will be hearing today from the newly confirmed assistant Secretary of the Army for Civil Works, Ms. Jo-Ellen Darcy. 

Ms. Darcy has a long history of working with this Committee as 

well as a staffer on both the Senate Finance Committee and Senate 

Environment and Public Works Committee. She also is integral to 

efforts by the other body to move several water resources development acts through the process over the years. 

Let me congratulate you for your confirmation and look forward 

to working with you. I am happy to report today that the $4 billion provided by the 

Recovery Act for clean water State revolving fund programs, the 

Environmental Protection Agency has awarded $3.98 billion in capitalization grants to States. This represents nearly 100 percent of 

the total available funds. These important funds are allocated to 

individual States to construct, rehabilitate and modernize our Nation’s wastewater infrastructure. And further, I would like also to 

report that as of September 30, 2009, a total of 873 clean water 

State revolving fund projects in 43 States have been put out to bid, 

2 

totaling $1.8 billion. That is 48 percent of the total available funds 

for clean State revolving fund projects. 

Of these 873 projects that have been put out to bid, 530 clean 

water fund projects in 40 States are already under contract. Work 

has begun on 394 projects in 36 States totaling $872 million. Monitoring the amount associated with projects out to bid, under contract, and underway helps us measure the Recovery Act’s progress. 

Unfortunately, critics of the Recovery Act focus exclusively on the 

amount of outlays of Federal funds. This approach does not provide 

a good sense of Recovery Act progress because infrastructure 

projects primarily operate on a reimbursement mode. 

For instance, States seek reimbursement for wastewater infrastructure projects only after construction is underway. Since Federal outlays may come months after jobs are actually created and 

construction has begun, outlays are a lagging indicator of Recovery 

Act progress. 

While the numbers are promising, I encourage EPA to continue 

to take a greater role in facilitating further expenditures of clean 

water State revolving funds by individual States. I also would like 

to hear about the steps EPA and individual States are taking to 

ensure that all States meet the February 17, 2010 deadline for 

awarding contracts or proceeding to construction on their clean 

water State revolving fund projects. EPA has achieved greater success at implementing the Superfund program and comprehensive 

initiative to clean up the Nation’s hazardous waste sites, of the 

$600 million provided for the Superfund program, EPA has provided $573 million to existing contracts for 56 projects in 28 States. 

That is 98 percent of the total funds for the Superfund cleanup. And finally, the $100 million provided for the Brownfields program EPA has awarded grants, or provided funds for existing 

grants or contracts worth $79 million for 176 Brownfields projects 

in 39 States. This represents 79 percent of the total funds for 

Brownfields. 

The Recovery Act also provided $4.6 billion to the Corps of Engineers. As of September 30, 2009, the Corps has begun work on 731 

Recovery Act projects all across the country totaling over $2.2 billion. This represents nearly 50 percent of the total amount of funds 

allocated to the Corps. My assumption is that all of the Members 

of this Committee want the Recovery Act to succeed. Every Member of this Committee should want the infrastructure investment 

made by this Act to improve the economy, to help create and sustain good-paying jobs and to begin the long-forgotten need to invest 

in our Nation’s infrastructure. 

I see hopeful signs in today’s testimony, but I remind all of our 

witnesses that more must be done to ensure these funds have their 

intended effect. I now yield to my Ranking Member, Mr. Boozman, 

for any statement he might have. 

Mr. BOOZMAN. Thank you, Madam Chair, for holding this very 

important hearing. Whether you voted for the American Recovery 

and Reinvestment Act or opposed the legislation, we in Congress 

have the responsibility to ensure the money is spent for its intended purposes. 

Some of the stimulus expenditures are of concern. For instance, 

the administration has sent more than $2.5 million in stimulus 

3 

checks to the deceased, spent $1 million to build bike lockers and 

a bike garage in Portland Oregon, and 1.3 million in Maine for basket makers, storytellers and a music festival and spent more than 

$9 million to restore an abandoned train depot in Lancaster, Pennsylvania. 

Some might try to rationalize these expenditures, but it is hard 

to see how they can be as beneficial as investment in harbor maintenance, locks and dams, levee repairs and wastewater treatment 

plants. While some have credited the stimulus package for the 3.5 

percent grown in GDP for the last quarter, for many families in 

America, the recession is far from over as unemployment continues 

to rise. The national conference on State Legislatures recently reported that 27 States are forecasting shortfalls for fiscal 2011, the 

total at least $61 billion with five more States predicting unspecified budget shortages. 

Given the fact that the transportation projects and other infrastructure projects like flood damage reduction projects, wastewater 

treatment projects provide economic benefits to the Nation, the administration and the Congress should have placed a higher interest 

in the work of the Army Corps of Engineers’ and EPA’s clean water 

State revolving loan fund and Brownfields programs. All these 

projects put people to work which is another reason to put these 

investments high on the priority list. 

Since the stimulus bill shortchanged infrastructure investment, 

we have to conduct rigorous oversight on the allocation of these 

scarce resources and make sure that taxpayers’ moneys are spent 

wisely. And I commend Chairman Oberstar, the Chairman of this 

Committee, again for having an important hearing such as this so 

that we can do that. 

On a very positive note, I want to thank the Corps for working 

in a way I think that has really been exemplary. We had a situation that the Corps and the USDA needed to get together and expedite some things, and I think that is the kind of model that we desperately need. Those kind of things, as we seek to work together, 

the different agencies, cut through the red tape so that we can get 

these projects moving is so important. 

And I am very familiar with the specific situation where again 

the Little Rock Corps, the Corps has acted very, very well, USDA 

has done a tremendous job. So those are the kind of things that I 

think we are looking for. So with that I yield back the balance of 

my time. Thank you, Madam Chair. 

Ms. JOHNSON. Thank you very much. The Chair will now recognize Mr. Teague. Mr. Teague was instrumental in getting his 

mayor here today. So, he will probably have some words about him 

as well. 

Mr. TEAGUE. Thank you very much, Madam Chairwoman, for 

holding this meeting and you know bringing to light the good 

things that have come from this bill and everything, and I appreciate the recognition, and I am also very proud today to welcome 

my friend and my fellow New Mexico elected official and my constituent, Mayor Ray Numbly of Druids to the House Transportation 

and Infrastructure Committee to testify about the impact that 

wastewater infrastructure funds and the American Recovery and 

Reinvestment Act have had in my district. 

4 

I ran for Congress not to be a voice at one of the political extremes, but to be a can-do worker, problem solver and representative for the communities in my district. Well, as soon as I was 

elected, Mayor Nunley came to me with a problem that needed 

solving. His town, Ruidoso, had been ordered to complete a wastewater project that would cost $36 million. And that might not seem 

so extraordinary to many of my colleagues who represent larger 

population centers, but Ruidoso has a population of approximately 

10,000 permanent residents. How are 10,000 people, along with the 

residents of Ruidoso Downs supposed to finance a $36 million 

wastewater project? The answer, in this case, is to work in concert 

with the Federal and State officials to take full advantage of the 

American Recovery and Reinvestment Act. Earlier this year, the Ruidoso project received $6.6 million in 

ARRA funds which the mayor and his colleagues pooled with local, 

State and other Federal money to get the project off the ground. 

There are men and women in hard hats building that facility as 

we speak. It is one of six ARRA wastewater projects that we hope 

to see in my district. Mayor Nunley represents the kind of responsible, can do, small town local officials we have many of in my district. I am proud to be here with him today and look forward to 

his testimony. 

Thank you. And I yield back. 

Ms. JOHNSON. The Chair now recognizes Mr. Cao. 

Mr. CAO. Once again, on behalf of my constituents in Orleans 

and Justin parishes, I would like to extend my thanks to the Chairwoman and also to the Ranking Member for holding this important 

hearing today. My district is still contending with the aftermath of 

Hurricane Katrina, especially in regards to the issue of storm protection. As you know, my district has been waiting for almost 4 

years for the Army Corps of Engineers to install storm protection 

mechanism as mandated by Congress. 

In June of 2006, temporary hydraulic pumps with gates were 

constructed at Lake Pontchartrain. Critics say these are not the 

most reliable options and would question their ability to pump and 

protect the city. Others say we can do an adequate enough job over 

the next 3 to 5 years. In June, 2007, I-walls were replaced at the 

points of breach after Katrina, the 17th Street, Orleans Avenue 

and the London Avenue canals. 

On June 15, 2006, congressional funding for 100-year-storm protection was signed into law with the Emergency Supplemental Appropriations Act For Defense, the global war on terror and the Hurricane Recovery of 2006. Specifically, Congress appropriated $804 

million for the Army Corps of Engineers to build pumping stations 

at the 17th Street Orleans Avenue and London Avenue canals. Additionally, supplemental spending were authorized and funded fortifications of existing, internal pumping stations systems city wide. 

Under this authorization, the Corps studied three options for delivering this increased storm protection, options 1, 2 and 2(a). 

Option 1 would create a pump at Lake Pontchartrain and no 

other engineering or buildout of walls. Option 2 would build a new 

pump at Lake Pontchartrain deepening and widening the canals 

and thickening out the internal pumping stations. This pump 

would have to lift water up extra 5 feet from the outfall canal due 

5 

to it being widened and deepened. The pump specifications would 

require more horsepower and would provide pumping capacity of 

12,500 cubic feet per second. Option 2(a) would be the same as option 2 with an additional pumping station to pump areas of Old 

Metairie to the Mississippi River. 

I know that this is a contentious issue between the Army Corps 

of Engineers and the State of Louisiana. I hope that through this 

hearing as well as through my questioning, we can address some 

of the issues that I am concerned with; one, the controversy between option 1, options 2 and 2(a), as well as some of the delays 

that I have seen in regard to with the Army Corps of Engineers 

and some of the other issues that would I like for the panel to discuss in connection with hurricane protection as well as other 

projects that are water related. 

So again, I would like to thank the Chairwoman and the Ranking Member for holding this hearing, and I hope that the Recovery 

Act money will be implemented in a way that will provide greater 

protection for my people in the Second District of Louisiana. So 

thank you very much. 

Ms. JOHNSON. Thank you very much. The Chair will now recognize the distinguished Chair of the Full Committee, Mr. Oberstar. 

Mr. OBERSTAR. Thank you, Madam Chair, for holding this hearing, and Mr. Boozman for continuing on the commitment that I 

made and my colleagues on our side made at the outset of the year 

in supporting and advancing the stimulus as we did through programs under the jurisdiction of our Committee. 

We have held, as promised, hearings starting 60 days from signing into law every 30 days hearing on the progress made by the 

various agencies and the State administrators of programs such as 

DOT, metropolitan planning organization, State revolving loan 

funds and aviation authorities, and I can say that we have a very 

good track record to point to. I keep a report card in my pocket. 

Any time anybody asks me, I have it right here, it is 30 days behind time right now, but we are updating that. February 17 seems 

like 2 years ago, but it was February 17 the President signed the 

bill into law. 

Thirteen days later, State DOTs are notified of their formula 

funding allocations. Federal Highway Administration on that very 

day approved its very first project out here in the Maryland suburb 

of Silver Spring. Sixteen days later, State DOTs, cities and public 

transit agencies were notified of their transit formula funding allocations. And 27 days after signing, the first transit project was approved in rural Kentucky and the second in Missouri. 

Since then, we have 6,700 highway and transit projects on which 

work is underway, under contract, on the job, people working, 

165,496 direct jobs that are accounted for, that have been paid $6.5 

billion in payroll. Those are workers getting a paycheck not an unemployment check. They have paid so far $900 million in Federal 

taxes alone. So they are not tax eaters, they are taxpayers. They 

are not unemployment check recipients, they are payroll check recipients. 

In addition to those 165,496 direct jobs, there are another 

125,000 jobs in the supply chain, in the sand and gravel pits, that 

are supplying aggregate to the contractors, the cement plants that 

6 

are supplying cement for ready mix facilities and asphalt suppliers 

to the asphalt cement sector and rebar for reinforcing rods in the 

concrete highway work being done. 

In fencing, in fence posts, in guard rails, in I beams for the 

bridges, all of that is supply chain jobs being produced in this country at the steel mills. In my district alone, let’s say a tertiary effect 

is that when the steel mills go back into operation and begin producing steel, they need iron ore to make the steel. So the iron ore 

mines in my district, which have been shut down since summer of 

2008, have called people back to work, have called all but one mining operation. 

And that has meant in addition railroad jobs to haul the iron ore 

from the mines to the Port of Duluth-Superior and that, in turn, 

means every shipload that goes out is 21 additional mariner jobs 

who were laid off since last summer. 

So we have, I think, a very, very positive story to tell: 67 percent 

of the total funding is out to bid, as the charts show; 33 percent 

is committed to contracts, 11-1/2 billion, not yet out to bid, but 

under the provisions of the Act, still within the timeframe. 

The numbers don’t show up in the waste, in the subject of today’s 

hearing, the numbers don’t show up as quickly because States do 

not seek reimbursement until, for their clean water State revolving 

loan fund projects until after construction is underway, similar for 

the highway program. It is a reimbursement program. States, State 

DOTs advertise for bids, award bids, they have a time delay for bid 

contests, there haven’t been any that I know of, and then they 

award the contract, work gets underway. 

The contractor bills the State. The State then submits its voucher to the Federal Government. The same with the State revolving 

loan fund. Projects out to bid, under contract, underway those are 

the better measurements of progress. 

In our State of Minnesota, where the State public facilities authority under the direction of Terry Coleman and Jeff Freeman, 

who have been doing this work for 25 years, they took their $73 

million in wastewater treatment funds and additional monies in 

the drinking water funds and leveraged it into a $502 million program. They have virtually every project under contract, and I have 

looked at the list, they are small towns, 2,500 under population 

who only had primary treatment, settling ponds that are 40 or 50 

years old in some cases. 

In one case, a city didn’t have any sewer system at all. All they 

had were mound systems and septic tanks leaking into groundwater. They are not getting sewer, sewage treatment plant, cleaning up the groundwater, cleaning up the surface water, huge benefits for future generations. 

So, of the roughly $4 billion for the SRF program, total of 873 

clean water projects in 43 States have been out to bid for a total 

of $1.8 billion. And that is 48 percent. 

Now there was a delay and I was unhappy with this getting underway because of the Buy America provision. And I am happy to 

report, I have had some conversations, some of you may have had 

with our members of the Canadian Parliament, the minister of 

trade for Canada came in, the prime minister was here for a visit, 

and I said [speaking French]. 

7 

I said we are one country in North America, we are a single 

economy, but we have different systems. And those issues have 

now been to resolved. The result has been that new American manufacturers have taken hold. There is a process of treating waste 

with ultraviolet lighting, they said oh, we don’t have such systems. 

And do you know what? Within 30 days, there was an American 

company that perfected the process, got up and running. They are 

operating and they are making the equipment. And those are additional jobs created by stimulus by the Buy America provision. 

Pushed American ingenuity rises to the challenge. 

And, we have seen the—just in summary—and I also want to say 

that the bids are coming in lower, 25 percent lower on highway and 

transit projects and on wastewater treatment prices so that Minnesota’s $500 million may reach to $600 million and the same with 

other States. 

We have overall, in the GSA, the aviation projects, most of which 

are that is 100 percent of the aviation funds are under contract and 

about half of those have been completed already because airport 

authorities can move faster, those of you, Mayor, I am sure you 

would welcome such an opportunity, they can advertise for bids, 

take the bids, award the bids and hold the contract for up to a 

year, while all of a sudden the money appeared like manna in the 

desert for the Israelites in the Old Testament. 

And now they have got the money and they awarded the contract 

and work was underway and completed. Completed. And they go 

on to the next project. So aviation funds have been very expeditiously committed, total, 13,313 transportation, nontransportation, 

projects, $42.5 billion, 66 percent, over two-thirds of all the money 

is under contract, underway, jobs, and as I said earlier, they are 

not only working, $6.5 billion in payroll has been paid out, but 

those workers have paid $900 million in Federal taxes so far. 

Not only are they not drawing an unemployment check, they are 

getting a payroll check and they are paying taxes on it and they 

are contributing, and they are buying. 

I tell a touching story of Joyce Fisk, a truck driver for a contractor in Minnesota, working on Interstate 35, in the southern end 

of my district. I went up to the job site. The foreman called the 

truck over. It was one of the great big belly dumpers. And Joyce 

was driving that truck. She jumped out, she said ′′Oh, you’re Jim 

Oberstar, oh.′′ She gave me a big hug and said ′′Thank you, I am 

back at work. Six weeks ago, my husband and I were sitting across 

the dinner table looking at each other, where do we go now? Our 

unemployment checks are gone. Our health insurance ran out in 

December. Thankfully we haven’t had an illness in the family. We 

have got 2 months savings to pay the mortgage for the next 2 

months. What are we going to do with the boys? We have two 

boys.′′ They usually send them to summer camp. 

We hugged each other, cried, and just sat there. And the next 

day, Knife River construction called and said report for work next 

Monday. We won a stimulus bid. And now, she said, if I can get 

1,200 hours on the job, I will have my health insurance restored. 

My husband will have his restored. We are paying the mortgage 

out of our earnings. And yes the boys went to summer camp. 

8 

There are thousands of these human interest stories all over 

America. Putting people back to work. And while I have been patient with some of the slowness of getting started, some of the difficulty that States have had, not the Federal, Federal funds all 

went out. States have dragged their feet on it. We have had a report card, and we have reported on those States, and we have 

called them to account. And within 30 days they turned around. 

They got projects out to bid and on the job. That is the way this 

program is supposed to work. 

I called the county engineers in my district together and I said, 

I expect you to get this program working. All of you have a job. You 

have got a payroll. There are 30,000 construction workers in Minnesota who don’t. Your job is to put them to work. By damn, they 

got the message and they are doing it. And we are going to stay 

on this all the way through this program. That is the purpose of 

this hearing. 

And Mr. Cao, I understand your frustration. But those are 100 

percent Federal funds. They should be put out, they have been 

awarded under the disaster relief program, those projects, Lake 

Pontchartrain and the pumps and all the rest that you’re talking 

about that is vital, there is no reason that work shouldn’t be underway and we will work with you to make sure that that happens. 

I thank my colleagues for their indulgence for my enthusiasm 

this morning. 

Ms. JOHNSON. Thank you very much. The Chair recognizes, Mr. 

Brown. 

Dr. Ehlers. 

Mr. EHLERS. Thank you, Madam Chair. Just a quick question, I 

know this is not appropriate during an opening statement but I am 

very concerned about how much of the money is going to the Great 

Lakes and I hope you will cover that issue from both standpoints 

obviously. One concern, the Corps of Engineers project, is the polesized log which we have authorized, close to a decade ago in this 

Committee, and I understand that still not, no action is being 

taken out of the funds that have made been made available to start 

getting construction on that job. Michigan has the highest unemployment rate of any State of the Nation. I would think that it 

would be a high priority to steer money to Michigan. And there isa 

golden opportunity, a project waiting to go as far as I know. And 

I would hope the Corps would get to ball in that point and take 

action soon. 

Also, the Great Lakes issue has continued to affect a lot of people. And, I know we have some visitors here from Arizona and New 

Mexico who would love to have part of the Great Lakes, and would 

love to have the problems we are having. But clearly, the pollution 

problems that are there have to be addressed. And I would hope 

that some of the stimulus money is going there as well. 

And so, I hope the EPA, I know you have allocated additional 

funds for the Great Lakes, but I hope they accomplish two things, 

one is to improve the environment, and the other is to put people 

back to work, which is sorely needed in our State. 

So, since I probably won’t be able to stay long enough to ask you 

those questions, I, at least, wanted to make those points. And if 

9 

you wish to respond in writing, I would very much appreciate it. 

Thank you very much, and I yield back. 

Ms. JOHNSON. The Chair recognizes, Mr. Hare. 

Mr. HARE. Thank you, Madam Chair. I want to thank you and 

Ranking Member Boozman for holding this important briefing 

today, and I want to commend you for the sense of duty you have 

in leading this Committee in effective oversight of the implementation of this landmark legislation, the American Recovery and Reinvestment Act, and its funding of crucial water resources and infrastructure projects. As we all know, the current economic slowdown 

has caused the loss of many jobs and the downturn of many sectors. These factors and others have caused many economists to call 

the current situation the worst since the Great Depression. 

While we are still battling the causes and effects of the slowdown, the American Recovery and Reinvestment Act of 2009 has 

provided crucial funds to strengthen the infrastructure and workforce of this Nation. Included in the Recovery Act is $13.5 billion 

for existing Federal programs that invest in water infrastructure 

programs or provide assistance to States for such projects. 

Five Federal agencies and one commission have been provided 

with funds from the Recovery Act for water resources and infrastructure projects. U.S. Army Corps has received $4.6 billion, the 

Bureau of Reclamation $1 billion, U.S. Department of Agriculture, 

natural resource conservation service, agricultural watershed program has received $340 million, and $220 million has been allocated for the Department of State’s international and water boundary commissions levee and damn upgrades. 

As I speak, these Recovery Acts are delivering infrastructure improvements that are creating jobs and strengthening this economy. 

I am proud to say that my home State of Illinois is currently benefiting from the numerous Recovery Act investments. As of late August of this year, the State has been allocated $179 million from 

clean water State revolving fund, $79.5 million from the drinking 

water revolving fund, and these Recovery Act funds are improving 

the water infrastructure and resources of the 17th District of Illinois and will continue to invest even more in the economic development of west central Illinois and across this country. 

It is now upon the Subcommittee to ensure that these crucial Recovery Act funds are being used effectively. I look forward to hearing from our witnesses this morning. I would like to again thank 

Chairman Oberstar, our Chair and Ranking Member Boozman for 

holding this important and educational hearing. I look forward to 

our testimony. Thank you very much, Madam Chair, and I yield 

back. 

Ms. JOHNSON. Thank you very much. Mr. Hall. 

Mr. HALL. Thank you, Madam Chair and Chairman Oberstar for 

being here as well, and the Ranking Member for holding this hearing. Thanks to all of our witnesses on this distinguished panel 

today. 

And before I say anything else, I must say as a representative 

from New York, we don’t have a witness from New York here, so 

perhaps Director Gritzuk from Arizona could help explain to our 

State authorities in New York how—I am sorry, in Arizona, how 

Arizona could have 88.8 percent of their clean water projects out 

10 

to bid, whereas we in New York at this point only had 17.3 percent 

of these projects out to bid. 

This project, the stimulus dollars, the bill itself, and especially 

the clean water revolving loan fund, was intended to create jobs as 

well as to clean up our water. And this is not a time to take your 

time with contracting processes. We should get these jobs started. 

I have seen in the last year the requests to my offices in the district go to well more than the majority water requests from the 43 

municipalities I represent, either problems with wastewater facilities or drinking water facilities and drinking water quality. 

I am also concerned that we see a more robust investment in renewable sources of energy that do not emit CO2 and that increase 

our energy efficiency, an issue I pursued since coming to Congress. 

When we passed the Recovery Act last winter, I was pleased to 

see the green reserve as part of the clean water and safe drinking 

water State revolving loan funds. The eligible activities under this 

section include allowing water utilities and local governments to invest in energy efficiency upgrades. I am pleased that in my district, 

the city of Beacon, will use recovery funds to install 400 noise logging leak detectors along 60 miles of distribution mains saving energy and water. These will help the city to identify and reduce 

their losses of water and save the energy that is required to run 

pumps. 

In Duchess County, the county will use Recovery Act funds to redirect storm water to bioretention and filtration areas from interior 

roads and parking lots that would otherwise just run off into storm 

drains and cause flash flooding, which we have experienced more 

and more of in recent years. 

At the Beakman and east Fishkill town halls, projects like this 

are being done to reduce storm water impacts to the Fishkill Creek, 

which is flooded. By the way, the Corps of Engineers is doing a 

study on that and the other creeks in Duchess County to see what 

can be done to prevent these small but quick rain events resulting 

in flash floods. So I am curious as to how many of the projects are 

that funded under the SRF Green reserve were directly related to 

energy efficiency as well as water efficiency and how those projects 

benefit clean water and increase the safety of our drinking water 

in the communities I represent. 

I look forward to your testimony, and especially look forward to 

hearing from Arizona as the Number 3 State as how they could instruct New York, which is ranked number 36 in terms of the speed 

with which we have gotten these funds out, put people to work and 

started to fix our drinking water problems. I yield back. 

Ms. JOHNSON. Thank you very much. We will now go to our witnesses. We have one panel, the Honorable Jo-Ellen Darcy, assistant 

secretary of the Army for Civil Works, U.S. Corps of Engineers of 

Washington, Ms. Nanci Gelb, deputy director, Office of Ground 

Water and Drinking Water, Office of Water, U.S. Environmental 

Protection Agency, Washington, Secretary John Hanger, Pennsylvania Department of Environmental Protection, Harrisburg, Pennsylvania; Mayor L. Ray Nunley, City of Ruidoso, Ruidoso, New 

Mexico, and Mr. Michael Gritzuk, director of the Pima County Regional Wastewater Reclamation Department, Tucson, Arizona. 

11 

TESTIMONY OF HON. JO-ELLEN DARCY, ASSISTANT SECRETARY OF THE ARMY FOR CIVIL WORKS, U.S. CORPS OF 

ENGINEERS; NANCI GELB, DEPUTY DIRECTOR, OFFICE OF 

GROUND WATER AND DRINKING WATER, OFFICE OF WATER, 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY; 

SECRETARY JOHN HANGER, PENNSYLVANIA DEPARTMENT 

OF ENVIRONMENTAL PROTECTION; MAYOR L. RAY NUNLEY, 

CITY OF RUIDOSO, RUIDOSO, NEW MEXICO; AND MICHAEL 

GRITZUK, DIRECTOR, PIMA COUNTY REGIONAL WASTEWATER RECLAMATION DEPARTMENT 

Ms. JOHNSON. You will be recognized in the order which your 

names were called. And I now recognize Secretary Darcy. 

Ms. DARCY. Thank you, Madam Chairwoman, Ranking Member 

Boozman, Chairman Oberstar and distinguished Members of the 

Subcommittee. I am Jo-Ellen Darcy, the Assistant Secretary of the 

Army for Civil Works. Thank you for the opportunity to testify before the Subcommittee today to discuss the implementation of the 

civil works appropriations in the Recovery Act. I will summarize 

my statement here and ask that my full statement be entered into 

the record. 

The Recovery Act provides funds to meet the intent of the President and Congress to quickly put our fellow citizens to work and 

to help in the recovery of the Nation’s economy. Using Recovery Act 

funds to carry out work on Corps of Engineers civil works projects 

already has begun to contribute to the Nation’s economy, environment, safety and the quality of life. The Recovery Act provides 

funding to the Corps to accomplish these goals through the development and restoration of the Nation’s water and related resources. 

There is also funding to support permitting activities for protection 

of the Nation’s regulated waters and wetlands and cleanup of sites 

contaminated as a result of the Nation’s early efforts to develop 

atomic weapons. 

Total Recovery Act funding of $4.6 billion for civil works is provided in six accounts. We have $2.075 billion for our Operation and 

Maintenance account, $2 billion in the Construction account, $375 

million in the Mississippi River and Tributaries account, $25 million in the Investigations account, $25 million in our Regulatory account and $100 million in the Formerly Utilized Sites Remedial Action Program. 

The Corps is following the Recovery Act’s general principle to 

manage and expend funds to achieve the Act’s stated purposes, including commencing expenditures and activities as quickly as possible consistent with prudent management and consistent with the 

President’s direction to agencies to ensure that Recovery Act funds 

are spent responsibly and transparently and that projects are selected on merit-based principles. 

Nearly all of the $4.6 billion appropriated for civil works has 

been identified for specific civil works projects and activities. As of 

October 30, 2009, and this number I am going to give you, is updated from my submitted testimony because that was the September 30th number, but this is the October 30th number, the financial obligations total $2.38 billion which is nearly 52 percent of 

Recovery Act funds available. As of that same date, outlays had 

risen to $428 million. 

12 

There are 731 civil works projects with Recovery Act funded 

work underway across 49 States and in Puerto Rico and here in 

Washington, DC. 

Eight recovery projects have been completed to date, including 

the navigation channel for the Oakland Harbor Deepening Project 

in California. 

Under the environmental infrastructure program, 50 project 

partnership agreements have been executed around the country for 

projects with a total Federal cost of $66.3 million. Seventy-five percent of all Recovery Act contract actions have been awarded to 

small businesses. Of the $2 billion in contracts awarded, 48 percent 

of the total dollar value was awarded to small businesses. 

In addition, larger companies receiving civil works contracts are 

encouraged to hire local small business as subcontractors. 

In addition to selecting civil works projects that will produce 

long-term benefits to receive Recovery Act funding, projects were 

selected in part to maximize private sector employment impacts by 

achieving most work through contracts and by awarding the contracts in a short period of time. 

In the Civil Works program where the Corps contracts directly 

with private firms, the stimulus effects begin with the contract 

award. This is when the contractor begins to hire workers, order 

materials and equipment and take other steps to complete the 

work creating ripples through the economy. As a result, stimulus 

impacts on the Civil Works program are more closely related to obligation of Recovery Act funds primarily through contract awards 

rather than through the subsequent outlays which provide payments to contractors only for work they already have completed or 

for supplies and equipment they already have purchased. 

Overall, the investment of civil works Recovery Act funds will directly support approximately 50,000 jobs, although job impacts 

vary depending on the type of work. In addition to the direct jobs 

supports, these investments will support numerous indirect jobs in 

industries supplying material and equipment. 

Finally, additional jobs will be supported as the direct and indirect income from Corps contracts generates increased consumer 

spending. 

Just recently I spoke at the opening of a Recovery Act funded 

project, the Corps’ first veterans curation project laboratory in Augusta, Georgia. The Augusta site is the first of three veterans 

curation project laboratories that the Corps will open with $3.5 million in Recovery Act funding. The labs are an innovative approach 

to supporting returning and disabled veterans of all branches of the 

military service with jobs and training in a variety of technical 

skills. At the same time, the labs will advance the curation of archeological and historic properties that have come into the Corps’ 

possession over the years as a result of construction at its water 

project sites around the country. Veterans working at the three 

labs will be trained in computer, photographic and scanning technologies that will be applied to the rehabilitation of Corps archeological collections and their associated records. The technical skills 

learned at the labs also will be transferable to potential future jobs 

outside the labs, improving job opportunities for the veterans who 

work in these labs. 

13 

I thank you, Madam Chairwoman, and Members of the Subcommittee for the opportunity to testify, and I would be happy to 

answer any of your questions. 

Ms. JOHNSON. Ms. Gelb. 

Ms. GELB. Chairman Johnson, Ranking Member Boozman, 

Chairman Oberstar and distinguished Members of the Subcommittee, thank you for the opportunity to appear before you 

today to discuss the progress and accomplishments that the U.S. 

Environmental Protection Agency has made in the implementation 

of the American Recovery and Reinvestment Act of 2009. 

I am here today instead of Craig Hooks EPA’s senior accountable 

official for ARRA, who is home with the flu. My name is Nanci 

Gelb, and I am EPA’s Office of Water, and I have served as the 

senior official for the Recovery Act overseeing the $6 billion provided to water infrastructure programs. The Recovery Act provided $7.22 billion for specific programs administered by EPA, the clean water State revolving fund, the 

drinking water State revolving fund, Superfund, Brownfields, underground storage tanks and the clean diesel programs. The majority of these funds totaling $4.7 billion are specified for programs 

under the jurisdiction of this Subcommittee, the clean water State 

revolving fund, Superfund and Brownfields. 

Since Mr. Hooks appeared at the Full Committee hearing in 

July, EPA has made progress and has had significant accomplishments in its implementation of the Recovery Act in distributing 

funding and in providing support and assistance to recipients working on Recovery Act funded projects. 

As you will see in the written testimony, we have several success stories to tell. We have obligated more than $7 billion over 99 percent of the $7.22 billion made available to EPA thus far, and many 

projects are well underway. As the Agency senior accountable official Mr. Hooks is responsible for meeting the Recovery Act’s requirements for oversight, results and unprecedented transparency. 

And in this role, he leads a stimulus steering committee comprised 

of senior managers from across the agency to monitor Recovery Act 

implementation on a weekly basis. 

I am pleased to report that this committee has been successful 

in navigating a number of critical issues including providing guidance on Davis Bacon and Buy America requirements. 

To date, EPA has issued three national public interests and 23 

project specific Buy America waivers. We expect additional projectspecific waiver requests in the coming months and will continue to 

closely monitor implementation of the Act. 

In addition to ensuring appropriate oversight and accountability, 

EPA has been proactive in providing assistance to States in Recovery Act implementation. For example, EPA’s staff is actively involved in reviewing every State SRF program and have already visited 49 States to assess individual project status. We have also 

made EPA contractors support available to States in order to directly assist communities in need. 

Personally, Mr. Hooks and I have reached out to States to offer 

guidance and assistance in implementing the Recovery Act. Last 

month, he met with representatives from the National Governors 

Association to listen to their concerns about the challenges they 

14 

face in accomplishing the goals of the Recovery Act. He also sent 

an e-mail to Recovery Act leads in each State regarding the funding requirements associated with the drinking water and clean 

water State revolving funds and offered assistance from EPA in answering their questions or in overcoming any issues in order that 

the States are able to meet the February 17, 2010, deadline. 

I have concern about the ability of some States to meet this 

deadline. Mr. Hooks and I have placed personal calls to officials in 

several States that appear to be facing challenges in meeting the 

deadline. During those calls, we explain the process for meeting the 

requirement and listen to their concerns. 

In addition, we have provided guidance and offered additional assistance to each State. We are working diligently to assist States 

in meeting the deadline in order to avoid having to reallocate 

funds. However we know that States are working hard to meet this 

deadline. The State of Minnesota provides an excellent example of 

States’ efforts, Minnesota’s public facilities authority and pollution 

control agency have worked aggressively and today have 88 percent 

of their available clean water State revolving funds under contract 

for construction equal to over $70 million. Construction has begun 

on 18 different projects around the State. This work not only with 

provide significant improvements to Minnesota’s water infrastructure, but provides jobs for its citizens. 

Another challenge has been the requirement that States allocate 

20 percent of their SRF dollars to promote the implementation of 

green infrastructure projects. These types of projects support the 

development of a green workforce and can provide long-term benefits that exceed those associated with traditional environmental infrastructure projects. To date, 14 States have met this requirement 

totalling more than $355 million. We further expect that the rest 

of the States will meet the requirements by February 17, 2010. 

We look forward to continuing to work with this Subcommittee, 

our Federal, State and tribal partners and members of the public 

as we continue to assist our State partners and other recipients to 

fulfill the goals of the Recovery Act in an efficient and timely manner. Thank you again for inviting EPA to testify here today, and 

I look forward to answering your questions. 

Ms. JOHNSON. Thank you very much. 

Mr. Hanger. 

Mr. HANGER. Thank you. Madam Chair. I appreciate the opportunity to appear before the Committee. Pennsylvania is certainly 

being buffeted by the economic storms that started in December 

2007 and then took a turn with the worse with the Lehman bankruptcy that threatened a depression in September 15, 2008. A lot 

of people in Pennsylvania are suffering. We have lost 200,000 jobs. 

Our unemployment rate is at 8.8 percent, which is actually a full 

point below the national unemployment rate, but again, a lot of 

Pennsylvanians are hurting and suffering through no fault of their 

own. 

One Pennsylvania company, USX, an icon of the U.S. economy, 

for example, went from 100 percent of capacity in the summer of 

2008 to 40 percent of capacity by December of 2008. Again, the people who work at USX had nothing to do with that tremendous loss 

15 

of demand for their product and the thousands of people that suffered as a result. 

Pennsylvania, like virtually every State, has a substantial backlog of water and wastewater projects that need funding. Our infrastructure is aging and needs repair. And investing in water and 

sewer infrastructure creates so many wins that it is hard to count 

them all. Water and sewer investments puts people to work right 

now in manufacturing materials like concrete and steel, water and 

sewer investment requires engineering and other professional services, water and sewer investment requires construction work, and 

once completed, water and sewer investments creates facilities that 

then must be operated 24 hours a day, 7 days per week and 365 

days per year. ARRA specifically has specifically provided $220 million to Pennsylvania for drinking and wastewater infrastructure improvement 

projects that will help create more than 5,500 jobs throughout the 

Commonwealth. In addition, in July 2008, the Pennsylvania General Assembly provided $800 million for water and sewer investments and then the voters of Pennsylvania in November of 2008 

approved another referendum of $400 million for further investment. 

In combination with the ARRA funding, Pennsylvania has already awarded funding for nearly 170 projects. We started doing 

that in April of 2008. The ARRA money with the State funds is 

producing an incredible range of good outcomes in Pennsylvania; 

$38.4 million for seven projects to eliminate direct, discharges of 

raw sewerage to our streams, $34 million to eliminate 1,216 malfunctioning on-lot systems, including a community in Adams County, where a $5.1 million loan is creating a new wastewater treatment plant; $179 million for 17 projects to eliminate or reduce combined sewer overflows; $105 million for 17 projects to reduce nutrients and sediments to the Chesapeake Bay, like the $5.9 million 

grant awarded in Huntington County to install improvements to 

the wastewater treatment plan that will reduce both nitrogen and 

phosphorus. 

In addition, the ARRA required 20 percent of all funds be directed to green infrastructure projects. We have already authorized 

62 green infrastructure projects. These projects will save energy, 15 

million kilowatt hours, $1.5 million of annual savings; it will save 

water, 1.5 million gallons of water, it will save reduce pollution 1.3 

million pounds of nitrogen, 4 million pounds of phosphorus, reduce 

carbon emissions 36 million pounds of carbon emissions, it will 

plant 29 miles of forested buffers to protect our rivers and so on. 

In summary, to date, Pennsylvania has put out to bid 85.8 percent of the clean water State revolving fund, we are under contract 

61.2 percent of all funds, and we have 48.8 percent of projects underway. 

The money that Federal taxpayers have paid is precious money, 

and Governor Rendell has made it very clear that it is our responsibility to make sure that every single cent do as much good as possible as quickly as possible. And that is what we are working on 

Pennsylvania every day. We understand that this is an opportunity 

on, in fact, invest in our future and deliver to our children and 

grandchildren valuable assets and not simply a debt. This is a real 

16 

investment in the future of Pennsylvania and the future of the 

United States. 

We in Pennsylvania are very thankful to you, Madam Chairwoman, and to the Congress for making these funds available, and 

we are doing our very best to be good stewards of these funds. 

Thank you Madam Chairman. 

Ms. JOHNSON. Thank you very much. 

Mr. Nunley. 

Mr. NUNLEY. Madam Chairman, Members of the Subcommittee, 

distinguished Members of the House, thank you for inviting me 

here. I thank you for inviting me to come and be before you today. 

On behalf of the citizens of the Village Ruidoso and the city of 

Ruidoso Downs, I would like to thank you and your colleagues in 

the U.S. House for your assistance in securing approximately $6.6 

million for the American Recovery and Reinvestment Act for construction of a new wastewater treatment plant. This issue of building this facility has dominated our lives in the upper Rondell Valley for a number of years, and I would like to say that we are now 

under construction. 

The following is a short discussion of this project and the challenges that we faced dealing with the issue. The project is intended 

to replace an existing regional wastewater treatment plant with a 

new facility that meets all of the requirements of our various stringent EPA NPDES permit. This facility currently provides services 

to the village of Ruidoso, the city of Ruidoso Downs and the Mescalero Arrow Apache Indian reservation. 

Mr. NUNLEY. I currently provide services to the Village of 

Ruidoso, the City of Ruidoso Downs and the Mescalero Apache Reservation. The current wastewater treatment plant is approximately 

30 years old and has a limited capacity of .54 million gallons per 

day. The proposed new plant will have a capacity of 2.5 million gallons per day in Phase I and an ultimate processing capacity of 3.75 

million gallons per day in Phase II. Phase I is scheduled to be operational through 2015, Phase II through 2030. 

More importantly, the new plant will have a capacity to meet the 

EPA standards—very strict standards by the way—of .1 milligrams 

per liter of phosphorous and 1.0 milligrams per liter of nitrogen. 

We are not aware of any other local government, State, or Federal 

jurisdiction that has both of these standards included in its NPDES 

permit. The plant is being built to those capacities in order to meet 

the nutrient requirements of the permit, as well as it being able 

to provide sewer service to the significant number of tourists and 

part-time residents that visit during the summer months and other 

holiday times. 

As a result of two lawsuits, the village is required to finish construction by December 2010. And I would like to say that at this 

point, we are on time with our construction and we are on budget. 

Phase 1A is a sludge handling facility and was completed October 

2009. Phase 1B is a filtration part of the treatment facility and is 

also under construction. And we also will have a UV operational 

piece of equipment at the end of the plant whenever it is finished. 

The total cost of the project will be 36 million. The cost is being 

borne by a total population of approximately 10,000 permanent 

17 

residents that can increase to over 35,000 on specific holidays and 

weekends. 

In order to meet this very stringent funding requirement to build 

a facility, the village and the city need to rely on a number of funding sources. The first major funding source was obtained in a series 

of grants from both EPA and the State of New Mexico appropriations, totaling about 8.5 million from both communities. The second 

funding source has been general obligation bonds in the amount of 

12.6 million for Ruidoso and $500,000 for Ruidoso Downs. As a result, the total bonding capacity of each jurisdiction has now been 

completely utilized. 

The third funding source has been loans obtained through USDA 

in the amount of 8.7 million for Ruidoso and 1 million for Ruidoso 

Downs. The final component and most important component has 

been the $6.6 million allocated through the ARRA program. 

In order to repay these bonds and loans, the residents of the village of Ruidoso have added a wastewater fee that is dedicated to 

repayment. These fees are financially significant and represent approximately a 34 percent increase for a typical residential water 

and sewer bill. Given the general state of the economy, these additional fees are a burden to many of our residents. But we have also 

created 85 new jobs to date, going to about 150 when we are in full 

swing with the construction. 

This project included a number of issues which needed to be addressed in order for the project to be commenced. The first issue 

was completion of the actual design, the PER. The project initially 

was designed to address phosphorous only. And when we were 

about halfway complete through that engineering process, we got 

a note from EPA that we needed to also address our nitrogen 

standard. Both of these are very strict standards. 

The project included a number of issues which needed to be addressed in order for the project to be commenced. The first issue 

was completion of the actual design. The project initially was designed to address phosphorous only. And when design was—I read 

that already. I am sorry, Madam Chairman. 

Other issues included having to purchase a large portion of the 

site from the U.S. Forest Service. This action was unanticipated, 

but completed successfully within the construction time line needed 

to be in full cooperation and assistance of the Lincoln National Forest. 

While there are unforeseen problems, the project has created potential opportunities that may provide long-term solutions to water 

availability in this part of the Hondo Valley; namely, water reuse. 

In this type of program, effluent is intercepted along the main interceptor line via scalping plants. The solids are sent to the regional wastewater treatment plant and the grey water directed to 

a series of potential users and uses, including a recharge of our two 

lakes, aquifer recharge, irrigation of golf courses and other open 

spaces. This type of system will allow the village to use the same 

gallon of water multiple times versus single use that is in place 

now. 

This type of strategy also helps to minimize the impact of the 

current and any future NPDES permits by reducing the amount of 

effluent being piped into the river, the Ruidoso. Limiting outflows 

18 

of the Ruidoso will make it easier to comply with these discharge 

standards. Eliminating flow would eliminate the need for a permit 

altogether. 

We, the village of Ruidoso and the City of Ruidoso Downs, would 

like to let the membership of the House of Representatives know 

how much the residents of the valley appreciate their assistance 

and support for the funding provided by the ARRA program. We 

also want to tell the membership that the residents here appreciate 

the value of water and its conservation and that we are working 

diligently to maximize the sustainability of its value to our communities. 

If anyone has any questions, they should feel free to call me. My 

number is on here. I will stand for questions today. And without 

reading any further, I would like to say that I appreciate, Mr. 

Oberstar, your exuberance. It was very good. And I want to tell you 

how much we all appreciate you down in southern New Mexico. 

Water is a priority down there. And if I had the ability to annex 

the Potomac, I would do it. Thank you very much. 

Ms. JOHNSON. Thank you very much. 

Mr. Gritzuk. 

Mr. GRITZUK. Chairwoman Johnson, Chairman Oberstar and 

Ranking Member Boozman and Members of the Subcommittee, 

thank you for your leadership and commitment to providing increased water infrastructure funding through the American Recovery and Reinvestment Act. It is a great pleasure for me to be here 

to testify on behalf of the benefits of this program to my utility and 

to our community of the funding that Congress and the administration provided by passing ARRA. It is also my pleasure to be testifying on behalf of the National Association of Clean Water Agencies. 

I would like to begin by thanking Chairman Oberstar, Chairwoman Johnson, and the Members of the Committee and the Subcommittee for their leadership in ensuring that the stimulus bill 

contained approximately $6 billion for the State revolving loan 

funds, 4 billion for the Clean Water Revolving Fund and 2 billion 

for the Drinking Water Fund. So we thank you for that. 

As this Subcommittee know, according to the EPA, the CBO and 

GAO, the Nation’s wastewater and water infrastructure faces a 

daunting funding gap of approximately $500 billion over the next 

20 years. When discussions regarding a stimulus package started, 

NACWA performed a survey of its members, demonstrating that 

the nation’s POTWs had approximately $17 billion in shovel-ready 

projects that would stimulate the economy and, at the same time, 

improve the Nation’s environment. 

The need for funding was further underscored by the impacts to 

utilities from the most severe economic downturn since the Great 

Depression, impacts that are still resounding at my utility and utilities across the country. 

Given these challenges, funding from the ARRA that my department received has been very, very helpful to us. ARRA funding 

strongly supported our plant interconnect project, which is a key 

component of our regional optimization master plan, which primarily is a regulatory driven program. This project connects the department’s two major water reclamation facilities for optimal utiliVerDate Aug 31 2005 10:45 Jul 21, 2010 Jkt 000000 PO 00000 Frm 00086 Fmt 6633 Sfmt 6633 P:\DOCS\53286.0 KAYLA
19 

zation of treatment plant capacity and meets the wastewater needs 

or wastewater growth needs in Pima County through the year 

2030. This is no small accomplishment, taking into account the fact 

that Pima County has grown by more than 50 percent since 1990. 

Funding provided by ARRA made it possible to move forward 

more expeditiously with this project that includes constructing 5 

miles of large-diameter intercepter sewer lines between the two 

treatment facilities. The project will greatly increase operation 

flexibility and will have a significant impact on the local economy 

while improving Pima County’s wastewater infrastructure. In fact, 

the combination of the $8 million in low-interest loans and the $2 

million in principal forgiveness provided by the ARRA will result 

in savings of over $3.2 million in financing costs alone over the 15- 

year term of the loan, and will supplement an additional $33.1 million in funding that is expected to create approximately 170 to 200 

jobs. 

The additional subsidization and grant component of the stimulus bill, and grant funding more generally, constitutes sound national policy because it does not require local governments to assume new debt as part of the Federal program to stimulate the national economy. The stimulus funding is a welcome benefit in Pima 

County where we are experiencing a general unemployment rate of 

approximately 8.2 percent, an unemployment rate in the construction sector of nearly 17 percent. 

While critics might point out that our project would have been 

completed over time without stimulus funding, which is true, immediate funding contributed to the benefit of increased employment for one of the hardest-hit unemployment areas of the Nation. 

In addition, the ARRA funding is helping Pima County to put municipal dollars that it saved towards other water quality projects 

that would have otherwise been delayed, adding additional economic and environmental benefits to our communities. 

States are doing everything they can today to get the money out 

quickly. But it is critical that these efforts be guided by the goals 

of job creation and shovel readiness rather than just on their preexisting priority criteria or single indicators such as affordability 

and median household income. 

In conclusion, there is little doubt that the investments provided 

by the ARRA were a good first step in reversing the years of declining Federal investment in our Nation’s water infrastructure. Again, 

I would like to thank this Subcommittee, the Committee for its 

leadership, and look forward to any questions you may have. 

Thank you. 

Ms. JOHNSON. Thank you very much. 

We will start the first round of questions. I would like to say to 

the Members that we are looking forward to four votes coming up 

in the next 15 minutes or so. So we might want to speed up our 

questions so we won’t have to have our witnesses wait so long. 

I have a question for Ms. Gelb, as well as Secretary Hanger. According to information that has been provided to the Committee by 

the States, there is a wide range of success among States in getting 

Recovery Act funding out of the door and getting the projects underway. 

20 

In the State of Pennsylvania, for example, over 80 percent of the 

State Revolving Loan Fund projects are out for bid, and almost 50 

percent out for contract, and yet in my own State of Texas, only 

4 percent of the projects designated for the revolving fund monies 

are underway. And, similarly, in the home State of our Ranking 

Member, Mr. Boozman, I understand no projects are yet underway. 

I applaud EPA’s role in making sure that these funds move; however, I would like your opinion on why the States are having such 

a difficult time. I don’t know if it is the red tape or whatever. Your 

testimony notes that EPA has offered assistance to States to help 

get the money out of the door and States willing to utilize—are the 

States willing to utilize your assistance? 

Ms. GELB. Thank you, Madam Chair. Yes, the States have assisted in a number of ways through Webcasts, through State visits 

and a number of opportunities. What we are learning is that the 

numbers may not tell the entire story. The States are in various 

levels of progress. The numbers right now, while we are not seeing 

much success in the number, what we are learning from the individual State visits and from my personal calls to States is that 

many States are in the last months of reviewing and opening bids. 

And as soon as those bids are opened, they will be putting their 

dollars under assistance, dollars in contract. And they assure us 

that they will be able to meet the February 17th deadline. 

Mr. HANGER. Madam Chairwoman, in Pennsylvania—I really can 

only speak to Pennsylvania. I have no knowledge about what is 

going on in other States. But in Pennsylvania, we have, I think, a 

number of things that have enabled us to move the money through 

what is and should be a serious process. 

I mean, this is a lot of money, it is public money and it requires 

proper bidding processes, awarding processes and the like. But in 

Pennsylvania, we have institutions in place that have a lot of experience, moving water and wastewater projects. Every year we do, 

in a typical year, around $300 million of wastewater and water 

projects with State money. So we have an administrative infrastructure in place that is expert at moving projects. 

And certainly the stimulus money then was added to the normal 

course of business in Pennsylvania. And I think that is the main 

reason why Pennsylvania has been successful in getting a significant number of projects out to bid and under contract. 

The second reason is leadership. Governor Rendell has made it 

very, very clear that Pennsylvania State government, with the 

Clean Water State Revolving Fund, must do everything that we 

can to move this money. It is very precious money. We have a lot 

of Pennsylvanians hurting through no fault of their own. And we 

also have aging infrastructure. And this is actually a tremendous 

opportunity to put people to work in our steel and concrete industries and our construction industries and, at the same time, make 

a significant dent in the backlog of aging infrastructure and pass 

to our children, again, valuable assets that are going to continue 

to deliver tremendous public health, environmental, and economic 

benefits for decades, decades, long after this economic crisis is overcome. And we will overcome this economic crisis in part because of 

the Recovery Act. 

Ms. JOHNSON. Thank you very much. 

21 

Mr. Boozman. 

Mr. BOOZMAN. Madam Chair, I would yield—let Mr. Brown go 

ahead and proceed. 

Mr. BROWN OF SOUTH CAROLINA. I thank my friend for yielding. 

Madam Secretary Darcy, I guess my question would to be you. 

I represent the coast of South Carolina which has two ports, 

Charleston and also Georgetown. And we met with Secretary 

Woodley during the stimulus debate and we were able to get funding for the Charleston Harbor, which is a pretty viable port, but 

we weren’t able to get any money for Georgetown. And Georgetown 

is a rural—part of Beaufort County, although it—part of South 

Carolina, but it is a vital port. 

We are in a Catch-22 now. In fact, we just had a discussion with 

the port yesterday, the Governor who came down. And the headlines in the news was ′′Port Needs 8.3 Million Plus to Dredge 

Channel.′′ Governor Sanford and this port discussed funding. 

The problem we have had with Georgetown is that it is one of 

those ports that it is almost a Catch-22. We don’t have enough tonnage being shipped out to equal a million-ton requirement, I guess, 

for some of the other ports. But we are in a situation—and I would 

like to read you a quote from this article that said, ′′The shipping 

channel needs more depth to handle large cargo ships asking to 

come to Georgetown, said port director, David Schronce. The depth 

in the channel in some areas is now only 22 feet. Carolina Pacific, 

a company that makes wood chip briquettes is using smaller ships 

to get into the Georgetown until they can get the depth they need 

to grow their tonnage. Schronce said four companies have pending 

contracts to ship their products out of the Port of Georgetown, 

could mean about 4.4 million tons of cargo.′′ 

We are dealing with a community that has probably got almost 

13 percent unemployment and the port is certainly the nucleus 

that drives the economy for that community. Is there anything that 

we could do to be able to round up some funding for that port so 

that we could create those jobs that are so necessary for that community? 

Ms. DARCY. Congressman, I am not familiar with the specifics of 

your particular port, but I expect that in evaluating the projects for 

the ARRA funding, it probably did not meet the criteria that we 

had to use in order to select those. But I will look further into it 

for you. 

Mr. BROWN OF SOUTH CAROLINA. I appreciate that because I recognize we don’t have the tonnage in order to qualify for the funding. But if we don’t get to the 27 feet back again, we won’t be able 

to attract those industries that come in. And could you tell me 

whether the Corps made the decision or OMB made the decision 

not to fund that port? 

Ms. DARCY. Sir, it would have been a Corps decision, but we followed the criteria that were given administration-wide on the kinds 

of projects that would qualify under the law. 

Mr. BROWN OF SOUTH CAROLINA. I would certainly appreciate 

you looking into it, because it is like the chicken or the egg. If we 

don’t have the deep—the depth there, the ships can’t come and the 

jobs can’t be created. So I certainly appreciate you looking into that 

for us. 

22 

Mr. OBERSTAR. Would the gentleman yield? 

Mr. BROWN OF SOUTH CAROLINA. Yes, sir. 

Mr. OBERSTAR. Following up on the gentleman’s question, I 

would like to know whether this project, the channel deepening, is 

an already authorized project. Do you know that offhand? 

Ms. DARCY. I don’t. I don’t know offhand. I don’t want to tell you 

the wrong answer. 

Mr. OBERSTAR. If it is an authorized project and it is not at the 

depth authorized in current law, then it could have been eligible 

for funding under the Recovery Act. If not, it would have been considered a new start, and new starts were eliminated from consideration in the Recovery Act. The Recovery Act was to fund only those 

that had already been authorized and underway. So I will work 

with the gentleman on this issue, and with the Corps, and we will 

get to the bottom of his concern. 

Mr. BROWN OF SOUTH CAROLINA. I thank the Chairman. The 

only thing I have to support it is this article from the newspaper 

that said, if dredging is done, the shipping channel could be 

brought back to the required depth of 27 feet. So I would assume 

this has got an authorized depth of 27 feet. So I assume it would 

not be a new start. 

Thank you, sir. And thank you, ma’am, too. 

Ms. JOHNSON. Thank you very much. We might have to recess 

and return because of the number of questions. Congresswoman 

Edwards. 

Ms. EDWARDS. Thank you, Madam Chairwoman. I wasn’t certain 

I would get in. My question actually goes to Ms. Gelb, and it is actually about the green reserve. And I am curious as to whether in 

the green reserve that you are familiar with a letter that was actually sent to the EPA by a coalition of environmental groups asking 

about some of the criteria around the use of the funding and selection and prioritization of the projects. 

So I wonder if you could tell me whether you have some thoughts 

about the criteria for ranking green-reserve projects and the financing of stand-alone green projects, because they might not be eligible, then, to receive full financing under the Recovery Act. 

And also one of the questions goes to using the water efficiency 

as a priority for actual water savings rather than some of the 

projects which don’t seem to prioritize water efficiency. 

And then lastly, linking energy efficiency directly to the goal of 

clean water. So for example, not funding projects like getting sort 

of efficient vehicles as part of the funding, because funding is so 

limited for these kinds of projects. And I wonder if you could just 

speak to this. 

Ms. GELB. Thank you, Congresswoman. Actually I am not sure 

which letter you are referring to. But if I could talk for just a 

minute about what EPA is doing to ensure that the green project 

reserve is used as intended, the ARRA, as you know, requires at 

least 20 percent of each capitalization grant be spent on green infrastructure projects, so long as there is sufficient applications and 

we are assured that most States are able to do that part. Our goal 

is for all States to utilize the funding and, as such, we have set out 

clear definitions in our March 2nd program guidance of what enVerDate Aug 31 2005 10:45 Jul 21, 2010 Jkt 000000 PO 00000 Frm 00090 Fmt 6633 Sfmt 6633 P:\DOCS\53286.0 KAYLA
23 

ergy efficiency, water efficiency, green infrastructure and innovative projects are. 

Additionally, we have issued guidance explaining the type of solicitation that is needed in order to meet our requirements in the 

event that a State has difficulty finding such projects. Our guidance provides detailed examples of projects that meet the definitions, and we are working with States when there are any questions about particular projects on the list. Only the portion of a 

project that actually meets the definition counts toward the 20 percent reserve. If a project is not on the categorical list that we have, 

the State must present a business case that would explain how the 

program meets one of our goals. And then we review that business 

case, in concert with the State, in order to count it towards the 20 

percent requirement. 

We know this is a new business model. As such, are working 

with the States and hoping to make it a success. As I said, I am 

not familiar with the particular letter you are referring to, but 

would be glad to look into that and get back to you. 

Ms. EDWARDS. That would be great. What I would like to do is 

actually, Madam Chairwoman, submit for the record—it is a letter 

dated September 25th that actually salutes you for what you are 

doing on the fund but looks into—— 

Ms. JOHNSON. We need to have a recess and return, so we can 

all get over in time to vote. You will be recognized as soon as 

we—— 

Ms. EDWARDS. Thank you. But I would like to submit this for the 

record. Thank you. Then you will have it. 

[The information follows:] 

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Mr. TEAGUE. [presiding.] Okay. We will go ahead and reconvene 

our meeting here. Some people may still be coming back from voting and come in, and some have other meetings to go to. So we will 

just get right in here. 

I would like to ask a couple of questions, if I could, of Mayor 

Nunley from Ruidoso. A couple of questions. How many jobs do you 

think were created and/or saved with the project for Ruidoso and 

Ruidoso Downs? And also where do you think that the project of 

the wastewater treatment facility would be if it wasn’t for the 

ARRA funds? 

Mr. NUNLEY. There are approximately 75 people working down 

there now that are new jobs. When we get into full swing with the 

project and they start putting the filters in and building a building 

for the filters and everything, I think probably around 125 to 150 

jobs would be tops. 

Your second question? 

Mr. TEAGUE. Yes. The second question is where would the project 

be if it had not been for the ARRA funds? 

Mr. NUNLEY. We were prepared to borrow the money from the 

environment department, New Mexico Environment Department. 

And it was a little out of our price range, but we were going to 

have to do it anyway. And the stimulus package kind of saved our 

bacon, to tell you the truth, Mr. Teague. I thank all of you for that. 

Mr. TEAGUE. Thank you. And I also thank you for the testimony 

you have given us here today. I think it is encouraging to everybody on this Committee to know that we are having some success 

with these programs and they are working. 

I did have one more question for Ms. Gelb. As you know, the outlays are a lagging indicator of the water infrastructure construction. The Clean Water Revolving Funds operate on a reimbursement basis. But do you have an idea of how we are progressing 

with that and what some of the results are? 

Ms. GELB. Thank you, Congressman. Yes, as you said, outlays are an indicator to date. The clean water SRF has issued $170 million in outlays. But again, that is not necessarily our measure of 

success. What we are seeing is that as of the end of October, there 

are 797 assistance agreements executed with States for about $1.7 

billion. We have 740 million, or 20 percent, of our projects totally 

under contract. So we are seeing some success as interim milestones. 

Mr. TEAGUE. Thank you. And now I will turn to the Ranking 

Member, Mr. Boozman. 

Mr. BOOZMAN. Thank you very much. I guess the question I 

have, Ms. Gelb, is we have had a sheet and we have heard testimony that some of the States are having trouble spending their 

money and things. Can you help us understand some of the problems that they are having in that regard? And perhaps whatever 

solutions that we can come up with to help our States in getting 

this money obligated and spent? Yes, ma’am. 

Ms. GELB. Thank you. Yes. There are some new requirements 

within ARRA that our State programs were not as familiar with, 

as I think you know. While the States may have been familiar with 

Davis-Bacon, it has not been applicable to this program before. So 

this is a new requirement that the States had to learned. 

40 

Similarly, Buy America requirements were new to the program, 

new to us here in headquarters, and we were able to work with the 

States, providing them information and guidance and assistance 

through Webcasts, through personal site visits and training. That 

is just an example of some of the new requirements in a very longstanding program. 

The States, as I think was mentioned earlier, have a lot of history and a lot of success with the State Revolving Fund programs. 

But with these new requirements, it did take a little bit of a learning curve. 

Mr. BOOZMAN. At EPA, how many jobs do you feel like have been 

created? 

Ms. GELB. Job reporting was done through recovery.gov. States 

had to provide their information by October 10th. We were analyzing that information for a couple of weeks after that period of 

time. We have preliminary numbers that we have not scrubbed yet 

and they are certainly not broken down by programs. So I am not 

exactly sure yet what the State Revolving funds would be. And I 

would be happy to get back to you when we have that information. 

It should be shortly. 

Mr. BOOZMAN. Mr. Nunley, why such a strict permit on your 

community? 

Mr. NUNLEY. I cannot answer that definitively. 

Mr. BOOZMAN. You would be in one of the top 17, 18—I guess 

really one of the most stringent—with both of the requirements in 

the country. 

Mr. NUNLEY. We have been told that we are the most stringent 

in the country. 

Mr. BOOZMAN. So you have the increased cost of putting the system in. And then how much more will your operating costs be as 

a result? 

Mr. NUNLEY. About double. 

Mr. BOOZMAN. So you have got those ongoing costs that are going 

to—— 

Mr. NUNLEY. Yes. We started out with just phosphorous, and 

that was a pretty low limit at .1, and then halfway through the 

project, when we were engineering the thing, they said, no, we 

want nitrogen, too, at 1 milligram per liter. And that just doubled 

it, because all the technology and all the engineering that is available today says that we can’t reach that limb. But we are going to 

make every effort to get there and do that. 

And the Environment Department in New Mexico is working 

with us on that issue. And I cannot tell you that they said we are 

going to work with you if you don’t meet that limit, but they have 

indicated that they are going to do everything they can to see that 

we meet it; and if we don’t meet it, they are going to work with 

us on that issue. So it is difficult, but we are going to try to do it. 

It is hard. I am concerned about the very, very stringent limits 

like that that appear to be coming more and more—that is a tremendous unfunded mandate, and you are blessed you are able to 

benefit from the stimulus and some of this other funding. The reality, though, is that you would have had to do that anyway, and 

the cost to your taxpayers would have had to have borne all of that 

which in some cases—well, you would an great example. It would 

41 

be questionable as to if you could actually do that with your ratepayers. 

Mr. NUNLEY. We have been told by our engineer, who is a very 

good firm, that the normal limits for nitrogen is about 10 milligrams per liter and they are putting us at 1. And I think part of 

the problem is that the previous administration, maybe the previous two administrations, tried to pick a fight with EPA and tell 

them they were unreasonable and they were fighting with the 

wrong people. 

And when I got elected mayor—I have been in politics for 18 

years in Ruidoso, but just 4 years as mayor. But when I got elected 

mayor, I knew right away that I had to mend some fences and get 

this thing on the road because we were under a court order to finish it up. 

Mr. BOOZMAN. One last question, Ms. Darcy. Can you give us an 

estimate on the jobs created? And, again, I do—Mr. Oberstar and 

I were talking on the way over here about the bridge that was completed in record time after it failed and things. That was due to 

agencies cooperating together instead of having an adversarial relationship or just not really having a relationship. 

So I do appreciate the work that the Corps is doing with USDA 

in Arkansas, and it appears that you are doing a good job of doing 

that throughout the country. Do you have an estimate on job creation? 

Ms. DARCY. I think by the end of the entire ARRA program, it 

is estimated that we would probably have 50,000 jobs as a result 

of the 4.6 billion that the Corps was appropriated. 

Mr. BOOZMAN. Very good. Do you have similar problems—I asked 

Ms. Gelb about the end users not being able to spend the money 

and stuff. Are we having similar problems like that within the 

Corps structure? 

Ms. DARCY. No, sir. What we do is obligate the money and give 

it to contractors right at the beginning of the contract. So we don’t 

give grants or loans, as the EPA and some other agencies do. We 

do direct contracting. 

Mr. BOOZMAN. Good. Thank you, Mr. Chair. 

Mr. TEAGUE. Next I would ask Congresswoman Napolitano from 

California. 

Mrs. NAPOLITANO. Thank you, Mr. Chairman. And I am very 

glad that we have today’s meeting. So thank you for this very interesting conversation on some of our more important projects. 

For Ms. Gelb—and I have already spoken to you briefly because 

California’s environmental review did not—many of the projects 

didn’t receive the funds because they didn’t have the NEPA clearance. Well, California’s CEQAis more stringent that NEPA, and we 

have been trying to figure out how do we allow those projects to 

be certified, because they are, in fact, more stringent that our own 

Federal requirements. 

And I would love to have—I know you don’t have an answer. If 

you would look at it, I would love to have you either come back to 

some of us that have an interest in it. 

Ms. GELB. Thank you, Congresswoman. I would be happy to do 

that. 

42 

Mrs. NAPOLITANO. Thank you. And I can tell you that I have 

been pleased to work with the Western Region for at least 15 

years, and they were the best. So I really thank the agency for all 

the work they have done. 

I would like to have an idea if there is any way of being able to 

find out if you have a backlog on some of these contaminated sites, 

because we seem to find them and then, all of the sudden, we have 

to go through a whole sequencing to be able to clear them up. 

My concern is for water contamination because we have the 

drought in the west—Western States for that matter—and any 

water that we have that we are able to identify and be able to see 

how it stands, we need to be able to clean it up and find the PRPs, 

those potential responsible parties, so that we can be able to assure 

our communities that they may have additional sources of water, 

because there is no new water. 

Ms. GELB. Congresswoman, I would be happy to get back to you 

on that issue as well. There are a number of issues associated with 

that, and I think it would be helpful to have a fuller answer. 

Thank you. 

Mrs. NAPOLITANO. I really appreciate it.And, Ms. Darcy, I really 

have a great respect for the Army Corps. We have worked with 

them on several projects in my area and my surrounding community. And currently as I have mentioned, we are working on the 

Whittier Narrows Dam that the Corps is hoping to be able to do 

an update of a feasibility study. 

The water replenishment district, the local water replenishment 

district is offering to pay for an interim deviation report for 3 years 

to allow us to get the funding to be able to do the feasibility study, 

a full study. Again, a renewal of the study. Again, we were able 

to get 134,000 this budget year. We hope to get the rest of it next 

year. And we would like to be able to see how we can get somebody 

to say yes to these people who are offering to pay for this interim 

study so the Corps can then continue their work. And that is something that I would very much like to see results on that. I look forward to responding to you. 

Mrs. NAPOLITANO. Thank you so very much. 

And then we can get back to Ms. Gelb on groundwater and 

drinking water. Again, the major focus is to be able to identify 

those areas, and if there is a way to be able to have EPA relate 

to us so we can then work with all the other water agencies—the 

Committees or Subcommittees that have water jurisdiction—because we need to start looking in the future about being able to 

identify those bodies of water that we need to be sure are cleaned 

up, and that we help our communities prepare for oncoming 

drought that we know climate change is bringing upon us. 

Ms. GELB. Thank you. And we will look forward to working with 

you further on that. 

Mrs. NAPOLITANO. Thank you. The Clean Water State Revolving 

Fund, Ms. Gelb, operates on the reimbursable basis. What other 

ways can we track construction on these if some of those funds— 

since you don’t outlay until the work has already been performed 

and the State seeks reimbursement? Are there any number of 

projects that have been put out to bid on contracts underway? Is 

there a better way to measure the progress? 

43 

Ms. GELB. Thank you. Yes. With two State Revolving Funds, the 

Clean Water State Revolving Fund and the Drinking Water State 

Revolving Fund, we were looking at ways to measure interim success for the States in advance of recovery.gov where the States 

would then provide information on a quarterly basis. 

We went out with a pilot program to collect information for both 

of those systems, and it allows us to assess progress with dollars 

and assistance agreements, dollars where—and projects where all 

contracts are executed, which is the lead indicator for us on whether the State is able to meet the February 17th deadline. It allows 

us to assess whether funding has been provided in projects for 

green infrastructure. And a number of other indicator measures 

that let us know the interim success of the program. 

Mrs. NAPOLITANO. I am assuming it also helps you help those 

States that are lagging behind? 

Ms. GELB. Absolutely. In fact, based on the information we received in our reporting system, which is updated on a very regular 

basis—I get weekly reports—we made contact with 14 individual 

States over the last couple of weeks. Mr. Hooks and I personally 

made phone calls to the Governor’s Offices of 14 States to make 

sure they understood that EPA is there to help them with any 

issues or any concerns that they might have. 

We want to ensure that those States get over the finish line and 

we want to make sure they expend all of their dollars—get all of 

their dollars under contract by February 17th. 

Mrs. NAPOLITANO. Thank you, Mr. Chairman. And I would submit other questions for the record. 

Mr. TEAGUE. Thank you, Congresswoman Napolitano. 

And at this time, one of the things that I have really come to appreciate my first year here is the knowledge and the insight of the 

next man that is going to speak, Chairman Oberstar. 

Mr. OBERSTAR. Thank you very much, Mr. Chairman. I understand that you have another obligation to attend to. So please feel 

free to leave at this time. 

Mayor Nunley, I heard your plaintiff appeal early on that caught 

Ms. Edwards quite by surprised, that you are looking to annex the 

Potomac River. I think there would probably be some objection out 

here. But I thought we might look for a lake in northern Minnesota 

that no one is using right now. Maybe we could loan it to you. 

Mr. NUNLEY. It is my plan to just annex the right-of-way, the 

road coming up here, and then we can take the lake in when we 

get there. That would be fine. 

Mr. OBERSTAR. We want to help you out, because I know New 

Mexico is a little short on those things, water. So is Arizona. 

Mr. NUNLEY. Can I put that in the paper when I get home, Mr. 

Oberstar? 

Mr. OBERSTAR. Ms. Darcy, the Corps typically, in the ordinary 

course of events on projects, holds funds back on—at the outset of 

a project until the project is completed. And I know that the Corps 

has done the same with the stimulus funds. 

Second, the bids are coming in about 25 percent, on average, 

lower than the final design estimates, not only for Corps but for 

clean water, drinking water, for the highway and transit projects 

as well. We are finding that these dollars are stretching farther 

44 

than we anticipated because of economic conditions and a number 

of other factors we don’t need to go into here. 

So the question I have is, does the Corps have a plan? Are you 

working on a plan for what you are going to do with those additional dollars? 

Ms. DARCY. Yes, sir. As you know, we had a list of 826 projects 

that we anticipate spending our funds on. But as you rightfully 

point out, some of these contracts are coming in lower because of 

the current economic situation. So we are going to evaluate, probably on a monthly basis, what kinds of other projects might be able 

to now become eligible for those funds that we will have—not left 

over, but we will be expending in the next several months. 

Mr. OBERSTAR. So we can anticipate that sometime in January 

or February making a reassessment of where the budget or how 

the budget looks at that point, and go back to those 800—well, was 

it 826 at the start of this and you have committed to some 4- or 

500? 

Ms. DARCY. No, so far we have work on the ground ongoing at 

731. 

Mr. OBERSTAR. 731. Oh, sorry. I missed that. 

Ms. DARCY. We will be evaluating maybe even more quickly—I 

hope my staff doesn’t tell me otherwise—more quickly than 2 or 3 

months from now. I think we will be constantly reevaluating what 

money we do have, especially money that comes from contracts 

coming in under bid. 

Mr. OBERSTAR. Then when we have our December hearing on 

stimulus, we are doing it every 30 days. 

Ms. DARCY. I am putting it on the calendar, sir. 

Mr. OBERSTAR. And it is working. I don’t know about the rest of 

the stimulus, but I know the part that is under the jurisdiction of 

this Committee we can account for. We know where the dollars are 

going, where the projects are, how many jobs have been created, 

and what the payrolls are. So we will look forward to seeing that. 

I want to come back to the issue Mr. Brown raised; it is not because he raised it as such, but because it represents a category of 

issues that I have heard from colleagues on the floor. You have 

Georgetown Harbor with an authorized depth of 27 feet; it is not 

operating at that depth. What were the considerations that led to 

not awarding funds for channel improvement in Georgetown Harbor? 

Ms. DARCY. Sir, my understanding is that there were many, 

many harbors, that were in the same situation as Georgetown Harbor, meaning that they had not received operation and maintenance funding in recent years. And Georgetown Harbor was, I 

think, one of many that, when we got through our list of the 

amount of money we had for operation and maintenance, we had 

many more projects than we had money. 

Mr. OBERSTAR. So there was a triage of sorts, not in the medical 

sense, but you had to make decisions. What were the factors and 

why did Georgetown and others fall out? 

Ms. DARCY. As I say, I think we had a list of projects that were 

eligible for the operation of maintenance funding—— 

Mr. OBERSTAR. Meaning ready to go under the terms of the Recovery Act? What does ′′ready to go′′ mean in Corps terms? 

45 

Ms. DARCY. It means that they were able to execute a contract 

in a timely manner to do the—— 

Mr. OBERSTAR. Within 120 days? 

Ms. DARCY. I believe it was 90. I am not sure if it was 120. 

Mr. OBERSTAR. It was 90 days when it left this Committee. It got 

extended when it got to 120 days in conference; 120 days to obligate funds. That was not my first preference. I wanted these 

projects under contract. So you will get back to us with a response? 

Ms. DARCY. Yes. I think the case here is that we had a number 

of projects that were eligible and in going down the list we had X 

amount of dollars, for—not enough dollars for as many projects 

that we had. 

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Mr. OBERSTAR. That is right. If the House bill had prevailed, we 

would have a whole lot more. And while—I am sorry to repeat myself for those who heard it before, but I think it was a mistake to 

put the tax cut in this recovery package, although economists with 

a broader view of the picture are saying, oh, yes, that has helped 

put money in people’s pockets. But I have never received a letter, 

an e-mail, or a handshake from anyone— Mr. Boozman, did you? 

Mr. BOOZMAN. No. 

Mr. OBERSTAR. You didn’t get any thank-yous either. 

Mr. BOOZMAN. But that is generally the case. 

Mr. OBERSTAR. No, no, no. People, when they see the road built, 

they see the street dug up and the sewer going in, they say, gee, 

that is great, thank you; we are seeing results, we are not seeing 

any results from that thing, the tax cut thing. 

I have been told to keep quiet, the President wanted a campaign, 

he won the election, he gets what he asked for. So, all right. 

Reconnaissance. Can you tell us how many reconnaissance 

projects have been—how much reconnaissance work has been funded with the Recovery Act? 

Ms. DARCY. The Recovery Act dollars, I don’t know offhand. 

Mr. OBERSTAR. But it is an eligible item, isn’t it? 

Ms. DARCY. I believe it was, yes. 

Mr. OBERSTAR. Would you get back to the Committee? 

Ms. DARCY. As long as it wasn’t new, right? 

Mr. OBERSTAR. Yes. If there were a levee that is way outdated 

and really needs to be restored, all it needed was reconnaissance 

work done to evaluate the condition, potential costs, potential benefits that—just get back to us with that. 

Ms. DARCY. I will, sir. 

Mr. OBERSTAR. There are a number of those that Members have 

asked about now that the Recovery Act is maturing and questions 

are being raised. So I would like to have that information. 

Ms. DARCY. Yes sir. 

Mr. OBERSTAR. Ms. Gelb, thank you very much for being here. 

Didn’t you apologize for somebody, some senior person who couldn’t 

be here? 

Ms. GELB. Mr. Hooks is home with the flu. And I think we are 

all grateful—— 

Mr. OBERSTAR. We don’t want him in the room with that. You 

are a wonderful representative for EPA. Thank you. 

We have, if I recall the numbers rightly from my presentation at 

the Rules Committee yesterday on the security for chemicals used 

in wastewater treatment facilities, 600,000 miles of sanitary sewer, 

200,000 miles of storm sewer nationwide; 16,000 publicly owned 

treatment works. 

How much of that mileage and how many of these treatment 

works are being touched by Recovery Act requests from the States? 

And I ask that because EPA doesn’t make those determinations. 

EPA sends the money out to the States, they do the implementing. 

All this stuff about paperwork and delay, red tape—there was no 

red tape. The money all went out. 

I read those numbers off at the beginning of this hearing. Those 

projects, the dollars went out to the States. They were notified, and 

48 

then it was up to them to act on it. Did you have any—do you keep 

track of how much of this work is being addressed? 

Ms. GELB. Sir, no. Mr. Chairman, I don’t think that we have on 

a national level an accumulation of the number of miles that is 

being funded through—— 

Mr. OBERSTAR. That may not be the best way, but it is one way 

of evaluating. So it would be good to ask your State agencies to tell 

us what work is being—how many miles are you addressing. 

Ms. GELB. We will see what information we can get and then we 

will get back to you on that. 

Mr. OBERSTAR. It would be interesting to address that issue. We 

passed legislation in the 110th Congress and again in this Congress to reauthorize the State Revolving Loan Fund program at 

$15-plus billion dollars. It hadn’t been reauthorized in 13 years. At 

that time in the course of the hearings leading up to the bill, we 

had testimony about the vast number of treatment works that are 

well over 40 years old, those that were built in the immediate 

aftermath of the Clean Water Act of 1972. When I was sitting 

down there at that staff table, an administrator, crafting the Clean 

Water Act of 1927, we had $6 billion a year in grants, 80 percent 

Federal grants; built a lot of treatment works, the big ones for the 

big metropolitan areas. 

And then Ronald Reagan came in in 1980, and in his budget in 

1981 in the Reconciliation Act, converted the $6 billion—cut 4 billion out and converted the remaining $2 billion to a State Revolving Loan fund, which we have today. 

That was right at the time when the program was to shift from 

70 percent of the money going to the big metropolitan areas— 

Mayor Nunley, Mr. Gritzuk—to smaller jurisdictions, those under 

50,000 populations, smaller tax base, less revenue to address their 

wastewater needs. And right at that time, shifted the burden of 

cost to smaller jurisdictions and then didn’t fully fund the program. 

And we are way behind. 

Now, this stimulus money was to help us catch up on some of 

that work. How much of that work do you think we are catching 

up on? 

Ms. GELB. Mr. Chairman, as you know, the gap in the clean 

water infrastructure program is quite extensive. We know that the 

ARRA funds were very successful in helping States meet some of 

their unmet need up until this point. As you mentioned earlier, 

many of the projects are coming in at a bid less than what had 

been anticipated, and so luckily the States have had deeper project 

lists on their intended use plans. They are able to go further along 

in meeting some of the need, being able to stretch their dollars a 

little bit further. How much further has yet to be seen. We are still 

working with the States on gathering that information. And in 

terms of how that addresses the gap, we would be happy to get 

back with you with a particular number later on. 

Mr. OBERSTAR. I want you to do a calculation for the Committee 

on the estimate of what—we know what the backlog is of POTWs, 

of sanitary sewer, storm sewer, combined sewer. And we have 

passed legislation to deal with it, but the Senate hasn’t acted on 

it. It is like the dead letter office. You might as well land it on the 

49 

Moon, and nothing happens because you have to have 60 votes to 

blow your nose over in that body. And the needs continue to grow. 

So I would like you to do an updated calculation of those facilities that are almost as old as I am, that need updating, the systems with combined sanitary and storm sewer that need to be separated. How much of that is being addressed in the funding and 

Recovery Act and how much more could be addressed if we have 

a second round, which I am working on doing that? 

Ms. GELB. Thank you, sir. We will get back to you on your request. 

Mr. OBERSTAR. Now, we have had a request from the Associated 

General Contractors to submit a statement for the record, from the 

Water and Wastewater Equipment Manufacturers Association, and 

from the American Iron and Steel Institute to submit their statement for the record, which, without objection, we will do. 

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Mr. OBERSTAR. But the central issue raised in these two letters 

deals with the Buy America provision. And the equipment manufacturers say, quote, ′′Inclusion of Buy America policy has had a 

devastating impact on municipal procurement and the U.S. water 

and wastewater industry in particular.′′ 

They don’t submit any specifics in support of that statement, but 

they do raise the issue. Now, I know that in preparation for the 

stimulus, EPA issued three nationwide waivers on equipment that 

is not manufactured in America—under the provisions of the Buy 

America Act, which EPA is authorized to do—to issue three nationwide waivers for items that can’t be purchased in—made exclusively elsewhere— and three regional waivers, certain regions of 

the country; and third, a de minimus waiver for incidental components to pumps, lift stations, hydrants and so on that are part of 

the machinery of infrastructure. 

For example, Auburn, Maine, the sewerage district requested a 

waiver for ductile iron, spring-loaded hinged manhole covers and 

frames. And the waiver was granted in May. I don’t know what 

they are complaining about. They are just making a general complaint. 

So I want you to review these letters and give a response to the 

questions raised. I can go on, and I won’t, although I do want to 

signal—I just wanted to—Bristol, Vermont, for their water system 

and the Otter Valley Union High School in Brandon, Vermont, requested a waiver for certified ultraviolet disinfection equipment. I 

mentioned this generally in my opening remarks. That waiver was 

granted. But what we learned subsequently is that U.S. manufacturers who are making ultraviolet disinfecting equipment for air 

pollution equipment said we can do it for water. If we do it for air, 

we can do it for water. And a whole new manufacturing sector 

sprang up as a result of the Recovery Act. 

Now there are 50 or 60 jobs in this plant producing ultraviolet 

equipment. It would be good for you to—your staff and all to review 

these waiver requests, how many have subsequently stimulated 

U.S. production, and just generally respond. 

Of course, I will respond to the manufacturers’ claim that of $6 

billion in stimulus funds for a State Revolving Loan Fund program, 

only 225 million has been paid out to date. You have to do the 

work first and then get paid. The same thing in their business. 

They don’t get paid first and then deliver the equipment. It is only 

when the contracts are under performance and the State is paying 

the contractor—I mean, the municipality is paying the contractor, 

and then they come back and ask for the reimbursement. All right? 

Okay. 

Secretary Hanger, several States have told us that recovery 

funds have been helpful for communities to address their noncompliance issues. We had a requirement in the act also, it was 

my—I will take credit for it, or blame, whichever it may be, but I 

insisted that in all of the recovery funds under the jurisdiction of 

this Committee, the funding be allocated on a priority basis to 

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75 

minations every month. And this is a job-creating program. Funding ought to go to the places that have the highest unemployment. 

So, generally, States have done a good job of complying with that 

requirement. So can you address that issue, your distribution of 

dollars according to highest unemployment, and how many of those 

who were out of compliance have also been helped? 

Mr. HANGER. The recovery dollars have been often completely 

vital to communities facing serious noncompliance issues. Recovery 

dollars have allowed us to provide grants in cases where grants 

alone really can meet the need because the communities, they have 

a very low tax base; B, seriously decrepit infrastructure, quite literally. In some instances we have found 100-year-old lines—wood— 

we have taken out some wood. And often those two circumstances 

coincide with very high unemployment, local unemployment. 

So offering a loan to some of those communities, even at a very 

low interest rate in some instances won’t enable the project to get 

built and—because there is not enough money to pay back a loan, 

even at a very low interest rate. So those dollars have dealt with 

serious environmental and public health impacts. 

These noncompliance issues, at least in my State, are serious 

ones. We are talking about raw sewerage in some instances entering water. We are talking about substantial loads of nitrogen and 

phosphorous entering water that then causes waterways to be unable to be fishable or swimmable, the Clean Water Act goals. 

So the dollars have been a blessing. It has allowed probably—it 

is at least a four-time increase over what the State Clean Water 

Revolving Fund could have done in a normal year. And we have 

also—the State taxpayers have also put a considerable amount of 

dollars on the table to further increase the work that we are doing 

at—— 

Mr. OBERSTAR. Thank you for that response. That is very good. 

And I would like you to submit for the record information on a 

number of communities who were in noncompliance, who have been 

helped to come into compliance with Recovery Act funds. That 

would be very beneficial. 

Mr. OBERSTAR. And then we will ask EPA to do that nationwide 

and quickly survey the State SRFs and ask them to respond to that 

question. If we can do a 2-for-1, create jobs, bring communities into 

compliance, maybe three, and then you clean up receiving bodies 

of water to be closer to the goal of fishable, swimmable, we are 

doing a really great long-term service for the country. 

Do you have a rating system in Pennsylvania? In Minnesota, the 

SRF has a list of 263 projects. They have them 1 through 263, 

towns that have no treatment system at all. They have septic systems or mound systems. And here is Minnesota’s listing. It just 

goes 1 through 263 where is the other thing here, that page? It 

goes from 1 to 263 and they just went down that list. These towns 

have all been waiting for funding for years, and there was no second-guessing except—here is my list. 

Thank you, Ryan. For the record, Ryan Seiger. This is the list 

that Minnesota used. So they didn’t have to do any second-guessing 

or—and there were no complaints from the communities, Oh, I 

didn’t get mine. They all knew where they were. That list has been 

available for years, every year, with the available funds, meager 

76 

funds that Minnesota has had, meager funds that you have had in 

Pennsylvania. They have doled it out according to this. 

Do you do the same kind of thing? 

Mr. HANGER. Yes, but in a slightly different way. We certainly 

keep track of those communities that are in noncompliance. We 

have permits and we are well aware of what communities are in 

noncompliance and what communities have significant financial 

problems as a partial explanation for the noncompliance. 

And what we do is work with communities and, as you say, we 

have a backlog of projects. We always have a backlog of projects. 

And we did require the communities to apply for these funds. We 

didn’t simply go through a preexisting list and say—we can go 

down to the 30th on the list. We did have an application process. 

But we have a lot of information and relationships with these communities because in many instances the problems are longstanding, 

and we have been struggling with those communities to sort of put 

Band-Aids when really a Band-Aid won’t fix it. 

Mr. OBERSTAR. That is a very good description. Exactly what it 

is. Did you have experienced communities in Pennsylvania that 

had trouble with the Buy America Act? 

Mr. HANGER. I have not received a lot of complaints about that. 

And as you can see, we have already got a lot of projects out to 

bid and under contract and even underway. And I think, further, 

in Pennsylvania there is a lot of support for the notion of making 

these dollars stay in the United States and stay in Pennsylvania. 

So I think there is a lot of understanding for the purpose of that 

requirement where these dollars—I mean, this is about the American economy, our crisis, our workers. And in our experience, it has 

been a workable provision, as you pointed out eloquently. There are 

waivers so that when we are in a situation which I would call a 

tragedy, where you just can’t find something made in the United 

States any longer in order to—that is necessary for a project—there 

is a waiver that is possible. 

Mr. OBERSTAR. Thank you. Thank you for that response. 

I found that where we are underinvesting, we as a Nation, cities, 

States, underinvesting in an economic sector, that the production 

to support that sector dries up. And often the industry itself moves 

offshore, moves to Europe, China, Korea, Taiwan, Japan. That is 

what happened with transit all through the 1950s and 1960s and 

1970s. Then we started putting some money into transit agencies 

in America. I held hearings—did you know Bill Clinger from Pennsylvania, Member of Congress, State College District? 

Mr. HANGER. Yes. 

Mr. OBERSTAR. He and I on this very dais held hearings on a 

Buy AMERICA provision. We found that the Federal Highway Administration was 100 percent in compliance, all the steel going into 

the Federal aid highway programs, American steel. That meant the 

steel works in Pennsylvania, Ohio, Indiana, Illinois were pouring 

raw steel, and iron ore mines in my district were making the iron 

ore to supply the steel mills. 

We got to the transit agency and more than 50 percent of all the 

work was offshore. All the major components for streetcars, light 

rail, commuter rail, intercity—other intercity passenger rail, bus 

systems, had dried up in the United States. Allied-Signal was the 

77 

only one left in the United States, and they were buying a lot of 

their components from foreign suppliers. Why? Because there was 

no market in the United States. 

But then in 1982, we committed a penny out of the Highway 

Trust Fund revenues, penny of the gas tax to transit. And that now 

is about 8- $9 billion a year. And we have had two foreign-owned 

bus producers relocate into the United States. We have all these 

suppliers for rail transit, for streetcar, for light rail systems and all 

the rest, all coming back to the United States. They found a way 

to relocate in the U.S. marketplace and build product for the U.S. 

marketplace, because there is a demand for it there is a need for 

it and there is money to buy it. 

That is what we are doing with this stimulus program. If it has 

the ancillary effect of stimulating U.S. manufacturing jobs, so much 

the better. 

Now, I want to thank Mayor Nunley and Mr. Gritzuk for making 

the long trek to Washington. It is a long haul to come out here 

from your part of the world. But you are on mountain time zone? 

You as well, Mr. Gritzuk. That is a 2-hour difference in time. Awfully good of you to participate in this hearing. 

Do you have some lessons learned that we can apply to the program from here on out, and for a second round, if we do a second 

round of stimulus? 

Mr. GRITZUK. Can I? 

Mr. OBERSTAR. Please. 

Mr. GRITZUK. We very much appreciated receiving the stimulus 

funding. In fact, it was an incentive to move ahead with the project 

that I described. And what it also did for us is that with the funding that we received, we took that funding and we will apply it to 

an unfunded project. And in this case it would be a project, a sewer 

line that needs rehabilitation. 

The advice that we could give is that you have to be aggressive 

in this program. I think we were in Arizona. I think that Arizona 

demonstrated that it could move ahead aggressively, utilize stimulus funding, and get the jobs awarded and so forth. 

The problem we are suffering from is that we would sure love to 

see more it of. Overall, our program at Pima County, our regulated 

program has a value of $720 million. Much of this is a regulated 

program. Much of this is to increase the treatment of effluent that 

we discharge to the Santa Cruz River, similar to New Mexico. And 

this is a very, very expensive program. 

And to date, of the $720 million that is budgeted for this program, the ratepayers will have to pay for all of that in their rates, 

with the exception of the $2 million that we received from stimulus 

funding so far. So it is all locally funded. 

And as you move into the future, how much more can ratepayers 

tolerate on a lot of this unfunded mandate type of regulations that 

we are having? So any type of stimulus funding, water trust fund, 

would be extremely helpful to us. 

Mr. OBERSTAR. Thank you. Mayor Nunley, do you have some 

thoughts? 

Mr. NUNLEY. I had some experience with Buy America issues 

and I am going to have to say that EPA did a marvelous job for 

me. We purchased some filters, there are only two manufacturers 

78 

of the type of filter that we had to try to make this limit work, and 

one was by Kubota and another was by G.E. Kubota is made in 

Japan and assembled in the U.S. And G.E. Is made in Canada. So 

a year and a half ago, we went out for bid to try to buy those 

things to beat inflation a little bit, and we used Kubota. And when 

Buy America popped up, we immediately got on our little horse and 

contacted EPA and got the proper paperwork submitted to get a 

waiver on that. 

And I have to tell you that it only took about 6 weeks. They did 

a great job for us and it didn’t slow us down one bit. So I appreciate that. 

And I also appreciate the stimulus monies. And I think that my 

town is no different than most towns in America in the fact that 

our infrastructure is wearing out. We are using 50-year-old pipes 

to deliver water and sewer. And any help that the House can give 

us, any help that Congress can give us in the way of a stimulus 

package, whatever the name of it is, is something that is an investment in our future. And I think that investing in America is a good 

idea today. 

Mr. OBERSTAR. Music to my ears and music to most of the Members of this Committee. I think Mr. Boozman would agree with 

that. Was that the membrane bioreactor filtration system? 

Mr. NUNLEY. That is correct. 

Mr. OBERSTAR. That is the one you are talking about. And you 

got a 6-week turnaround on that? 

Mr. NUNLEY. Yes, sir, we did. 

Mr. OBERSTAR. Mr. Gritzuk, you are here on behalf of NACWA 

and you caught got my attention with your reference to trust fund 

for water and wastewater treatment. When President Eisenhower 

vetoed the clean water—the Federal Water Pollution Control 

Amendments of 1960 after my predecessor, that gentleman in the 

corner portrait, John Blatnik, was the author of the first Federal 

Water Pollution Act of 1956. And there had been nothing before 

that. There was a small little kind of a research, but nothing significant. This was a first effort. 

And as part of the FWPCA program, we had researched to understand the causes of pollution, what factors in the wastestream 

were causing plant growth and algae and so on. Second, grants to 

build sewerage treatment facilities, $30 million program of 30 percent Federal funds and an enforcement program that consisted of 

States getting together and talking about their pollution and deciding we should do something about it. That was totally ineffective. 

That was all you could get through. 

I came back after 4 years of experience with the program and 

wanted to upgrade it and make it $50 million and 50 percent Federal funds, and President Eisenhower vetoed the bill with a veto 

statement that concluded pollution, quote, ′′Pollution is a uniquely 

local blight. Federal involvement will only impede local efforts at 

cleanup,′′ closed quote. I remember it very well. I memorized it. I 

wasn’t on the staff at the time, but subsequently I was. 

The person who wrote that veto message was Bryce Harlow. He 

later went to work for Procter & Gamble, a soap maker. Pollution 

is not a uniquely local blight. The water goes into streams that 

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79 

volvement is necessary to have a national program, national treasure, and a national resource. And we established an authorization 

level, and there was a will to fund these programs in the early 

going when soapsuds floated down the Ohio and Illinois Rivers, 

when people turned on their faucets and soapsuds instead of clean 

water came out, and when the Cuyahoga River caught on fire in 

1969 and it was a national calamity. 

But it seems that the will to fund has dissipated, and the idea 

of a trust fund is a very appealing idea. What is the revenue 

stream for it? How do you get a dedicated source of revenue to sustain the funding year to year? Do you model it after the Superfund 

program, as we did with going back to the generators of the toxic 

substances that go—the chemicals that go into the products that 

wind up in our landfills? Or what other sources do you find? I expect—I don’t expect you to be exhaustive in responding to the question, but I raise the issue because you intrigued my attention. 

Mr. GRITZUK. Okay. The primary driving force for a trust fund 

is basically have those people pay for the benefits that they get out 

of clean water and wastewater disposal, and also for a fund like 

this to be revenue-neutral. And maybe more so, it will model the 

highway Trust Fund. 

So, several examples. Beverage producers who need clean water 

for their product, perhaps add a penny to a bottle of soda or a can 

of soda. And products that are disposed down the sewer, add a couple of pennies to what you dispose of. Individuals call it a tax. I 

don’t think that is a proper term. I really do think it is a minimal 

fee on the benefit that the individuals get from clean water and environmental control. 

Mr. OBERSTAR. It is a fee for use of a system. 

Mayor Nunley, do you have some thoughts about this? You are 

on the firing line there at the community level. 

Mr. NUNLEY. Yes, sir. We have—we don’t call it a trust fund, but 

we have established a wastewater fee to help pay for the plan. And 

it started out at $35 a month for our customers, and it was pretty 

burdensome when you add water and trash pickup and all that on 

there. But we have—I have convinced the legislature last term that 

it would be beneficial for them to pass and grant us to have a half 

percent gross receipts tax that was dedicated to water, wastewater. 

They did that. And that knocked that fee down to about $10. So 

that is more than we need to pay for the plant. But the $10 is 

going to go into a trust fund or savings account, so when the time 

comes for us to update our plan in 2015, We will have some money 

in the bank to do it. 

Mr. OBERSTAR. So you think that that approach is an attractive 

way of creating a dedicated revenue stream on which future— 

which can fund the future investment needs? 

Mr. NUNLEY. That is our plan. 

Mr. OBERSTAR. Secretary Hanger, what do you think about this 

idea? 

Mr. HANGER. Well, it is an attractive idea and, as you are wrestling with, there is no free lunch. Somebody has got to pay to create the fund. And I personally would believe that a small fee, either on existing water and sewer bills or perhaps some other way 

80 

to generate a trust fund that would then address these problems. 

It would be a tremendous return on investment. 

And I think the key is really convincing the American people, at 

least people in Pennsylvania, that the money is dedicated for this 

purpose, and making sure that they see tangible results and get 

tangible results for the dedication. Unfortunately, there is a fair 

amount of skepticism about whether folks get a return on investment. And I think you have to address that very directly. 

Every community has to have a sewer system. Every community 

has to have a water system. Every community, I think, has actually a majority of citizens that understand that we have deferred 

investment in this area too long. And maybe the current economic 

problems of the country caused a little bit of reflection and sort of 

a return to some basics in a number of different ways. And there 

is nothing more basic than this. 

So perhaps this is the time to say a small fee, leveraged across 

the country, put into a trust fund, with a real commitment to excellence in distributing the money and overseeing the money, like 

both of you gentlemen are doing here today, maybe we could get 

that done. It would be a great thing for the future of the country. 

Mr. OBERSTAR. Thank you very much. I think if it were left to 

Mr. Boozman and me, we would get it done probably in an afternoon. But we would get it done. 

Before I hand the mike over to Mr. Boozman, I just want to observe that there are a lot of other needs of this country that can 

be deferred. We can delay this. We can delay the other thing. But 

water, water is essential to life itself. Of all the water, of all the 

million cubic miles of water on the face of the Earth, 3 percent is 

fresh water. Two-thirds of that is locked up in the ice caps. That 

is 1 percent—less than 1 percent fresh water is available in surface 

water. There is some left in the Ogallala Aquifer. There is some left 

in the Jordan Aquifer under the Twin Cities from the last glacier 

of 15,000 years ago. But that is being drawn out. That is being 

withdrawn. When that is out, that 15,000-year-old water is gone; 

it will never be replenished. That is all we have. We cannot poison 

it and hand this onto the next generation. 

Mr. Boozman, take whatever time you—— 

Mr. BOOZMAN. Oh, no. Thank you, Mr. Chairman. I have enjoyed 

the discussion, and the other thing is I really do want to compliment you. I think the Transportation Committee can be very 

proud not only in the area of water resources, but our roads. All 

of the things that we have oversight, that through your leadership 

we really are exercising the oversight. 

We are talking about a lot of money at stake and with the Transportation Committee doing its very best to make sure that that is 

spent wisely is certainly a very, very good thing. And I think that 

we really have been the lead and probably are the model Committee in that regard. So I appreciate your leadership very, very 

much in that regard. 

As I was listening to the user fees, taxes, trust fund, whatever 

you want to call it, and there are different—there are differences 

somewhat in some of those things, and I am not going to argue 

that. One of my concerns, though, is that I see as I sit here—and 

I have really enjoyed this Committee, I have been on it since I have 

81 

been in Congress and now the Ranking Member. But I see a lot of 

uniform—I am sorry—a lack of uniformity in how we administer 

the requirements in different areas. 

I sit here and I hear of areas that are out of compliance 90 days 

out of the year and this and that. Not a lot seems to be happening 

to them. 

You, Mayor Nunley, have the strictest requirement of anybody in 

the Nation. And I can’t believe that there aren’t other areas that 

are every bit as bad as you. In fact, I can’t believe there are a lot 

of areas that are worse. But somehow you have gotten on that list. 

And so my concern is until—and the IG was in the other day and 

testified to that effect— my concern is until we get some uniformity 

and get that straightened out, that as we create these trust funds, 

all we are going to do is have the ability for EPA or whoever to 

rachet down the requirements even more, and you are going to be 

behind the gun again. You are still going to—we are going to be 

spending more time than ever. 

So I really do think we need to make sure that as we make these 

decisions that truly are tremendous unfunded mandates that really 

impact populations, impact growth, impact the economy, that we do 

that; that we make sure that we are doing that in a uniform way, 

and that we make sure that we have got good science behind that. 

So I just have one question for you, Ms. Darcy, and then we can 

adjourn. And this is just kind of something that we have been concerned about now for quite a while. The Congress has received two 

Army Corps of Engineers Chief Reports in 3 years. Are stimulus 

funds being used to complete the Chief reports? Can we expect any 

at the end of 2009? Can we expect any during 2010? 

Ms. DARCY. I know that we currently have some Chief reports in 

the works, and some that are on their way to my office for my signature before the end of this fiscal year— this calendar year, excuse me. 

Mr. BOOZMAN. Okay. So we will go ahead and submit that in 

writing and then maybe you can visit and give us some numbers. 

Ms. DARCY. I will sir. 

Mr. BOOZMAN. Okay. Thank you very much. And I again I thank 

you, the panel, for you being here. This has been a very, very good 

hearing and we appreciate your being here. Thank you, Mr. Chairman. 

Mr. OBERSTAR. At the request of the gentleman from Arkansas, 

it will be submitted to the Committee and included in the Committee record at this point and available to all Members. 

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Mr. OBERSTAR. We appreciate your participating. Secretary 

Hanger, think further about this idea of trust fund and how it 

would be set up, how it would be funded—Mayor Nunley, Mr. 

Gritzuk. 

We are going to be confronting this—we have had a hearing on 

financing of modern wastewater treatment systems this summer. 

We will have an additional hearing on the current idea of an infrastructure bank of some sort or Infrastructure Trust Fund. So give 

us your ideas on revenue source, sustainable revenue stream, the 

distribution of those dollars, how you—what kind of formula you 

could establish to ensure the equitable distribution of those dollars 

as we do the Highway Trust Fund, the Aviation Trust Fund, the 

Inland Waterways Trust Fund. There aren’t very many others. We 

used to have a lot of them. They have all gone their way. 

But there is an urgency and a sense of urgency, of need, to address the problems of clean water, but also an awareness that we 

don’t have available general revenue dollars to sustain these programs, and a rising call from cities, counties, State agencies to develop this revenue stream. 

So help us with your thoughts. We will include them as we prepare for a future hearing on this subject. 

And secretary Darcy, we thank you for your contribution. Ms. 

Gelb from EPA, keep working and keep in mind there are people— 

you are all employed, we are all employed—there are people out 

there who aren’t. Our job is to do two things at once: improve our 

environment, but create jobs for people. 

Mr. OBERSTAR. The Subcommittee is adjourned. 

[Whereupon, at 1:12 p.m., the Subcommittee was adjourned.] 

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