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RECOVERY ACT 225-DAY PROGRESS 

REPORT FOR TRANSPORTATION 

INFRASTRUCTURE INVESTMENT 

(111–66) 

HEARING 

BEFORE THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

October 1, 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) 

(III) 

CONTENTS Page 

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

TESTIMONY 

Cox, Honorable John, Director, Wyoming Transportation Department .............. 42 

Gallagher, Charles, President, Gallagher Asphalt Corporation, representing 

the American Road and Transportation Builders Association ......................... 42 

LaHood, Honorable Ray H., Secretary, U.S. Department of Transportation ..... 7 

Nye, Ward, President, Martin Marietta Materials, representing the National 

Stone, Sand and Gravel Association ................................................................... 42 

Soubry, Paul, President and CEO, New Flyer ...................................................... 42 

Taylor, T. Jeffery, Manager of Transportation, Elkhart County, Indiana .......... 42 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Cohen, Hon. Steve, of Tennessee ............................................................................ 62 

Carnahan, Hon. Russ, of Missouri ......................................................................... 63 

Cummings, Hon. Elijah E., of Maryland ............................................................... 64 

Johnson, Hon. Eddie Bernice, of Texas .................................................................. 68 

Oberstar, Hon. James L., of Minnesota ................................................................. 73 

Rahall, Hon. Nick, of West Virginia ....................................................................... 81 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Cox, Honorable John ............................................................................................... 85 

Gallagher, Charles ................................................................................................... 92 

LaHood, Honorable Ray H. ..................................................................................... 102 

Nye, Ward ................................................................................................................ 117 

Soubry, Paul ............................................................................................................. 123 

Taylor, T. Jeffery ..................................................................................................... 126 

SUBMISSIONS FOR THE RECORD 

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

Chart entitled, ′′T&I Committee Transparency and Accountability Information by States 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 August 31, 2009) ............................................................................................ lxii 

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 Received by 

T&I Committee (Data Reported as of August 31, 2009) Percentage 

of Allocated Funds Associated with Project Stages: Highways and 

Bridges ....................................................................................................... lxix 

Report entitled, ′′The American Recovery and Reinvestment Act of 2009 

Transportation and Infrastructure Provisions Implementation Status 

as of September 18, 2009′′ ........................................................................ xiii 

LaHood, Honorable Ray H., Secretary, U.S. Department of Transportation: ....

Response to question from Rep. Coble, a Representative in Congress 

from the State of North Carolina ............................................................. 20 

Response to question from Rep. Cummings, a Representative in Congress from the State of Maryland ............................................................ 27 

Response to request for information from Rep. Oberstar, a Representative in Congress from the State of Minnesota ........................................ 29 

Response to request for information from Rep. Richardson, a Representative in Congress from the State of California ....................................... 35 

Page

IV 

LaHood, Honorable Ray H., Secretary, U.S. Department of Transportation— 

Continued 

Response to request for information from Rep. Richardson, a Representative in Congress from the State of California ....................................... 37 

′′USDOT TIGER DOT.GOV, Department of Transportation’s Implementation of the American Recovery and Reinvestment Act of 2009,′′ 

powerpoint presentation ........................................................................... 108 

ADDITIONS TO THE RECORD 

American Automobile Association, American Trucking Associations, National 

Association of Manufacturers and the U.S. Chamber of Commerce, Open 

Letter to the President and Congress on Transportation Investment ............. 130 

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(1) 

HEARING ON RECOVERY ACT: 225-DAY 

PROGRESS REPORT FOR TRANSPORTATION 

INFRASTRUCTURE INVESTMENT 

Thursday, October 1, 2009 

HOUSE OF REPRESENTATIVES

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

WASHINGTON, DC. 

The Committee met, pursuant to call, at 9:40 a.m., in Room 

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

Mr. OBERSTAR. Good morning. The Committee on Transportation 

and Infrastructure will come to order, after a very long delay on 

the George Washington Parkway this morning. It is one of those 

moments when sitting in traffic and hearing the radio area traffic 

reports, and I was in the middle of the mess they were talking 

about. Usually they are talking about something somewhere else 

and it doesn’t do you any good. Well, it didn’t me any good either, 

just made me feel better that everybody else was suffering. 

Mr. RAHALL. Where is your bicycle? 

Mr. OBERSTAR. Where is my bicycle, Mr. Rahall wants to know. 

Yes, I could have pedaled in from our townhouse this morning. I 

could have pedaled in in less time than it took me to drive. 

The investments under the Recovery Act have played a very significant role putting Americans back to work. Our Federal agencies, the States, whether it is the State Revolving Loan Funds, the 

Airport authorities, all have shown that they can deliver our funding and the projects that we created in our portion of the stimulus. 

They put people to work and do it within the tight time frames 

that we set forth in the Recovery Act. Although I must say that the 

time frames in the Act are looser than the ones that were reported 

from this Committee and that passed the House; we had a 90-day 

provision. 

The photos you are seeing, especially this one here, is one I took 

with my BlackBerry on a project in Bemidji, Minnesota, where they 

are redoing an entire street and two and a half miles of road that 

goes through neighborhoods and concludes on the main street of 

Bemidji, and they are digging up 100-year-old water lines and 50- 

year-old sewer lines. In another slide you will see the pipe that was 

dug up, rusted, and the new pipe to go in, and all of that shows 

the jobs that have been created both onsite and in the supply chain 

providing materials for the projects. 

Sixty-four percent at the end of August available formula funds 

for highway and transit projects have been put out to bid. Half of 

2 

those were under contract. Forty-two percent were projects underway. 

I committed at the outset of this legislation, in fact, going back 

to January of this year, that we would monitor, we would follow 

the progress and report on those that are successes and those that 

aren’t, and lay it all out so that the public has a clear understanding, and this is the fifth in the series of our hearings. 

Some critics of the Recovery Act complain about red tape obstructing quick and efficient use of funds. But apart from one— 

those pipes are also from the Bemidji project. Note the contrast of 

the old rusted pipe and the new pipe that will go in that will, because of its design and its coatings, both in and out, will last 75 

to 100 years, while that pipe in the foreground is barely 50 years. 

The State DOTs have known from the very outset that this program would entail projects that have been designed, engineered, in 

which right-of-way is acquired, EIS completed, down to final design 

and engineering; that all that was needed by the State was to get 

the funds and put the project out to bid. There was no additional 

paperwork to be done, no permits to be undertaken; all of that had 

already to have been completed. 

There was one issue raised by an engineer in Indiana back in 

July. He said I have an engineer full-time and about all he is doing 

is red tape every day, filling out forms. Well, none of those forms 

were required by Federal Highway Administration; none of those 

forms were required by transit agency or any other Federal Government entity. Those were problems the county engineer had with 

his State DOT, and he will be on the witness panel later this morning to discuss his particular situation. 

The time line has moved very smoothly. When a State selects a 

Recovery Act project, the Federal Highway Administration has approved the project within a day or two. Once that is done, the Federal role is complete; it is then up to the States and their local 

partners to put the funds to work. States, in most cases, have 

moved aggressively to advertise, sign contracts, begin construction. 

We will hear today from one State, Wyoming, that has put nearly 

all of its Recovery Act highway funds to work on the job site. 

Just 10 days after the Recovery Act was signed, our Committee 

requested and insisted on transparency and accountability information directly from States, from the MPOs, from public transit agencies, and they have been reporting regularly to our Committee and 

we have been putting this information on the Web and making it 

publicly available and in our various hearings. 

This is another Recovery Act project. Actually, this one happened 

to be in my district. 

All in all, by the end of August, 8,000-plus highway and transit 

projects in all 50 States, territories, District of Columbia put out 

to bid, $22 billion, that is 64 percent of the total available formula 

funds for highway and transit; 6400-plus projects have actually 

been put under contract, and that totals $16.8 billion; work is underway on nearly 5300 projects in the States, the territories, and 

the District of Columbia totaling over $14 billion. Our most current 

report shows 122,000 direct on-project jobs. That is what we intended this project to do. 

3 

I have heard some complaints and there was a report in a major 

newspaper last week saying, well, these aren’t the best projects, 

these aren’t the big-time projects. That is not what we intended. 

The surface transportation authorization bill is going to do the big 

futuristic projects. These are the backlog projects that State DOTs 

have had on their books for years and every State DOT has told 

me and other Members of this Subcommittee, and said it publicly, 

if only we had the money, we would do these paving projects like 

the one in this photo here. And that is all that this was intended 

to do, put people to do, create jobs, take people off unemployment 

rolls; put them on payrolls; off unemployment checks, giving them 

paychecks. That is what this is all about. 

The rest of my statement I will submit for the record. I just want 

to sum this whole thing up with an experience I had last August 

on one of these construction projects. The foreman called a truck 

over to the side. You have all seen them, those big bottom dump 

haul trucks, doing a mill and overlay. And the driver shut off the 

engine, jumped down and said, oh, Mr. Oberstar, thanks to you and 

the Congress, I am working. 

Two months ago, my husband and I just finished dinner, we were 

sitting there looking at each other across the table asking where 

do we go now? Our unemployment compensation is gone; our 

health insurance has ended; we are drawing down what little we 

have in savings to pay the mortgage. How are we going to put the 

two boys into summer camp this year? Where do we go from here? 

And then the next week our employer, Knife River Construction, 

called and said we won the bid for repaving of I-35; report to work 

next week. And now we are off our unemployment and we are now 

getting a paycheck; and we are now paying our mortgage; and we 

have paid taxes, our Federal and State taxes; and, yes, the boys are 

going to summer sports camp. 

Real people, real jobs, real lives put back together. 

Mr. Mica? 

Mr. MICA. I thank you for yielding and also want to associate 

myself with your remarks. The most important thing we can do is 

get people working, and what a difference it does make in their 

lives. 

I am so pleased to see Secretary, our former colleague, Mr. 

LaHood, with us today. He has certainly done a great job in trying 

to join us with our intent of getting funds out. And I know he has 

done everything possible, humanly possible and then some, to try 

to make certain that transportation infrastructure money gets out 

there and people are employed and we hear more of the stories like 

Mr. Oberstar just relayed to us. 

Unfortunately, we still have problems in getting the money out, 

and this isn’t something that should be a surprise. In fact, I had 

some CBO language or, actually, this particular article cites back 

some of CBO’s projections. Unfortunately, when they told Mr. 

Oberstar and myself that there would be difficulty in getting that 

money out and that we would only be able to get out certain percentages, unfortunately, they were right, and have been right, because it is difficult. 

I think when we passed at least our portion of the stimulus bill, 

and you have to remember, out of $787 billion, less than 7 percent 

4 

was transportation and infrastructure-related, and of that, the Secretary, through DOT, has about $48 billion that he is responsible 

for, and we have tracked each of the agencies, and we tried to put 

in place protections to make certain the money was properly accounted for, and these hearings are something we also pledged to 

do to monitor how those funds are going out and keep good tabs, 

as trustees of the taxpayers’ hard-earned dollars, where that money 

goes. So it has been a difficult process. 

The Chairman also cited that all the problem in the delays is not 

the Federal Government, although I would like to do a lot more in 

expediting the red tape and the hoops and all the delays like the 

bridge in Minneapolis. I think normally that would have taken 

seven to eight years to replace. That was done in 437 days. So we 

can target projects and we can get people working in significant infrastructure investment projects, but we do have a ways to go. 

Now, interestingly enough, when we started looking at the hearing today, we have the unemployment for the 10 States and the 

amount of infrastructure DOT spending, and I looked at this. This 

is the latest information. Remember, I do these charts. I did the 

chart, I think the first one, with the end of May statistics and I 

thought, well, let’s see how our improvement is. 

Now, some of these States have changed a bit as far as who has 

the highest unemployment, but most of them are still with high unemployment figures. And you can see Michigan up here now has 

15.2 percent; at the end of May, the beginning of June, the unemployment was 14.1 percent. So it has actually risen with this 

amount of spending. 

Actually, in every one of these, with the exception of South Carolina, unemployment has either risen—even with the stimulus 

money, unemployment has risen or remained the same in all of 

them except for South Carolina. South Carolina we spent the least 

amount of money, $6.9 million, and that is the only one where unemployment actually dropped. So I don’t think this chart shows 

that what w e have invested has made—at least the transportation 

and infrastructure spending has made a difference in employment 

figures. 

That does raise concerns, and maybe we should work together in 

targeting some of these high unemployment States. It is ironic the 

one that got the least amount of money had half a percentage decrease in unemployment. It doesn’t quite make sense. So I think 

what we should do is look at targeting some of the high unemployment areas and see how we can work with them to do some Minneapolis bridge type projects, major infrastructure projects that we 

know are pending. 

Now, my State has come a long way. And some of the assessment, too, has been critical of the way money has been spent. I had 

a hearing, too. My State was targeted for being 51st out of I think 

51 States and the District of Columbia of getting the money out. 

But when we looked at how they were approaching it, it wasn’t just 

short-term small projects, it was longer term investment, which is 

also important in that analysis. 

But I do think we have an obligation to try to get, as the Chairman pointed out in his illustration of that one family, more of those 

families working so they are not losing their homes, they are not 

5 

on unemployment, they are not losing their health insurance, they 

are able to send their kids to school and do the other things that 

they want to do. 

So I look forward to working with the Administration. I think 

maybe we might want to look at targeting, see how we can get 

those bucks out there to the high unemployment areas and do an 

even better job. We do have that obligation and I look forward to 

working with you, Mr. Chairman, Mr. Secretary, and yield back. 

Mr. OBERSTAR. Thank you, Mr. Mica. 

Your charts are very interesting and yet I think while they raise 

a point, your advocacy for more investment in areas of greatest 

need is provided for and required in the Act, it was something that 

I particularly insisted on, even though, in the conference between 

the House and Senate, there was push-back from the other body. 

Our language in the House bill to require States to give highest 

priority consideration for allocation of highway, water resource 

funding, transit funding to areas of highest unemployment as 

measured by EDA, the Federal Economic Development Administration, remained in the bill. 

In my State of Minnesota, 40 percent of the funds went to the 

areas of highest employment. Thirty-four percent of those are actually underway. In Florida, 35 percent of the State’s $201 million allocated went to areas of highest unemployment. That, in fact, requirement is being carried out. 

In our surface transportation authorization bill we are taking in 

serious account the Minneapolis bridge reconstruction that you frequently cited, the 437-day wonder, and our Office of Project Expediting in the Federal Highway Administration is going to take the 

lessons learned from the Minneapolis bridge and apply them nationally. But we have to move, and with that continued participation we are going to get there. 

Mr. MICA. Mr. Chairman, will you just yield? 

Mr. OBERSTAR. Yes, I yield to the gentleman. 

Mr. MICA. A kind of sad day today. Today is the first day I can 

remember in 18 years that we have not had in place an extension 

of our highway reauthorization. I know we did 13 extensions, but 

we never missed the mark. I guess the other body had a bad night 

last night; the last email I got was 7:25, and they had reached an 

impasse. But hopefully we can get the reauthorization extension 

done. But this is the first time I ever remember, in my legislative 

career, a short 17 years, 18 years, of not having that done. 

Mr. OBERSTAR. The Senate has had that bill for a week. They 

were unhappy that I pointed that out yesterday. And when the 

Chair of the Senate Committee, Ms. Boxer and Mr. Inhofe, tried to 

move their bill, a Member of the other party objected. I don’t know 

who it was, but all it takes is one to object in that body and you 

are right, it is the first time in a long time we haven’t been able 

to get an extension, although it is covered in the CR. 

Do other Members wish to be heard? 

Mr. RAHALL. Mr. Chairman? 

Mr. OBERSTAR. Yes. 

Mr. RAHALL. Mr. Chairman, I just ask unanimous consent that 

my opening statement be made part of the record so that we can 

proceed to the Secretary. 

6 

Mr. OBERSTAR. Without objection, so ordered. 

Mr. RAHALL. I will be asking some questions in regard to the 

TIGER grants, the discretionary grant program. But I certainly 

want to welcome our dear friend and still dear colleague I like to 

call him, Ray LaHood, who I think has done an excellent job as our 

Secretary of Transportation. He certainly has reached across party 

lines, continued to reach across party lines, as he did while in this 

body, and certainly want to welcome Ray and thank him for the 

tremendous job he is doing for our Country. 

Mr. OBERSTAR. Mrs. Miller? 

Mrs. MILLER. Thank you for recognizing me, Mr. Chairman. I 

will just be one quick minute. But since Michigan was raised, if I 

could, we do have the highest unemployment in the Nation. In fact, 

in the four counties that I represent, the average unemployment 

rate is 19 percent. We do have a shovel-ready project immediately 

in Southeast Michigan, and I have talked to the Secretary about 

it and the Chairman and Ranking Member as well, and that is the 

Blue Water Bridge, which is shovel-ready. 

And it is not like it is some local project, it is the second busiest 

commercial artery on the northern tier of our Nation. I have raised 

this issue with Prime Minister Harper, as well as the Chairman 

did, a week ago. We look at Canada as our biggest trading partner 

and their principal priority, really, is making sure that we continue 

to expedite the flow of goods between our two Nations. This is the 

genesis of I-94, and I-69 is right at the foot of that bridge. It is a 

major project, as I say, for all of the right reasons, and in that particular city the unemployment is 26 percent right now. 

So I have to put a plug in for that because I think it is—I am 

not trying to hawk some local project. This is a huge project of national significance, shovel ready. I know you do have some discretionary funds in the stimulus funds and, Mr. Secretary, I would 

ask you to look at that again, if you would. 

Thank you very much, Mr. Chairman. 

Mr. OBERSTAR. Mr. Secretary, thank you for being with us. 

Thank you for your very thorough report, including the attachment, as we asked you to do, on projects in economically distressed 

areas. I would like to join Mr. Rahall in complimenting you in your 

service as Secretary. You learned well in this Committee. You 

didn’t stay long enough, you went over to Appropriations, but you 

have done a superb job as Secretary 

And I want to compliment you on your most recent initiative on 

using cell phones and texting while driving. You know, in the European Union, such activity is outlawed by their departments of 

transportation. In Portugal it is a crime to text while driving. 

Thank you for your report. The floor is yours. 

Mr. EHLERS. Mr. Chairman? 

Mr. OBERSTAR. Oh, excuse me. Just a moment. Mr. Ehlers wishes to be recognized. 

Mr. EHLERS. I apologize for being late, but I was in another 

meeting. 

I just wanted to add to the comments that Congresswoman Miller made. First of all, I want to compliment you, Mr. Secretary. I 

have heard you on the radio. I don’t have time to watch TV, but 

I have heard you on the radio more than any other Secretary. And 

7 

I am not saying that in a derogatory fashion; that just means you 

are getting out there to the public, and I think that is a very important role for any Secretary to have, to explain to the public 

what is going on and why it is going on, and I appreciate your active role in communicating to the people of this Country. 

The other comment I want to make is we have people on our side 

of the aisle who are keeping a list of all the stupid things money 

is being spent for in the stimulus package, and I don’t get into that 

game, but I do want to second what Congresswoman Miller has 

said. I really expected, when this all started, that a lot of the 

money would be going to shovel-ready projects. 

And I have seen the list of shovel-ready projects. Not much 

money seems to be going there and a fair amount of money seems 

to be going to certainly less needed projects. And people wouldn’t 

be able to keep these lists if it weren’t going to less worthy projects. 

I am not talking so much about in your Department, but I think 

your Department doesn’t seem to be getting the amount of money 

it needs to deal with all the shovel-ready projects that are sitting 

there, and you just heard one example this morning. 

So I would hope that you can carry the message back to the 

other folks that you have a lot of work ready to go. Unemployment 

is huge in this Country, especially in Michigan. We are about 15.3 

percent now, and we can put that money to work right away. So 

keep up the good job and carry the message back, please. Thank 

you. 

Mr. OBERSTAR. Mr. Ehlers, for the record, and Mrs. Miller, according to the report that we have received, our most up to date 

report on projects in economically distressed areas, 90 percent of 

Michigan’s population is recorded as being in an economically distressed areas, measured by EDA, according to the law that we 

passed; and 87 percent of the projects reported from the State of 

Michigan DOT have been designated to areas of high unemployment. If you take issue with that, then we will have to have Michigan DOT come in here and explain to us what they mean by those 

numbers, and we will do that. 

Mr. EHLERS. Yes. And we met just a week or two ago with the 

Director of Transportation Department in Michigan and they are 

really getting the money out there and doing their best to do it. A 

big problem, of course, for the State, the whole State is so economically distressed that they don’t have the matching money that is 

needed on a number of these projects. 

Mr. OBERSTAR. That is another problem. We will expect to hear 

from Secretary LaHood about that. 

Mr. EHLERS. Yes, right. So thank you for raising that issue. I am 

not economically distressed, but I am certainly mentally distressed 

at what I see in my State in terms of the problems of the people. 

Mr. OBERSTAR. Mr. Secretary. 

TESTIMONY OF THE HONORABLE RAY H. LAHOOD, 

SECRETARY, U.S. DEPARTMENT OF TRANSPORTATION 

Secretary LAHOOD. Mr. Chairman, thank you for inviting me to 

participate in this hearing. It is good to be back with you and your 

colleagues, and good to be back at the Transportation Committee, 

where I started my congressional service. I want to talk about the 

8 

progress in implementing the American Recovery and Reinvestment Act. 

Last April I appeared before this Committee to share our initial 

efforts to get Recovery Act funds out the door to support transportation projects across the country, and I am pleased to report we 

have come a very long way since then. 

I want to recognize two career people at the Department of 

Transportation who are with me today, Lana Hurdle and Joel 

Szabat. They, from the very beginning, put together what we call 

the TIGER team, which is made up of all the different modes, 

when we realized that we would be receiving these funds, $48 billion, and that you all put very strict guidelines on getting money 

out the door. They organized a committee within the Department 

and they have done a wonderful job, every week, holding people’s 

feet to the fire to make sure the money is being spent correctly. 

So to both of them I want to say thanks for doing what they have 

done to do it the right way. Thank you. 

[Applause.] 

Mr. OBERSTAR. We all know that good Member work is backed 

up by good staff work. 

Secretary LAHOOD. That is correct. 

Today, we are nearly at the halfway point of this historic effort. The DOT has obligated $29.4 billion, over 60 percent of our total 

Recovery Act funds, on over 9,000 projects nationwide. To date, almost $3.4 billion has been disbursed from the U.S. Treasury. And 

let me give you the top line numbers. The FAA has obligated 99 

percent of its recovery money; the Federal Highway Administration 

has obligated 72 percent; the Federal Transit Administration, 88 

percent; and the Maritime Administration 100 percent. This represents substantial progress. Both the DOT and our State and local 

partners share in this success. 

The other good news is that we have met or exceeded all the Recovery Act deadlines, and have done so without any boondoggle, 

sweetheart deals, or earmarks; and we are very proud of that. 

Since the passage of the Recovery Act, I have personally visited 

30 States, 54 cities, and have seen the positive impact, as you have, 

Mr. Chairman, these resources are making in our communities. 

Throughout all of these visits, one thing stays the same: I have yet 

to hear a complaint from anyone. The largest portion of the Recovery Act dollars are working to improve our highways and bridges; 

$19.4 billion have been authorized to support work on nearly 8,000 

projects in all 50 States and U.S. territories. Of that amount, more 

than half, 59 percent, are obligated on projects located in economically distressed areas, where communities have been hardest hit by 

the recession. 

For example, the widening of Interstate 215 in San Bernardino, 

California, will help one of America’s most economically distressed 

areas by creating jobs for 2,000 workers in the first year. It will 

also improve access to one of the largest and fastest growing trading hubs in the San Bernardino International Airport. 

On the transit side, the Federal Transit Administration has 

worked with nearly 600 transit agencies nationwide to ensure that 

half of their share of Recovery Funds would be awarded by September 1st. FTA exceeded this deadline and to date has awarded 

9 

683 grants. These funds have been a lifeline to the industry, enabling transit agencies to replace aging equipment, improve safety 

and reliability, and reduce emissions. 

More broadly, Recovery Act funds have been instrumental in restoring transit service hurt by budget cuts. For example, with the 

aid of the budget stabilization funds, the State of Missouri was able 

to provide $12 million in emergency relief to the St. Louis Metro, 

which in turn rehired over 250 employees and restored a significant portion of transit service. We have also broken new ground in 

helping public transportation become more environmentally sustainable. Last week we awarded $100 million in grants to 43 transit agencies focused on reducing greenhouse gases and fuel consumption, and we have received many more innovative proposals. 

The recipient of the largest award, Atlanta’s Metropolitan Atlanta Rapid Transit Authority, is using the funds to provide bus 

canopies with solar paneled roofs in a bus maintenance facility. 

These green roofs will produce power that feeds into Atlanta’s 

power grid and MARTA can generate new revenue by selling surplus electricity back to the utility. 

In aviation, the Federal Aviation Administration has awarded 

$1.1 billion for over 300 airport improvement grants to upgrade 

and improve runways and airport facilities. Most of these high-priority projects are under construction or completed. Airports are 

also benefitting from the Recovery Act provision encouraging the 

use of private activity bonds to finance debt and save money. Over 

two dozen airports have taken advantage of this program, selling 

more than $4 billion worth of bonds and saving hundreds of millions of dollars they can redirect toward long-term development 

costs. 

In the maritime sector, the Maritime Administration Small Ship- yards Program has awarded $98 million to 70 small projects in 26 

States and Guam. These funds make significant and, in some 

cases, long overdue repairs and upgrades to dry dock facilities, 

steel working machinery, and other infrastructure. 

As you know, one of the signature initiatives of the Recovery Act 

is $8 billion to help jump start high speed and inter city rail. The 

Federal Railroad Administration is reviewing over 200 applications 

it has received so far, with additional applications due this week. 

There is a tremendous amount of interest in this program across 

the Country, and we are grateful to Congress for their support. 

FRA did a great job reaching out to stakeholders. 

One other signature initiative, the $1.5 billion discretionary 

award program, is known as the TIGER Grant program. We are 

seeking innovative, multi-modal projects of regional and national 

significance. The response has been tremendous, with about 1,400 

applications submitted from all 50 States and the District of Columbia and three territories. We will announce these awards in advance of the February 2010 deadline. We think that, taken together, these innovative cross-cutting programs will, over time, 

produce a profound strategic shift in our transportation capabilities, with far greater emphasis on efficiency and sustainability 

than the Country has seen in more than half a century. 

Finally, I want to note the tremendous positive impact of the Car 

Allowance Rebate System, known as Cash for Clunkers. Like the 

10 

Recovery Act, this program has really helped to move the dial during the recession. A total of 694,877 cars were sold from 21,208 

automobile dealers across America. So far, we have paid out more 

than $2.8 billion in rebates, with an additional 7,000 applications 

worth $28 million in final review. 

Thanks in part to this innovative program, consumer spending 

posted a solid gain in the third quarter. Ford, GM, Toyota, and 

Honda announced quarterly production increases, which are putting more people back to work, and through trade-ins we have 

achieved a 60 percent improvement in fuel economy. I think the 

CARS program, which was wildly successful, and the Recovery Act 

clearly demonstrate that when the Federal Government, State and 

local leaders, and the private sector team up to take bold actions, 

the American public wins. Together we are putting America back 

to work. 

I look forward to your questions, Mr. Chairman. 

Mr. OBERSTAR. That is a splendid report. I read it last night and 

again this morning. I am very encouraged by what I saw, some of 

these additional details that you have supplied in your testimony 

to those that we have been tracking with our Committee documentation. 

On the CARS, I didn’t know that is what its acronym was; I 

thought it was simply Cash for Clunkers. 

Secretary LAHOOD. Well, that is the way it was portrayed by 

some, but the acronym is CARS. 

Mr. OBERSTAR. CARS. I queried our State of Minnesota about the 

effect of CARS and found that the State has registered a 1.5 percent increase in tax receipts because of car sales that had disappeared and now had come back. Not only tax benefits up, but car 

registration fees are up and license fees are up, and a whole host 

of such fees that are derived from the automobile sales sector benefitted dramatically in the month of August and September in the 

State of Minnesota. 

In February, after we passed the stimulus bill, I was asked by 

Minnesota news media and other national news media when will 

we see the effects. Well, there will be effects by May and June as 

contracts are awarded, work starts, and the States begin paying 

contractors and the Federal Government reimburses the States. 

But we in Northern Minnesota won’t feel the effect until November, even December, because there is still a huge amount of steel 

inventory that is in steel company yards and in steel shaping industry yards, those that process steel for pipe and other purposes. 

But as those inventories are drawn down, the industry will have 

new orders and will have to melt those steel, and that will mean 

new iron ore. 

Well, it has actually happened earlier. Two weeks ago, three 

weeks ago, actually, the U.S. Steel, Cleveland Cliffs Mining Company, and another smaller operation have called back 4,000 laidoff iron ore miners in Minnesota, and they have called back another 1500 in the upper peninsula of Michigan, which has two iron 

ore mines; they have been combined into one, the Empire and 

Tilden Mines. That additionally means that the lakers are operating, the ships that haul the iron ore, 1,000-footers that carry 

60,000 tons of ore, called back their crews. So 10 ships in the Great 

11 

Lakes fleet, that is 300 seafarers have also been called back to 

work to haul the ore that we are now mining again, that had not 

been mined all summer and all spring, all since last December the 

mines were shutting down and laying off. 

It is happening faster than I anticipated because this Recovery 

Act money is getting out fast, as fast as we expected. 

You mentioned you have been to 30 States and 54 cities. It occurred to me, hearing you tell that story, how much traveling you 

can do if you don’t have to report for votes on the House Floor. Big 

relief for you. 

I found that airport authorities are able to get their projects out 

faster than the State DOT. I asked the Bemidji Airport Authority, 

the Brainard Airport Authority, Chisholm-Hibbing Airport Authority why were they able to get their funds out so quickly. They have 

a different contracting capability and different requirements than 

do States. They can prepare bids, issue the bids and take bids from 

contractors, and then hold those bids for even a year; and as soon 

as the money is available they can get right out into the field. 

Are you aware of those contractual distinctions? 

Secretary LAHOOD. Well, I think one of the reasons that the airports have done so well is because they have had these projects 

that were ready to go and they haven’t had to really interface with 

that level of bureaucracy at the State level. I mean, our people 

work directly with the airports, they submit their applications, we 

check the boxes, and the project is on its way. 

Mr. OBERSTAR. There certainly are some distinctions in contracting authority between airports and State DOTs. The experience of the alternative minimum tax, which initially I didn’t think 

was going to have much of an effect, you report as having a very 

substantial effect of selling $5 billion in bonds, $4 billion of which 

benefitted from the AMT provisions. Is there a lesson to be learned 

in this experience for us as we go forward with surface transportation program? 

Secretary LAHOOD. Well, I think that this has been a lifeline for 

airports, it really has, financially, and I hope that you will consider 

the use of this opportunity in the future. 

Mr. OBERSTAR. Well, I would like you to have your staff give 

some further thought to the AMT. I don’t know how broadly we can 

spread this and what budgetary consequences there may be in the 

future of expanding that provision. We might have to have offsets 

and PAYGOs and so forth, but, because of this very significant experience, I would like to have your staff give this further thought 

and share with us on both the Democrat and Republican side to 

perhaps inspire some further improvements in our metropolitan 

mobility centers and in the future financing of the surface transportation program. 

Secretary LAHOOD. We will do it. 

Mr. OBERSTAR. A concern that has come up is that States and 

cities, because of drop-off in revenue, have not been able to provide 

the matching funds for the transit projects and, on the highway 

side, some States, it is reported, have cut back on their regular— 

not on stimulus; that is 100 percent Federal funding, there is no 

State match required, but that there have been some reductions in 

12 

State regular program highway and bridge projects, but also on the 

transit side. Are you following those? 

Secretary LAHOOD. Well, as you know, Mr. Chairman, and you 

just stated, there is no match for economic recovery funds. The 

transit money, the $8 billion, almost all of it is out the door. There 

was no match required on that. And the other thing that has been 

a big assist to the transit districts is the provision that was put 

into the omnibus appropriation that allows them to take up to 10 

percent and use it for operating costs. That has been very helpful. 

Every transit district that I have talked to, that has been a lifeline 

for them to be able to use that money to operate. It is one thing 

to say we are going to sell buses and they are going to buy buses, 

but if you don’t have the people to drive the buses, it is kind of 

silly. That has been a good provision and I know that you all are 

considering that in the future. 

Mr. OBERSTAR. Yes, we are. What I am getting at is that there 

is a distinction in the news reporting that is not being made—there 

is a distinction that is not being made in the news reporting is a 

better way to say it—which is that the cutbacks by, for example, 

City of Chicago and a few others, have been in their regular program, not in stimulus program, bus acquisitions. Because they 

have not had the revenue coming in that they anticipate from their 

sales tax or other source for capital asset acquisition, they have cut 

back on the non-stimulus program, while going ahead with stimulus funding purchases, which may in some cases—— 

Secretary LAHOOD. No, that is true. I was just in Chicago; I met 

with Mr. Richard Rodriguez, and he told me—and the mayor was 

also there—that they are having some great difficulty, and it is 

true in other places in the country also, because ridership is down, 

there is a great reluctance to raise the fees during these hard economic times, and they are facing some financial difficulties. 

Mr. OBERSTAR. One last point, for the moment, at any rate, is 

that when we were shaping the stimulus in December of 2008, I 

gathered the representatives of the various organizations, the AGC 

and AASHTO, ARTBA and a number of the State transportation 

directors in Washington, then I further had a conference call, teleconference by TV with the five representative DOT commissioners 

and asked them to follow up with Federal Highway Administration 

on clearing out any obstacles or any questions that they might 

have about implementation, because I said this stimulus program 

is going to pass, it has the support of the President Elect and we 

intend to move it. 

Late in December and early January, Federal Highway Administration and Federal Transit were in touch with State DOTs and 

MPOs and State transit agencies, and after you were sworn in, I 

know you directed even further contacts. Now, that should have 

cleared out any of this question about red tape and made clear to 

States what was expected of them and what they needed to do and 

how to proceed with respect to equitable distribution of projects 

throughout a State, priority given to areas of highest unemployment, and clearing out. The report that I got back from AASHTO 

was we are very happy, we don’t see any problems. 

13 

Now, have you continued to keep the liaison—not you, but I 

mean the Federal Highway Administration, keep the liaison with 

State DOTs throughout this process? 

Secretary LAHOOD. Absolutely. Victor Mendez has been all over 

the country and he is in touch with these folks on a daily basis, 

and I think we do have our finger on the pulse on this. 

Mr. OBERSTAR. Thank you. 

Mr. Mica. 

Mr. MICA. Thank you. 

Again, welcome back, Mr. Secretary. Good to have you here. 

Tomorrow, I am told that the unemployment figures for the Nation might reach 9.8 percent. I actually presented earlier, in my 

opening statement, a chart that showed the 10 highest unemployment States right now, where we put money in. I actually went 

back and got the first charts we did when we did the first review 

hearing and found that nearly all of them had either stayed the 

same or increased, except for South Carolina, where we had the 

smallest amount of money and actually that had a half a percent 

decrease in this. 

The stimulus bill, too, if you go back and look at the arguments 

to sell it, was sold as an infrastructure bill. Of course, there was 

only a small amount in there as it ended up. But they targeted 8 

percent, keeping unemployment at 8 percent. 

I think, Mr. Oberstar, you cited 122,000 jobs created. 

Mr. Secretary, our intent was, if we just use round figures, the 

whole intent of the stimulus was to get people working and jobs 

created, keep the unemployment below the 8 percent level, and we 

still have had difficulty getting that money out and targeted to 

where we have the high unemployment, even though that is a requirement in the bill and you have done your best to get it out 

there. 

If we had the full 60—we will just round it off, we will say $60 

billion out and you get 28 to 34,000—and we will round that out, 

to 30,000 jobs per billion dollars in infrastructure investment, we 

would have 1.8 million people working. So far we have actually 

spent out $3.5 billion, which is right on target; $3.5 billion is about 

122,000 jobs. A long entry into my question, but how can we work 

with you? Do we need to go back and change the law? Do we need 

to do something administratively differently to get the money out, 

to get people working? Do you have a recommendation? 

Secretary LAHOOD. Well, what I would say is that we followed 

every guideline that Congress established in the law. The money 

is out the door. We have to make sure that the States are providing 

the correct information. But the other part of it, too, is that this 

is an 18-month program. A year from now, many of these projects 

will still be going on, at least half of them will, and the people that 

will be suspended from working because of the winter will be back 

at it next year, finishing up these projects. 

Mr. MICA. That is another problem we haven’t even gotten into. 

And being from Florida, we don’t think much about that, but in the 

north you lose months because you can’t construct. So it probably 

will get worse, rather than better, as far as unemployment based 

on that factor alone. Then, of course, if you take States like MichiVerDate Aug 31 2005 10:49 Dec 23, 2009 Jkt 000000 PO 00000 Frm 00083 Fmt 6633 Sfmt 6633 P:\DOCS\52650 JASON
14 

gan, which are in the frost freeze belt, will probably be even harder 

hit. 

Again, if you come up with anything or we could sit down, I 

know Mr. Oberstar would welcome the opportunity, to see how we 

can target getting more money out. Obligated, we have—what is 

it?—$29 billion of the $48 billion that you have control over obligated. When do you think the balance that would all be done by 

the 18 months or do you think that we will have residual and that 

the Committee or Congress would have to come back and do a 

stimulus 2 or—— 

Secretary LAHOOD. I think we will spend all the money that we 

have. 

Mr. MICA. You do? 

Secretary LAHOOD. Yes, I do. 

Mr. MICA. What about a stimulus 2, you think that is necessary? 

Secretary LAHOOD. I will leave that to all of you to decide. 

Mr. MICA. Very good answer on that one. 

[Laughter.] 

Mr. OBERSTAR. That’s the six-year bill. 

Mr. MICA. It is nice for him to be on that side of the—— 

Mr. OBERSTAR. That is the six-year bill. Stimulus 2 is the sixyear bill. 

Mr. MICA. But we will not doing good on that. 

Mr. OBERSTAR. Well, we had a good vote last week. 

Secretary LAHOOD. I would say this, Mr. Mica. If we could get 

your support on a stimulus 2, I think there would be very strong 

consideration for it. 

Mr. MICA. Well, if it was factored right. I mean, Mr. Oberstar 

and I came back. The Speaker asked us to come back, you called 

me and said we have to go back and do some hearings. Was it just 

before the election or after the election? 

Mr. OBERSTAR. October. 

Mr. MICA. October, to do a larger bill. We wanted to do $120 billion to $150 billion, and we could have done it. Then we got the 

kickback from CBO which said you can’t spend it, and again I said 

their words, unfortunately, and their counsel to us was that there 

would be difficulty in getting the money out, and it has proven correct. Not all by what we put in the legislation. We wanted good reporting and be good stewards of the taxpayers’ money, but just the 

practicality of the 50 States plus the District and others trying to 

get the money out under their requirements and things like the 

weather now that will deal us probably another setback. But my 

interest and your interest, I think, is getting the money out and 

getting people working, so we do want to work with you. 

And then sometimes we get the money out with good intentions. 

I have a report here. When Vice President Biden went to Minnesota to a factory, the New Flyer Bus factory, we gave $8.4—well, 

we have $8.4 billion in the stimulus bill, which you have gotten 

money out. They were a recipient of money, stimulus money, I understand, and last month the company—in fact, the Vice President 

said this is an example of the future, and last month that company 

that was a recipient of some of our money laid off 320 people, 13 

percent of its workforce, after getting the stimulus money. 

15 

Now, I know that there are factors, State cutbacks and other 

things, that influence that, but what I am trying to say is we have 

a challenge not only of getting the money out faster, we have a 

challenge of also trying to target the money to where we can secure 

jobs; and I hope that is not an example of the future where, again, 

additional people were laid off but we made a Federal investment 

in that particular operation. 

Is there anything that we should be doing to further examine 

where we are putting those monies? 

Secretary LAHOOD. Well, I have been all over the country, and 

everywhere I go where I see orange cones and orange barrels; I see 

people working; and when I talk to those people, those people were 

on unemployment in January, February, and March, and they are 

now working in good paying jobs. 

Look, if you are going to try and lay off all of the unemployment 

on the fact that we didn’t have enough money or we are not spending it fast enough, I think that is just not accurate. It was a $787 

billion bill. I think when you look at our portion of the economic 

recovery, a lot of people are working around America. Travel 

around your communities, look at the orange cones, look at the orange barrels. Fly into any airport that I have flown into; they are 

all resurfacing their runways. A lot of money out the door and—— 

Mr. MICA. Well, my question, actually, was to the quality of the 

investment. Our intent here was to create more jobs for this bus 

company. It was producing green buses and we made a Federal 

commitment, but they have reduced their employment. I mean, I 

can take my own district. You got money out to Central Florida 

and my transit company is building bus shelters. The bus shelters 

are $25,000 to $26,000 apiece. I mean, I have a question about that 

much money for a bus shelter. That is another question. 

But my point is we are spending money and some people are 

working. Obviously, we haven’t made an impact in the highest unemployment States. But the quality of the investment and getting 

jobs in the future with that investment and sound investments, do 

we need to do more as far as oversight adjustment of the legislation? Or if we are going to do a future bill, how do we protect that 

money going out? 

Secretary LAHOOD. I think in the construction industry, Mr. 

Mica, we have made a huge impact. And if you look at the unemployment in the construction industry, there are a lot of people 

working that without the recovery plan would not be working. With 

respect to whether your transit district ought to be building bus 

shelters or bus buildings, that is up to them to decide; it met our 

guidelines and it met the guidelines set out by Congress. 

If we got in the business of telling every transit district whether 

they can buy buses or build shelters or whatever, you all would be 

screaming at us. They follow their guidelines. And whoever built 

that bus shelter was probably a building trades worker, or two or 

three or four or five that were on unemployment earlier this year 

as a result of a lousy economy, and they were working on the selected project. So that part of it works. 

I think if you look at statistics having to do with our portion of 

economic recovery, we are driving down unemployment and a lot 

16 

of people are working in good paying jobs, and that will continue 

through the life of the program. 

Mr. MICA. Well, we look forward to working with you both and 

getting the money out, getting people working, and then making 

certain that the money that we spend goes on good projects that 

are spent with the best interest of the taxpayer in mind. Thank 

you. 

Mr. OBERSTAR. Mr. Mica raised an interesting point that I discussed somewhat with you earlier, the issue of New Flyer and the 

City of Chicago was called to my attention by the officials at New 

Flyer about three, four weeks ago, who were very concerned that 

their order of 150 buses from the Chicago Transit Authority was 

being, at that time, reduced and then put on hold. They were anxious. This was not stimulus money; the buses the CTA ordered 

from New Flyer under stimulus was a firm order, and they are proceeding with that order. 

But at the very same time—and the reason I raised this earlier 

was the same Chicago Transit Authority was cutting back. Why? 

So I called Frank Kruesi, who is the aide to the mayor and directed 

the Chicago Transit Authority for some years, and asked, and he 

came back with a report that their revenues had fallen; their sales 

tax revenues were down; the source of funding for bus acquisition, 

capital acquisition was down. The city could not carry out their intention to order 144 buses and put those bus orders on hold. 

As a result, New Flyer had to cut back its employment because 

they had ramped up in anticipation of this order from the Chicago 

Transit Authority. Chicago, too, is a victim of recession; their tourism dollars are down, the travel figures are down, O’Hare’s numbers are down, train traffic is not as congested in the center of Chicago as it once was. I think the railroad companies would like to 

have that congestion back because it means that their shipments 

are down. Everything is down. 

The only thing that is up is the stimulus money, and all of the 

funds are going out according to plan, but we did not, in the stimulus program, direct States as to the type of project to be done or 

the quality of the project, or what its long-term benefit would be, 

but, rather, whether it would create employment. And the second 

directive we had was that the States allocate those funds on a priority basis to the areas of highest unemployment. That too is being 

done. 

Now, I will say to my good friend, Mr. Mica, that in our surface 

transportation assistance bill that we have reported from Subcommittee, we take a very significant step toward quality of 

projects in the future by requiring States—first of all, compressing 

the 108 categories of Federal Highway funding into four formula 

programs, eliminating 75 of them, and requiring the States to develop six-year strategic investment plans, something that you and 

I talked a great deal about and we are in agreement on. And initially the State DOTs said, oh, that is a great idea. Then they said, 

well, we don’t like so much accountability, and they are nervous 

about it. 

But this is how we are going to achieve quality projects, longterm planning, coordination within the State, between State DOTs 

and Federal Highway Administration and USDOT and get better 

17 

projects in the long run and concentrate the States’ efforts. That 

is where—and we can do further refinements to make those stronger, and we have learned some lessons through the Recovery Act, so 

we are proceeding, things are going. Also, CBO was flat out wrong; 

they said this program would spend out at only 2.4 percent. They 

were dead wrong; it spent out at 64 percent. 

Mr. Rahall. 

Secretary LAHOOD. Mr. Chairman, before Mr. Rahall, I thank 

you for the clarification. I was with the Vice President when he 

went to New Flyer, and I want to make sure everybody knows New 

Flyer is a very good company. It is a very well run company. And 

through no fault of their own, Chicago decided to cancel their contract for 150 buses. Now, they can’t do anything about that, but I 

want to make sure the record is correct on this. This is a very fine 

American company. And what we are asking these transit districts 

to do is look to American companies to buy their buses. So we are 

happy that companies like New Flyer are in existence and run 

well. 

Mr. OBERSTAR. Their employment has increased 40 percent because of recovery, even with this layoff. 

Mr. Rahall. 

Mr. RAHALL. Thank you, Mr. Chairman. I would like to shift the 

questioning to rural parts of our Country, an area from whence the 

Secretary comes and knows very well. 

That, of course, brings up the TIGER grants that you mentioned 

in your opening testimony, and I know you have your evaluation 

team with you that you have introduced to the Committee already. 

When the grants funding announcement was made back in June in 

the Federal Register, the announcement mentioned the DOT ‘‘must 

take measures to ensure an equitable geographic distribution of 

funds in an appropriate balance in addressing the needs of urban 

and rural communities.’’ And I believe you referenced some 1,400 

applications in your opening testimony across the 50 States. 

Secretary LAHOOD. Yes. 

Mr. RAHALL. Some close to $60 billion applied for, which you 

have just $1.4 billion available for these grants, so I appreciate the 

situation in which you find yourself and your evaluation team. 

My question, I guess, is—and you are certainly keenly aware of 

the urban/rural split that creeps into any spending debates in the 

Congress, but can you please touch upon what your evaluation 

team and you have done or will do to ensure this equitable distribution of TIGER grants, in fact, to ensure they do get into rural 

communities? 

Secretary LAHOOD. Well, look, rural America is very important. 

We say that everywhere that we go; we believe that. I think if you 

look at the way that some of our other money has been spent out, 

it hasn’t been strictly in the urban areas. I have traveled to a lot 

of rural parts of America and I know the importance of rural America. There are people that have grown up in rural communities, 

want to stay there, want to retire there; they want to make sure 

there is affordable housing and good transportation for those rural 

areas so that people can get to a doctor’s appointment or a hospital 

or a grocery store. 

18 

I want you to know that, from my point of view, rural America 

is very important. We will look at the TIGER program and the 

kind of applications we have received and we will not overlook 

rural America. 

Mr. RAHALL. You said you are going to make those announcements, I believe, a month ahead of the statutory deadline? 

Secretary LAHOOD. We will make them later this year or possibly 

in January. 

Mr. RAHALL. So is the evaluation team, are they progressing on 

schedule? 

Secretary LAHOOD. They are. We have 10 teams. They have evaluation criteria and they review the applications and then the process continues from there. We think we have a very good evaluation 

process going on and we have a lot of people in the Department 

working on this. 

Mr. RAHALL. And if you might just comment a little further of 

how this process is going to be determined. 

Secretary LAHOOD. They are going to make recommendations to 

me, eventually. I mean, the first eyes that are on them now, the 

10 teams that are looking at these now are making sure that they 

meet the guidance that we put out and meet the criteria that we 

put out, and then they move to the next phase. If they meet that 

criteria, they move to the next phase. We are going to have to try 

and determine if the kind of requests that people have made, if 

they can come down from that a little bit or if there could be some 

adjustments in what they are trying to accomplish so that we can 

really do the best that we can for America with these TIGER 

grants. 

Mr. RAHALL. So out of these 1,400-some applications, would you 

anticipate that coming down to you would be a shortened list of 

how many? 

Secretary LAHOOD. Well, at this point I don’t know because there 

are 10 teams looking at those applications. But there won’t be 

1,400 recommendations. 

Mr. RAHALL. Sure. Those 10 teams, are they divided up geographically? Are they examining certain geographic regions? 

Secretary LAHOOD. No. They are 10 teams that have been 

trained all identically. They are all using the same evaluation so 

there can be real consistency in the evaluation of the applications. 

Mr. RAHALL. And each are? 

Secretary LAHOOD. They were just assigned—they were assigned 

a stack of applications and asked to review them based on the evaluation criteria. 

Mr. RAHALL. Okay. Thank you. 

Thank you, Mr. Chairman. 

Mr. OBERSTAR. Mr. Coble? 

Mr. COBLE. Thank you, Mr. Chairman. 

Mr. Secretary, good to have you back on the Hill. 

Secretary LAHOOD. Thank you. 

Mr. COBLE. Mr. Secretary, I would be remiss if I didn’t take the 

opportunity to make sure of the Interstate 85 Yadkin River Bridge, 

with which you are familiar, I am sure. As you probably know, the 

North Carolina Department of Transportation submitted a request 

to obtain funds to replace the bridge, rail infrastructure, and roads 

19 

associated with the project via the TIGER and discretionary grant 

program. 

The bridge itself, Mr. Secretary, is functionally obsolete and 

structurally deficient; negatively impacts commuters, commerce, 

and air quality because of the congestion. This is of vital interest 

to my district, to my State, and to all those who traverse the I-85 

corridor. It is the only project endorsed by the State of North Carolina for the TIGER and discretionary grant program, and has 

unanimous consent from the Members of our State’s congressional 

delegation. 

I understand that your Department has been the beneficiary of 

over 1300 applications and the timetable for funding announcements is January 2010. Can you provide any further insight to applicants regarding the status and what to expect from this process? 

Secretary LAHOOD. Well, you are the final Member of your delegation to talk to me about this, Mr. Coble. I appreciate it. 

[Laughter.] 

Secretary LAHOOD. I have heard from everyone else. I know this 

is a very important project; it will get very serious consideration. 

Mr. COBLE. And I thank you for that. I am glad we are on the 

ball; at least I hope you regard that as on the ball. 

Let me ask another question, Mr. Chairman, if I may. 

Mr. Secretary, I have heard from stakeholders in the transportation community regarding the EPA’s efforts to regulate coal combustion byproducts, such as fly ash, as a hazardous waste. I also 

understand that EPA may consider a hybrid approach to regulating 

the material so that the beneficial use of fly ash is deemed nonhazardous, but the material that remains would be classified hazardous. 

We have been advised that if the EPA decides to implement either of these approaches, concrete producers would have to use an 

average of more than 15 to 20 percent more cement per year of concrete to replace the fly ash. Do you have any cost estimates as to 

how much this might increase the cost stimulus related transportation projects, such as the Yadkin River Bridge, should the designation be finalized? Is this something that DOD is aware of and 

monitoring, and have you voiced any concerns to EPA? 

Secretary LAHOOD. You know, what, Mr. Coble? I will have to 

get back to you on that. I don’t have enough information to really 

talk intelligently about it. 

Mr. COBLE. All right. I thank you. 

Secretary LAHOOD. But I will do that. 

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21 

Mr. COBLE. I thank you for that. 

Mr. Chairman, I thank you and yield back. 

Mr. OBERSTAR. Thank you, Mr. Coble. 

Mr. DeFazio. 

Mr. DEFAZIO. Thank you, Mr. Chairman. 

Mr. Secretary, thanks for being with us today. With your indulgence, I would like to change the topic slightly. I would like to discuss where we are at in terms of a longer term authorization of 

surface transportation transit and highway projects. 

Yesterday, the Senate failed to get unanimous consent to do a 

90-day extension of the existing program, so we are operating now 

under a continuing resolution, which means roughly a 20 percent 

reduction in investment. We are going the wrong way here. As we 

all know, we need actually to increase our investment to not only 

build out a 21st century system, but to maintain the legacy that 

we have. The legacy system is in tough shape. 

I am wondering if the Department or the Administration, beyond 

the Department, has rethought its position regarding an 18-month 

delay, which, of course, would mean a two-to four-year delay, actually, which would mean status quo for probably the entire first 

term of the Obama Administration; and if not, why not? We feel 

a tremendous sense of urgency. The Chairman has been leading 

this Committee. We have stood down both the Administration and 

the Senate now on this issue because we feel so strongly that we 

have to go forward with new policies and more robust investment. 

Secretary LAHOOD. We talk every day about this, Mr. DeFazio, 

in the Department and with the White House, and particularly as 

the Administration evaluates the economy, evaluates the impact of 

our portion of economic recovery, which we believe is working and 

putting people to work and has really made a difference in rebuilding infrastructure in America. For the moment, I will tell you that 

we stand by our position of an 18-month extension and then to 

work with Congress to get to a comprehensive robust bill. I will tell 

you that the President is committed to a very comprehensive robust bill and trying to find the way to pay for it. 

And we have had many discussions with Mr. Oberstar’s staff on 

his ideas, on our ideas, and they are very compatible when it comes 

to the way forward and what we should be doing. So we continue 

to have many discussions about this, but for now we continue to 

believe that a longer term extension to get to a very good bill with 

all of you and also to find the money to pay for it is the best way 

forward. 

Mr. DEFAZIO. Well, we agree on the last point, a long-term; and 

I mean a six-year bill is what I would say is a long term, as opposed to an extension of the existing policies, because, again, your 

Department will be saddled with the policies of the past and there 

will be no increase in investment. 

Essentially when will all of the funds under the Recovery Act be 

obligated? 

Secretary LAHOOD. Probably about a year from now or a little 

longer. This was an 18-month bill. A lot of the money is obligated. 

But we know in certain parts of the country many of these projects 

will be suspended because of the weather and have to start up next 

year. But all of the airport money is out the door, so the runway 

22 

resurfacings that are going on, some of those will have to be suspended because of weather. You know, more than 70 percent of the 

highway money has been obligated, but a lot of those projects will 

either be suspended or get started next year during the construction season. 

But I would say, in direct answer, probably about a year from 

now is when all funds will be obligated, or a little bit later, but not 

much later. The transit money is pretty much out the door for new 

buses and facilities and things like that, but on the highway side 

of it, we know these things will have to be suspended because of 

the weather. 

Mr. DEFAZIO. Something weird is going on with the system; all 

the lights are blinking on and off. 

Very quickly, since you raised the issue of aviation,—Mr. Costello 

is here; I am certain he would like to know—I have heard some 

talk that the Administration is rethinking the strategy for funding 

the FAA reauthorization. Do you support us going forward at this 

point in time with the authorization? 

Secretary LAHOOD. Absolutely. We hope the Senate will pass a 

bill and then we will be very involved in the conference. 

Mr. DEFAZIO. Okay. All right, thank you. 

Thank you, Mr. Chairman. 

Mr. OBERSTAR. We look forward to that miracle happening. 

[Laughter.] 

Mr. OBERSTAR. Not of you being involved in the conference, but 

of the other body actually doing something other than Supreme 

Court justices, treaties, and ambassadors. 

Mr. Duncan. 

Mr. DUNCAN. Well, thank you very much, Mr. Chairman. 

Mr. Secretary, good to have you back. 

Secretary LAHOOD. Thank you. 

Mr. DUNCAN. You were a great Member here and I think you are 

doing a great job as Secretary. I appreciate your being here. 

Since Mr. DeFazio mentioned the highway bill or the surface 

transportation bill, I do wish that some people would think about 

the fact that since we are running into problems on some of the 

other big legislation, if we could get out a highway bill in this Congress, it could be the greatest accomplishment of this Congress, 

and certainly I think almost all of us on both sides would like to 

see that. 

I apologize that I had meetings and couldn’t get here before, so 

maybe you have covered this, so I will just ask one very brief question. There seems to be a pretty wide disparity between the States 

on the stimulus money, with the top five, let’s say, compared to the 

bottom five. What are the States doing that are getting more of the 

money? What are they doing right and what are the others doing 

wrong? Can you give us some hints? 

Secretary LAHOOD. Well, this is not that complicated. The States 

have to submit their proposals to our Departments—in the case of 

highways, to our Federal Highway people—and if we can check off 

the boxes, we will obligate the funds and they need to then get the 

contracts going. And, you know, some States are far and away 

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23 

ed, they sent us the proposals, we checked the boxes, we obligated 

the money. 

I mean, as I said in my testimony, I have been to 30 States. 

Every State I go to I try to meet with mayors and governors and 

legislators and people that are working on these projects, and I can 

tell you I have never met a worker that is complaining, because 

they were all on unemployment in January, February, and March, 

and now they are working in good paying jobs. Almost all the governors I have talked to have tried to do it the right way, by the 

book, so they can get this money going and get these roads built 

or bridges and get them resurfaced. The ones that have done the 

best job are the ones that have gotten the information to us, the 

paperwork; we check the boxes and—you know, I am simplifying 

a little bit, but if you talk to these State DOTs, that is the way 

it works. 

Mr. DUNCAN. I just was meeting in my office with the President 

of Norfolk Southern, and he said he was with you in Altoona just 

a few days ago. 

Secretary LAHOOD. Yes, sir. 

Mr. DUNCAN. So I do know you are getting around, and I think 

that is a great thing. I want you to come to Tennessee. 

Secretary LAHOOD. I will be there. 

Mr. DUNCAN. Thank you very much. 

Secretary LAHOOD. Thank you. 

Mr. OBERSTAR. I would just like to mention that we are likely to 

have a vote in the next 20 minutes or so and we have the Secretary 

until roughly 12:20. He has to leave for another, so I would like 

Members to be brief. 

Ms. Norton is next. 

Ms. NORTON. Thank you, Mr. Chairman, and thank you, Mr. Secretary, for all of your work, especially for what you have been doing 

with this summit. 

I have a question that comes from the precedent we have set 

with the stimulus and one that I think avoided both Civil Rights 

Act problems and, frankly, embarrassment considering where the 

greatest unemployment is. I congratulate you, Mr. Secretary, that 

you moved ahead on $20 million for an apprenticeship program so 

the minorities and women could get a foothold for the first time in 

the construction industry. This is a largely white male workforce 

because the Federal Government has not been in on the training, 

while, in fact, putting billions of dollars into roads and construction 

now for years. We are in some danger, but we have set a very important precedent. 

In the last bill, the Chairman and the Ranking Member saw that 

there was language that encouraged States to use some of these 

billions of dollars for training for a workforce of people of color and 

women. There is another reason to do this: the construction industry baby-boomer generation is aging out, so during the times before 

the collapse of the economy, there were actual shortages for journeymen in the skilled trades. So there is both an internal need and 

a need on the part of the Government. 

Seventeen States took this encouragement language in the most 

spotty fashion, little bit of it here and there. They preferred sometimes to spend all their money on roads with the same people who 

24 

have been doing it for decades, without any training for the new 

workforce that they are going to need. Only two States did anything that could be approached to be called a program because, 

why? It didn’t have to. 

So if the Federal Government is going to throw out billions of 

dollars and say, spend it the way you want to, it might be in violation of Title 7 and other parts of the Civil Rights Act. But if nobody 

says anything, then we are going to spend our money on roads. We 

are not talking about a lot of money, it was .51 percent or some 

such number; I don’t recall. 

This Congress said $20 million in the highway bill will go for 

such training. I am also, in the part I have jurisdiction over in construction, $3 million is going for it. Paltry amounts, but important 

precedent. I want to know whether you would support a requirement that some reasonable portion of the new bill, the new reauthorization bill, in fact be devoted to training to allow people to get 

a foothold in this industry who have never had an opportunity in 

this industry before because the Federal Government has given out 

money without requiring any training to be done. 

Secretary LAHOOD. Absolutely. I would be happy to work with 

you on it. We are very proud of our DBE program. I am very proud 

of Brandon Neal, who runs the program. He is doing a great job 

traveling the country and making sure that this money is getting 

out. I am also very proud that he allocated some of his money to 

Spellman College to allow for a program for 150 women from that 

school to become interns to get into transportation opportunities, 

whether it be engineering or whatever, so we can get those opportunities created at that level also. We just announced that program 

and it is the way for us to really encourage women and certainly 

women of color to get interested in transportation. But I will work 

with you on this. 

Ms. NORTON. Thank you, Mr. Chairman. We are talking about a 

requirement in the statute, not making it permissive, but a requirement in the statute that some portion of the money—we 

would have to decide how much—be spent on training, because we 

have seen, unless you require it, States will not do it; and I very 

much appreciate your answer, sir. 

Mr. OBERSTAR. The gentleman from Kansas, Mr. Moran. 

Mr. MORAN. Mr. Chairman, thank you. 

Mr. Secretary, thank you for the opportunity of having a dialogue 

with you this morning. I focus my questions in regard to TIGER 

grants. You indicated earlier about decisions made by the end of 

the year. Any ability to narrow that time frame? 

Secretary LAHOOD. Probably December. 

Mr. MORAN. Very good. TIGER has a wide array of options for 

those funds to be used. There are those who have expressed some 

concerns about freight and passenger rail being left out or receiving 

a lower priority. Any opportunity to reassure those interested in 

that aspect? 

Secretary LAHOOD. Well, I think if you look at the guidance on 

our Web site for the TIGER grants, what you will see is that we 

are looking for multi-modal opportunities, and certainly freight fits 

into that. And I think as we have talked to people around the 

Country, prior to receiving their applications, we know that there 

25 

were going to be port opportunities that would involve freight, that 

would involve taking trucks off the road, that would involve using 

the marine highway. I don’t think that freight will be disadvantaged if it is a part of a multi-modal kind of opportunity. 

Mr. MORAN. Okay. And in regard to a couple of other criteria, is 

there benefits to a local cost-share? Do they receive additional consideration if they put money into the project at a local or State 

level? 

Secretary LAHOOD. Of course. 

Mr. MORAN. Okay. And is that significant? 

Secretary LAHOOD. Well, now you are going to ask me to put a 

weight on it, and—look, any time that people are willing to put 

some of their own money in the game, that is a good thing. 

Mr. MORAN. I have never known you to answer a question you 

didn’t want to answer, Mr. LaHood, so I am not fearful of causing 

you to say something you don’t want to say. Finally, economically 

depressed areas, particular criteria or benefit for project being located in one of those areas? 

Secretary LAHOOD. Well, we all realize at DOT that this money 

is really to help communities recover from a lousy economy, so that 

is—the main criteria, though, is multi-modalism, really trying to 

create opportunities that didn’t really exist in other parts of the 

stimulus program, and economically disadvantaged communities 

have been a consistent part of what we have tried to do in all the 

different opportunities for economic recovery. 

Mr. MORAN. I thought I knew what you were going to say until 

you said it. Is that a positive or a negative, then, if you are an economically depressed area, when it comes to TIGER? And the reason I ask that question is you said that this was a niche you were 

trying to fill. Has that niche, in your opinion, already been filled? 

Secretary LAHOOD. Well, if you look at our economic recovery plan, which I know you have, $28 billion went to roads and highways, $8 billion went to transit, $1.5 is our TIGER opportunities, 

$8 billion for high speed rail, $1 billion for airports. So if you look 

at that and then you think about intermodalism, the one that really has not been addressed in that portion of any of those have been 

ports. Is that direct enough? 

Mr. MORAN. Always, Mr. LaHood. 

Secretary LAHOOD. Thank you. 

Mr. MORAN. Mr. Secretary, thank you very much. 

Mr. Chairman, thanks. 

Mr. OBERSTAR. I think the answer should be without prejudicing 

the Department’s decision-making process, or at least an instructive factor, is that we require in the law that priority be given to 

highway and transit projects and wastewater treatment projects, to 

areas of highest unemployment. That is in the law. It does not directly cover the discretionary grant program of DOT, but in the application of, and administering of the program, 63 percent of the 

funds have gone to areas of highest unemployment. So if the Department is following that logic, then they should also follow it 

through with the TIGER grants, I would think. 

Mr. MORAN. Thank you, sir. Even more direct than Mr. LaHood. 

Mr. OBERSTAR. Mr. Cummings. 

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

26 

Mr. Secretary, good to see you here. Thank you for doing an outstanding job. Mr. Secretary, I think you would agree that our 

Country is embarrassingly far behind in the development of a modern high speed rail system. Fortunately, the Recovery Act provides 

$8 billion for high speed rail grants. The applications, I understand, for projects were due on August 24th and applications for 

development programs are due tomorrow. Are we on track with regard to getting these high speed projects? And, if not, is there anything Congress can do to help? 

Secretary LAHOOD. We are on track. This is $8 billion more than 

the Department of Transportation has ever had in the history of 

the Department, and this is the vision of President Obama and 

Vice President Biden to get America into the high speed passenger 

rail business, and we will continue to work through the applications, evaluate them. But we are on track. 

Mr. CUMMINGS. On another issue, Chairman Oberstar and Chairman Obey worked very hard, along with Members of the Congressional Black Caucus, Donna Edwards and many others of us, to get 

$20 million in funding in the stimulus for bonding assistance for 

disadvantaged businesses. We had a lengthy hearing, thanks to the 

Chairman, in this Committee where people basically poured out 

their hearts, saying that they were looking into the window of opportunity, but begging to get in the door; and the bonding was the 

thing that was blocking them. And the $20 million is wonderful, 

and I understand that you have now taken that and then moved 

on to combine it with some other programs, but can you give us the 

status of that? 

Secretary LAHOOD. Well, the airports have used this bonding 

power very significantly. In my testimony, I pointed out some statistics where they have taken advantage of some provisions in the 

tax code to use this very well, but maybe what I should do is really 

get some very specific figures for you to address your question. 

Mr. CUMMINGS. I look forward to that. 

Secretary LAHOOD. Okay. 

[Information follows:] 

27 


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Mr. CUMMINGS. Because that is a very, very big issue, because 

we can have all the opportunity, but if people cannot get the bonding to do the programs, they might as well not have the opportunities, to be frank with you. 

Secretary LAHOOD. Right. Right. 

Mr. OBERSTAR. Would the gentleman yield? 

Mr. CUMMINGS. Yes. 

Mr. OBERSTAR. It was Mr. Cummings, Mr. Secretary, who was 

the inspiration for the bonding idea based on a prior experience 

with the State of Maryland. So we took Mr. Cummings’ suggestion 

and he spelled out in more detail the Maryland law, and we crafted 

it into the stimulus program providing that $20 million. 

Mr. CUMMINGS. That is right. 

Mr. OBERSTAR. We have also included and expanded it into our 

new authorization program for the surface transportation. So we 

will want, in our next recovery hearing, we will want to have a full 

accounting, but, meanwhile, I think it would be good for you to direct either RITA, the research information agency, to document the 

number of minority contractors who have received funds under the 

Recovery Act and the number of minority employees as well. 

Secretary LAHOOD. We will do it. 

[Information follows:] 

29 


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Mr. CUMMINGS. Just one last question, Mr. Chairman, and thank 

you. 

You were talking about Brandon Neal and the job he is doing 

over there in the agency, and I agree; he has done an outstanding 

job. This Spellman College initiative, do you plan to expand it beyond Spellman College? 

Secretary LAHOOD. Absolutely. 

Mr. CUMMINGS. Because, you know, there is a great effort to get 

more minorities into the pipeline. A lot of times these folks don’t 

even know about the opportunities and, as I have often said, it is 

hard to dream if you don’t see something and dream about it. So 

I just want to make sure that we go—Spellman, I think that is 

wonderful, but there are 100 or so plus other HBCUs that I think 

would benefit tremendously from the same program. I just wondered what your plans were with regard to that. 

Secretary LAHOOD. What I would suggest is that maybe Brandon 

meet with your staff and we can outline for you what the plans are. 

We wanted to get started at Spellman. 

Mr. CUMMINGS. Right. 

Secretary LAHOOD. I don’t want to say it is experimental, because it is already a good program and it will get particularly African-American women involved in transportation opportunities, 

which, as you said, they don’t know about. But we will have someone meet with your staff. We will have Brandon meet with your 

staff and sort of give you the outline of what our plans are. 

Mr. CUMMINGS. Thank you very much. 

Thank you, Mr. Chairman. 

Mr. OBERSTAR. And we would include Mrs. Napolitano in that 

meeting, whom I have designated to coordinate the work of minority business enterprises and minority workers. 

Secretary LAHOOD. Absolutely. 

Mr. OBERSTAR. Mr. Boozman. 

Mr. BOOZMAN. Thank you, Mr. Chairman. 

We really do appreciate your hard work, Mr. Secretary. One of 

the things, this Committee will have differences and things, but all 

of us agree that spending on the infrastructure is good spending for 

a variety of different reasons. The study that came out that we authorized in SAFETEA-LU or whatever, I think the average time 

that it took to build a road was like 13 years, and I would encourage anything you can do from an agency standpoint, even an Executive Order standpoint; and this is a great experiment that we are 

going through now in the sense of having all these things out. 

If we really could, we have studied this thing to death, but 

through the experience that the agency is going through now, anything that we can do to reduce that time from 13 years, or whatever it is, down to a reasonable amount of time truly would give 

us so much more bang for the buck. Like I say, we have studied 

it to death, this and that, but I really would appreciate, and certainly myself, I think the Committee, I think I can speak for all 

of us, that is something that would be so beneficial. And I think 

we really have a window of opportunity that we could actually get 

something done in that regard. 

Secretary LAHOOD. Well, we put together a team of people, called 

our TIGER team, to get this economic recovery money out the door 

31 

and met or beat all the deadlines set by Congress, and we should 

be able to do that with our other programs, I agree. The most common complaint I have heard is it takes too long to get these 

projects funded, and we have proven, with the economic recovery, 

it can be done, and it is done right and the money is spent correctly. I take your point on that. 

Mr. OBERSTAR. I would point out, and I appreciate the gentleman 

raising that, in our surface transportation authorization bill we restructure the Federal Highway Administration and the Federal 

Transit Administration to include within them an Office of Project 

Expediting to designate one person or staff that will ride herd on 

projects of a certain size to ensure that they go through the permitting process and there are permits of a whole range of issues and 

entities at the Federal, State, county, township level, to get those 

all coordinated. 

We attempted to do this in the SAFETEA bill with section 6001 

of Title 23, U.S. Code, but States have not implemented that language, so we have taken their experiences, why these projects have 

delayed. For a mill and overlay, on average, it takes three years; 

for a transit project, 14 years from idea to ridership. Meanwhile, 

the cost doubles and people lose hope, and the ridership on opening 

day falls off from the original expectations. 

But we are going to fix that in this next legislation, and that is 

why we need to get it done in the next three months, and not 18 

months. 

You stopped nodding, Mr. Secretary. 

[Laughter.] 

Mr. OBERSTAR. You were doing well until that point. 

The Committee will stand in recess for these votes and come 

back. I think it is only one vote. We will come back immediately. 

[Recess.] 

Mr. OBERSTAR. The Committee on Transportation and Infrastructure will resume its sitting, with apologies to witnesses, although 

the Secretary understands very well; he had to go through that 

himself as a Member. 

Mrs. Napolitano is next on our list. 

Mrs. NAPOLITANO. Thank you, Mr. Chairman. 

Secretary LaHood, it is great to see you, sir. 

Secretary LAHOOD. Thank you. 

Mrs. NAPOLITANO. I was commenting to the Chairman that while 

there are figures that may not show the correct employment data, 

I think a lot of that data is usually so far behind in reporting the 

unemployment and the current employment, so that I don’t think 

it is a true picture, at least not from where I come from. 

Secretary LAHOOD. I agree with that. I don’t want to use unemployment, the fact that it is the lagging indicator, as an excuse, but 

I agree with you, the picture is better than has been portrayed. 

Mrs. NAPOLITANO. Thank you, sir. I just want to make that clear 

because I think that we do ourselves and the Country a disservice 

when we use figures that are not current or updated, or true figures, for that matter. 

You have been in my area, you know the circumstances of the 

Alameda Corridor. I was also just dialoguing with some of my colleagues in regard to the need for California’s mass transit, SouthVerDate Aug 31 2005 10:49 Dec 23, 2009 Jkt 000000 PO 00000 Frm 00101 Fmt 6602 Sfmt 6602 P:\DOCS\52650 JASON
32 

ern California specifically. The fact that they are wanting to put in 

the high speed rail, which will impact some of my minority communities, yet, I still need mass transit. We only have buses and they 

clogged up in the arteries of the freeways and that ever-loving 

parking lot of the sky that we call it. 

How do we mitigate the noise, the congestion, the safety impacts 

that the high speed rail will bring? As I was mentioning before, it 

was brought to my attention by one of the mayors of my bordering 

city council that some of the other countries are beginning to do 

away with the normal high speed rail and going to mag-lev type 

because of the noise because of the use of electricity instead of energy that is now being used in trains and some of the other locomotives. 

And then the other question would be the railroad companies are 

opposed to utilizing their right-of-way to allow any high speed rail 

or any other mass transit when they have ownership of those 

areas. So that kind of ties in because they feel it hinders their 

goods movement, which, to a certain degree, I am in agreement 

with. But how do we address those things? 

And the third question would be since many of the California 

groups were not able to access the funds, the stimulus funding because they didn’t have NEPA clearance. However, CEQA is more 

stringent than the California NEPA. How do we streamline that 

process? 

Secretary LAHOOD. Well, first of all, Mag-Lev is very, very expensive. 

Mrs. NAPOLITANO. Correct. 

Secretary LAHOOD. And the $8 billion that was in the economic 

recovery plan for high speed rail, we have received some proposals; 

we will receive additional proposals. California, as you know, has 

been working on high speed rail for a decade or more. They were 

even—some folks were even able to convince the people to pass a 

$10 billion referendum, so there is money set aside to match with 

whatever Federal dollars are allocated. 

But that doesn’t interfere with other opportunities for transit. I 

haven’t really looked at the high speed rail proposal from California carefully enough to know, but I will say this, high speed rail 

in other countries is very quiet, it is not noisy, and it is very clean 

burning, and in some instances can get up to pretty good speeds, 

also. And that is not going to disadvantage a State or a community 

from getting transit money; the two are really separate and they 

are disconnected. 

So I would encourage you to continue to work on those transit 

needs with our Department, but knowing full well that California 

is in the mix when it comes to high speed rail, and wants to be, 

and has been working on it for a long period of time. 

Mrs. NAPOLITANO. How do we get mass transit to be able to be 

co-joined with high speed? 

Secretary LAHOOD. Having the State get their act together so 

that their proposal is multi-modal, and that is what some States 

have done. I was just in Denver. They have taken Union Station 

in Denver, Colorado, transformed the facility. There will be six 

light rail lines running in there with an Amtrak connection. So you 

get these intermodal facilities that have buses coming in, light rail 

33 

with a connection to passenger rail that goes at higher speeds. The 

way to do it is really to develop proposals that include multi-modal 

opportunities. 

With respect to NEPA, those are laws that were passed by Congress. I am sure your laws are much tougher in California because 

you folks are always well ahead of the curve on these things. But 

we follow the law and Congress has passed laws having to do with 

environmental impact statements and studies that have to be done 

before projects can be awarded. So I leave it up to all of you to decide. We go along with what the laws are that we have to follow 

that are passed by Congress. 

Mrs. NAPOLITANO. May we work with you, then, to be able to 

bring those together so that we may be able to pass some amendment to the highway act? 

Secretary LAHOOD. Absolutely. 

Mrs. NAPOLITANO. Okay. 

Secretary LAHOOD. Absolutely. 

Mrs. NAPOLITANO. Thank you, Mr. Speaker. 

Mr. OBERSTAR. The gentlewoman’s time has expired, but in our 

surface transportation authorization bill we do exactly that, we 

provide the means, the structural means by which we can be intermodal, starting with reorganizing the Department of Transportation, creating a council on intermodalism, establishing an under 

secretary for intermodalism, requiring the modes to meet at least 

once a month to establish six-year strategic investment plan; and 

within the Federal Highway and Federal Transit Administration, 

establish an Office of Project Expediting. 

And to carry further, to build on the provision I included in the 

current SAFETEA, where, instead of the sequential process for permitting, where every agency has a crack sequentially and they 

wait, no one does anything until the first one has acted, we turn 

it on its side and have them all provide authority for all of the permitting entities to act concurrently, rather than consecutively. And 

it hasn’t been well carried out by State DOTs, so we are going to 

advance this process and cut from 14 years to 3 years the time it 

takes to do a transit project and get it underway. And with Secretary LaHood there at the helm, we will do that. We just have to 

get the six-year bill passed. 

Ms. Richardson. 

Ms. RICHARDSON. Thank you, Mr. Chairman. 

Thank you, Mr. Secretary, for coming to testify today. I also want 

to say for the record that you have been in California. You are out 

and about. Everything that you said, you are out there. I want to 

say for the record I have found that to be actually very true. 

Secretary LAHOOD. Thank you. 

Ms. RICHARDSON. So we appreciate your involvement. 

A couple questions that I had for you. The overall objective of the 

Recovery Act, the stimulus, was to sustain and create jobs, and 

probably each member has their own experience. But what I would 

say is, in my particular areas, I don’t see new people getting hired. 

So what statistics are you keeping that is actually keeping track 

of folks who are getting hired and new people who are getting 

hired? 

34 

Secretary LAHOOD. Well, I will be happy to provide to you the 

statistics for your district in terms of projects that have been funded, whether they be road, transit, airports, and the number of people—I mean, we are keeping track of the number of people and we 

have that documented according to congressional district and by 

State, and I will be happy to provide it to you by State or by congressional district. 

But what we have found is that certainly in the highway and bridge aspect of it, the $28 billion, thousands of people have been 

hired all over the country to do these jobs, and in some instances 

they are people that have worked for—these jobs are provided by 

contractors who do road work, and whether they are hiring new 

people or not, that is something that we can work with you on to 

really try and determine that. 

Ms. RICHARDSON. I did pull up the list that you have on the Web 

site that has, by my district, the various projects that are being 

done, but I would like to see the statistical information of who is 

actually being hired. And even if it is not impacted for this particular program as we spend the money, it is lessons learned of 

what we need to do to write the legislation better in the future. 

Secretary LAHOOD. We will work with you on that. 

[Information follows:] 

35 


Insert offset folio 69 here 52650.069
36 

Ms. RICHARDSON. The other question that I had, I cannot have 

this conversation with you as the Secretary without joining with 

some of my colleagues in stressing our desire to have an authorization much sooner than 18 months. And I realize that you work with 

the Administration and you all have to sing from the same song 

book, but it should be no confusion that this Committee, we are 

very concerned. 

We are not in agreement with an 18-month extension and we 

would like to move forward, and I would like that message to be 

delivered to the President and to the Administration. I think it is 

a mistake, I think it is going to come back to bite us, and I just 

think that it needs to be dealt with. So, for the record, I wanted 

to join with the Chairman and others who have spoken that that 

is not the will of this Committee and we are quite concerned. 

Secretary LAHOOD. I will deliver the message. 

Ms. RICHARDSON. Thank you. 

Lastly, I want to talk about on the back of your testimony you 

reference the Attachment No. 1, which talked about economically 

distressed areas in California. Do you also have a list of where 

those areas are? 

Secretary LAHOOD. Sure, we can get that for you. 

[Information follows:] 

37 


Insert offset folio 70 here 52650.070
38 

Ms. RICHARDSON. Okay. Then, finally, does Victor Mendez handle 

your overall recovery stuff and Brandon Neal handles the diversity 

training and contracts? 

Secretary LAHOOD. That is correct. 

Ms. RICHARDSON. Okay. Thank you, sir, it is a pleasure to see 

you, as always. 

Secretary LAHOOD. Thank you. Thank you. 

Mr. OBERSTAR. I thank the gentlewoman for that message and 

for all the Members who have delivered that message. We have a 

good messenger to bring that to the White House. 

On the unemployment in the construction trades, I just want to 

interject at this point. In December of 2007, when I first proposed, 

and Democrats on the Committee first proposed the stimulus, unemployment in the building trades was 968,000. A year later it was 

1,438,000. We had shaped our bill and had actually moved a bill 

through the House for a stimulus program. In August—well, actually, in early 2009, that number went up to 2,045,000, but in August it had gone from 2,045,000 to 1,542,000. It is down another 

30,000 jobs for construction workers since then, since August. So 

we have made about an 8 or 9 percent reduction effect in the unemployment figures for the construction trades. 

Mr. Hare. 

Mr. HARE. Thank you, Mr. Chairman. 

Welcome, Mr. Secretary. It is good to see you. I just wanted to 

say, also for the record, how incredibly open you are to meet with 

Members. When I called you to sit down, I thought, well, maybe 

in about a month, and you were there in about three days. I appreciate your openness and your willingness to work with us. 

I just have one question for you. With the high speed rail 

projects that are going on around the Country, the proposals, when 

you have States that don’t like the route or there is some litigation 

pending or whatever, is there something that we can do from our 

end to make sure? Because I think high speed rail is a top priority 

for this Country. We absolutely have to have it—and, obviously, I 

am very selfish—coming from my own State of Illinois, but around 

this Nation. And I am just wondering, from your perspective, is 

there anything that we can do or that your agency could do to sort 

of kind of clear up, if there is a problem or two that we can work 

on to get these things moving and not have a delay. 

Secretary LAHOOD. Well, we have received a number of proposals 

for high speed rail and we will continue to receive proposals, as of 

tomorrow, for the second phase of that. Illinois is a part of a regional program and the governor of Illinois has played a very key 

leadership role in calling a meeting of a number of the governors 

from around the Midwest region, and they have put together a very 

good proposal. And we are looking at all of those and if there are 

specifics that we think one region or another needs to look at, we 

have gotten back to those regions and talked to them about that 

for the next opportunity that will present itself. 

Our people have worked very closely with these regions around 

the country to make sure they know what were some of the key 

things that we are looking for as they present their next proposals, 

so this has been very collaborative and I think the regions will be 

39 

submitting some very strong proposals for our high speed rail opportunities. 

Mr. HARE. Mr. Secretary, just so that I am clear, when does the 

money from the Department go to the States so that they can start 

the projects? 

Secretary LAHOOD. Probably later this year. We are still evaluating and working on that, but we hope later this year. 

Mr. HARE. Okay. Well, I just appreciate your coming here, and 

let me just echo what everybody here today has said in regard to 

the 18 months. I hate to sound repetitive, but we really need to 

move that up. Every dollar we invest in infrastructure we get $5 

back, and if we are really going to get this Country moving, from 

my perspective, we have to get people working again. I think the 

Chairman said 140,000 people are working since we have done 

this. Just whatever we can do to get that done so that we can get 

these projects rolling and get people back to work. Also, just from 

a matter of public safety, I think it is incredibly important. But 

thank you for everything you have done and thanks for taking the 

time to come today. 

Secretary LAHOOD. Thank you. Appreciate it. 

Mr. OBERSTAR. That number is 123,000 in direct jobs as the end 

of September created on highway and bridge and transit projects, 

and another 80,000 in the supply chain for 200,000. That, plus the 

additional jobs that have been stimulated, means we have had a 

reduction of 500,000 of the unemployed in the construction trades, 

meaning $2.5 billion in payroll has been pumped into the national 

economy. 

Ms. Titus. 

Ms. TITUS. Thank you, Mr. Chairman, and thank you for continuing this important work of examining the progress of the Recovery Act. I was pleased to vote in favor of it because Nevada has 

been hit very hard. We have the highest foreclosure rate; we have 

had the highest unemployment since we started keeping records. 

So the money that we get through this Act will go a long way to 

creating jobs. 

One of the things that worries me, though, is how well we are 

doing at the State level. In the last report that this Committee put 

out, Nevada ranked 46th of 50 States and Washington, D.C. I was 

hopeful that in the most recent report we would have moved up; 

instead, we have moved down to 47th. Now, when this happened, 

I sent a letter to the governor, asking what is happening in Nevada, why are we doing so poorly, and the response that I got from 

him through the secretary of NDOT or the director of NDOT was 

that Nevada had chosen to use the money on a lot of small projects, 

rather than one big project, so it took longer for the money to get 

out. 

Well, I reviewed some of the other States and have found that 

those that are far ahead of us on the list have also spent it on 

small projects, so I wonder, Mr. Secretary, if you can clear this up 

for me. Does that really make a difference or is something happening in Nevada that we need to improve? 

Secretary LAHOOD. Well, as you know, we have worked with governors in every State and the Department of Transportation in 

every State on the kind of priorities and projects that they felt they 

40 

could fund, and I don’t know enough about Nevada, but why don’t 

I do this. Why don’t I look at Nevada, do an analysis, and come 

up and see you and we can talk about that. 

Ms. TITUS. Well, I would certainly appreciate it, because we need 

that money to be moving out, and I am afraid it is at that end, not 

at your end. But I appreciate that. 

Secretary LAHOOD. No, before we lay blame at anybody’s feet, let 

us really do a good analysis so we get it right. 

Ms. TITUS. Well, I appreciate that. Thank you very much. I look 

forward to it. 

Thank you, Mr. Chairman. 

Secretary LAHOOD. Thank you. 

Mr. OBERSTAR. Thank you, Mr. Secretary. I know you have a 

commitment and have to leave, but I do want to raise the issue 

that was highlighted in a USA Today news story that I already 

commented on and that I responded to various reporters saying 

they didn’t get the best projects out in the Recovery Act, they are 

doing state of good repair, but they are not doing the best projects. 

Some people just can’t be happy with success. It just drives me 

crazy. I just want to make it clear and I want to get your response. 

The USDOT does not make those decisions of which projects. 

Secretary LAHOOD. Correct. 

Mr. OBERSTAR. The Federal Highway Administration does not select projects. 

Secretary LAHOOD. That is correct. 

Mr. OBERSTAR. The State DOTs select the projects. 

Secretary LAHOOD. That is correct. 

Mr. OBERSTAR. They use the criteria we set forth in the stimulus 

act. 

Secretary LAHOOD. Right. 

Mr. OBERSTAR. And the stimulus act required States to select 

projects that could be under contract or obligated within 120 days. 

Secretary LAHOOD. Right. 

Mr. OBERSTAR. Did not make a distinction of what type of 

project, is this going to be a highway that will last 150 years, is 

it one that is going to be the best. It is going to be the one that 

puts people to work, correct? 

Secretary LAHOOD. Correct. 

Mr. OBERSTAR. And it had to meet the other criteria that the 

projects had to be located, preferentially, in areas of highest unemployment according to the EDA designation. 

Secretary LAHOOD. That is correct. 

Mr. OBERSTAR. All right. So all this stuff that we are reading 

about is either misrepresentation, deliberately or through lack of 

knowledge—there is another word for that we need not use—and/ 

or deliberate attempt to discredit the recovery program. 

Now, I cited earlier DOT and U.S. Federal Highway Administration work with the States. You gave them guidance, you helped 

them through. What paperwork issue could there be? 

Secretary LAHOOD. Mr. Chairman, I responded to that article 

with a letter to the editor of the USA Today, which I think might 

have appeared yesterday. I agree with you, that story had so much 

misinformation about it. 

Mr. OBERSTAR. Like putting out a grass fire. 

41 

Secretary LAHOOD. You can call any governor or State DOT— 

and I would encourage any Member to do this—and ask them has 

there been good communication, have we been helpful, has the 

money been spent correctly; and the answer up and down the line 

is yes. I have been to 30 States; I have talked to a lot of these governors and DOT folks. We are doing it the way you asked us to do 

it, the way you required us to do it, by the book; and I haven’t seen 

one story written about an earmark, boondoggle, or sweetheart 

deal, I can tell you that, because we have done it by the book. 

Mr. OBERSTAR. And there hasn’t been a single earmark either 

from the House or the Senate. 

Secretary LAHOOD. That is right. 

Mr. OBERSTAR. Not a single Member of the Appropriations Committee of either body has designated an individual project, they 

have all gone out by the book. 

Secretary LAHOOD. That is right. 

Mr. OBERSTAR. By the States; their choice, their decision. Just 

get them out fast, put people to work. 

Secretary LAHOOD. Right. 

Mr. OBERSTAR. I would like you to, as we continue this process, 

though, to do one additional thing, to direct Federal Highways to 

survey the States on the proportion of their portfolio of projects 

that need to be upgraded to state of good repair and to make a projection by the end of their expenditure of Recovery Act funds how 

much of that portfolio of state of good repair projects they will have 

diminished. 

Secretary LAHOOD. We will do it. I will have Victor work on that. 

Mr. OBERSTAR. This information will set the stage for the authorization. 

Secretary LAHOOD. Yes. 

Mr. OBERSTAR. The six-year authorization. You know we compressed the 108 categories into four formula programs, the first of 

which is critical asset improvement, and that category is to respond 

to the States’ need and the two national commissions’ recommendations and AASHTO’s own recommendation that we attack and put 

funding in the backlog of projects that need to be brought up to engineering standards of good repair. 

Secretary LAHOOD. Yes. 

Mr. OBERSTAR. So we want to help them do that. 

Secretary LAHOOD. Good. 

Mr. OBERSTAR. But I want them to lay out a six-year strategic 

investment plan and annual benchmarks of achievement and reporting. Now they are accustomed to reporting. 

Secretary LAHOOD. Right. 

Mr. OBERSTAR. So we will have transparency, accountability, and 

action on the greatest need in our Federal Highway program is to 

get roadways up to state of good repair. 

Secretary LAHOOD. Good. We will do it. 

Mr. OBERSTAR. And we found that given the funding they can do 

that. 

Do other Members have any other questions? 

[No response.] 

Mr. OBERSTAR. Mr. Secretary, thank you. 

42 

Secretary LAHOOD. Mr. Chairman, thank you for your leadership 

in so many ways, it has been a real treat to work with you and 

the Committee, because we have the same goals in mind, we really 

do, and we will get there. 

Mr. OBERSTAR. We are. We are getting there day by day. Things 

are better. Just keep Joyce Fisk in mind, that truck driver from 

Knife River Construction, whose kids have gone to summer camp, 

is getting her health insurance back. When she puts in her 1,200 

hours, she will have her health insurance back, her husband will 

have; they are paying their mortgage; and they are putting food on 

the table; and they are paying taxes; and they are happy about it. 

Secretary LAHOOD. Thanks to your leadership. 

Mr. OBERSTAR. Thank you. 

We will call our next panel, which includes the Honorable John 

Cox of the Wyoming Transportation Department; Charles Gallagher, President of Gallagher Asphalt Corporation for American 

Road and Transportation Builders Association; Mr. Ward Nye, 

President of Martin Marietta Materials, representing the National 

Stone, Sand & Gravel Association; Mr. Paul Soubry, President and 

CEO of New Flyer; and Mr. T. Jefferey Taylor, Manager of Transportation for Elkhart County, Indiana. 

While the bells have rung for votes on the House Floor, we will 

begin with Director Cox, take your statement. Let’s see where we 

are going. We are going from right to left here, all right. Very good. 

Welcome and congratulations on being number one. 

TESTIMONY OF THE HONORABLE JOHN COX, DIRECTOR, WYOMING TRANSPORTATION DEPARTMENT; CHARLES GALLAGHER, PRESIDENT, GALLAGHER ASPHALT CORPORATION, 

REPRESENTING THE AMERICAN ROAD & TRANSPORTATION 

BUILDERS ASSOCIATION; WARD NYE, PRESIDENT, MARTIN 

MARIETTA MATERIALS, REPRESENTING THE NATIONAL 

STONE, SAND & GRAVEL ASSOCIATION; PAUL SOUBRY, 

PRESIDENT AND CEO, NEW FLYER; AND T. JEFFERY TAYLOR, 

MANAGER OF TRANSPORTATION, ELKHART COUNTY, INDIANA 

Mr. COX. Good day, Mr. Chairman, and thank you. As was stated, I am John Cox, Director of the Wyoming Department of Transportation. By the way, Governor Freudenthal sends his greetings 

to the Committee. 

Mr. Chairman, thank you for this opportunity to quickly discuss 

Wyoming’s success in implementing the highway provisions of the 

economic recovery legislation. 

First, Mr. Chairman, let me thank you for your leadership and 

this Committee for its efforts to secure Recovery Act funds for 

transportation. We were thrilled, frankly, when a recent report by 

this Committee ranked Wyoming first among the States for 

promptly investing Recovery Act highway funds. I want to quickly 

discuss that today. 

Today, 100 percent of Wyoming’s Recovery Act highway funds 

have been obligated, and over 99 percent of those are awarded to 

contract. Projects involving more than 95 percent of these funds are 

underway and nearly a third of the funds have already been expended. By latest count, in August, 1,739 jobs have been created 

43 

or sustained in Wyoming because of these funds and their disbursement, and that is nearly one half percent of the State’s working age 

population. These jobs are in addition to contractors’ full-time 

workforces. Wyoming has also completely obligated the funds from 

our regular 2009 Federal Aid Highway Program. 

The projects that we have supported with Recovery Act highway 

funds have advanced the national interest in a connected transportation serving people and business from all over the Country. As 

one example, we have invested over $40 million of our funds to improve Interstate 80, which is a critical route for both freight, commerce, and tourism. We are pleased that we have furthered both 

national and home State interest in promptly deploying our share 

of these funds. 

Let me quickly describe how we were able to produce so quickly. 

First, Wyoming began planning for the Recovery Act before it 

was passed, with great leadership from Governor Freudenthal, who 

was, frankly, determined to move promptly and efficiently to invest 

all Recovery Act funds made available to the State. He consulted 

early on with our legislators and, as a result, both the legislature 

and the governor supported our implementation efforts, the bottom 

line being that we were able to use our existing process to approve 

projects and award contracts in short order. 

During the same time frame, we worked closely with our Federal 

Highways Division office and identified the equivalent of nearly 

three years worth of projects that would proceed to contract quickly. We also confirmed that the contractor community was ready 

and had the capacity to deliver what we said we had ready. Both 

Federal Highways and the Wyoming Contractors Association are 

tremendous partners with whom we have a daily relationship. 

There were several other factors that kept us pushing hard to 

implement the law as quickly as we could. We thought that bid 

prices would be the most competitive in the early months following 

the passage of the stimulus. That was accurate, but they have also 

held strong throughout. We also considered our construction season. Because of our climate and elevation, we are very fortunate if 

we have six to seven months to work with in a given year. It also 

helped that the money was subject to current law, with only a few 

changes. Significant process or program changes may well have 

slowed our pace. Working from our list of ready to go projects, we 

considered the priorities and requirements of the law. We assembled a project list and then we aggressively scheduled extra lettings 

to award contracts. 

So, Mr. Chairman, basically what we did was we planned early 

and we pushed hard at all stages of the implementation, and we 

had the advantage of support from the governor and the legislature, both. 

Mr. Chairman, before concluding, I would like to emphasize that 

we are eager for the opportunity to make additional transportation 

investments. In case some may not be familiar with our part of the 

Country, let me suggest just a few reasons why Federal transportation investment in a rural State like Wyoming is in the Nation’s 

interest. 

Investment benefits a much larger population than lives in Wyoming or even our region, with several nearby metropolitan areas. 

44 

Other rural States are very similarly situated. Our highways are 

a bridge for through traffic. Trucks moving between the West Coast 

ports and Chicago, for example, cross our State, so the highway 

benefits citizens at both ends of the movement. Interstate 80 traffic, in particular, consists largely of through truck traffic neither 

originating nor terminating in our State. 

Our Federal highways also benefit tourism, providing visitors 

from all over the world access to scenic wonders like Yellowstone 

and Grand Teton Parks in Wyoming, Rocky Mountain National 

Park in Colorado, Glacier in Montana, Black Hills in South Dakota, 

and may other regional destinations. Our roads help crops and forest products move to market; they serve the energy industries, including wind energy, which is a big thing in Wyoming right now, 

with their many work and production sites in rural areas. 

We know that many needs exist throughout the Country, but I 

wanted to note for the Committee the strong transportation funding for rural States like Wyoming is decidedly in the national interest and it will help connect the metropolitan areas and populations. 

We look forward to continuing to work with Congress in making 

further progress in transportation investments in Wyoming and in 

the Nation, and we will keep putting funds to work promptly and 

effectively. 

Mr. Chairman, that concludes my statement. I would be happy 

to field any questions you might have. 

Mr. OBERSTAR. Thank you very much. You answered a number 

of questions that I already had intended to ask, but I will pursue 

some of those further. We would like to build on Wyoming’s experience moving projects further, and I will have some questions for 

you about the rural transportation provisions in our surface transportation authorization bill. I would like you to just sort of think 

about that. 

We will recess at this point for the roughly 25 minutes it will 

take to complete these votes. 

[Recess.] 

Mr. OBERSTAR. The Committee will resume its sitting. We are 

safe for about an hour or so before the next votes and we will now 

continue with Mr. Gallagher for ARTBA. 

Mr. GALLAGHER. Thank you. Chairman Oberstar and Members of 

the Committee, I am Charles Gallagher of Gallagher Asphalt, 

President and owner of that company. I am also a past president 

of the Illinois Road and Transportation Builders Association and 

here on behalf of the American Road and Transportation Builders 

Association. 

Gallagher Asphalt was founded by my grandfather, James F. 

Gallagher, in June of 1928, just 17 months before the Great Depression. Gallagher is now owned by a third generation of Gallaghers, including myself. 

From the perspective of our company, the Recovery Act has been 

a real shot in the arm during one of the most difficult periods in 

our industry’s history, and for that we thank the Members of this 

Committee for their efforts and your efforts to secure as much 

transportation funding as possible with the stimulus bill. 

The economic downturn has taken a severe toll throughout the 

Nation, including revenues on all levels of governor for highway 

45 

construction, as well as our private sector construction. As evidence 

of this reality, I would like to share with you that our asphalt production at our Joliet facility is down 65 percent from the 2008 levels. Fortunately, Gallagher was low bidder on eight ARRA projects, 

totaling just over $15 million between April and June of this year. 

These projects directly employ 259 men and women, of whom 30 

percent are minority and 7 percent are women. Twenty-nine new 

jobs were also filled for these projects. 

My company is proof that the Recovery Act is achieving its goal 

of sustaining and sometimes creating jobs. According to the Federal 

Highway Administration data provided to ARTBA, every State met 

the requirement that 50 percent of their formula funds be obligated 

within 120 days. State and local transportation agencies have obligated $18.4 billion, or 68.9 percent, of the highway stimulus funds 

in six months. This is a much faster pace than under the core Federal Highway program. There are now 3,966 Recovery Act projects 

under construction in all States, including more than 600 that got 

underway in September. These projects are valued at $11 billion. 

The impact of the ARRA is even more evident when looking at 

new highway contract awards, which is the best indicator of future 

construction activity. State and local DOTs awarded $2.1 billion 

fewer contracts for highway and bridge construction in the first 

four months of this year than in the same period in 2008, reflecting 

recession-driven cuts to State and local highway funding. In the 

second four months of 2009, however, the value of new highway 

and bridge contracts exceeded the 2008 levels by almost $4 billion. 

As such, the ARRA has more than offset State and local budgetary 

difficulties, and we are trending towards an increase in 2009. With $7.6 billion in highway recovery funds obligated for projects not yet underway and the remaining $8 billion still to be obligated, 

the ARRA will continue to boost the U.S. highway construction activity well into 2010. Furthermore, recent easing in material prices 

has increased the purchasing power of Recovery Act funds to support more projects and deliver more economic benefits. What that 

really means is that the contractors are really bidding low on 

projects, so your dollar is going a lot further. 

Mr. Chairman, the ARRA is doing what Congress intended: Federal funds are being obligated at a rapid pace; projects are being 

started; construction work is being performed; and firms across the 

Nation, like mine, are sustaining, and sometimes adding to their 

workforce. This year, the value of construction work performed on 

transportation projects will be above the 2008 levels largely because of ARRA. Without the recovery funds, transportation construction would be down, way down, with no recovery in sight. 

That is the real story. 

The American public and our elected leaders need to understand, 

however, that ARRA is only a temporary solution. The Act’s benefits will disappear quickly after 2010, and the jobs it is supporting 

will disappear. To sustain and build on the Recovery Act and reenergize the long-term growth potential of the United States, we 

need Congress to take on the six-year surface transportation authorization bill at the $500 billion level, and we thank the Committee for their activity in this regard. 

Thank you. 

46 

Mr. OBERSTAR. Thank you very much, Mr. Gallagher. I especially 

support that support for the six-year authorization. I will take that 

part of your testimony and send it over to the Secretary and over 

to the White House so they see that as well. 

Mr. GALLAGHER. Very good. 

Mr. OBERSTAR. Mr. Nye, on behalf of the Sand and Gravel Association. 

Mr. NYE. Indeed. Good afternoon, Chairman Oberstar. It is good 

to see you again. It is a pleasure to be here today. My name is 

Ward Nye. I am the President of Raleigh, North Carolina-based 

Martin Marietta Materials, one of the Nation’s leading producers 

of construction aggregates. I thank you for the opportunity to appear before the Committee today and to present the industry’s perspective on the Recovery Act, which I may refer to interchangeably 

today as stimulus, and to discuss its impact on our industry. 

As background, Martin Marietta is a New York Stock Exchange 

company with 2008 sales revenue in excess of $2 billion. We’re engaged principally in construction aggregates, meaning mining, 

processing, and selling crushed stone and sand and gravel for use 

in the construction of highways and other infrastructure projects, 

as well as in the commercial and residential construction industries. 

Aggregates, along with hot mixed asphalt and ready mixed concrete, are sold and shipped from Martin Marietta’s distribution network to customers large and small in 29 States. We have been in 

this business, through our predecessors, since 1939. 

That said, I am testifying today on behalf of the National Stone, 

Sand & Gravel Association, which you know as NSSGA, which represents the aggregates industry. According to the U.S. Geological 

Survey, NSSGA is the largest mining association by product volume in the world. There are more than 10,000 construction aggregate operations nationwide, and 70 percent of our Nation’s counties 

have at least one aggregate facility. 

Aggregates are used in critical forms in most forms of heavy construction. For example, 38,000 tons are used to construct one mile 

of highway; 15,000 tons are used in an average school; 400 tons are 

used in an average home, and that is not counting what is going 

on in the subdivision all by itself. 

Yet, due to the degree and severity of the current economic and 

protracted turndown, the industry is facing another year of economic turmoil and difficulty. For example, on June 30th, 2009, at 

the half year, Martin Marietta reported its 13th straight—13th 

straight—quarter on quarter decline in aggregate shipment volume. Similarly, according to the USGS, aggregate production in the 

U.S. decreased 27 percent in the first six months of 2009 over the 

same period in 2008. This decreased usage in 2009 was on top of 

previous aggregate declines in both 2007 and 2008. 

In preparation for this hearing, NSSGA disseminated a producer 

member survey specifically geared toward measuring stimulus and 

its related activity. As prefatory comment to the survey’s results, 

it is important to note that, on average, at least historically, roads 

and bridges constituted 40 percent of the industry’s sales volume. 

Today that percentage is surely considerably higher. 

47 

Of those NSSGA producer members responding to the survey, we 

are seeing some specific positive regional impacts in the Northeast 

and in the Midwest. While the majority responding had not yet 

seen a noticeable sales increase over the last three months, we believe this is due in part to stimulus projects taking longer than expected to advance to the actual construction phase in some places. 

But we also believe the stimulus has prevented significant erosion 

to the workforce in the transportation construction market of our 

industry. 

About one-third of the respondents to our survey think 2010 will 

bring a sales increase. However, when asked about their 2010 

State transportation budgets, the majority surveyed responded that 

the State budgets are expected to be down, if not level, with 2009. 

The balance were hopeful that State budgets would increase. 

Indications are that about 25 percent of stimulus projects will 

commence in the second half of 2009, with most of the remainder 

in 2010. Accordingly, stimulus will have a significant positive impact on construction activity and employment. However, some beneficial aspects may be muted by State and local governmental 

budgetary difficulties, as discussed here earlier. 

Further, though challenging to quantify, jobs have been saved 

due to the investment of stimulus. Despite the efforts of this Committee, slow progress on reauthorization of the highway bill is retarding construction activity due to States’ inability to plan for 

multi-year or major projects. 

Mr. Chairman, our industry has experienced its most significant 

decline since the Great Depression. For example, our 2009 midyear numbers at Martin Marietta reflected a peak to trough volume decline of 34 percent. In real terms, this means a drop from 

205 million tons in 2006 to around 130 million tons by the end of 

this year. Our workforce has been significantly reduced and remaining employees are working fewer hours with little or no opportunity for overtime. Our capital expenditures, which last year were 

around $260 million, will be reduced by nearly $100 million this 

year. 

In conclusion, let me be clear. The aggregates industry has benefitted from stimulus and we are indeed grateful. Importantly, it has 

served to put something of a floor beneath our volume decline, as 

well as save jobs. However, we believe any momentum generated 

by stimulus will be in peril if Congress fails to act sooner than 

later on a well funded, multi-year surface transportation bill. Our 

transportation infrastructure is the very foundation of America’s 

economic stability and growth, and has fostered its global competitiveness for over half a century. 

Yet, today, 33 percent of our major roads are in poor or mediocre 

condition; 36 percent of major highways are congested; over 

160,000 miles of Federal aid highway pavement is rated unacceptable; over 150,000 bridges are structurally deficient or functionally 

obsolete; and the current backlog of needed road, highway, and 

bridge repairs totals $461 billion. Our Nation’s transportation infrastructure must be a top priority, with all the stakeholders working together to build a transportation network of the 21st century. 

Mr. Chairman, these are serious short-and long-term issues. We 

are grateful for the attention, sensitivity, and vision you have 

48 

brought to this debate, not just today, but, indeed, for many years. 

Again, I thank you for the opportunity to testify here today and 

look forward to any questions that you may have, sir. 

Mr. OBERSTAR. Thank you for your kind words, thoughtful words 

about my work, more importantly, that of the Committee, especially the homework that you and all the members of the panel 

have done. You have the numbers right. The need is great and I 

appreciate again your support for the six-year bill. 

Mr. NYE. Thank you, sir. 

Mr. OBERSTAR. Mr. Soubry. 

Mr. SOUBRY. Thank you, Mr. Chairman and Members of the 

Committee. My name is Paul Soubry, and I am President and Chief 

Executive Officer of New Flyer of America, a company you know 

well. We are the largest manufacturer of heavy-duty transit buses 

in the United States and Canada, and since 1930 we have delivered over 23,000 buses. In 2008 alone, over 40 percent of the buses 

delivered in North America were from New Flyer. 

New Flyer has manufacturing assembly facilities in Minnesota 

and after-market parts distribution centers in Kentucky and California. We employ over 1,000 employees in the United States. We 

have business relationships with over 240 transit properties, including 20 of the largest 25. We have been the innovation leader 

in the heavy-duty transit space, the first in North America to offer 

low floored standard and articulating buses, natural gas buses, 

low-emission hybrids, and we are the only North American manufacturer of all-electric rubber wheeled trolleys. 

We have continued to pursue green technologies. We are currently building a zero emission hydrogen fuel cell fleet of buses 

that will be showcased at the 2010 Winter Olympic Games. And I 

am proud to report that just two weeks ago we delivered our very 

first production bus off of that order. 

As you know, on January 22nd of this year, my predecessor, 

John Marinucci, the former President and CEO of our company 

and now a director of New Flyer, testified before this Committee 

in support of transportation funding contained in the American Recovery and Reinvestment Act. He noted that funding of private 

transportation authority means—he knows what it means to purchase desperately needed new buses for transit authorities. In fact, 

the APTA, or the American Public Transportation Association, has 

data that shows that over 20,000 buses, or more than one-quarter 

of the fleet in America, are currently operating beyond their 12- 

year economic life. As you know, this life cycle is set by the FTA 

and is a threshold for eligibility for FTA funding of replacement vehicles. 

Given the significant and unprecedented pressure on the operating budgets on our transit authority customers, new equipment 

substantially reduces or eliminates inefficient deployment of urgently needed State dollars and local dollars to keep aging and unproductive buses on the road. New buses produce significantly 

fewer pollutants, have much better fuel economy; they are quieter 

and they are safer, far safer than the vehicles that are being replaced. All of this contributes to making a better public transit network throughout the United States, with significant reduction in 

reliance on foreign oil. 

49 

I am here today to report that New Flyer has received orders 

from over 17 different transit authorities across the United States 

totaling 638 equivalent units that can be tied directly to ARRA or 

stimulus funding. This funding was provided directly to our local 

transit authorities. This quantity represents approximately 30 percent of our company’s annual production. These orders provide over 

800,000 hours, or 447 person years, of direct labor. The spinoff for 

our component suppliers, whether it be spare parts, material, or 

services, is six times that of the direct labor in our facility, or 2,682 

person years, directly tied to the ARRA funding. Thus, our U.S.- 

based supplier partners, who provide 82 percent of all of the material or content that goes into a bus, are located in 30 States across 

this Country. All have benefitted and multiple communities have 

benefitted. 

In addition, what is important, what Secretary LaHood told us 

and Vice President Biden, when they visited our facility earlier this 

year, stimulus money is as much about job creation as it is job retention and making sure we have sustainable businesses. All of 

those buses that are being purchased as a direct result of stimulus 

are being built either in 2009 or 2010, and that is job retention. 

We believe that the ARRA funds have had a direct and material 

impact on new bus purchases and the significant domestic industry 

that designs, supplies, and builds these vehicles for such critical 

and essential service to the American people. 

The employees of New Flyer and our partner suppliers from all 

across America are tremendously grateful for the stimulus support 

for our customers. The reality is we have had a setback, which was 

talked about earlier today, in terms of a State government unable 

to fund a certain contract. The reality of it is ARRA funds has 

helped us sustain our business and our order book going forward. 

Every single dollar that comes out of stimulus has a tremendous 

impact on us and our customers and our suppliers. Orders and options exist, as you know. New Flyer has over 2500 firm orders and 

6,600 options. Every single dollar helps with significant job retention and job creation. These are high-value, knowledge-based jobs 

in an industry that is in direct compliance with DBE safety and 

promotes diversity. 

The infrastructure is aging. As I mentioned, over 20,000 buses 

are over 12 years old. The productivity and operating costs of local 

State transit authorities is significant. The pressure on reducing 

those costs is dramatic. New buses help reduce that operating cost 

requirement. The environmental impact of these new buses cannot 

be understated. Over 75 percent of our backlog are clean energy 

buses, with clean emissions; hybrids, natural gas, electric trolleys. 

And now, as I said, we are now delivering hydrogen fuel cell buses. 

There is a tremendously widespread benefit to Americans. Our 

options are across 16 different States from 30 different customers, 

and our American supply base provides 82 percent of the parts. 

The accountability for every dollar spent has huge resonance with 

this Committee. Transit assets investment can put people to work 

immediately. The investment of $1 billion creates 44,500 person 

years of employment. In addition, the return on investment is immediate. With more stimulus and additional stimulus and support 

50 

from the States, we can continue to put people to work immediately. 

Thank you for your time. 

Mr. OBERSTAR. Thank you very much, Mr. Soubry. I have been 

to New Flyer several times over the years. I was there for the 

groundbreaking for the construction of the new facility; shepherded 

the access road funding through the Committee and through the 

State DOT; am pleased with the management and the leadership. 

You have gone through some changes, I know, over time. The original Dutch investors have moved on, but they had the vision, they 

had the sense and direction of taking this company, and I am very 

proud of what New Flyer has accomplished. I will come back to you 

a little later. 

Mr. Taylor, we look to you for some lessons learned from the Recovery Act funding, and the floor is yours now. 

Mr. TAYLOR. Mr. Chairman, Members of the Committee, it is a 

pleasure to be here today, and thank you for the invitation. I am 

here to testify on behalf of Elkhart County Government and our experience with the stimulus thus far. 

Mr. Chairman, in February of this year, President Barack 

Obama traveled to Elkhart County, Indiana, to announce a bill before Congress, the American Recovery and Reinvestment Act. Elkhart County was billed as ground zero of the economic fallout due 

to the recession. At the time of our President’s visit to Elkhart 

County, unemployment stood at 15 percent, with much of it attributed to the fallout from the RV industry. You can imagine the excitement spurred in the community by the prospect of jobs to be 

created by the legislation and the potential impact of families in 

the Elkhart area. 

The announcement that $27 billion of ARRA funds to be dedicated to infrastructure improvement really caught our attention. 

Elkhart County was and still is optimistic that the infusion of construction dollars into our local economy could and will result in economic relief. Many workers and their families in the community 

were and still are facing mortgage foreclosure and bankruptcy. Unemployment had blossomed from 4.4 percent in July of 2007 to 18.9 

percent in March of this year, and today that rate hovers somewhere around 15 to 16 percent. Mr. Chairman, any kind of relief 

is welcomed in Elkhart County. 

Soon after the announcement was made that funds were available, we in Elkhart County rolled up our sleeves and went to work 

aggressively pursuing funds for road projects that were deemed 

shovel-ready. We saw this as an opportunity to complete some longoverdue road construction projects and, more importantly, put 

many of the thousands of unemployed in our region back to work. 

We employ people regionally in Elkhart County. 

Like many other local governments, we found ourselves in a disadvantage for having a well planned transportation improvement 

program based on a pay-as-you-go philosophy. We maintain a 10- 

year capital improvement plan that is funded. 

Shovel-ready projects meant having a road or bridge project design completed, the right-of-way purchased, and all environmental 

approvals in hand. The system is structured that smaller counties 

are at a disadvantage. We will not go through a process of spendVerDate Aug 31 2005 10:49 Dec 23, 2009 Jkt 000000 PO 00000 Frm 00120 Fmt 6602 Sfmt 6602 P:\DOCS\52650 JASON
51 

ing tax dollars for a project design, acquiring right-of-way, displacing our residents, securing final approval from the State DOT, 

and allowing federally funded projects to move forward without 

planning for the financial resources in advance. 

Our desire was to utilize the funds to construct another section 

of an important four-lane road connecting two vital manufacturing 

and supply bases. We learned the project did not qualify for shovelready, even though the design was complete, the right-of-way was 

purchased, affected residents were relocated, the environmental assessment was complete. Unfortunately, the project did not have 

final approval from the State DOT, and acquiring such could take 

months, going far beyond the time frame for utilizing ARRA funds. 

We soon discovered there was an enormous amount of paperwork 

required for even a simple roadway paving project. Nevertheless, 

we filled out all the documentation, submitted the photos, construction plans, cost estimates, and everything else, completing the requirements to permit the project to be constructed. To date, Elkhart County has completed all of the required submissions for the 

various roads to be resurfaced. According to reports, our projects 

are slated for a November bid letting. Consequently, it will be April 

2010, at the earliest, before we see any new jobs created or retained locally. Some of the contractors I have talked to are looking 

at running at 50 percent capacity and about 20 percent unemployment in their construction sector. 

More discouraging is the distribution of nearly $18 million in 

rural stimulus funds allocated to our region of Northeast Indiana. 

Elkhart County has been allocated zero dollars so far from this 

funding source. Awards of rural stimulus dollars were made available on a first come, first served basis. Elkhart County did not get 

ahead in the race with other cities and counties, and we were told 

at this point that our request cannot be funded because all of the 

money has been obligated to requests that came in ahead of ours. 

Our concern is that if ARRA is to be focused on jobs creation and 

retention, then it seems appropriate to target rural stimulus funds 

to areas based on unemployment and prioritize those funds accordingly. Rather, Elkhart County, which leads the State of Indiana in 

unemployment, has not received any allocation of rural stimulus 

funds. 

It was my understanding, along with millions of other Americans, that ARRA was a jobs creation and retention bill. Mr. Chairman, I believe Congress and President Barack Obama intended it 

to be a jobs creation and retention bill. If it is true we are in an 

economic crisis, we should expedite the paperwork process at all 

levels, not just Federal, and target those areas hardest hit by the 

economic turndown. 

Mr. Chairman, Elkhart County will bounce back. We have and 

will continue to aggressively pursue investments in our local economy. Elkhart County has submitted a shovel-ready project requesting TIGER. This set-aside is for distressed economic areas for 

transportation projects and we think we have a project that will 

significantly impact our region. 

Be assured, Elkhart County is not looking for Government handouts. We see stimulus as an investment to jump start our local, regional, and State economy. Our residents are working, creative, 

52 

and are noted for starting successful long-term businesses that impact the Nation and the world. 

Mr. Chairman, I thank you again for the opportunity to speak to 

you today and I look forward to answering any questions you might 

have. 

Mr. OBERSTAR. Thank you very much for coming, Mr. Taylor. I 

will have some follow-up questions, as I think there are some lessons to be learned from your experience. 

First, Mr. Cox, I took particular note of your comment our highways are a bridge for through traffic, trucks and tourism. You cited 

the plethora of units of the National Parks system in Wyoming, 

Montana, Colorado region. That is so true; there are a number of 

States that are sort of passed through, they are on the way to— 

traffic that is on the way to other destinations. They are still using 

your roads and you are having to sustain that road system and improve it. 

But how were you able to come out of the gate so fast, get your 

Recovery Act application ready and submitted? What was it that 

you did that might be different from other States? 

Mr. COX. Mr. Chairman, I don’t know how to comment about the 

experience of other States, but I can tell you what worked in Wyoming. Former Governor Sullivan has coined a phrase that Senator 

Craig Thomas used to use back here in Washington. He said Wyoming is a small town with really long streets, and the commentary 

was aimed at the fact that in Wyoming the culture is relationally 

based, which is to say that you don’t get things done if you don’t 

have relationships built from border to border. But you can get a 

tremendous amount done in a short period of time with that kind 

of neighborly ethic that exists in the State. 

Mr. Chairman, to start with that kind of as a big picture ethic, 

I would tell you that what worked well for us was a genuine roll 

up your sleeves and work together, not only starting with Governor 

Freudenthal and his kind of taking command of the ARRA possibility at that point, very early on, when it was really conjecture 

what was going to happen, and beginning to form up a template, 

if you want to call it that; and, frankly, his and our behind-thescenes work with Members of our legislature to the point that 

when the Recovery Act become a reality, we simply had not only 

the approval, but the permission of the politicians in our State, the 

elected officials in our State to stand back and allow the already 

established process to carry through the implementation of these 

funds. 

There are two other groups that I mentioned in my spoken testimony that I need to reiterate here, too. Again, the same relational 

approach applies with Federal highways. We are on a first name 

basis with Phil Miller and his staff, so early on, when this was a 

possibility or a probability, and not a reality yet, we were working 

with Phil and his staff, and also with the Wyoming Contractors Association, Jonathan Downing and his people. They literally sat 

down at the table with us so we could examine every aspect of not 

only the projects that we had designed and on the shelf, which was 

three times what our annual Federal program would fund, but we 

also examined whether or not the contractors could deliver the capacity. That was a real concern for us because we knew we would 

53 

hit the ground running. And Federal Highways was a partner in 

that conversation as well. 

So it was a combination of a number of elements, but really it 

boiled down to a bunch of committed people working together. 

Mr. OBERSTAR. I think that is very instructive. It is very important not only for recovery, but for our follow-on six-year program. 

You cited this coordination, this working together with the governor and State legislature, you mentioned. There were several 

States whose constitution requires the State legislature to approve 

their State DOT acceptance of Federal funds. Not all States have 

that requirement; some it just goes ahead, but others. So in some 

States the legislature had to be convened, if they were not already 

in session, and had to approve legislation to allow the State to accept the Federal funds. 

But you apparently foresaw all of this; you brought the entities 

of government together. Early on in the process Federal Highways 

was holding informational sessions, either in person or by teleconference. Did you participate in those? 

Mr. COX. Mr. Chairman, our people did participate in those. 

Mr. OBERSTAR. Not you particularly, but I mean your Department, yes. 

Mr. COX. Yes, sir. Our people were daily involved in those, and 

it really did help to set the stage. Wyoming is one of those States 

where, statutorily, the carrying out of Federal disbursement of Federal Highway funds is tasked to a commission, and in this particular case those informal conversations led to the legislature simply trusting the commission with that same process. So we were 

able to use a very familiar process to carry out this extraordinary 

opportunity. 

Mr. OBERSTAR. And does Wyoming DOT have a portfolio of 

projects, highway projects, that are in a state of disrepair and need 

to be brought up to the AASHTO standard of state of good repair? 

You have a catalog of such—— 

Mr. COX. Mr. Chairman, we do indeed have a list of such 

projects, and we were able, incidentally, to use ARRA funds to 

stave off or to prolong the life of some of those that were in decline. 

Mr. OBERSTAR. And all of those are projects in which the rightof-way is acquired, the EIS and other permitting have been completed, correct? 

Mr. COX. Mr. Chairman, it would be accurate to say that the EIS 

has been complete in most of them, at least to the extent that it 

could; and right-of-way acquisition may not have yet taken place, 

but we know what we need, so we are ready to go with that if the 

funding were in place. 

Mr. OBERSTAR. But on the one submitted for recovery, those aspects of the process were already in place? 

Mr. COX. Mr. Chairman, yes. 

Mr. OBERSTAR. That is what I intended in 2007 when we first 

proposed this stimulus, in 2008 when we moved the bill through 

Committee, through the House. We were very clear about it and I 

had numerous conversations with AASHTO, with ARTBA, had several revolving conversations with State DOT directors—I don’t recall that you were involved in any of those—saying this is what we 

are intended to do, now, be ready for it. I really don’t have any 

54 

sympathy for States at this stage who come in and say, well, we 

didn’t know this was happening. Baloney. You were all on notice. 

Everybody knew this was coming and you were readiest of all. 

In Minnesota, after the bridge collapse on August 1st, 2007, I remember it so well. Mr. Mica and I were actually on the Floor together managing the conference report on the Water Resources Development Act, which hadn’t passed Congress in six and a half 

years, and we were finally getting this major bill passed and eventually, parenthetically, President Bush vetoed it and we overrode 

the veto. Bipartisanship is alive and well in this Committee, I can 

say that. 

And I got the notice on my BlackBerry that a bridge had collapsed. I thought it was in some third world country. When I 

looked closer, it was Minnesota. But in 437 days they rebuilt that 

bridge. In 48 hours we had a bill through Committee, through the 

House, through the Senate to provide the emergency funding for 

Minnesota to rebuild that bridge. Of course, that helped immensely, and it was 100 percent Federal funding, just like Recovery Act funds. 

So now to my point. The contractor was on one wing of the building where they had their plans, designs, engineering work; Mn/ 

DOT, Minnesota DOT, was on the same floor on the other wing of 

that building; and Federal Highway Administration was also on 

the same floor on the south wing of that building. They didn’t send 

emails; they walked down the hall with their engineering plans 

and looked at it and said, all right, this is good, this is not good, 

we have to change this, change something else. There was instant 

communication. They didn’t have to go through hoops because they 

talked with each other. 

Now, that is the sort of spirit that I want to inculcate into the 

next transportation bill to expedite permitting, to expedite process 

and projects coming through. 

Mr. Cox. 

Mr. COX. Mr. Chairman, in a very rural kind of comparison to 

the I-35 bridge tragedy, we had a tragic incident on the Wind River 

Indian Reservation in Wyoming, where a bridge was hit by a motor 

vehicle and there were some fatalities involved in that, and it destabilized that bridge. That is the bad news, the terrible news. 

But the good news was that in a very short period of time our 

State DOT and the Reservation Department of Transportation 

were able to collaborate and get a temporary bridge in place using 

our equipment, and then to rebuild that bridge in a very short period of time. So those kind of cross-boundary and cross-discipline 

cooperations are, I believe, alive and well. Unfortunately, sometimes it is on the heels of a disaster, rather than in the everyday 

sense. 

Mr. OBERSTAR. Yes, you are quite right, and I thank you for 

those observations. I was going to ask you about the provisions of 

our authorization bill that deal with rural transportation, but I 

have just received a notice from the Floor; we are likely to have 

votes in about 15 minutes, so I will let you mull that over and give 

us your thoughts at a later time. 

Mr. Gallagher, your company has seen it all, on the threshold of 

the Great Depression to its cousin, the current one. 

55 

Mr. GALLAGHER. Yes, sir. 

Mr. OBERSTAR. Your company has remarkably—I love these companies that are family owned and second and third generation. You 

really invested in your company’s success and there is a certain 

kind of personal family pride. We have a number of such construction companies in my State and in my district. 

You said that a number of contractors have been bidding low. Is 

that because materials costs have come down as the Chinese and 

Indian economy flag and their pressure on world materials slacken, 

or is it just because of the downturn in the economy and more contractors are bidding and willing to cut costs in order to win the 

project? 

Mr. GALLAGHER. Mr. Chairman, I think it is both. I think that 

the material pricing has softened; crude oil has come down, so liquid asphalt has become less expensive. But I think, by and large, 

it is a number of contractors are into a panic mode, that they don’t 

know what is coming next, so they are bidding as though they will 

never see another job, and that is a very dangerous environment 

for everyone, for that contractor and for the people that work for 

them. So we see a number of jobs being bid very, very aggressively 

because they don’t know what the next program—— 

Mr. OBERSTAR. Well, the Recovery Act is accounting for callbacks, restoring jobs for contractors. Eventually, that money will be 

committed, funds will be paid out, the program will come to an 

end, and we need a sustained program. 

Mr. GALLAGHER. Yes, sir. 

Mr. OBERSTAR. And what is that sustained program? 

Mr. GALLAGHER. The reauthorization, sir. 

Mr. OBERSTAR. All right. There we are. Terrific. You get the class 

award. 

I mentioned the Knife River Construction Company earlier, the 

truck driver who told the story sitting at the kitchen table, her 

husband also a truck driver for that company. Knife River kept 

their employees on health insurance program alive through December. They had no jobs, they had no contracts, they had nothing in 

prospect. It cost them $300,000; actually borrowed money to keep 

their employees’ health insurance at least through the end of 2008. 

But then that ran out and that was unsustainable for them. 

I am sure that there are a number of ARTBA members across 

the Country that have had similar experiences and done their best 

to keep their workforce together. And keeping that workforce together was one of the reasons we said retain or create new jobs in 

crafting the language for the Recovery Act. Do you know of others 

who have had a similar experience? I think these are great human 

interest stories. 

Mr. GALLAGHER. Certainly, sir. We all really do look at our employees as—or I know at Gallagher Asphalt we do, we look at our 

employees much differently than just a number, just a person. We 

have over 20 different family relationships in our company; if it is 

a husband and wife, father and son, brothers, sisters. 

So everybody is very connected, and when we need to lay somebody off, it is not a simple thing because they are connected to people who are being laid off or people who are able to stay. We try 

very hard to work with the most motivated employees to make sure 

56 

that they have health care so that they can have health care 

through the winter, that they have enough hours banked, as you 

have talked about, to allow them to sustain their health care coverage throughout the winter layoff. 

But, again, it can’t go on forever. But we do take it very personally in our decisions of overhead reduction and employee layoff; it 

is not as simple as just looking at numbers on a page, these are 

real live people that we know the names of and have shared a lot 

with. 

Mr. OBERSTAR. I have traveled to so many recovery sites. Not as 

many as the Secretary because I have to stay here and vote. He 

understands that very well. But I have heard this story from so 

many contractors across the Country. It is a great human interest 

story; it puts a face and heart on the ARTBA members. 

Just as Mr. Nye and members of your association, the same. I 

have been to a number of sand and gravel operations that were 

closed. Forty percent in the State of Minnesota were closed; it got 

up to 60 percent. Now, in anticipation of the Recovery Act, they 

started reopening. Even though it was January and February, they 

began work preparation, calling people back and saying we anticipate projects. 

And I thank you for your support, but, again, sustainability is 

the important element of the surface transportation program and 

I don’t expect there will be another Recovery Act. The real longterm stimulus that will create 6 million new jobs and sustain 3 

million jobs is the surface transportation authorization that we 

have moved through Subcommittee. I think that that is what your 

members have expressed support for. 

Mr. NYE. It is very much what our members have said. And we 

are back to the point that was made in the oral testimony and in 

the written work as well. The vast majority of what this stone, 

sand and gravel is going to find its way to will be infrastructure 

projects. That will simply be the driver. But every other component 

of the economy has also been heavily damaged. 

What we have seen in commercial has been the greatest drop 

that we could ever have imagined. People didn’t just finish commercial jobs, they walked away from commercial jobs. There is simply nothing going on in housing. And our view is exactly what 

yours is, Mr. Chairman, and that is if we have a firm six-year bill 

that this industry and the construction industry knows it can count 

on, it is going to spur growth, it is going to spur opportunity not 

just in transportation, not just in infrastructure, but everything 

that will spin off of that is going to be a remarkable economic vehicle going forward. So we see this as an incredible opportunity and 

one that is much needed sooner, rather than later, not just to get 

the largest component of our business going, but, indeed, every 

component of all of our businesses going. 

Mr. OBERSTAR. I am going to see to it that the Chairman of the 

President’s Council of Economic Advisors gets the testimony from 

this panel and reads it. I have said several times that what we 

need is not a council of economic advisors, but a council of engineering advisors to get the Country back on track; get those economists, put them off in a corner someplace. 

57 

Knife River, the company I have cited as one of several that I 

met with who said that 50 to 80 percent—in their case it was 80 

percent of their work—was private sector—shopping centers, parking lots, various other private sector projects—before the collapse 

of the economy. Since Recovery Act, 90 percent of their work is 

public sector, that is, Recovery Act. I wonder if you have—now, 

your members are not directly involved in the pavement work, but 

you are selling to and you are supplying those who are. Have you 

seen that? 

Then, Mr. Gallagher and Mr. Cox, I will ask you the same thing. 

Mr. NYE. We have certainly seen those types of percentages move 

around. In fact, Knife River would be a member of the National 

Stone, Sand & Gravel Association, as well as ARTBA, so we know 

that company quite well. And the type of migration that Bill 

Schneider or others in that business would have described would 

have been a very consistent migration for our membership as well. 

Mr. GALLAGHER. We are certainly seeing that same shift. The 

previous three years our company had roughly 50 percent of its 

work came from the private sector and 50 percent came from the 

public sector. Currently, 98.5 percent of our business is public sector work, with only 1.5 of private work. It literally has just dried 

up and blown away. 

Mr. OBERSTAR. My goodness. 

Mr. COX. Mr. Chairman, Knife River does a considerable amount 

of work for WYDOT in Wyoming. 

Mr. OBERSTAR. Oh, really? 

Mr. COX. In our world, they represent a conglomeration of companies that used to be separate, smaller outfits that were assimilated by Knife River, and they are one of our best contractors in 

the State. 

Mr. OBERSTAR. Well, I think there is a lesson here. It is going 

to take much longer for the private sector to enjoy recovery, and 

that half to 50 or 60 percent of your work that was private sector 

stimulated or generated has been replaced by the public sector. In 

other words, we will need to sustain the public sector investment 

for your companies to sustain their activity for some period of time, 

until that recovery filters through the economy. 

Mr. NYE. That is entirely true. 

Mr. GALLAGHER. Yes, sir. 

Mr. OBERSTAR. Mr. Soubry, in the unfortunate situation that 

New Flyer experienced in Chicago—and you heard my comment 

earlier. When your staff called my chief of staff and said we have 

a real problem here, I called Mayor Daley and talked to him and 

then talked to his chief of staff, Frank Kruesi, who looked into the 

matter and said CTA has just lost revenue; our revenue base has 

declined so seriously that without the Recovery Act we wouldn’t be 

buying any buses at all. 

So I want to place it on the record CTA is very high on New 

Flyer, they like your equipment, they are buying what they can 

through the Recovery Act, and if their economy or when their economy recovers and the revenues are back, they will come back to 

those buses. But I know that was a great disappointment for you. 

But MARTA has also purchased and I know that I am seeing on 

the streets of the District of Columbia New Flyer buses. 

58 

Mr. SOUBRY. Yes, Mr. Chairman, thank you, you know, sincerely 

on behalf of our company for making those inquiries. Some of it 

was trying to understand the facts associated with the deferral of 

the order and so forth. As you know, in Chicago, the CTA needs 

the buses. It is not a matter of need, they have an aging fleet. They 

have had some issues over the last couple of years with another 

style of bus they had problems with. So it is not a need issue; we 

understand it is a State funding issue. 

In fact, as you know, CTA bought 58 buses directly tied to the 

stimulus money that came out of this Committee and that was 

greatly—in fact, we have a number of properties that have benefitted. Just to list, Philadelphia, Seattle, Washington, UC Davis, 

Rochester, Milwaukee, Charleston, Detroit, Boston, Honolulu, Cincinnati, Miami, New Orleans, Fargo, Morehead, Guardian of California, and some from Chicago. So clearly the stimulus dollars have 

made its way across America and has benefitted those that could 

take advantage of it in a shovel-ready or a purchase order ready 

format, and that has been very successful; and it has benefitted 

New Flyer, but it has also benefitted those 30 suppliers that we 

have that are rippled throughout the United States, or those 30 

States. 

Mr. OBERSTAR. You anticipated my next question, which was you 

have suppliers who provide parts for the buses and they are scattered all around the States, and those are jobs as well, right? 

Mr. SOUBRY. Absolutely, sir. As you know, our industry, we are 

an assembler, so we design and assemble buses, whether it is us 

or our competitors. The ripple effect on the supplier community 

and then down to the raw material suppliers is absolutely tremendous. So, as we have kind of stated, it is almost a six to one ratio; 

every job that is saved or created in our specific space or in our 

company ripples back through the supply community to a tremendous multiple. 

Mr. OBERSTAR. You probably don’t want me to mention your competitors, but they are out there as well, Gillig, Van Hool, Orion. 

Are they experiencing similar upticks in production? 

Mr. SOUBRY. Well, every one of them has—you know, we are in 

a solid industry, we are in very good competitive business, we have 

tremendous domestic capacity and end capability, and there is 

room inside our facilities to do the work that we are contracted for 

and more, so we are going to see hunger on behalf of us and our 

competitors to try and retain our market shares and grow them. 

Every one of them has, in some way, shape, or form, benefitted 

from the ability to deploy stimulus dollars very quickly. 

Mr. OBERSTAR. Thank you. In our authorization bill, we listened 

to the various transit agencies across the Country who are concerned about their operating expense and their capital account, and 

want to increase the amount of funding they can use for operating 

expenses out of their capital account. I would like you to—and we 

will see that you get a copy of the language that we have crafted 

in the bill. 

But we limit that to only 5 percent for the biggest systems, those 

above a million population, and allow substantially greater 

amount, to 50 percent, for those under 200,000. But I would like 

59 

you and your colleagues in the supply side to look at that language 

and see what your thoughts are about that. 

Mr. SOUBRY. I think that is very, very important, sir. As you 

know, there is a real economy around the investments of new technologies, therefore, the direct reduction in maintaining or operating 

older fuel inefficient buses, and then there are safety issues and so 

forth. So that is a critical life butt of our industry, and we are 

under no illusion, the local transit authorities have to change the 

way they do business and reduce their operating costs, and it is incumbent on us as an industry to try and help facilitate that by continuing to offer fuel-efficient equipment that can be purchased at 

the right capital price. So we would love that opportunity. 

Mr. OBERSTAR. There is a matter of principle involved here. The 

principle thrust of the Federal legislation is to provide the capital 

assistance to transit agencies to buy the equipment, then it is up 

to them to operate and maintain it. And the more money that goes 

into—if more money from the Federal side goes into operation, 

there will be less money for new capital. We have always seen the 

role of the Federal Government as being to increase the investment 

in the capital rolling stock, rather than in the operation account. 

It is a similar principle for the Federal Highway program as well. 

It is only recently, and by that I mean only the last 25 years, have 

we increased the amount for maintenance of the system. 

Mr. Taylor, some lessons learned. In following your experience, 

I inquired with Indiana DOT. They said that some 10 projects have 

been approved under the Recovery Act for Elkhart County, totaling 

$23 million, and five are underway or have been completed. Can 

you validate that figure? 

Mr. TAYLOR. There are some State level projects, Mr. Chairman, 

that are underway, funded through DOT. I can’t comment on a 

whole lot of those projects because they are Indiana DOT projects 

and not from Elkhart County. 

Mr. OBERSTAR. So, to the best of your knowledge, it is not 10 Recovery Act projects in Elkhart County, but 10 projects in all that 

may involve either State funds or regular Federal Aid Highway 

funds? 

Mr. TAYLOR. No, my understanding is there are ARRA-funded 

State projects bid through INDOT. What I am here today to address is the difficulties we are having as a county getting our portion of stimulus funding that flows through either our MPO or 

through State funding, the rural stimulus funding pot of money, if 

you will. That is not working as well as the projects that you are 

mentioning. 

Mr. OBERSTAR. Well, you are out there on the front line, and so 

you should know, as the county engineer, whether these are Recovery Act funds or whether they are State funds only or Federal aid 

State projects under the 80/20 program. And I have asked your Indiana DOT and they told me that, additionally, $23 million has already been allocated under the Recovery Act for Elkhart County 

and that 3 additional million dollars will be committed, and that 

they also approved an airport project of $4 million on Recovery Act. 

Mr. TAYLOR. The airport project was for the City of Elkhart, 

which is a place that President Barack Obama visited, and that 

60 

project, the $4 million project, is complete. So that was a successful 

project. It was bid and it is done. 

Mr. OBERSTAR. Was it a runway, do you know offhand? 

Mr. TAYLOR. It was a runway, yes. 

Mr. OBERSTAR. Runway extension? 

Mr. TAYLOR. Yes. 

Mr. OBERSTAR. So that was done. Well, airports have a different 

contracting authority; they can move faster. So there is a question 

about how much of that $26 million was Recovery Act funds and 

how much was 80/20 funding or maybe some State funding altogether. 

The second question, then, is the allocation. Under the Recovery 

Act, we directed States, State DOTs, to, on a priority basis, allocate 

funds to counties of highest unemployment as measured by the 

U.S. Economic Development Administration. They do it for the 

whole Country, county by county. Elkhart County obviously is one 

of the highest unemployment counties in the Country according to 

the figures from EDA. Did that not argue in your favor? 

What happened at Indiana DOT that they did not give you—first 

of all, where does your county unemployment rate rank within the 

State of Indiana? 

Mr. TAYLOR. Number one. 

Mr. OBERSTAR. All right. So under the terms and conditions of 

the Act that we passed and the President signed, Indiana DOT 

should have given Elkhart County priority consideration. 

Mr. TAYLOR. That is correct, Mr. Chairman. 

Mr. OBERSTAR. Why did they not? 

Mr. TAYLOR. That is a very good question that probably needs to 

be posed. 

Mr. OBERSTAR. I asked that question and Indiana DOT said it 

took Elkhart County two months to submit their projects. Is that 

correct? 

Mr. TAYLOR. Two months to submit our projects? In April we 

began filling out paperwork for the projects to submit. Photos were 

submitted as required. 

Mr. OBERSTAR. Okay. 

Mr. TAYLOR. And I don’t know that time allows me to go into all 

of the details. I will take all the time that you would like. 

Mr. OBERSTAR. Ship those details. I don’t want to set up a conflict between you and Indiana DOT, but this is your opportunity to 

tell your story, and I am asking the questions because we are 

crafting this new bill. 

Mr. TAYLOR. Yes. 

Mr. OBERSTAR. And I want to see what we can do in the future 

for the regular program to cut out these kinds of disconnects. 

Mr. TAYLOR. Understood, Mr. Chairman. We attended a meeting 

early on at the Fort Wayne District of INDOT in Fort Wayne, Indiana, where all of the local government entities were told what the 

plan was for rolling out this program. We were told it was going 

to be a first come, first served program. In other words, those entities that went home, got busy, got the paperwork in on time and 

correct were going to be the first to receive. I may be mistaken, but 

I don’t recall any language about distribution based on economic 

need or unemployment. 

61 

Mr. OBERSTAR. It is in the law. I wrote it into the law. I insisted 

on it in House-Senate conference and it is in the law that the 

President signed. So they didn’t tell you about that. 

Mr. TAYLOR. We took photos, we filled out reports, submitted 

them to INDOT. They were returned to us, said you didn’t take 

enough photos to show all of the pavement distresses that are required in order to justify this segment of road as being resurfaced. 

Mr. Chairman, we have design engineers on staff who have designed, currently, $19 million bridge. The largest pre-engineered 

arch structure in the United States was designed in-house by our 

staff. I think we can determine whether a road needs to be paved 

or not. Yet, these forms were returned to us, only to be revised and 

sent back again and again. When you do that, you fall at the end 

of the line and the money had run out by that point. 

Mr. OBERSTAR. You know, I have enormous respect for county engineers. I have 17 counties in my district. I meet with each of them 

in the course of a year, and one of the county engineers in my district, Dwayne Blank, was your County Engineers Association president a few years ago. I know the competence that exists at the 

county level. So there is some disconnect between Elkhart County 

and Indiana DOT. 

Now, the County Engineers Association—I am going to have to 

conclude here because I have a minute to get to the Floor and 

vote—has asked, over time, for a separate allocation under our 

Federal Aid Highway programs of funds to go directly to counties 

by percentage allocation. I suspect you would like that idea and I 

suspect that you think it would be a good thing, rather than having 

to go hat in hand to the State DOT. 

Mr. TAYLOR. Mr. Chairman, I would welcome that opportunity. 

Our department works very closely and very well with Mr. Bob 

Talley, who is the Federal Highway representative for the State of 

Indiana who works out of Indianapolis. We work very well with 

him. We have had some challenges in the past; not with him, but 

challenges in designs and so forth, and worked very closely together to get those resolved. We would look forward to that opportunity to work through challenges of Federal aid projects. 

Mr. OBERSTAR. Well, I suggest that you talk with the National 

Association of County Engineers and perhaps craft some suggestions for us to include as we refine the future surface transportation bill. 

Mr. TAYLOR. Thank you. 

Mr. OBERSTAR. Thanks to all of you for your contributions, for 

your work on the front line of recovery, for putting people to work, 

creating jobs, moving America ahead. We will have, in another 

month, the sixth in our series of hearings, and that will be principally on EPA, the FAA, the Public Building Services, the Corps 

of Engineers under our Committee jurisdiction, where, again, there 

are people at work, getting a payroll, getting a paycheck, and making America better. Thank you all very much. 

The Committee is adjourned. 

[Whereupon, at 2:17 p.m., the Committee was adjourned.] 

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