this will help imagine the property in a more efficient manner. we will be happy to answer any questions. >> a couple questions that i want to ask. please proceed. ..

>> these underutilized buildings cost about $1.66 billion annually to operate and are potentially valuable. in designated property as a high-risk area we found there was no governmentwide strategic focus on real property issues and the governments states were unreliable and undated. since that time the government has made significant progress. the administration and federal agencies have established the interagency federal real property counsel designed to enhance real property processes and improve data reliability. based on the governments progress we removed the data element of real property management from this year's high-risk list. even with this progress the government has not yet addressed of the challenges to real property management including legal and financial limitations and stakeholder influences such as local governments, advocacy groups in the private sector.

in 2007 we recommended only be assist agencies by developing an action plan to address the key problem associate with decisions related to unneeded federal real property. omb and agreed but has yet to implement it. however, the administration recently proposed a somewhat responsive to that recommendation. separate proposed an independent board that would streamline the disposal process by deflecting properties consider appropriate for public benefit uses. this process could reduce disposal time and cause. it would also establish an asset space management fund that could be used to reimburse agencies for a necessary disposal costs. the proposed independent board will address stakeholder influences by recommending federal properties for disposal or consolidation after receiving recommendations from civilian landholding agencies and independently reviewing those recommendations. while tranninety is not explicitly to voters leasing, it could help to consolidate operations where appropriate.

mr. chairman, this concludes my statement. mike koldyke will describe the brac process. following his testimony will be happy to answer the committee's questions. >> mr. lepore? >> thank you, mr. chairman. mr. chairman, senator brown and members of the subcommittee i'm delighted to be here to have an opportunity to present our observations on the base realignment and closure, or brac process. this may be helpful to you as you consider the civilian property realignment bill. i would address two points today, the 2005 brac process, and the department of defense's dod's key steps for developing its closure and realignment recommendations. his other 2005 brac process work. dod requested the right. congress authorized it in law, dod propose the selection criteria to be used to develop the candidate closure and realignment recommendations, and

publish that in the federal register so give everybody an opportunity to see this is what dod thought was the way to do. congress been codified the criteria in law and require dod to develop a 20 year force structure plan and infrastructure inventory. so congress essentially tightened up and said here's the deal, here's how we're going to do. dod develop the closure and realignment recommendations and sent them to the independent brac commission. the commission could approve, modify, reject or add to the recommendations based on the criteria in the force structure plan and beauties compliance with both of those. the commission held hearings, voted on each recommendation, and reported to the president. the president could just approve the report and sent back for revision or send an total to congress. congress been at 45 days to enact a joint resolution of disapproval or the recommendations become binding. now to my second point.

you are the key steps dod used to develop its recommendations. first, dod developed three goals for the brac route promoting jointness and transformation, reducing excess infrastructure, and saving money. dod use the cost of base realignment actions or cobra model to estimate the cost savings from the recommendations and to have a consistent way to compare the candidate recommendations. dod also develop a common analytical framework and organizational structure to better ensure consistent application of the criteria, and dod involved the service audit agencies to help try to ensure data reliability so that there was an accurate set of data in which to look at. this concludes my prepared remarks, mr. chairman. i would be happy to answer any questions that you are other members may have. >> thanks very, very much. sitting here listening to your testimony, there's a bible study group that meets in the capital

most thursdays when we're in session with our senate chaplain, very black. and he talks to us about how our faith guides us into work, talk to us about moral imperatives, and sometimes he shares with us matthew 25. not many people know what matthew 25 is, but maybe your family with the term, one of our obligations is as human beings to people who are hungry or thirsty or naked or sick and in prison, and so, the question i want to ask is about moral imperative. for one i think most of us view the least of these among us. they don't feel an obligation to reach out and be helpful and responsive to them with their needs. but also as legislators, those of us who serve the taxpayers of our country, we have an obligation to run our government in a fiscally responsible way. i think it's an impaired that

goes beyond fiscal stewardship. i think it's almost like a moral imperative as well. in this case what we need to do i think in part is to be consistent in addressing and being faithful to both of those moral imperative. we need to look to the needs, we need to do that in a cost effective way. senator coburn and i have been working on this. i think he was working on it when he was a house member. i've been here in the senate now for 10 years and focus for the last half dozen. i'm determined that will make real progress than happy to have an administration that shares that conviction. talk to us about how we meet both the moral imperatives. to the taxpayers of this country. please, mr. werfel. >> it's an excellent question. one of our objectives out of creating this board is to drive

a decision, not necessarily to exclude viewpoints and exclude perspectives and stakeholder interests. we're not getting around the stakeholder interest problem by saying you shall deploy with one stakeholder interest in mind, and that would be savings, or deficit reduction. i think that's an incredibly important when. and for some of these objectives i think deficit reduction will shine through as the primary objective. but i also believe that there are a lot of legitimate stakeholder interests, homeless groups being one of them. other community interests, when we vacate or rethink how we're going to use the property. and the goal here is to make sure that voices are heard, issues are surfaced and considered by a knowledgeable set of individuals, and that ultimately to make a decision that maybe not everyone is going to walk away fully happy with.

but there will be a fair and open process, and a decision will be made and we will move forward for good or for bad. and so in that way i think our goal is to strike that balance that you described, but do so in a much, much but what and what we've done today. right now the balance being achieved in a way where a lot of voices are being heard, but the result into many cases is inertia as those voices continue to dangle. what we want to do is let those voices be heard but drive to move forward which is our perception of how the brac process has worked in one of its success points, those voices were heard, decisions were made, not everyone walked away from things happy, but savings have been realized and deficiencies have been gained. >> any comments, mr. peck? >> yes, sir. the record is a public benefit conveyance is that we have done, which accounts or something like 13, 15% of the disposals we are

done in the last number of years, fewer than something like 5% of those have actually gone to the homeless. so, it's not a huge number. we should put that back in our mind. second, the administration's proposal suggests in the course of come up with a lesser properties to be disposed of, the board would consider those properties that are likely to be useful to the homeless. i suspect it would be done in consultation with homeless groups. i think we have already, we have at least begun thinking about how we balance those issues you're talking about. >> mr. sullivan, any thoughts? >> mr. chairman, i believe in the va, our moral imperative is to ensure that no matter what real property action we take, that has a positive direct benefit on veterans and their families. number one. number two, that we fulfill our mission in terms of medical, cemetery and benefit services to veterans.

and that we are compatible with the local community that we live in an operating with our va medical centers and cemeteries. but throughout that process is the secondary factor of trying to do in the most economical way. there are cases where we can use current a three to make sure we hit those three criteria into an economic way and save money which is reinvested in the back for veterans or back towards the debt. the we -- don't have cases where the hard things to do. a tool like a brac like process would be helpful where we can't get that benefit for veterans because of the existing real property configurations we have. >> thanks. mr. wise? >> senator carper, at gao generally at the request of you and other members of the senate and house of representatives we evaluate various programs. but i could say i'm a public policy perspective, you are sort

of philosophical question as it were, is i think and person speaking, not necessarily representing gao in that sense, but i think almost everybody, whether they're from and after citigroup or never of congress, wants to do the right thing. people approach it from different perspectives. i'm pretty confident that as we work through these issues and are being able to gather different perspectives from both folks like in the first panel and from this panel that it will give the congress a perspective to move forward and be able to account for the differences and come up with i think an appropriate piece of legislation that will accomplish the kind of things you are trying to accomplish year. >> mr. lepore? >> i think the brac statute may offer the model for you. as you know, the property disposal provision of the 1990 brac statute are pretty detailed. what it says essentially is the

military service that proposes to close and installation offers it within the department of defense. other installations or other military department or other organizations, if they choose not to take it, it in his native able to other federal agencies should the other federal agencies choose not to avail themselves to the installation, it then goes through a very detailed process where the secretary of defense works with local authorities to include representatives of the homeless, state and local governments participate, there are potential for economic development conveyances from public sales, for auctions, negotiated sales. there's a whole laundry list, if you will, of what the secretary of defense is required to do as he goes through the process of disposing of installations, closed under brac. that detail my offer a model for you as you think about the civilian property realignment bill. >> it occurs to me though under the example i used in dover, delaware, on the one hand you the dover air force base where

5000 people were, and five miles away you have the federal building in downtown dover were maybe 100 people work if that. do we need for the federal building in dover a brac like process to be able to dispose of them useful commonsense the way, humanely, we need the same kind of process? >> anybody? please, mr. werfel. >> i'm not exactly which exacts from -- circumstances, but when i can tell you, we have come across different real estate transmission opportunities where it is maybe not as complex as downsizing a military base, because i think it was mentioned in the first panel, shutting down a major city or a minor city. but yet it's complex enough in terms of the various stakeholder interests that historically we

have been unable to push through under the current frame. so i don't know that it necessarily as the brac like board that we envision gets together and educates and thinks about a particular building that fits the example that i provide, or going back to my earlier point about downsizing thousands of field offices across counties, both urban and rural across the united states. they might not have the same complex array of issues and immediate community impact, but i think they will get a healthy dose of very legitimate interests and concerns whether the local residents are concerned about a giant office building being replaced where green space exists now, or whether there's concerned that the local educational institutions should get the property versus the mayor versus the homeless versus -- we see the and we see those types of -- even any building potentially the same size, square footage and impact or imprint of the

dover federal building. it's a case-by-case basis and that's why i think the board we are envisioning will be somewhat surgical and we'll hear back from the agency and say here's an opportunity we are seeing this type of makeup of competing interests, or lack of financial incentive. here's what you might come in and be able to help. we think for a relatively low up front investment in this type of mechanism, the proceeds can be enormous. >> mr. peck? >> mr. chairman, the dover federal building, it's a multitenant building and is typically the kind asset you want to hold onto. is government owned. it's almost always in the best interest of the taxpayers to hold onto those, while what we might want to look at in dover is whether other facilities that we don't need. and sometimes that takes a little bit of work. i want to you why. when they ask agencies how about this property out there, and looks like you're not using it, often the answer is well, things

will change. we might need. so in essence we have some federal agencies in gs a.m. i will have to do has done this, land banking the property. be able to say to them i don't really think you need that. and it's time to move on and time to think differently about how do you function and go someplace else. that's something that we could use a little bit more clout to do. >> senator brown? >> thank you, mr. chairman. i had to go to the floor and vote on an amendment and deal with it. i appreciate you. >> you expect we will vote against a? know, there are no more votes until tuesday. mr. peck, if i could start with you i guess. gao highlighted the language in one of the issues hampering the disposal of unneeded property.

and contributing to the lengthy process is the housing use that you are from the testimony. in the past 10 years, what percentage of properties have become homeless housing, if you know? >> i think while you're out i gave one number, that's the number i think that it's at your answer, other public benefit conveyance is that we have done which are those that go, that we decide are eligible for state and local purpose, that's about 15% of the properties, and about 5% of those have gone for the homeless. >> how long, how many months or years on average does that process to consider a property to become used for homeless speak with the immediate screening process, in which involves a referral to the department of housing and urban development only takes about 60 days. and so it's not that -- that

aspect is not that long of a process. however, to be candid sometimes what happens is the process riches on after that, and various entities, public and nonprofit decide maybe there's another way to get the property, made it would be useful. >> and just for all of you, i have been running around, it's been one of those days, if you have answered i do apologize. i appreciate your consideration. and, mr. werfel, it's good to see you again. i was very impressed by your testimony before us today. i been watching to see how you've been doing and i appreciate you coming back. how does the presence proposed board streamline the process, the time-consuming process of considering property designation and homeless housing use? >> senator, thank you and thank you for those kind remarks. the streamline comes from the ability to drive to quick decision and run the processes

concurrently. so we have a lot of legitimate interests that are looking at the property and a lot of legitimate process steps that need to take place. what we want to do and we want what the board to do, a set of properties to take all those issues collectively and try to critique her decision. rather than waiting a certain number of days by the local education institution has its take of the process, then the homeless, then the local correctional facility come in the local airport and other local government entities which lengthened the overall process, the board was that everybody coming simultaneously. we will review the process. we will drive a decision that balances all and we will try to reach something that is optimal that protects the taxpayer but protects the local community. >> thank you. mr. sullivan, is it true communities have a property owned by the va in west l.a. which is worth about $4 billion

the bill prevented you from disposing the property? [inaudible] >> yes, sir. we have a large medical center in west los angeles that has ignored -- significant dating back to the 1960s and '70s the. >> and that he is determined the property is underutilized, is that right? >> we have not had any authority to determine or to speak prior to the land-use restrictions did they make that determination? >> i'd have to look pretty goes back to the 1960s. >> if they weren't in place, with the da said that, would it be reconsidered to the process we're talking about? >> i think at this point as i said when he stepped out of the room, senator, in terms of any property reliant we would first look to see what is the direct impact veterans. does this have a positive impact on veterans to relying, does it

speech what's the use now? how is it being used right now? >> there are portions of the land that are used as a medical center, stayed home, a nursing home. their portions of the property that, agreement on plays that are being used by parties outside of da for purposes to raise revenue that comes back to va at this point, kicking and partners, universities and so forth. specs about you, mr. werfel. with the presence proposal helped ensure that there are no so-called sacred cows that are exempt from the process? >> that's the exact go. the proper you're raising has a lot of particular sensitivities associated with it. we certainly would want that property be closely looked at by the board to determine whether some or all of it could be better utilized. not only to the benefit to taxpayer, but issues that are going on in the local community

with a property. i think that's a good example of a property that an independent process will help us to try to drive to the quicker decision and i would look forward to having va and administration work with the board to send information they need to reach the right decisions but it's also your intent, i don't want to say what you intent is. is it fair to say that by going through this process we can step back from our use of leasing properties and utilize or ownership to reduce the amount of money we're spending on these things? is that one of the object is? >> it absolutely is. there's a couple ways of skinning the cat which absolute has to be an objective. one of the them is by doing something off tough realignment. .edu equities have as a lot of our county offices across the nation and i think would be important to downsize in and a very tough to downsize without this type of independent process

that can drive through some of the competing stakeholder interest. that type of downsizing whether the 10%, 15%, 20%, he was a significant drop in the leasing footprint because of some of those facilities are least. elsewhere there are opportunities to downsize, realign and consolidate. mr. peck mentioned early in response to question from the chairman the dover building and said maybe we should bring in other properties around into the building and build it up. i think he would be referring to leases as well as owned. >> i also mention we are renovating the gsa headquarters building which houses about 2600 people with technology and other ways we use basic that we get about 6200 people in the building and avoid an annual lease cost of about $20 million, reduce about 5000 square feet of leased space in the washington area. >> thank you mr. werfel. how much savings you think that taxpayers can expect from the sale of these excess properties and where you think it will be

coming from? operational and maintenance savings? versus the portion that could be derived from sale proceeds. >> i think speed is approximately. >> our estimate is in the first three years that the board is operational and turning to the recommendations that the opportunities approximately $15 billion over three years. that $15 billion is made up of two different types of savings, as you mentioned. one is the proceeds from sale, and we believe there are numerous high-value assets throughout the inventory that we can't sell today in the current legal and competing stakeholder interest climate that we can sell under this process. the other is the elimination of operating costs. when you sell the building you a limit its operating costs and get proceeds when you terminate a lease, i think that leasing costs, so it's a mixture of those two opportunities. >> and one final question,

mr. chair? thank you. mr. sullivan, based on everything you have heard so far, the va uses enhanced user these agreements as way to maximize returns for the underutilized assets, and is the civilian brac process we're talking about implemented, how would the agreements affect the process in your ability to dispose of excess property? >> senator, i think they work in complement of each other. our leasing process works quite well when we can forge a win-win strategy between the local stakeholders, local committee, veterans and a government. and in cases as danny talked about where we have major challenges where we cannot reach that consensus, that decision, i think that process would be very helpful in helping us with those properties. i think both can work together. >> thank you, mr. chairman. >> thank you. going to go back to follow-up with the question that senator

brown asked i think of mr. werfel. when we look at the potential source of savings, one, we can save money, getting properties off the books, see if we can sell for a few dollars, so be it. secondly, we spend for some of these properties money for utilities. i don't know to call this operating costs, we can save money for some of these buildings, money we spend for security. however, senator coburn and i visited a large postal facility, i think was in chicago, about four, five, sixers ago. as i recall they had consider, had a considerable security costs as well. cost of maintenance, that had to be covered. are there others in terms of operating costs that are significant we need to be mindful of? >> there is one other thing we

mentioned in our testimony, that there is the liability of the government. deferred liability costs. you're either holding the building and appreciating in value and in essence it is deteriorating. or to keep it up. one of those -- so you both reduce operating costs and reduce reliability, they need to have you read have buildings and so forth. >> okay, savings on lease versus purchase. let's just talk about that a little bit. we talked about already. but i'm going to go back to the dover federal building. dover federal building has i think been made available as federal agencies have been moved out. has been made available to other potentially use of stakeholders in the community. as i believe i think one of our college or university said they would like use the facility for office in some of their

coursework. and i think that's what's going to happen. i think that's what's going to happen. meanwhile, federal agencies, congressional delegation have moved to basis that we are leasing. there's an argument that maybe we should've gone someplace else and build another building from scratch, and all moved into that. and there we could of saved money. but i don't know that was ever seriously considered. >> without knowing the facts in dover, it sounds like a situation we have all over the country, you can see pretty much without knowing the specifics that in most instances it makes sense for the federal government for long-term government uses, congress will be a for a long time, to put the offices in federally owned rather than leased buildings. i suspect what's happening,

what's happened in dover so it took a look at the building, decide it's functioning obsolete, the cost to bring it up is prohibitive, and then here's a key fact. that taking a look at how much capital investment we were likely to convince the administration, the congress to give us, it's not in the cards to build a believer in times and. that leaves us with the option of going to modern private sector space. we don't have the option in gsa is that the va has to some extent with enhanced use leasing which allows you to use private sector capital to build a facility which at least at some point is owned by the federal government. there are all kinds of legitimate scoring issues in both cbo and omb to keep that from happening. it's a concert and capital investment that is precious and a lot more leasing space and less as a percentage of owned space. and it's not good asset management. >> did you want to say anything, mr. sullivan? >> i think i do.

one of the critical factors when we look at real properties, one of the direct impacts is on veterans. va is a huge believer and use of leasing. and for the following reason. most of our places our medical leases and we need to get those services out into the committee where the veterans are. and the demographics of veterans change, as different conflicts happen, veterans demographics will change and services will have to meet therefore asked to make a lot of leases, government owned i think would not serve the veteran in long-term, not be able to provide benefits. i think there has to be about. we don't want to substitute leasing for building our own in the medical field. there's a great need to have flexibility to put leases in different places. have the ability and medical technology changes, demographic changes, having to shift them to different locations or different sizes. i just want to point that out.

>> mr. peck? >> that's right. as i said when you permanent needs, long-term needs, corporate real estate executives make the same kind of determination. the long-term needs, you want to be in space. social security office have often been example of this. you want leased space. on the other hand, with medical facility you have to face-to-face consultation. on the other hand, with social security and we've been talking to social security about this, to a large extent even the aging demographic now is computer illiterate and that's going to change where and how many social security field offices they need. that may allow us to reduce the leases and social security offices as well. >> mr. werfel, let me just ask, what other approaches aside from this brack like approach, what other approaches the ministration consider in helping us deal with the problem of surplus of underutilized

property can what other approaches did you consider and why did you settle on this brac like as opposed one of the other's? >> i think as a mention of it, as we pull back the onion layer on agency inventories, we started to see some transformation opportunities that existed, and they seemed to orient around areas that were going to be tough to address under the current and legal and regular framework. the three basic issues are the process is long and can be tiresome and bureaucratic, the financial up front money is not always in place, and then obviously the political competing stakeholder answers. one option that we have considered is more of a kind of a straight to legislation. so, we do the work and we show you our cards in terms of what we have. and you guys react to it.

and we say here are the 10 best recommendations that we have. what i have learned and what i believe is that if you sent me off with my colleagues to try to do that, knowing what i know about how the government works in the back and forth, we will take a bite out of apple and try to give you something but it will be a smaller bite that if you set off an independent board to do the same work. because i have in my position, and we all have, constraints about what we can reach for and how bold we can be. and so anyways that is an option, but i think we will come back with a small piece. and i also believe that if we did submit to you administration generated set of recommendations and put it on congresses played, it would, that small bite would get even smaller by the time they got through the process. so it's really, from our vantage point, how big and bold you want to be and aggressive. and in this budgetary climate

and the more we got excited about these transformation opportunities, i think social sturdy office is a good example. usga field offices and numerous high-value properties throughout the essays were the agency scratch their heads about how to even approach getting rid of it. we said let's go for the larger chunk, budget an and by what rit now demands that we maximize our approach. >> i think you were quoted, mr. werfel, maybe it was before a house committee, house committee, house transportation and infrastructure committee, because as you stated a civilian property real i'm bored could say the federal government $15 billion in the first three years of its operation, is that correct? >> yes. >> and how long do you think it would take a stand at the board and actually began its operation? >> i think, i mean -- >> what would be reasonable? >> i think it could be done

relatively quickly if we're focused on execution. one thing i learned during the recovery, if you give us a deadline, no matter how complex, we will figure it out and plow through. i would probably look at an 18 month or so lead time. once the bill is up and running for us to get the members together coming get their staff, one of the things that we're doing right now to maybe diminish the 18 month lead time is we have reformed as real property advisory committee. there was a memorandum on the same day we transmitted is to find property realignment act for congressional consideration on may 4, creating a real property advisory committee made up of cfos, and senior real property officers, and mr. peck and i both sit on the committee as well. one of the main objectives of the committee is to provide the board with a set of analytics and a set of information that allows them to hit the ground running. they don't have to take any of

it because they're independent but we didn't want them showing up to an empty office. we wanted them showing up to as many months and as many blood, sweat and tears that week we can put into the analytics. if you approach it this way, that way, a lot of slicing and dicing or i think that will help accelerate. >> mr. peck. >> that's probably right% of the poor. i think given all the things we're doing now though, that if we knew we are getting legislation or if the legislation were passed, essentially we would be able to prevent the board it almost its first organizational meeting with a first cut of the property. so if it's 18 months to get them going on that, i think shortly after they need to be able to start making the decisions that i think we would all like to make. we could start moving properties through the pipeline. >> okay. the last question i would probably ask will be to mr. wise and mr. lepore. i'm not going to ask if i'm going to telegraph my pitch. and the question i ask after asking another one, mr. werfel, is if you were in our shoes, our

independent watchdog agency would have great respect for you, and genuine affection, and here's my question. it's going to be, if you are in our shoes on this side, what would you do? is a pretty simple question. don't answer it yet. if you were sitting up here, if you were senator brown or senator coburn or senator begich or me, what would you do? what if you are part of this committee? and mr. werfel, my question, i understand that a month or so ago the administration released about 14,000 properties i think. you said have been reported access by the federal agencies. for the average person it sounds like a lot of properties. it sounds like a lot to me. and the sale of these proceeds to generate a substantial amount of revenue and cost that could be used to pay down the deficit. i think you mentioned as much as $15 billion over three years. my staff has had the data sort of drill down o on the data a little bit.

and found that of those 14,000 or so copies on the list there's about, oh, about 1800 that may be already have disposed of. and about, oh, roughly 5500 were in the disposition process. i'm at the disposition process takes a month, year, a decade or whatever. but in other words, about 50% or more of these assets appear to be somewhere in the disposition process. and i would just like to ask today, how many excess properties are in the federal inventory? any idea how many excess properties? >> a couple of thoughts on that. the 14,000 that we released is a snapshot in time. what we do is we collect the data on an annual basis, and that provides us an annual snapshot. what we try to do on the website where we released the information is updated. so i think what that data

represents is at the end of fiscal year 2009, our inventory at approximate 14,000 assets that were designated as excess. when we release the information a month or two ago, we try to update and said since that time 1800 have been disposed of. >> taking it out of the 14,000 that were listed, that were released in 2000? >> yes. our main emphasis around the release of those 14,000, one, it's transparency to make sure that the public is holding us to kabul to get to them, and the public might be able to identify think that on that list that they think should be. and really, i'd like to think about it has cling out the underbrush. we have to get a better handle on these excess assets and dispose of them more quickly and rapidly, and we're working hard to do it. but in terms of the $15 billion opportunity, it does not exist within those 14,000.

$15 billion opportunity exists in those tougher to reach places where we have been unable to push them into it access because we been stopped in our tracks by a variety of different barriers. and the cipra board is intended to increase the number of facets that are accessed so we can move the more quick -- would offer books. they will stay in their inventory in the they might not miss the need to be in in the door and leslie, put a game changing set of policies to advance them forward. that's really what we are here to ask for your help to do. >> thanks. all right. mr. wise, mr. lepore, to wisemen. >> well, i would do the best i can. in answer to your question, of course we are working with the committee to try to answer these questions. we are doing, in fact, two new engagements that we are working with you on on excess property

and leasing issues. we hope it will contribute to helping the congress make these kinds of decisions, but all that said, we have some expense ngo studying pretty thoroughly the brac process. and it seems have done a pretty good job especially as described by our earlier panel on being able to accomplish a lot of things that dod needs to accomplish. i will that bryant explained more detail in response to your question. >> mr. chairman, i think in one sense the brac process has been a reasonable process for making very difficult decisions, among competing interests, many stakeholders that have well understood and vested interest in these installations and we can understand how that comes about. as you for and as you well know, lisa such as dover, very important. these are in some cases almost major cities or medium-sized

cities, and any community. on the other hand, the brac process has great a system whereby one can review candidate recommendations, hopefully in a consistent way using a consistent set of criteria, and in a transparent way. you heard senator dixon when he was here earlier who chaired a 95 commission he indicated he thought transparency was important the brac process generally has been pretty transparent with the exception of classified information. i think the brac law may and -- offer you a model. there could are significant differences. the department of defense is a department under a single secretary, in this case you have multiple federal agencies and departments under various agency heads. so it's not a perfect model but i think there has been circumstances where you may be able to pull from the process. the other point i will make is i think you got a lot of good ideas are different for spam and the second have, and i think if

i so does give is pick and choose the best ideas. some perhaps competing but i think nonetheless bracht, all these other ideas combined, you may be defined process that will get this done. >> anyone have a closing thought? >> at the risk of making people eyes glaze over, and it's important point, of the 14,000 assets which are described as excess, each asset, each on a property as category separately as an asset, 14,000 assetscommander may become if we get rid of a military depot that maybe 300 assets. there are fewer discrete properties that can be sold on that list. and so taking a look at that lives by itself does not get you to the $15 billion. we need is a three to get some of the other properties. and, finally, an authority which you will not see in the legislation because we already

have it is the authority to make use of private sector real estate consultants and brokers to help us do this. we do this as a routine anyway. we had the authority and have used the authority to bundle properties as one of the panel is in the previous panel said. so i want you don't there are properties we can do aggressively right now but there's just a wall of which we're going through a muslim you together second the ability to go after agency to make sure we can vacuum up all of the excess properties in a more direct way. and to make decisions faster. >> any other closing thoughts? i will add one last observation. i served, i was the other subcommittees i served as the finance. and senator bachus, we have done it for a series of hearings the sheer we have other wise men and women who come and talk with us and share their ideas for deficit reduction. and a month or two ago one of

the witnesses we had was alan blinder who was vice chairman of the federal reserve for a number of years, not that long ago. and in his comments on deficit reduction, among the things he said in his testimony was the 800-pound gorilla in the room for deficit reduction is health care costs. and unless we got our arms about health care costs, not exactly his words, but pretty much, we are doomed. and he said everything else is not superfluous but it's smaller change. and he finished his testimony, the other is testified and we had an opportunity like we did here to ask question. when it came my turn to ask a question, i said dr. blinder, you mentioned unless we address how to get better health care results for less money, that we are still going to have a huge problem with the deficit. i said what advice would you have for us? and he said in his response, he

said i'm not an expert on health care, but let me just say as a layperson, let me offer you this advice. here's my advice. he said, find out what works, do more of that. that's all he said. find out what works, do more of that. and we need to find out what works and do more of that. and part of it could be our expense with brac, and to do more of that. part of it, to learn from the va, the work that you have done. i'm reminded of the fact of those two imperatives i talked about, to meet the need of the least of these and also in a fiscally responsible way, that's really your charge at the va. and you oftentimes are held up as an agency that does a pretty good job in this area. senator coburn and i and our other colleagues are not going away on this issue. this is what i want is to result

in this congress. and i am determined to do that. and i am grateful to my colleagues. i am grateful to our stats for the work they've done preparing for this. and i'm grateful to you for the work that is being done, has been done come is being done on this front. let's just work together. we're all in this together, all in this together and we have to deal with this, realize the savings that mr. werfel has spoken up. we need to stop spending that kind of money. all right, thank you very much. and with that this hearing is concluded again, my colleagues will have to weeks to submit questions and we would ask you to respond timely. thank you very much. we are adjourned. [inaudible conversations] [inaudible conversations]

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>> now federal election commission chairman cynthia bauerly on her agency's oversight of campaign finance laws and the affect of the supreme court ruling and citizens united versus federal election commission. in that case the court ruled that outside groups could have unlimited spending on political campaigns. she spoke to the group public citizen for an hour.

>> thank you all for joining us today. i am robert weissman, president of public citizen, i am pleased you have joined us for this latest engagement with our 40th anniversary speaker series. public citizen has been around now for 40 years after being founded in 1971, working for strengthening our democracy, protecting health and safety. and we've been dashed and we recognize all this diverse interest we have ultimately can't be realized unless we have a functioning democracy, and above all a well functioning election system. so we are very pleased today to oppose cynthia bauerly, the chair of the federal election commission. she will make some over the remarks for us and we will be open for questions from you all. cynthia bauerly is, as i said,

is the chair of the fec. she has served on the fec since 2008. prior to that, worked as a staff member in the senate for senator schumer and then on the judiciary committee, rules committee and prior to that, worked as a lawyer in private practice. the fec is an interesting government agency has authority making sure that our federal election system is working properly, but many critics including i think even on the commission recognized the fec itself is not functioning so properly right now. and i'm sure we will be hearing about that. and, of course, the fec has also received some unusual attention from an unexpected source in the last several weeks as comedian stephen colbert has decided to file nonfrivolous petitions with the fec on some strange apparatus struggling issues. i'm sure we'll have a chance to talk about that as well. so without let hand the floor over to you. >> thank you. i want to congratulate public

citizen on four years of hard work and good work on behalf of the public. and thank you for the invitation to be here and thank all of you for coming. on such an incredibly hot day. to hear about campaign finance law which i think for many thought was not that interesting of the topic, but lately has certainly become much more interesting, shall we say and is even garnered the attention as robert mentioned, late-night comedy host. we know that once it sinks in at that level than the public really knows about an issue. once you get on late-night comedy. i think we can agree that campaign finance law can be criticized for developing to slowly get i note even in the timeframe when i agreed to come and speak to you, and today, there's been a major decision out of the eastern district of virginia about the constitutionality of corporate contribution. i will speak more about that but the fast-paced area and the commission has to keep up with

that. i will preface my remarks by saying they are my own today. they should not be attributed to any of my colleagues. that won't surprise you to know there's some disagreements among some of my colleagues about what the law is and what the law should be. so i note my colleague, commissioner issue. you might ask him his opinion as well on any of these issues. we tend to agree more than often do not. but some of our other colleagues we disagree with frequently. my remarks were originally aimed at citizens united, and i asked our friends here at public citizen to broaden them a bit because while citizens united certainly was a landmark decision and not a lot of attention last year, there are a couple of other cases that have been significant in shaping the landscape and abroad for circle to where we are today. and i want to note in particular the fec's role in all of this, the fec doesn't write the laws

and we don't decide whether they are constitutional. we have an important but very limited role in this process. that is, to minister that campaign finance act, the public funding provisions of the presidential funding act, and to make sure that the laws is being enforced and to develop regulations when the statute provides them, room for the agency to do so. so while it is a substantial role, it is not that of an article iii courts to decide the constitutionality of it, and is not that of congress to pass the law in the first place. one of the main function of the fec is to enforce the disclosure provisions of the act. disclosures a very important part. the bedrock of everything that happens in the campaign finance area, and the commission does go through publishing all of the reports that the committees are fighting with us. we review every page of those reports to make sure that they are accurate and where we have questions, we send further,

request for further information and make sure the public record is as accurate as possible. there's been a lot of discussion about disclosure over the last year, particularly after citizens united. questions about whether we're getting enough, whether people are supposed to be reporting are actually reporting. in april the "los angeles times" did a report about some of the nation's leading companies, and while they seem to be porting some of their own spending, they are not reporting their contributions to other third parties who are engaging in this kind of activity on our behalf. and, of course, public citizens did a major report in the year-end anniversary of the decision about what kind of spending happened after citizens united and what kind of disclosure was or was not happen as a result of that. so common disclosure, whether through reporting or through the disclaimers that we see on advertising, provides the public with important information about who is funding that speech. and that is of interest of the

supreme court has repeatedly held is an important governmental interest as recently as citizens united i find interesting, we often talk about the partisans of the citizens united that struck down the ban that there was a vision of pulling the disclosure provision in the statute so that is broad support at the supreme court for the important interest there. with respect to the corporate prohibition on independent expenditures, independent spending, citizens united certainly was the turning point, but there have been clues in earlier cases about the court's view of some of these prohibitions. in wisconsin, right to life, massachusetts citizens for life, the court had previously chipped away at the statutory prohibition. and, of course, citizens united struck it down entirely. so while it was surprising, perhaps particularly procedurally in that case, the court had already limited,

narrowed that statutory prohibition. another case that came out shortly after citizens united called speech now found a contradiction limits are unconstitutional or individuals who wanted to fund an independent expenditure only organization. speech now want to make independent expenditures. they were going to courtney or provide contributions to any candidate, and the courts found that since individuals could spend unlimited amounts of their own money in an independent way by analogy, if you want to provide contributions to an organization who was going to make those expenditures independently, that that would also be, the constitutional requires that to be unlimited as well. so both citizens united and speech now upheld the disclosure and reporting an artificial requirement that we find in the act, the essential part of what makes an entity required to report with is whether someone is a political committee or not,

but did for independent speech makes him departures from the underlying statute. and whenever major court decisions come down, the fec has an obligation to respond to them. we fairly any really noted we would not be enforcing the provisions the court had found unconstitutional. ..

, if someone were working on the contribution side that might raise coordination issues, so the commission flagged that issue for the requester in that matter. we had another advisory opinion

request from another organization called common sense ten. it wanted to combine the holdings of, basically, speech now and citizens united. speech now said antic dependent expenditure-only organization could accept traditions from -- contributions from individuals. independent spending from corporations was permissible, so the commission agreed in that request that they could accept unlimited contributions from corporations and labor unions, the two entities that were affected by the citizens united decision. and then, finally, we had a request from national defense pac. they wanted to do something similar to club for growth but in a different organizational way. within their organization which has, for a long time, made contributions and worked with candidates to endorse issues that it deems important, wanted to set up within it an independent expenditure account.

so not a separate organization, but simply a separate account. the commission could not give an answer to that requester, it was one of those that the commission deadlocked on, and we split 3-3. the rationale for both sets of commissioners on that is available on our web site in that advisory opinion file. but, basically, because the organization made a contribution, a number of us including commissioner wall they are and myself -- walter and myself were concerned that cal med precluded that reaction. and that may be coming. ndpac sued us in january, and as you are all aware, the fe -- sec is sued frequently both for being too regulatory as in the case of ndpac and to lenience,

representative christopher van hollen has recently sued us over our communications reporting regulation. so that is in court as well. as you look around the country, you'll see that there are a number of cases whether challenging the federal statutes or very similar state statutes that are in the works. so i think it's safe to say that there'll be more developments in this area to come. all of this was a major shift in the landscape of what we had previously understood about campaign finance law that corporations were generally prohibited from their general, spending their general funds in any way on elections. um, and so that, i think, raises issues of disclosure and coordination and even political committee status to a new level. all those issues were important before, but now with all of these new speakers, i think they have an even greater significance. that isn't to say that the

status of corporate contributions such as what happened this week aren't important, but there are issues that the commission can decide that are within the commission's jurisdiction, and that's not one of them. there are lots of issues like coordination and political committee status and reporting that are within the agency's jurisdiction, and that's where we can focus our efforts. and from my personal perspective, i think we can be doing more on disclose closure, and i think we should be. i think we should consider whether our disclosure rules need updating. for example, there's a cross-reference to one of the provisions that the court struck down in our reporting regs, so we have to think about how to do some of that clean up. and i think that it would not be too much, either, to ask whether we should reconsider some of the disclosure requirements given citizens united. as you, if you follow the commission, you know in january

we were unable to issue a notice of proposed rulemaking on citizens united. there weren't four votes to ask the public about whether we should even ask these questions and gather public comment on our reporting rules and on rules with respect to foreign nationals. another group that is implicated by the citizens united decision because, obviously, now if corporations can spend independently, there are issues about whether a domestic subsidiary of a foreign-based corporation, do they have the same rights as a domestic corporation? there are issues about that that the commission, some of us on the commission would like to seek public comment on. and we're going to try to do -- next week we're going to take another shot at it, we're going to try to ask the public some of these important questions. i'll also note that we do have some petitions pending on some of these issues before the commission, and there's a procedure in general administrative law, but

specifically at the commission that if we receive a petition, our general course is to put it out for public comment. so if we're able to put those petitions out, we are eager to seek public comment on those petitions. and, of course, anyone can file a petition if they think there's an issue the commission should be addressing. there are lots of ways to put issues before the commission, an advisory request in petitions and, also, any of our documents that are handled at our open meetings are made available to the public. and the public can comment on any of those. there's a formal process for commenting on advisory opinions, so whether you're the requester or not doesn't matter, we are interested in hearing comments from everyone. and i assure you they will be read. we read everything that comes into the door. and, again, anything that goes on in our open meetings is available to the public ahead of time, and so if there's an area of interest and a need for comment, we're happy to hear that as well.

as of yet we have not been able to seek comment on these important issues. it is part of our job to try to provide as much guidance as possible for those who are trying to comply with the law, those political committees that are filed with us and need to file their reports with us, those who are making independent expenditures or election nearing communications and need to file reports with us, we have an obligation to provide them with as much assistance as possible because if we can get those reports filed correctly the first time, the public has the information it needs in a timely way to understand what's going on. and just for a moment on the amount of disclosure. i know there's a lot of discussion about the need for additional disclosure, and the role, at the fec we are limit today the statutes. so if someone is a political committee, if their major purpose is defeat of a

candidate, then they meet our definition. if they don't meet our definition, they're outside of our jurisdiction. now, they may be in the jurks -- jurisdiction of someone else. the sec has recently provided an opportunity for shareholders to have some comments on corporations. i know there are efforts in congress and public citizens have supported them to try to expand them. but as of yet at the fec this is, this is what we have to work with, and that's what we're trying to work with. i think disclosure is incredibly important. it's becoming more important as there are mr. speakers, and there have been efforts to argue anonymous speech is required by the first amendment. courts have repeatedly held that the interest of disclosure is

important and is necessary, in fact, to our democracy. in citizens united, as i mentioned, you know, we spend a lot of time thinking and focusing on the part of that decision that struck down the ban, but it also has some important things to say about disclosure, i think. citizens united says the first amendment protects speech and permits shareholders and citizens to react to the speech of corporations and entities in a proper way. this enables the electorate to make informed decisions. and not long after citizens united in another matter, another case in front of the supreme court called doe v. reed in california, um, i note that justice scalia issued a concurrence because he didn't think that the disclosure petition should be treated in the way the majority did, but his concurrence, i think, was notable. there are laws against threats

and intimidation and harsh criticism. short of unlawful action is a price our people have traditionally been willing to pay for self-governance. requiring people to stand up in public for their political acts fosters civic courage without which democracy is doomed. and i find it notable, you probably won't find me quoting justice scalia all that often, but i think he's right. i think civic courage is something of a tradition in this country, and, you know, whether it was, you know, the soap box on the street corner, you knew who was speaking. and transparency and disclosure have been an integral part of our self-governance and civic courage. i really think that phrase is important. i expect that we will hear continued concern about disclosure and the ramifications for it. as pressure for disclosure mounts. including shareholders' right to have a say on spending, um, and that sort of thing. i think that one thing that's

notable is consumers, like voters, have had access to information for a long time. and voters, like consumers, can engage in behavior in response of that information. i grew up in a household where i couldn't have nestle quik, and mothers across the country thought that was inappropriate. they took action with their pocketbook, and that has been, i think, a tried and true form of consumer response to corporate behavior. i think the montgomery busboy cots were probably bad for business. that's exactly the point of the boycott. and i think, you know, consumers have that right to engage in behavior in response to information it learns about a corporation. and i think voters have that right too, to be able to respond to -- as i think the supreme court put it -- make informed decisions and give proper weight

to speakers and messages. and the commission does have some role to play in this, as i said, and the commission is not doing as much as i might like or some of my colleagues might like, but it does promote transparency and accountability. it provides the public with a clear and accurate public record in the form of the reports that the committees file with us. the commission and its dedicated staff will be making sure that that data is available quickly and clearly on our record, and is we also provide that data to organizations who are just in the bulk data, organizations that sort that information and try to gather some broader lessons from if what's happening in the spending. we also will continue to provide as many answers as we can to clarify what the law is happening. we have some very interesting requests pending including mr. colbert's, and, unfortunately, i'm not going to be able to talk about those today because they are pending, but you can look forward to

commission action on those throughout the summer. and it is a very important role for the fec, to provide as much guidance as we can to specific questions. so i have heard recently of the calls for, from some in the reform community that you should just shutter the agency and use our money to start paying down the deficitment you know, this -- deficit. you know, this might sound self-serving, but i disagree with that. i think the agency provides a very important public service. while it's true we deadlock on more things and on the hard things, if fec were to just disappear, our data would dis appear, our reports, and the public would have no information. so i think it's safe to say that i would disagree with those. and those who are concerned about the state of campaign finance law and disclosure, i have to believe it wouldn't be a desired result for them as well. so with that i'll be happy to take any questions. i'll be even happier if i can

answer them for you, and i'll let you go. >> thank you very much. [applause] let me start with a few, if i may. the problem, the issue of discuss closure, as you know, citizens united opened the floodgates for a lot of corporate money to come in. a lot of that money's coming through channels that are not disclosing it,501c4s and trade associations, and that nondisclose your is a result not of the supreme court, but of an fec holding in the past. what steps can be take on the, by the commission, to get the disclosure in this big area, growing area of secret funding? >> i think to be able to respond to that, i think i need you to -- i'm not sure what you mean by an fec holding in the past. if you're talking about, um, freedom's watch or the

regulation, um -- >> regulation that the finishing ec has -- [inaudible] >> okay. >> you know, it took a long time for congress to finally amend the federal election campaign act to give full disclosure, but they succeeded with the mccain-feingold law. so we, essentially, had near 100% disclosure of all the money going into outside groups that was being spent on independent expenditures. but the fec narrowed that in 2007 to apply only to donations that were earmarked for a specific political expenditure which no one does. you know? and as a result we've seen disclosure fall from 100% down to 50% in 2010, and it'll drop much lower as we go into 2012. this is the fec regulation. are you going to revisit that? >> well, we, we have been trying

to revisit that, and as you're aware congressman van hollen has filed a lawsuit over one of the electioneering communication piece of that regulation. you're right, the statute and the regulation have different scopes. um, and we, and we have made an attempt to try to seek public comment on whether the commission should revisit that regulation. thus far we have not been able to put that notice of proposed rulemaking out the door. >> well, this raises the issue you're referring to about the deadlocks on the commission. i know it's awkward to talk about it, but what's the way out of this? obviously, the calls to shut down the agency are because people are just frustrated things aren't happening. >> right. well, i think it's partly a challenge of structure. the agency requires four votes to accomplish, to take any action. frankly, the agency is what i would describe in sort of a non,

you know, not from an administrative law perspective, but fairly a reactive agency. so complaints are filed with us. we do have the ability to go back and visit our regulations, but the reality is it's not going to happen frequently. but when we get petitions in the front of us to open a rulemaking, we have to consider those. we have to consider the petition. we have to considered a vise ri opinion requests -- advisory opinion requests. we consider comments that come in on those advisory opinions or other policy that is the agency is adopting. so i think it is, it is a challenge of structure, but i also think that there are mechanisms to force us to take what action we can, and those do exist for the public organizations to take. and i think, you know, again, it is a group of six individuals. i think all of us are trying to do, serve the agency in a way that we might see fit.

some of us disagree about what the role of the agency is. >> any questions from the room? can you identify yourself, please? >> [inaudible] i was wondering, on citizens united, if you might have an opinion on whether reformers might have gone too far with the $5,000 limit on contributions to pacs for human beings, and if it hadn't have been for that, if there would have been no sympathy from the court for their inability to make their movie and promote it without violating those statutes? >> well, i think, i think what's true about this area of the law is it's always -- as you note, it takes a long time to get any of these laws through congress, and i think it's hard to describe any of them as anything but a compromise to actually get it through, through congress. and, again, there has been more

unanimous, more support in congress for things like disclosure in the past, and that showed up. so t hard for me to say that, you know, 5,000 or 10,000, it's not -- that wasn't really the issue in citizens united. it was really about whether this corporation could run its ads about its product, and that's, you know, the court took it a step further and struck down the ban itself. but i, i think it's hard to -- it's pretty easy in hindsight to go back and say, well, we should have written the law differently, or the fec should have done something different, you know? we are where we are. the court did something that, i think, probably surprised almost everyone involved in the case, so our job is to implement that decision. >> [inaudible] you talked about the myriad of challenges the fec is facing with its current jurisdiction.

republicans in the u.s. house of representatives have talked about eliminating the elections assistance commission, heading that over to the fec's jurisdiction. in your opinion n your personal opinion did the fec have the capacity to do that, would it be a good thing, and how would you be able to jug it with your current jurisdiction? because as you noted, it's challenging enough as it is. >> uh-huh. well, i will tell you exactly what i told the members of congress in a letter we wrote to them on this issue, that it's congress' determination and prerogative to decide where certain responsibilities land. some of these responsibilities actually did exist at the fec in terms of the clearinghouse of information. obviously, the creator of the eac established additional requirements, it created the entire pool of money that would go to states to modernize voting equipment so, obviously, that didn't exist before hava. if we do get additional responsibilities, we would need the appropriate level of funding

to continue those because, obviously, the eac has its own budget and its own contracts and its own personnel to do a lot of this work. so if we were to observe those, we would need an appropriate level of resources to do that as well. but that's congress' call as to whether that's an appropriate way to address the issues that were, um, that were behind setting up the agency in the first place, the concerns that were addressed at hava. >> my name's jan chastain. i have two questions. the first one, i don't know if you'll answer it, but are there any members of of the fec who are actually against the fec that you feel working with them they're actually there just because they're against the fec and that's why they were appointed, number one. the second one is in the light of the, in the light of the situation we find ourself with

the strategic computer voting scams across the nation and on the rise, i sometimes feel that the election, that citizens united and all these things in talking about disclosure and election spending, it's almost as if they've distracted us with all of that, and it's quite complex. and they've just stolen the eggs out of the hen house. and i lived in a county that in 2004 we were 18 points off the exit polls on the presidential election, and it threw my state. and that was nevada, wash shaw county. and would you ever recommend that we follow what germany has done which the german high court, which is one of the better courts, the least money-oriented court in the european union certainly, but they have outlawed computer voting.

because they say it violates the german constitution, has the effect of counting the votes in private, and your votes are counted by somebody you don't know. um, so those were my to with questions. >> okay. and this is going to be one of those areas where i'm going to disappoint you, and i'm going to be unhappy because i can't answer either of your questions, i'm afraid. i can't speak to the views of my colleagues on the role of the agency or why they were appointed because, obviously, i didn't have -- i didn't -- i was one of those who was appointed, i wasn't the one appointing. and with respect to election administration issues like computers, um, our role is campaign finance. so the spending of money in our system, and this is, i meet with, i have an opportunity in this job which is fascinating to me with representatives of elections commissions around the world. and in many countries they have a unified body where they handle at a federal level both the campaign finance side and the election administration side. that doesn't happen in this

country. we have standards, of course, that eac and federal law, but the administration about choosing, you know, which particular machines to use so long as they meet certain standards are handled by states. they have an election administration official, and those decisions are made at the state level. we are fairly unique in the world in that sense, but that has been the determination that the federal law exists to create some standards, insure access, disability access, the voting rights act, obviously, to insure access for all. but we don't -- at the commission we certainly don't deal with those and, frankly, at a federal level we don't actually deal a lot with particular technologies other than to set some standards. >> go ahead. >> dixon with reuters. you said next week you'll be taking a look at trying to ask the public some of these questions relating to disclosure after citizens united. first, what are the odds that

you'll get a different outcome than you got last time and, two, could you be more specific about what questions about disclosure you'd like to be asked for the public? is. >> sure. um, our agenda for next week is up on our web site if you want to see the specifics on that. um, and there should be a document, a full document with that shortly. it'll be a fairly long document. similar to what we had hoped to do in january, to ask some questions about the reg that was adopted in 2007 for electioneering communications, a few questions about independent expenditures and some questions about whether we should reconsider some aspects of foreign nationals in if light of the decision. it's a much narrower set of questions than we had proposed in january, but we think there's a critical mass of questions that should get asked. it's certainly not everything that i think some of us might like, but it is an attempt to

try to get some consensus from some of our colleagues. um, i'm not sure about the success rate. we're going to, we're going to try again because it's an important issue, and if, and as you'll notice also on that agenda, our petitions that have been filed by both the james madison center and representative van hollen, was was -- because if we can't put one out, we need to address those individually. so that's where we are. >> [inaudible] there's an increasing number of 3-3 votes on the commission. i think more lately, last few years than you've had in the previous ten years or whatever. why do you think there's such an increasing number of splits? >> i think, again, it's very difficult for me to speak for my colleagues. and in many of these 3-3 splits, as you know, we write statements of reason to explain our

reasoning. so i wouldn't presume to speak for my colleagues on any particular case with respect to that. i think there are a couple of things that they have said publicly and we have said publicly in terms of what's going on, and some of it is about how broadly we read cases. some of it, as was mentioned, this area, you know, if you go, you know, once mccain-feingold was passed and it was largely upheld to mcconnell, i think some of us at least thought there might be some calming of the waters. but, obviously, the courts have taken a very, have been very interested in this area of the law and have taken, made some big changes to the law. so there has been some changes. but, again, i point you back to the statements of reasons in those cases because i don't think it would be fair for me to even try to speak for my colleagues on that. i can only explain to you why i make -- the decisions that i snake the basis for them -- that i make and the basis for them. >> mike reilly with talking

points memo. the ensign case is a matter we're hoping you can speak about. in that case the fec went against recommendations of the general counsel to look further into this $96,000 payment and whether or not it was technically a gift from his parents or whether it was a severance package. is that something that you think, you know, the fec essentially took him at his word in that matter? obviously, it would have been difficult to get at some of these documents, but do you think that's something in retrospect that makes people lose faith in the fec? >> i can't speak to what people think of the fec or why, but i can tell you about the enforcement process because we have a specific process that we follow that comes into the agency. for example, a complaint is filed that complaint is provided to the individual's name in the complaint who are identified as respondents in our procedure. we get a response from those respondents, and we have to make a determination on those two

sets of documents. and that's all we have. before we can do an investigation, we have to make an initial determination based on what we're presented. and so we have to rely on that. and, again, i'll cite you back to the commission's reasoning for what we relied on in that particular matter to reach the determination that we did. we had before us, you know, in any enforcement case we have limited information, and until we find reason to believe we cannot go and do -- we don't have the power to go and do an investigation prior to making these decisions, so we have to rely on what's in front of us. and as we said in that statement, we relied on what we'd been told. >> [inaudible] i just wondered if the fec if it's in if your jurisdiction you have the power to regulate or

oversight other than campaign reform, campaign finance reform. because election is not just whether a candidate or committee can file a report, but also any other sector which will obstruct our democracy or fair election -- [inaudible] candidate exposure or literature campaign or televised anything, it can be all obstructed. i was wondering if fec can be more proactive to this area to be sure that none of the corporate media can broadcast it or advertise the campaign, but also the -- [inaudible] equality and have equal chance of exposure rather than they're limited to certain candidates or corporate-preferred candidates. or republican candidates.

in every direction that really affects our democracy, including -- [inaudible] local election office or state election office. -- [inaudible] to be problem or campaign reform, campaign report. so that hurts some candidates. so i just wonder if at the federal level do you have a better approach to promote this kind of fairness and equality? [inaudible] the public -- [inaudible] i wonder if you could oversight or some kind of campaign? >> the jurisdiction of the fec is limited to those areas specified in the federal election campaign act, and those

don't directly deal with things like access to the media. the fec does have some jurisdiction over that. the only one provision that we, that is required is that, basically, television candidates -- television stations can't gouge candidates, they can't charge them more than they would charge other folks for the same amount of time. but our system in the united states is many-layered. it's everything from the local election administration offices to federal law that allows for presidential funding. so it's, it doesn't happen at a centralized place in our country. the federal election campaign act deals with the campaign funding side and the disclose you of that funding and -- disclosure of that funding and the ads, for example, that campaigns may put up on the air or in print. they're required to have disclaimers about who paid for them and that sort of thing. so we don't really have the capacity to address all of the

issues that you've raised, but we do address some of them in terms of making sure all candidate committees, all political committees, anyone who is participating in this process follows the same set of rules. and it doesn't matter whether you are, your running on the -- you're running on the ballot as a member of a major party, minor party or independent, all of the same rules apply. it doesn't matter whether you're, what level of party that you're participating in. and some of the things that i think you were addressing about valid access and that sort of thing are really set at the state level. that's how it works in our system. >> hi. i'm seth, i'm an intern and i go to uva. i have two quick questions. one, would having an odd number of people on the commission help, five, seven, or nine something like that so you could make decisions? also, do you foresee the limits

of 5,000 per individuals and now corporations to go away before 2012? and are any of these things good or bad for our political system in your personal opinion? >> first, to the structure. i think that you can certainly look around at other independent agencies who do have an odd number, usually five. and they do have an appointed chair which allows that person to set the agenda and move more quickly. we have a rotating chair. i serve as chair this year, it will rotate to caroline hunter next year, so it's a rotating chair which also effects the ability of the person to have a lot of impact on the agenda or the outcomes of the agent i is. agency. um, perhaps a different number would make some difference, but i think, um, i'm a -- there have been a lot of discussions in congress about how to create a better agency. there have been specific proposals about how to create a different agency that has been

argued to be better. um, i guess i live in the practical. this is the agency that we have, this is the agent is i i'm appointed to. my job is to do the best that i can while i'm here in this position and try to make it work as best that i can. and, you know, it's up to someone else to decide whether i'm succeeding or failing at that. but i tell you, i come to work every day trying to make it work as best as i can and trying to make sure that the agency is running from top to bottom. yes, we have had a lot of 3-3 splits, but -- ask those happen in the hard enforcement cases, and they are important. but there's a lot of work that happens at the agency that has little to do with who's sitting in the commissioners' offices. all of that disclosure, our web site which is a great resource for people, we have, you know, we have an 800 line where you can actually call and talk to a live person about what campaign finance law requires. part of our job is to make sure the public record is accurate, and that means we need to make sure people are filing accurate

reports. and i'll just note that when i tried to call the irs to file my taxes a couple months ago, they didn't actually have a person who would help me with that. while i hear the argument that we aren't doing enough and we are, we deadlock on the hard stuff, i do think we do a lot of public good in terms of providing a public record for voters, for those who are contributing to campaigns to know what's going on. and if people see problems with that, then they can, they can either take action in in their n way like in voting, or if they see something that's a concern, they can file a complaint. so, we do provide deny that aspect of disclosure, i think, is really fundamental to the law. >> hoping you might be able to talk a little bit about how the internet has changed sort of the interpretations of a lot of these rules. you know, you're reading previous rules that were in prior to lot of the more

technological rules that campaigns are using today and the difficulty of how they apply online. >> the statute, of course, the statute was -- the original statute was written 30 years ago. um, we did engage in an internet rulemaking a couple years ago which basically said the commission was not going to be applying its regulations to the internet. the internet is, obviously, a cheap and easy way for people to engage in a lot of communication. the one exception is for ads places by political committees on our web site. if you're paying for an ad, you do have to follow the disclosure/disclaimer requirements that exist in the regulations. so it is a challenge, and i think the challenge is knowing exactly how to respond to it because we could update our rules, for example, to figure out what to do with twitter. and i'm guessing in five years people will think of twitter as we now think of napster, as something old and something, you know, from a long time ago.

so i think it's, i think it's always dangerous to try to keep up with technology because technology is always changing, and i think those innovations are very good for campaigns. it's a way for the public to be very involved in a grassroots way. you don't have to have a lot of money to be able to, you know, push out information of your own on your twitter feed or your blog or anything like that. we largely, the commission took the approach in that rulemaking that would sort of stay off of, stay out of the internet's way other than, like i said, for ads placed for a fee on someone's site by a campaign. and, of course, campaigns when their own web site are required to have disclaimers, any of the requirements that fall onto campaigns and what they do on the internet they have to, you know, continue to comply with those. so if they're raising funds on the internet, for example, they have to follow all of the other requirements that go along with solis fitting -- soliciting funds under the act.

>> you have the petition filed -- jim bach, the lawyer at citizens united filed, announced plans to have a new superpac in which case they would have candidates raise unlimited sums of money for the superpac and they would then use that money on those campaigns. [inaudible] you did get one from be a couple of democratic superpacs. i know you can't talk about the petitions, but is this something you plan to tackle soon, or is there a timetable for trying to tackle that issue? >> right. well, you know us well enough to know that i can't comment on one that's pending before us, but the statute requires that we respond to advisory opinions within 60 days, so that's the time frame. again, i think you'll see a lot of activity in advisory opinion over the next two months to try to address all of those within the statutory time frame. we can tibet an extension -- get an extension from folks, but we

really do try to answer them within the 60 days. >> [inaudible] and my question is asking you to revisit something you brought up at the beginning of your remarks which is what i think we could all agree is a surprising decision in the eastern district of virginia both last week and early this week. any observations you might have as that would play out as you move forward with the citizens united rulemaking questions and also through the 2012 cycle. >> that matter is being handled by another federal agency, so i'm really not going to talk about the case in particular. i would just note that as i think the opinion did that last month in the eighther is cut found sort of -- eighth circuit found an opposite way, and there's a decision last year out of the second circuit that also concluded in a different way. again, because another -- the department of justice will handle that, and i'm not going to get in their way of that.

i think given there had been two other circuit court decisions on that, i would note that that seems to be, it seems to be not in keeping with those decisions. >> it seems every attempt at public campaign financing involves giving money directly to candidates. do you think it would be administratively doable for congressional elections to make it so that voters have an allowance or de facto voucher that they can give $20 of public money to their favorite congressional candidate. would that be something the fec might need to expand a little bit but could oversee, and is that administratively doable? >> i'm not familiar with the program exactly like the one you just described, but if you look around to the different states, there's a number of different models for how voters can provide some ability to specific candidates. in minnesota, for example,

there's, basically, up to $50 i believe you can get your money back in sort of a tax refund. so that, in effect, looks a lot like what we think of like public financing in if internships of turning money -- in terms of turning money over to candidates. there have been a number of bills introduced in congress about how to bring a public financing system to the congressional level not just at the presidential level. and, obviously, there have been a lot of discussions and legislation proposed on how to refine the presidential system as well. and so, again, you know, if those bills were to pass congress, we would implement them in the appropriate way. >> are you comfortable at all stepping back from the particular cases before you, request for administrative opinion and so on, and just looking at the landscape which, as you know, to many of us seems

horribly flawed right now. not just with a completely inadequate disclosure system, but a system itself we view as corrupt. offer a perspective on that and that doesn't involve anything before the commission now. recognizing the dynamics on the commission right now, it seems like an opportunity to be more forthright, and, you know, help to drive the process forward to get us out of where we are. even if we're able to move incrementally, it's not really addressing the underlying deep flaws in the system. >> right. well, i think the challenge is that we administer a statute, and the statute does have, again, the statute and the reg don't exactly meet up. that statute is -- our reg, i'm sorry, is before a court right now. so i'm not going to spend a lot of time, you know, talking about that because the agency is defending its dually adopted -- duly adopted reg in court. from my perspective what's important to note is that in all

of our discussion of what free speech requires, you know, obviously, a fundamental right critically important, but that has always been balanced against other governmental interests. and in terms of prohibitions, that's been corruption or the appearance thereof. with disclosure the court has repeatedly said that because it is not a ban, it does not need the same level of interest. and it has identified as a very important governmental interest the ability of voters to know who's speaking. and so i think that while there is, obviously, concern about some of the decisions, i understand the concern that has been raised about some of the decisions. i think it's important to also focus on what the court is telling us about disclosure and how important it is and how valid it is. it's constitutionally valid, it has been repeatedly held so, and that's the area to focus.

and, again, in terms of what we can, we can do the statute covers, you know, political committees. that may not cover the entire landscape of those who are speaking in some way that a voter might consider to be participating in an election. we have these sort of colloquial, not technically-defined term like issue as. and i think we all have an idea of what we mean when we think about that. but, again, the commission's jurisdiction extends to political committees or those who are engaging in electioneering communications or independent expenditures. and those are defined terms that have been defined by the act and a little bit narrowed by the courts. so i appreciate the frustration, i really do, with the idea that we're not getting as much disclosure as we think we should get. but some of that is out of our hands, frankly. some of it's not. i hear that criticism, and

that's why we're trying to do more in the area of disclosure. but some of it is based on the very technical definitions that have come from the statute and from court decisions. >> let me take one more try. so understood. stepping back from the jurisdiction of the agency, you know, as the head of an agency that has an important view on the electoral landscape and the campaign spending landscape, forgetting -- leaving aside the issues before you, forgetting about your own limited jurisdiction and going beyond disclosure do you see, are you able to say anything about how the system looks and what kind of reform -- sort of more deeper reforms you'd be interested in seeing apart from disclosure. >> in terms of things like public financing, i mean, i think -- >> public financing, the right of corporations to spend money or the idea that unlimited spending equals --

[laughter] >> you want me a dissertation on buckley? is. >> you don't have to give a dissertation, just a comment. >> well, i think, you know, i think i've expressed my personal views about the importance of disclosure and, frankly, of the, you know, i don't agree with the approach of some that anonymous speech is the only way that the first amendment can be satisfied. so, but i think, you know, you'll have to, you'll have to forgive me, but my role is as an administrator at this agency. and we have a specific role. and whether i agree or disagree with buckley or citizens united is, frankly, irrelevant to the job that i have to do on a daily basis. and if there's a day in the near future where i'm no longer serving on the commission, i'll be happy to tell you all of my deepest, darkest thoughts on our entire election system because i have lots of them. [laughter] i've been in this area for quite some time both on the campaign

side and on the hill. but, frankly, in this current role it's irrelevant. my job is to follow the supreme court decisions, um, and i think, frankly, other people's jobs is to explain why they think they're wrong or right and to ask us for action, to take action on that, provide us with comment and input where you can. but i, i have to stick to my role, and i hope you'll even begrudgingly, perhaps, respect that. [laughter] >> i will. [laughter] >> thank you. [laughter] >> thank you very much. [applause] >> thank you all very much.

[inaudible conversations] >> a full slate of live events for you today on the c-span networks. at noon eastern on c-span, the committee for economic development hears from the outgoing chairman of the council of economic advisers, austan goolsbee. also at noon a panel discussion on the future of medicare and social security. speakers include two medicare and social security trustees. that's from george mason university's her cay da center at noon eastern on c-span c-span3. and here on c-span2 we'll have several panel discussions from american-arab antidiscrimination meeting today. the topics will include an interfaith look at diversity, civil rights and the recent popular uprisings in the area ab world -- arab world at 1 p.m. eastern. >> connect with c-span online with the latest schedule updates and video on twitter.

continuing conversations on facebook. political places in washington and beyond with four square and programming high highlights on our youtube channel. c-span and social media, connect today. >> a federal communications commission report found that while the numbers of media outlets has grown considerably in the digital era, there is an increasing shortage of in-depth local journalism needed to hold government agencies, schools and businesses accountable. the findings of the 18-month-long study looking at the impact of technology on local media were present today the fcc commission members at a public meeting thursday in washington. the session begins with a discussion on plans for a first-ever nationwide test of the emergency alert system. julius genachowski chairs the two-and-a-half hour meeting. >> chairman, commissioners, second on your agenda, rear admiral jamie barnett and damon penn, assistant administrator of fema will give a presentation

regarding the emergency alerta system.t >> thank you, admiral, i'm goin to give you the floor in a minute, but i do want to welcome our partners from the, from fema, damon penn, assistant administrator, thank you for coming this morning to help witm this presentation. and, also i've lost your name, mark paese. >> paese. >> i -- paese. >> i practiced with him before we started.ed >> from the national weather service. thank you both for coming. admiral, thank you for your ongoing work, and the floor is yours.or >> thank you, commissioners. i'm proud to be before you with damon penn, my friend anddera colleague for the national continuity programs to brief you on this program and mark paese,

director of operations for the national weather service. he's been another key partner ii the emergency alerting system. on november 9 of this year at 2t p.m. eastern standard time the commission, fema and noaa will conduct the first-ever top to bottom nationwide test of the emergency alert system, eas. while eas has been around for many years, this is the first nationwide test. the nationwide test is essential to insure eas functions duringns emergency.av as we have repeatedly learned throughte disasters, the tornads and floods that have devastated various parts of our country, au reliable and effective emergency alert system is key during a disaster. so first let me provide some we could on eas.e it's an alerting system whichs.

relies on media-basedmedi communication. communications. it will transmit emergency alerts and warnings of american public at the national, state and local levels. pas has been in existence since 1994 though its antecedents have been around since the 50s. broadcasters, satellite, radio, satellite television providers as well as cable television and violent video providers all participate in the system. the eas participants provide tremendous public service by transmitting thousands of alerts and warnings to the public each year regarding whether threats, child abductions and many other types of emergencies. this flag you see displayed shows that the present-day eas reaches the public. esa hierarchal message distribution session. a miller may be buy out the by a press official at the national, state or local level and initiating a specially encoded message to a broadcast station

-based network then in turn delivers the message to individual eas participants. the public safety officials need to send an alert warning to alert region or even the entire country, we need to know that the system will work as intended. only a top-down simultaneous test of all components of eas can provide an appropriate diagnosis of a systemwide performance. we get along with our federal partners want to conduct the first national test as soon as possible. we thought was pretty to conduct a test when hurricane season was nearing its end and before the severe winter weather season begins in earnest. after consultation with eas participants, which is overnight to avoid the holiday rush and we chose 2:00 p.m. eastern standard time to minimize any disruption during rush hours. after the first task in a periodical national test will likely be retained in may, different time just like the weekly and monthly testing out. the beauty of the eas designed to work another disseminating

emergency alerts or unavailable. other is no guarantee other communication methods will withstand after major disasters, various elements of the eas are designed to withstand such calamities. the bureau will soon release a public notice officially announcing the date and time of the first nationwide eas test. in addition, the beer has begun meetings with fema and u.s. participant stakeholders to begin dialogue to resolve operational issues in advance pass. the working to develop a dedicated website and provide information about the test of the public. i like to thank several people at the sec, sina and noaa for their hard work on these issues. i like to dodge her deputy. she, with the folks, for cybersecuritization. also greatcoat, bonnie k., thom beers and david pan, wait

witmer, anton jonsson, and buckingham, mark paisley and also eric pinky for all their work on this emerging issues. now it like to turn it over to damon penn. >> mr. chairman, commissioners, thank you for the opportunity to be here today. it's a great day to announce the national test of the partnership that has been affirmed in a couple with mark and his efforts really produced a vital service to the american people. angst while those gathered for recognizing the importance of alerts and warnings and for your continued support of integrated public alert and warning system also known as ipods. as many of you know, our program really has tried over the past two years and again that has

been really due to our partnership with the sec and the relationships we build with the industry. we've established, mueller protocols is a standard now to outreach programs and relationships and made a turnaround for program at all. how it helps us reach more than the american population of emergency occurs, what to first ensure you eas to make a critical element in alerting the public. we completed two preliminary tests as jamie mentioned in alaska and found the functions as advertised at first the technical lesson to modify procedures, but with a basic understanding in basic agreement that has been advertised. we have shared findings at the fcc and broadcasters and in november we will show the american public will have courage to conduct an end to a nationwide test of the system and from there we'll value bait

the outcomes, take steps to correct efficient he is and will move forward from there. that it has, we are simply hoping it would work as planned. as we reanalyzed the test given to snc nonpolluting american public, we quickly realized the commish in the test was more complex than the old economy you can't have in the 1950s. multiple means and methods in the to be at all levels of government and needs to reach out the american public. so when we decided that we would -- we also decided we needed a way to include technology new safety is the dirty exist that need a way to incorporate emerging technologies. so we threw out a concept we have requirements-based approaches and really developing applications based approach. so when we apply this approach, the fema same aggregator becomes a device that we can now use to exercise the existing cable

abilities, but open countless other applications that not even considered. so we abandoned them my way or the highway approach for the common alert protocol standard. once that was approved, that shows the leadership of the nation we are looking much further in the future and standing standard for interoperability for all alerts and warnings. now if an inventor wants to develop a piece of equipment, emergency managers can know and peace of mind that the equipment is compatible with any message that the federal government may send in any message they want to generate at their level. we've opened up the opportunity for development of countless benefits to the american people at the same time. the potential is boundless. now we can take emergency technology in the midwest for example and incorporate that. we can incorporate initiatives in the southeast.

.. to isolate the household effective and send multiple messages to affected communities with instructions on how to protect themselves. as another exmple >> as another example, national public radio developed technology that can take onelo f our messages and insidiously translate it through voice, through a soyuz -- voicethesizo synthesizer to a braille reader. so the sky and imagination are d

only the limits that we have to how we can alert the public toto imminent danger. eminent danger so to close again, thank you, commissioner and mr. chairman and commissioners for your support and in particular thanks to jamie and his team lisa, greg, eric, tom, david, bonnie, tom, jeffrey for helping us make this a reality and taking a great step forward. thank you, sir. >> thank you. >> he's saving his voice for hurricane season is available at request. [laughter] >> thank you come all of you. let me ask my colleagues if you have any questions. >> i think it is great news we are going to do a test of the úa system. ú it's a ú national challenge buta also in national opportunity toú develop a system that we are going to increasingly rely on t@ deal with national crises and weather emergencies and man-made emergencies and anbar alerts and

objected children, and i want to highlight two things. i want to commend the public-private partnership that is behind this. he mentioned the stakeholders and participants and it's a pretty wide range of folks, so getting them all working together and coordinated and pulling together for the common good is admirable and i congratulate you on that. it works best when we can do that we found that out during the dtv transition just a couple of years ago. i also want to commend the interagency coordination that you've done here, david and mark and others, too. this is such an urgent priority, and we have to have absolutely seamless coordination and cooperation when you talk about coping with disasters like the ones we have in recent months and recent years, too, so i want to commend that interagency

cooperation you've done here and i want to particularly commend the admiral for doing the same thing on other issues that are under your office and the bureau, so i think that's commendable and a wonderful example for all of us as we seek to protect people in the 21st century. thank you coming and i wish you luck in the test. obviously he will run into some problem but you are already learning from the alaska@x@p experience. i think that's great and we will learn a lot from this one, too. i have your here. >> thank you. >> i would just echo the words of my distinguished colleague that as i travelled the country in the past five years i have heard frequently from broadcasters and public safety officials etc the need to do exactly what you're doing so this is a historic step. we are going to learn a lot and make great progress here and

it's going to help protect the system and the resources of the great nation. thank you for doing what you're doing and we look forward to learning from it and hearing more about what comes about as a result and how we can learn more and do better. thank you. >> thank you. commissioner? >> i commend the staff of the public safety homeland and community, community also the security, noah and fema for the hard work necessary to conduct this first effort top to bottom nationwide test of the emergency alert system. the goal is that all americans as they are turning into their favorite tv or radio station at 2 p.m. on november 9th should be able to see or hear this test alert. those, like me, who hail from states vulnerable to hurricanes know all too well the value of timely communications in emergencies. therefore, i am glad that under the leadership of chairman

genachowski and the admiral barnett that this commission is doing all it can to ensure that all americans have access to and rely on the national eas. thank you. >> thank you so much. i want to echo a couple of points. one, interagency coordination. it's symbolic that we have here not only admiral barnett from our team but fema and the national weather service, because we know that proper emergency alerting and response in the country can't happen without effective, efficient in their agency coordination. and the three of you here reflects a tremendous amount of interagency coordination that occurs on a regular basis and includes agencies that aren't represented here today. that's a big deal. i commend everyone for working together on this and it's reflected by the presentation

today. a second point is that this is as commissioner mcdowell said this is historic. and in fact, we are what is developing to be a series of historic steps when it comes to emergency alerting and response. so this specific test, the first top to bottom test of the eas is itself historic but the other steps touched upon today are some that were also part of a full set of initiatives that are targeted at making sure we are harnessing modern technology to communicate with people in the way that is effective in times of emergency. and so what we all grew up within the traditional eas system remains very important.

but can no longer be the only way that we seek to alert people. and the work that has been done in the last several months on plans, the mobile alerting service, that's a very important part of this puzzle. the interoperability that you mentioned in the systems and protocols is a very important development. the progress that we are now making on getting in national and air operable mobile broadband public safety network up and running yesterday the senate commerce subcommittee or full committee approved important legislation in this area. next generation 911 where there is still a lot of work to do, but it's now a matter of what is

being actively pursued in another area where i believe we can make progress of historical significance. so for all of that, on behalf of the public, we are grateful to the work that you're doing and we know that the eas test is extremely important. and again, i think one of the most impressive things of the presentation is that you're thinking about the eas test, not in a vertical silo, and related to other emergency alerting mechanisms, that you're thinking about playing field, and that makes complete sense because from the perspective that an ordinary person you just want to make sure you need to be a little something that's going wrong, that there is a way to reach you wherever you are, efficiently so that you have information you can act on and save lives and protect your family. so, very appreciative of this presentation. thank you again, to that for all

barnett and your great staff to fema, the national weather service, we look forward to further reports and the work that you're doing. d d@f@f@b thank you. >> madam secretary, our next item, please. >> the final item on your agenda impact of technology on the information needs of communities >> before it turned over to steve for his presentation let me say a few words of introduction. in 2009, a bipartisan commission of the knight foundation looked at how technology is changing the media landscape and affecting the community. commission called on the fcc to

examine some of the issues more closely, and i asked steve walden to come to the commission to lead a working group to do so, to assess the landscape, identify trends and make recommendations how the community's needs can best be met in a broadband world. today, i am proud to say that they have completed and delivered the report. the project share, steve walden is here to present the key findings and recommendations of the staff report. but before i turn it over to steve, a few brief comments about the process and steve's remarkable team. anyone that reads this report will be impressed by the thoughtfulness of the analysis and its recommendation. the report's findings and recommendations contained a strong and hopeful through line. there's never been a more exciting time than this broadband age to achieve our founders vision of the free democracy with a free press and informed and in power citizens.

as the report identifies and so the prince the potential of new communications technologies, it also highlights important gaps that threaten to limit the potential. the report does all of this in a thoughtful and fact based way with a full grasp of the opportunities of new technology as well as deep respect for a long established forms of media. that the report deserves this description is no surprise given steve walden penn press, diverse unique background. steve worked for many years as a highly respected reporter and editor at publications including newsweek and u.s. news and world report. he's also a successful internet entrepreneur, having created an online community that had millions of americans as regular users and he also wrote for "the wall street journal".com. he was the ideal person to lead the effort on this report, and

on behalf of all of us, thank you for your service. this was a group effort within the agency great example of collaboration across departments and grateful to all the staff who worked on this often squeezing on top of their other responsibilities. i want to especially note the deputy chief of the office of strategic planning and the senior counsel, senior adviser for the extraordinary work. i also want to note just to lead into the presentation steve attracted an impressive collection of outside journalist academic and scholars to help develop the report that improved professor james hamilton of duke, ellen goodman of rutgers, peter shalem ohio state, cynthia come rf ann byrd. the team conducted more than 600 in-depth interviews and a very diverse range of people across the country held multiple public hearings, made numerous visits and newsreels across the country analyzed scores of studies and

compiled more than 1100 comments from the general public. the commission takes pride in this process and in the final product. with that, i would like to turn it over to you to present your findings and recommendations. the floor is yours. please take your time. >> thank you. it has been a great honor to work on this project with this great staff and with the commission. as you mentioned this project was launched at the beginning of 2010 when it was very clear that we were in a time of rapid and seismic change in the media world. you have on the one hand a tremendous innovation, additional innovation everywhere and every day and at the same time newspapers closings, staff layoffs and the media going through a very serious contraction. so, the idea was to therefore

take a good hard look at this and the answer to basic questions. one is our citizens and communities getting the news and information and reporting that the need and what. second is policy that the fcc and others are in sync with the nature of modern media markets especially when it comes to encouraging innovation and advancing public-interest goals. the process, as you mentioned, we created an informal working group that basically demanded extracurricular time from many people at the agency across many departments as well as bringing in some really outstanding outside experts to help. would it more than 600 interviews and has a wide range of people we interviewed. media executives, such as leaders, foundations, investors,

conservatives, liberals, the old media, new media, really very broad range. we had to public workshops, public comments and significantly we also did a very careful literature review because we're the first ones to study this, there are very outstanding studies and reports that we made great use of. as you mentioned, we were very fortunate to have a really outstanding team, and you mentioned the key folks, elizabeth, andrea, james hamilton, ellen goodman, peter shane, cynthia knard and tamara who worked hard around-the-clock on this. we also as you said had people throughout the agency working on this. i'm not going to read all the names as we would use up all the time there we can see that we

had contributions from every department which is fitting for the nature of the modern media landscape which isn't silo in the traditional ways that, you know, the agency is divided up. and we made a very aggressive use of free labor and in terms that too much of their work to do and this is really gratifying process. i have to say of all the exciting moments the most gratifying moment in the entire process is when one of the folks on the stuff, and i won't mention his name, who said the first four drafts were horrible, said the fifth draft was pretty good, and i know we were finally ready to release. just starting with the six come the first principle that actually has to guide all of this is the first amendment. this confuses a lot of what we

talked about and the way that we approach the recommendation as a journalist and i take them very seriously that while we care very deeply about what is happening with journalism we also have the first amendment as the basic parameters for how we approach this both in terms of guaranteeing freedom and placing the limits on the government intervention. the way that the report is structured and by the way the report is now as i have on the web site is a major section on the media landscape which is a description of what is happening in the landscape right now. we broke into the sections on commercial media, nonprofit media, non-media institutions by which we mean there are lots of ways people get very important information that don't go through the media. and libraries, schools,

government websites, and those are increasingly important ways people get information devotee of the policy and putting the fcc's policies and track record and i am proud really of the commission a pretty tough as some of the fcc i think that speaks well to the commission and its desire to get the right. and then we have recommendations to the recommendations are not only for the fcc. we took the sec recommendations very seriously but we also spoke about possible ways that other players in the media landscape can help. the main findings and and not shelf are that first most of the media landscape is actually very vibrant, tremendous amount of innovation will go into more debt about that, but that is a

central point. and there are some very serious issues and especially the one we keep coming back to over and over again is what we believe is a shortage of local accountability reporting and since i'm going to use this word accountability reporting a bunch of times, i should define it. this is basically things like covering city hall, the school board, the state house, the basic civic institutions holding those institutions accountable and the information citizens need, so it very interesting moment where these elements will mean serious harm to communities but paying attention to them will mean we will be able to create i believe the best media system that we've ever had. i know that sounds like hyperbole, but i think when you consider the advantages that have happened and the serious

gaps are going to be in a very exciting moment. so first let's talk about the basic backdrop that helps us understand what went on. the contraction of the traditional media. it was sometimes said newspapers would have been a better position of the hit just grown their web traffic and if it were only that easy the truth is that from 20005 to 2009, newspapers online web traffic doubles and digital revenue grew $616 million which sounds like a very big sum until you hear that at the same time it lost $22.6 billion this led to the newspaper business print dollars for being replaced by digital lines and if you look at the numbers hard it is print dollars being replaced by digital pennies, and that is the nut of

the problem is that it's very hard to outrun the losses in the traditional business model. what are the implications. we ended up focusing a lot on the needy gritty subject, which is staffed. what happens and newsrooms when these kind of revenue contractions happen? and it's a really distressing set of numbers when you look at what's happened with traditional media. just in the last few years which means it's now down to the level newspapers had before watergate. a tv network news staff are down by half since the 1980's. news magazine, where i used to work, down by half since the

1980's. if you look a particular communities shall finish to see how this plays out you see the impact. so a study by a few which system the best work in this area of baltimore the look of the "baltimore sun," the "baltimore sun" produced 30 more stores in 2010 years earlier so look at philadelphia these available news but public issues is dramatically diminished over the last three years by many measures air time story account and keyword measurements. if you look at a particular news room, the news and observer in 2000 for they had to hundred 50 newsroom employees. by 2011 they had 103. it doesn't take a lot of imagination to see that that can have a really serious impact. and specifically some of the beads that lost reporters, courts, schools, legal affairs, agriculture, environment, state

education, fundamental issues of concern is to citizens and of the health of american communities. statehouses. from two dozen three to 2008, when spending by state governments went up by about 20% the number of people covering state government went down by one-third. it's not a good formula if you are concerned about safeguarding taxpayers' dollars. investigative reporting is down. this is a hard, this is hard to come up with numbers that are exactly, but to lose. membership in the investigative reporters association from 2000 to three was 5300, and now it is 4,000. the number of submissions for the public service categories and the pulitzer prizes is up 43% from 1984 to 2010. coverage of washington, the washington bureau, 27 states have no washington reporters. the number of your nose down by

about a half since the 1980's. religion, religion coverage a topic dear to my heart my chicken with a religion news writers and said what happened in the last year with a set of religion news a the local level was nearly gone, which is very sad because the previous ten years had been a period of real growth in that area. hamsterization this is a term a columbia internal review referred to about a hamster wheel and this is the phenomenon of reporters who now have in addition to their regular beat the have a second beat and right for the website and tweet and are learning how to do video it creates the sense they feel like they're hamsters on a wheel. since the work of the federal government i decided to bureaucratize the phrase a little bit and we are now referring to this as hampsterization, and this is a

process of when you don't necessarily eliminate the become it's like it's not like there's no one there covering it but reporters are stretched and it means to use a different metaphor if you're talking about a media landscape there are still reporters who can look at the landscape and describe what is there but they have less and less time to turn over the rocks and look in the shadows. you can see in the case of calls reporting eighth important topic, the kaiser foundation did a study and said its interest in health coverage is up, the number of reporters is down and they concluded a result of that was a loss of in-depth enterprise stories. education, there's lots of education reporters, but they are less ambitious and doing less debt. same thing with local business reporters. the ceo of bloomberg said it is currently not a market well served. now, i think this obviously has, to communities.

it's wasted taxpayer dollars, corruption, schools, the did simon who was a former reporter the "baltimore sun" who may be is better known as the producer of the lawyer at a senate hearing said it's going to be one of the great times to be a corrupt politician and i wasn't there so i don't know who he was looking at when he said that, but i thought it was a very exciting moment. now it's very hard to prove in this case. we are talking the impact is on stories not written. so how do you prove that, how do you prove what the impact is? and we try to get at this differently. we interview reporters about what are you doing now compared to what used to do? what did you use to do that you can't do any more? we looked at stories where there was journalism done after the crisis. so for instance, one of the worst mining disasters in recent years is the upper big branch mine disaster in virginia. some fantastic journalism was done after the disaster finding

there were more than 1300 violations on the books. so one can only imagine what might have happened, whether there was 29 workers who died might not have suffered the fate of the journalism had gone before the disaster or if more of it had been done before. california is agree to example where the l.a. times eventually did a terrific piece about the chief administrative officer and a working-class city in california who was being paid more than $787,000. this was going on for five years, and because bell had no one covering it, taxpayers wrapped up $5.6 million, so we can only imagine if there had been a reporter there whether or not taxpayers would have saved them. as often happens, in situations like this, it is it tends to be

the least powerful and the most vulnerable and we were touched by people who talked about not necessarily journalists but people in communities on the front lines to solve problems for communities about this happened to their lives and effectiveness of solving community problems as the contraption that happened. as for instance, an expert on the family court system in michigan said coverage has gotten smaller and smaller in the years. why does that matter? what's the impact? he says well, for example, parents whose rights are terminated who shouldn't be terminated it just takes somebody down there to get the story but nobody has ever been down there. one thing that surprised me a little bit is that because the internet and digital tools and general has been so in powering and you can see this in the literally the effect of the

internet on helping to topple governments, and in many ways in the ability to have users and citizens engage in the media it has been a very in powering experience. so it surprised me a little but we found a countervailing shift in the other direction but when you don't have a sufficient accountability functioning in communities it leads to a power shift in the other direction towards institutions and government away from citizens and this is because reporters basically right from press releases and don't have time to dig is a for instance the que study of baltimore said reported as news is supposed to faster with little enterprising reporting having the officials version is becoming more important. we found official press releases often appear word for word in first account of events though not often noted as >> government nationuates most of the news, so i've talked about newspapers so far in great

depth because newspapers play a special role in the ecosystems and tend to be the bulk of the reporting, so the contraction of newspapers has a ripple effect. they are not the only players, and other media played really essential roles, and i'm not going into so much depth, but i want to quickly go through. radio played an important role providing resources in community, and in some ways, radio is actually doing really well and thriving. national radio, public affairs, news, talk is booming. it's a very vibrant area. at the same time, local news is not. there were 50 all new stations, local radio stations in the mid-80s. there's only 30 # now, a third of the population has the benefit of an all news radio station. the number of reporters who work

for local radio stations have been down, and the media number of people employed in a social news room has been one for quite a few years. tv news -- i want to talk about tv news. this is a really very interesting and in some ways exciting time for local tv news. in many ways, local tv news is more productive than it has been perhaps ever. in the last seven years, the number of hours has risen by 35%, and they are increasingly doing very creative things. they are using their multicast channels more creatively. they are starting to do more mobile applications. they are doing user generated content. it's really a great opportunity moment for local tv news. they are still the number of one source of news, less of a market share than they used to, but

they are still the number one source of news. they are an increasingly important source of online news, and the newspaper contracts creates an opportunity for them to do more original reporting. technology makes -- technology has gone down so they were able to hire more reporters, and they are relatively profitable, meaning relative to everyone else in the community. they are not as profitable as they used to, but actually they had a pretty good year, and in many ways local tv news is more important than ever, and i really want to highlight that, you know, i actually -- since i spent most of my time in the print world as a journalist, i can admit there is sometimes a little bit of a snobbery on the part of print reporters towards tv news, and i have to say i don't agree with it because -- i've done mass circulation journalism and narrow circulation journalism, and there's nothing harder and more valuable than coming up with really serious substantial

reporting, but packaging it in a way that's available and accessible to a very wide range of people, and the best local newscasts do that. they do investigative reporting. they do news that's really heart and soul of what communities want and need. the next slide is an interesting one, and it's basically -- this is basically the volume of local news minutes. on one axis, the left axis, and the market size on the bottom axis, and what you can see is as you get to smaller markets, there's less local news produced and the economics of it become more challenging. of course, there's a lot of variation as i think this points out in local news. many that are really seizing the moment and doing very exciting things, but some are not, and i

do believe that some local tv news operations are not seizing this opportunity so we have a few problems. first, the old phrase if it bleeds it leads -- still true, maybe even wars than ever -- worse than ever. the beat system, less and less is that true, meaning there's less expertise developed. a study of the l.a. markets showed that the results of these two numbers really are pretty shockingly small amount of time spent on civically important information. specifically, they said that a little over one minute of a typical half hour newscast was going to education, health care, civicically important topics like that. i think one of the most alarming things we saw was called pay for play, basically situations where

a station will allow a advertiser to dictate content. in some cases, it's an advertiser that says, yeah, you can have an ad deal, and all you have to do is promise to interview people from our hospital or work off the story list we've created for you. in one show, they were charging guests to appear on the show. things like this, you know, it's -- this is not the majority of stations by any means, but nonetheless, it's a really serious problem, and we had mixed evidence on whether or not it was merely persistent or whether it was growing, but in any event, it's a big deal. another thing that worried us somewhat is at the same time, the amount of tv news produced is up by 35%, but they did this while cutting staff on average at tv stations.

now, some -- in some ways, there's some real legitimate efficiencies built into the system that allowed them to do that. the term is one-man band, and that means you used to have a crew of a reporter and a sound/video person or if it was a network show, you had a three or four person crew, and one-man banding is a as a result of the technology. the roarer can be the videographer and sound person as well. in some ways, a fantastic development. some reporters say it's great. there's not a whole crew with me, so i can get into city hall in a way that's less conspicuous than i used to. it makes me more mobile and go more places. a number of people say said this could be a fantastic development. instead of 20 reporters and 20 crews, we can have 40 reporters. that's not happened. instead of 20 reporters and 20 crews, we have 20 reporters or

maybe 18 reporters, and as a result the reporters are doing more in addition to doing the reporting. they do the shooting, the audio, and filing for the website and tweeting. in some cases, this works well. i want to make it clear, i'm not of the view this is an inhairnltly bad thing. i don't think many stations used the inefficiencies to seize the opportunity they had in local markets. now, i just offered some criticisms of local tv news, but it should be said even the ones i've been talking about are at least during low kl programming. we looked at the question of, well, other stations that are doing the local programming at all. you know, there's a limit to how granule we could be on this, but we did through three different analytical approaches looked at this and they came out in the

same direction which is about 21% of stations do know local news, and if you add in stations that do 30 minutes or less, that's about a third of the stations. now, i am offering no comment on whether that's good, bad, or indifferent. i think it really somewhat depends on the situation. it is not necessarily obvious that we would all be better off if ever station in america did local news, but it is nonetheless an interesting phenomena, and one of importance to the fcc to understand this, that not all stations do local programming. so, we've been talking about the contraction of the old media, so two pointsment first of all, two years ago when you talk about the traditional media, there's bifer cation between the new and old guys. now the newspapers and radio stations are doing innovative things online too. they are the internet, you know?

just as much as they are a print thing. that's a distinction that's getting blurred despite my use of this glib phrase. the second thing is that this is just part of the story. if the -- if all these contractions happened, but they were being filled in by the growth of the new media, we'd be in great shape. that was a central question for this. we know there's a tremendous amount of activity, where it's filling in the gaps, where it's not filling in the gaps? we could spend the entire time talking about the incredible bounty of innovation that's happened as a result. i'll try to summarize them. i think we have a sense of them, but lower barriers to entry. the vast amount of space online led to greater diversity in voices, increased depth for types of coverage. sometimes i think there's an idea that the internet is good for providing a way to mouth off with uninformed opinions. no, the internts provides

opportunity for tremendous depth. technology reduced the cost of gathering news, reporting news, and delivers news. if you enable a person to do a story in two hours that might have taken two weeks previously or the cost of publishing images or video or the most obvious one of all which is you can use a search engine to find things out that used to track you -- take you three days to find out. citizens are empowered. what are the most seres news images from the 197 # 0s? images come to mind, and there's images shot by brave courageous professional photographers. parole the most sering image that we have now is the image of an iranian martyr being shot because she was protesting. this was shot by a citizen's

cell phone, and that gives you a sense of the potential power of user generated content. we've also seen an explosion of new websites. you know, a lot of the ones that get the most attention are on the national level, the huffington post, daily caller, "politico," also very exciting stuff happening on the local level. men post, tribe biewn, names you'll be hearing more and more of. these are entrepreneurs concerned about what's going on in their community, saw a gap, and moved to try to fit it. some are for profitings, some are non-profits, but brought tremendous energy, and some are becoming self-sufficient and profitable. as i said earlier, these are attributes, tools that are no longer just limited to what we

call web native businesses. they are bleeding into all sorts of different media. you know, maybe one of the areas that is most obvious is hyperlocal news. hyperlocal is kind of a buzz word. well, it's a word that had to be invented anew because it didn't exist before or didn't exist in the same way that's happening now. that's because the media models were such that it even in the saddest and happiest days of newspapers, they could not get to a house-by-house level. it was not economic. you had weeklies and things like that, but hyperlocal information is more vibrant than it's ever been. a lot is commercial enterprises, but civic enterprises, and not profit l, but they don't have to be. it's a thousand points of journalism sprouting up in

communities around the country. now, this year, in 2010, sorry, as a result of all these changes, a major milestone was achieved that this was the first year more people got their information from the internet rather than paper newspapers. the left chart is the youngest cohort and the right chart is the older cohort. you can see which way this is heading. that is the story of abundance, but what are the counterintuitives things we found? despite this abundance, it turns out you can have an abundance of media outlets and a shortage of reporting. again to return to baltimore where the most in-depth study was done. they found, yes, there's an enormous prorifflation of ways people can get their knews,

ballots, blogs, radio stations, newspapers, 53 outlets doing real news, but then they did a content analysis looking at the articles, the story on the tv news, and they said what was the source of the reporting? they discovered that most of it came from the "baltimore sun" and one of the tv stations. by the way, "the baltimore sun" is doing less than they used to be. this is the iron core of reporting. it's the iron core that can then be scroll ped by others in the media food chain. if the iron core is shrinking in mass, there's less to work with. by the way, it's not just the pew study that found it, but several studies looking at it from several angles that came to the same conclusion. so we really came to the conclusion that on this one area of the local accountability

reporting, so far the new media is not filling the key reporting gap. this was driven home to me once when i was at a conference put on by the knight foundation, that's taken a tremendous lead in funding and stimulating innovation in this area, and they brought together a dozen of the leading local news sites, the topmost innovative and well financed of the news operations. they were at the table, discarding what they were doing, and how many reporters they hired, and i counted them up, and it's 88 roberters. that's good until you consider the fact that 15,000 reporters have left newsrooms in the last decade. it gives you a sense of scale. the energy is there, the excitement is there, the quality is there, the innovation is there, the scale is not. another study from the institute said there's been a drop of $1.6 billion a year of spending from newspaper newsrooms. foundations have been trying to

make up some of the difference by pouring money into it, and, in fact, one study said they put in $180 million over five years, but that math tells you something, $1.6 billion per year out, $180 million over five years in. it's led experts in this area, including folks who i think are web evangelists, people who have high optimism for the nature of the web to conclude that there are some gaps that are not being filled. michelle mcclown did a sur survey of the studies says the tired idea of web sites replaces traditional media is wrong headed and it's past time reports reflect that. an internet investor said news startups are rarely profitable, no thinking person who wanted a return on investment would invest in a news startup.

i hope she's wrong, but that's her honest assessment of the current situation. why is this? some of it what we call the great unbundling, and this is something that i think we were not really conscious of before, but the internet has made us conscious of it. turns out when you bought a newspaper, you were essentially sub subsidizing an elaborate cross subsidy scheme developed by the newspaper. you bought it because you wanted the box scores, the horoscopes, and maybe the detailed international coverage, but perhaps you were buying it for the box scores, but you your subsidizing the bad guy bureau or the city hall reporter. now, you don't have to do that. yo can go straight to the website with just the box scores, and by the way, it's belter experience. they change minute by minute. i had an experience i was

stairing at the box scores in the newspaper waiting for it to change. there's another cross subsidy happening or bundling on the advertising side. the advertiser was quoted, and i was unable to determine whether this was apockful or not, but he's quoted so often saying this. "my people say i'm wasting half my advertising budget, but they can't tell me which half." now he knows which half. now the precision of add target -- ad targets enables any advertiser to know who look at the ad, who clicks on the ad, whether it's the right demographic, whether the people clicking on the ad buy the product. it enables advertisers to be efficient. it is one of the main factors leading to a decline in ad rates.

ad rates online are a fraction of what they are offline. if ad rates online would be the same as in print newspapers, we wouldn't have this conversation. the problem would be solved. the revenues would be at such a level that it would more than pay for the journalism that we've been talking about. with lots discussion before, why is this? i won't go into all of this, but one of the issues is something that economists refer to news as a public good or a free writer problem, and the issue is there that you can get news without paying for it. that's true. you can benefit from news without paying for it. one of the examples in the report was from the news observer in raleigh did a fantastic series about major flaws in the probation system where people were getting out of jail on probation too early and killing people. there's 100 people who died as a result of the flaws in the probation system. the newspaper spent several months doing this study.

they uncovered it. the governor fixed it, and now there's people walking around the streets in raleigh who are not dead who would have been probably, but they don't know who they are. there's no way of knowing who they are, and what's more, they didn't have to subscribe to the newspaper to have benefited from what the newspaper did, and this is just a basic fact of the way news of the public good works. it's not something that -- it's not a geneny to put in the bottle, but an explanation of why it's hard to make these models work. another aspect is that advertising is increasingly disconnected from content. used to be advertisers wanted to be next to content because it was a proxy for reaching a certain type of audience. if you wanted to reach women age 25, you advertised in madam gazelle because they read that. now you can go directly to the

demographic. it's true for search engines. it's really a remarkable chart that shows the percentage of online advertisers who went the search engines in 2000 was 1%, and now it's 47% of the the same is true for the new technology, groupon, social media enables immediate yo do to go to consumers without putting ads next to content. it's good for consumers, but less revenue for media outlets. i've talked about the commercial media, and one of the most interesting things about this to me is learning more about what's been going on in the nonprofit media sector. they have become a much more diverse, varied, evolving, innovative sector and really is an important part of this puzzle, and it includes a number of places that we don't think of as being part of this riddle. public access channels.

public access channels realize that their original mission, a platform for people to speak out, is taken over by the internet. they are trying to evolve and putting an everyone miss on digital literacy and accountability. journalism schools used to teach journalism the way, you know, through a book, through the classroom. they refer to the medical school mod dell now saying let's teach journalism by doing it. this is great for the students, but also great for the communities. you have thousands and thousands of journalism students, boots on the ground in communities not just doing abstract exercise websites. they are building real websites that real people read. foundations are starting to play a major role. low power fm stations which are already important players, and our hope is the passage of the

recent law and the forthcoming actions from the fcc will make them even more so. the nonprofit news websites, we've spoken about, very exciting era. i talked about the local ones, but there's national ones like propublica. they saw an insufficient in reporting at the local level, so they created something, and within the first year they won the pulitzer prize. there is not an inherent gap between print or web, good journalism can be done in any form. i really want to pause for a second on something i was unaware of which is state public affairs networks. these are basically c-spans on a state level. as spending by states has gone up, the number of state house reporters has gone down. there's 23 states with state

c-spans and they vary in depth and quality, but they show the legislative hearings, the floor, and they do candidate debates and issue forums and things frankly that the local tv news would do for of, that some of the states are doing it. in only four cases are the states funded by the cable operateors in the way the cable industry funds c-span. in a quite a number of cases, they are funded by the state, which works okay, but i don't think it's the best model in the world to have the state funding the issues of the state. obviously, the biggest player in the nonprofit media is public tv and public radio. we went into great depth there looking at what they do, some of the structural issues, how they are evolving, tremendous

innovation online in the public media space as well. to break it down a little bit further, you know, on the public tv side, there's real strength in educational programming, cultural programming, national public affairs, everything from, you know, front line, news hour, firing line to date myself a little bit. we would say though that we think it really is not that much local programming on public tv. very few public tv stations due to local news. we were not anal to get a solid number on local programming, but that's not really what they do for the most part, and there's economic limits on that. public radio actually is trying to do quite a bit more in the local news space. from 2004 to 2009, actually the number of public radio stations reported that they carried local news or talk rose from 595 to 681. they are trying to step into the

gap that they see in the market, and especially the gap we talked about before where commercial news radio is not prevalent in a lot of many parts of the country. we're also seeing, i think, a very exciting development which is increasing the number of collaborations between the commercial media and the nonprofit media. i used to think of these as sort of parallelled universes operating separately from each other, antagonistically from each other, and now there's interesting relationships evolving. one, for example, knsd, the channel four, the nbc station in san diego says we want to do more in-depth work, we don't have the staff. meanwhile, one the exciting new startups, the voice of san diego, was doing great work, so they worked out a deal. voice of san diego goes on the show a few times a week, doing a

segment called san diego explain, and another one called san diego fact check. it makes the newscast better, and it's a huge value to the voice of san diego that gets fantastic exposure, and they go back to their donors and say look at the impact we're having, and we're seeing this actually quite a lot, and i actually, you know, i think it's actually potentially a model that five years from now we may look back at and say this became a really significant element in this new ecosystem. now, it does, to work, it requires the nonprofits to have a critical mas of revenue, functional business models. where does this leave us? the diagnosis to oversimplify this is, i think, hyperlocal, better than ever. local and municipal level, state level, really struggling. national, we really haven't talked that much about and

that's because i really think that it's quite a dynamic sphere. we all have our complaints about, you know, particular national media or things we like and don't like, but i really can't believe it's very dynamic, vibrant, and business models are taking hold on the national level on ways they are not on the national level, so not worried about it. international, i think, is a mixed bag. on the one hand, clearly some of the players we used to rely on for international news are gone or have pulled back. i mean, the regional newspapers like the "chicago tribune," "l.a. times" basically packed up and do much less. the networks do less, but on the other hand, we have more people on cable news. npr