record second you have individuals making very quick determinations'. they have a large number of people to get through into the general prison population and very little time and if we get from the mistakes can be deadly. >> supposedly the concession is permissible to require everybody who is arrested to disrobe and shower under the observation of the corrections officer from a certain distance. now the question would become how many people who do that will still be able to smuggling contraband? >> there would be contraband that would be in the body cavities and we've documented in this record and other records in the brief the contraband is and found until they do -- >> i overstated the strength of your evidence or understated it. san francisco's point is really

tough 30 to 60% or some very high percentage of people who come in for minor crimes are high on drugs or have been if there is that foot node with a few examples definitely they, are there. in this category would be helpful if you included in the excluded part people who are high on drugs? we give you the high on drugs people is there a way of drawing this rule to catch most of the people? >> the fundamental question is who is supposed to be doing this and use it in case after case after case you are going to defer to the officials seeing this stuff. since it is the simplest thing for any officials to say do it for everybody so the fact they do it for everybody and don't try to make an exclusion for traffic violators or something might be consistent with little or no evidence or might be consistent with some.

there are good reasons to have a policy to do it for everyone it is easy to administer its done for the protection of people like the petitioner. >> there's so much sand to that why isn't it a federal policy? before you said because there aren't that many offenders. if there were more with of the federal policy change people in contempt charge and minor crime we estimate they think the blanket policy is a good one and made one modification to the policy in 2003 when the weight of the circuit was against it but this is a policy and for everyone protection. the point justice kennedy made earlier. >> they think it's a good policy to inspect every one? >> everyone who would be put in the general jail population that is the third circuit holding and what we are defending the case because when you have a rule

that treats everyone the same you don't have folks single or any security gaps. >> thank you, counsel. mr. gould steam for four minutes. >> i have three points to make the first is my friend from the united states says the fer to the experts but the point the united states consistently omit its is that there are 600,000 offenders could go to the federal system every year i don't understand the claim this only involves 1% of the federal offenders. the marshals service and i.c.e. at 600,000 offenders every year under our standards they are not kept in several tv to support housing. 600,000 people is their expert judgment subject to the standard when they are admitted to jail. the second point about the numbers, justice breyer there is a significant study and that is the county of orange the district judge did in on believably detailed job going for the record of 26,000 admissions and was unable to

identify only a single instance contraband would have gotten in under the reasonable suspicion standard and there is evidence in this case and the offense to my surprise my friends keep pointing to there's a memorandum from the essex system page 70 to 71 of the appendix tells you relevant things it says every year they admit 25,175 people in to this jail and they only found 14 instances of contraband and they don't even make the claim those 14 instances out of the 25,000 would not have been found under the reasonable suspicion standards and you have evidence in the record about this particular case. a third come a couple points have been made about whether justice lawyer you asked whether someone who's ha on drugs the uniform rule and the expert standard of the correctional association what they say is that essentially almost anything will do. what will not amount to a

reasonable suspicion is when you have a minor offenders and we do have 700,000 people in jail in the united states every year for misdemeanor offenses this is a lot of people who are having a very significant intrusion on privacy and the expert standard the rule applied is when you have people that come in on a minor offense they don't have any drug history they are not high on drugs. there was no opportunity to hide a weapon i am not sure where they think the gun is going to be hit in that's not going to show up in the close manual pat-down that they do that isn't going to show up to the estimate i don't think that you were arguing for an individualized reasonable suspicion sander i think that you are arguing for a rule that draws distinctions based on the categories the fund only roughly to the reasonable suspicion. >> first, there are real categories that were in favor of the jails like if it is a series of evin said.

and on the individualized basis the jail can articulate that would do as well. we are not saying people would be excluded from being searched. the entire category is they would automatically be searched. don't throw the baby out with the bathwater. if somebody is pulled over it is laugh out loud funny to think you're smuggling into the jail but it's too much of an intrusion to put him under the direct 2 feet away i'm going to look at your genitals as opposed to the ordinary intrusion of saying you're going to oversee the shower. there is no evidence when it comes to that and there are a lot of them and they represent anything like the material for at of smuggling and this is a very significant intrusion on individual privacy and dignity. >> thank you. the case is submitted next a

hearing on extending a program which compensates local counties for lost tax revenue on federally owned land in their

jurisdictions. we will hear about a program called payments in lieu of taxes which mainly affects western states. this house natural resources subcommittee hearing is one hour and ten minutes. >> now we are prepared. the subcommittee will be in order. chairman notes the presence of a quorum. a grateful to all of you who are here. subcommittee on the national parks and public forested land is meeting today to hear testimony on the payment in lieu of tax program initiative and it's very important to all constituents of the west. of the committee rules opening statements to the chairman and ranking member of the committee however on ask unanimous consent to include in the member's opening statements in the hearing record and has submitted by close of today a hearing no objection we will do that.

i also ask unanimous consent any member of the full committee wishing to purchase a bit in today's hearing be allowed to participate from the bias even though that doesn't apply to anybody we will make that seen any way. no objection. we are doing it. today we will hear testimony on the history and the construction of pilt and how the payments or configured and how the impact federal land and federal land management decisions we have in our communities. while pilt act to compensate local governance for the loss of property tax revenues for nontaxable federal eland is never fully accounted for the numerous management descriptions of the company of that particular and of all federal public plans are created equal. it does not adjust for variations designation especially if moving from accessible used the more restrictive won on impairment management staff it's become an essential lifeline for the communities and counties and

since more than half of all the way and in the west is unfortunately owned and managed with the government they have a significant impact on all of the world economies of the western states. it's not an equalizer. while that is a necessary source of funds for the primarily western counties although almost every county benefits in some way throughout the country it often does not actively or accurately reflect the economic opportunities would be available through the active management and use of this land. when the land management decisions reduce access to the utilization of natural resources and local economies bear the brunt and too often the economic opportunities and resources including the traditional and renewable energy sources are lost and it cannot and does not fill that void. it is not adequate reimbursement for the absence of the land especially one that pushes additional reductions in the access and use on the public land. claims by the of fenestration and others the designation of the monuments and wilderness, a

boon to the local economies but rather a detriment in most scenarios and i look forward to hearing the work of dr. yonk and his colleagues did, to question the recent testimony the subcommittees have from the economics. or the director of the headwaters economics. america is in the midst of the recession with the unemployment the obama administration continues to push the agenda that competes in natural priorities and job creation and domestic energy independence this is counterproductive of the time the budget for tight around the nation particularly in the west the obama administration to evaluate the impact of the agenda. millions of acres and publicly and in the west without congressional approval and restricting access the energy production and creation of the activities would devastate these communities that bear the brunt of the restrictive land management is a commission. with the expiration of the full funding the mannion fiscal year 2012 the interest and like a devotee of all the residents in stakeholders should be considered and protected when making the decisions.

lee and eustis technician such as national monuments should be initiated at the local level lot of pressure from washington without adequate understanding of the impact on local communities who are too often left shoulder in the her burden. the majority in congress understands that we are a critical juncture when it comes to managing our natural assets and the current state of economic mandates that we do more with less. it is imperative that we begin to manage federal land and natural resources for maximum return on the conservation economic and public benefit and improve management of the federal land and resources to create much needed jobs and and all the conservation efforts and a america more self-reliant. this would help to keep pilt productive and viable. i look forward to hearing from witnesses today and i recognize the ranking member for his opening statement. >> thank you mr. chairman. sorry i was tardy. 1976 congress created the payment in lieu of taxes or tardy -- pilt to insure

compensation for public land to county boundaries. the amount provided under pilt in the pilt program are over and above the revenue generated on federal land which are shared with local governments. since 1976 under the democratic majority, the pilt program has been fully funded. when the republicans took the majority in 1994, pilt was underfunded with appropriations between 40 to 70% of the authorized amount. and it took a democratic majority in 2008 to restore the full funding for pilt is a mandatory spending program for the next five years. but starting in 2013, pilt ligon need to be authorized and appropriated by congress. i'm worried history is about to repeat itself with the majority even allowed pilt to inspire or target significant cuts and funding. just like the secure program which the public is allowed to expire in the 109th congress the republican majority will have to

decide next year with the future is of pilt. the programs like pilt and the secure schools are truly vital to the communities throughout the west, and we must find ways to fully fund them. we must not -- we must not cut pilt and then use the excuse to degrade our environmental safeguards on public land. our public land provide substantial benefits to the states and local counties from travel and tourism dollars. public land on the backbone of the outdoor recreation economy which generates over 730 billion of economic activity, 6.5 million jobs and 88 billion of the annual state and federal tax revenue. we need to find bipartisan solutions to help the counties. we need the budgetary needs. we stand ready to work with the majority on an effective long-term funding solution for pilt. i want to thank the witnesses for joining us today and look forward to the thoughts on these proposals. thank you unai yield back.

>> we are going to have some problems her by the we do have time to get the first to witness testimonies and then we have a break to go back to the votes and then we will come back and finish this panel. dillinger brereton testimony appear in the record. we want to hear your oral testimony and keep it as best you can to five minutes. the lights in front of you vindicate greenup you are going fine, yellow you have one minute left. with that we will start with the deputy assistant secretary for the office of budget finance performance and acquisition at the department of interior. please. >> good morning. as used by the deputy assistant secretary for the finance performance and acquisition and executing the payments in lieu

of taxes is in my portfolio of programs. i have here with me today from interior jason and brian, just wanted to mention their names. good morning and thank you for inviting me to be part of the panel this morning. i have a formal statement and i just have a few brief comments an overview of the program if you will and how we manage the program. many of you are very knowledgeable of the program and its history so hopefully i'm not repeating things you already know. the payments in lieu of taxes makes annual payments to counties to help offset the cost of services and infrastructure incurred by the local charters dictions where certain federal lands are located. payment eligibility is reserved for the local government that contain nontaxable federal land and the jurisdictions provide services related to public safety, housing, social services, transportation and

other services. payments made to counties that have land within them this includes a national forest system, the national park system managed by the bureau of land management, effective by the corps of engineers and the water project. we use a formula allocating pilt a formula that is provided in the pilt act the annual payment to each county is computed based on the number of acres of federal entitlement land within that jurisdiction and population serves as a cap on the formula. the act also requires we consider the prior revenue payment amount from a select number of revenue sharing programs in the calculation of the payment. since the inception of the program the act was passed in 1976 the first payment was made in 1977 since 1977, and through 2011 with the last payment we

made in june 2011 the department of the interior has made payments totaling $5.5 billion from 1977 through 2008 the funding for the pilt program was included in the annual discretionary appropriations. so we stopped funding for the annual budget request and it was considered as a part of the appropriations process. in 2008 the emergency economic stabilization act authorized a five-year program of mandatory funding. so beginning in 2008, we need full entitlement programs to the county's and half through 2011. in 2011 we made payments of 375 million to about 1900 counties. this authorization expires in 2012, as you have already mentioned. so, a brief overview of the administration of the program. payments are distributed to the counties in june to ensure they receive funding on a timely manner and in most cases, the counties have a fiscal year that

begins in july as you know so we are trying to accommodate their need to get the money before the end of the fiscal year. we use approximately $400,000 to administer the program on an annual basis. this is about 0.1% of the total program funding. we use a portion of this to make adjustments to the prior years of payments when the county's come and give new information or federal agencies change acreage. with that i'm going to conclude my patriarchs -- remarks. >> thank you for your testimony. we can get one other witness in the time limit before we run out of time for the votes. i will ask dr. corn who's a specialist in natural resource policy with congressional research library of congress address us now. same thing. five minutes.

>> [inaudible] >> ms. speed come can you make sure that you are on? >> do not need to repeat that? >> go ahead. i've been asked by the subcommittee to describe how the program works for the payment in lieu of taxes. i've submitted written testimony in the form of a report that i've updated recently with the help of some slides from that report i will describe this program. the original program is designed as an overly rather than a substitute with federal payment programs already in existence for national land wildlife refugees and a few other specified areas. the emphasis was on one providing at least some payment to counties his drill and produce little or no revenue from agency payment programs and number two, proportionately more to the counties with low populations that might be less able to provide government services. the result was a formula that capped the payments based on population come subtracted out specified prior payments and set a certain minimum payment to every county with eligible land got at least some pilt payment regardless of the prior payments

from other agencies. there was no which was meant for inflation. the program relies on discretionary spending and the congress appropriated 90% or more of the authorized amount in all but one year from 1977 to 1994. all states have it least some acreage a eligible for the parents but most of the acreage is in the southern states. as the years passed county receiving pilt payments is a variety of concerns particularly the erosion due to the inflation. some counties also want to see more categories of federal land or in the inland become eligible for payments to move to a system of tax equivalency. in 1994 senator hatfield helped hearings of the committee on energy and natural resources and many different views were expressed as virtually all proposed changes would have helped some counties and hurt others to reach a compromise was reached to raise the rates and then adjust rates in later years for inflation. as my next slide shows, the authorization levels rose rapidly.

the program continued to rely on the annual appropriations. so even though the appropriations rose rapidly come they didn't keep up with the authorization level and they tended to focus on the gaps between the two sets of the bars. however, as my next slide shows whether measured by current dollars or constant inflation-adjusted dollars the payments did go up. the reliance on the discretionary spending ended in 2008 with pl1 - 34 tree. this provide mandatory spending authority for pilt from fy 2008 through fy 2012. the payments next summer is the last under this provision and after 20 of 12 the program will return to the annual appropriations unless congress changes the law. to calculate the payment for any given county you need to know the answers to these five questions. one, how many acres of a woman were in the county. the statute specifies which lands are a little and i've shown these on page four of my written testimony.

what is the population of the county as my next slide shows no matter how many acres and regardless of the prior payments county payments are limited by the population of the county and no county is credited with having more than 50,000 people. third with the previous year payment if any for all the eligible land and payment programs of the federal agencies in the next slide, note that as the prior year payments showed on the x axis increase the next year payments under pilt shown on the y axis decrease. only those payments named in the statute produce any offset many prior payment that is not named in pilt as requiring an offset doesn't count. i showed the prior payments could result in the offset on table a on my testimony. for, does the state have any law regarding the payment from other federal agencies to be passed through to other independent

local government entities such as school districts rather than stay with the county government itself? if they do and the county government never actually receives the funds then those funds don't count against the county calculating the next year of payment. five, what is the increase in the consumer price index during the year? my next slide shows a very complicated flow chart as to how this calculation has worked out and i would be happy to go through the steps in this if the committee wishes to read with that let me think you for your invitation to appear today and i will be pleased to insert your questions on this program. >> dr. corn, thank you and for keeping within the five minutes. i know there was a lot of material to cover in that short period. we are not going to call a recess. there are a couple so i am est. maybe 15 minutes, 20 at the most. unless something happens on the floor.

i would ask you if you would be kind enough to do that we will take your testimony and turn to the committee for questions. [inaudible conversations] [inaudible conversations] the committee will come to order. i apologize once again for the length of the delay let's say something happened on the floor. with that, we think the two panelists who spoken already and

we have yet to hear the testimony from dr. ryan yonk from southern utah university. go thunderbirds and your old coach is not related. we are happy to hear your testimony if you would, please respond chairman bishop and members of the subcommittee i appreciate the opportunity to share the results of a number of studies conducted by some colleagues of mine at utah state university and myself, brian and who's here with me today and then dr. randy simmons. as i said as you introduced me i'm the assistant professor of political science at southern utah university with a primary emphasis and the issues that surround public land and how the impact of the communities. i will skip the background in pilt that we have received from the other witnesses today after the and to see the fundamental logic of pilt from this was to prevent the system at the disadvantage of the county's where the federal land holdings would be forever excluded from

the taxable land base and the special recognition of the potential harm of the large permanent federal ownership has unfortunately given way to claims that suggest the ownerships in pos is not a cost to local communities but the benefit regardless of the type of land that are owned. questions about the effectiveness and importance should explore the trade-offs that occurred when large tracts of land are federally owned and the opportunity costs that arise from these sorts of holdings. beginning in 2000 for the center for public land and their role economics at utah state university begins a series of studies funded by the department of the agriculture to investigate the effects of the public land of the rural communities. the studies have focused on health care markets, social services, education, the effect of wilderness on the life quality and on the economic conditions and all share similar results. suggesting that across a wide variety of policy areas the presence of public land has a

non-positive effect on the rural communities at best and a negative effect at worst. for example, we find with regards to education one of the effects of the federal ownership is an increase in the size of the county and school district resulting in increased cost of administration and reduction due to the fallujah leadership -- land ownership. one other example suggests the public land counties for disadvantaged berkeley in their economic conditions. our research indicates communities with 25% of their gross acreage held by the federal government have an average household income that is between $741 to $1,450 per year less than them on public land counterpart. this is not to say these funds are not in the central portion, which rather they are not the

panacea that correct for the myriad of other effects of large-scale federal land ownership. indeed, counties with substantial public land are severely devotee attached win pilt payments are reduced or delayed. we have sort of three examples to present the column to question the idea that in fact federal land are a net positive for the committee. the first is a study that was conducted on the grand staircase monument in utah designated in 1996 by president bill clinton. our evaluation of the monument focused on the most basic assertion presented by those who supported that designation. .. total payroll and

lower total tax receipts in counties where it is present. there's a third example that i'm happy to answer questions about that's incurred called the treasured landscapes memorandum that came out in president obama's administration. and we look at the opportunity costs that are there. to conclude, our research suggests that the reality of federal land ownership and the effect of those lands can be best summed up with two core economic concepts. first, tradeoffs. every policy action necessarily chooses to do something and not

to do others. and the second is opportunity costs. that anytime land is removed from the active economic base there will, in fact, be costs that are difficult to estimate and that counties where these lands are protected have to bear. thank you. >> thank you, dr. yonk. i appreciate the testimony for all three questions. mr. tipton you were here in an earlier session. do you have questions for these witnesses? >> thank you, mr. chairman. and i'd like to thank our panel for taking the time to be able to be here. i guess i'd like to ask ms. hays first, understanding pilt is fully funded for one more year, does the administration to the best of your knowledge plan to have full funding for pilt for the 2013 budget? >> i don't think i can answer

that. that would be predeciding what we're going to do in future budgets. so i'm not really able to say that at this point. >> okay. you know, in your testimony you had mentioned that the payments are typically made in june. >> right. >> there's a decision that was made to delay payments without providing any notice. was it this last year? >> there was a delay this past year, the 2011 payment. >> you know, that creates a lot of problems. i come from a small rural counties that has a lot of public lands. we have one county in my district. we're 98% of the entire county is public land or federal land. and the real issue is that does create a problem for those communities. what are your plans going forward making those counties are compensated properly. >> i'm glad you brought that up. i'll tell you we learned a lot

how to better communicate with the counties in the state. and the members and we didn't send our notification out soon enough so now we know we had to do that and we are able to accelerate the process and make the payment before the end of june so we ended up only being a week later than normal. but we assured the counties at that point and the secretary was very engaged as well that we would do earlier notifications and we would just try very hard not to have a delay and we would stick to that early june date. >> great. can we expand on this for me a little bit more in terms of the entitlement acres where counties don't receive payments for some acreage that they currently have. and can you explain some of that inequity for me? >> so we make payments for certain lands, the lands that

are in the forest system and the park system and there are some lands for which we don't make payments and a little sheepish to tell you, i don't specifically know the distinction but dr. corn does. >> under the pilt statute the compensation is explained in the statute. so if there's a category of land, dod or whatever that is not specified in the statute, it will not receive compensation. so if there's a category let's say of forest service land that does not get compensation under the pilt statute then it won't. it's not discretionary with the department of interior. >> okay. and i guess the question that i have and it goes back to a little bit to mr. yok's comments and if i could maybe get you to comment. cross-purposes is very important for me, for my family, for our

entire community and we've had restrictions in terms of being able to get in and harvest timber as an example, access to the minerals to be able to provide resources back into your communities. we see the pilt fully funded. i did just a couple of sketches if we go back to the very beginning it looks like it's been underfunded to the tune of 1.5 billion since its inception in generic round numbers, are some of the restrictions that we're going to be voting on going to further impact our ability to make payments that's going to be able to provide for schools, provide for public safety in the building of highways in your estimation? >> do you mean under pilt? >> yes. >> the factors that would relate to that is any effect in the prior year payments. in other words, to the extent that you reduce the prior year payment or increase the prior year payment you may -- and you'll remember i had a very

complex formula up there for this calculation but you may reduce a given county's pilt comment or you may increase it. and it's difficult to tell what the net effect would be. >> talking about that and i'm about to run out of time here, but just in your estimation where we've got counties -- hensdale county, 90% federal lands in my district, a very small population but they receive less but if our friends from new york come out to their public lands and drive off the end of the road, they want to have public services there to be able to provide those services. in your estimation is that fair to have that part of the calculation population or should it be strictly on the side? >> as you know, it's difficult for crs to deal with that sort of question. let me just say that this is not discretionary was the pilt statute. in other words, they receive whatever the statute calls for. >> i was just going to ask for a comment in terms of fairness. i understand. thank you, mr. chairman. i yield back.

>> thank you, thank you. a hypothetical, unfortunately, it's for us a reality. >> thank you. ms. hays, there have been some discussions that the formula for pilt payments result in some inequities. some units of local governments that are already fairly well off receive large pilt payments while some with very limited resources do not receive as much from the pilt program, does the department have any suggestions on how the program might be reformed so that we more fairly allocate the funding? >> that's a great question. i anticipated you'd ask me that. and struggled with what i would say. i hesitate to suggest anything. the formula was so extensively discussed while they were putting the act together many years ago. and i've gone back and looked at all of that and there were so many different options they looked at before they settled on

what they enacted so i really don't have a better way to build that mousetrap. >> the other question the department of interior shares receipts from resource development activities on public lands with the units of local government. can you give us some examples of where various programs that have revenue sharing? >> i sure can. many of our revenue sharing programs share the receipts with states as opposed to going to directly to the counties. but their formulas are very diverse across all of the programs so, for example, mineral revenue payments for mineral production we share 2 billion a year with the states. there's also the -- let me think what else we have. of course, there's offshore

which has nothing to do with pilt grazing revenues so there's a number of them. >> and those would be a significant transfer of funds, would it not? >> it is a significant transfer of funds on an annual basis where we're sharing about 8 billion a year. >> thank you. ms. corn, according to crs data, how are the amount of funding authorized for the pill program actually appropriated between 1976 and 1994? >> congressman, between -- the first payment was made in 1977. so between then and 1994, the range was between 100% down to

in 197988%. all of the rest of them were over 90%, generally over 94%. even then in the early years it's difficult to figure out 100% payment to fit in was that the baseline data was refused. or how much they'd gotten in the previous year. >> and be the same comparison if you would for 2008 to the current year? >> between -- wait, 2008, did you say? >> yes. >> that's 100%. >> and it appears there was a period from 1995 to 2007 when the amounts appropriated to the program fell short of the authorized levels? >> that's true. >> i will not ask you which party was in the majority from 1995 to 2006.

i'll leave that for people to figure it out. let me -- if i could, professor, one question, in your written estimate you suggested an analysis of opportunity costs of that would be useful in evaluating the merits of federal land ownership, in other words, we should estimate what is being lost because of a coal mine or a uranium mine. would an analysis of these opportunity costs, as you see it deduct the potential costs for mitigation, cleanup of any waste or pollution that was caused as the -- associated with these products? would the deduction be fair as part of the opportunity scale? >> absolutely. a good measure of opportunity costs would have to take into account the costs both of production and then post-production timeline. but, again, it should be something that's appropriately

included and estimated. >> my time up. >> thank you. mr. mcclintock? >> dr. yonk, how much of the state of nevada, for example, is owned by the federal government? do you have figures on that? >> sure, if i were sitting in my office i would say it's well into the 90%. >> how about of california, my home state? >> i do not know the answer of california. >> i represent the northeast corner and we do have counties of which the federal government owns 70 to 80% of the land area, which stuns me when we reflect on the fact that washington, dc, the federal district of columbia with all of its government buildings, the national malls, all of the memorials and parks -- the federal government owns about 25% of the land area of the federal district of columbia, what happened?

how was it that the federal government seized the vast proportions of the united states away from the local people? >> that's quite a question. the short answer is that you had a period where you had divestment occurring in the united states, where you had land holdings that were held by the federal government that were being in large measure privatized and that era ended prior to the introduction of the pilt program that it was no longer interested in doing those sorts of things and so it was sort of a default setting as we came out of the homestead era what do you do with the balance of the land? well, that land was held by in most cases the federal government and was not fully allocated. >> well, what we have found in the northeastern corner of california is the federal government is a lousy landlord and an even worse neighbor. we're watching these federal agencies shutting down community

events that had been exercised in these communities in some cases for generations, driving grazing operations out to forcing people to abandon cabins that had been in their families for generations. it really is a lousy neighbor. what do we do about all of it? not only are they consuming vast proportions of land that would otherwise be going for productive use, but they are -- have become an active impediment to simple commerce and activity in these mountain communities. >> i think the short answer to your question is that's a fundamentally political question that's left in your capable hands. but there needs to be a recognition that the costs are real to these communities. and it's far too often that those costs are discounted or even suggested that the results are positive. that you should be grateful to have increased levels of production because you'll see increased tourism dollars.

our work does not bear out that's consistently the case. >> the recommends pointed out that there have been years when the federal government has been unwilling or unable to match the current authorization for pilt which is very low and, of course, as we all know the federal cupboard is bear. we're actually borrowing that money and i'm not sure how much more china is going to loan us. shouldn't pilt be funded by selling these excess federal land owns and shouldn't we set a 25% limit on the amount of a land area of any state or locality the -- certainly any state the federal government can own considering the fact that it does just fine owing just 25% of the land area of the federal district of columbia? >> again, i think that's a fernly political question that this body will have to decide.

there is real costs and as they expand there are increasing costs. >> if we were selling this excess land it seems to me two things would happen. if we were using that to fund pilt they would have a source of these communities without tapping a treasury that is deeply in debt and at the same time would begin reducing the problem by restoring the land of productive local holdings. >> i think one of the interesting things in response to that is pilt is not solution to these public lands counties. i mean, we've heard testimony today that it's typically been funded at over 90%. and, yet, public lands counties still lag behind their nonpublic lands counterparts in a variety of measures. and so i think the more fundamental question that you're asking is an interesting policy question. should we be divesting public

land. >> so there is a solution in that it creates jobs throughout these regions, would create additional tax revenues throughout these regions because of productive activity and would still leave the federal government holding far more of the land area of the states than it does of its own federal district of columbia. thank you. >> the short answer, if i may -- >> 5 seconds. >> maybe that would happen. >> you did that in less than 5, good job. >> thank you. thank you, chairman bishop, for holding this important briefing. i would also like to think the witnesses for testifying, giving this community the information on these on the program as a member of colorado, a member from colorado, i understand how vital the pilt program is to my district.

it's a colorado from western states douglas county in my district is slotted to receive nearly $300,000 of pilt payments. mr. yonk, right now we have a continued budgetary problem on the federal level but there's a significant level for pilt funding on the local level. so how can the department of interior increase flexibility for the local communities to extract more dollars from their land and, therefore, become less reliant on federal pilt dollars? >> again, i refer to part of my written testimony that as you increase the levels of protection, particularly, as it expands beyond simple federal ownership and many of these pilt counties have large areas that are protected at some level greater than the standard just ownership, and when that occurs, we see increased costs of people's communities and one of the potential avenues would be to reduce some of those levels

of protection that could potentially have a positive outcome on the context and there's a lot of potentials in that statement because estimating what would happen gets to be very difficult and it becomes dependent on what resources actually are available on which public land. >> thank you, mr. yonk. ms. corn, you testified that the addition of indian lands to the pilt program is the current issue of debate but my question is, how the addition of these lands will affect the decision to continue the five-year mandatory authorization in the future? and how will this sedition affect local communities' ability to earn revenue from these lands and become less reliant on pilt funding? >> congressman, this was an issue that was brought up extensively in 1994 in the

hearings that were held in the senate. the biggest difficulty that i recall was that defining indian lands all by itself was a monumental task. there were multiple categories, reservation lands, trust lands that may or may not be on a reservation allotment, land holdings that were once owned by other entities and acquired so it was practically impossible they felt at the time to determine exactly what should be included. that was the big stumbling block. in some counties, i don't recall where, but some counties the holdings by a federally recognized tribe on a reservation are a very substantial fraction of that county's land and since they are not taxable then the burden of the -- the tax burden falls that much more heavily in terms of

property taxes on the nonreservation land and some counties have complained this is a very severe burden. having said that, the reservation lands do sometimes receive important county services such as fire protection, emergency services and so on. it could vary quite a lot from one county to another. >> thank you. i yield back. >> do you have any questions? >> i do. mr. chairman, i ask permission to have included in the record a letter from ms. tommy martin, board of supervisors from arizona. and because of the staggering amount of federal land, supervisor martin reports property owners now shoulder over 90% of the county's burden. >> no objection. it will be added to the record. >> professor yonk i'm curious to hear your views that's affecting my district. district 1 is roughly federal lands and we know how the pilt is calculated. it's it is eligible lands times

by a dollar amount received. and this actually is a substitute of the property taxes and so here's my questions. let me ask you does pilt support local counties when local disasters caused by mismanagement of county federal lands like forest fires require the firefighters and county responders. >> one of the things we do see in public lands counties is that their budgets would compare them to public land counties would spend more on public safety and the various things that you're describing than their nonpublic lands counterpart. although it would appear there's at least a public land in the county. >> so do you know if they compensate for natural disasters. they're inherently take, for example, they have a big wildfire here. this is the biggest fire in arizona history.

it's directly related to our fire service and there's no way to compensate for that. >> it's difficult to answer that question because pilt in my estimation in what we founded, it does not cover the day-to-day operations. it's not a full replacement of property tax revenue in every case and so based on that logic the answer to that county it's based on any basis or study. >> but it's asking a requirement, the federal government is asking that they do maintain these on a daily basis but not compensated on a daily basis, is that not true? >> that's correct. >> so i know that my counterpart brought up that compensation mechanism, you know, the minerals, ms. haze, is it not true that those minimals allocation is dealt by the state

constitution in their allocation. >> i don't know by the state constitution. >> i do. let's go back to arizona just so the record states are those monies for compensation for mineral royalties goes to the land department which goes strictly to education, nothing else, nothing more? so let me ask you another question, mrs. corn, is there any way in a procedural way the counties have the ability or states have the ability to either increase or decrease the numbers of lands in regards to compensation for pilt? >> oh, because that provision is defined in statute. in other words, the eligibility of a federal landholding to receive a pilt payment is defined in statute so any change in the county would require a change in the statute. >> so we'd have to do it here? >> yes. barring -- let me just say with one exception, if some lands were to be acquired, let's say, to fill in an in holding in a

national forest then that would become federal land and would be eligible for the pilt payment if the status of the land is fixed in statute. in other words, the types of lands are fixed in a statute. >> you brought up another question in the definition of indian lands let's say, for example, that a tribe buys a piece of property that is considered part of their holdings, does it then become part of pilt, does it then become a nonpilt? >> in effect you're suggesting that the tribe has acquired some type of federal holding and it has changed from federal land that was eligible for pilt into land that is now part of the reservation. i haven't heard of that happening. i'm afraid i can't answer that. i don't know -- >> the reason i ask that, you know, we spent the better part

of 100 years trying to get criminal law with native tribes than us fairly similar and it's fairly similar but we've yet to touch federal actions and that's why i've got a number of big tribes and tribes in my district and we have an example of this possibly occurring and so what we have to do is look at the ramifications because i have some of those holdings where a big tribe has the lock on the land ownership within the county but still drives a lot of those maintenance and there's no way they can actually compensate or maintain. there's just no way. navajo county is an example. what they do is heroic. all the emergency responders and law enforcement is just wonderful what they do in response to the federal government so i yield back my time. >> thank you. more questions have come to my mind as i've been listening to the discussion here. so ms. haze, let me start with you if i could. i first want to say it was

troubling very troubling to hear your answer to one of the questions that the department -- you don't know if the department will be requesting full funding for pilt in the 2013 budget year proposal. i understand that may be a pay grade different than yours to make a statement with that decision but it is troubling where the department is not determined to do that and is willing to publicly say they're determined to do that. can i ask about the payment schedule, though? is there statutorily a date certain when pilt payments must go out the door? >> yes. the statutory requirement is they need to go out of the door before the end of the fiscal year, the federal fiscal year. >> so there's a cutoff date. there's not a date that it has to be done? >> correct. >> will the department of interior then this year in pilt payments, will they be made to the county before that date? >> they will. >> i appreciate you being --

that one is definitive. can you tell me what the specific reason was when y'all announced the delay in the 2010 payment. >> we had received some additional -- some information from a state about the -- that impacted of the payments to the counties and it had to do the way dr. corn as to the pass-through money and it was a new procedure that they had put into the state. the state assembly had passed new legislation and so a set -- a set of prior year deductions we would have ordinarily considered in the formula. >> so this is a accounting problem within the department of interior? >> i think i'm understanding your question but if not, ask me again. it was a delay in trying to

understand what happened in the state and get legal clarification around whether we should deduct those payments or not. so it was a legal interpretation what the new process -- >> if there's a statute that tells you you have to make a payment by this date, uh-huh, then why did you tell the states you may break that statute in order to do the internal calculations? >> there's a statute that requires that we make the payment by the end of the fiscal year, september 30th. we tried to make the payment early june. we had gotten initial information in from the state later than we normal ask for. we normally get the information in from the states in december. we didn't get it till later in the spring and then we had additional clarification discussions with that state that went on for a while. >> thank you, i appreciate that. i think it would probably be helpful for the counties if there was a specific date on which they can depend, not when it has to be done as an end date but a specific date on which

those payments had to be going out at that time and i realize there is not a statute that demands that particular thing. i'm also understand the impression and correct me if i'm wrong, the department of interior does not have the ability to increase or add categories of land or to adjust valuations of lands statutorily. that has to be done in a legislative change within the basic -- within the basic program itself statutorily. the department of interior does not have am i right the flexibility to change classifications land categories, ceiling payments, population payments those types of things? >> correct as dr. corn explained there's a set definition for which lands are subject and get payments and lands that do not. >> thank you. >> let me turn to dr. corn if i could for a few questions. are there county payments that are not against future pilt counties for some but not others? >> pilt provides for --

>> actually, doctor, i'm going to run out of time before i get through you with all of these. i'll come up with that one later on what counties get and what counties don't. you want another set of questions in each round? >> i'm not that nice if you'd like. >> thank you. i appreciate it. let me ask you a follow-up question. i believe the wildfire was the result of a lightening strike. had that land been all private, who would bear the cost of fighting that fire?

>> so the designation of that monument has had little or no effect on the economy's of canaan garfield? >> that's what the data in our study has led us to. >> thank you. it's a relief to have that resolved once and for all. and with that they yield back. >> thank you good mr. tipton, jeepney questions? >> thank you, mr. chairman. i have just one more. we have so many public lands throughout the west who are

economically depressed in the fortunate right now we've got other than double-digit unemployment in many of our chinese. going off of some of your analysis, i'd like to be able to actually see the report. if lands are further designated to become or restrict it, do you see further negative economic impact? and hearing testimony. i just have a public hearing on one of my communities and one of the contentions is that were able to actually see positive economic impact office and designation. do you seem to be indicating to the contrary. and if you see more restrictive designate a hunter and designation, we understand not all regulations go away as honest as forest service lands, though the protections that will be in place. if it gets more restrict its come is there more negative economic impact? >> in response to that, the

notion that there is a positive effect, and none of our studies how we found a consistent positive effect of increasing designation. we do find a few designate wilderness areas, a greater negative effect on those communities. as we go beyond that, it becomes less clear. the monument study of the grand staircase is not that it's a positive. we can find no effect. the claims are that the effect would be this great food to those counties to recreation dollars. so it's a little bit of a mixed bag to answer your question. there are currently cost as you restrict the use of land. >> great. >> ms. haze from what you like to comment on that? theophany studies? >> now come i'm not prepared to do economic study comments. >> to sierra's have anything? >> nothing that i'm aware of. thank you. i yield back, mr. chairman. >> .your corn, can i start on

this one here? what it was trying to ask is whether county payments that are not counted against future payments in some counties, but are another counties? >> yes. where states have laws that require a pastor, in other words this is a feature where states made my the payments resulting from blm must go straight to this entirely separate entity, a school board, for example does not go to the county government. in that case, that payment -- let's say $10,000 would not be counted as having gone to the county government. so it would not be deducted for the following year's payment. >> at me give you another hypothetical along that line. different issue. so we've established some counties will be treated differently according to those pastors. so for example unsecured school

payments, i always did that and from the previous payments? >> next a hearing on extending -- >> is not going to be uniform and not counties for example, let's talk about onc counties in the west. secure payments will go there. but they also tell payments as well? >> in the case, the school's permission does apply. in other words if were talking about national forest lands, they were prior payment or secure rural schools from the following year's payment. on the other hand the land in question is an onc county is chosen hear rural schools, that payment under secure rural skills would not be deducted from the following years payment. bear in mind that this is an

incredibly complicated problem simply because some of the counties will be limited by the population ceiling so it would make any difference anyway. or some of the counties may be receiving a minimum 33 cents per acre payment. so it still wouldn't make any difference. but potentially, there would be a distinction between onc lands -- >> could bni appreciate you saying the 33-cent figure. i don't know -- usually to a nasa question within a dancer. i've no clue what the answer is. when that dollar figure was established, why was there a specific reason for me shakes that we used? we talked about how the formula cosette nisan the amount of land and a certain dollar figure attached to it. with a major piece to come up with that figure? >> in the original law, the dollar figures are 75 cents per acre and 10 cents per acre. >> wide? >> i just tried to edit

recently. i looked at the hearing records in the house and senate. i haven't looked at florida yet, but that number just pops out. and in the house report, it says that instead of choosing and that lists various options, would the committee select 75 cents per acre? >> attributes to throw out to charge a tax levy based on nonstandard, there'd be getting significantly more money from the federal government than they look at because they have this arbitrary numbers that are there? >> is on the super nines sunday at significantly less. >> okay. >> yes, that's possible. >> in the online and can't envision that scenario, but it's theoretically possible. can i ask another question the history of the? i know population is included as the figure. historically wide? >> the reason that the time for

including population was that they did not want to give counties that had very large population resources. in other words in the west the counties tend to be really big geographically and some of them may think of sacramento for instance a big counties, ferris publicly and it must have substantial population. in contrast to the counties with the amount of public land, but a very small populations. the county had the very small population needed proportionally more assistant then presumably more resourceful if that's the word i want townie like sacramento. that was where that started. >> once again, it is likely made an appropriate decision, but it's a fairly subjective decision. >> demerit figures for the actual county and ceiling

numbers i have not found a specific justification and shortly after the parallel is passed in 1978, there was a study by the council intergovernmental relations, which asserted that can back up to 75 figure, that there was -- and i merely quoting no fiscal reason that they could determine for having chosen that number. >> thank you. i didn't know the answer to that. have to admit it's a troubling answer, but it's a good answer. if i could after a couple questions. to squander this kid in the written testimony can you give us some insight that was interesting and the idea of transfer was tied to a change in the attitude we had about public lands in the first place. would you want more time just reinforce what you said that. >> so the logic was that there is a change happening disorientation towards a

publicly instrument to do an increasing federal oversight of what was occurring on this federal lands. and so, part of what pilt was deciding me to do, especially those that have advocated strongly for it was to prevent the systematic disadvantaging of those counties large public land holdings based on this change in this new focus on conservation of that sort of time that we might term environmentalism today. it was designed with the recognition that they would be cost to these areas with exchange. >> so you've given us another avenue of attacking this problem if we look outside the box in some way. are you familiar with that letter economics in their analysis on the impact of national monuments? >> ibm. >> can you tell me what conclusions do you think unchecked different so starkly? >> the analysis uses a growth model where we take -- were they taken timely with the value of some specific measure was, compare it against time be,

holding constant the dollars -- they use 2009 and they create this -- there's been an increase. that's great, but it's possible the increases have been everywhere. approach says -- to suggest that we look at it by controlling for what the other fat tours are and comparing it against the counties that were most like the counties where a monument was designated and in our case brandon keane. at the time the designation happened we want to see what happens in the intervening years. and so it's simple to look in a there are in fact larger household and times in 20 alas and then there were i think it's 1995. the household incomes are larger, but there's no clear discussion about why you would see the increase and the assumption made in the implication that is made in that report has been taken from it is

a national monument that has led to that. our work fine no evidence that is the case. >> the winner and there when he said there's no impact, but you say in practical terms is to risk are not talking to that destination, dropping money on the streets as they went there. >> correct. >> but in your study though, did you include economic opportunities that were lost by those designations? >> no. in this case there's two primary reasons. the main opportunity cost has been identified in the grand staircase has gone through monument is the intellect fine. we have serious questions about whether that mind would've been operative operative in that. based on the regulatory environment. so an estimation of what the effect would be, we felt was inappropriate primarily because we have serious doubts about whether or not it would've been open today. some day it would've been open

perhaps, but the regulatory environment is a whole another discussion would likely have prevented it. >> let me finish up with three questions and then i'll let you go. to what extent the transfer payments reimburse counties blessed with wilderness or monument designations? >> at some level less than the cost of those designations. >> states like my city i've try to do project to stay fans, especially school trust lands. to evaluate the economic and assistant state on lands as opposed to similarly federally owned land? >> we do encourage a control for the pseudomonas because you want to make sure were not inappropriately ascribing the impact of the plan, but we have not been a full-scale study of what the syntax would be. >> do you have an assumption of what you would find out? if i had an assumption of what you would find out, would that be fair? nevermind, that's my real

question. one last one i would like to do. after a blast tearing and i just take a quick reaction to you, there was a survey -- a study done by an interest group that was published in one of lake papers said basically people are loving the grand staircase monument. i wanted to read what the question was to you. and the question that was given was the grand staircase protects public lands between price and b.'s in southern utah. a national monument allows for continued public user creates in her creation, but admits new elements. do you think the grand staircase is good or bad for utah? in their survey, they ask one person who lived in garfield county, one person who lived in king county, one in wayne, nobody in pi ute and then went five miles by car duenas 132 in salt lake city.

what kind of validity which you gave to the survey sample? >> without the methodology, the question is purely both vague and provides direction to the answer. we just recently completed a survey of rat and internet protection in utah and one of our primary concerns was if we simply draw a random sample in utah, we are going to get a large majority from different counties of salt lake, davis and weaver. if that the only people we asked, we can identify with the results of the survey will be. they will infect him a solid access to high-speed internet. so we had to use a different sampling methodology to ensure that she got geographic representation in the sample. and so, that would be our approach to dealing with those potential problems. >> i appreciate that very much except those counties from a

district. they are good people. i want to thank the witnesses who have been here to give their testimony and thank the members who have shown up to ask questions. i want to make public the hearing record will be open to receive responses if anyone here wants to add to their testimony or if we send you the other responses. i think sometimes for me i found this very illuminating. this case, it would be helpful if there is some specific deadlines or dates on when those checks need to be going out and i appreciate your answers to the reason for the delay that was announced at one time. dr. korn come a per-share historical and thank the gentleman why 70 was paid sometime good for you. i would actually appreciate the data. they appreciate you being here and i appreciate the studies you've had economy impacts the impacts these plants impacts these plants have and the people who live in those areas in 19 inaccurate testimony. with that come the subcommittee hearing is adjourned.

[inaudible conversations] >> because i am a businessman of which infinitely i was formerly connected with a large company, the opposition have attempted t? picture me as the liberalism, but i was a liberal before many of those and i thought for theç9

reforms at the altar republican theodore roosevelt and woodrow wilson before another roosevelt atop dead and distorted the world liberal. >> next, reported by 2010 deepwater horizon gulf of mexico oil spill. the findings are put together by the u.s. coast guard and the bureau of ocean energy management. representatives from bp coming, transocean and halliburton testified. the house national resources committee is three hours and 15

minutes. >> the committee will come to order. the chairman notes the presence of a quorum, which under rule three is we've exceeded that. the committee on natural resources meeting today to hear testimony on an oversight hearing on ballmer u.s. coast guard joint investigative team report. under rule four ascot opening statements are limited to the chairman and the ranking member. however, i ask unanimous consent that any member that wishes to have a statement in the record added to the committee before the end of business today without objections the worker. i'm now recognized myself for five minutes. first of all, i wanted to thank all of the witnesses for being here today. although i was greatly frustrated by the events that

lead to the delay and repeated scheduling of this hearing, i am pleased that today will hear testimony from the investigative cochairs who conducted an oversight extensive interviews, depositions and document review. this committee will also hear from three com and is named in the report. the primary purpose for originally scheduled this hearing was to hear directly from the actual falcon investigators about their official working from findings. as the committee responsible for overseeing agent these are energy production, it is our duty to get the full facts regarding the deepwater horizon explosion in oil spill in finding of the report. at her very first hearing this year, this committee heard testimony from the cochairs of the president don't commission that he selected and he appointed and it's only logical to get the same attention to this official report. i said from day one that we need

all the facts and information regarding this bill before rushing to judge or to legislate. this report is an important piece of the puzzle that kid says deeper insight and clarity of what caused the explosion that tragically took 11 lives and led to an oil spill that caused widespread impacts throughout the gulf. the gip investigation is unique and important in many ways. while there have been several investigations and reports issued, this is the only investigation team that has subpoena power. this is the only investigative team comprised of technical engineers and experts in this is the only investigative team that actually examined the blowout preventer. members of his investigative team on the ground from day one and have the necessary tools to complete a thorough and comprehensive investigation. they had access to information that others didn't and it's important for this committee to hear directly from them on the report in their conclusions. in short, this report finds the

disaster was a direct result of multiple human errors that go failures. other report makes a number of recommendations if interest you to know it includes no specific recommendation for congressional action. i've repeatedly stated that the top priority of this committee is to make sure drilling the safe east in the world. over the past 18 months, there've been significant changes and reforms to improve up sure drilling and respond. it's important that congress, the administration and the industry continue to respond appropriately. i stress reforms must be done thoroughly and downright. we have no other choice than the stakes are this high. offshore drilling must be done safely, but we cannot afford to make it impossible through overregulation. yesterday this committee heard from people and businesses in the polls who continue to suffer one year after the obama

frustration lifted the official moratorium in the gulf of mexico. their livelihoods are linked to u.s. energy production and for that matter, so is our nation. our national economy, american jobs and our national security dependent upon the safe and reliable u.s. energy production. we must therefore to foster energy production and eighth days, timely and efficient manner. i look forward to hearing from eyewitnesses in learning more about the months of on the ground work for the jit investigators. america owes both of you entertained their appreciation or your service to our nation. with that, i recognize the distinguished ranking member. >> thank you, mr. chairman. >> more than one year has passed since the peace are not well finally stop spewing oil into the gulf of mexico. the congress has not enact a single legislative reform in response to the worst environmental disaster in american history.

in what has been the reason for this delay? the republican majority is blocked to legislative action because they said they wanted to wait until all the facts wherein before taking action to respond to this though. well, we have now heard from the independent vp phil commission. we've seen the forensic examination of the blowout preventer and the governments joint investigation team has now issued its findings and recommendations. the facts iran and it is well past time for this committee and this congress to enact comprehensive legislation to ensure that we prevent a similar disaster in the future. the government's investigation reached many of the same conclusions as the independent vp phil commission. the report says this disaster was preventable, not inevitable. this is the corners were cut. that decisions made and stronger

safety standards and more emphasis on worker training could have held prevent this disaster. today, we have before us a government investigators who look long and hard into this disaster. we will see it from representatives of the oil companies respond we will see you from representatives of the oil companies respond. while it is good that this committee is companies respond. while it is good that this committee is finally hearing from him that the companies involved in this disaster, i feel compelled to note that the minority was not notified that these additional witnesses would testify until very late on tuesday. less than two days before this hearing. the testimony of the oil company representatives was not made available until yesterday a new. i am worried the effect of the process could be to show these companies from scrutiny or hamper ability of members and staff to fully review and analyze the come this testimony. it's also prevent democrats from being able to exercise rights

to, nobody witnesses. for this reason, a majority of democratic numbers that the committee had signed a letter to you, mr. chairman, exercising rights pursuant to rule that the of the house to car would is to testify at a second day of hearings on the subject. however, regardless of how we arrived here today, there will be many questions that this hearing. and after today, we should have the answers we need to finally move forward with comprehensive reform. it is time to hold these companies fully accountable for this bill. in fact, late yesterday the interior department officially issued seven violations of other regulations against bp and for peace against halliburton and transocean. unfortunately, even in a worst-case scenario for bp, these violations that resulted in the nearly five and arrows of oil spilling into the gulf would cost the company a total of

$21 million. not dillion, millions. considering what we know about what caused this disaster, bp should stand for bigger penalties. bp is on pace to make more than 25 william messier. 21 million represents a little over seven hours of profits for this oil giant. @obviously does not begin to approach the amount needed to be a deterrent against the repeat of this tragedy. that finest that the more than a slap on the wrist. the transocean company has already announced that it plans to appeal the fine and the fans once again transocean is trying to transfer blame. we need to ensure that there are sufficient financial incentives in place to deter oil companies from cutting corners. we need to enact legislation to increase civil penalties for companies who violate federal regulations and increase the

liability cap oil companies responsible for his bill. at the democratic spiller responds bill would do, we need to hold these companies responsible for their actions and to ensure that the agent these here today are working to implement the safety reforms recommended by the joint chief investigation team. after this year in the hope republican majority will and their push to revert to the same speed over safety mentality that led to this disaster. joined democrats in pushing for real reforms to protect the economy and the environment of the cold. i yield back the balance. >> i thank the gentleman. before recognized the panel, let me respond. the minority has every right to exercise whatever authority they have to have hearings. i respect that. but i do want to say and i alluded to this in my opening statements. i too am frustrated with how this all came about.

but nevertheless, it is here. we're going to have this hearing and i think hopefully will shed some light on what we're looking at. let me make an observation when the gentleman referred to minority witnesses. this hearing today, there are no majority or minority witnesses. as a matter of fact, the first panel is made up of cochairs of the investigative team and then representatives from the department of interior and also the coast guard. and the second panel is simply made up of those that are referenced in the report. so we don't have a situation as minority witnesses. it simply doesn't exist with this panel. nevertheless, the ranking member have every right to ask for an

additional hearing about certainly take that into the iteration. our first panel today. >> at the gentleman would yield briefly. it is to say that there was no consultative process on the second panel whatsoever. >> reclaiming my time on that, i privately have mentioned to the gentleman if you recall on the floor of the house it was always my intention to have representatives from the companies here. now i know the gentleman has requested ceos. if i had my way every time we have a hearing here and not a member of the administration here, i would like to have the secretary of the interior here. that obviously doesn't work. in fact, it would be even better if you're a president obama here in everyone. so we asked our representatives have become me. they send executives.

they have chosen the one i can best respond to a week -- but we think you need to learn through this hearing. but i do want to say -- this goes back to my original observation. i was very frustrated we had to postpone this for three weeks. by the time we got confirmation of passing the panels here, we need that in a minute. there's nothing more complicated than that. so this isn't ideally as i would have wanted it, but this is the hand we are dealt with. i'd be more than happy to yield. >> i thank the gentleman very much. >> i am trying here to divide the question. and by that, i mean yes we do want representatives from the companies to testify. the point that we are making here is that we were not

notified until 4:00 on tuesday to bed at 10:00 meeting on thursday morning they would be a second panel. we had no idea they would even be a second panel, much less who is going to be testifying. so the issue that we are really raising here is one of the consulted process. we are going to disagree obviously i'm pictures. but in terms that the notice that the minority gets in order to prepare for hearing, in order to make in a timely fashion or even to have a discussion as to whether or not a minority witnesses necessary. was not provided. so that is the point we're making. >> we were just trying to construct something if it makes it easier for the minority to be able to wage their concern in timely fashion. >> reclaiming my time and i appreciate the gentleman's

response. they simply want to send a private conversation, so is my intent to do so and we didn't get confirmation until representatives to be here. i thought this was precisely the right venue if you will investigative report of a tie representatives of the companies they are. i appreciate the gentleman's point and i understand that i was in this place before. at any rate, i thank the gentleman for his remarks. our first panel i am very pleased that all of your here. we have cap 10 bguyen, david said to come a cochair of jit team. we have vice admiral brian salerno for operations at the u.s. coast guard and of course michael bromwich, director of

the enforcement. for those of you who haven't been here, dragged her bromwich knows the rules very well and i know he will not exceed its five minutes because he knows how touchy i am in that regard. but the way the lights were there, you're full statements will appear in the records. so that will be part of the record. i would like you to have your old re/max can find to five minutes. when the green light is found, it means you're doing very well. the meal i can sign it means you have one minute left. on the red light comes on, it means you're five minutes are over. so i'd ask you to try to confine your next event because your false statement will appear in the record. so cat 10, we'll start with you in a recognizer five minutes. welcome to the panel. >> morning, chairman hastings, distinguished members of the committee. i am honored to appear before

you today to discuss the investigation. admittedly following the loss of deepwater rising, the department of homeland security by dhs and department of interior, doi have the investigation for the circumstances surrounding this and to make recommendation to prepare a curse. on april 26, 2010, kaylee cook, direct your infirmary would be designated as the coast guard cochair for the joint investigation. in addition to me, there were three other members formally assigned to the joint investigation team, jit, including captain mark higgins, the atlantic staff advocate, gerard whitley, senior investigation not the third and commander robert. commander jeff gray, headquarters staff judge advocate served as attorney for the jit.

the dhs doi can be in order ordered identified mr. david said to have enforcement boe mr court chair. i think mr. dykes for cooperation and support. the deepwater rising demanded transparency needed to be systematically investigated. consequently come in early may 2010, in collaboration, our investigators developed an initial investigation roadmap, which was posted on the internet website in june 2010. as new issues that concern rights and they come in the road map is updated to include additional public hearing fashions and parties and interests. the closely followed the roadmap. as the year has progressed in a number of parties interesting, the number of objection increase significantly. it was determined that members with a little background would assist the cochair with

objections and enable investigators to focus on tech and commanders a subsequent public hearing session. federal judge and captain mark higgins were added to the jit. the cochairs presided at the hearing, the additional judge in the and captain higgins moved investigation forward. the coast guard investigation focused on factors on board the deepwater rights and that might have contributed to two explosion, fire and subsequent sinking of the vessel. we examine the firefighting evacuation in search and rescue efforts. at the beginning of january january 2011, jit xhosa members begin to conduct our analysis with no access to damage sunken vessel, we relied on witness statements, testimonies and documentary evidence. based on information we identified facts and develop conclusion and recommendations. the finding conclusion and

recommendation of the coast guard investigative team on volume one of the final report come which was released in april april 2011. but the exception of the fight. don't wait eric conclusion, it does not change related recommendation could jit xhosa members stand by conclusions and recommendations. the coast guard were investigation program is a system of checks and balance this. our investigators exercise of judgment and reported thing is appropriate. as reporter investigation is complete chemistry many two headquarters for the final agency action. jit xhosa members participate memorandum. i am pleased to answer your questions. >> thank you very much, captain nguyen. i recognize mr. david dykes, chairman of the jit.

chair misrecognize for five minutes. >> thank you, mr. chairman. members of the committee, for the record my name is james david dykes. my written testimony presented in my oral statement giving here this morning is from my very best recollection of the facts as i know them. in preparing the written testimony, if limited access to evidence due to my resignation from the bureau back in september. it came from web information and a team or my own recollection of the information. my written testimony attempts to address the investigation as it was conduct did. but was discovered during the investigation and with the investigation findings show. on the morning of april 21, 2010, investigator curt telstra, the district manager brain domain and i were in houston when we learned that instead.

upon hearing of the news, we immediately began both the investigation they send the response phase in vps office in houston while other personnel in and mms office in new orleans for brand enough their operations they are. the coast guard was prepared to dispatch investigators to the offshore location to start interviewing surviving crewmembers. we dispatched mms investigators to louisiana to rendezvous with the coast guard investigators and travel to the archer location. investigators in the kid damen bankston is out to the beach and begin conducting interviews and collected statements. within the first three days, mms is coordinating with the coast guard in areas that needed to be explored. i met with coast guard personnel for the mortgage city marine safety office and representatives from republic of marshall islands to determine what information was in hand and what information needed to be collect it.

at this time, preservation orders were issued to bp's entry and ocean. the joint investigation issued more than 90 subpoena and collected over 4000 pages of evidence over the course of this investigation. these documents accomplished everything from company say for active faith and drilling procedures and permits to employee performance reviews and master service agreement. jit held seven public hearings and called over 80 witnesses. some witnesses refuse to testify. however perhaps due in part to the announcement of a criminal investigation by u.s. attorney general eric holder on june 1, 2010. in closing, finance from the investigation revealed that additional barriers are needed to reduce probability of similar events of this magnitude from happening again. recommendations for additional research and regulatory provisions as well as design

revisions along with changes to well control and emergency response will add these barriers. however, they cannot guarantee that the human element in the equation or perform as intended. this specific issue is one issue that will haunt the oil and gas in this tree in every other industry where personnel are required to make decisions based on that data. this concludes my opening statement. i'd be happy to answer any questions. >> thank you very much. i think she recognized vice admiral brent salerno. you're recognized for five minutes. >> at morning, chairman hastings, rick and member murky and distinguished members of the committee. i'm pleased to have the opportunity to answer questions you may have him a comment on faction on volume one at the joint investigation report and loss of the mobile offshore drilling unit or motive deepwater horizon. specifically i'm prepared to discuss steps the coast guard is

taking to improve save tea in the offshore oil industry. i would first like to express on behalf of on behalf of secretary napolitano and the commandant of the coast guard our deepest sympathies to the families of the 11 men who lost their lives in this tragic accident. the coast guard is kept families informed of the investigation's progress and most recently provided with a summary of reactions were taking to improve motor safety. although the sinking of deepwater horizon followed a oil blowout, the investigation revealed numerous system deficient these and acts of omission on the mode to excel that had an adverse impact on the ability to prevent or limit the magnitude of the disaster. these deficiencies included port maintenance of electrical equipment may have ignited the explosion earlier than might otherwise have been the case at the bypassing of hydrocarbon gas alarms and not a manic shutdown system and a lack of training on when and how to shut down

engines and disconnect notice from the well. the coast guard members of the joint investigation team made 65 recommendations -- safety recommendations in administrative recommendations to improve save the onboard buses operating on the outer condado shell. recommendations can be characterized in three broad areas. recommendations related to the effectiveness of domestic, related to enforcement of the standard and administrative recommendations. the commandant cumbers were in power, but the vast majority will propose the safety actions. overall, volume one reveals that regulated safety systems aboard the mode is enabled 115 of the 126 persons on board to survive the explosion and subsequent fire. for example, all survivors were able to evacuate the mode of using the installed base saving equipment with the exception of

approximately six to their own initiative jumped in to break into the water. also come even though significantly damaged by the explosion in the ensuing fire, deepwater horizon have enough structural resiliency to stay afloat for more than 48 hours despite being engulfed in a major fire that was being fed from an uncontrolled fuel source. nevertheless, it is clear from this tragedy the coast guard must refinance procedures and oversight to better fill its responsibility to ensure safety come as security and stewardship on the unicenter cup final shelf. to accomplish this, the coast guard alert both domestically and internationally to improve standards for u.s. and foreign side note is. we've already taken action based on lessons learned from this casualty. for example, we initiated a new policy on risk-based targeting of foreign flagged motives operating on the outer continental shelf. our goal of this policy is to

prioritize their examination activity according to risk, taking into account numbers fact there is including the past performance of the managing company, owner, flag state and recognized organizations delegated authority to act on behalf of the flag state. the intention is to enhance safety for all vessels operating on the u.s. outer cottonwood shells. we're also attaining domestic regulations which govern vessels operating on the outer continental shelf to reflect the lessons learned from the deepwater horizon in the current state of technology. the area contingency planning at first with the offshore spill response plan approved by the bureau safety enforcement to ensure consistency and approved preparedness through the coast guard continues to work through the international maritime organization where among other initiatives we are leading u.s. efforts in support of a mandatory code for recognized

organizations. the code will improve accountability of recognized organizations acting on behalf a flag state and will better ensure that all vessels including notice comply with international standards. thank you i look forward to answering questions. >> thank you, admiral salerno. last finales, director bromwich are recognized for five minutes. >> thank you very much, mr. chairman. a very much appreciate the opportunity to testify about finding that the bomer coast guard joint investigation into cost that the explosion and fire on board the deepwater horizon and the devastating oil spill that followed. i want to note this report validates many important reforms to usher regulation oversight was already implemented, the further underscores the need for government industry to identify and implement practice is to ensure that domestic oil and gas production proceed safely in response "glee." the panel identified the causes

of the poet as well as various failures that occurred prior to the blowout. they concluded essential caused this failure of a cement area of the production casing string, a high-strength steel pipes that any will to ensure well integrity and allow future production. the failure allowed hydrocarbons to flow through the riser and onto the red. the panel finding conclusions and recommendations address a wide range of other tech echo issues. the panel found the loss of life in macondo well were in part the result of poor risk management, last-minute changes to plans, failure to deserve and respond to indicators in both controlled response is insufficient to buy companies and individuals. failure the gop allowed the well to continue to flow after the blowout. the jit found clear and compelling evidence that bps was contract as transocean

halliburton violated regulations and consequences were undeniably tiger. we believe issuing citations for such regulatory violations uphold the principles of accountability, specific deterrence in vindicating boomers regulations. the panel concluded stronger and more comprehensive federal regulations might have reduced likelihood of the macondo blow it in particular recommended regulations could be enhanced with respect to procedures and testing, vop consideration, well integrity testing another drilling operations. in addition to panel concluded the program could be improved. i can report regulatory process changes implicated by this report have been formulated and implemented over the past 15 months. the report concludes that the panel's recommendations which seek to improve safety about churchill in operations in a variety of ways thought out in the report. those recommendations will be carefully considered basis for

future rulemaking. the findings reinforce and build on safety and oversight gaps that had already been identified and significantly improved upon since the outer dress and tragedy. these include killing safety will enter since it will come which i describe to you here on previous occasions. our reform has been broad and swift and safe air. but it is a report there's more to be done. we must continue to analyze information that becomes available and implement reforms necessary to make offshore oil and gas production safer, smarter and stronger protections for workers and the environment. the process of making development the state as a bishop will never be complete. they must be continuing ongoing dynamic enterprise that remains responsive to new learning. as we evaluate lessons learned

from the jit report coming to a test creative solutions. to that end i hope account may so take a hard look at this report as well as other recent investigations to understand what went wrong and think about what they can do to go above and beyond existing requirements, enhance safety and ultimately help us to identify best practices that could be adopted across the industry. thank you very much and i look forward to your question. >> thank you very much. i want to thank all of you for your statements. i'll start the question. my first question probably is more of the reaffirmation to the cochairs, but i just want to ask both of you, captain nguyen and mr. dykes after 17 months in the number of interviews he had an resource is, do think you -- that this investigation does nrp reflect the most accurate account of what happened if the

deepwater wrightson? >> mr. chairman, yes i do. i think the coast guard investigation is the most comprehensive investigation reports out there, especially on the marine related sites. >> mr. dykes. >> mr. chairman, i agree with captain nguyen. based on what we have, it is the most accurate accounting of what to place. unfortunately, we lost 11 individuals in that event. those 11 individuals are key witnesses to what was going on on the floor at the time of the blowout. and we have to put pieces of the puzzle together without those 11 testimonies. but from everything i've seen, we did not leave any. >> you alluded to that in your testimony. i just wanted to reaffirm, sit thank you.

>> director bromwich, in view of the citations that were issued, you have repeatedly asserted that the department has now found new authority under law to not only just regulate the lease holders, but also the contract curse to the lease holders as well. so i'm not going to comment on whether that's appropriate or not. my question is very specific. what statutory authority to the department have to regulate those subcontract curse to the lease holders? >> thank you for the question, mr. chairman. we've talked about this issue. foxtrot and the related statues to give the secretary of interior authority to regulate offshore operations. and i would revise what you said. we didn't find new authority. the authority has always been there. it's been a history agency to

only go against the operators. when i came on board and had to review issues, when i reviewed was whether it made sense. in the face of the courageous violation might not operators, that is contract. >> i understand that part. my question is specifically bradley said oscar. i want to know specifically. the reason i say that is because it's pretty basic. i'm at a disadvantage. your lawyer. i am not a lawyer. but we write the laws here and that is carried out by the executive branch. and simply asking very specifically what specific part of the law do you have since you haven't regulate it, what specific part do you have is there now? >> i could write you in writing with the specific sections and subsections art. clearly in a regulations code which are based we say we have

the authority to hold jointly and favorably liable all entities, not just operators that do live sure with respect. >> that is specific and allow? >> that specific and regulations. >> @going. i'm talking about the law that gives you -- this is a distinction without a difference. i think it's very, very important. the reason i say that is because we had a discussion another area of interior that has nothing to do with you. i asked director happy with the statutory authority had any since jonah statutory authority. and simply asking the question because i don't often see patterns, but i'm asking specifically, i'm talking about statutory law -- >> could be invalid if they were not eastern statutory authority. >> i can give you the specific citations. just so you know, mr. chairman,

because the agency had not his berkeley exercised its regulatory authority over contract roots, i specifically asked the solicitor sought is, lawyers for the department to make sure it we had the authority. so they research the issue to be double sure they came back and told me we did indeed have that authority. >> a few wedding you offer to give us a written next to nation is specifically which parts of the statute gives that authority, i would like you, if he would come to give that to the committee as soon as possible. how sad -- >> eichinger today because we provided that to senator pittard responds to letter he wrote many months ago. >> we've reviewed that. i'll just simply say when we reviewed that responds to senator pittard, we didn't think that covered all of it. so if you could be more specific in what she did to senator pittard, that would be helpful to us.

>> @. we'll do that. >> timeframe would be the same as today. >> i was offering a letter that authority been written. it would be helpful if it's on that which aspect are not sufficiently detailed. >> the statutory authority. again, i'm not an attorney. another big disadvantage, that i would think, you would say that she would ask people what statutory authority. >> that's in the letter. >> we will look forward to that. and my time has expired. in fact, i've gone over are appeared to recognize the distinguished -- i guess you're pitching or mr. markey. mr. hall. >> thank you, mr. chairman. i think the witnesses. i thank you for your work in this investigation. let me begin with you, admiral salerno. the jit completed the work of

volume one in the case guard part of the investigation in april. there were 50 specific recommendations, 40 of which the coast guard -- the commandant has recently concurred with. is that correct? >> that's correct commissary. >> okay, has the coast guard commenced rulemaking on many of the recommendations clicks >> yes, sir, we have. there is an ongoing project to improve what we call subchapter ran in title 33 cfr come which governs offshore authorities and we are incorporating the recommendations from this report into that ongoing rulemaking process. >> so of these 40 accepted recommendations, how many will be -- will be enforced stay by

the end of the year? i mean, what is the timing on this? wiki. really a drumbeat from this room drove faster, permit faster, move faster, let's do more. i guess i would like to see the sense of urgency that our colleagues are constantly hitting us with applied to your regulatory process. >> pathetic characterize it this way, not all of the recommendations would require regulatory actions. some can be executed as a matter of policy. in fact, we party moved out on that. ..

now on the matter of the country through and you talked about a risk-based targeting that i think might be a suitable approach. right now there are with them, let's see what, about one third of the vessel's operating the

u.s. flag and about two-thirds are from other countries. five from a panel for example the coast guard has identified as the most at risk country. are there were limitations that can be placed on some of these most egregious violators were the weakest enforcers' pending development know of the more complete with rules and regulations the risk based methodology will stimulate -- >> while you are putting that in place should there be limitations placed on some of the clear blue and risky flags one right away.

>> what it does is trigger the coast guard examinations more in-depth examinations when we are on board. that is currently in place. that risk based methodology is operating now and we are building additional information that will further refine the mayor risk model. you are correct panama has been identified as the flag state hadn't that indicates greater risk and we are paying attention with of the panamanian flag. >> what the gentleman yield? >> i have only a few seconds but i would be happy to yield. >> i would work with the gentleman and make sure the gulf of mexico are u.s. flag vessels if we can start to roll back some of the regulations and fabrication yards under and get to the point we can increase productivity and fabrication yards we've wouldn't have to worry but having the foreign

flag vessels to what whoa. >> my time is expired. i look forward to pursuing that. >> we seem to have an agreement here. recognize the gentleman from louisiana. >> thank you mr. chairman. do we have the slide? we had a hearing yesterday and i will preface this statement question being from louisiana we have taken three hits on this disaster. the first was of the death of 11 good people, the tragedy for their families, the second is been the perception the beaches in florida and alabama and mississippi have been harmed to the point when vacationers

stopped coming. a third and more important at this time is the permanent slowdown that mr. brummer jim bunning and mr. landry have had discussions on the and i will give an example what kimmel of the hearing the calls for us it is what is in the process that seems to create this and i've got one graf in front of you talking about permitting activity in the gulf of mexico that prior to the macondo disaster it was taking -- the permits for being approved at a rate of about it looks like 110 per month dropped to 60 and its remained and then if you look at the production it's dropped from where it was before it has 1.8 million barrels a day it looks like it is dropping off to

1.4 barrels a day. the production as well below par and this graph shows you if you look at the red bar when you see is the difference between the reports from the obama administration how long it takes permits to be reviewed and for them to be approved and when you see is the beams of but it is the problem and so the companies are telling us is people are submitting the paperwork which by the way we heard from a witness yesterday going from an average of 30 to 35 pages to 100 times that well over 3,000 pages the forms are not uniform this from one time it may be one way and another time another again

to the allies are not dhaka and devotees are not crossed and it seemed to be dhaka ends up on a desk some place. we're looking at more than 100 days the late getting the permit application process up and going we also understand that the final report came out just last month that yet all of the new bureaucracy and the reforming and occurred prior to that report so i would ask since you are out of the system now and maybe are a little bit of an object of the police and do you feel the deily in permitting all the regulations -- >> would the gentleman yield? i want to say the responsibility was to investigate you are asking him to make a judgment call and i don't think that's quite fair to the people on the

committee. i.e. understand what you are asking i think in this particular case it wouldn't quite be appropriate to asked. >> i thank the chairman. i will ask the question of mr. brown which. do you think that all of this delay and all of the new regulations and the confusion going on in the process do you feel that is justified in the period most of which we didn't have the results of the report? >> first of all the data is badly flawed. >> i will interrupt you every time we give you data you always say that. we would love to have your data. >> the time it takes to review plans and again this chart completes plans and permits, to separate process these plans new list does sometimes taking 100 days, 200 days and so on it's

not true. we had outside consultants take a look at the plan review process for three different periods of time. before macondo, macondo and about a year after that and the most recent period and the facts are that currently it takes an average of from the time a plan as originally submitted until it is deemed submitted incomplete. prix macondo the average was 37 days. in between when there was undeniably disruption in the process the average time was 83 so this is based on outside experts looking at the rall data in our files and all 103 plans submitted during those periods of time one.

>> we've been calling your department and offices to get that the devotee we can't get it. of course we have the incident with mr. landry who couldn't even get in contact with one of your officials couldn't even get a phone number so we hear this in the meetings in the hearings but we can't ever get the information directly from your department in. that doesn't explain why production is going down. we can disagree with your facts even though we don't have yours to compare ours with the publisher hours, you don't the production is clearly going down. nobody seems to dispute that at all. >> we do published hours. i & hearing from you and others it may be confusing to. we are happy to meet with you and members of your stuff and further explain what the data means. >> where is it published today?

it's on your website? every one of my stuff, the natural resource staff tell us that there is little information and certainly nothing that clarify this. >> they may find it confusing but no one can say there's little information. >> the time has expired. i've been lenient on this. i want to make everybody have an opportunity but a understand where the gentleman is going and we would like that information. i recognize the gentleman from oklahoma. >> i want to thank the panelists for being here and the co-chairs for all the fun, all of the work you've put in and i want to plan now director we don't always agree or have the same philosophy when you have worked well with our staff and we do want to thank you. i've got a question and this goes to the captain this is

really troubling to me. as you know one of the tasks of the marine board is to determine whether there is any incompetence, negligence or misconduct on the part of government persons in the deep water horizon we'll still and i got an e-mail and this is from i guess the total was lieutenant commander michael odom, and let me just read this e-mail and this is to randall and i hope i don't butcher the south, anyway, his e-mail basically says i made it to new orleans last night and we are starting the press work for my testimony. if you're interested the questions they will be asking are attached. call me if you need anything. everything is informal and i can't be in the hearing room

until what is my turn so there will be a fair amount of standing around. that right there is extremely troubling, the fact that a government person has already been prepped before hand with the questions are going to be. so my question to you is whether it was this or other government witnesses is it true that you provide government witnesses with information, questions that were going to be asked and coaching with their responses are going to be so is that true and if it is wouldn't you agree it would be hard to make object of the termination of the government witnesses and also another question was did believe to from the people of the energy industry were they provided with questions ahead of time as the

government witnesses were and how do you think that impacts the validity? i would be happy to share any of those e-mails with the committee and fishermen. >> we would like to have those. thank you. spearman in terms of sickness prepping we can sit down with our witnesses and explain to them these are the areas we're going to be exporting and it could be a question we are when to be asking like my understanding is we didn't provide answers to those questions and by understand that is acceptable and if my understanding is correct i am sure the postcard would -- >> of the government witnesses were provided with the answers beforehand why weren't the nongovernment witnesses provided the questions beforehand? the folks from the industry? >> my understanding is the

coastal policies we can propelled witnesses by explaining the areas we are going to go into and have a question we may asked. let me ask real quick the areas. if i come up with this attachment that shows these are the exact questions would that be against coastguard policy? if there is an attachment to this e-mail from mr. obama the last person that attacked it that have the specific questions with the areas to be discussed would that be against coast guard was? >> not providing question we ask that the hearing is according to the policy. we do not provide the answer to the witness or coach them on how to answer. witnesses will be under oath and they definitely do. i do not believe that compromising the integrity of the investigation.

>> i want to thank the captain mr. chairman. this is kind of a troubling development. >> with the gentleman yield? we can work together and dig into the sola but more and maybe from a document standpoint but certainly if you eat the west point to make is to certain questions is general areas something that needs to be pursued and i would be more than happy to work with you on that. >> recognize the jindal and's florida. thank you. i know early in the year we were presented with a president's commission on their findings and today we have obviously the report and learning everything i've learned, the stuff i've gathered on ac recommendations. there were nine, i am sure you read, nine recommendations that

the president's commission made. i'm looking at the report given today, company practices and regulatory agency recommendations. my question to you is along the lines of mr. boren but not to receive any recommendations or appointing all of where the government or any responsibility in not preventing this accident. so therefore i would like you to tell me where the government failed because what i see in the industry and looking at is the government's presence. so i ask you where did the government fail and where are the recommendations that should

follow the recommendation of harm your department in your agency is going to do their best to prevent this from ever occurring again. >> we do our best tall times to make sure nothing like this happens and mr. blight has worked in number of years in addition to helping us to that. the fact is you can never guarantee that an accident like this can't happen, but what you can do is to take regulatory action in the enforcement actions reduce the chances it won't happen again. we have already put in place new rules, new safeguards that address some of the technical issues addressed both in the president's commission report and in dhaka strengthening requirement is a >> where did the government

fail? spec we didn't have sufficient. we strongly have regulations that were both on the prescriptive area and also that said some of the performance based standards to the agency i think historically has not had but now does have -- >> citations to this particular organization, and this particular well. there were areas where they had already been cited, correct? >> they are slated as a result of this report. they've previously -- no, they're hadn't been sightings. specs and your belief is the government did everything. there were instances where basically the government hasn't done its part in getting rid of problems that exist. this wasn't a governmental failure but by the companies

that drill flow will. there are things they can do to strengthening the regulations and increasing its inspections the will help reduce the chances that anything like this will happen again. you can never eliminate that. why it needs to be partnership where as we do our best to improve complot simplify, modified the of its in region will continue to be committed to increasing the safety of sure. >> part of the partnership is recognizing what both parties could do to improve the system going forward and i'm just saying that in all of these reports we've been given and the thousands of hours there is no recognition of her in the partnership. you come claim you ran bid in europe he wore a big part of the industry. obviously to your regulatory presence that there is no

regulation. i found them upon the gulf and it's amazing that none of the changes that an administrator would see necessary to prevent this from happening again our ever presented in any of the papers we get. >> they are in the commission's report and some extent hours reported. islamic fiddled know. none of the nine recommendations in the president's report deal with the agency or changes necessary. so i challenge the statement you just made but i see i'm running out of time so i yield back. >> time from maryland is recognized. >> thank you mr. chairman. i appreciate you all for your testimony. this report is an important piece of the puzzle, and we

ought to pay great mind to it. to speak to the importance of resources for your agency particularly as it responds to the line of questioning you just got. in other words, you a limited to the fact that where the government might have fallen down on. i remembered as having hearings in the early days this disaster where we got statistics about the number of production facilities and platforms and others that individual inspectors were responsible. a small number of inspectors to cover the tremendous number of

these facilities and so i wanted to give you the opportunity to speak how important it is the resources be there in the capacity of tour agency and the oversight function and performance and any proposals that relate to how the industry can help fund that inspection and oversight. >> thank you very much. obviously resources are critical and i've spoken here and elsewhere many times that over the 28 years of its existence this agency has been starved. for example, the number of inspectors shortly after deepwater horizon we had approximately 58 inspectors covering just in the gulf of mexico more than 3,000 facilities, and when you compare it to the resources, inspectors

compared to facilities in some of the other countries with substantial offshore activity like the u.k., like norway it's laughable how inadequate the resources, it wouldn't be if she were not so serious so we appreciate the request for additional resources. the converse efforts to fund at least some of those but we are nowhere near where we need to be in terms of the resources we need. we need to high year scores of additional inspectors and bolster the hour regulatory program so we can address the sort of issues the congressman was talking about but do it in a way that's collaborative with the industry that puts in place regulations that make sense and that are more performance based than our historical perspective to the two prescriptive

regulations so we are trying to get the agency with the congress's help on the starvation diet that it's been on for 28 years and has dramatically in heated and impaired its ability to do the job all of us want it to do. >> i appreciate that and i hope the majority appreciates it as well because in their appropriations bill where they paid the budget is significantly under where it needed to be i think to the tune of $35 million as against your original request so with those resources will be there. i also wanted to ask you to restate what i thought were very impressive statistics from a moment ago about how you handled the turnaround time for the issue of these permits and you even have noted the you got the time down to a lesser number

than even existed before the horizon tragedy which is a tribute to the agency. it's not something i think the average person this is really appreciates and i wanted to give you the chance to brief you that one more time. >> it's very troubling and disappearing when the dhaka disappointing to me what i think our urban legends about the time it takes to review permits and to get recirculated and circulated again. we have made a huge number of efforts to work together in the industry and the gulf to clarify what's required in the planned submissions to clarify what is required in the permit submissions. we had workshops both on plans and permits which have been extraordinarily well attended by industries were we've taken every effort possible to answer the questions that operators in the gulf had.

they think best for the clarification is we've provided and i think that's part of the reason that the processing times have been reduced. i heard mr. fleming say that some of the plans packages are 3600 pages long. i gather that was something said in a hearing. we heard that had been said and looked back the longest submission we could find was only a tenth of that. so i don't know where these stories come from, but they are not true. >> thank you. i would like to thank the panel for appearing and i am not going to ask you about planning or permitting today i hope to have you back many more times to do so. in any event as they understand this is great to be directed as i sort of step back and jump up to the 50,000-foot level it looks to me like this accident

occurred because of three principal reasons one is you had a series of planning and design errors and you had safety systems that didn't function as designed or they weren't operating correctly and then lastly you have human error and response problems. this is a philosophical question for you most of us believe we can address safety regulations and safety system design and operations. would you each conquer with that? >> i would concur with that but the critical aspect is what you talked about last is the human error aspect. >> you can address the first two problems i think with regulatory oversight; is that correct?

>> yes, sir in the coast guard and the regulation we have equipment standards and operation standards however on the human elements we also have licensing of mariners in terms of training and licensing. >> training capabilities? said that goes back to the question how do you -- and this isn't meant to be a gotcha question because i'm going to ask the next panel the same thing. how do you a rest of the human error problem. you say when a pilot makes a series of errors and we crash an airplane how do you address the human error problem? can you do what only through regulations? what else does it take to get there? >> philosophically from the standpoint to reduce the number of human errors you have to reduce the number of interactions where you need that individual to make the decision to weight if you can reduce the

probability by reducing that number that's the first step where you come through administrative controls or engineering and remove that aspect of the job. the second half is where you cannot engineer out or put a administrative controls in place to remove the individual from the equations and you have to factor him in. the key to this awareness, knowledge, training, education and getting that individual of the information he needs in a format that he can understand it, by just eight and make a decision based on what he knows. when my question was do you think the industry got the message because if you don't think we fix this part of the equation we will have not this accident again but another of some sort because it's

impossible in the legislative ways human error said do you think the industry has learned in your perspective they got the message? >> i would hope so. i can't speak for an industry at that point. for my report standpoint i hope they did get the message. >> do you have any evidence that they haven't affirmatively to take care of that. >> i have no indication that would nullify the haven't gotten that. >> of the equations and the report we talked with the safety not only we saw that the discrepancy on multiple locations and the corporate office so i don't think the government regulation can. i have another individual and i think that when i went out to

visit -- >> i think you answered i'm going to reclaim my time. the coast guard has jurisdiction in the u.s. borders, right? >> that is correct. >> and then i forgot my last question. sorry, this was an obligation that you don't have sufficient legislative authority to issue the regulations to address the causes occur and is that delegation correct? we heard the young minority say this conversation, we've talked on a number of occasions the certainly lead to all kind of legislation including raising the several finance would be helpful and this incident underlies that with fishermen about the importance and desirability of having organics

to support. the agencies we have in force like specific safety related issues they don't flow, they do not flow specifically from this report read >> that's what i thought so you have the ability -- the regulations that you've written -- >> i guess i'm trying to say there is not sufficient -- we need for legislation it seems to be the specific issues our agency deals with in terms of regulating the industry. we do think we have the power that we need to respect the time is expired and i recognize the gentleman for five minutes. specs before principal. the u.s. coast guard identified transocean and deepwater horizon. they are part accomplice in the blowout that led to the disastrous oil spill. what regulatory changes to you

think would present the sort of negligence that's going back on the human error issue from happening in the future. how did the u.s. coast guard ensure the study was. >> there are a number of things. some are designed related to the systems in place as was just discussed and some are human elements. one of the most significant aspects of this case is the tool command structure and the confusion that created as to who had authority in an emergency, and as far as the actual conduct i think that mr. salerno can be part of that. i was not part of that investigation. >> director, the same question,

how did your agency assure that the study was conducted in a manner and then if you will because we went through this already and sometimes you have to put a historical context into the conversation. is the agency that you head has some significant reform and restructuring, has received initially supported for there to be able to his job and in response to what was government lack of oversight and they will deal with the cozy industry regulatory relationship that existed and that should be part of the context we talked about. you can talk about where the agency was and where it is now and i think that's important. the objective man you have it where the agency is now compare

where it used to be and not only have the different name. we have split into different component parts to eliminate some of the mission conflicts that have six exhort. we worked extremely house to the to 15 months to get that reorganization right and that went final as i think you know on october 1. so we now have a revenue entity that is in a different line of reporting within the department of interior and the recent split is the resource management and the safety ander get free agency not only did we do the reorganization and splitting up the agency but we have based on the many refuse investigation of the agency. taking a hard look at ourselves and some of the weaknesses identified including the alleged coziness with industry over time and we are in an ongoing way

looking to reform many of the ways we do business. that is in midstream and that is a process that needs to continue a significant period of time it relates to enforcement and investigations and regulations, a whole raft of things. you have my commitment the dow will continue. in terms of investigation which i can certainly speak to that, but the investigations, the designation of witnesses were handled by the investigative team alone. with the exception of the 11 witnesses the tragic deaths they were not able to interview and in his words they left no stone unturned and gathered the information was relevant. i know of no reason that is not accurate. spec i ask the preference and

thanks the team for the report and study very much appreciate it. i believe it was objective without question. the last posing for you. an interesting process where the government is at fault for what happened. we don't ask any of them are going to felipe the panel at the new year's coming. what can we ask you, but a fraud had to roll and there is constructive steps to ensure and that's how i see it and i would just ask for your response to that. >> and fink largely because of the resources we have been passage in the past and are looking to change that it >> thank you. >> the time of the gentleman has expired. mr. harris. >> thank you. i will yield to the gentleman from louisiana. >> i thank the gentleman from maryland and people joining as

well. mr. .. to clear up the couple things with the chairman in the morning which is i had some concern on the authorities you have for think you have to reach into in the conduct oversight of the contractors. >> have a stash of resuscitation for you. >> i have some of the letter that the response the you told the german would give that information and i don't see the citation in their. >> it's section 24 be which is codify that 43 united states code section 350, subsection be which authorizes the assessment of civil penalties against any person who failed to comply with the terms of the least permit regulation etc, and we have been

advised by the solicitor general's office is of this person is sent to what these operators so that is the foundation. >> and just want to grab some time i will stipulate and i know you are a very prolific lawyer, litigator however i have to 50.146 who is responsible for fulfilling these obligations and i tell you when you are not the sole leader you are responsible etc and within that -- >> there's nothing in here that defines the contractors or subcontractors and when you go batt as i did in my review the coast specifically defines the lisieux and not in any way different contractors and subcontractors. >> did you say this was a definition issue?

>> looking over the specific in defining who those people are rethinking would agree to that. i'm sure you've used it several times as you've litigated cases. also in the senator vitter's request that he made he asked for the legal analysis by the interior department unjustified expansion of current regulatory authorities and we will go back and looked at that particular pop but that's the part i looked at and i don't think that it gives you the authority. it's under the regulations to promulgate with the chairman what he asks for is where you get to the authority to issue that type of regulation. so that comes from oxford?

>> would you repeat precisely -- >> section 24 be which is codify it in the united states code title iii. section 31350. >> mr. chairman i would like to yield the balance. he has a couple questions to fit - up. >> thank you to the gentleman from louisiana. this question is for mr. dikes. was the impact of the attorney general's announcement he was going to pursue a criminal investigation in terms of getting to the bottom of this investigation? >> i believe it may have forced some of the key witnesses not to testify and for example, one of the bp engineers testified

during the second hearing that was the week of march 24th, sorry, may 24th and the announcement of the investigation came out june 30 we wanted to call mark back for further interviews and he refused to testify. >> do you think the report with a follow-up recommendations or the regulation regulatory changes that followed the recommendations is there a loss of fidelity because the fact the attorney general holder issued the criminal investigation announcement? >> no sir, i do not. >> thank you. i yield that. >> the time has expired. the next gentleman recognizes mr. landry. >> real quick i also would like to state will continue to hear

about resources needed a but as i do the math in the increase the budget has had since 2009 we had 116 million sometimes hard for me to count all the zeros of from 2,921. from 2010 to 2011 he went from 225. just real quickly have you utilize those resources to hire everyone you could possibly higher today? >> if we had more resources we could hire more. >> so you tired of everyone you can possibly higher today? >> we've put of announcements as we get the additional funding and we didn't get it until april when the resolution passed we didn't know how much we would get we would put the full press on to higher the categories of the people we need including inspectors, drilling engineers and so forth so we made every

effort as we could to bring people on board as we could given that the resources the congress provided. >> so you for - everyone? >> we fired everyone we have the money to hire we haven't hired everyone we need, not even close >> mr. chairman, please let me know if i am out of bounds here. but under the guidelines and the regulations that once the 13 had the time of the action, do you believe that they were sufficient in order to prevent the accident? in other words and this goes to what mr. sutherland were saying, did it hit the of the of the under the regulations currently in place to help prevent this

type of accident? >> that's more philosophical question from that standpoint. when we look to the regulations on the book and compare them to the yvette we found nothing that would have prevented it and it's hard to forecast as you put regulations on the book and forecast what you're trying to prevent. >> here's the problem i have. i got a call from one gentleman, he went to work in 1973 with a second grade education and a son who went to a 11th grade and one got a eg and they got leadoff, it flies in the face of what we hear today with permitting process these and the gulf of mexico.

we've never looked for a job since 1973 would put got leadoff this week. those three members brought home over half a million dollars combined. good jobs. when trying to understand as i read through what you've had is that this is human error. we didn't need -- was there a systemic problem in the industry based upon your findings cracks >> the investigation wasn't appointed to look at the industry as a whole. >> do you believe there was a systemic problem? putative what of investigation. captain? >> we only investigated the dessel cavity so why did not. >> you are making a judgment call. i'm trying it be done a lot of work. it looked over a lot of

evidence, and of course mr. dykes has been working for mms for 17 plus years -- 12 years so he would have seen a lot. i can't tell you how much i appreciate this witness and i'm trying to understand because we have a political report the president wanted us to take legislative action on it we have a scientific and fact-finding report contrary to the political report and a half people unemployed in my district and it a director saying we are increasing permitting and everything is pointed to the fact the problem that we have is politics and that's what i'm trying to get the bottom line. it's the only reason for the question. >> the gentleman would yield that something this committee will have to come to our own conclusions. you asked me to see if your question was out of line or not

and perhaps it may have been to the co-chair but if they have an opinion obviously we welcome that. but i think -- i have some concerns too. >> i withdraw. >> the time of the gentleman has expired and you are recognized. >> director bromwich, the department issued violations to bp, transocean and halliburton for violating federal regulations in place at the time of this bill. bp was cited for seven infractions, halliburton and transocean, for violations. leave the monetary policies associated with the violations which led to the worst environmental disaster in american history would amount to only $21 million for bp and 12 million for however to mant transocean.

do you think that is a financial deterrent to the oil companies so we you do not have a repeat of the disaster or should congress pass legislation to increase the penalties for oil companies of violating the law. that's the proposal i've made along with mr. holt said the penalties match the actual events that spoiled our environment. mr. bromwich? >> i don't think the current penalty authorization is a deterrent. i don't even think it is close, mr. markey. in an industry where it costs between $500,000 a million dollars a day for a rig the kind of put your talking about is trivial so their needs to be a

significant increase of resisted in the past putting a dollar figure on but it needs to be well into the six figures to be a significant deterrent for individual companies and provide a general deterrence for the industry as a whole. >> so you are saying that you start with 100,000 per incident per day at in minimum. but you think that congress should consider raising them much higher. >> to the oil companies pay a price when people die, when businesses are crushed, the environment is despoiled. is that what you are saying. director bromwich, the government has the authority to suspend all or the companies that commit fraud or violate federal law from you see in the contracts with entering into

agreements with the government. the department of interior has the lease sales, suspension and environment has a different purpose than civil penalties. it is not intended to punish but to protect the government, and the american people felt unlawful and unethical companies. companies can't be suspended or toward for the violations of the statutory produce three requirements, fraud, criminal or civil judgments against them and a lack of business integrity of business on st. the office of management and budget guidance describes the purpose of the dead were meant for them on procurement programs. the states to protect the public interest. the federal government insures the integrity of the federal programs by conducting business only with responsible persons. the first bolt sale for december

should the department consider suspension of the environment of bp from the sales to give us time to assess whether bp has made the changes to protect the public interest. >> we are not going to suspend or the bar them from the sale. we have considered and thought about this issue quite a lot, and we don't think it is appropriate in these circumstances. i do want to remind mr. markey that bp has taken on itself the obligations to abide by additional voluntary requirements. over and above what our regulations require. i think that has been the approach dealing with my agencies since i've been there and also given the historical record of sure, mr. dykes is knowledgeable about it we don't think spending more to di barring them this time. the reason i am raising these

issues it's not just the gulf of mexico. it's everywhere. when you pass a statute against some crime it's not just to protect people from occurred every it is the same people creating the same kind of things so we are not limiting this. we are looking in terms of everyone anywhere in what might have the same people out there thinking that they got away with it. so i feel we should take another look at it whether or not bp should be allowed to participate i think in my mind it is still an open question that should be dealt with as part of this entire process. mr. chairman i think he. >> the time of the gentleman has expired. mr. thompson. >> thanks to the panelists for

testifying today. my question is for the co-chairs command just a clarification regarding a specific piece of equipment, the riser disconnect. it seems to played a key role in the incident. on the day of the disaster which agency was responsible for the inspection of the fraser disconnect with the deepwater horizon? >> that would fall under the department of interior management services. >> very good. was the disconnect properly respected? >> if the information we have all of the inspection documents indicate it had been inspected. >> so, what happened? >> as the report indicates we believe the second explosion that occurred on the rig near

the rig floor to count all of the control plans to the stack, and by this time when the plant got into the compression such that as it goes through the sequencing the disconnect will not function until it completed the sequencing of the closure. >> thanks for the clarification and i yield back. >> we have had requests for several members at least my sight for a second round to honor that so we will begin the second round and again with dr. fleming. >> thank you mr. chairman. viewed for the slide back and the and we talked with the directors be a moment ago -- and director bromwich has a moment ago. i'm happy to come back at any time as i have many times in the past dhaka the plans and

permits. but don't think it's fair to mr. dykes or mr. salerno to go through issues that are exclusively maudine. >> mr. chairman for clarification that's all i'm asking. >> i'm going to allow the heads in the line of questioning earlier and we had the, you know, the hearing before, and i know sometimes we overlap, but there is an overriding issue certainly i've heard it, i know you have come a director bromwich, if people on the gulf coast. so i think it's appropriate this time because it does all tied together. i recognize the gentleman from louisiana. >> we may come to some agreement here after all. is it coming up? you are not able to bring it up? okay. it's the bar graph that i issued before. you indicated, and i what is

badly flawed and misleading. estimate it comes from the gulf economic survival team. do you know where they got that? >> it's part of -- we talked about this last time i was here, congressman, that is from the report that was issued over the summer and as i told you last time -- >> let me correct you before you go further. if it comes from your website we actually got -- they extracted this from your web site and the reason there is confusion, i think you used that word, is because it's hard to find. we had to go through and search. i got three different screen shots, and if i had this graph i would show you in bar graph one it was extracted from your data. >> let me be clear congressman. are you saying that specific

paragraph appears on our data. >> okay. >> it's created from your data. and you say the best logo, from that window it says received eight, 2010, and then it says being submitted, march 31st over 6 months. the staff instructs me we have to go to another part of your website. the point is with a this is simply take your data and put it together in a graph. >> that's not what they did and i am happy to go through this perfectly in detail. it is not what they did. >> until proven otherwise i have to assume that is true. the outside n