testing and bug reading and absorbing when public education is about helping all so you have to look at what he actually did about education and not what he says he did about education. >> host: who is against him? >> guest: it's still early and there is no secret that my union and i, we've always been very big hillary clinton fans. we worked very hard for her in 2008 she was my senator in new york state but you've got to just wait to see -- good afternoon. the market committee concluded its last meeting of the year earlier today and indicated in the policy statement they reaffirmed their view that the

current target range for the federal funds rate remains appropriate. the committee also updated the federal funds rate indicating that the committee judges are beginning to normalize the stance of the monetary policy. this new language does not represent a change in the policy intentions and it is fully consistent with our previous guidance which stated that it will likely be appropriate to maintain the current target reach for the federal funds rate for a considerable time after for the purchase program. but with that program having ended in october and the economy continuing to make progress towards our objectives the committee judged that some modifications are appropriate at

this time. i will have more to say about the policy decisions in a moment but first let me review recent economic developments in the outlook. in the labor market, progress continues towards the objective of maximum employment. the pace of job growth has been strong recently with gains averaging nearly 280,000 per month over the past three months. over the past 12 months, job gains averaged nearly 280,000 per month. the unemployment rate was 8.5% to november, three tenths slower than the latest available at the time of the september fomc meeting. broad measures of labor market utilization have showed similar improvement and with the labor force versus the patient to the

-- participation down as noted in the statement, underutilization's continue to diminish. even so there is room for further improvement with too many people who want the jobs being able to come unable to find them into too many people working part-time that would prefer full-time and too many who've given up searching for a job that would likely do so if the labor market were stronger. the committee continues to see sufficient underlining strength in the economy to support ongoing improvement in the labor market. real gdp looks to increase in the third quarter reflecting solid consumption and investment spending. smoothing through the quarterly ups and downs earlier this year, the real gdp expanded around 2.5% over the four quarters ending in the third quarter.

and the available indicators suggest economic growth is running at roughly the pace in the current quarter. the committee continues to expect a moderate pace of growth going forward. and inflation has continued in inflation has continued to run below the 2% objective and the recent sizable decline in the oil prices will likely hold down overall inflation in the near term. but it's the effect of these oil price declines and other transitory factors dissipate into resource utilization continues to rise the committee expects inflation to move gradually back towards its objectives. in making this forecast, the committee is mindful of the recent declines in market-based measures of inflation compensation. at this point of the committee views these movements as likely to prove transitory and

survey-based measures of longer-term inflation expectations have remained stable. that said, developments in this area obviously bear close watching. this outlook is reflected in the individual economic projection submitted in conjunction with this meeting by the participants as always each participant's projections are conditioned on his or her own view of appropriate monetary policy. the central tendency of the rate projections is slightly lower than the september projections and it now stands at 5.2 to 5.3% at the end of next year in line with its estimated long-run normal level. committee participants generally see the unemployment rate is declining a little further over the course of 2016 and 2017.

the central tendency for the gdp growth was 2.3 to 2.4% for 2014 up a bit from the september projections. over the next three years the projections for the real gdp growth run somewhat above the estimates of the longer run normal growth. finally, although fomc participants project the near-term to the lower on account of the decline in energy prices, they continue to see an inflation moving gradually back towards 2%. the central tendency of the projections is 1.0 to 1.6% next year rising to 1.8 to 2% in 2017. as i noted earlier, the committee reaffirmed its view that the current zero to one quarter% target range for the federal funds rate remains

appropriate. regarding forward guidance for the federal funds rate can our october statement indicated that it likely would be appropriate to maintain the current target reach for the federal funds rate for considerable time following the end of the asset purchase program especially if it is the projected inflation continuing to run below the committees to percent longer run goal. today's statement which indicates the committee judges that it can be patient and beginning to normalize the stance of the monetary policy does not signify any change in the committee's policy intentions as set forth in its recent statements. as before the judgment is based on the committee's assessment of the realized and expected progress towards its objectives of maximum employment and 2%

inflation. an assessment that is based on the wide reach of information including the political market conditions and indicators of inflation pressures and expectations in the reading on financial development. given that the committee is not white as we update the guidance? the reason is that with the asset purchase program having been down in october it seemed it was helpful to continue to communicate the best possible timing for a first the first rate increase with reference to an event that is resorting and passed. instead we have shifted to the language which reflects the committee's focus on the economic conditions that would make the list of appropriate. and when it is rising at a healthy rate and the u.s.

economy is strengthening reflecting in part to the highly accommodative stance of monetary policy. of course inflation has been running somewhat below the goal of 2%, but we projected that is too close gradually over time. as progress in achieving maximum employment and 2% inflation continues at some point it will become appropriate to begin reducing policy accommodation. but based on its current outlook, the committee judges that it can be patient in doing so. in particular the committee considers it unlikely to begin the normalization process for at least the next couple of meetings. this assessment of course is completely data dependent. if incoming information indicates faster progress

towards the committee's employment and inflation objectives, then the committee now expects increases in the target range for the federal funds rate are likely to occur sooner than are currently anticipated. conversely if the progress is slower than expected cut in increases in the target range are likely to occur later than perfectly anticipated. once we begin to remove the policy policy accommodations come it continues to be the committee's assessment that even after employment and inflation are near the mandate consistent levels, economic conditions may for some time or around keeping the target federal funds rate below the levels the committees use as normal in the longer run. this guidance is consistent with the past for appropriate policy given by the participants. assuming that the economy

evolves in line with the participant expectations, almost all participants belief that it won't be appropriate to begin raising the target range for the federal funds rate in 2015. there were reviews on the appropriate timing of liftoff within a year in part reflecting differences in the participant expectations for how the economy will default. by the time of liftoff, participants expect to see further decline in the unemployment rate and additional improvement in the labor market conditions. they also expect the installations to be running near current levels but being reasonably confident in their expectations that inflation will move back towards the 2% long-run inflation objective

over time. of course as i previously emphasized, the timing of the initial rise in the federal funds target as well as the paths to the target thereafter are contingent on economic conditions. by late 2016 the median projection to the federal funds rate at 2.5% remains more than a percentage point below the longer run value of the three and three quarters% or so projected by most participants. even though the central tendency of the unemployment rate by that time is slightly below its estimated long-run value and the tendency for inflation inflation is closer towards the 2% objective. fomc participants provide a number of explanations to the federal funds rate running below its normal level at that time.

in particular the residual effects of the financial crisis which are likely to continue to constrain household spending and constrain the credit availability for some time. but as the factors dissipate further most participants expect the federal fund rate to move close to its longer run level by the end of 2017. finally, the committee will continue its policy of reinvesting proceeds from maturing treasury securities and principal payments from holdings of agency debt. the committee is sizable holdings of longer-term securities should help maintain the accommodative financial conditions and promote further progress towards objectives of maximum employment and inflation of 2%. thank you and i will be happy to take your questions.

>> a number of projected in the lead up to this meeting that was likely the timing for liftoff was around the middle of next year. i wonder if you could clarify that. you said in your statement that it's not for at least two meetings. the forecast seems to be consistent with something like the middle of the year left off. can you speak to that and can you also speak to that which we are seeing now in particular the market-based inflation expectations and whether that gives the committee any hesitancy in the months ahead? i did didn't say the statements the committee can be patient

should be interpreted as meaning that it is unlikely to begin the normalization process for at least the next couple of meetings. now that it wasn't point to any time at which normalization is going to begin. there are a range of views on the committee and it will be dependent on how incoming data bears on the progress the economy is making. first i want to emphasize that no meeting is completely off the table and sends that if we do see see test progress towards our objectives then it possible the process of the normalization would be sooner than we anticipated and of course the converse is also true.

so at this point we think that it's unlikely that it would be appropriate that we would see conditions for at least the next couple of meetings that would make it appropriate for us to decide on the normalization and a member of the participants indicated that in their view the conditions could be appropriate by the middle of next year but there is no preset time and there are a range interviews as of views as to when the appropriate conditions will likely fall into place. so, something that we will be watching closely as the year unfolds. you asked also i think about inflation and as i mentioned in a press statement, especially with the downward pressures on inflation that we expect to see for a little while because of

declining oil prices and import prices we certainly expect headline inflation to be under downward pressure for a while. and as i mentioned most participants do envision the conditions will be appropriate during this coming year to begin normalizing the policy and they do largely expect that inflation will be running close to its current level in the headline inflation could even be lower. but they would want to have a feeling of reasonable confidence that when we start the process of normalizing policy that it will be moving up over time, and of course, if the labor market conditions continue to improve, history suggests that as long as

inflation expectations remain well anchored that that is likely to occur. >> associated press. given what's happened there seems to be a pattern that the market expects good news to come when you have a press conference and good news to come when you don't have one. is that a good expectation and is there any thought to have a press conference at every meeting? >> i would like to encourage that expectation. every meeting that we have is a live meeting that could make a policy decision and we go feel free to do so so i would

discourage the expectation that policy moves can only occur when there's there is a scheduled press conference and we have long had in place the ability to hold a press conference or an in person press conference and we did do so on a number of occasions in earlier years. so, the committee clearly wants to be all to explain its reasoning for normalizing the policies. every meeting is live and if we were to decide in a meeting to begin to normalize the policy i expect that we would hold a press conference call.

at the low oil prices and lower yields around the world is one of deflation and the risk was one that should overshadow the return on the other side. >> we are very attentive to the global development and certainly to discuss them in a meeting. the very substantial decline that we have seen in oil prices is one of the most important developments shaping the global outlook. it will have different effects in different regions and could have effects on financial markets as we are seeing. i think the judgment of the committee is that from the standpoint of the united states and the u.s. outlook that decline that we have seen in the oil prices is likely to be on the positive.

it's something that's certainly good for families and households and it is putting more money in their pockets having to spend less on gas and energy. so in that sense it's like a tax cut to boost their spending power. the united states remains although the production of oil has increased dramatically we still remain the importer of oil. of course there may be some offset in the form of reduced the drilling activity and possibly some change, some reduction in the plans in the drilling area. but on the balance i would see these developments as a positive or the standpoint of the u.s. economy. with respect to deflation, we

see downward pressure on the headline inflation from climbing energy prices and we certainly recognize that that is going to be pushing down headline inflation. and it may even spell over to some extant to the core inflation. but at this point also be indicated that we we indicated that we are monitoring inflation developments carefully. we see these developments as transitory. and the committee continues to believe especially in the improvement that we are seeing in the labor market which we expect to continue that inflation will move back up towards the project of overtime. as i indicated, we will want to feel -- i believe that people will expect to deal reasonably confident about that when the process of normalization begins, but we do expect them to be transitory.

they pay the market to raise the interest rates and the race but you've indicated in your thought. the market misunderstanding. >> that is difficult for me to say. what i want to say is our objective is to communicate as clearly as we possibly can about our plans and how we see the economic environment unfolding. when the participants in the committee fill out the projections, they are asked proo give the federal funds rate and the various economic variables that they consider most likely they are not asked to talk about all the different things that could happen recognizing there is uncertainty and the funding

rate that they would consider appropriate if those other alternatives were to happen. but other alternatives i think our priced into the market and one reason that they may be different than the committees is because they place the ability on other outcomes that looked different than what they regard as the model forecast. they may also have a different expectations about how the economic outlook and how it is likely to unfold. so can i recognize that there are significant differences. i cannot tell you exactly what they are due to come up with what i do want to do is communicate as clearly as i can and have reset the fundraiser over time.

>> [inaudible] >> there are a number of different factors that are bearing on the path of market interest rates. i think including the global economic developments. it is often the case that when the oil prices moved down and the dollar appreciates, that it tends to put downward pressure on inflation compensation and on the longer-term rates and the flows that may be affecting longer-term treasury yields a. they trade to articulate as we can.

>> i was hoping you could go into more detail even though you see it as transitory what you have more room to keep rates low in the next few months and if the prices bounce back what is that going to do to the ability to change rates to react to that? >> i would say i think that's that what we have seen since the mid-80s is that in the environment where the inflation expectations are anchored at the movements in oil and commodity prices and import prices tend to have transitory effects on the inflation outlook. there were many years in which we had unanticipated increases in oil prices really beginning in 2004, 2005 that put upward pressure on headline inflation

and even spelled through into the core. it typically the committee looked through those impacts in the view that they would be transitory. i think that is the committee's expectation here. installation has been running below the objective and the movements in oil are now down and will move inflation around the certainly headline inflation. but the committee finds those to this to be transitory. so, as long as the participants feel confident that the information projection is one that we expect to meet over time

i think they will be looking at things as we decide on the path for the funds. >> does a couple mean to and when you talk about the expectations can you elaborate about what it would take to give reasonable confidence that the inflation is headed back to%? >> the dictionary says a couple means to. with respect to the forecast for inflation and the inflation expectation of me start by saying it's important that the monetary policy the forward-looking. the labs in the paula -- policy monetary and health is at how does that the federal funding rate looking into the future,

the series are important and that are consistent with historical evidence will be something that governs the thinking of many people around the table. typically, we have seen as long as inflation expectations are well anchored that as the leader market recovers we will gradually see upward pressure on both prices and the inflation will tend to move back towards the 2% again historically as it diminishes it does tend to gradually rise over time and as long as i just speaking for myself, i will be looking for

evidence that i think strengthens my confidence in matt view and looking at the full range -- the rage path would be after you make the first. >> so i think you raised a very important point because although there is a great deal is if it be the timing of liftoff and what matters in thinking about the stance of the policy is with the entire path of interest

rates will look like. i really don't have much for you other than to say they will be dated and that the stance of policy will be adjusted to try to keep the economy on track where we see the continuing progress towards achieving the goal of the maximum employment and price stability. the total fund rate has been sitting in this range now for six years. ..

but i can't tell you specifically, other than saying it will depend on progress and it will be data dependent. i can't say much more than that. >> the committee's projection shall unemployment running below your own view than were full employment should be for the next several years. does that reflect a desire on the part of the committee economy run somewhat above potential for a while? if so can you elaborate on what purpose it achieves? related to the question earlier

come you called measures of expectation, but this decline is been pronounced in the five year forward range. we're talking the expectations that inflation many years you will be the low target if the market participants see that as evidence of declining credibility in the committees long-term perspective. why do you still view that as -- >> so, your first question is why is it that the committee sees unemployment as declining slightly below its estimate of the longer run natural rate. and i think in part of the reason for that is that inflation is running below our objective, and the committee wants to see inflation move back toward our objective overtime, and a short period of a very

slight undershoot of under -- unemployment under the natural rate will facilitate slightly faster return of inflation to our objective. it is, i should say, a very small undershoot in a situation where there is great uncertainty about exactly what constitutes maximum employment or a longer run normal rate of unemployment. we also do see the different measures of slack in the labor market, points to different assessments of just what maximum employment is. the standard unemployment rate for quite some time now has been signaling a little bit less slack in the labor market than measures that are somewhat

broader, for example, include the unusually large number of people who are part-time employed but would prefer full-time jobs. and the portion of the decline we've seen in the labor force participation that looks like it would disappear in, or be eroded in a stronger economy, and so it may be that with a very small undershoot of this longer run normal level of the unemployment rate is measured by the standard unemployment rate, we'll be seeing some further progress on those of the margins of slack. but it's important to point out that the committee is not anticipating an overshoot of its 2% inflation objective. [inaudible] >> what i would say, we refer to

this in the statement as inflation compensation rather than inflation expectations. the gap between the nominal yields on 10 year treasuries, for example, and tips have declined, that's inflation compensation and five year, five year forward as you said have also declined. that could reflect a change in inflation expectations, but it could also reflect changes in assessment of inflation risks, the risk premium that's necessary to compensate for inflation that might especially had fallen at the probabilities attached to very high inflation have come down. and it can also reflect liquidity effects in markets and, for example, it's sometimes the case that when your risk of

flight to safety, that flight tends to be concentrated in nominal treasuries and could also serve to compress that spread. so i think the jury is out about exactly how to interpret that downward move in inflation compensation, and we indicated that we are monitoring inflation developments carefully. >> madam chair, bloomberg television. want to follow up if i could on firming going forward on the normalization once liftoff takes place. i know you said it will be data dependent. does that suggest to markets to those watching that the measured pace we've seen in the previous tightening cycle, those quarter-point increments, that's not something markets should expect? what's your own take what about how effective that measured pace was back in the previous tightening cycle? follow-ups are put on the descent of this meeting, 3-d sense of notable number.

what does that's just about the debate around the table in your ability to forge consensus going forward? are you disappointed a number of the descent? >> so let me start with the number of dissents. there is a wide range of opinion in the committee. i think it's appropriate for people to be able to express their views, and in the sense you see dissents on both sides, i think the statement, does a good job of reflecting what the majority of the committee thinks is appropriate policy. so you know, at a time like this where we are making consequential decisions, i think it's reasonable to see divergents is of opinion. just remind me, what was the other -- measured pace. there certainly has been no

decision on the part of the committee to move at a measured pace, or to use language like that. i ain't quite a few people looking back on -- i think quite a few people looking back on that language, i can member devotes 12 or 16 meetings with over 25 basis point moves, would probably not like to repeat a sequence in which there was a measured pace in 25 basis point moves at every meeting. so i certainly don't want to encourage you to think that there will be a repeat of that. many members of the committee participants have said that they think policy should be based on the actual evolution of economic activity and inflation which tends to be variable over time, and that's why i said i anticipate it will be data

dependent. we have continued to provide guidance, the same guidance that we have for some time, that says the committee anticipates that even after employment and inflation are near mandate consistent level, that economic conditions me for some time warrants keeping the target funds rate before the levels the committee just as normal in the longer run. i know that's a mouthful but says in effect that the committee believes that the economic conditions that have made recovery difficult were getting beat on them. they are optimistic that those conditions will lift. they see the longer run normal lift interest rates as around 3.75%. so there's no view in the committee that there is the secular stagnation in the sense we won't eventually get back to

pretty historically normal levels of interest rates, but they have said you know, the economy is required to get where it is, a good deal of monetary policy, accommodation. we expect to be able to normalize policy, but until those conditions have lifted that have held back economic activity, monetary policy will need to stay accommodative. so in that sense perhaps that's equivalent to saying that the path of normalization is anticipated to be relatively gradual. but again, the path of rates will depend on how economic conditions actually evolve. that's nothing more than an expectation on the part of the committee. [inaudible]

>> dow jones newswires. enough about rates. would ask you the nuke it. they have been in the news a lot lately. president dudley was invited to congress to testify about conflicts of interest there. you have things like the cigar tapes, abide report and most recent the revelation that former new york fed official was exchanging for information with somewhere golden stacks who was also at new york fed connections. i just wonder, and also there was scant during the crisis regarding the new fed and its purchase of goldman sachs stock. pc then you bed as a blackboard on the fed system because of these regard scandals? have you talked to bill dudley about reforming the image of that particular regional fed? if you think a person that spent 21 years of his career at goldman sachs is in a position to regain public credibility about conflicts of interest? >> well, let me say that i think

it's very important to the federal reserve system to have confidence in the quality of its supervision. and i do have, i have a good deal of confidence in the quality of our supervision program, for the banking organizations we supervise in general, and that also applies to the largest banking organizations. we rely on examiners who were in the field and at the reserve banks to be providing information about what's happening in those organizatio organizations. but that information feeds into a process in which it is not individuals at any single reserve bank, but at the board, it's a board led process, and it involves senior officials at a number of different reserve banks. it's also a multidisciplinary

process that involves not only people from supervision, but those from markets, from economic research, experts who focus on financial stability all come together to evaluate the information that they have, and to assign supervisory ratings and decide on the appropriate program for all of those large institutions. we have strengthened the process of supervision enormously since the crisis, and i feel, i feel a very good sense of confidence in how we are carrying that out. now, it is important to make sure that we have fed into this process all the information that's relevant to making the

right decisions. and when there are individuals who are examiners who may disagree with others in their team about how to interpret what's going on at a particular institution, it's important that there be channels by which they can make sure that disagreements are fed up to the highest level. this is true throughout the work we do. we did economic forecasting, and the fomc receives information to help us make decisions. but obviously there is disagreements about, among economists about how to interpret developments. it's also important for us there to make sure we understand alternative views. so this is important in supervision. we've announced that the board has undertaken a review of whether or not there are appropriate mechanisms in place

in all of the reserve banks that individuals who disagree with decisions can make their own views known and feet into the process. and we've also asked our inspector general to look into that. >> "bloomberg news." i would also like to get off monetary policy and ask you about the federal research relationship with congress. specifically, how worried are you about legislation that has been proposed and may be proposed again in the next congress that would reduce fed independence? would you see yourself trying to buy back our would you see yourself trying to go to congress to work with them to do more with transparency or something else to reduce their concerns? without making them lost.

and if there were that sense of the white house would you talked to president about the joint them, or give any confidence that he would veto bills that would reduce independence? thanks. >> so, let me simply say that congress has assigned us important tasks in monetary policy and in other roles that we perform, and the federal reserve is highly focused on attempting to carry out the mandates that congress has given us in the area of monetary policy. to promote maximum employment and price stability, and that's what we are working on. you know, i would say that the ability of the central bank to make the decisions about monetary policy, that h it regas as in the best longer run interest of the economy, free of

a short run political interference, is very important to be effective, conduct of monetary policy, and i think history shows not only in the united states, but around the world that central banks independence of promotes better economic performance. so i do think central bank independence is very important, and and it's important to make sure that we can make the decisions we think are best, free of short run political interference. with respect to monetary policy. we should be accountable, and we are accountable, to congress in explaining what we do. i believe strongly in transparency, and i believe strongly that we should communicate as clearly what we are doing in the rationale for doing it and am a very open to

looking for ways ourselves to improve our recommendations in transparency and working with congress to do that. but i would be very concerned about actions, back in 1978, congress explicitly passed legislation to ensure that there would be no gao audits of monetary policy decision-making, namely policy audits. i certainly hope that will continue and i will try to forcefully make the case for why that's important. spent i cannot speak for the white house in attempted to do that. [inaudible] >> i will stop interest rates and first want to wish you a happy holiday.

>> thank you. >> second want to ask you about the russian economy. did that come up in a meeting in a discussion of global economic developments? as you know there's a lot of concern the drop in oil prices the russian economy could be in some trouble. russia owes a lot of money to u.s. and foreign banks and russian companies. is there any concern about default? any concern about possible contagion? and if so, is the fed taking any steps to prepare for that? thank you. >> well, we certainly did review global economic developments, including developments in the russian economy. clearly, russia has been hit very hard by the decline in oil prices, and the ruble has depreciated enormously in value. and this is posing a series of very difficult economic

conditions in the russian economy. of course, we discussed what the potential spillovers are to the united states, which could occur both through trade and i ninja linkages. but these linkages are actually relatively small. russia accounts for less than 1% of u.s. trade volume, and u.s. banks exposure to russian residents is really quite small in terms of relative to their capital. in terms of the portfolios of u.s. residents, there are russian securities, but they account for a very small share. so i expect that the linkages back the spillovers to the united states, both through trade and financial channels would be small.

europe, of course, is somewhat more exposed to russia, both because rush is an important supplier of oil and natural gas to europe, and the financial linkages are somewhat greater. but in the case of the united states, i see the spillovers relative, it is pretty small, but we are obviously watching that closely. >> also happy holidays. >> thank you. and to you. >> there's a contagion risk from low oil prices that people are talking about in the market. what does it mean to the banks that have lent into the oil patch with a low oil prices? i guess, you know, your warnings about leveraged loans come give

me warnings over the past year about leverage lending. are you worried they have not been heeded? >> so, i mean, there is some commute like that in the united states exposure? we have seen some impacts of lower oil prices on the spreads for high yield bonds where there's exposure to oil companies that may see distress or a decline in their earnings. and we have seen some increase in spreads on high yield bonds more generally. i think for the banking system as a whole, the exposure to oil, i'm not aware of significant

issues there. this is the kind of thing that is part of risk management for banking organizations, and the kind of thing they look at in stress tests. but the movements in oil prices have been very large, and undoubtedly unexpected. in terms of leverage and whether or not leveraged entities could be badly affected by movements in oil prices, leverage in the financial system in general is way down from the levels before the crisis. so it's not a major concern that there delivered into these that would be badly affected by this, but we will have to watch carefully. there have been large and unexpected movements in oil

prices. >> good afternoon, chair yellen. i will go back to interest rates if you don't mind. actually it's a question about balance sheet effect on the over all appropriate level of monetary policy and reaffirming the lead investment policy, the fomc says once again that this will help maintain accommodative financial conditions. in the past it said that the large portfolio securities will exert a downward effect on long-term interest rates. as you look forward to raising short-term rates, to what extent does the fomc need to take into account the sort of residual accommodative effect of maintaining a large balance sheet? >> i agree, and that's why we

stated it, that we typically think of the monetary policy impact of our asset purchases as depending on the stock of assets that we hold on our balance sheet, rather than the flow of purchases. and so we are reminding the public that we continue to hold a large stock of assets. and that is tempting to push it down term premiums and longer-term yields. we made clear when we come or tried to make clear, when we issued our normalization principles and to temper that we intend to use changes in our target for the federal funds rate as the main tool that we will actively use to adjust financial conditions, rather than actively planning to sell

the assets that were put onto our balance sheets sometime after we began raising our targets for short-term interest rates, depending on economic and financial conditions, we are likely to reduce or see three investment and gradually run down the stock of our assets. but our active tool for adjusting monetary, substantial monetary policy, so that it is appropriate to the economic needs of the country. that will be done through adjusting our short-term target range for the federal funds rate. >> i can't believe nobody has a should most important question about what's going on with your

san francisco 49ers, but since i but has already wish you happy holidays. can you talk about housing? a few things are more important to americans and their wealth creation than housing. you in your statement noted it continues to be a drag. mr. dudley was actually relatively upbeat in his forecast. i don't know if that's a cute shirt on the committee. what you think is holding housing back. what can congress do. what can you tell cox in the coming year. the clarification on the deadly question, you didn't mention him by name by calling a supervision. are you pleased with mr. dudley's handling of these events? >> so let me start with that. i have great confidence in president badly. he's done a fine job -- president badly. he's done a fine job of running the new york fed, and i want to be very clear that have great confidence in him. he's distinguished public servant, and he has worked very

hard in the aftermath of the crisis to make sure that the new york fed is doing all that it needs to do to continue to the work that we do both in financial stability and in supervision. and glitzy, the other question you asked was about -- about housing. [inaudible] >> you know, been surprised that housing hasn't recovered more robustly than it has. in part, i think it reflects very tight credit, continuing tight credit conditions for any borrower that doesn't have really pristine credit, you know, credit ratings. and my hope is that that situation will he use over time. in addition, household formation has been very depressed. my expectation is, as the labor

market continues to improve and households feel better about their financial condition, that we will see household formation pick up and somewhat stronger recovery than we've seen thus far in housing. >> okay, thank you. >> wall street responding positively today to the fitness of a stronger u.s. economy. the dow jones initially up some 300 points this afternoon. that after the stock index had pulled back over 5% from its

all-time high last week. usaid subcontractor allan gross returned home today after serving over years in a cuban prison. a picture of allan gross here at a news conference at his attorney's office today. the big story of course, president obama announcing plans to normalize diplomatic relations with cuba and fees economic restrictions on the country but that can as both countries released prisoners including alan gross today's. you can watch the presence announcement along with congressionacongressional reacte statement from alan gross beginning tonight at eight eastern on our companion network c-span. secretary of state john kerry right now holding a news conference with the foreign minister of angola. secretary kerry also making comments at that news conference on the easing of restrictions on the cuban government. you can watch it live now on

c-span. >> here are some of programs you will find this weekend on the c-span networks.

>> next, a house hearing examining military cemetery operations, including expansion to meet the needs of current and future veterans. witnesses include representatives from the veterans affairs and defense

departments, the american battle monuments commission, and that's, at the tragedy assistance program for earlierh survivors. this hearing is one hour 40 minutes. >> good afternoon, everyone. this oversight hearing of theaf, subcommittee on disability assistance and memorial affairs will now come to order. we are here today to examine the issues facing our militaryere veterans cemeteries.e the our goal is to learn more about the operations of the national t arlington national cemetery and the american battle monuments commission over the past year. as well as the organization cemetery on commentary on several focused issues that i will be highlightingas well the momentarily. i will also like to welcom mr. walters as he has stepped ue from, to perform duties as he acting undersecretary of memorial affairs at the undet÷

retirement of undersecretary moral. we look forward to hearing about his vision for overseeing therwo honorable mission at the ncaa. mr. hallinan, secretary cleland, it's also nice to have you as well.clevelan it is als the endeavors of these entities are among the most honorable and government and the people with these organizations work day in and day out to honor veterans and service members with the dignified burials. and to assist families and loveç ves who must deal with a loss and tremendous grief.e membs to i've said before, our nation's solemn obligation to honor those who have served doeh surface, retirement, or ultimately upon their death. and is the responsibility ofú these organizations to see this commitment through. i would like to take a moment to note that today we will, will b. my last turn as subcommittee chair, that i'm extremely

pleased that today's focus is upon they l tremendous work of r these organizations. your commitment, your commitmen to the timeless honor of ourtmet nation's veterans and the compassion mission of nca, our miss oton national cemetery, and others but i've been proud tonc, work with all of you over thei region years at a trust that you andecentinue to go above beyond and care for our nation and our national and international shrines. that said, today the committeet is interested in hearing fromats the national cemetery administration on severalai focused areas, includingetery continued effort to provide better access initiatives forng rural veterans, those planned for urban areas and other t fute outlooks for burial options. will also hear about new regulations which was aimed to address an issue which was hear discussed at previous hearing is

regarding requests for headstones and markers made by a those other than the next 15. i also look forward to hearing updates on arlington nationalki. cemetery. and i note for the record mr. allen has done a tremendousi job at anc and we want to make forward. i thank you, mr. hallinan for your truly tireless commitment. and your evident passion for the mission that you serve.!rf5 additionally understand that 2014 a significant commemorative year for the nation for the american battle monuments commission. the far-reaching operations that abmc w hich operates in 16 foreign countries, and many others locations.abmc secretary cleland, thank you fo6 your service, for your continued service and for being here

today. abmc is remarkable organization and we appreciate hearing from i you. or now, i firmly welcome our witnesses as noted. these battles played significani roles in ensuring that we as ae nation fulfill our responsibility to honor those who assert all of us.ed these we hope we hope that through discussion and questions such ai will occur today, we were who collectively not only to meet s e h challenges that always ton exceed the standard.e first, mr. ronald walters, acting secretary for memorial affairs issued on behalf of national cemetery administratioa which oversees 131 cemeteries nn nationwide. mr. walters is accompanied by mr. glenn1 powers, deputy undersecretary for fueled depu under next, we'll have mr. patrickecre hallinan, executive director ofn army national military ha cemeteries that is alsove

testified on, will also testify on panel one pick in this role, mr. hallinan is charged with tef overseeing national cemetery, hn and finally secretary max cleland, the american battle today. secretary cleland will offer an update on abmc's mission planso. in recent commemoration. will also be hearing from a second panel including ms. amifz neiberger-miller who is the director of outreach and education for tragedy assistance programs for survivors, and ms. diane zumatto, a national legislative director for amvets. with those introductions complete, i also thank the members not on this committee but it was -- but who has ex pressed an interest in today's topic. i ask unanimous consent that representatives neighbors who is not here yet be allowed to

participate in this hearing. hearing no objections to orderh, to. allo thank you all for being with us today and i now yield to theheao orred.g member for her o opening statement. >> well, thank you, mr. chairmad and thank you for holding this hearing. i guess this is our grand finale.statemen i suspect this'll be the lasthe. time that are subcommittee meets during the session and i want to nale thank you for your leadership waings se and tell you what a pleasure to been to work with ou what a pleasure it's been to work with hinkite and tstaff on this you ålñ!ifwell served approach to these issues. >> i want to thank you for that also, because it'sd&bñ a two-wa street. thank you for your commitment and your passion. >> i also want9&0vç to+f"wx tha speakers who are here.o=jq especially secretary cleland

from4rdfv georgia, i know you s our feelings that our ligati to our the national cemetery administration has grown dramatically since the creation in 1862 and only 14 cemeteries were created to serve as resting place of our veterans after the war between the states. the administration also expanded its geographic diversity to better serve of veterans across the country and i know recent legislation added to your ability to do that. there are now 131 national cemeteries to new york as seven, ma three other states have six and puerto rico has to you. so access has grown considerably, but that brings me to my point. there is still a problem where some of our veterans do not have the ability to be buried in national cemeteries that are close to home and accessible for their families. this is especially true in the west, and the state with the

largest veteran population that is not served by a national cemetery continues to be nevada, which is the home to over 230,000 veterans, 153,000 of whom live in the las vegas area. so in total there are 11 states witwith a combined veteran population of 1.8 million who did not have an active national cemetery. and because most of those states are in the west, that's a lot of square miles that is covered that doesn't have access to any of the largest cities in the west like las vegas exceed the nca's eligibility requirements of 80,000 veterans. they don't have a national cemetery. you responded by proposing place but of national -- to get access to urban areas. these urban initiatives are great that you propose them for los angeles which already has two national cemeteries, and new

york that is served by three. this is good but it's really a matter of convenience, not a matter of necessity. those cities may not have perfect access but they are serving a lot better shape than it mattered in las vegas this got to travel for hours to california in bakersfield to get to a national cemetery. in salt lake city you have to travel eight hours for burial, and the closest national cemetery is in denver. so before you place more of these facilities of convenience, i'd like for us to look a little closer at cities that exceeded the 80,000 member requirement and see if we might not want to put some facilities there. so i look forward to hearing your plans or how to address that issue because as long as i'm here i'm not going to let it go. i'm going to keep bringing it up. appreciate working with you on it. a couple other specific issues i hope that we can address. one is at last march i sent a

letter to then secretary shinseki commending him for allowing same-sex burials of couples in national cemeteries. we need a policy on that. right now it's rather capricious. it's case-by-case. even if worked for national cemetery, the state senators have different policies, and that doesn't seem fair to me to our veterans and their families. and, finally, something that just recently has come to my attention is that veteran to serve in the armed services are at a disadvantage in another way. if you are the spouse of a pattern and you pass away, you can be buried in a veterans cemetery even if the veteran is still alive so the family members will be able to stay together. unfortunately, current law prohibits the va from bearing a family member of an active duty servicemen who passes away while in service. so i think that's something that we also need to look at him work on legislation to correct.

because some of these things only make it fair for veterans and their families. all veterans and their families, and rather than dealing with them in one way in national cemeteries, another in state, and on a case-by-case basis, let's work together to create a policy. i look forward to hearing all of your testimony, especially also from the battle monuments commission to house certain cutback and resources will affect the service that you provide. thank you, mr. chairman. >> thank the gentlelady. advised witnesses to complete a written statement will be entered into the record. we will move on to our first witness on the nca -- ncaa? nca. football on a my for some reason the mr. walter so you're not recognized for five minutes for your testimony. >> chairman runyan, ranking

member titus, and dissing bush members of the subcommittee, thank you for the opportunity to provide a review of the national cemetery administration's operations and our plans for continuing to meet the needs of veterans and their families. i make healthy today by glenn powers, deputy undersecretary for field programs. i would also like to acknowledge our partners from the army national military cemeteries and the american battle monuments. our shared commitment to honor and memorialize our nation's veterans is strengthened through our continued partnership. mr. chairman, under secretary mcdonald's leadership the department recently launched my va, an ambitious effort to reorganize the department and one that is centered around our customer, the veteran. it is this focus that has defined and will continue to define nca into the future.

consistent with the my va effort, nca measure success against the ultimate outcome for the veteran, direct feedback from our customers let's us know if we are achieving those outcomes. as reported in 2014 for the fifth consecutive time, nca achieved the highest score ever recorded or a public or private organization on the american customer satisfaction index. thanks to our employees, nca score of 96 was 28 points above the 68-point average for federal government agencies. our employees are nca's best assets, and we value their feedback. this year i am pleased to report that nca increased its participation rate in va's all employee survey by 10%. nca employee engagement, along with all the employees, is invaluable to the successful

design of my va. this is especially true of nca's workforce 74% of which are veterans, the highest percentage in the federal government. our employees are also more than willing to reach out to those in need of a second chance. i am pleased to report that we continue our efforts to end veterans homelessness. two years ago, nca established a cemetery caretaker of apprenticeship program designed to help homeless veterans. our second class of apprentices just completed their training on december 5. since the program's inception, 32 formerly homeless veterans are now employed full-time at nca. our third class of apprentices will convene this spring. thanks to the education of our entire workforce, nca's successfully met increasing

workload requirements in 2014 through our operation and maintenance program, we maintain over 3.4 billion gravesites, performed over 125,000 interments, issued over 600,000 presidential memorial certificates, provided over 360,000 headstones, markers and italians, and awarded 28.8 million to repair gravesites. in addition, due to our careful planning and management of construction in grant funds, no interruptions in burial services occurred at any national or state veterans cemetery. we continue to make progress on implementing new burial access policies reid's approved by congress. nca plans to eventually open 18 new cemeteries which will provide new or enhanced access to burial options for over 2 million veterans.

the new facilities include five new national cemeteries, two in florida will open this year, and one each in colorado, nebraska and new york. as well as a national cemetery presents in a highly rural come in five urban locations. we strive to better serve the veterans and their families in the future. nca recently received the results of an independent state study on emerging burial practices that address is green burials and additional ways to memorialize a veterans. we will be happy to brief the committee on the study in greater detail after we have completed our review. nca is planning to expand the use of gis and gps technology at our national cemeteries to enhance overall great site accountability. this technology will provide state-of-the-art mapping, great site and headstone information and will serve as the basis for ongoing great site accountability effort.

finally, we intend to explore how best to share the rich history of our national cemeteries and the stories of our nation's he rose with the public through a variety of approaches. mr. chairman, we look forward to our continued work with this committee, to care for those who shall have borne the battle, and we are greatly appreciative of your leadership, and all you've done for our nation's veterans. thank you again for this opportunity to be here today, and i would be pleased to answer any questions that you may have. >> thank you, mr. walters. with that we will now hear from mr. hallinan for his testimony. so you're recognized for five minutes. >> chairman runyan, ranking member titus, distinguished members of the subcommittee, thank you for the opportunities to provide an update on operation at arlington national cemetery. since my testimony to the subcommittee a year ago, we continue to build upon our

tremendous progress. we are setting standards for best practices, becoming a center of excellence while working closely with our partner organizations that i'm honored to testify with today. i apprentices i have one of the most stringent accountable the processes of any national cemetery. we have leveraged cutting-edge technology to develop an integrated solution that uses additional interments system to rewrite website to build and provide real-time mapping and a common operational picture of activities at the cemetery. our internment services perform systematic backups, have begun identification, burial location checks. it provides access to all digitized burial records, photographs of the casket and the earn, and each electronic internet record but it is a headstone design and ordering functionality and most of all it enforces the strictest custody of a federal cemetery. the agency map system tracks

great site availability, field operational status, procession routes while also containing great site and headstone gps location which are accurate to within three centimeters. these systems in concert ensure accountability and efficiency in operations at arlington cemetery. to keep up with the ever-increasing pace of request for burial at arlington we have additional schedules and we continue to make every effort of all our employees are trained to the highest standard when dealing with families and the public, treating each with respect and sensitivity. as we look to improve the appearance and operations within the cemetery, we are working on several projects. in october we began the renovation of a welcome center restrooms and move to improve our visitor's experience. we are currently renovating the basement of the welcome center to provide workspaces for our staff. another one of her goals for fiscal year 2015 is to redesign

and through the many which we gather and escort funeral processions. we are designing a new funeral procession for family vehicles and to make her funeral line lip much more intuitive and easy to negotiate. and i am also pleased to inform the subcommittee of planning and design efforts that are well underway with establishment called the tomb of remembrance. this project will allow us to provide the nation with a dignified place to provide final disposition of cremated remains which may be co-mingled or unidentified. in may 2014 we refurbished the slave from. with new exhibits which included museum quality cases to protect gifts to the tomb of the unknown soldier. we have completed an american with disabilities act sensibility study that will help us program and execute projects to ensure that our national shrine is as successful as possible for all those who wish to visit. we are actively designing progress to improve access to

our cemeteries. cemeteries. in 2011 we identified approximately $74 million in deferred maintenance. to date we have spent 40 million on improvement to the water line the roads, the buildings and the hvac system. we are committed to maintaining arlington as long as possible our nation's military heroes. millennium project is firmly within budget and on schedule to be completed in the summer of 2016. we will provide, this will provide the senator with additional 27,280 to burial spaces above caskets and interments. arlington has begun the design of the southern expansion project. once completed, both projects are expected to extend longevity through the 2050s. mr. chairman, as this is your last year on the subcommittee i personally thank you for your

leadership and dedicated support of arlington during your tenure. diligent efforts, installed procedures, repeatable processes, embedded technologies and institutionalized standards, will sustain and maintain the trust that it has reclaimed. we can assure the nation of this. every burial service at arlington national cemetery will continue to be conducted with honor and dignity our service members have earned, and their families will be treated with compassion and respect. thank you, i look forward to answer any questions you may have. >> into, mr. hallinan. without i recognize secretary cleland for his testimony. >> thank you, mr. chairman. may i say it's an honor to be with you again, mr. chairman and members of the committee. we will miss you, mr. chairman. we will miss talking football and miss talking our mission and miss, as ms. titus said, your

very evenhanded approach to these issues and bipartisan way. that's rare in this town, and i, for one, really appreciate. we will miss you. secondly, i'm honored to be with the people here at this table over the last few years. i've really gotten to know them. and i can tell you, patrick hallinan has been doing a great job out there, but now he's the tip of the spear. he's the guy leading the pack out of there. i was asked by the secretary of the army about four years ago to head up an advisory committee on the arlington national cemetery. they have come light years in four years. i can tell you that. four years ago they were operating off of three by five cards. now they've got the technologists they can launch a satellite. i mean, it's quite amazing the

transformation that they have put together out there. the veterans administration, mr. chairman, i used ahead many, many years ago, and we are working closely with the va. i met with secretary mcdonald and we're in agreement particularly on some sensitive issues regarding the punch bowl cemetery in a wide and visitor center experience there, and we are working close with all of the people at the table. and i say in terms of arlington, that the american battle monuments commission has put no charge to arlington, a liaison officer there on site, and he's doing a great job. he's been 17 years in western europe, and he's an added benefit i think for arlington. one of our staff members is on the advisory council for cemeteries that works at the va. that meets at the va.

i have with me today people who have labored in the vineyard been at the american battles on the moscow sure longtime. our chief officer and mike conley, art ministry of officer. we are just honored to be with them today. i would say, mr. chairman, basically that last night i saw the movie based on the laura hillenbrand book, unbroken, and it was a powerful testimony of one man's incredible endurance in world war ii. unbelievable unbelievable story. but the amazing thing about it is when you think that he was one of 16 million men and women caught up in world war ii that occurred on what, six of the seven continents, it was worldwide. ..service members caught u

up in world war ii,tyíñ it was worldwide con flag ration, that expanded the work of the commission, we now ry have 125, serviceu?&;w members buried in o%zçu we have 95,000 names)@up the world war ii on our tablets of the missing. 1)rj business. aw (j this business as general peshing said and welike to quote at the americanocú battlep3:rç s commission that time will not(l dim theaglory the one issue that congress gave was clark cemetery in 1967. i went by the old clark air base. it is now closed. the american government asked

the american military to leave a number of years ago. that left clark airfield base cemetery, which has been around almost 100 years. with about 8000 men, women, children, dependence unattended. and so, congress gave that mission. we have taken that mission seriously. we are in it with both feet. we are doing an assessment of what it will take to bring that cemetery up to respect to both stand or. it is not going to be the arlington of the pacific. it is not going to be one of our top-notch cemeteries. we will maintain it with dignity. but that is going to cost them money. so we'll be coming back to you in a couple of years for that. now, we are on that case. thank you, mr. chairman. >> kitimat for that,

mr. secretary. i know that was one of the issues in the forefront when i first took this position. with that, we'll start a round of russian name. this question is really for the whole panel. the collective expertise at the ncaa, army national cemetery is unique and frankly i want to say impressive. each organization must meet strict standards to properly honor those who served the nation. mr. hallinan touched on the topic of information services and the secretary also touched on that. i would like to think that is tremendously valuable it should be encouraged. how to reach of your organization share the information in organizations and how did the relationship of collaboration began. mr. walters. >> thank you, mr. chairman. well, we obvious they worked very, very closely with army and the american battle monuments

commission and our shared mission to serve veterans. for starters, both organization have a representative on the advice of advisory committee and their input on the committee, which ranges over a variety of issues. we have found extremely helpful over the years. with army, we have also established a board that meets two times a year to discuss areas of mutual interest and to share best practices. for example, mr. hallinan mentioned gis gps information technology, something the administration is beginning to use and we can certainly learn best practices from arlington success in that regard. i would also submit that there aren't many things that ncaa has shared with arlington that has worked equally well in their

favor. with a bmc, we are currently working on a project to construct an interpretive center at the punch bowl in hawaii. in fact, mr. powers was recently at the punch bowl to check on the progress of that. so we have many collaborative efforts as well to share in the historical aspects of our nations better and better cemetery grounds. >> mr. hallinan, anything to add quite >> mr. chairman, the question of how the communication and collaboration. i formerly worked with mr. ron walters and secretary steve morrow for 33 years with ncaa. when i came to arlington in 2010 during a difficult and challenging time, one of the first things i did was create a memorandum agreement between both agencies of the secretary

of the army approved and we took advantage of training that was ongoing and had been written and put in place based on 33 years of experience, decades worth of experiments. so we just continue to share over the last couple of years. my relationship with abmc with a number of our advisory committee. also my old boss when i worked at the va. so we've known each other for many years both professionally and as veterans. the relationship professionally and personally where they are. the defender written and though you and set up meetings where we can share some of these best practices in the committee is aware of what we've done with technology, what we have done with standard operating procedures, what we have done to train our staff and sensitivity with families. communications in place, mechanisms in place we are

working together. she's assigned outside my office, actively engaged, looking up over doing with technology and at the same time sharing the wealth of of experience on teaching the history of wearing the uniform. across the board and at this table and going forward into the future, the relationship documented in place to keep or were going. >> secretary cleland. >> mr. chairman, thank you very much. actually, the cooperation between these agencies is one of the things i am most proud of. hasn't always been that way as you well know. it is unusual for a government agency to work with another government agency because budgets and policies usually stovepipe and everything is lined up to where you are accountable to your

congressional counterparts and oversight people and you don't really talk to your colleagues even though they are in the same. we are in the business of honoring those who have served particularly when they get killed in action and particularly when they die and looking after their families. so that is the business we are winning. i made sure that patcher hallinan and the associate came over to the 70th anniversary of the normandy invasion. they are, all of us there with the commission and that the president of the united states. and then on june 6th this year. then the next day, they went back for a professional to her to look at the cemetery in

normandy and especially the interpretive center that we have bear, where we think it is world-class. arlington is now looking at that kind of thing themselves. so there is a massive change back and forth. are computer people, i see people had shared information for a number of years. in terms of the va, i met with secretary tom all. we have memorial with the va. it is unique. but they are the punch bowl cemetery, i was just out there veterans day. the va in the last few days. so we are working closely with them on that unique opportunity to work together to magnify the interpretive experience and make sure that the experience is something for future generations to grasp. i am proud to work with these folks and they are the best in the business as far as i can tell. >> thank you for that. my time is expired.

i want to say one thing because i think what you will do is unique and there is a personal relationship they are with a lot of the professional structure around it. i just wanted to highlight that point. but that, i will yield to the ranking member. >> mr. walters, i would like to talk to you about a urban initiative program and ask you, maybe you can explain the justification of why you don't include urban areas as people who have difficulty getting to stay cemetery is that they don't have a federal cemetery like in las vegas he have to go out to boulder city. if you take public transit, that takes you two hours and you still have to walk six miles. so there aren't any windows who can make that trade. why wouldn't those urban areas be considered for this initiative? >> the purpose of the urban

initiative at least as it is defined now is to provide ancillary service to existing national cemeteries where we had data that shows that there are problems with time and distance barriers at those locations. we have five very specific criteria against which we evaluate a potential location for the placement of a call and only cemetery. again, it is designed to supplement the national cemeteries and to address gaps in surveys that our customers are telling us through formal surveys and other means another feedback. >> would it make sense to look at expanding that to also include access to the stay cemetery when there is no national cemetery quite >> i think certainly it makes sense to begin to engage those who use stay cemetery is in

varied levels of stay cemeteries the same way we do with national cemeteries. from that point on, we could then ask them and whether it is most appropriate for the pa to step in to provide those facilities. or if we can work with the states to be there provide bad or perhaps provide a better rationale for the placement of the cemeteries to begin with at the state level. >> you think there is something in the funding formula that discriminates against location of the cemeteries in the west that could be addressed? >> in the state grant quite >> or the national location of the national funding formula quite >> absolutely not. there is no formula for the allocation of money. what determines the allocation of money for the placement of the national cemeteries is our access policies, which is wherever we have 80,000 veterans

within a 75-mile radius of a proposed site, that is where we place a new national cemetery regardless of what state it is thinner whether it crosscuts states or other factors. >> that doesn't seem to be working very well in the west, does that? there's more than 80,000 veterans in las vegas. >> well, yes, ma'am. as you know, access policies at this point consider veterans with the option if they have access to be there a national or state senate are. >> would argue that's not convenient if you override two hours each way on mass transit and what six miles. that's not very convenient. >> our access standard does not take into account the driving time and distance. it is mileage. my understanding is boulder city is 30 miles from las vegas. i am not aware of what the

driving time would be. the bottom line is we do not consider barrio in a state cemetery to be an inferior option to being buried in a national cemetery. >> a few other choice, mr. walters, would you rather be married at a state cemetery or national cemetery quite >> i would prefer to be buried in a place that is a national shrine and states can achieve national shrine standings and be cared for by individuals who are committed to perpetual care of our nation's heroes. >> let me ask you this. the cemetery and boulder city is great. but how much oversight you have an stay cemeteries after you provide some of the funding quite state cemetery is a very very much in terms of quality, policy, or a ability of same-sex mac couples. do you go back and oversee

these? want to give the money, you will trust the state veterans to be sure they keep the national standard quite >> no, ma'am. we have a fairly rigorous compliance review program, which we just revamped about a year or so ago. where we go to state facilities and we apply the same scorecard, same operational standards and measures that we do to her national cemeteries to the states where applicable. obviously there is some criteria that are only applicable to federal facilities. we do review the states. we have scorecard for them. we give them opportunities to submit corrective action plans in those instances were they find shortcomings that we work with them to com2 closure of problems. if i may mention one other thing about the exact interstate cemeteries, we recently conducted the first ever

customer satisfaction survey with those e.u. states cemeteries in. their love ones in-state cemeteries. we don't have a full result, but we were able to extract some overall results that 90% of the respondents believed the appearance of the cemeteries were excellent. 95% agreed that the quality of service provided at the state facilities was excellent and 98% said they would recommend the state cemetery to a family member. >> you know, i appreciate that. those are good statistics. that is like asking a person in an ice cream store eating ice cream if they like ice cream. you're not asking other people who have chosen not to use the facility but the reason is and what they think about it. i just worry about state cemetery is having different policies in different states, just like your homeless program. it is only a national cemetery.

so i just think we need to work together on trying to fix that. thank you, mr. chairman. >> recognize mr. pillar bracket. >> i want to thank you, mr. chairman. you're a champion for veterans and i really appreciate the tremendous advocate. thank you. senator, first of all, thank you to for your service to our country. i also visited -- i got an opportunity to visit the clarks summit terry and i want to also think the vfw and the other service organizations who have maintained the cemetery up until now. the outstanding jobs. again, the private funding has come from our veterans over the years. i have a question for

mr. walters. there have been a few instances in the past where individuals have highlighted concerns on specific sides are specific issues and my constituents have come to me as well. for example, with a raised in real blind were prone headstones appeared as though they had been run over by the construction vehicles. committee has largely founded ncaa to be very responsive when contacted on the fish is in the last few years. my question is how do individuals, how do i constituents to visit national cemeteries raise concerns to the ncaa and what actions are taken upon reviewing those complaints or questions? >> yes, thank you for the question. we have a variety of forms through which those who visit our cemeteries and voice concerns beginning with complaint logs that are maintained at the cemeteries.

if an individual has a concern about something that he or she encountered, whether it be the physical appearance of the cemetery where the service that was received, they can record in the complaint logs their observations. that complaint log is kept and it is reviewed for our organizational vestment improvement program and all of the complaints are followed up on in a timely manner. of course there are other ways to do it. we have received a variety of letters from individuals expressing can earn about specific issues that cemeteries and we apply the same level of aggressive resolution to those complaints as well. >> do you respond to the individuals quite >> yes, sir. we respond to individual letters absolutely. >> how long does it take?

give me an example. >> i think it would depend on the nature of the complaint and how quickly we can resolve it. we usually try to put out an interim response at first to say we are working on the issue. beck is that if we send one within a few days. and then, the actual resolution can vary depending on the nature of the issue. there was an issue recently at riverside national cemetery, for example, where we had contract errors that were treating headstones and the browns in a manner that was inconsistent with what we regard as national shrines. this complaint came to life. we acted very aggressively. we corrected the situation and in fact, we added language referred to as his dignity clause two of our national shrine contracts, where contractors now have to be especially conscious of what they are doing at our gravesites

to make sure they are honoring the dignity of the burials. >> thank you very much. one more question, mr. chairman. he testified, mr. walters come on the current ncaa proposed rule implementation of the dignified aerial act of 2012. it is my understanding the national funeral directors association expressed concern with one of the details of the proposed rule. under previous rules, funeral homes were able to apply directly to the va for partial reimbursement or other associated benefits. in their view, there's a view, there's a lack view, there's a lack funeral homes to easily provide the veteran with a timely and dignified aerial and that is what i'm concerned about, but convenience for the family and of course for the veteran. without any concern about not being compensated for their services. additionally, situations without a next of kin, under the proposed rule funeral directors would apply to become the

authorized representative, which would add difficulty and additional cost to a process where funeral directors are trying to honor our nation's fallen heroes. can you explain why ncaa is not allowing funeral homes to apply directly to the va? whether in a comments to this provision supporting or opposing the change during the public comment period? i don't want to delay the process for the families, particularly when there is no next of kin. if you can elaborate, i would really appreciate it. >> yes. congressman, the administration of that particular program falls under the veterans benefits administration. so i would be happy to for the record provide a response. i will say that the intent of the jarecki payment to the veteran was to do precisely what i psyd said towards the end of your comments, which is to make sure that the families receives

the money as quickly as possible and to pay their expenses with it. i also know that under secretary hickey's leadership, the automation of burial claims has been put into place such that nearly half of them at this point are processed that way without human intervention, which then frees up staff time to perform other work and the processing time for this burial claims has been reduced from a peak of 190 days in february of 2013 to 64 days in december of 2014. but again sarah, i will -- >> my concern is there's a lot of local funeral homes and they want to help other families. i just don't want to delay the process remake it in convenient for the families or they don't

have the next of kin to take care of it directly. i appreciated very much, mr. chairman. again, thank you for your service. were going to miss you. >> thank you very much. i recognize mr. o. work. >> thank you, mr. chairman. i also want to join my colleagues for the ways let this committee. i've enjoyed working and have learned a lot and look forward to watching the great thing the great things to do in the future actually this institution. thank you. to the secretary, mr. walters, first of all, i want to thank you for the great job you do and that your team does. you have a new person in el paso, texas, the person i had the honor of representing. any callahan is doing a trippy job. works well with our team, works well and is attentive to the families in el paso. i want to thank you in the team

in el paso to a phenomenal job. thank you. >> as your predecessor, mr. morrow come even responsive to estimate personally. we are able to talk on the phone about concerns before they become real problems. i want to thank you for that as well. i think the cemetery in el paso is in many ways remarkable. it is very clean, well cast, a great staff and the response and i think you probably have to data to back it up in terms of surveys from those customers to serve has been great. but as you know, there is one disconnect between the ncaa and el paso when our offices and that is the fact that el paso is one of three waterways the term you use, cemeteries out of the 101 in the system. it is deeply unpopular amongst those people whose opinion i

care about the most as the veterans and their families, the widows and widowers, the children, the descendents of those who are buried there. you have approached this is an either/or proposition . either we have turf and grass and i think your argument is when el paso had that, it was suboptimal. or you have waterways, doesn't require and is cost efficient and in the opinion of them is aesthetically pleasing. to remind everybody when we talk about water wise, we are talking about crushed rock and dirt on ground. we are not talking about a desert landscaping, although there is some landscaping with shrubbery and some trees. imagine you're in el paso, texas, visited a family member there and it's 110 degrees and you are asked or want to kneel and you can't because you are asked to neil on this crushed gravel.

i am looking for an option, some way to work together to get past what is unacceptable to my community. we are also asking to know what the criteria are that you used to make those decisions. my understanding is only three out of 100 arty ones. i don't know if mr. hallinan would be comfortable converting arlington cemetery to a water wise facility to save money and time and make and time in me is cost. i'm going to guess the answer is no. so our contention in el paso as if they water wise ncaa cemetery is not sufficient for the best in our system, then you should not be sufficient for el paso. i want to get your comments and thoughts on that and perhaps a suggested path on which we can work to resolve the situation for el paso. >> thank you for the question, congressman o. o'rourke.

our decision is not arbitrary. it is based on a variety of fact yours to include climate condition as well as the availability of water. in the case of el paso, as you know, the decision 20 scape that cemetery was based on a congressionally mandated study in 1999. the results of the study indicated that if el paso were to be maintained as a national shrine, there was not a sufficient amount of water to do so. the study recommended zero scape being the entire cemetery. at that point we made the decision to make the investment 20 scape the cemetery. >> you are giving me the history. i'm asking for the future.

how are you going to work together to resolve the situation? what we have is unacceptable. >> just to say, our survey results, just to put them on the record, our survey results from those using the cemeteries of just a high degree of acceptance. at answer to your question -- >> i refer to my colleague's ice cream shop analogy. i don't know that we are asking those whose family members are already buried at the cemetery, did not have a choice of whether was converted from grass to rocks and who are deeply disappointed in that and ask if their federal representatives to do something about it. when i get is the process that you use to a private this decision that is deeply unpopular and not acceptable to me and the people i represent. i am asking for now is how can work together to do something? perhaps we cannot turf the entire cemetery. perhaps there is some water wise solution with the crushed rock that cover the gravesites we

have in el paso today. because i'm out of time and because it probably involves a longer conversation, i would like to gain your commitment we can work together to do that. >> absolutely, congressman. we are always willing to work with you and your staff. we have done so in the past. we will continue to do that with you. a good launching point may very well be the study that u. t. el paso is currently undertaking when they're examining soil conditions and perhaps coming up with some recommendations for things that we can consider. so absolutely, we are more than willing to work with you and your staff. >> great, thank you. thank you, mr. chairman. >> without i recognize mr. stivers. >> mr. chairman, i want to thank you for exception in this consent for me to sit on this hearing. i appreciate your leadership. it has been an honor to serve with you in congress. i know other than going to the university of michigan, you had a distinguished career, happen

to be a buckeye. i wish you would come to ohio. [laughter] i really do appreciate the way you have treated our veterans of the way you treated this committee with respect and really worked with oocytes accompt a common ground. thank you for allowing me to be here. i have a couple of questions for mr. walters and then i want to do one question with mr. hallinan. mr. walters, i appreciate your new october 1st draft of regulation that would deal with next of kin. g6ajx2#÷ homeless4obç veterans and folks identified because they had servetugyw in a conflict much further bacc1$e)s7l in our