security where i live, but also on the way you run this committee which is for us to do what's right for america. mr. attorney general, i do want to address some of the areas of border security. first of all, scaap funding is something that continues to be short changed by your budgets. scaap, of course, is the reimbursement for local law -- counties that incarcerate illegal alien prisoners. along the border, our counties are generally very poor and don't have those kinds of resources. each year you continue to not fund. we did put the money back in last year, $240 million.

i would hope you would support increasing that as we go through this process because we must incarcerate these illegal alien criminals who are mostly in the drug cartel operations so this will not be borne by the counties on the border. in response to operation fast and furious, language was included in last year's bill that would prohibit federal law enforcement agencies from selling operable weapons to cartels. this request that you're giving us removes that language, saying it's unnecessary. mr. attorney general, we want to make positively sure that what happened does not happen again. i would hope that you would support our insertion of that language again. last year, our commerce justice state bill provided $10 million to expand the capacity at the overcrowded el paso intelligence center. and this is critical for our

southwest border information sharing and has the potential to become the border's focal point to help stop the flow of narcotics, combat illegal immigration and end human trafficking and firearms smuggling. it is imperative that this el paso intelligence center and the dea take full advantage of the resources available from the department of justice agencies, the fbi, the u.s. marshals and the atf, and i hope that you can give us an update on the status of this funding and the project. there have been reports that cartels across the border are attempting to recruit college students to smuggle drugs into the country, and it says that minors are more appealing because criminal penalties are lighter for them. one of the good parts of your budget request is $312 million

for juvenile justice prevention programs, and i will be interested in hearing if you think -- if you're aware of these border threats to our youth and if some of that money that you are requesting could be put on the border to try to make sure that we try to help our youth overcome the cartel overtures. in addition, there is a requested cut of 1.5% from state and local law enforcement grants which are very important grants, again, to these local counties and the local law enforcement agencies along the border that have such a burden with the trafficking that is coming across the border. i would hope that you would help us restore that funding. the v.a.l.o.r. program, the violence against law enforcement

and ensuring officer resilience and survivability is one that i applaud your efforts to put in place. and unfortunately, the number of federal, state and local officers who died in the line of duty in america last year increased from 153 to 173. the feedback from the training and research being conducted through v.a.l.o.r. is very positive, including the alert center at texas state university which was credited by the two officers who came into ft. hood when major nadal hasan started shooting unarmed military people. both of those officers survived even though sergeant munley was shot several times. but they both credited their swift response that day to the alert active shooter training program that they had received.

so that's something that's very good that i applaud in your budget. i want to state a concern that i have about the u.s. national parks service pushing for construction which is in progress on an unmanned border crossing at the big bend national park in south texas. this is not a department of justice decision, but it is going to affect some of the personnel, and i'm concerned that this is an area where illegal immigrants can walk across. the water is knee deep and you can walk right across the river and into big bend. and having an unmanned border crossing i think is insufficient. so we're going to talk about that at some point to see if we

can get fbi, dea, atf, border patrol, somebody to man a place like that where it is so vulnerable. last but not least, general holder, i'm going to ask you some questions about your public integrity unit. i'm going to give you full credit for dismissing the case against senator ted stevens when you learned of the corruption within that division of your department. i'm going to ask you questions because the report will be public within days, and if there is anything that you should take as your major responsibility, it is that the public corruption unit and the department of justice is fair and even-handed and clearly that was not the case in the prosecution of a great friend to many of us and a

great patriot for our country who unfortunately was very badly abused by the department of justice. but i will say you did dismiss the case when you learned of the misbehavior, and i gave you credit on the senate floor for doing that and will again. but i do want to ask you about the report when we have time to ask questions. thank you. >> mr. attorney general. >> thank you. chairwoman mikulski, ranking member hutchison, other distinguished members of the subcommittee, i thank you for the opportunity to appear before you today and for your continued support of the justice department's critical work. i look forward to discussing the president's fiscal year 2013 budget for the department and

how these vents would be used to build on what i think is our extraordinary record of success. now, the president's budget proposal demonstrates a clear commitment to advancing the department's core missions an augments our about to fulfill our most important obligation. that's to protecting the american people. despite the significant fiscal constraints, the federal government has faced in recent years, the 116,000 dedicated employees who serve in the department offices around world have made significant and historic progress in protecting our citizens from a range of threats that often disproportionately threaten the most vulnerable members of our society. we've proven our commitment to acting as stewards of precious taxpayer dollars. as you can see in the budget request, proposed spending increases have been exceeded by proposed cuts. as a result of numerous steps taken to streamline operations, almost $700 million worth of savings have been developed and reinvested in critical mission areas. i believe that the department is perhaps more efficient and more

effective than ever before. our recent achievements underscore this point, especially when you consider our national security efforts. by continuing to work collaboratively alongside u.s. and international partners, we have identified and disrupted numerous alleged terrorist plots including one by two iranian nationals to assassinate the saudi ambassador to united states. we have thwarted multiple plots devised by home grown extremist s and secured convictions and robust sentences by dangerous terrorists. in october the department received a guilty plea. last month abdulmutallab was sentenced to four life terms in november. in november we secured the conviction of victor boot, a notorious arms dealer who sold millions in weapons for use in killing americans. and in december alwan pleaded guilty to 23 charges including

conspiracy to use a weapon of mass destruction against u.s. nationals abroad, attempting to provide material support to al qaeda in iraq and conspiracy to transfer, possess and export explosive devices against u.s. troops in iraq. the list goes on and on. with the sustained and increased investments included in the president's budget for the comprehensive national cyber security initiative, the high value detainee interrogation group, the joint terrorism task forces, the render safe program and other key national security effort, the department will be able to strengthen our critical surveillance and intelligence gathering capabilities. it will also allow us to bring our fight against financial fraud to a new level. on monday, as many of you know, president obama issued a proclamation to mark the beginning of this year's consumer fraud protection week. i'm proud to note that the justice department's consumer protection branch has established a record of success in defending the interests of american consumers that is worth celebrating and will be expanded upon.

in 2011 alone, our consumer protection branch obtained a 95% conviction rate, recovered more than $900 in criminal and civil fines, restitution and penalties and obtained sentences totaling more than 125 years imprisonment against more than 30 individuals. this represents remarkable and unprecedented progress. it really is only the beginning. in fact, since the start of the administration the justice department has signaled an unwavering commitment to combating and preventing a wide range of financial and health care fraud crimes. we've taken bold steps to address the causes and consequences of the recent economic crisis. through the efforts of the president's financial fraud enforcement task force which was launched in 2009 and which i'm proud to chair, charges have been brought against numerous ceos, cfos, corporate owners, board members, presidents, general counsels and other executives of wall street firms,

hedge funds and banks who have engaged in fraudulent activity. in recent months we have obtained prison sentences up to 60 years in a variety of fraud cases including multi-million dollar ponzi schemes and the largest hedge fund insider trading case in u.s. history. just this week we secured a conviction against the former board of directors chairman for an international bank for orchestrating a $7 billion investment fraud scheme. the task force established two new working groups, the consumer protection working group which will enhance civil and criminal enforcement of consumer fraud and the residential mortgage backed securities working group which will bring federal and state partners together to investigate and prosecute abuses in our housing markets.

both will help to amplify existing efforts and to foster cooperation and collaboration in the department's response to these problems. just a few weeks ago, a similar collaborative approach led the departments of justice and housing and urban development, as well as other agencies and 49 state attorneys general to achieve a landmark $25 billion settlement with the nation's top five mortgage servicers, the largest joint federal state settlement in our nation's history. although this will not on its own cure all that ails our housing market, this agreement builds on the record fair lending settlement obtained last year and will provide substantial relief to homeowners. it also provides a blueprint for future collaboration across levels of government, state borders and party lines. but there is perhaps no better illustration of our recent progress than the department's groundbreaking work to combat health care fraud. over the last fiscal year alone in cooperation with the department of health and human

services as well as other partners, by utilizing authorities provided under the false claims act and other essential statutes, we were able to recover nearly $4.1 billion in funds that were stolen or taken improperly from federal health care programs. that is the highest amount ever recorded in a single year. over the same period we opened more than 1100 new criminal health care fraud investigations, secured more than 700 convictions and initiated nearly 1,000 new civil health care fraud investigations. and for every dollar that we have spent combating health care flawed, we have returned about $7 to the united states treasury, the medicare trust fund and others. these numbers are stunning, but my colleagues and i recognize that we cannot be satisfied, and this is no time to become complacent. that's why in addition to helping us build on this record of success, the president's budget request also would bolster our fight against drug trafficking, international crime networks, gangs and cyber

criminals, it would increase our efforts to protect the law enforcement officers who keep us safe and expand upon the work being done by our civil rights division to guarantee the rights of all americans are protected in border areas, workplaces, housing markets and voting booths. i am committed to building on these and our other many achievements. i know you understand in this time of uncommon threats and complex challenges, we simply cannot afford to cut back on the amount and the quality of justice that we are obligated to deliver. the department must remain vigilant in protecting this nation and in enforcing the law. these efforts must be appropriately and adequately funded. i look forward to continuing to work with the members of this subcommittee and your colleagues throughout congress to accomplish this. i would be happy to answer any questions that you might have. >> thank you, mr. attorney general. your full statement will be entered into the record. as a matter of senatorial courtesy, we'll turn to senator shelby who has a banking committee that he must join. i'll pick up followed by senator

hutchison. we will recognize then members in order of arrival and follow the five-minute rule. senator shelby? >> thank you, madam chairman. good morning, mr. attorney general. >> good morning. >> two key department of justice facilities will soon be operating on red stone arsenal, the fbi's terrorist explosive device analytical center or tedac, and the a ncetar's national center known as ncetar, these two national assets will help law enforcement officials deal with the growing threat posed by terrorists in criminal use of powerful explosives. you and i have discussed these facilities previously. i believe you agreed then with me that the missions of ncetar and tedac are distinct but complimentary and that it made sense to co-locate them at red stone where there's a lot of property, a lot of land. for the benefit of the committee, mr. attorney general, can you describe how the department. of justice will utilize ncetar and tedac.

>> -- run chiefly by the fbi deals with the examination of ieds we see coming out of afghanistan and other places. ncetar in contrast run by the atf deals with -- i wouldn't want to call them the more common. >> more prevalent maybe. >> more prevalent explosive devices. and i think that you're right, they have fundamentally different responsibilities, but and the location of them in that place, i think, makes a great deal of sense. >> could you describe the value of co-locating these facilities on a large federal arsenal with a large range of space? >> i think there's a great deal of cross pollin nation, the ability to talk to one another. although the purposes are distinction, there's going to be scientific things, break through, perhaps, that you can

exchange information sbi having people who are relatively close by. i think having the two agent agencies responsible for explosives and determination close by, even though they have is distinct roles are pretty well delinqueeatqueneatdelineat. having them to talk to one another. >> highest per cap taf phood commu -- capita ph.d. there. >> there's a lot there, that is fair. >> -- and pay for it, i guess. attorney general holder, the justice department is seeking funs this year to activate a new

prison in alabama. this prison was designated as a female only facility based on input from your department and it cost nearly $250 million. is the department prepared to act this soon? it's got a lot in it. the u.s. bureau of prisons said that was one of their top priorities. >> yep, we want to activate it. it was specially designed to deal with the unique needs that female prisoners have. we need to expand our capacity to handle female prisons in the federal system. given the fact that the facility was specially con figures for female prisoners, it would be our hope to activate it as quickly as we can and for the use for which it was designated. >> it has a lot in it and i hope you would do that soon. because to activate it could cost hardly anything compared to

what it costs to build. >> no, i don't disagree with that. and the need is clearly there for the expanding female population. unfortunately, that we see in the federal prison system. >> is it a priority for you? >> yeah, we want to bring online as many of these facilities as we can. and this is one, as i understand it, is extremely close -- we were just about ready to open it. >> madam chairman, thank you very much for taking me out of order and i appreciate it very much. >> mr. attorney general, i have two questions. first of all, federal prisons. as i look at the department's budget, almost 1/3 of the department's money is going into federal prisons. the amount is now $6 billion, and it is rapidly approaching

almost what the fbi budget is, which is $8 billion. now, my question is, what's going on with federal prisons? now, if people are incarcerated. first of all, we want the bad guys and gals off the street. so we want you to prosecute and incarcerate particularly where there are people who constitute a danger to our country or to our communities. but i don't know if we can sustain this growth. once we gt them in, it's a revolving door. they keep come back. could you elap rate on your department's needs? but is there any recommendations you would have to begin to contain the crimes? is recidivism the problem?

again, safe streets, but this is really an ever increasing part of our appropriations. >> i think there's a variety of reasons we see the fop lags population increasing. i think there are a variety of reasons. there are some cases that violate both federal law and state law, and if there are very serious criminals we bring into the federal system. if there are evidentiary rules and more harsh systems to bring to them. we need to come up with ways we

make available to people reentry possibilities so they have the chance of not being recidivist so they come up with education, vocational, drug treatment programs. we have seen good success being done by some state systems. it has been shared to me but the pugh research foundation. >> mr. attorney general, we would really look forward to specific recommendation where is, again, we -- we want our local and federal law enforcement to prosecute and get bad people off the street. whether they're terrorists or whether they're terrorizing a neighborhood like some of the drug dealers in some of my own communities in m.arylanmaryland.

we want our prisons to teach them how to be better citizens. and then to come back to a community support system where they don't fall back into the behavior they that got them. so i'm concerned that our federal prisons are such that we really need to evaluate and learn some of these. we want to work with you. i know you feel that way. you're very experienced with street crime, which takes me to the other. i'm ultimately, while you've done this fantastic job of fighting terrorism, keeping america safe, it's been stunning what our national security services have accomplished. both military and civilian. but you know, again, i'll come back to streets and neighborhoods. we talk to our local law

enforcement, local prosecutors, they need cops on the beat and so on. do you feel this is sufficient funding? because in the last couple of years, in 2010, we had $3.7 billion that went into state and local grants. due to acts of congress and so on. now we are down to $2 billion. yet everywhere i go in maryland, from our local police commissioners to local district attorneys or states attorneys as they're called in my state, people say we need those justice department grants. they either give us better technology. they give us tools to deal with violence against women. they express gratitude for the lethal index. they need you. they love having you as a partner. do we have enough money in the right places to do the job to

protect our communities? >> we have $2.6 billion for programs. $1.4 billion for justice office programs. $412 million for the office on violence against women. this is a level that's about equal to the level we requested last year. it is lower than the numbers you had said, but i think given the budget realities that we face, the amount that we have requested is strong for law enforcement, it's strong for science, it's strong for victims. would i like to have more money? yes. but the reality, the budget realities that we confront and the needs to stay within a budget of the executive dranch have gotten us to this point. but i think through the provision of this money, the technical assistance that we can also provide to our state and local partner, we can do the b

job. i met with the association of the attorneys general this week and i think the combination of that partner shship. >> what i would find very helpful is two things. if you look at your grants, cops on the beat and so on, what was the amount of money requested to apply for those grants and what could you fund? my time is up. so i would like that for the record. the second thing is the gao report raises issues related to duplication of services, and i would like to have your reaction to the gao report on how we can streamline, get more

efficiencies, i think you're already on that road. senator hutchinson? >> thank you madam chairman. mr. attorney general, we will have questions for the record, but i wanted to pursue this public integrity units misconduct against senator stevens. the court appointed counsel after you moved to dismiss the stevens. the court appointed council after you moved to dismiss the case, the court appointed council to investigate the botched prosecution of senator stevens and found the prosecutors engaged in systematic concealment of evidence, but they were not guilty of criminal contempt. according to the summary that was put out in the public, the full report coming later, it said that the court said despite findings of widespread and at times intentional misconduct, the special counsel, mr. schulke

recommended against contempt charges because prosecutors did not disobey a clear and equivocal order by the judge as required under law. judge sullivan said, upon review of docket and proceedings in the stevens case, mr. schulke concludes no such order existed in this case. whether the court accepted the repeated representations of the subject prosecutors that they were familiar with their discovery obligations were complying with those obligations and were proceeding in good faith. my question to you is, does it concern you that the only reason these prosecutors escaped criminal charges is that the judge in the stevens case did on the file an order specifically telling the prosecutors they should follow the law? >> i think we have to take into account a variety of things. when i was made aware of the issues that led to the inquiry that judge sullivan ordered, i