i have made friends during my time here and lost some of them to the vagaries of life but each of them have left a mark on who i am and who i still aspire to be. the beauty of this department is that at its best it's like our country, at its best always growing, always changing, always being vigilante in defense of those values that distinguished this nation and made it truly exceptional. this quality is derived from the ideals that serve as the foundation for all that we love about america. great as it is our nation is not yet perfect. the fact that we can acknowledge this is what truly distinguishes us as a people. we have always examined ourselves and determined what needs to be improved that which needs maintained and that to which we should aspire.

this is the essence of and the beauty of the united states of america. unlike other countries complacent in older systems we're still young, dynamic and unafraid to question ourselves. this spirit initially led to revolution and then to the removal of the sin of slavery, the right of women to vote, a great civil rights movement that truly transformed our nation and now a recognition of the reits of all americans regardless of their sexual orientation. make no mistake we still have unfinished business and work to do. reform of our criminal justice system must continue. and under loretta and sally i'm sure that will be the case. the historic wrongs visited upon our native people must be righted. the widening gap of income inequality must be reversed. in the defense of our nation we must always adhere, always

adhere to the values that define us. and at all costs. all costs the right to vote must be protected. [ applause ] now that list may seem daunting but if we are true to who we are as americans, no problem is too big. no issue insurmountable and beware of those who take us back to a past that has never existed or that was imbued with a forgotten inequity. our destiny as americans are ahead of us. our gaze is always focused on the horizon. those who have loved this nation most have dared greatly and have sought to change the status quo for the better. the founding fathers who never let it be forgotten they chose

revolution rather than accept an unjust status quo. lincoln, frederick douglass teddy roosevelt fdr, susan b. anthony, margaret sanger jackie robinson, john lewis and dr. king jfk and lbj, vivian malone harvey milk barack obama. [ applause ] we should not fear change. it is part of who we are as americans. it is what distinguishes us. it is what makes us unique. now, i leave this place proud of what we have accomplished over

the last six years and grateful for all that doj has given me these past 39 years. this has been my home. and you will always be my family. i thank the parents who raised me. and the west indian sensibility that they instilled in me. the new york city public school system that educated me. columbia university that nurtured and tolerated me. [ laughter ] the women who has loved me so long. the kids who have between joy and i hope they really understand the true pride the true pride of my life. a brother who has been more than a sibling he's been a dear friend. beautiful, sisters-in-law a brilliant brother-in-law. the guys at the cologne.

you know who you are. and my crew from 24th avenue and 101st street. and more recently a president and colleagues in this administration who stuck by me when i didn't always make at any time easiest thing to do. i'm grateful to this great nation who gave a black kid from east elmhurst queens new york city more support and opportunities than any individual could have hoped for. thank you, america. to the wonderful dedicated accomplished men and women of this great department, i really realized i asked a lot from each of you in the last six years but let me make one final request. keep going. keep fighting. keep believing in your ability to improve our country and our world and know this. know this. no attorney general, no ag has ever loved this institution or

you more. not one. now i lack the words to fully convey what this place and all of you mean to me so let me end this -- let me end this way and paraphrase duke ellington. i will miss you as i have loved you all madly. i love you madly. thank you and good-bye. [ applause ]

mr. attorney general, i know that we promised you that there would only be one speaker for today's event and there's only going to be one speaker but we do have a special musical guest for you today. it's someone who has the utmost respect for you. and when i say respect, i mean r-e-s-p-e-c-t. ladies and gentlemen miss aretha franklin.

[ applause ] . >> hold on. >> okay. [ laughter ] >> thank you. >> threw go. >> okay. [ applause ] ♪

♪ o beautiful for spacious skies ♪ ♪ for amber waves of grain ♪ ♪ for purple mountains' majesty above the fruited plain ♪ ♪ america

america ♪ ♪ god shed his grace on thee ♪ ♪ and crown thy good with brotherhood ♪ ♪ from sea to shining sea ♪ ♪ america

♪ in great stride ♪ ♪ my country ♪ ♪ and mercy ♪ ♪ america america ♪

♪ may god ♪ ♪ may god glorify ♪ ♪ and specialness ♪ ♪ and nobleness ♪ ♪ and every ♪ ♪ every ♪ ♪ every divine ♪ >> mr. attorney general eric holder speaking for we the people, we appreciate you and god bless and keep you as you go forward in all of your

endeavors. ♪ he's courageous ♪ ♪ integrity ♪ ♪ a hero ♪ ♪ yes he is ♪ ♪ he's a champion ♪ ♪ he's a warrior ♪ ♪ yes he is ♪ ♪ yeah yeah yeah ♪ ♪ oh yeah ♪ ♪ let everybody say yes ♪ ♪ say yes ♪ ♪ say yes ♪ >> thank you. [ applause ]

wow. thank you, miss franklin, for that incredible rendition of "america the beautiful" and thank you for joining us here today as we celebrate our attorney general eric holder. since there's no way to top having president obama speak, and aretha franklin sing, i think that's going to conclude our ceremony here today. but we would like to invite everyone up to the fifth floor

to join the attorney general and his family. thank you again for coming today. if you could wait and let the attorney general's family exit this room first so that they can take some pictures please come on up to the fifth floor and have an opportunity to see the attorney general and his family then. thank you for coming today. [ applause ]

at the justice department the unveiling of the portrait of outgoing attorney general eric holder. the president speaking and music from aretha franklin. loretta lynch the nominee for attorney general was confirmed by the senate judiciary committee just yesterday. well negotiations are going on this evening on capitol hill to try to find a solution to funding for the department of homeland security. money for the agency runs out at midnight tonight. in the past hour or so the house voting to block a three week temporary spending bill. that bill failing on a vote of 203 yes votes to 224 no votes. both the house and senate recess now as leaders try to work on a way forward. the senate earlier passed its version of a dhs spending bill

today without provisions blocking president obama's executive actions on immigration. meanwhile a separate bill from susan collins to defund those actions failed to advance in the senate. elsewhere on capitol hill today water experts testified on challenges affecting small and rural areas before a house energy subcommittee. issues discussed include water systems and funding and regulatory compliance. this runs about 90 minutes. >> i would like to call the hearing to order and recognize myself for opening statement. today's hearing focuses on challenges facing rural water systems. i congratulate and thank the ranking member of the subcommittee and the vice chairman of the subcommittee for their bipartisan work to raise a profile of this issue before the subcommittee. according to census bureau 27% of the u.s. population lives in rural areas. the smallest water systems

account for 77% of all systems. as someone who probably represents communities and small town and rural america i'm glad we have bipartisan interest in tackling this subject. under the safe drinking water act small and rural drinking water supply systems are subject to a number of drinking water regulations issued by epa. these requirements include systems monitoring treatment to remove certain contaminants. it's erratic these communities where residents work hard to support families and local government while earning wages lower than their counterparts in urban areas and demands that are disproportionate to larger communities. sometimes it's just a matter of having the ability to keep up

with the red tape. while i'm sure we will explore the funding mechanisms under epa the agriculture department and other federal agencies not just a matter of throwing more scarce money at the problem rather it's about smartly assessing what the needs are for these systems, prioritizing the importance of those needs finding out whether the current system can be improved to remove a necessary burden and eliminate bureaucracy and examining whether voluntary or other efforts can aid where congress cannot. i want to thank our witnesses who have put their lives on hold to battle the elements and join us. people who live in rural munts deserve every bit of the water quality and technical resources that folks who live in densely-populated urban centers do. we look fourth wisdom in helping us understand these issues. thanks again for your work on this issue.

with that i would like to yield to the vice chair for the remainder of my time. >> thank you, mr. chairman and i appreciate you holding this hearing on the needs of drinking water systems in rural and smaller communities. like you and many other members of congress i represent a rural district where many of my constituents get their drinking water from smaller cities, towns and water associations. according to the national rural water association more than 90% of the community water systems across the united states serve a population of less than 10,000 individuals. these smaller communities do an incredible job of providing our constituents with clean safe drinking water but are often at a disadvantage because of economic scale and need for more technical expertise. i know this is an important issue to you, mr. chairman, and the ranking member and i thank you for the opportunity to continue working on legislation to ensure our constituents get

the help and clean water they need. i would like to say welcome to my fellow mississippians and providing their insight to the subcommittee today. mr. chairman, thank you again for your commitment on this issue and i yield back. >> gentleman yields back the time and i have a remaining minute left. chair now recognizes the ranking member of the full committee. >> thank you. good morning to our witnesses and thank you, chair for holding this important hearing on what is a very vital topic, and appreciate the opportunity to work in partnership with our vice chair harper as we address an important phenomenon for all of our communities across the country. we've heard the often repeated statistics about rural and small water systems. more than 94% of the 150,000 public drinking water systems in the united states serve fewer than 3300 customers.

although small systems dominate in numbers they serve about 8% of our population overall. but to households and businesses across this great country the key feature they are interested in is not the size of their water utility. it is reliable daily delivery of safe clean water at an affordable price to their homes and businesses that matters. we will hear from managers of these small systems here this morning. and what we will hear is that they cannot simply pass all of their costs for technical assistance, infrastructure repairs, tapping into new water sources or keeping pace with drinking water regulations on to their customers with ongoing rate increases. the rate bases for these small systems are too small to cover the costs of these essential materials and services. it's long pastime for us here in congress to provide robust financial support for our water

utilities. in addition to superreport through traditional funding mechanisms, the srf and grant programs we should also examine alternative financing mechanism, new technologies and potential new partnerships that will enable every dollar to go forward in reducing the backlog of its infrastructure projects and in ways reduce operating costs through efficiency both water and energy. i am very pleased to have mayor keegan here to represent the small water utilities that serve people throughout our state new york. mayor keegan and our witnesses from representative harper's district in mississippi will provide us with a glimpse of the challenges they face each and every day and their efforts to deliver clean, safe drinking water to their public. they do a remarkable job in keeping clean water flowing to every home every day. water infrastructure is essential. it's the only way to state it. we can afford to do this. we cannot afford to delay these

investments any longer. public health, community viability and economic vitality all rest on the foundation of a sound infrastructure. we cannot maintain global leadership and compete in a 21st century global economy with 20th century infrastructure held together with the hope and a prayer. we have an excellent panel with us today. thank you for taking time away from your important work and busy schedules to be here to do your messaging this morning. and thank you mayor keegan, mr. newman, mr. salmon and mr. stewart for the expertise and dedication you'll demonstrate to your communities that you demonstrate to your communities each and every day at work. i look forward to your testimony and to working with each and every one of you as we move forward. i'm pleased to be working with the chair of the subcommittee wasn't our vice chair representative harper and other members of the subcommittee on this very important issue. with that i thank you.

and mr. chair i yield back. >> gentleman yields back. looking to the republican side anybody seeking recognition. chair recognizing the chairman of the full committee. >> customers of all public water systems large and small wealthy and disadvantaged deserve safe and affordable drinking water. unfortunately public water systems across the country are facing staggering infrastructure replacement costs and emerging threats including climate change. resources is essential to any conversation about safe drinking water. much of our nation's drinking water infrastructure is well beyond its useful life and in desperate need of replacement. investing in drinking water protects public health creates jobs and boosts the economy. this is particularly important in the case of small and rural systems which even minor projects can be unaffordable and i thank the chairman for calling this hearing to examine the challenges these systems face.

in 1996 this committee passed amendments to the safe drinking water act that set a number much programs intended to help small and rural water systems. those programs focus on capacity development, operator certification, infrastructure funding and technical assistance. all of them are der signed to ensure that customers of small systems receive safe and affordable drinking water. the small pot of money set aside for technical assistance distributed through grantees such as the national rural water association and rural community assistance partnership have been incredibly important for small systems and i'm glad that both groups are represented to discuss any changes that might be needed to strengthen the program. i expect we'll hear the need for technical assistance far out paces the funding available and i hope my colleagues on the other side of the aisle will join with us to ensure this program is given sufficient funding to meet the requirements of small systems. the same is true for the drinking water. if we want to ensure that small

and rural systems are providing safe and affordable water we should reauthorize the whole srf not just the technical assistance piece. the technical assistance piece is less than 2% of the whole pot. so we should not lose sight of the bigger picture. for disadvantaged communities, the amendment allows states to provide additional support through the srf. for disadvantaged communities states are authorized to provide zero interest loans or principle forgiveness. for systems with small customer bases this is important. unfortunately states are not currently required to provide the assistance to disadvantaged communities and not aldo. the assistance may become scarcer in coming years as the need continues to grow faster than the available funding. when this subcommittee with legislation addressed toxic algae i expressed my hope it would be the start of broader

waterwork and the chair is addressing another important issue. but as i said in the toxic algae, small systems serve only 8% of the population. we should absolutely do what is necessary to ensure they have safe water but should also protect the other 92% and that means reauthorizing the srf, ensuring fracking is done safely addressing drought and planning, of course, for climate change. i look forward to more drinking water hearings and more bipartisan conversations about some legislative solutions. thank you, mr. chairman. >> gentleman yields back his time. now the chair would like to welcome our panel. i'll introduce you one at a time. your full record submit forward the record. you'll have five minutes. again we expect votes between 10:45 and 11:15. i think we'll get through opening statements. with that i would like to first recognize mr. afreddo gomez

director of the natural resources and environmental area for the government accountability office. welcome, sir and you're recognized for five minutes. >> thank you, mr. chairman. good morning everyone. ranking member tonko and members of the subcommittee. i'm pleased to be here today to discuss the infrastructure needs -- >> could you pull that a little bit closer and for our other panelists there's a button in the middle. hit that button when it's time to speak. thank you. >> thank you. i'm pleased to be here today to discuss the infrastructure needs facing rural communities across the nation, particularly for drinking water systems. the u.s. faces costly upgrades to ageing water infrastructure. the demand for drinking water and waste water infrastructure projects in communities with populations of 10,000 and fewer is estimated to be more than 190 billion in coming decades. my statement today summarizes the results of our reports on rural water infrastructure. i'll focus on two main areas.

first rural agencies funding for drinking water. and waste water infrastructure. issues affecting rural communities abilities to obtain funding for this type of infrastructure. first, federal agencies administer programs that can provide funding and technical assistance to rural communities to help them build drinking water and waste water systems anticipate comply with federal regulations. epa's drinking water and its clean water state revolving fund programs known as the srfs provide the most funding totalling 970 million and 1.5 billion respectively in fiscal year 2014. states are required to provide at least 15% of the drinking water srf funds to water systems that serve 10,000 people or fewer. the department of agriculture's rural utility service program is the next large evident at 485 million in fiscal year 2014 all of which goes to rural

communities. some of the other agencies that can provide funding to rural communities include the department of housing and urban development, the economic development administration, and the bureau of lessreclamation. they have varying eligibility criteria. it's based on population size, economic need and geographic location. second, our previous report found several issues that affect rural communities ability to obtain funding for drinking water and waste water infrastructure. these issues include financing technical expertise, and agency coordination and both mr. chairman and ranking member tonko and others have noted these challenges. with regard to financing, communities typically did not have the number of users needed to share the cost of major infrastructure projects while

maintaining affordable user rates. in addition rural communities generally have limited access to financial markets restricting their ability to use fwonds raise capital. as a result these communities depended heavily on federal and state funding. rural communities also did not generally have the technical expertise to rebuild or replace their drinking water and waste water systems. we found they had few staff and often higher consultants and engineers to help them design projects including preliminary engineering reports, plans and environmental documents. agencies provide for some technical assistance that communities can use. lastly we found that federal communities face potentially duplicative application requirements when applying for multiple state or federal programs. this included preparing more than one preliminary engineering report and environmental analysis which likely made it

more costly and time consuming for communities to complete the application process. we recommended several actions to improve coordination among the agencies and programs. in response as of february 2015 epa and the department of agriculture have developed a uniform preliminary engineering report template that applies to multiple programs. seven states have adopted the template for their use. epa and usda have also begun taking steps to develop guidelines to assist states in developing uniform environmental analysis. in summary, the nation's drinking water and waste water infrastructure needs are large and funding them will be challenging. rural communities face additional challenges in funding their infrastructure needs, given the financial, technical expertise and coordination challenges they face overall. federal agencies with states

should consider how to ease communities efforts to be taken funding provided technical assistance and better coordinate agency efforts. mr. chairman, ranking member tonko that concludes my statement. i'll be happy they answer any questions. >> thank you very much. i would like to recognize mayor joseph keegan mentioned by my ranking member mr. tonko. i see it's castleton-on-the hudson. i know it. the west point school for wayward boys. my alma mater. i know the river and valley real well. welcome and we're glad to have you recognized for five minutes. >> thank you. good morning mr. chairman and members of the subcommittee and my congressman, good morning, congressman tonko. i'm mayor keegan of the

castle-on-the hudson. my village is a member of the new york rural water association a nonprofit associate of small and rural communities throughout the state to somewhat responsible for my appearance here today. i got a call from the association on monday asking about my availability and i happened to be traveling back to castleton last night for a trip related to my day job. my village is typical and representative of communities that have water supplies in new york and the rest of the country. according to the u.s. environmental protection agency the state of new york has 2305 community water systems, 88% serve populations under 3300. all of them small community and sewer utilities have to comply with the same regulations testing and certifications as the biggest cities. we have to operate, maintain and update our water infrastructure with very small budgets. as a small community mayor my

number one concern and worry is drinking water and number two is waste water. everything else is a distant third. if there's a problem with the drinking water it has to be addressed immediately. middle of the night, middle of the winter it doesn't matter when. every citizen and especially the most vulnerable depend on the safety of the water including families with infant schools nursing homes and people with compromised immune systems. we can't have any contamination of the drinking water. our sewer system needs to function properly to avoid possibility of a sewage spill or back up in people's homes. this does keep me up at night. congressman tonko knows our part of the state is buried in snow. last week the frost penetrated the ground so deeply we experienced two ruptures in our water mains that are five to six feet underground nicole politzi

force -- this forced us to ask schools to cover water off and on the insurance. i called >> we're wait forge the all clear results to lift the boil water. we ask congress to help us protect the public in successfully operate the public drinking water and waste water supply through the various funding programs and the on site technical assistance initiatives. my village relies on this assistance. i want to thank congressman tonko for supporting the act of 2014 in the last congress. it enhances the current drinking water state revolving fund by further targeting the funding to

communities most in need. we do need help. everything from financing regulation compliance and various programs are very complicated for small communities. we don't have financial professionals on staff and often don't understand many of the funding processes. we currently have needs approaching $3 million for our waste water system. we need new aeration tanks. our system is over 30 years old. we need to stop rainwater from leaking in to the system and over taxes our facility. i'm explained for the need for these upgrades and possible failure. however we don't really have a way to finance it. it would triple the sewer rates to take out a loorn for that much. you can see the picture in the back of my testimony we have old pipes that need updating or replacing at a substantial cost. the one in the picture is stwampd the date from the 19th-century and still in the

ground. we're concerned without more water line replacement we're vulnerable to more breaks and crisis. you can see the other picture of a pipe recently dug up that's loaded with corrosion and deposits. in my remaining time i want to emphasize the essential assistance we sfref the new york rural water association. and explain why it's so helpful. the association has circuit riders that are on call throughout the state that will come and assist us immediately including evenings and weekends. they are experts on the technical side of water operations. just a week ago we called for help for locating a water leak from a ruptured pipe that could have occurred over any part of 100-foot water line. the circuit rider has specialized equipment that can detect noises and vibrations under ground. in addition my operators 1r0e69% of the training needed to retain their operator's licenses from the new york rural water association. we depend on them just like

every other small community. mr. chairman, i have a lot more to say but you've been very charitable with your time. on behalf of every small town elected official we're grateful. thank you from hearing from us and i'll answer any questions later. >> thank you very much. my district mostly has communities below 2,500 people. thank you for those comments because hopefully they are paying attention. those bells signal that we have been called to vote early. i think we'll just break here. we as a congress, i don't think will be in a hurry today. so we'll most of us will get back here and hear the final testimony and go into questions. with that i'll recess the hearing. [ hearing recess ]

we'll call the hearing back to order and now i'll turn to mr. k.t. newman on behalf of the rural water association. circumstance you're recognized for five minutes. >> good morning mr. chairman and members of the subcommittee. thank you for the opportunity to testify here today. my name is k.t. newman and i have been working for or in small and rural community water systems in the mississippi delta for nearly 20 years. i first started out as a small city water manager in my home

town of baden, mississippi which has about 1,000 homes. i then worked for the mississippi rural water association as a circuit rider for ten years. in this capacity i visited every one of the delta's approximately 500 small communities to help them with their water and sewer problems. currently i am working for about two dozen small delta communities assisting them with their water and sewer utilities. i am honored to be accompanied here today by the mayor of one of these small towns, mayor everett hill. the town of komo has a population of 1,200 persons. the mayor challenges are compounded by the fact that as a small town mayor he has a full time job as a truck driver. and has to handle much of the city's issues on its free time. his community has little professional staff because they simply can't afford it. in komo the waste water system is failing because of its age

and inability to meet its current epa treatment. the cost to update the sewer system is approximately $2 million. the komo drinking water system needs an additional $1 million in upgrades. the town was recently fined by the department of environmental quality for failure to comply with their waste water discharge permit. currently the komo waste water treatment facility is actually discharging only partially treated waste water due to failure of the current treatment works. komo is just like thousands of other small communities in the delta and other states. they need a grant rich infrastructure program like the usda's rural development program and they need access to someone that can trust for technical advice, on site assistance and help with managing the funding application process. mississippi has 1234 regulated

public water systems. only two serve populations over 50,000 persons and only 59 serve populations over 10000 persons. more training needs to problem provided to small town mayors like mayor hill so that multimillion dollar upgrades that will most certainly tax the ratepayers of these communities can be more readily understood and communicated to these residents who will ultimately be responsible for bearing the financial burden. recently many of the small communities in the delta have received violations for a relatively new epa regulation referred to as the disinfections by products rule. it's as a result of disinfected water to make it safe to drink. if these small communities limit or reduce the disinfectant limits of the water they will comply with this epa regulation but the water may no longer be safe to drink. once the disinfection by product rule is violated many small

communities are forced to spend limited resources to report these violations to the consumers. in the time of shaw, population 1900 persons, the community was under a boil water order for over six months because of a broken chlorinator needed to disinfect the water. local schools had to buy bottle water for six months. after they called the mississippi rural water association circuit rider, tom aber abernathy they were able to revise the town's billing program, come up with a plan to pay for a new chlorinator and receive the payment, train the new mayor and town council. get the town's credit staple and secure emergency state revolving fund financing. in closing, whenever a small community is facing a compliance

issue, the complication avenue epa rule a line break that they can't find that is causing information lose water service and emergency from a storm or power loss we all call the circuit riders to tell us what it means and what to do. they have developed a trust relationship with small communities in their states that know how to fix things and are willing to come to your town day, night or weekends. thank you for the opportunity to testify here today. mayor hill and i are available for questions. thank you. >> thank you very much. we will mayor hill. good to have you with us also. i would like to turn to mr. bobby selman on behalf of the mississippi rural water association. you're recognized for five minutes. thank you. >> good morning, mr. chairman and members of the subcommittee. it's an honor to appear before you today. my name is bobby selman. i'm a certified drinking and

waste water operator in mississippi. i have been working in the water world for 25 years. starting in my home town in lawrence county. i still work for the lawrence county water authority in addition to 12 other small communities. i want to thank my congressman greg harper for his support and assistance to over 150,000 small public water systems across the country sponsoring the grassroots rural and small community water systems assistance act. representatives harper's bill directs the u.s. environmental protection agency to prioritize the type of technical assistance that small communities find is most beneficial. the rural water type of on site technical assistance is what all the small communities in mississippi and the other states rely on for help with compliance operations emergencies, line breaks loss of water setting rates and training for operator certification. i'm told that congress funds the

epa's internal management budget by hundreds of billions of dollars. small rural communities want congress to know the only benefit we gets comes from a small portion of epa funding that comes from on site technical assistance what we call circuit riders. what small communities do when they have a question or water issue is call their local circuit rider they know trufrt and know can give them clear answer. these circuit riders often come immediately on site to small communities and teach them,000 fix their problem. there's just no one on the field at the local level providing this essential help. after katrina two of my small communities were devastated. each served approximately 2,500 people and they were without power and water. people in communities can get by without power for a while. but not without water. i called the mississippi rural water association circuit riders and they found emergency generators for me and delivered

them to the communities at no charge. since the circuit riders know everybody in the state they were able to borrow some generators from northern communities not impacted by the hurricane and had the generators delivered to get the drinking water and sanitation restored immediately. the circuit riders also had the technical know how to rig the generators electrical system and even drive a backhoe if needed to clear the streets. all of this type of assistance is essential to restore water supply in an emergency. i call the circuit rider to help me out at a community of about 1,000 homes to find a line break causing a loss of water for many homes. the circuit rider came with advance radar equipment that can precisely identify the location of the break, which on this day happened to be out in the woods. finding the circuit riders congress is allowing all small and rural communities to share this technical resource that no one community can afford on

their own. we think it is the best use of our federal water environmental dollars. with the certification under the safe drinking water act of 19961996 state rural water associations have become the main source of training for operators and a main source of continuing education credits which are needed every year to maintain this certification. many parts of rural america have seen interest move on leaving behind depressed economies. in my region the garment industry moved south after nafta. when this happened raising rates becomes overly burdensome. in the town of new hebron, mississippi with a town of just over 400 people we're now being told we need to comply with a new epa waste water discharge permit that will cost 2 to 3 million dollars. i will close with some comments on the federal water infrastructure programs. namely the epa state revolving funds and the usda rural development grant and loan program. we are very appreciative for

congressional funding of these initiatives. and realize funding constraints in congress and the nation notwithstanding the curtailment of federal funding, the regulatory burden continues into crease and become more complex. we urge you to emphasize grants in these funding programs. low interest loans don't help the communities facing a severe hardship from federal compliance leaving the loan funds to be used for compliance with greater availability to afford financing. we are very grateful for the funding assistance. it has allowed many rural and small communities to have access of drinking water and sanitation that would otherwise not have been able to afford without the federal assistance. and we want to be partners in the effort to make the initiative as efficient and as successful as possible. thank you very much, mr. chairman, and i'm eager to answer any questions at the appropriate time. >> thank you very much. our last but not least. panelist is mr. robert stewart

who is the executive director of the rural community assistance partnership. welcome, sir, and you're recognized for five minutes. >> thank you, chairman shimkus. ranking member and members of the committee. i think the previous witnesses and y'all have done an excellent job at sort of framing the issue. as someone that has worked 20 years with hundreds of communities in texas both for the rural community assistance partnership and the rural water association and someone who has directed the national program for ten years i'm here to tell you that the needs of small communities are many. the resources are limited. the dedication and determination of small communities to provide their citizens with the best possible water is strong and undiminished undiminished. i'm sure everyone knows a little about the rural community assistance partnership. it's in my testimony. i won't repeat things that are in my testimony. i just want to make a few points that have been touched on but maybe i could amplify a little bit. one is the access to capital.

there's a real issue in accessing the resources they need to extend lines to new customers. i believe mr. gomez talked about access to the municipal bond market. for small communities thns an option at all. 53,000-some community water systems in this country. perhaps 4% of them have the ability to access the municipal bond market. so what they are left with is the two primary federal financing programs being the drinking water srf and usda rural developments. rural and environmental programs. it's really critical that those programs continue to be supported in a robust manner. we work a lot with rural development and their water environments program. they are the primary lender in rural communities. they have some 18,000-plus loans out with small water systems. and as you probably know there's virtually no default on these loans. we take these matters very

seriously in repaying the loans that are made to small communities. one of the things r.d. has going for them is they have field staff never state. theft ability to work directly with the communities. the communities know their local folks in the district and state offices. it's more a cooperative easier way to get funding through rural development. rural development also funds the rural water association and rcap for technical assistance and training. a lot of the staff that work for me around the country work through the application processes and all the requirements that are needed in order to get a loan from rural development. epa state revolving funds are also a very important part of the financing scheme for small communities. as a result of the 1996 amendments to the safe drinking water act, the state revolving program was formed and it was mainly to deal with compliance issues. if you look at who is out of compliance and where the most

health-based compliance issues are, 96% of those are from small communities. you would think that most of the money, a big portion of the money would go to the communities whether they're urban, rural small or large that have the compliance issues. but as you can look at epa's own numbers, perhaps 25% of the funding actually goes to the small communities in this country. we would think a larger amount of money from the srf program should be dedicated to economically disadvantaged and small rural communities. epa does have a program as a result of the 96 amendments that funds the technical assistance kind of program that both rural water and rcap have taken advantage of. it's not funded at the authorized level that was was authorized 20-some years ago. we hope you would consider some additional resources for that particular program. what else can be done? what else can we do to work with small communities? there's a lot of other options.

one of which both rural water and rcap work on is sharing of services, how can small communities get together, share an operator, share a manager, share purchasing. how can we look at possibilities of combining systems if they're close? it's very difficult. and one of the problems the funding agencies have is it's easier for them to make a $10 million loan than 10 $1 million lens. that hurts smaller communities even more with reduced staffing levels in both epa and r.d. there's a emphasis for the larger loans which adversely affects small communities even more. the regionalization approaches where appropriate is important. but the only way those are going to happen is if you have people like the circuit riders and the technical assistance providers for rcap that are out working with those communities on a day in day out basis to work through those issues. one of the things rather quickly because my timetion running out is you talk about tools. i'd like to give credit toechlt

pa for developing the variety of tools and working with rural development on tools. asset management tools tools to look at sustainability for communities. again, tools are important to be developed for use by small communities but it takes someone in the field like a rural water or an rcap person to bring those tools out to these communities. maybe this could be handled in the questions. i know you're interested in wifia and some of the other alternative financing programs. i'd be glad to talk about that also. my time's up, though. so i really appreciate the opportunity to be here with you today. >> thank you very much. and i'll recognize myself for five minutes for starting the questioning. before i start, i'm in my 19th year. my first district was 19 counties. my second congressional district was 30 count why's. and now i represent 33 counties out of 102. we have really been able to access and use the usda rural development and rural water and

it's helped force a push to realism and closing the gaps of water or addressing the challenges small communities have because they just -- in rural america sometimes these communities are shrinking. they're not growing. they're shrinking. so they're based to keep up especially with new capital expenses. that's in my area. it's been a very, very successful program. and i just throw that out because i have great people work on that and they've done great work. i'd like to go to mr. gomez first. you've heard some of our witnesses claim the drinking water state revolving funds are not being made available to provide safe drinking water to the needs of our most needy xhunds. is there a way to measure across the country whether the drinking water state revolving fund is immediating -- its

congressionally intended purpose or authorized purpose? >> that's a really good question. what we are aware of is the drinking water srfs are required to provide 15% of the funds to the small communities. the extent to which states are doing exactly what you're asking we don't know yet. that would be a good question. possibly for gao to look at. there are estimates from epa, for example, that about 38% of the drinking water srfs have gone to small communities. as of 2008. that's the estimate that's out there. but to the extent that it's meeting small communities' needs we don't know that. >> great. well, thank you. are there any reports that show how fast this drinking water funding is spent, by whom and where it goes including distribution to the neediest communities? >> so one of the things that we are doing at the moment is we do have ongoing work looking at the financial sustainability of the

drinking water srf. there we are looking at different ways in which states are managing these srfs and we're hoping to identify best practices that states are using. that report should be coming out this spring. >> great. thank you. mr. stewart, in your testimony you state that epa state revolving fund needs to be and i'm quoting better managed to meet small system needs. can you elaborate a little more on that? >> when you look at the numbers, epa has a difference in between the number of loans they're making and the amount of the loans they're making. so the amount of the loans is not sort of the same as the number. not as much actual money that's going in there. the whole purpose of srf was to give the states latitude to run it how they see fit. i think most of the members of this committee would sort of agree with that because the conditions are different from state to state.