good morning. today, we will discuss the need to modernize our nation's infrastructure and president trump's plan for rebuilding infrastructure in america. this committee has historically taken the bipartisan lead on infrastructure issues in the senate. i'm very pleased that secretary chao and assistant secretary james have come to our committee first to discuss the infrastructure principles shared by president trump on february 12th. our infrastructure drives the health, well being, economy, and prosperity of the nation. we depend upon it to move people and goods to get to our jobs, to protect our homes from floods and disasters, and to provide our families with clean water. for too long, we have not

prioritized the needs of these infrastructure systems. funding has not kept pace with our infrastructure needs. and burdensome federal regulations have slowed efforts to spend the money efficiently. the time has come to make a significant investment in our roads, bridges, ports, and water systems. the administration's plan proposes to spend hundreds of billions of dollars of federal money to generate well over $1 trillion of infrastructure impact. part of this can be accomplished by cutting washington's red tape. presidents trump -- president trump's plan prioritizes streamlining. this will allow needed projects to start quicker and finish faster for lower costs. as states, counties, and towns wait to obtain permits from washington, costs for projects rise and time is wasted. shouldn't take a decade to permit a project that takes only months to build. we need to speed up project delivery.

the president's plan calls for a two-year or less limit for federal approvals on projects. that's a common sense approach. only in washington is two years considered a quick turn around. we need regulatory streamlining so we can build these projects faster, smarter, better, and cheaper. the president's plan also makes the infrastructure needs of rural america a priority. the significant portion of the federal money proposed in the president's plan is designated specifically for rural states. rural communities need to have an equal seat at the table as we address infrastructure needs. what works in baltimore or chicago may not work for smaller communities like cody, casper, or cheyenne, wyoming. we need an infrastructure plan that includes projects for both. better roads and water systems across america help us all. everyone benefits from safer highways and dams in rural

communities. any plans should have significant and sustained funding levels for rural areas. on the environment and public works committee, we are making good bipartisan progress on legislation to address america's water infrastructure. we're working side-by-side on water infrastructure legislation that we plan to pass later this year. we need to expand that bipartisan cooperation to roads and bridges as well. america prides itself on its ingentlemen nuni ingenuity and commitment to provide for the needs of its people and i believe we can work in a bipartisan way on legislation that will make our infrastructure even better. that process begins today but hearing more about the president's plan. so i'd like to welcome and thank both secretary chao and assistant secretary james for joining us today and for the insights that they will provide for this committee. i'd now like to recognize our ranking member, senator carper, for his remarks. >> thanks, mr. chairman. good morning. it's great to see our secretary

and i want to be able to be among the first to congratulate our new assistant secretary with the army and thank you for your willingness to serve. we look forward to working with you. it's been a joy, actually, to work with you through the confirmation process, both of you. so welcome, we're glad to see you. disappointed to learn that administrator pruitt is unable to testify today but despite the epa's important role in the improvement of and development of drinking water and waste water, infrastructure, having said that, we're delighted that the two of you are here and thank you for joining us. as we consider a potential infrastructure bill that's helpful to hear from you and we're glad to receive the administration's proposal next month. my statements will largely be up to congress. it's up to you. it's up to the two of you as well. it's up to the administration. it's up to a lot of people. this is a shared responsibility. a big part of it is on us and we have pretty good working relationship here and hopefully that will help us along the way.

one thing i believe the chairman and i -- -- we agree on a lot of things. we agree on the need for the federal government to be a good partner to states when it comes to investing in our infrastructure. as a former governor and state treasurer, i know that we can -- it's hard to ask a state that's used to an 80 cl/20 funding formula, hard to flip that and go from 80/20 to 20/80 where the states are expected to put up the 80%. that's hard to make up that slack. and some of us in the senate met with a bunch of governors that are on capitol hill this week and we had a good conversation about this and they are concerned and you might imagine why. they are not anxious to accept a kind of deal. i think folks in wyoming and people in delaware would be reluctant to take that deal too. it's one of the -- a number of places where i think the

administration's plan, at least their math doesn't add up. last week, up the road in philadelphia, university of pennsylvania, modeled the administration's proposal. in fact, they've been modeling it for a while. they found out that at most spur an additional $30 billion in state, local, and private infrastructure spending. think about that. an additional $30 billion in infrastructure spending. that's a far cry from what the administration is promising and i think the president on the campaign trail basically saying we're going to put $1 trillion into infrastructure and folks up at university of pennsylvania wharton school of business are saying, i don't think so. i'm concerned about the administration's proposals to give money based on nonfederal money they would raise. i think there's something to be said for more money for -- to incent the leveraging of federal, you know, nonfederal money with the federal money, but project quality has to be

among the considerations. does this make us safer, reduce pollution, make it easier for us to get from place to place. particularly disappointed to the degree the administration is focusing on sweeping rollbacks to our nation's bedrock environmental protections. simply gutting environmental protection does not always achieve time savings. in fact, i think it rarely does. in doing so, we potentially put our communities at risk and can deprive the residents who would be most affected by these projects from making their voices heard. there are any number of ways to speed projects. we were able to do those without environmental harm, including many that this committee helped to enact into law and that this administration is choosing thus far not to implement. for example, we could ensure that permitting agencies have enough funding complete reviews quickly. or we could enhance coordination tools and implement new authorities that congress has already passed in 2020.

unfortunately, the administration has done the opposite, proposing to cut permitting agencies' budget and to slash funding for the department of transportation's infrastructure, permitting, improvement center by two-thirds. that doesn't really speed us up. that doesn't give us the exat the indictment-- exat thpedited want. i'm told that no executive director of the permitting improvement steering council has been appointed. it's been three years. three years. major rule makings at d.o.t. or implement streamlining provisions or the f.a.s.t. act that many of us have supported have not been finalized. it's been three years, in some cases five years, six years. frankly, one of the best ways to speed up projects is to provide long-term funding and program certainty and to make grant awards in a timely manner. time and again, these research

has shown that inadequate funding, listen to this, time and again, research has shown that inadequate funding is the most common factor delaying water and transportation projects. unfortunately, so far, this administration is holding up grants and delaying funding decisions. d.o.t. released a funding notice for the infra-grant program eight months ago but still had not awarded the $1.5 billion that congress provided for that program. it's been eight months. in the first three quarters of 2017, epa awarded only a third as much grant funding as the agency awarded over the same period of time in 2016. department of transportation's 2019 budget proposed cutting funding for all new transit capital projects, to cut amtrak funding and just end the tiger program. for an administration that's allegedly interested in efficiency and infrastructure, we are too, it's frustrating to see so many critical programs being cancelled, mismanaged, or

underfunded. and it's particularly hard to take this administration's proposal to spend $200 billion on infrastructure seriously when that proposal is paired with a budget that would cut $240 billion from existing infrastructure programs. instead of funding our nation's aging water infrastructure, the president's fy19 budget proposal for the corps of engineers led by mr. james here is secretary james, is down 4% below the fy18 request for the first time in 20 years, the president's budget for construction is below for this important entity, $1 billion. and in addition to these budget cuts, the administration authorized no new starts in investigations to fund project studies and no new starts in construction. thus kugt off the pipeline for new corps of engineer projects. these cuts are disturbing given the courts back willing and i mentioned this, madam secretary, two weeks ago with our meeting

with the president in the white house. the court's backlog is $96 billion and growing and my understanding is that we're look at a budget proposal around $6 billion. we got a backlog of $96 billion and a budget proposal partnof $6 billion? that's going to be a while. worse, the proposal would shift the burden from financing these projects almost entirely on to local stakeholders. can some of them do more? you bet. but we've got to be realistic too. our country depends on water infrastructure investments in part because such infrastructure helps to expand our gdp. we need to do that. each federal dollar spent on civil works program generates $5 in revenue not u.s. treasury and $16 in economic benefits. the current budget proposal ignores the inherent federal role that the corps plays in our economy. the administration appears to

ignore these clear benefits in gop developing their budget proposal while selectively using a benefit to cost ratio to kill nationally significant projects. in closing, let me briefly discuss revenue. secretary chao, when you testified before us last may, you told us that the administration's infrastructure task force was looking at two issues, permitting and pay force so i was surprised when i finally saw that the administration's plan devoted 15 pages to permitting while the word pay for failed to appear even once. even once. maybe i missed it but i don't think so. my colleagues have heard me say more than a few times, if things are worth having, they're worth paying for and for decades, we've relied on a user fee approach to pay for our transportation infrastructure, roads, highways, and prij bridges. in the years to come, we'll see a growing number of electric and fuel cell powered vehicles on our roads that do not use gasoline or diesel fuel. in anticipation of that program, we adopted legislation that

called for a multistate pilot of alternative revenue mechanisms to fund roads in america. we call it vehicle miles traveled. or words to that effect. in oregon, it's the road user chart but over the next several years, we should grow the number of states in the pilot and eventually run a national pilot that funding approach. eventually, we're going to morph away from taxing gas and diesel. we have hydrogen powered vehicles on the road. eventually we'll have electric powered vehicles. they're not going to buy diesel or gasoline. we need to make sure they're paying their fair share. uf unfortunately, that proposal is still a few years away. meanwhile we have a growing shortfall in the highway trust fund to address. fortunately several of us were in the meeting that i alluded to earlier with the president and our secretary last month when he repeatedly declared support for increase in gas tax. that could be one important additional source of funds to help us pay for the improvement we need. at first i thought he was kidding us, but he wasn't. i talked to you later and he

indicated he had been talking about this for weeks and it's in -- something like 4 cents a year increase in gas and diesel tax over four years and that's going forward. presented that to the president two weeks agos you recall, he said, that's not enough. we need to do more. we need to do 25 cents and we should do it now. he said he would give us air cover, political cover, and i thought, god bless you, and if he's serious about that, if he's serious about something along those lines, we can do a deal here. we can get this show on the road. finally, i believe there are others as well who would find that that bipartisan support. with the administration's support and the president's promised leadership, i hope we'll be able to find agreement for a much-needed source of new revenues to fund our criminal infrastructure needs while we also pursue other promising ways to get better results for the transportation dollars we spend and those 15 pages i talked about, there's some good ideas there. there's some that aren't but there's good ideas there too. i understand figuring out how to pay for things is always the

hard part but we weren't sent here to just tackle the easy things. we were sent here to do tough things and have difficult conversations and make tough choices to have better outcomes. i heard yesterday that our colleague john cornyn, with whom i was in the gym this morning, told some folks in the press that he doesn't know if congress will have time to do something on infrastructure at this -- in this session. i gasped when i heard that shared with me by a reporter the other day and i talked with senator cornyn about that today and he does -- he seemed to -- didn't think he'd said that. and that's great. i hope he didn't. because we got plenty of time. and we sure ought to have plenty of time to do infrastructure and transportation and that's what people sent us here to do. they want us to do the hard things and if we do, with apologies to mark twain, we will amaze our friends and exxconfou our enemies. let's do both. thank you very much. >> i would like to welcome our guest, the honorable elaine chao, the secretary of transportation and the honorable

r.d. james, the secretary of the army for civil works. your full written testimony will be a part of the hearing record. please keep your statements to fave minut five minutes so we have time for your questions. i look forward to hearing your testimony, beginning with secretary chao. >> chairman, thank you for the opportunity to be here. infrastructure is the backbone of our world class economy. it's the most productive, flexible, and dimiynamic in the world. with respect to service transportation, traffic congestion and delays cost drivers nearly $160 billion annually, about one quarter of our nation's bridges are structurally deficient or in need of improvement. more than 20% of our nation's roads are in poor condition and the transportation needs of rural america, which account for disproportionately high number

of our nation's highway fatalities, have been ignored for too long. that's why 12 agencies have been supporting the president on a comprehensive infrastructure proposal which the president announced as a priority in the 2018 state of the union address. transportation is one component. the initiative also includes but is not limited to drinking and waste water, energy, broadband, and veterans hospitals as well. it's designed to change how infrastructure is built, financed, maintained, in communities across the country. the goal of the president's proposal is to stimulate at least $1.5 trillion in infrastructure investment, which includes a minimum of $200 billion in direct federal funding. the guiding principles are one, use federal dollars as seed money to incentivize infrastructure investment, two, provide for the needs of rural

america, three, streamline permitting to speed up project delivery, and four, reduce unnecessary and overly burdensome regulations. in addition, the key element of this proposal is to empower decision making at the state and local levels. they know best the infrastructure needs of their communities. half of the new infrastructure funds will go toward incentivizing new state and local investments in infrastructure and a quarter of the federal funds will be dedicated to addressing rural infrastructure as prioritized by state and local leaders. and as a former secretary of labor, i'm pleased to note that this plan also has a workforce component to help workers access the skills needed to build these new projects. the department is also implementing the president's one federal decision mandate that was announced in august of 2017 to help speed up the delivery of new infrastructure and reduce costs. in fact, the department is working on a new process to handle the permitting of

complicated multiagency projects. to meet the president's new expedited timeline. in addition to permitting reform, the department is doing its part to help grow the economy and create jobs through regulatory reform. costs associated with the new d.o.t. regulations decrease by $312 million in 2017 and the department is on track to decrease these costs by at least $500 million in 2018. by incentivizing new investment on infrastructure, eliminating overly burdensome regulations, providing support for rural america, and streamlining the permitting process, the department is helping to improve our quality of life and build a better future for all americans. this administration looks forward to working with all of you on these very important

issues affecting our country's economy, vitality, productivity, and also quality of life. thank you again for inviting me, and i'll be glad to answer any questions that you may have. >> thank you so very much for your testimony. mr. james, please proceed. >> good morning. mr. chairman and members of the committee, ranking member senator carper, i'm honored to testify for you today on the administration's recently released infrastructure plan and the water resource needs and challenges of our nation. i look forward to working with you to advance the delivery of our nation's water resources infrastructure through innovative approaches and streamlined processes. the army has played a significant role in the development of the nation's water resources of the past. the army maintains our nation's coastal navigation channels, inland waterways, dams,

navigation locks, flood control levies, and hydropower plants. these projects help prevent flooding in our river valleys and along our coast and facilitate the movement of approximately 2 billion tons of water board commerce and also provides 24% of the nation's hydropower. much of our nation's infrastructure is aging, as you know, and requires significant amount of resources to maintain. the traditional approach to constructing and maintaining these projects is not sustainable. the administration's infrastructure legislative principles released on february 12, 2018, provide a common sense approach to address these issues. the legislative principles directly applicable to the civil works mission fall within six general areas. the first is water resource infrastructure. the administration's principles would remove barriers and provide new authorities to

expedite the delivery of infrastructure projects through a variety of mechanisms focused on revenue generation, streamlining project delivery, and innovative acquisition approaches. the second area is inland waterways. for this area, the combination of new and existing revenue streams combined with nonfederal partnerships would enable greater efficiencies and innovations for our nation's inland waterways. the third area is associated with incentives in the form of grants to nonfederal entities. these are intended to encourage innovation, accelerate project delivery, and increase state, local, and private participation. the fourth area pertains to the water infrastructure finance and innovation act. this act provides for incentives in the form of low-cost loans which are intended to encourage innovation, accelerate project delivery, and increase state,

local, and private participation. the fifth area involves environmental reviews and permitting. in addition to broad environmental and permitting reforms, the principles would further streamline the civil works section 404, river and harbors 10, and section 408 programs to timely support decisions while maintaining the environmental protection provided by the law. finally, the last area applicable to civil works responsibility is divestiture. the infrastructure legislative principles authorize federal divestiture of assets that would be better managed by state, local, or private entities. the administration's infrastructure proposal is an opportunity for the army to apply new financing approaches and streamline the processes to meet current and future needs of the nation. i recognize the importance of

streamlining environmental reviews with the goal of shortening timelines to an average of two years while still protecting the environment. in particular, i am looking to eliminate redundant and unnecessary reviews, con curtain soo -- concurrencies and approvals. in addition to the legislation's proposal, i will look at the authorities, policies, and regulations and procedures to identify opportunities for increased efficiency and effectiveness. i want to stop focusing on the process and focus on the results. simply put, the army must ensure that we put the federal funds that we are entrusted with into the ground effectively and efficiently. to me, that's let's move the dirt is the goal. in closing, the time has come

for us to focus on outcomes as we rebuild america. the way that we use our water resources significantly impacts the economic advantage afforded to us by our river systems. it will determine if we protect and restore the capital assets afforded healthy ecosystems and it will determine how we protect life and property from the coast to coast threat of flooding. i look forward to working with this committee in the future to improve the ways that we can invest in our water resources. thank you, mr. chairman, members of the committee, this concludes my statement. i look forward to taking any of your questions. >> thank you very much to both of you. we appreciate you being here today. we have many members of the committee here looking forward to asking questions. before we do that, two pieces of housekeeping. one is in order to assist chairman mccain in his absence, senator inhoff is going to be chairing the senate armed services committee today and i

ask with the permission of my republican counterparts that he be recognized for questions. and the second is that we have a series of three roll call votes beginning at 11:45. it's my intention to complete our hearing by noon in order for all of us to participate in the voting on the floor. with that, madam secretary, thank you for being here. earlier this year, congress passed a budget. as the head of the government department that spends the most federal dollars on infrastructure, would you agree that an extra $10 billion per year would make a zanl differen -- substantial difference to states including wyoming, delaware, and others and is a good start in our efforts. >> there's approximately $4 trillion in infrastructure needs in this country, so every dollar counts. thank you. >> and you know, i was just going to show you a chart. as you can see from the chart,

on average, highway projects take the longest time to complete the environmental impact statements. longer than rail, longer than public transit, longer than electricity transmission. it's the highway project so an average six and a half years. do you agree that streamlining is critical in terms of speeding up the needed investment in our nation's highways? >> absolutely. there are many private pension funds that are very interested in investing in public infrastructure, and yet, in a number of states, the private sector is disallowed from participating in the financing of public infrastructure, so that's one issue. number two, while i see a great deal of enthusiasm from the private sector, pension funds and others, to participate, one of the hardaurdles that they fas the lack of ready projects to be financed. so if the permitting process can be speeded up and also just from a common sense, less

bureaucratic way of doing things, they can be streamlined, it will actually make more projects available for the private sector to invest. >> and mr. james, the committee's held two hearings already this year related to enacting the water resources development act. in light of those hearings, it is clear that the corps needs to have the right tools and flexibilities to carry out water infrastructure projects. if implemented, how would the administration's infrastructure framework ensure that the corps has the proper means at its disposal for important water infrastructure projects? i think of one in wyoming, the jackson hole ecosystem restoration. h how do we make sure those are delivered efficiently, effectively, and at the lowest cost for the american taxpayer. >> mr. chairman, you just discussed with madam secretary the -- the situation that i feel like has held up our way of

doing business in the corps for a long time. and that's the fact of multiagencies overseeing the environmental impact statements as we go through developing those. under president trump's plan, there would be one agency in charge of that, one decision, one agency. the agencies will work together with the understanding that they don't have six years to complete an environmental impact statement. now, as far as the other things that the corps does, part of it's planning, designing, engineering, and then finally getting to contracts and construction. we're trying -- the corps has already internally made great steps and strides toward improving their process. i'm working with general semini and his key staff. we're going to further dig into that and try address that so those processes do not take as

long and what money we are afforded can then be put in the ground rather than in the process. >> all right. i appreciate it. and i appreciate the general being here. you've testified a number of times in front of the committee and thank you for being with us here today to join in the discussion. mr. james, you know, current authorities allow the corps to receive funding from other entities, such as natural gas companies, railroads, to augment existing regulatory resources. it's done so that permit evaluations can be expedited under section 404 of the clean water act, section 10 of the rifz a rivers and harbors act. what benefits do you see if this opportunity were to be expanded to receive funding from any nonfederal entity to augment existing regulatory resources. >> sir, i would like for you to give me the opportunity to let my staff get back with you immediately on that. i have thoughts, but i don't

want to give you the wrong information on that. so, if you will, sir. >> and i would also ask that they also look into, are there additional considerations that would help the corps further expedite the process of evaluating the regulatory permits. >> absolutely. we'll work on that and get back to you and i appreciated that. >> thank you very much. senator carper. >> secretary james, you've been on the job for a short while and you have shown great wisdom in response to that last question. when you don't know the answer, say so, tell them to get back to us. if i could to, secretary chao, i mentioned in my opening statement, secretary, that the folks up at -- up at the university of pennsylvania school of business, that includes an economist up there, that includes a fellow bhowho wa former bush treasury official, they have evaluated the administration's claim that they will produce $1.5 trillion overall and the folks at the

school of business say that the administration's off by 98%. in other words, for every $100 it's claimed it will -- amount of money being generated, funds being generated, from these proposed spendings, $98 will never materialize. other experts, including the heritage foundation of all people, have looked at that report and they say it's spot on. that surprise medicine. so l surprised me. let me give you a chance to respond to these experts. how do we turn that into $1.5 trillion though the states tell us there's cash strapped and we no the vast majority of products to repair or replace infrastructure will not attract private investment. just explain that. >> obviously, we disagree with both the heritage foundation and the wharton institute. it takes people with real live business experience to see how it works. we see it in build america bureau, and also with the rifflongs. we give $1, leverages $14 and

basically in credit and of the $14, it's a 40 times leveraging overall investment spending. so we see it every day in build america bureau. >> well, i'm not from missouri, but on this one, you're going to have to show me. you're going to have to show me. madam secretary, the department elite has a key role in negotiating a win-win situation outcome on the fuel economy and greenhouse gas and tail pipe standards with california and i've been concerned that no real negotiations with california have occurred too date and i'm concerned also about press reports that the administration may choose to weaken the standards far more than any auto maker has asked for. i've asked them all. i've asked like the detroit auto, ten of them, what do you need in terms of standards and they said, not as much as the administration apparently thinks we're asking for. we're not. we need a win-win situation here. there's -- this is just ripe for a win-win situation here and i want to ask for your commitment

to do two things. i don't think they're two difficult things to do. but as a process moves forward, let me ask you to commit to do two things. number one, i've heard that the transportation department and epa staffs are not working as well together as they can and should in this regard. i just want to ask if you will direct your political and career staff to answer all of epa's questions about the transportation department's model and analysis quickly and completely. that's my ask. >> i would be more than glad to answer transportation questions. as for what happens at the epa, i will talk with the administrator but it's up to him. but let me also -- >> i'm not asking -- i want to be clear. what i'm asking for you to ask your political and career staff to answer all of epa's questions, all of epa's questions, about the transportation department's model and analysis quickly and completely. that's what i'm asking. >> i will do what i can, but i do not understand that question. and if it's another jurisdiction or cabinet, i can't make them answer that. but the point is --

>> no. we're asking for your department to answer questions asked by another part of the administration, epa. >> i can't do that. they have to answer their own questions. but let me also disabuse you of the idea that we're not working on this together because we have been. in fact, we've been holding almost daily meetings at the white house with epa, department of transportation, and on this issue, and california. in fact, i've had the acting ntsa administrator fly out to california several times in an effort more on our part, to try to come together and understand and work together with california. so, from our point of view, i feel quite confident that we have really tried. whether california -- >> madam secretary, i'm going to ask you to hold it right there because what i've heard repeatedly from epa, from within the department of transportation, and from the folks in california and the cirb, that there's no active negotiations that are going under way. the kind that you're telling us about is not occurring.

let's have an offline conversation about that. i want to make sure you're hearing the same thing i'm hearing. >> if that's happening, i want to know about it. so thank you for bringing that up. >> last question. previous -- let me see here. we're talking about permitting reform. we've done a lot. we need to do some more. my hope is we'll have an oversight hearing that actually looks back to 2012 legislation. what did we ask for, what's been done, looks to 2015 legislation, what's been asked for, what's been done, but meanwhile, why is the administration -- three questions for the record, okay? why is the administration failed to appoint an executive director to the federal permitting improvement steering council. you had several years to do that. you've had in some cases three years or five or six years. why is the administration proposed to cut the budget for permitting agencies, including the d.o.t.'s infrastructure and permitting improvement center. those are legitimate questions. and we don't have time to respond to those today but

they're good questions and they need to be answered. >> thank you, senator carper. i would like to submit for the record, because the history of these programs have successfully demonstrating that federal funding can be significantly leverage and had we have testimony from jennifer to this committee in july of 2017 and without objection, that will be submitted. >> can i make a similar unanimous consent request to submit the university of pennsylvania school analysis that indicates that only 2% of the money -- >> be more than glad to put my comments to that as well. >> sure. and thank you. >> without objection. senator inhoff. >> thank you, mr. chairman. i appreciate you coming to me. i'm chairing the armed services committee hearing at this time, but this is so significant, what we're doing here, and i'm very excited about it, and i'm very positive about it. and we have been just to clarify, in contact with our committees, the two committees, commerce and environment and public works and the white house, the administration, on

many, many times. we got a good running start, good things are happening. i was encouraged that -- by the president's proposal. i think we all can come together and there's no better evidence of that than joint "wall street journal" article that was written by senator white house and me just last week and i ask unanimous consent that bit made a part of the record at this point. >> without objection. >> no objection here. >> and it was very positive. i'm very serious when i say this, madam secretary, because senator whitehouse is one of the more progressive democrats. i'm a conservative republican. and we agree on this stuff. we think, you know, the american people, there's an old document nobody reads anymore called the constitution. it tells us what we're supposed to be doing here, defending american and they called it post roads back then, and so we have every intention of doing that. the harvard harris poll show that 84% -- 84% of the americans

responded that we need to invest more in our infrastructure and then they go and talk about different methods of paying for all this. now, i do think that when we're looking at this, we need to consider the additional revenue that will be coming in as a result of the increase in economic activity. it works out about, for each 1% increase in economic activity, it develops about $3 trillion over 10 years of additional revenue. this has worked back in the middle '60s with kennedy. it worked certainly with reagan. so that needs to be considered. so secretary chao, we look forward to working with you. our oklahoma department of transportation has shared with me that for each year of delay for a project, 3% cost actually goes up. so timing is important. and when funding is scarce and hard-fought to earn, this can really limit what our states and local entities can accomplish.

i appreciate the administration's recognition of this fact with their focus on project delivery reform. now, we did a great job in the fast tack with a lot of project delivery reforms. it was huge. so we got a lot more miles done than we would have otherwise. at that time, i chaired this committee and we had senator boxer who was the ranking member, and we did accomplish some things. can you -- can project delivery be both timely and environmentally sound? i would ask you to respond on that, if you would. >> of course. out of the 30 different regulations required by the f.a.s.t. act, everything has been done except for 2, and they should be coming out by june of this year. on the other issues about one federal decision, which was announced last august, 2017, this actually addressed more than the f.a.s.t. act. it addresses multidepartmental, multiagency coordination. we are finding that as we go and implement what the f.a.s.t. act

has asked, that there are larger problems about permitting that spans the whole government, which is why we need to tackle the rest of the permitting processes in the other departments on a multiagency basis. >> yeah, and your first response was, people should pay attention to that. we've actually done that. it's been done now. so, we can do it again. secretary james, i do have a question i want to ask you concerning the corps of engineers. however, it's a long one so i'm going to do that for the record if that's all right and mr. chairman, thank you for giving me this priority. >> thank you, senator inhoff. senator merkley. >> yes. thank you, mr. chairman. i wanted to start, mr. james, by asking you about the tribal villages along the columbia river that we've had a chance to talk about before. these are the villages that were flooded by building dams on the columbia river. we rebuilt the city that served the caucasian population but didn't fulfill our commitment to

the native american tribes to rebuild their villages. i think you've indicated some interest in this and some support for this. i just wanted to check in and see if you're -- you are prepared to help champion getting this long-overdue commitment done. >> yes, sir. i do think that's the right thing for this country to do. the tribes that were moved out of their homeland areas and been promised housing in other places, we should do that as a nation. there's no question about that. i look forward to working with you in the future, and we'll help with your efforts in doing that. >> thank you very much. we sure appreciate that. and secretary chao, i wanted to ask you about the basic question of buy american and buy america,

buy american referring to u.s.-sourced steel and inputs for what we build as a u.s. government and buy america, u.s.-sourced steel and other products for projects funded by american grants, u.s. government grants. in his inaugural address, president trump said we will follow two simple rules, buy american and hire american. does the president still standing by this pledge for buy american? >> absolutely. at the department of transportation. >> thank you, because here is the thing. by america is not mentioned at all in your infrastructure proposal. it's not mentioned in the context of the transportation and water projects. it's not mentioned as a requirement in the infrastructure grants. it's not mentioned in the issue of relocation of utilities. it's not mentioned in the requirements for the airport improvement program. and so on and so forth. can you pledge to insert by

american and buy american into these proposals so we will buy american-made steel? >> well, there's an executive order outstanding on january 20th, so i think it's quite clear that that is governed the for that. >> unless it is in the legislation issuing these grants, it won't actually be compelling. i would like to work with you to achieve that vision and objective. >> we are applying to buy america to all these grants. thank you. >> thank you. i appreciate that a great deal. the second thing i wanted to explore is the challenge of whether we are simply moving chairs around on the deck of our infrastructure titan cic. in that regard, i have a chart i would like to show you.

this chart shows that the president's budget is taking $280 billion out of infrastructure. out of new starts, almost 20 billion. out of amtrak, 7.6. army corps of engineers, 14 billion. cdb, 30 billion. home grants, incredibly important. for housing, $9.5 billion. public housing capital, 19. the economic development. aviation, 2.5. rural water, 5.1. these total $280 billion. if we take and look at what's going on, we are cutting $280

billion here and adding $200 billion here. how does that fulfill the vision of an aggressive infrastructure program? >> i think there is a disagreement about the purpose and it's use of federal funding, which is obviously a discussion point for all of us and why we are all here. the numbers that you mentioned are compared to 2018 fiscal year. if you look at 2017, it is actually not a cut. 2018 went up. that's how you consider a cut. that increases a mandatory portion by more than 4%. overall, the d.o.t. budget is pretty much the same in 2019 as well. the $200 billion has been inserted into the infrastructure proposal, which is another part of the overall federal budget. >> i thank you for your answer. i'm not persuaded about it. if appears we are not making the kind of commitment we were intending. my time is up so i will close

with this. folks back homer saying, now, let me get this straight, we take our resources and build something, the federal government put nss in a tiny amt of money and take credit for it. this is the 80/20 versus the 20/80 we heard previously. we don't have the 80% so we will not build under this structure. quite frankly, they consider it a bit of a farce to put in a bit of money and claim credit for the entire thing. a lot of concern that this isn't going to fly in terms of motivating or enabling infrastructure we desperately need. >> thank you, senator merkley. >> madam secretary, thank you for being here. mr. secretary, just a couple of comments before i ask questions off of the undersecretary. for you at the department of

transportation, i want to raise the topic of hours of service, one that never seems to end at lease in the my life as a representative of a rural state, in particular. i want to raise for you that a mandate on the electronic logging device. there is a 90-day extension that expires march the 18th, a few days from now. i need your help with working with the livestock industry to delay the implementation of eld. this is an hours of service issue, how do you haul livestock, live animals and comply with the mandate, the hours of service law, from a humane and common sense point of view, what we have today doesn't work. the rubber, so to speak, is hitting the road because of the eld mandate, changing the method by which truckers record their hours of service.

there is a petition pending, request for delay. march the 18th is around the ko corner. this issue needs more attention. i thank you for your nodding yes and hope that is a suggestion that you will help us fry to find a solution here in a matter of a few days. >> i'm very concerned about this issue. i have heard a lot on this issue from various sen force and congressmen. waivers are one way but we are also tied legislatively. we hope to work with you. >> we are working in the appropriations process and the omnibus bill. they have allowed a 90-day delay. secondly, madam secretary, in your confirmation hearing, i submitted to you a question about the commercialization of rest areas.

you indicated in your response -- it was a written response, that you would adhere to the existing law. congress has voted on the issue of commercializing rest areas and overwhelmingly, the vote was 86-12, voted against this commercialization. i don't have a specific question. i would highlight for you your answer to me and the present plan in front of us from the administration does include commercialization proposals and certainly, again, as a rural legislator, interested in those local businesses and franchisee franchisees, we have a concern. >> i hear you. >> i'm sorry. >> i hear you. >> nathank you, ma'am. to the issue of water resources, in 1:58, i want to raise two topics with you. one is the way that -- lack of

resources is a common denominator, a complaint you and i would have in regard to our ability to do water resource projects. i wondered if the process by which the army corps of engineer uses, you have gone to a three-phase process in what used to be a two-phase process. so we have gone and now have the feasibility phase, the p.e.d. phase and the construction phase. my question, mr. secretary, is, has there been any consideration of reducing those three phases to two. once we get through the first two phases, which take a period of time, there is no money for the construction phase. can we shorten the first two phases into one in hopes that those projects aren't lingering as long as they do today waiting for the funding? >> those are internal negotiations going on inside the corps of engineers.

to answer your question, those are three completely different things. we are looking at streamlining. we know we want to quit wasting a penny here and add the pennies up and put a dollar in the ground. that's what we want to do. i've got the commitment from the general. we are going to do that. the three phases that you talk about, i think we'll streamline each one of them but i'm not sure we can do away with both of those -- one of those. they even have different type of engineers and planners working on them. >> thank you for your answer. if you would follow up with me, that would be fine. >> my final point to you is i've noticed a particular problem we have in kansas related to the core. i won't ask the question, because i'm out of time. i would highlight for you. we have on going dam work that the surface of the dam is a

state highway. that requires a detour over the dam for the next several years while construction is on going and there are no resources to provide the detour route around that the army corps of engineers is involved in. we need them to work more closely with state and local in advance so na a solution can be found for alternative routes. >> that's very reasonable. >> thank you. >> senator cardin. >> thank you, mr. chairman. i thank both of our witnesses. secretary james, i want to talk about our high priorities for maryland and our region in regards to environmental restoration and sites for dredge material. i start this by asking you a question specifically about popular island, which is an on going project in the president's budget. i first want to acknowledge

general semonite's letter which i received which he has completed the chief's report on mid bay, which is the next staging area to continue the program. i appreciate the general's comment, i consider this a very important project for our eco and it may have ga and navigation system. that's what popular island was for. congress specifically authorized it for that purpose and has funded it. i understand that in the president's budget submission, he reclassifies the project to compete solely on navigation, rather than the dual purpose and provides $21 million of funding, which is an inadequate amount of money. we hope to address that during the appropriation process.

i'm not sure legally what basis the president has in the budget submission to change the authorization by congress. i would ask your cooperation to check the legality of that but more important to work with us. the bottom line is, we want to be able to continue this policy, which has been extremely successful for navigation and environment where we have the local community strongly supporting the site locations and we are able to maintain our channels. would you personally take a look at this and work with the regional delegation so we can make sure that popular island can receive the needs for its last diking and be able to complete its mission and we hope to transition to mid-day. >> how much time do i have? >> if you are going to tell me, i agree with you completely, you

can take as much time as you want. >> well, i have been briefed on this area, the dredging and the poplal island situation. i couldn't answer it if you posed it as a question for sure. my staff will get back with you on the specifics and i will be happy to work with you as we go forward. >> i appreciate it. >> i have an overall theme and feeling on dredging and dredge disposal in our country. the fact of it is that a lot of our dredge material placement is turned down and not allowed because of, quote, environmental objections and it actually prevents dredging due to the

increase in cost. it actually prevents dredging were taking place. it is not just up the north coast there. it is all around. as we move forward as i can get out of the cradle, i intend to talk to the other permitting agencies about that and see if we can agree on a way forward. >> i appreciate that. >> i'll return the question, how much time do you have? if you do, i would invite you to join me, senator van hollen and others to visit poplar island. i think seeing it will be ex creamiex extremely important. a major part of chesapeake bay. i welcome working with you on that and recognize that congress

specifically did authorize that project. >> the second point i want to remain in the remaining seconds to secretary choy. i say that recognizing we have challenges in the washington region. i have a special interest. i commute back and forth from baltimore every day. it is a challenge. we need better transit. we need better commuter rail. we need better ideas on rapid rail. obviously, we have to work with the community to make sure that what we do is consistent with what the community wants. we need to have the resources in order to move those forward. these are substantial investments that under the current funding laws are going to be a challenge to get. we need additional funding in order to achieve that. the last point i want to put on the table is that we have a tremendous backlog in

maintenance. before we build a lot of new roads and bridges, are we sure our current roads won't collapse or bridges collapse. do we have a commitment to maintain our infrastructure as part of this initiative? >> the overall funding for roads and bridges in america is assumed actually 84% by the states and local areas. actually, the federal funding is only 14%. putting that aside, i think maintenance is very important. we want to work with you on that. >> thank you very much, mr. chairman. >> thank you very much, senator cardin. >> senator ernst. >> thank you very much. i want to thank you for bringing up the eld mandate issue. i want to go a little further and ask madam secretary if there is a specific date object which

the d.o.t. will be getting back to our livestock haulers on that. the time period is running out. it is just about two weeks away. we need an answer there. do you have a date we can expect the d.o.t. to respond? >> i think the larger problem is the hours of service. if we do anything, it will be another extension. >> okay. >> another waiver. >> waiver. >> but that is not a permanent solution. we need to have another fix. >> so we can expect that waiver to occur before the mandate runs out? >> i am sympathetic. a decision will have to come out before march 18th. >> thank you, secretary. i did hear from a hauler yesterday. they are very, very concerned about this. so thank you for that. i would like to also visit with you, secretary, about rural

broadband. i was really glad to see that the administration recognizes the importance of rural broadband deployment and making it eligible for funding in the framework of a rural infrastructure program. the federal broadband loan and grand programs such as the fcc's universal service fund high cost program and the usdas rural utility service is that they are already in place. what i'm wondering is why did the administration decide not to do direct funding through the existing programs. not all states are going to have the level of expertise and programs in place to efficiently build out their broadband. i do understand the significant of doing grants to the states. why are we not utilizing

existing programs? maybe some thoughts there. >> i will look into that. seeing that you brought it up, basically, 25% of the funds will go to rural america and then it is going to be up to the governor and the states as to how they want to spend that. broadband is obviously one area we would encourage for them to pay some attention to. >> absolutely. broadband is very, very important to our rural areas. i do understand that we will have a quarter of the dollars allocated for the infrastructure package going to the rural areas. we want to make sure there is expertise involved in building out some of those broadband networks. we'll encourage you is to look at that to that i can sure those dollars are used efficiently.

we'll want to work with the fcc on that. we're glad it was included in the infrastructure package. secretary james, of course, i am going to bring up one of my favorite topics, which is our cedar rapids flood mitigation project. it does apply to a number of other senators here as well that have projects that are affected by the benefit to cost ratio. i sent a letter to you and general semonite in early february looking for answers to some of the questions i have about how the corps determines which projects are funded under the significant risk to human safety exception. i posed this question numerous times with general semonite and director mulvaney. we haven't really figured out how those determinations are made for that safety exception.

do you have an update on how those determinations are made and when i'll be receiving an official response? >> no, ma'am. since your letter, i have not been updated on that. i did ask the question and the answer at that time, which was a short answer, because we were weaving through everything, was that there has not been one accepted since 2012, i think it was. that's not a very good answer. i'm not giving you that for an answer. if you will allow me a few more days to get deeper into it myself, i will give you a call, meet with you, whatever, and try to figure this out. the way the budget is written and the other factors that go into making that determination

of bc ratios, it just won't fit for the corps to legally do that work right now. i want to look forward with you and work a way forward and see what we can do on it. >> thank you, mr. secretary. if it does require a legislative fix, we need to figure that out so that rural areas, those low cost of living or low property value areas do have a fighting chance to be considered. >> yes, ma'am. i can't suggest that to you but i can give you any information you ask for. >> yes. as far as the safety issue as well, a life in iowa is just as valuable as a life in california or new york. thank you very much. >> thank you. >> senator gillibrand. >> thank you, mr. chairman. madam secretary, last month,the ntsb issued reports on two rail accidents that happened in

queens and hoboken, new jersey. they found that engineer fatigue and sleep apnea resulted in the crashes in both instances. this is not a new issue. the engineer of the train that derailed in the bronx in 2013 suffered from undiagnosed sleep apnea. this is a problem in other modes of transportation, including trucking. addressing this problem is on the ntsb's most wanted list for transportation safety improvements. this is why i was very troubled when the department of transportation announced it was withdrawing a proposed rule on screening rail engineers and truck drivers for obstructive sleep apnea. what does d.o.t. intend to do to address this very real and urgent safety concern? >> senator, since you brought it up, i will take another look. >> thank you very much. very grateful. the second issue is about the federal transit administration which is an agency of your department has issued a rating of medium to low for the gateway program's hudson tunnel project,

which is the second lowest possible rating. this means that the project is not eligible to move forward to the next phase in obtaining a federal new start grant. how did the fca take into account the funding that the states of new york and new jersey have committed to providing for the local share of the project, which is 60%, which is over $6 billion? >> first of all, this rating was done by the career folks. so it occurred in the fda multilayers before it even comes up to the political appoint tees. we are not anxious for a fight on this but for new york and new jersey to consider funds debt that we have given them as part of their equity back to us is something we disagree with. that is where in our calculation, new york and new jersey are putting in 5%, not 50%. so we will continue to talk

about this, but using riff loans as part of equity is not how we define equity. >> the administration has spoken about a desire to have more local skin in the game when it comes to funding infrastructure projects so the federal government is not bearing the full cost. do you think that federal loans count as having skin in the game for the purpose of providing local cost share? >> it is like a mortgage. if you have to put in 20% mortgage and you get another loan and you put down your down payment for the 20%, that's not really equity. that's just another second mortgage that further encumbers the house. >> if you are only putting in loans and you are not putting in any funding through grants, it means that we are paying for the whole project. >> no, because our loans are 50%. you are counting back 50% we are giving to you in loans as equity. >> we are paying for it just

same way you actually own the house. you own the house and you own this mortgage. >> there has to be some equity in there. i don't want to argue with you, because this is a huge issue. it is huge to you. it is important to me. let's continue to work on it. i think it is further definition of what equity is and what the local participation is. >> quay. okay. so how would you like to work to move this project forward? >> i am open to your suggestions as well. perhaps we should get our group and have our staff work with your staff. >> let's do that. thank you, ma'am. >> thank you. >> thank you, senator gillibrand. >> senator? >> thank you both for being here today. madam secretary, i am very excited about the administration's attention to rural development, particularly in infrastructure and i am pleased about the 25% of proposed funds that would address the unique needs of

rural america and i echo senator ernst's feelings on the broadband issue. let me ask a question in the proposal. this goes to how are we going to match this and what are states going to do and private entities going to do? >> a state like west virginia, private investment, it would be very difficult to attract. because the administration says that raising new nonfederal revenue will be given a 50% rate. i live in a state that is very challenged, cash strapped and rural. however, last year, our voters voted, via referendum to approve a sale of road bonds. we did it because there was a feeling from the ground up we needed to do something about our deteriorating infrastructure on the state level. one of our institutions in west

virginia is a radio guy named harvey kerrcheval. he came up with advertising theme, ftdr. he played it every day on the state-wide radio. it stands for fix the dam roads. it worked. what i'm getting at is, i want to make sure even though this was passed last fall that when we move forward with this infrastructure, we are going to be able to retroactively grab that as our match. i know it is in the infrastructure proposal. years zero to one, you only get x percen "x" percent. it is unclear how much we will have as a cash-strapped state. i don't know if you have a comment and where you think this

goes in terms of the states that have made this move don't want to be left out and only looking forward instead of looking retroactively to a year or two previous. >> i want to compliment west virginia for its creativity and innovation. it can be done, as has just been shown. number two, i also understand that not every rural region or state can have that kind of access or can do that. that's why the rural proponent of the infrastructure proposal is not competitively bid but it would be done somewhat on a formula basis. that is subject to the will of congress. so what you are talking about is a lookback. a lookback currently is three years. i hear you. i will go back to the white house and talk to them about it. >> a little more specificity. the rural area, i know i have been in numerous meetings with you and others and those that represent rural areas emphasize the difficulty of attracting

that private capital. thank you. >> secretary james, i wanted to talk to you about our waterways and the fy-19 budget request from the core. the lower monlocks which are important obviously to moving cargo down through the ohio river. they were built in 1907. they are very antiquated and they need repair. our barge operators have already supported a tax increase but they are not seeing the dollars coming to the areas that they utilize most frequently. i would like to ask you why does the administration not propose spending any money on the lower mond, kentucky and the other projects in fy-19? >> the reasoning, as i understand it in my short time being on the job, is that they do not meet the benefit/cost ratio that's required for those

kinds of work. >> are you saying it is down on a priority list or we are going to close them and let it them deteriorate where they can no longer be used? what's the long-term plan? >> i don't have that yet. >> maybe we can work together on it. >> i would be happy to work further with you on it. i apologize. i just don't have a grasp on that. i do know that's why no work has been done on them and they have not been budgeted, because of their ratio. necessary about it that i know right now but i'll be happy to go forward working with you. >> nang ythank you. thank you very much. >> thank you, senator capito. senator van holland. >> chairman, secretary james, first of all, let me thank you for your testimony. i want to associate myself with senator cardin's comments and

questions with respect to both the success of poplar island in the bay and the mid-bay project. it is really important to navigation for the channel for the port of baltimore. i'll look forward to working with you and your team . we have been and will look forward to. secretary chao, thank you for your testimony. when it comes to modernizing our infrastructure, this is an issue that brings people together. i remember the night that president trump won. the one issue he talked about, substantive issue he talked about, was modernizing our infrastructure. a lot of us would have liked to see us move earlier. we are glad to try to move forward now. i guess my question does go to the simple budget math. number one, i have serious questions about the leverage

ratios and what used to be essentially a federal program, our highway program, 80-20. you flip this on its head for the purposes of this new proposal, 20/80. i support many of these private/public partnerships. you and i have worked together on the purple line in maryland. we believe that will be a successful private/public partnership. if you look at the funding sources, about almost half comes from the federal government. that was really required to leverage the state and local component as well as the private component as part of that project. i think they are very serious questions about the leveraging math that's being used. i have a question about the overall budget math here following up on senator merkley's question. it really does seem like an effort to give with one hand and, of course, we can't give in terms of this transportation plan, because we don't know the funding source for the federal

share, and taking away with the other. what is your estimate of the current ten-year shortfall in the transportation trust fund? >> as i mentioned, the mandatory part of the department increases 4%. so pretty much the budget is the same. it's also the same compared to fiscal year 2017. >> it went up, ramped up for 2018. that's what people are comparing to. 2017, that was always the level. the second one is -- sorry. >> i serve on the budget committee. >> sorry. the $200 billion is put in for the infrastructure, is put in another fund. >> you are putting $200 billion. we don't know what the source of funding exactly will be but you are cutting as senator merkley

pointed out in other parts of the budget well over $200 billion in infrastructure. for example, you were just talking to senator capito about rural areas. you cut $5.1 billion out of rural water and wastewater grants. >> that's not in my budget. >> i know, but it is the case, is it not, that one of the uses of the $50 billion that can go to rural areas is for rural and water infrastructure? isn't that part of the plan? >> my infrastructure portion is only transportation. >> i am talking about this whole plan. a lot of discussions. senator capito raised the importance of the $50 billion plan. one of the eligible uses for that is water and sewer. the president's budget cuts $5.1 billion from that pot of money. the other big example is the short fall in the current transportation program that allows for 80 fed/20 state.

do you have any plan as the secretary of transportation to fill that estimated $160 billion shortfall over the next ten years? >> well, that whole issue about the highway trust fund has to be addressed. it is solvent until 2020, because of the fast act. >> ma'am, i just wanted to know if as of today you have a plan? >> i am going to want to work with congress on that. >> my last question goes to following up on senator carper's question. the president has said on a number of occasions that he does support an increase in the gas tax to fund this $200 billion plan. does the president mean what he says about that? >> you would have to ask the white house. >> have you been in meetings with the president? >> yes, i have. >> has he told you he supports increase in the gas tax? >> i think you need to ask the white house. i don't die vvulge questions ab the president and every cabinet

member will say that. >> we are talking about a $200 billion plan, which many think is too small to start with. the leverage assumptions many of us think are way off. even that $200 billion is right now a hallucination until we have a funding source? >> i agree with you, we need to find a pay source. that is very important. there is no agreement on that. so we need to work on that. >> i am just wondering if the president has found a pay for, which is what he has said in the gas tax. if he hasn't told you as the secretary of transportation -- >> i will have to ask the white house. >> thank you, senator. now, on nebraska statehood day, the senator from nebraska, senator fisher. >> nathank you, mr. chairman. it is nebraska's birthday and i am pleased to be here. secretary xhou,chao, i was pleao see that it included permission to delegate review and permit authority to the state.

this bill was on the work with safety lieu and map 21 to delegate the nepa authority to the states. my build usa infrastructure act includes several provisions. under my proposal, states would be given the purview over the design, permitting, and construction authorities that are kurndcurrently under the fe highway administration. in your view, what do you see as the benefits of delegating these authorities to the state? i see them as being able to stretch current tax dollars so we can move forward with infrastructure projects. what is your view, madam secretary? >> as you said, there is the ability but, first of all, state and local authorities know best what are the needs within the community? we want to be a partner to the states. number two, as you mentioned, they know best also how to leverage, how to work and partner with other sources of capital and revenues. >> so as we -- many of us tend

to focus on where is new rev vi knew to come from? one of my deepest concerns is how can we better spend the taxpayer money we are already charged with spending in a responsible manner. thank you. nebraska is currently in the process of assuming nepa authority for transportation projects. can you provide me with an update? >> it has been a great pleasure to work with nebraska. you need to go back to the department of transportation and let them know we have really enjoyed working with them. we hope to sign a mlu very shortly. >> we do tend to benefit from consistent formula funding for infrastructure projects in the state. it seems unlikely that nebraska will benefit from some of the president's proposals when it comes to incentive programs or

transformative projects. would it be correct to say that the president's infrastructure proposal incompete proposal intends to supplement current infrastructure funding programs instead of replacing them? >> you are absolutely right. the dollars that we are talking about are on top of what is in the budget ordinarily and on a formula basis. >> as i was looking through the proposal, 80% of the funding under the rural infrastructure program would be allocated to the governors. you mentioned that earlier to provide the states with flexibility. it is based on a rural formula. my question here is, the rural formula is based on rural lane miles, rural population. how does the administration plan to define rural for the purpose

of this funding? i know across the federal government, there are many, many definitions for rural. what are you specifically looking at? >> you are talking also about leveraging the funding. we are very concerned about rural america. on the specific question, i have to confess. someone told me and i cannot remember for the life of me. let me get you an answer back on that. the whole issue as to how we define this, i was told but i cannot remember. i will get back to you on that. >> for example, a lot of times rural gravel roads are included in a formula, paved roads, the current definition used by the federal highway administration, i would be interested to know if you are looking at the usda, some of their definitions of rural as well. so if you could get back to me, that would be great. >> i will certainly do so.

>> nathank you. >> also, on the rural infrastructure program, the proposal included language to develop rural interstate projects, an important interstate expressway project we have in the state of nebraska is in our panhandle, the heartland expressway. it is part of the larger ports to plains corridor that runs north to south across this country. when it is completed, the heartland expressway will provide greater access for our agricultural products to the country. it is going to help to have this multi-lane divided highway access. can you elaborate on how rural interstate projects would qualify for rural funding under the president's proposal? >> is there anything specific on rural interstates, specially when they connect through states from canada to mexico like the

ports to plain projects does? >> the department has sent guidelines, principles, and we did not send legislative language and that is an indication that we want to work with the congress an how to define some of these things. >> we will look forward with working with you on that. thank you so much, madam secretary. >> thank you, senator fisher. >> senator whitehouse? >> thank you, chairman. welcome to both of the witnesses. let me start by saying that we have heard a great deal in the course of this hearing about rural infrastructure. i would like to focus a little bit on coastal infrastructure. america has coasts. some of us represent states that have coasts. along those coasts, we are seeing very serious predictions of very considerable sea level rise including predictions that

continue to come from the federal government under this administration. working with noaa, rhode island is looking at as much as nine feet of sea level rise. if that were to happen, amtrak is gone through connecticut. the map of my state would have to be redrawn. a consider amount of our wastewater infrastructure tends to be low because of where it stands in the gravity flow, has to be relocated. coastal highways and evacuation zones, flood maps, there is an enormous amount of work that has to be done to prepare for what we now have been told very strongly by the federal government is coming at us. i'm a little bit concerned that words like coastal or sea-level rise or storm surge, things that we have to live with and prepare for don't appear in the

infrastructure plan. i am hoping that as we develop this plan, you will be accommodating of that fact and of our coastal state's need that fre infrastructure be designed and maybe even relocated for the foreseeable prospect of that kind of damage. >> senator, you and i have talked about this issue. i know it is highly important to you. >> i may not be the only one. >> you have brought this up many times with me. i had not thought about that. so let me take a look at the language. >> i just want to have there to be a little reflection in your mind, when you think rural, you also think rural and coastal. rural, oh, and coastal. on the corps, we are not very much better off, mr. james.

the cosor corps budget asks for billion for its flood and coastal storm damage reduction program. out of that $1.84 billion, we can identify $40 million that is marked for coastal projects. the remaining $1.44 billion is marked for inland projects. when you are looking at what's coming at our coasts and what noaa is telling us to ex tepectd what the department of defense is telling us of what to expect and the preparations the navy has to make for its navy bases, it is really hard for me to understand why there has to be a 37-1 ratio in favor of inland

projects over coastal projects. how do you defend that to coastal states. >> sir, i remember discussing this with you. zi c >> i can be like a bad penny. >> during my confirmation hearings. >> one of my colleagues would be equally if a significant feature of their state was overturned by 37-1. >> my answer is, it is not 37-1. it may be 37-1 of the entire dollars. all of the projects are processed and considered the same whether they be coastal or inland. that tells me there are a lot more inland projects that require flood damage assistance

than coastal. >> what i don't want to be in is a position in which the budget doesn't authorize funding for coastal projects. that it is $40 million out of $1.4 billion with the result that people don't apply, because they look at that budget and say, it says in huge letters to coastal communities, not welcome here. so they maybe aren't participating because they say this is for inland and upland stuff. i don't want to be in a situation where we are not getting projects in because of the budget and you say there are not enough projects in there. there is a circumstanlarity tha leaves coastal projects in real

trouble. i don't any we should be second-class situations. i know the mississippi is important. i know it floods. i know there are upland floods. when you are looking at nine coming feet of sea-level rise along our coasts, there is a lot of infrastructure work that needs to be done to prepare for that. i hope that you will find a way to send a signal to your organization and to coastal communities that coastal projects are, in fact, welcome here and are, in fact, a key, a critical part of the army corps task. >> i have no problem with that. that wasn't my personal opinion to begin with. i was fryitrying to explain to if we had 100 flood risk damage reduction projects in this country and 50 were coastal and 50 were inland, from what i j d

understand right now, it would be equal application to those two areas. >> we'll see. i just want to close by saying i appreciate very much -- i do not ascribe this to you. i do not think you personally have any distaste for coastal projects. we have talked our way through this before. i have full confidence in your personal judgment. but the army corps is a big bureaucracy. 37-1 is a very big signal in a budget. i'll just leave it at that. >> senator whitehouse, as important as it is to you, i will get with the chief and his team and i will get with my team and let me get back with you if i have said anything that is not right or if i was right. let me make sure. >> you have been great to work with. >> let me make sure. >> senator sullivan? >> thank you, mr. chairman. i appreciate madam secretary and secretary james, you being here. i think the administration's

principles on infrastructure were actually a really good start. we appreciate the opportunity to work with you. i want to reinforce what senator carper said earlier. i was a bit surprised by the leadership enter the senate on my side, on the republican side that said they didn't look like they were going to have time. we should make more time. if we don't think we have time, let's workwe week ends. i think this is a great opportunity for bipartisan support. i'm not sure what my leadership was talking about. i think this is a huge priority. let's get to work. we should ye eight time. th compre eight time. this is a good, good opportunity. i want to thank you for the alaska visit. it's summit we had on infrastructure, sterling highway is now starting to move forward. it only took 25 years of permitting delays. other than that. it is starting to look good.

your previous comments this morning on the importance of permitting, can you talk a little bit about you touched on it a bit, this whole idea of the funding actually for infrastructure in some ways can be and will be a function of how aggressively we address permitting reform. if you have a significant permitting reform, you know i have a bill, the rebuild america now act. mr. chairman, i would like to submit this for the record. it was an op ed i had with the head of the laborers international, terry o'sullivan on the importance of permitting reform. without objection? madam secretary, can you touch on that, just how permitting reform is actually in some ways a driver of how much money we are going to be able to get with regard to particularly private

sector money into a broader infrastructure in america? >> as was mentioned, with every year's delay in permitting, there is an increase of a minimum of 3%. so project costs increase every year the longer they are stretched out. number two, the permitting aspect, we're not talking about not protecting the environment. we all care about the environment. we are talking about commonsensical ways to reduce duplicative, redundant, s sequential information. we can have sister agencies share information. one office in trance pore natsp.

they don't share with another office. the other thing is that with permitting. the private sector would be deterred if the permitting were to add years of delay and increase their risk. >> on highways and the average time it takes to permit a bridge in new jersey or new york or rhode island is like six or seven years. if we could bring that down to one year or a year and a half, you are going to have less uncertainty and more private sector dollars. by the way, as you know, madam secretary, the u.k., canada, australia, they all permit infrastructure project ns a yeayea year, a year and a half, two years. the radical position is how

delayed we are. >> when you talk about sterling highway, when i went to visit alaska, it was 35 years in the making to get that to a remote alaskan village that really needed help. >> thank you. we want to continue to work with you on that. secretary james, i wanted to talk just briefly about wetlands. my state has over 60% of the nation's wetlands. 6-0 in alaska for the whole country. we have wetlands totally approximately 274,000 miles. that's plarnlglarger than the s texas. when we have 404 -- section 404 permitting requirements with the corps and the epa and the mitigation requirements that come with that, it is almost always a disproportionate cost and delay with regard to infrastructure in alaska. i just wanted to ask you very

quickly and we'll have some questions for the record. a number of us have been looking at the clean water act, relevant regulations from executive agencies from both democrat and republican administrations previously that give federal agencies sufficient flexibility and latitude to take alaska's unique circumstances into consideration of wetland permitting processes again because the vast majority of the wetlands in the country reside in my state and it just takes an inordinate amount of time to get through the 404-c permitting. can i get your commitment to work with you and your office on these, this kind of flexibility on the 404-c? >> yes, sir, i would be happy to. >> i want to thank you again,

general semonite on the work you have done with regard to the port of nome. you may have heard just recently, there was a cost share agreement between nome and the corps for the study of the port there. i think we have made good prague sgres progress on that. >> i would like to start out the vote will start in a minute. i am going to have to ask you to hold within five minutes for each of those. senator marquee is next. >> thank you, mr. chairman. we welcome you here. we want to have a huge infrastructure program that opens up in our country. we need it desperately. the way i look at the formula in the trump proposal is that it takes $200 billion and existing federal infrastructure, money, and it repackages the same money as a new program and then step

two it flips the formula from 80% coming from the federal government and 20% from local and state government to 20% coming from the federal government and 80% from the state and local government. maybe it is like the miracle of the loaves and fishes. it did work 2000 years ago. i just don't think it is going to work here where the local governments can come incompetent with 80% of the money when the reason that we need national infrastructure bills is that they need the help and they need the federal government to come in. my fear is, i'll be honest with you, i just think that wall street will say that we'll come in and help. but they are going to have to be

paid. that's going to be tolls they are going to want to impose on drivers and communities as a way of getting paid. that's how wall street operates. so it just changes the relationship as a result between the infrastructure in our country and ordinary citizens. i just think that they are going to wind up being tipped upside down and having money shaken out of their pockets ultimately to pay for infrastructure that historically under the 80 fed/20 local, was subsidized by the government in order to make sure the roads are there for everyone. i have a big problem with the math. i just don't think it is going to work. i agree that when the heritage foundation and morton agree upon something and they are agreeing with ed markey, that is new political dna out there that

requires a better explanation of how these projects will get built. now, i do know that wall street would love to have the national environmental policy act to just be gutted, to be watered down dramatically and that's what this infrastructure proposal does. it takes the constitution of the environment for the last 50 years, the national environmental policy act, and it makes some fundamental changes. number one, it would cut the amount of time that the public has to sue over bad projects from six years down to 150 days. now, that would be great if you want to be a wall street firm and get a quick return on your investment. if you are a community, and all of the sudden you hear there is a brand new road coming throug , a whole section of town and you are told you have 150 days to mount a battle against a wall

street law firm that is just going to truncate your rights, that's going to be, i think, something that is very disastrous for the local communities all across the country. secondly, the bill also expands the ability of agencies to simply decide that certain types of projects have no environmental harm at all. the agency decides it. and it's just a single agency, by the way. one agency would make the decision. secretary zinke would be able to decide that pipelines can go through parks and the other agencies wouldn't be able to get into the middle of that. and similarly, the epa would be truncated in their ability to be able to make decisions that were appealable because the secretary of transportation would make all of these decisions, and the other agencies would not be involved. i just have a problem with the formula, and i'd like to give

you a chance to respond to it because that's the core of it. the money isn't sufficient, and the environmental reviews are truncated. >> i would be more than -- i think it's important to emphasize we want to do this on a bipartisan basis. so as we go forward, these are issues that you're concerned about, let's talk about them. >> i still have 12 more seconds to say that if it's not changed, if there isn't a fundamental change that's made, then citizens are going to wind up with their environmental protections being watered down and they're going to be tipped upside down and having money shaken out of their pockets to pay for the fees. >> as i mentioned, we have no intent of diluting any environmental protections. if you look at the bureaucratic way in which permitting occurs, it doesn't make sense. they're redundant, duplicative. they discourage communications

among sister agencies. there are many, many ways in which the permitting process can be streamlined and improved without compromising on environmental protection. number two, on the roads and bridges, the 80/20 rule only applies to interstate. 84% of the roads and bridges that are in each state is funded by the state. the federal government share is only 16%. so overall infrastructure is traditionally actually funded by the states. it's only the interstate that is -- that the federal portion comes in. >> which is the essence of this -- >> no, the infrastructure is everything, actually. the infrastructure proposal is whatever local community wants. they decide and they make a targeted appeal to this competitive process. the more creative and noinnovate they can be in financing, meaning if they can get more

private sector involved and other parties, they'll be in a better position to win more federal -- the federal grants. >> thank you, senator markey. i appreciate your questions. senator. >> thank you, mr. chairman. we appreciate your hard work. we also appreciate the fact that you're honoring your commitment to make yourselves available periodically. it's very, very helpful. secretary chao, i'd like to ask you a question. it really doesn't have -- it's not under your purview in the sense this is a water question. as you being such a major player in the infrastructure package, i really think we're in a situation now where you can't think in terms of just one thing. we can put our roads and runways and railways in, but if you don't have the water infrastructure to back that up, it simply doesn't work. we're in a situation now where things are ageing, and there's a tremendous need. so i'd like to talk to you.

senator booker and i have introduced the securing required funding for water infrastructure now act. what we're trying to do there is -- and we've had tremendous success with outside organizations, multiple sponsors in congress, but what we're trying to do is make it such that we allow the state-revolving funds, the srfs, to bundle multiple drinking water and waste water projects together and submit them to the epa for approval through the water infrastructure financing and innovation act, the wifi act. because every state is aaa bond rated, and all of our projects have rate payers. president srf-win act really makes itself -- and answers some of the concerns of senator markey in the sense we have have tremendous leveraging ability. these aren't grants. these are actually getting paid back.

so as a result of that, i really would encourage you, you know, as you are putting these things together that you are looking at this. hopefully the administration can support that. hopefully you can support it in an effort like i said to take the dollars that we can and leverage as much as we can in a common sense way. >> i will bring this back to the white house and also epa administrator. >> good. thank you very much. secretary james, it's good to have you here also. arkansas is a real state that relies heavily on agriculture, as you know very, very well. in fact, we're the number one rice producing state in the country, third in the continent. the list goes on and on. ag is number one in our state, as it is in so many other states throughout the country that we forget about. $16 billion to our economy. many hard-working arkansans rely

heavily on the inland water ways and ports to ship their crops across the nation and export them all over the world. tell us the consequences for rural and agricultural dependent states if we do not invest in our nation's inland waterways and ports, and do you feel the administration's principles for infrastructure properly address america's inland waterways? >> i do feel that in the infrastructure bill, it does address the waterway system. it allows us to develop that bill as we move forward with his submission of that bill to us to be able to move forward with it, that it does cover our inland waterways' infrastructure. you and i know this. for the other members and for the record, if the inland

waterway of, say, the arkansas river shuts down, everything from mid-oklahoma down to the mississippi river would be shut off. it's a huge amount of prosperity, huge amount of interstate commerce that comes from that, and then the same goes for every other navigable running stream in our country. they're provided by locks and dams. most of our waterway infrastructure is in locks and dams. the mississippi below carrow, illinois, is not. it's a free-flowing stream, requires a lot of maintenance through the major flooding that the lower mississippi valley receives. but without the navigation, i

mean, there's no way grain would be spoiled on the ground and our balance of trade would go out the back door quickly because as i understand it for years and years and years now, the balance of trade has been supported by the agriculture community. >> thank you very much. and thank both of you again for your hard work. appreciate it. >> thank you, senator. senator booker. >> thank you very much. i want to try to go really quick. the first is a hearty thank you to both of you for your testimony and your commitment to your jobs and the mission of our country. secretary chao, i'm grateful to have you here again. thank you for your willingness to engage with my team, and the other four senators dealing with this gateway project. you came to senator schumer's office in what was i thought a very constructive dialogue. you indicated to senator jill he bra -- gillebrand --

>> of course. also, gateway is not just one project. there are nine projects. >> you and i are both familiar with it. time is running. the second thing is, you committed also that you'll come up and visit us, see the project. we've had republicans, democrats do it. it's stunning to go through the tunnels and see the crisis. that commitment stands, right? >> i've been trying to do that. >> i know. you and i have been trying to work out our schedules. thirdly, the multiple projects involved, i heard the back and forth with you and the senator on loans and how they're counted and the like. so is that the standard now for all projects in america? that the federal commitment doesn't count as a state commitment loans. >> i'm not so sure this is new. it's always been that way, number one. number two, there was never any federal commitment. it was a verbal commitment, verbal sentence given at a

political rally. there was no commitment from the federal government. >> no, no, i understand. but the downgrading is because of -- >> it's always been this way. >> okay. that contradicts your website. can i read you what your website says? >> okay. >> it says the proceeds of a secure loan will be used for any nonfederal share of project costs required under title 23, chapter 53, title 49. that's what your website says. it contradict what is you're saying here. >> then i need to look at it. so thank you for bringing it to i many eny attention. i'll take a look at it. >> we should have a fair standard. i know these programs. this would crush every area of our country if you shifted that to what you represented to the senator here. your website says this. my familiarity with decades -- >> yes, well, thank you for bringing it up. it's not my understanding, but let me take a look at it. >> i really appreciate it. just to champion the great work

you guys are doing, the department of transportation's efforts on the gateway tunnels environmental impact statement has been amazing and consistent with what everybody's been saying. let's cut the regulatory time. my understanding is the gateway project development corporation has finalized their environmental impact statement and is on track for a final eis pending d.o.t. approval at end of march. this is an incredible achievement. they're literally cutting in half the typical amount. this is us, actually you all, cutting bureaucracy. i want to make sure everything is on schedule to achieve something we can all brag about, a testimony to the trump administration's cutting red tape. can we get that done by march 31st? >> i would love to promise you that. i don't know whether i can. i will take a look at that. >> okay. we've made incredible time. out of respect to my colleague, i will end early. >> thank you. >> senator duckworth.

>> i thank senator booker for being generous with his time. thank you, mr. chairman, and ranking member. secretary chao, secretary james, so nice to see both of you again. secretary chao, i see a lot of philosophical similarities between the president's infrastructure proposal and the goals of d.o.t.'s infrastructure to rebuild america grant program that was established last year. i understand that both seek to align federal investments with national and regional economic goals. there's an emphasis on leveraging federal funds with nonfederal funding, including public and private partnerships. also to promote innovative solutions. is that a fair thing for me to say? >> yes. >> thank you. as you know, the 75th street corridor improvement in chicago is just part of the create project, meets all of the program goals. the project provides robust

national and regional benefits. it will increase national freight and passenger rail activity, and is reflected by the support of nine different midwestern states. each of the class one railroads and numerous corporate interests. in fact, a study by the university of illinois highlights that three corridors of the program's impacts would occur outside of the midwest. more than 65% of the project costs are already committed through a public-private partnership even. so given the robust support and alignment of all levels of government, the environmental review and record of decisions are also complete. so the project can move forward as soon as you give it the green light. i'm asking that you give this critical project your full consideration as you finalize the grant awards moving forward. >> i will certainly do so. >> thank you. do you have a sense of when the awards might be announced? >> we have to get the other grants out, which will be hopefully in the next two, three

weeks. after that, then we'll turn to the infra. hopefully by the summertime, if not sooner. >> okay. back to the infrastructure proposal. the administration is calling the plan a major investment in our nation's infrastructure. yet, as my colleagues have noted, the president's budget cuts more infrastructure than would be invested. how is this a major infrastructure investment when you propose spending less than we already do? >> well, i think this is a policy difference. we can talk more about that. what's important is that this infrastructure proposal needs to be done in a bipartisan basis. so if we can separate out from the budget and go forward and take a look at the infrastructure, we look very much forward to working with both the majority and the minority in the senate and the house. >> we're going to need more than 200 billion to be able to move forward. >> absolutely, we are. that's why we need to have the private sector involved and leverage the funds. >> i'd like to also just state

that i join my colleagues who mention the concerns for our livestock haulers with the eod deadline coming up. i've heard from people who haul in illinois from cattle to hogs to equine even. this is a real issue in our ag states. so i appreciate your attention to that. mr. james, as i know you're aware, our inland waterways have long enjoyed a federal-private partnership through a diesel fuel tax paid by barge operators. that covers 50% of the costs associated with maintaining and modern ietzing our locks and dams. i was troubled to hear the administration's budget alters that by promoting a per vessel fee to fund our ageing locks and dams. that's a nonstarter for commercial operators who would bear the cost. would it be easier and more practical to consider alternatives that allows the core to keep the revenues you already generate but are

required to deposit into the u.s. treasury, like recreational fees and hydropower revenue? the hydropower revenue is somewhere around $1.5 billion. it goes into the treasury. we could just keep a small percentage of that within the corps of engineers. you could actually apply some of that to some of the costs associated with the maintenance. >> senator, that's an interesting proposal that i've heard many times throughout my career, even before i became the asa. it's a very interesting proposal, and i'd be willing to look at some numbers with you or the committee at any time that'd be of interest to you. it's very interesting to me, so thank you for that question. >> thank you very much. thank you for your interest. that's all. >> thank you very much. i appreciate the members being here. i think i have a request for

submission for the record. we received numerous requests for submissions for the record from different organizations that have impacted by the infrastructure policy in order to ensure that the full breadth of the policy options are included in the record. i ask unanimous consent that they be added to the record. without objection. >> no objection. i'm going to make two unanimous consent requests. i want to say to both of you, thanks for being here. thanks for your willingness to take on tough jobs. albert einstein used to say in adversity lies opportunity. a lot of adversity, but a lot of opportunity. i think with your leadership and i think the leadership of our chairman and others, democrat and republican, we can make progress. we really need to on these fronts and look forward to doing that. with that, in the spirit of that thought, mr. chairman, two unanimous consent requests to submit for the record. i ask unanimous consent to submit for the record the white house infrastructure proposal summary document that states that overall for highways, 28% of funding is federal. i'd also note that the same document indicates if we look at

just capital, just capital expenditures, federal funds currently support more than half of all spending on highways, not just in delaware but in the states across the country. i'd ask that's one. i want a second unanimous consent request, if i could, mr. chairman, to submit for the record the january 2018 jr report. it's entitled highways and transit products. 99% of highway projects are -- but in federal highway -- let me say this. gao notes that it had previously reported that 99% of highway projects are not being held up by complex reviews. meanwhile, federal highway administration officials expressed that, quote, categorical exsclu categorical exclusions still

constitute the vast majority. >> without objection, so ordered. the time is now expired on the vote. we need to get over there to the floor. i do want to thank the members who have attended. i especially want to thank our esteemed guests. madam secretary, as well as assistant secretary james, i want to thank you for your time. i want to thank you for this crucial discussion regarding the administration's infrastructure plans. people may submit additional questions for the record. the record will be open for two weeks. thank you again for being here and joining us. with that, this hearing is adjourned.

you can see this hearing with transportation secretary elaine chao again tonight on c-span2. she testified before the senate environment and public works committee today on the administration's infrastructure plan. fwe again, watch it tonight at 8:00 eastern on our companion network c-span2. live coverage will continue this afternoon as white house officials hold a summit on opioid addiction to combat the opioid epidemic. joining the conversation, first lady melania trump, attorney general jeff sessions, and other officials from the trump administration. live coverage begins at 1:00 p.m. eastern on c-span.

and the nation's highest court heard arguments this week over whether unionized government workers can be required to pay union fees. listen to the supreme court oral argument for janus v.afscme. this case deals with the issue of public sector employees and union fees. that's friday night at 8:00 eastern on c-span. monday on c-span's "landmark cases," we'll explore the civil rights cases of 1883. the supreme court decision that struck down the civil rights act of 1875, a federal law that granted all people access to public accommodations like trains and theaters, regardless of race. justice john marshall harlan, cast the lone vote in opposition, and his dissent eventually eclipsed the legacy of the majority opinion. explore this case with danielle holley-walker, dean of howard

university's law school. and peter kirsanow. watch "landmark cases" live monday at 9:00 eastern on c-span, c-span.org, or listen with the free c-span radio app. for background on each case while you watch, order your copy of the landmark cases companion book. it's available for 8.95 plus shipping and handling at c-span.org/landmarkcases. and for an additional resource, there's a link on our website to the national constitution center's interactive constitution. u.s. cyber command commander admiral michael rogers testified earlier this week to discuss the military's cybersecurity readiness. he told lawmakers he's not been directed by the white house to take additional steps to respond to russian interference in u.s. elections. admiral rogers is also head of the nsa. this hearing is about an hour, 45 minutes.