and with that, mr. speaker, i yield back. the speaker pro tempore: the gentleman yields back the balance of his time. the gentleman from washington. mr. mcdermott: mr. speaker, as we close this debate and finally put this on the backburner until november when we have to come back and look at it again, perhaps, we'll see, i sense one of the speakers on the other side talked about confusion. my view is that the confusion here is between whether we're going to send unemployment checks or we're going to tell people, go hungry. that's the confusion. people say, well, it's about paying for it. i will remind my colleagues on the other side, mr. bush was president for eight years and when we zun employment we did i on an emergency basis, we never paid for it one time and you guys had -- the republicans -- i'm not supposed to address them

directly, they didn't pay for it, mr. speaker. they were in charge and their president was in charge but they called it an emergency. now under mr. obama it's not an emergency. suddenly we're going to -- we're going to tie up people's minds and try and confuse them but the fact is that for six weeks we have said to workers in this country, we are not going to extend benefits. now, we have never in the history of this country, when unemployment was at 7.2% or above, failed to extend benefits. until the republicans got a serious case of fiscal -- well, i'm not going to say exactly what i think. but fiscal disease has overtaken their mind. and they suddenly caught this

thing, i don't know, it must be in the air around here, or somewhere down around the ohio river, between cincinnati and kentucky, they got leadership who said, you know, if we kin effect everybody with this fiscal fear -- if we can infect everybody with this fiscal year, we'll just sacrifice a few million, it's only 2 1/2 million people who are going to lose their benefits, it's not very many, there's 300 million in america and we can throw away 2 1/2 million. that's easy. they won't vote. they're too stupid to know who's doing it to them. that's the kind of message you're sending when you are saying you won't give unemployment benefits. this is so easily understood by the american people. this is not climate change, this is not all the complicated stuff. some people around here think the american people have a very short memory span. but they don't. on stuff wrts right down to the bone -- where it's right down to

the bone. and you will remember this day as the day when finally the republicans came to their senses. they finally said, you know this ain't going to work, it really ain't going to work. we're not going to admit it, we're going to say we were doing it on principle but there's no principle at the table when the mother opens the cup board and there's nothing in it. or when the lights aren't turned on because you haven't paid the utility bills. or when the water's turned off because you haven't paid your water bill. what does a mother say the principle is? now, kids, get in the bath tub, but thers no water. clean yourself up, right? what kind of nonsense is this? you think this money is going for people to buy i pads or -- ipads or iphones or what? -- whatever? this is going for the necessities of life. and you're saying to ordinary

people in this country, well, we have a principle that we, under the democrats we have to pay for it. now, not under the democrats. and i can hardly wait until we get the proposals over from the senate to extend the tax breaks. and watch you guys do a double flip. you won't get -- you will get a 10 in olympic terms for your ability to do a double flip and say, well, now we don't have to pay for it. and watch, they're going to send over the estate tax. they are going to send over a bailout for the people at the very top and you're going to say, oh, well we don't have to pay for them, no. they're very rich and we can't, no, no, no, we can't pay for that. no, no. but we're going to make us pay for the people who are in the most dire distress in this society. it's really shameful and i enjoy -- i'm going to watch with pleasure as you vote no, as you vote yourself out of here.

i yield back the balance of my time and urge my colleagues to vote for this bill. ? >> the forum by congressmen, senators, and activists. the white -- the roosevelt reading festival. others talk about their books. and we can filled with

books. >> c-span, our public affairs content is available online and on radio. you can also connect with this on twitter, facbeook, and youtube. >> kerry reed outlined an energy bill that he says will receive bipartisan support they are joined by its sponsors. this is 15 minutes and th. >> not once, but twice and very often. many of us want to do a

comprehensive bill that creates jobs, breaks our addition to foreign oil, and curves pollution. unfortunately, we do not have a single republican to work with at this time in achieving this goal. for me, it is terribly disappointing. it is also very dangerous. senator kerry, the press, i, and others, will continue to reach out to republicans and work with the committee's and communities to garner the support needed to afford on a larger comprehensive bill. in the next few days, i'm going

to enter a bill. we are going to holds bp account of will to ensure that they clean up their mess and things like this that happen in the feature hopefully can stop them from ever happening. it to be a process move forward. number two, we need to lessen our dependence on foreign oil. that is very important. our country is blessed with a bunch of resources and we must happen to the one that we have more resources of any country in the world. that is that of gas. that is why we will invest in the manufacturing and natural- gas. number three, we need to do something that creates jobs. we are going to do that. subject have been talked about and talked about. now we are but to legislate home star, a key to the future of

what we do with energy in this country. it created jobs, lower energy costs, and this like the hatch provision is bipartisan. finally, a fourth provision will be something many have worked on in congress for a long, long time. that is to put money back in the land and water conservation fund which is essential to the future environment of this country. senator kerry? >> there is a growing coalition with legislation. over the past year and a half, working with harry reid, we a

500 and meetings and negotiations. we have built an unprecedented coalition of support that has moved is further along in this process than any of their time in this effort. today we have support from industries and stakeholders that have opposed previous bills. that is a very important achievement. have always known from day one that in order to pass comprehensive energy crime legislation, you have to reach 60 votes. to reach the 60 votes, you have to have some republicans. as the stand here today, we do not have one republican. i think that if possible -- it is possible to get there. senator lieber and died this morning had a meeting with one republican -- senator lieberman

and i this morning had a meeting with the one republican that is willing to give it a try. he is committed to giving is that opportunity that open door , what ever it takes, to find this 60 votes. the work will continue every single day. in the meantime, as senator reid has just said, we have an obligation to the american people and to our country. that is to respond to the oil spill in the gulf. that is why a senator read is going to bring this adamantly -- senator a of reid going to bring this emily narrow bill to the floor. he is determined to do what we can in the timeframe we have. that will address some of our energy dependence and some of the oil spill issues. let me be crystal clear.

senator reid said this legislation he has proposed does not replace climate legislation. it does not replace a comprehensive energy legislation. president obama called me and said point-blank that he is committed to working in these next days at a more intensive payce to help bring together the ability to find 60 votes for that comprehensive legislation. the leader is committed to get that a comprehensive legislation to the floor. senator lieberman and i will continue to work with our colleagues and stakeholders to carve a path toward 60 votes for comprehensive legislation that appropriately targets in

inappropriate way carvin so we can send signals to the marketplace and change state direction of jobs fo. i just want to say to all of you on a personal letter that i have watched the tape can be over 26 years fight to get tough things pass. in 1970, they began that effort to pass health care reform. this is not one to take that long. this is not going to take close to that long. i am cassoulet confident that as the american people make their voices heard for, we are going to grow in our ability to pass this. i just want to thank those who have brought this issue a long way. we have had a remarkable caucus of 20 senators plus you have met

a week after week. in the 26 years i have been here, i have never seen as many signatures from as many places come together consistently to move legislation forward. that effort will continue. i am grateful to senator reid and the president to put the country on the right path. >> we appreciate your commitment and your leadership. the president has made clear and has continued to make clear that we need to have a comprehensive energy policy for this country, a felony a policy that will break the dependence on foreign oil and create a new generation of energy jobs and put a cap on dangerous pollutants. the administration has taken

unprecedented steps to address this problem. we are investing $80 billion to create jobs and take major strides toward creating a new, clean energy jobs and technology. we said tough new fuel efficiency standards for cars in the first ever greenhouse emissions for cars. we will continue to use our existing tool to address these problems. everyone is disappointed that we do not yet have agreement on comprehensive legislation. we will continue to work with the senators to craft important comprehensive legislation. in the meantime, the leader has to know that there is debts of the -- there are steps the we need to do today to take the steps to begin this process. we will work with him in the coming weeks to see if we cannot achieve passage of this legislation while we continue to work to secure comprehensive and

energy legislation. >> thank you. >> do you have republicans on the narrow list? >> each we have is bipartisan. the second provision i talked about is they hatch. our number of a statement saying republicans like the program. the answer is yes. >> they have opposed the liability language. >> i would not be moving on this if i did not think it. >> are you committed to taking this to said timber? -- to september? >> i am committed to doing this september.

>> this is not the only energy legislation we will do. we are running out of time ahead. will continue to work on energy legislation the. president did a great job and what to do with the stimulus bill in reactivating back to technology in our country. there are 6 million 18 whalers driving around today in america. the life span of a truck is not very long.

one major target company was fined one did signified new 18 wheel trucks every week. this allows the conversion of the trucks from diesel fuel to natural-gas this will lessen our dependence on foreign oil. >> we are doing everything we can to increase employment. this home star bill will increase employment in every state in the union by a sixth dividend amount. -- by an estimated amount. with the money we have with homestar, we are talking about -- we could be having as many as -- what would that be? 350,000 jobs. big time with that. i am very satisfied with what we have here.

this is something we need to do. it is a number of steps. every senator could do is inadequate. i had to make a decision. i appreciate very much the president. all my chairmen have worked hard on this. we had to meet in the middle. we have had many meetings of th. they have all been understanding of where we are today. it is easy to count to 60. we learn to do that. i did in eighth grade. my point is this. we know where we are. we know where we are. we do not have the votes. this is a step forward for the

nation. >> [unintelligible] >> pardon me? >> republicans say the reason was that they do not like -- is a anyone [inaudible] >> personnelfirst of all, they t everything paid for. how do pay for it? this is an effort for them to stop. they are the judgment against our country on the matter.

they do not like to pay for it. this is the stall. this is the proverbial stall i've had for 18 months. [inaudible] >> that is the big one. >> we will see what is in it ot. >> [inaudible] >> what do you mean legislative?

i am happy to answer questions. president obama personally has talked to me many times about energy legislation in the need for it. he did this starting back in the campaign. he did not stop after he is elected president. his people rahm, carol browner and others are talking to me all the time about energy. for those who think his been involved in is simply, he has been mistaken. >> can you talk about not having any republicans working with you? what about the democrats tha?

>> the cannot make that statement. it is not a black and white issue. with some of the work that john has done, most of the senators are agreeing with what we are doing, the direction we are taking. we have come a long way. what was your account? >> one quick question. do you expect the senate to passenger rockefeller's -- senator rockefeller's bill? >> i do not know. we will take a look at that.

>> up next, the house oversight committee listens to the federal regulation offshore drilling. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] it talk about the company's coal mining operations in west virginia. the credit for their proposal for an energy bill. later, it is "washington journal." on tomorrows "washington journal" the president of the petrochemical association, a charles drevna. they discuss surely -- s hirley sherrod. "washington journal begins live at 7:00 a.m. eastern. >> this weekend on booktv, the

eagle forum discussion summons. on afterward, infidel, on coming to the united states. on sunday, the roosevelt reading festival. but there is talk about their books -- offers talk about their books. for the complete schedule go to booktv.org. c-span is now available in a for 100 million homes, bringing you a direct link to public affairs, politics, and history all as a public service, created by america's cable companies and . >> the house oversight committee vote of the reorganizations of the mineral management service.

the federal agency formally responsible for regulating offshore drilling. in this first panel, we will hear testimony from ken salazar. this is three hours. . >> good morning. the bp as bill follows a long history of ethical failures at the interior department and the management service, better known as mms. the deepwater horizon disaster has now expose what appears to be continuing major problems.

over the last decade, it has permitted the oil industry's to police itself. for example, in 2000 s to the snake, but mms issued an alert allowing them to have an active system allow no clue activate blog printers. >> they decided how they won it to comply with this requirement. bp and the other oil companies were essentially on the honest system. the deepwater horizon disaster suggests this is not an effective approach to ensuring safe, offshore drilling.

regulatory failures were made worse by the rapid growth of offshore oil-drilling in the gulf. over the last two decades, the number of offshore oil rigs in the gulf of mexico has expanded dramatically and extended further offshore into much deeper waters. at the same times, mms remains relatively small, with trouble -- and cannot keep up. though drilling has expanded by tenfold, the number of inspectors has only grown by 13%. the results, fewer than 60 inspectors are currently responsible for conducting over 18,000 inspections annually.

the agency was built in with conflict. it was given the doling responsibilities of promoting drilling and connecting royalty payments on this one hand. it also issued in enforcing safety regulations on the other hand. it seems as though it is only a matter of time before these conflicts and responsibilities would lead to the disaster we are seeing today. it was a tug-of-war between drilling in save do. safety found itself on the losing side of the struggle. even worse, regulatory failures have been accompanied by ethical failures. in 2008, the interior department found a culture of ethical failures within mms.

the investigation revealed that over a four year timeframe, a senior employees within mms improperly accepted gifts and encased in sex and drug abuse with all company employees. this is not an isolated incident. there really is another report that found that inspectors improperly accepted gifts from all companies. additionally, at least one employee conducted inspections of an oil company's operations while negotiating informant -- employment for the same company. they found the flaws and royalty collectors have resulted in millions of dollars in lost revenue.

today we will hear directly from the secretary. -- about how exactly they plan to implement the reorganization and increased oversight and accountability. i want to make one final operation. what they are responsible for regulating the oil industry and they have been taking a lot of heat for that, it does not change the fact that bp was responsible for the safety of its oil wells and bp was responsible in terms of responding to the oil spill. it is bp that is also an

irresponsible for the entire cleanup and the costs as well as the job losses and loss of income resulting from the spill. i am committed to insuring that the government has the authority and ability to effectively regulate the safety of offshore oil drilling. on that note, i now yield five minutes to the ranking member of the full committee, the gentleman from california. issa. >> thank you, mr. chairman. thank you for holding this important hearing. five years ago we began looking at failures in the gulf and more. in light of hurricane katrina, we knew that this was a sensitive area and one that would struggle for years to come and one that was vulnerable to failures by the federal government in just an area or two and whether it's the levees

that failed to protect the people of new orleans or the plan approved by minerals management service that failed to even consider the possibility that oil could come ashore in a disaster of this size, we, the federal government, have failed. every day, every american here somewhere, it seems, that a chain is only as strong as its weakest link. there were two weak links that led to this disaster, british petroleum acting irresponsibly failing to maintain safety standards well established in the industry failing to maintain their own safety standards and being in too big a hurry to cut corners,ut costs, ultimately leading to the loss of life and the loss of billions of dollars to the american people around the gulf and beyond. but there is another weak link, a well noted weak link, one that this committee has been pursuing

change for almost six years now from. minerals management service, an organization that has checks and balances that mean nothing. year ago we discovered that when a contract was signed, person after person after person was reqred to initial it. they initialed it and nothing else. they did not read it. they did not verify. they did not ask any questions. that kind of absence does not justo to the engineers that are hard to recruit, it goes to the very top of the organization and has under multiple administrations. in fact, problems in our first set of hearings go all the way back to the clinton administration. but let us make it very clear those problems were well known during the entire bush administration and for those eight years, change did not occur. sadly, mr. secretary, during the year and a half of yur administration, change did not occur. i know that it seems like a very little bit of time, but if, in

fact, the 20 or so findings that have occurred by your own igs and gao had been put together with the work of this committee sooner and the urgency put onto it, i believe this could have been prevented. having said that, we need to look to the future. we need to look to real change in the minerals management service. i personally would not like to see it broken into three even smaller parts, but rather have the real focus either as an independent agency or as one that has a level of clarity to the american people much more similar to the epa. we need to have that. we need to have the american people understand that the proper revenue that has not come to the american people is a factor. the proper controls and safeguards are a factor. chairman waxman, mr. kucinich, mr. towns and the rest of us have all seen hearings, but we haven't seen the amount of

hearings that we should have had and we haven't had the follow-up by previous administrations or to date by your administration. i believe that there are a number of factors that we can de with todathat have to do with the current disaster with a number of factors including a -- if you will, an overstatement of available resources, an overreporting of available resources and when they were there and a number of other areas. those occurred under your watch. but ultimately this is the committee of oversight and reform. and it's those published 20 reports that we want to deal with primarily, it's the discovery of documents that would allow us to take a firsthand in the reorganization to ensure that when this is over with, we can count on an agency that recruits and trains the kind of second guessers to an oil industry. i think it's important toote that there are many, many, many rigs that have been operated

safely and responsibly. it only takes one operating irresponsibly and then a lackf oversight. in fact, to my amazement, the last inspection by minerals management service of this rig before the disaster occurred as required with two individuals, two being part of the inspection team. that was because there was a requirement to have two separate people independently second-guessing each other. to my amazement, of course, it was a father/son team and, in fact, less likely to be independent. this is one of many too cozy relationships at mms that have to change. this has to be an organization of professional, not a family practice. the american people want us to take care of a number of items, but they want us to go further. i will note today that four other major oil companies have announced an investment in the construction of a very large dome designed to work in the

gulf certainly on our part of the gulf or perhaps in brazil and other areas if a similar event happens. this kind of proactiv thinking is important. in fact, mr. secretary, to the extent you've been involved in it either by urging or demanding, i'd like to personally applaud you. i believe that when we look at the blowoff preventer's next generation needed since 2003 and look at the recovery and response assets not just for this event but for any event, a major shipwreck or hurricane that destroys a refinery or even chemical failures, we all have a responsibility to see that we go with a program much more similar to putting a man on the moon than simply business as usual in the gulf. so, mr. chairman, i look forward to an extensive hearing today. i look forward to the balance of our discovery and i look forward to working with you on trying to oversee over the next couple of

years a real birth of an organization unlike the old mms and much more like an organization that we can all be assured will keep the good actors doing what they're supposed to and the bad actors altogether out of the business. with that i yield back the balance of my time. >> i'll recognize for three minutes the gentleman who is the chair of the subcommittee from ohio, congressman kucinich. >> thank you for calling this hearing. will reforms change? its history of failed oversight, it's important that we do our work of oversight. but i also have to tell you that while i'm sitting here looking at the preparation for the hearing and thinking about how we're going to focus on things, for example, i'm going to have some questions so you think about it now about the atlantis platform.

how 19 members of congress wrote to the minerals management service back in february raising questions about engineering documents,bout question -- and didn't get the answers that we were entitled to. the breach and the catastrophe occurred with deepwater horizon but the questions we raised with respect to the atlantis platform were relevant to not only atlantis but deepwater horizon and other platforms out there in the gulf but as -- soe'll get into that in the q&a, but i have to say something about this moment. there seems to be some feeling in this country that we can endle endlessly invade the natural world without any consequences. well, the catastrophe in the

gulf put light to that. we still believe we can do it but we're still moving forward with people, you know, talking about doing more drilling and we built r whole economy around this. and so, mr. secretary, you're being asked to defend a system which truly is basically collapsing. it rlly is. and i tha you for your service, but the fact the matter is, the system itself is collapsing. we think we can keep interfering in the natural world without any consequences. we think we can postpone the delivery or the development of alternative energies. we think we can keep on living in this country the way we've been living without any correction in our course even in the face of a tremendous catastrophe in the gulf. well, we're going to have to start thinking about. yield back. >> thank the gentleman from

ohio. i now recognize the gentleman from florida, congressman michael for three minute. >> first of all, i want to thank chairman towns for -- and mr. issa for convening this hearing. i'm please to see the secretary here. there are some very serious questions that need to be answered about what took place and also what measures we in place to deal with the current spills that i see from florida around the gulf coast affeing people's life, the moratorium. we have so many questions but i'm pleased that you're here. to hopefullyshed some light on your colleague. mr. issa stated tha we knew something was rotten in the minerals management service even under the bush administration and i'll put in the record a copy of a letter that cites

three criminal investigations were launched during the bush administration on that agency, things that we knew there were problems with. i'd like to know from you when you inherited that position if that was one of your focuses. there are other questions that have been raised about the development of policy with a new administration. you know, i think a lot of people voted for president obama and the other side, they thought they were the protectors of the environment and all this, and it turns out that they were asleep at the switch. and what baffles me is how you could come up with proposals to -- and i want to know if you were consulted on this budget proposal in 2011 to cut the coast guard budget, which is one of the first responders whenever

you have an oil incident or a disaster in this country. in addition, $2 million cut from mms, minerals management service's budget for environmental reviews. it's in here these were proposals. i don't know if you had anything to do with th in february of this year and then this is february, and then in march the administration develops a policy here, the headline from "the new york times," obama to open oil drilling and cites the gulf of mexico, so here we're cutting the assets of those responsible for oversight and permitting and there are questions about the rubber stamping carte blanche of the approval. this is the approval signed by your administration to drill in

deep water and then the rush to go -- do more deep water drilling. this is the list of 33 approvals by the obama administration. there's only a total of 27 deep water operations in the gulf. half of those are exploratory half approximately production buyour rush to more drilling and cutting the assets. i think -- i'd like to kw how this policy was developed and if you had any part in it or what the thinking s when they- >> the gentleman's time is expired. >> i yield back the balance of my time. >> thank you very much. let me indicate that the long-standing of this committee to swear all the witnesses in. if you would stand and raise your right hand. do you solemnly swear to tell the truth, the whole truth and nothing but the truth. if so, answer, i do. you may be seated. let the record reflect that the witnesses answered in the

affirmati affirmative. we're delighted to have secretary salazar with us. he's serving as the 50th secretary of the uned states department of interior. prior to his confirmation, secretary salazar served as a senator from the great state of colorado before becoming senator, secretary salazar spent two terms as colorado's attorney general and served as chief legal counsel and executive director of the colorado department of natural resources in the cabinet of governor roy romer. welcome, and we are aware of your time constraints and we will respe them. no question about it. and then mr. michael bromwich was sworn in as -- to lead the bureau of ocean energy management regulations and enforcements formerly known as

mms. on june the 21st, 2010, director bromwich previously served as inspector general for the department of justice and as an assistant u.s. attorney in the southern dtrict of new york, most recently director bromwich was a partner at the law firm of fried and frank where he ecialized in conducting internal investigations. we welcome both of you. at this time i ask that each witness dever their testimony within five minutes, which will allow the committee ample time to raise questions and also considering your time constraints, secretary, of course, you know the rules that they start out, the light is on green and then, of course, you know because you know all about these lights and all of a sudden they caution -- >> i'm not sure i know about these lights. >> that's another issue but also

at the end it becomes red so, mr. secretary, you may begin. >> thank you very much chairman towns and thank you, congressman issa and all the distinguished members of the committee here and at the outset let me just say thank you to the committee for the work that it has done in the prior years relative to putting into the spotlight some of the necessary reform efforts that are required of the minerals management service, many of those which we have been working on since day one when i became secretary of the interior. let me sooutset just say to the members of the committee, i know you are all wondering about the status of where we are with respect to the containment of the oil leak out in the gulf of mexico. since day one and today is day plus 93, we have been working from early morning till late at night making sure that the

entire arsenal of the united states of america is focused on the problem and i'm getting it resolved. myself and secretary -- two other members of the cabinet have been working on this from day one and as of today, we see the light at the end of the tunnel. there is a shut-in that has occurred of the well, and the monitoring that we have required of bp is showing that it is holding, but the weather patterns that we are seeing may have some interruption in terms of getting to the ultimate sluice here, which is the ultimate kills that have to occur of this well. but we are seeing the light at the end of the tunl. let me move to the subject area that i think thisommittee wants to explore, and that's the issue of responsibility and what is it that has happened here. let me frame it for this committee e way that i see it. this is a collective responsibility, and i do not

believe that at the end of the day that the blame game is going to help us relative to how we move forward and develop the broad energy portfolio and the comprehensive energy plan that is required of america, that we need to work together to fix the problem, make sure we learn the lessons from the incident and that we move forward with an energy portfolio that i think at the end of the day will include oil and gas. that has been the position of the president and my position as secretary of interior. in terms of the responsibility for this incident that brings us here today certainly bp and other companies that were involved have broken the rules and have strayed from the best practices of the industry. many invtigations are going on, much of that has already been reported in the press. secondly, industry has made the long representations of both to the congress, as well as to the partment of interior and

others with respect to drilling safety, with respect to the ability to contain blow-outs and with respect to oil spill response, the efforts announced yesterday from the four major companies moving forward with a billion dollar effort on which i was briefed will need significant additional work before we can be satisfied with at least one of those particular prongs that i think are essential to be righted. thirdly, the congress shares the responsibility. this committee has been at the forefront at least of exposing some ethical lapses but at the end of the day, the drilling that has occurred in the deep water drilling has been something this congress has also embraced and i recognize i tao was a member of the u.s. senate, the passage of the 2005 energy position act which you, congressman issa and other members of this committee voted on essentially was part of a national framework. fourth, there is a reality that this is an issue which requires looking back not just at one administration but it's multiple

administrations. the mms was formed in 1981 and you think about the fact there have been republican and democratic administrations that essentially have allowed this organization to continue by fear of secretary loiter. it was as early as last year i proposed to the natural resources committee, sent congressman real's committee that we move forward with organic -- because admissions to this agency are so important. let me -- so let me just say it's a shared responsibility and we need to move forward and fix the problems. i believe that we started in my tenure as secretary of interior moving forward implementing the reform agenda uncovered through much of the rk of this committee on ethics from day one we put together a strong and robust ethics program working with the findings of the inspector general and moving forward to clean u the corruption that occurred in lakewood and other places. people have been fired.

people have been been brought up on criminal prosecution and suspended and did everything we can to clean house. we eliminated the royalty in kind program which existed for a long time and moved forward with a comprehensive review and change with respect to the outer continental shelf plan that had been proposed by the prior administration and finally we have worked very hard to stand up the renewable energy resources out in the oceans of america. with respect to what has happened since april 20th and how we moved forward with that reform agenda it's a continuing effort. we've proposed and developed a report on safety to the president of the united states with a 30-day report that laid out a number of different majors from blow-out prevention mechanisms to moving with cementing and casing and the like. we have proposed in the last two years budgets efforts to expand the number of inspectors that we

have at mms and we're moving forward with the reorganization of mms now into the bureau of ocean energy enforcement and regulation and that is being done under the leadership of michael bromwich and wilma louis. both hav incredible credentials as prosecutors, as well as inspector generals and they were chosen by me to run the agcy in large part because of the ethical improprieties which this committee and which the inspector general had uncovered and so we have been wking hard on making sure that those ethical lapses are not there and understand there's still significant reform we have to undertake in the days and months ahead and we will be focused on it and likely look forward to working with you, chairman, kkman issa and members of this committee to make sure the new organization ultimately gets it right. let me finally -- i know some of you will have questions on the moratorium. i will be delighted to answer

those questions and finally just in terms of what i hope the legacy of this crisis is, i would hope that as we learned lessons from this crisis that at the end of the day we'll look back at this time and we'll say that we have together as a nation developed safer oil and gas production in the outer continental shelf that does, in fact, protect the environment and protect the safety of the workers. i would hope that we can move forward as a nation and say that we have restored the gulf coast to a place that is in a better condition than it was before april 20th and i would hope that we are able to move forward and embrace the new energy future of america with a much broader portfolio that includes solar and wind and geothermal and all the rest of the portfolio part of the renewable energy initiative of president obama and members of this coness. thank you, mr. chairman. >> thank you, secretary, for your statement. mr. bromwich? >> thank you very much. chairman town, ranking member issa and other distinguished members of the committee it's a pleasure to be here and to testify before you and to answer

any questions you may have. as the chairman noted and as the secretary noted i'm new on this job. i've been on the job exactly a month yesterday. as head of the newly renamed bureau of ocean energy management and enforcement. the change of name was made by secretary salazar with a point, which was to stress and emphasize the regulation and enforcement part of the organization's mission that many people have fairly suggested has been ignored or neglected in the past. let me focus very briefly on three things that we've been doing since i got there. numberone, on the second day after i was named director with secretary salazar's approval, we created an investigations and review unit within the organization tt will have several primary functions, but the principal function will be some self-policing. it will be authorized in

conjunction and cooperation and communication with the office of the inspector general to do investigations into ethical lapses into misconduct and so forth. to my surise there has -- there had been not been that capability within the organization previously. i believe that any healthy and robust organization should have that capability. this organization now has that. second, that unit, the investigations and review unit, will spearhead in a heightened enforcement program that will be focud on oil and gas companies and that will launch aggressive investigations in those cases in which there are allegations that the rules have been violated. too often in the past i've heard and i fear enforcement has not been vigilant. it has not been aggressive. that will change. finally, as the ranking member and the chairman noted there have been many, many revie and investigations by various entities including the office of

the inspector general, gao and so forth. one of the duties of this investigations and review unit will be to follow up on those reviews to see whether the remedial steps that should have been taken and where statements may have been made that those remedial steps had been taken, whether they, in fact, have en taken. so that kind of follow-up work will be a central mission of the investigations and review unit. next subject i'd like to touch on briefly are the new regulations that have already been implemented and that will be implemented in the future. following the deepwater horizon blow-out andhe 30-day safety report that the secretary mentioned, a, a new safety regulation ntl-5 is issued binding on the issue and followed by ntl-6 a more environme environmentally oriented regulation. these are tough, new rules and regulations that govern oil and gas companies as they do work in the outer continental shelf and i think they are fair and

appropriate new rules and regulations. there are other rule makings that are in process that are in part the product of learning that has gone on in the interior department, both previously and that is going on in an accelerated way over the last two months and we hope to be putting out those rules in the near future. again, i think we feel that those are necessary and appropriate. finally, the secretary mentioned briefly the moratorium. one of the charges he gave me in connection with the moratorium issued on july 12th was to conduct a series of public forums around the country to gather information on three central issues. drilling safety, spill containment and spill response. with an eye to gatring as much information from industry, from academia, from stakeholders and ngos and environmental groups to determine whether there are ways in which the moratorium might b shortened before the novemb 30th current expiration date but

generally to learn as much as we can on what additional measures need to be taken on those three dimensions to ensure that when deep water drill something resumed it's done in a safe and appropate manner. we will begin those meetings starting august 4th in new orleans. we will follow those with a series of meetings in mobile, alabama, pensacola, florida, santa barbara, california, anchorage, alaska, biloxi, mississippi, houston, texas, and lafayette, louisiana. those will be conducted between august 4th and september 15th with them to report back to secretary salazar with the results of those forums no later than october 31st. it's a lot of work but a lot of important work and we look forward to doing it and i look forward to working with you. thank you very much. >> thank you. thank you for your statement. let me begin by secretary salazar. will you commit today that the

reorganization process will be transparent and this committee will be provided with all the critical details? >> yes, we will absolutely be working with the committee, with members of congress relative to legislation on the reorganization as well as the keeping you up to date on the implementation of the new organization. >> now, the reorganization, i want to know how will the reorganization help to prevent further future disasters. >> well, first in terms of dealing with some ofhe ethical lapses which i agree have been abhorrent in the past and which this committee appropriated pointed out as well as our inspector general in the department of the interior, we are dividing up the agency into different units, so the revenue functions of the fmer -- wha were formerly in the mms will move over into an office of natural resources revenue, so

the dollar collectors will be separated from those who are in charge of granting the leases and doing the enforcement. the rest of the agency, which director bromwich will oversee will be split into a bureau that essentially manages the resoce out in the outer coinental shelf both conventional as well as renewable and another unit that esntially will be in charge of safety and enforcement so that's the essential concepts around the reorganization to ensure first of all that conflicts of interest are avoided in the future, the kinds that you have pointed out in your investigations and, second of all, that there is a kind of enforcement with respect to safety and environmental requirements. >> you know, the gao and, of course, ig have made numerous recommendations to improve royalty collection. have you implemented any of these recommendations or -- up

to this point? >> mr. chairman, the answer to that is we have in major ways relative to the elimination of the royalty in kind program. we were also looking at other ways in which we can provide a more effective calculation of royalties and have been working at putting together a program so that the american taxpayer receives the returnrom the royalties or from oil and gas production that the american taxpayer deserve. >> let me ask you, have you looked at the turnover process in terms of people that work for mms, you know, moving on based on the fact that they're so poorly paid? >> we -- the revolvingoor issue is one that has troubled us and one that we are working on, you know, it is my personal view if you have been an mms director you ought to not go out and work with the industry, but

i will have michael bromwich, if i may, mr. chairman, just quickly answer that question because it's something that we have focused on. >> i think it's a serious issue and serious problem. there have been historical problems in recruiting qualified inspectors, and many of the qualified inspectors do come from industry, and then seem to want to go back to industry. now, it's my view that we can do a couple of things about that. one is to create tighter rules to ensurehat if people who are agency governmt inspectors do go back into the private sector, that at least they don't deal directly with the agency that they just left on any of the matters that they worked on and for some period of time, perhaps not deal with the agency at all. so that's one set of issues that we're in the process of addressing. i thina more fundamental issue, though, is how do you enlarge the pool of qualified inspectors? one of the things that i've begun you

enlarge the pool of qualified inspectors? one of the things that i've begun conversations about is is talking to some of the schools of engineering around the country to see if we can develop recruiting programs so that this becomes a desirable public service career path. let's recruit the best and the brightest out of some ofhe petroleum engineering schools around the country. people who have no prior ties with industry and let's make it a sustainable career path so that they're not tempted by more dollars in the private sector, but they can make a decent living serving as a qualified inspector. so i had a conversation yesterday with the dean of the school of engineering at uc berkeley and they said there are a number of engineering dea around the country who are interested in working with us on precisely this point. so we're in the beginning stages of this, but i am hopeful that we will have robust alternatives

to the bacand forth revolving door system that has existed up until now. >> that's very encouraging, and i yield five minutes to the ranking member, congressman issa. >> thank you, mr. chairman. i would like to do technical house work. mr. secretary, your staff up until last night told us that there was a policy which they would not provide in writing that you only deliver document request to the majority and the majoty has been kindly making copies and giving them to us. however, under ranking member waxman and the bush administration we never saw such a policy and we were not able to get it in writing. would you pledge that both the rest of the discovery would be coming which you said before the committee hearing started, but also that the discovery one transparent to both sides. that the chairman might have requested it slightly different than we have, but what we request would be granted to both sides at the same time rather than relying on someone to go through and try to make an

effective copy rather than you knowing that you delivered both sides the same information. >> congressman issa, we delivered thousands of pages of documents both to the chairman as well as to you and we're working with you to try to get all of the additional documents. >> and i appreciate your participation and your promising that. it was actually more technical than that. until last night any documents we got we got because they were delivered to the majority and not to the minority and the minority made copies and that's not a normal practice from government. each of us has number request and usually they're shared by delivering them either to the person who requested them if only one requested, but in most cases administration delivers to both sides so that both sides know exactly what is is being delivered. this was troubling when particularly last night your votes suddenly changed probably because you were going to be

here and wanted to get more copes and got it independently and copied to the other. congressman issa, we will follow the processes that the department of justice and others have required of the executive branch of government. my view is is that transparency is portant. we have provided tremendous documents to this committee and will connue to work with you to provide you the information that you need so that you have absolute information relative to what it is that you're seeking. >> i won't belabor the point. i trust that if you gave it directly last night you will continue to give it us to directly and not the way your staff decided to do it prior to that time. the -- the questions i have are a number, and i'll try to be brief. . the culture at mms, we can talk

about changing, mr. bromwich, i'm looking forward to helping change that. in our earlier investigations, one of the things we discovered that not only was this organization cozy. it was inept. now maybe what you owe and what you owe, mr. secretary, the portion that was collecting the money completely relied on the energy companies to deliver how much was owed from where. that there was no independent accounting and that no audit ever basically found a different number meaning if kerr-mcgee when they were still in business said we got x amount out and delivered x amount of dollars, they just took the money and recorded it, that they had no independent ability to know that was the right number or not. do you, one or both of you have plans to implement a system so you can independently discover how much oil or natural gas or other resources are being taken out and verify them. not just take the word of the

good players and the bad players alike? >> the answer to that, congressman issa is yes. we have done it with bp. y we sent them a notice for $5 million with regard to payments on an onshore activity and secondly, with respect to the office of natural resource revenue which we have created, there will be the auditing function so that we can do that independenter have if er have v. >> i agree with you. that's an unacceptable system. the secretary has said that's been cnged and you cannot rely on a regulated entity to report without checking that, auditing it and coming up with an independent assessment. >> i appreciate that. very quickly. a i might suggest that every year the corps of engineer have a

number retiring and i would hope that you look at both ends of the spectrum and those coming directly out of universities that have never worked with oil companies and perhaps senior engineers who have 5, 10 or 15 good years to give that also are not tainted by an ambition to work for seven figures for an oil company. >> think that's a great idea. last week we found out there was a pool of people on the coast guard called warrant officers that have useful experience that we can count on. so i think there are pockets of experienced personnel all over government that people just haven't thought of tapping into in the past, but that they'll try to tap into now. >> thank you. >> the gentleman's time has expired and now yield to the gentleman from ohio. congressman kucinich. >> thank you very much, mr. chairman. i indicated in my opening remarks that i had some questions about the way that the minerals management service handled the british petroleum

atlantis platform issues in the gulf of mexico. i was one of 19 members of congress who signed a letter to the mineral management service back in february 2010. this was about -- mr. bromwich, this was two mont before the deepwater horizon incident. miss birnbaum, the former director, received a letter with bp atlantis' platform. we requested an investigation to verify a whistle-blower claim that 90% of the final construction plans of the platform, almost 7,000 plans were never approved. so if there's an accident in that rig there would be no plans for response teams to use to try to deal with it though i am

happy to see that an investigation is under way, i am concerned that it is not expected to conclude until september. it's important to keep in mind that this platform is in waters deeper than the deepwater horizon platform and bp's own worst-case scenario for a catastrophe with atlantis would put over 200,000 barrels of oil per day into the gulf which is about anywhere from four to ten times the size of the deepwater horizon catastrophe. my first question, mr. bromwich, is whether bp would be found in violation of the law if it does not maintain certified as-built drawings on file? >> i don't know the answer to that. let me get back to you on that. my intuition is that the --

>> i'm disappointed you don't have the answer to that because that's your job. the answer -- i'll give you the answer. the answer would be yes. i am told it should not take that long to review the plans. that raises the question that the plans might not even exist. i'm concerned that atlantis is the rule and not the exception. given what we know about the horizon accident and how bp atlantis does not have engineer-certified documents for its subsea components as required by law, wouldn't it make sense for the bureau, for ocean energy management, regulation and enforcement to close the atlantis project as well as any deepwater drilling production operations in the gulf that lack final plans until an independent third party is proving that they are operating with complete sets of engineer-approved drawings for the above and below-sea

component, mr. bromwich som congressman, you are correct that there is an investigation ongoing. you are also correct that it will be completed by the end of september. i am advised that there is a letter on its way to me that ll update you and other interested members of the committee with what i anticipate will be preliminary results of that investigation. the truth is i have spent the bulk of the month since i came onbod dealing with various offshoots of the deepwater horizon matter. so i am not as fully aware of the atlantis matter as you would like it to be, but i will make it my business to become more knowledgeable about it and be happy to tal to you about it further in the near future. >> mr. bromwich, i appreciate that response, but it would be useful to you to revw the letter sent back in february, february 20th, 2010, signe by 19 members of congress including myself which provides a very powerful warning about the consequences of not having an

propriate inspection of the issue relating to engineering plans at that bp atlantis platform. >> i will review that. >> you understand the concern. you are dealing with a catastrophe from the lack of appropriate oversight at deepwater horizon. what i'm maintaining to you and what other members of congress have all joined together in asserting is that lack of appropriate oversight also exists with respect to a bp atlantis platform which could have even more catastrophic implications than the deepwater horizon disaster. i thank the gentleman. i yield back. if i may, mr. chairman, congressman kucinich. i may want to supplement with what director bromwich said by saying the investigation is under way and he will keep you posted as to the results of the investigation. number two, we have sent

inspectors out into the gulf to look at the drilling as well as the production platforms and so there is an ongoing inspection effort under way and number three, one of the things that should come out of the lessons learned here is you cannot have 60 inspectors having the responsibility of conducting the massive job that has been assigned to these inspectors and that is why there is a budget amendment in front of the congress to beef up the level of inspection and investigation capability within the agency. >> mr. chairman, i just want this committee to be on notice that we've got to find out whether bp has certified as-built drawings on file. th is a serious matter especially in light of deepwater horizon. thank you. >> gentleman's time has expired. i yield five minutes to the gentleman from florida, congressman mica. >> we appreciate you being here, mr. secretary. i raise some questions in my couple of minutes of the opening

statement. i think everyone has to be baffled by the administration's development of policy. you were one of the first people nominated, i think back by the president. people were pleased. we had someone from the congress and your experience from the position. so you came in in 2009. you had an opportunity to develop budget and policy, i would imagine, and i was kind of shocked again when the staff gave me the budget and it showed cuts like $2 million in the mineral management environmental permit activity that was proposed by your agency. did you participate in making decisions on that or again, the primary agency for response in ese kinds of disasters would be the coast guard. the administration proposed 1100 positions cut -- cutting assets, ships, planes, helicopters, all of the things that you would use in a response. were you part of the decision to

make those cuts either in your agency? maybe not coast guard? >> congressman mica, with respect to the budget that ha been submitted to mms. if you look at the ten-year history of the budget. there had been erosion within the department of interior mms as well as with all -- >> with -- >> let me just finish, with respect to the other agencies in the interior including mms, a very snificant erosion after we came onboard. you will note that the inspectors that are set forth in the budget for mms are a significant increase from what habeen there in the past. the question that was appropriate for this committee and for the congress is that number sufficient and in our view it is not. we have to have additional capacity. all i can go by the budget asked is is if you were there when the decision was made to cut the environmental review activities which also reviewed permits and then the next thing is this is

february, it came out. in march did you participate in the decision to expand drilling in the gulf and other areas? >> the -- >> were you consulted? is there any documentation? >> not that i was consulted. it was my decision, and it was my plan and it's a plan that i am very -- that is a very well-thought-out plan relative to moving forward in a thoughtful way that changes the direction that we were going on in the oc is that does different things with respect to what was being planned on the atlantic and the -- and the different things that was being planned in alaska and brings in the kind of environmental reviews that are necessary. >> again, let's go to that. you were there when they issued this one-page permit and this is the permit to drill for bp, one-page. this is backed up by a 500-page

cleanup spill plan. i'm sure you didn't review this, but you told me that people who are responsible in all were fired and people changed. have we got that organization chart? the guy that was responsible for signing this. we've got two people here and tolbert signed it for saucier. he's still there. he's got that circle there, that yellow thing. so he wasn't fired. he gave carte blanche. this is the approval for bp to drill and the conditions by which they drill and it referred to a 500-page document. that 500-page document i've -- my staff tells me it has bill provisions for seals and walruses and polar bears. none of which i have in the gulf. it looks like this is all sort

of carte blanche approval. is that what it appears to be? and is this guy going to get fired or anyone -- and this guy is still making the decisions. this is saucier and here making the decision on implementing the moratorium. >> congressman mica, let me respond with two points. first, while it is true that people committed both criminal and ethical conduct that is -- wrong -- >> and he is responsible -- >> let me finish, congressman mica. the reality of it is that there are very -- there are many good people within the agency. there are some bad people and those are being dealt with. with respect to the document that you're referring to and with respect to people that were involved concerning the approvals of the ma conneda wells, i have asked the inspector general to take a look

at that and they have taken our own independent review which we'll be happy to share with members of this committee. >> i appreciate a list and the status of those ld responsible. thank you. maybe we can submit that to the committee. >> without objection. >> now i yield five minutes to the gentle lady from california, miss beard. >> thank you, mr. chaman. thank you to the secreta and mr. bromwich. a series of questions. from the outside there is an ethical crisis at mms, whether you change the name or not, there has been a history of drugs, sex, rock 'n' roll concerts and i am concerned based on the post article today that says there is a much higher degree of revolving door that exists in the oil industry than anywhere else in that three out of every four lobbyists had some relationship to the government.

we know there are 12 former employees of mm is that are now lobbying for the oil industry. mr. bromwich and secretary, i would like to know what you're going to do now to freeze out those 12 former employees from interacting with mms? >> well, we will certainly make sure that they observe the current ethal rules that exist, that restrict their contracts to some extent, but one of the things i have to do is to gather information from people who have the information, if they happen to be former employees of the agency. i'm not going to exclude them for that reason, but i'm certainly not going to give their information any more weight than anyone else's. i agree. i read the same article you did and i'm troubled by it. i think what i can tell you and tell the committee is that you'll never see me in that position. i'll say right now that i'll

self-impose a lifetime ban on contacts with the agency, and i hope that sets an example for other people in the agency and other people throughout government. i agree it is unseemly. >> i guess from our perspective, can you take action independent of congress passing a bill to restrict former employees from having access to the agency? >> well, let me give you an example. i've actually met with two of the former directors who are now part of trade associations within the last couple of weeks. >> that was at your request. >> no. it was at their request, but i am in the business right now of trying to gather information from a variety of sources, including from trade associations because they have relevant information to provide bearing on some of the issues that the secretary and i are working on. i'm goin to give them a hearing, but i'm also going to give all other groups including environmental groups, including -- >> i understand that. i have a limited amount of time. >> okay. >> my question wa can you act

independent of congress in creating someestrictions around access to the agency after employees have left? >> yes, we can, but we need to do it in a thoughtful way. >> so you report back once you decided what you will do with the committee? >> sure. >> the gao report to this commit i indicated that the revenue share the government collects for oil and gasroduced in the gulf rank 93rd out of 104 revenue collection regimes around the world. i think most of us find that stunning and shocking. what are you going to do to change that so that the royalties being received from the gulf are reflective of the world as a whole. at least the international average of royalties received around the world? >> congresswoman spear, let me just say that the royalty issue

in getting a fair return to the american taxpayer is foremos in our minds. we have been working on it it. we have been working on it and we have ways to change how to make the american tax payer is getting a fair return on royalties, not only on the offsho, but also on the offshore when you have a circumstance that is worse when you have the same royalty rate that existed since the 1920 mineral leasing act at 12.5%. so we are making the kinds of changes that will bring in the right level of royalties and at the same time make sure that there is accountability with respect to the auditing functions relating to that. >> and when will those be put into place and do you need congressional action to do that in. >> we e working on it. we are moving forward with it. it is being put into place as we speak. the royalty was part of that effort. >> that's good news to hear. one last question.

my understanding along with congressman mica's reference is that this particular 600-page document was reviewed by two people for a total of ten hours. so by anyone's measurement it was inadequate. i don't care if you're a speed reader, there is is no way that in ten hours you canive the kind of attention to that document. what are you doing moving forward to make sure the employees doing that kind of review are both qualified and have adequate amount of ti to do the review? >> with the reorganization that we have put on the table and the resources that we have asked from congress to be able to do the right kind of work in ensuring safety and ensuring environmental protection should address those issues. >> the gentle lady's time is expired. i yield to the gentleman turner. >> thank you. mr. secretary, i have a few

items on a timeline that lead up to the explosion in the oilfield and the oil leak. i would like to go over some of those items and get your responses. we focused a lot on what happened after the explosion and i would like to focus on the period leading up to it. i would like the teline included in the record. the timeline begins with january 29, 2009, and the secretary being declared and the secrary is appointed on that date and declares himself the new sheriff in town. this is january 2009. in february 2009 in a site-specific exploration plan filed by bp, it states that it was, quote, unquote, not required to file a scenario for a potential blowout of the deepwater well. march in 2009 as we have a new sherifin town, a whistle-blower brought forth an issue of a safety brea by bp in the gulf of mexico to the attention of mms.

quote, the whistle-blower who was hired to oversee the company's databases that house documents related to its atlantis project discovered the drilling platform had been opered without the majority of the engineer-approved documents that needed to run safely. no action was taken by the agency, but the most important thing was two months after the whistle-blower came forward in may 2009, mms fails to perform a standard monthly inspection of the deepwater horizon. what happened in the secretary's office in may 2009, our interior secretary is speaking at the wind energy conference in chicago. june 2009 mms proposes new rules to require oil and gas operators to require and implement safety and environmental systems for offshore drilling. the rule is still not finalized one month and one year later. in june of that same month these rules were provided, but not finalized. secretary salazar hires silvia

baca away from bp america to become his deputy assistant secretary of land and materials management according to this timeline. summer 2009, the mms awards transocean's u.s. gulf of mexico operation a safety award for excellence and our secretary directed mms to begin focusing on promoting wind energy. elizabeth birnbaum assumes duties as director of mms. the new york times recorded that quote nr particularly and tasked with handling the issue of the 25-mile cape wind farm off of cape cod. what happens the next month august 2009, mms fails to perform a standard monthly expansion of deepwater horizon. august of that same month, white house -- at the white house's request, secretary salazar takes a break from her wind energy efforts to begin the big effort of selling health care reform. august 2009, you traveled throughout the west to tout obama's stimulus plan.

i understand from this timeline that on the 21st of august that you re in grand canyon south rim on the highlighting 10.8 million stimulus dollars. 8/20, you were in utah. $3.6 million stimulus dollars and on the 20th you were in oregon on stimulus dollars. the very next month the national oceanic atmospheric administrati sent mms a letter about the offshore drilling proposal saying mms understated environmental impacts of the new drilling oposal. september 8th of that month, salazar says during an interview at reuters says root now we are focused on health care reform. in fact, krshs reports in november 2009 that aicipating a struggle the white house deputid ken salazar and former senate mority leader tom daschle to join vice president joe biden in trying to clear the way for healthcare bills

overhaul of the next few weeks, but mms is is busy. mms has a renewable energy task force meeting in rhode island, massachusetts, and new jersey and with all of this activity happening in november, what happens in the gulf in december? december 2009, mms fails to perform the standard monthly inspection of deepwater horizon? they again failed to perform the inspection in january and then through a series of notifications that bp provides to the agency, the ecifications from deepwater are continued to be adjusted. mms responding in seven minutes to one request for modification, 4.5 minutes to another after having routinely not shown up for standard inspections and in april, the deepwater horizon rig plodes and then sinks, and i believe the secretary is there by april 30th after attending on

april 27th, participating in a ceremony on wind turbines. april 28th, announcing the approval of the cape wind project and then your atending in the gulf to take a look at what has occurred. >> the gentleman's time. >> a significant amount inactivity. >> the gentleman's time has expired. i believe my staff has a copy of the timeline which i can also provide to you. >> mr. chairman respond even thoughhe gentleman's time has expired. the fact is the united states department of the interior has a major mission to protect and preserve the natural resources of america both onshore as well as offshore as well as being the custodian of america's mission and on that mission we work on the set of issues relating to native americans and although the other assignments that we have within the department of the interior. specifically with respect to

many of the things that you cite in there, i have spent probably more time on the comprehensive energy program for the nation that the president and i have been championing than on almost any other issue, b i can tell you within the comprehensive energy plan, we are confident that we will see and fold for this nation that we will have a broad energy portfolio that will include oil and gas and at the same time include the new energy frontier of solar, wind and geothermal that we have worked on very hard. i will say this to you, mr. turner, that without eqvocation, we have spent a huge amount of time with respect to all of the issues relating to mms and they have included changing the ethics culture moving forward with a new direction on the shelf from what was leftverrom the prior administration and moving forward to standing up, a renewable energy program. so we work hard.

we cover a lot of ground and we have a lot of ground to cover in the future. >> thankou very mu, the gentleman's time has expired, ani now yield five minutes to the gentleman from california, ss chu. >> thank you, mr. air. we know that the blowout preventers failed with bp with enormously tragic consequences. it's my understanding that an inspector does not actually have to witness in person the blowout preventer test, but can simply review paperwork from the oil company operators and they can basically take their word for it. we know that these tests can be successfully faked as illustrated by several ces. this practice is just unimaginable and cuts corners and compromises the oversight of the validity of the test. so how -- how was the reorganization of mms work t improve these inspection

practices and what specific improvements do you anticipate making to make the bop test effective and what are your thoughts about having these types of tests certified by independent third party inspectors selected by federal regulators and not the oil companies? >> congresswoman chu, it is a very good question and something which we have been working on that relates to two parts, the reforms within the ocs and the first of those is having the right standards in place and many of those standards were set forth in the 30-day report which president obama directedhey deliver to him. many of those standards are being implemented with respect to the notice that director bromwich spoke about a little bit earlier and then finally with respect to the enforcement of those standards there needs to be a significantly beefed up effort with respect to the agency's inspection capabilities

because right now it is a fool's errand to think that inspectors can essentially come out and inspect all of the different ocs facilities including production facilities that are out there. >> so you will be coming forthwith new regulations pertaining to this particular practice? >> yes. >> well, then it leads to another question which is about new regulations and one of the problems with the current regulatory system is that it takes a long time for any improvements and in fact, it took nine years for regulations related to pipeline safety toe work its way through the process and take effect. so how will the reorganization of mms work to resolve this issue of delayed implementation of new and necessary regulations? the reorganization itself, there will be two parts essentially

dealing with the shelf beyond the revenue site and one of th will be to provide the safety and enforcement and we will make sure that we are moving forward to address all of the issues and all of the lessons to be learned from this tragedy. >> but my question is how long will it take and what will you do to make sure that it's accelerated? >> congresswoman chu, i think some people might say that we should have waited for another six months, eight months until we found out exactly all of the results of all of the investigations. our view from day one has been that we would work on the issue as fast as we can and so the 30-day report that was delivered to the president is the report thatas many rules and requirements and standards which are already being implemented and some of them notice the less sees and some of them through rule making that will be conducted by director bromwich.

>> finally, let me ask this. under the two interior department regulations, oil mpanies use models developed by mms to predict the oil reaching the shore following a spill. in the deepwater horizon case, these models incorrectly predicted that there was a 0% likelihood of oil reaching both shores in florida, alabama and louisiana. it suggests, of course, tt these models are outdated and that the regulations relating to the oil response plans need to be revisited. so my question is does mms need to re-examine all of these oil spill response plans particularly wh regard to these kinds of predictions which are clearly incorrect and way off and how will the mms reorganization help this process? >> the answer is yes on drilling safety and containment measures and oil spill responsibilities and i would like director

bromwich to comment on that as well. >> you are quite right, congresswoman, that the oil spill response plans are plainly inadequate and that is one subject on which i will be gathering information on the public forums that we will be holding over the next month and a half with an eye toward not only insisting on the short term for regulations that thos oil spill response plans be substantially revised if they're going to pass muster, but also with an eye toward getting out new regulations in the future and wel ke sure that that's the standard from now on. and you're reviewing all of the plans? >> yes. >> gentlewoman's time has expired, and i yield to the gentleman from tennessee and let me also wish him happy birthday. >> well, i have the honor of sharing a birthday yesterday th the chairman and he sent me a note saying that he thinks we should make it a national holiday. >> that was a very nice note.

mr. secretary, thank you for coming here. i've sat through hearings i the transportation committee and the resources committee on the bp oil spill and in both of those hearings theitnesses have mentioned that over 40,000 wells have been drilled in the gulf since 1960 and my staff got information from your department earlier today saying since 1947 more than 50,000 wells have been drilled in the gulf of mexico and it's -- would you not agree it's an -- it's almost an astonishingly safe, clean history that we have there in the gulf? i mean, there have been almost no -- there's been anything even close to this bp spill. in fact, i' told there are more spills out of ships than there are from these rigs. >> congressman duncan, i agree

with you. in fact, i think it was that history of safety over all of those times, 50,000 wells which essentially was the imperical foundation upon which the national framework has been built with respect to the oil and gas production in the outer continental shelf. >> i am told there are now 3600 structures in the gulf right now. governor engler wrote a column for "the washington times" a few weeks ago and says drilling moratorium is a jobs moratorium. he said the moratorium immediately shut down 33 deepwater rigs in the gulf including 22 near louisiana. this action could cost 3,000 to 6,000 louisiana jobs in the next two to three weeks and potentlly 20,000 by the end of next year. for every one employee on an oil rig, there are nine employees onshore supporting that one

employee. that's -- that's my main concern because not only did i read this by governor engler, but repeatedly, i've seen on the ws reports that these oil workers in the gulf area are almost in a panic situation about all of the thousands of jobs that are being destroyed and are to be destroyed. >> congssman duncan, let me just say that we, too, are concerned and we are aware of the issues of our view and my view in issuing the moratorium that it was th right way to move forward to put the pause button in place until we can answ three fundamental questions. drilling safety and blowout containment capability as well as oil spill response capability. if we were to have another one in the gulf of mexico today or next week, we could not have the oil spill response capability to deal with those blowouts.

the effort which exxon, shell and chevron and conoco phillips came up with yesterday is the beginning point of that conversation relative to how we address one of those three fundamental issues and director bromwich's set of meetings will help us answer those three fundamental questions so we can determine how to move forward with respect to the pause button in place. >> on another int, the columnist and commentator whoi think almost everybody agrees even if they don't agree with him, they think he's one of the smartest men in this city. he wrote recently, environmental chic has driven us out there. he asked why we were drilling in 5,000 feet of water in the first place. en inchmental chic has driven us out there, they have rendered the pacific and nearly all of the atlantic coast off limits to oil production and of course, in the safest of all places on land, we've had a 30-year ban in the arctic wild life refuge. i've seen articles that say

something like 83% or 84% of the ntinental shelf is off limits to oil production and that -- that also is a concern of mine and then finally, before my time runs out i'll say to mr. bromwich, i'm concerned we've changed the name and there seems to be a goal of emphasizing enforcement, and i'm just wondering, are we going ve a gotcha-type agency now? because most of these companies, let's forget about bp. let's consider them a bad actor, but most of these companies are doing a good job and complying with all the laws. >> i agree with you. we're not going have a gotcha culture, but we're going to have clear rules and we're going to have aggressive inspections and violations of those clear rules will be dealt with severely. i think that's the right kind of regulatory regime to have

>> if you find a violation are you going to give the company a chance to correct it or are you immediately going to come down on them and shut them down? >> that's a fact-specific determination and we'll have to take it on a case-by-case basis. >> the gentleman's time has expired. i recognize the gentleman from maryland, congressman cummings. >> thank you very much, mr. chairman. secretary salazar. one of the things that we are -- that we had with the coast guard sub commitet and transportation committee and one of the things that we were concerned about is the -- what role do you all see the coast guard playing in the future? you know, the legislation passed by the committee on transportation infrastructure will require much more significant role for the coast guard and the approval of the oil spill response plans which is crucial given that the coast guard is responsible for managing the response to the spills. so what steps, if any, mms and

the ast guard taking now to strengthen the role of the coast ard and by the way, that's been one of their complats that they're asked to be responsible for overseeing the cleanup, but they don't have enough say in creating the plan. did you know that? they've actually testified to that. either one of you. >> congressman cummings, if i may, the role that we have seen play out with respect to the response with the deepwater horizon blowout and the bp oil spill has been one that we have been working with hand in hand with admiral allen as the national incident commander and it's been continuous. we will look back at the deepwater horizon tredy and look at the lessons learned including the capacity that are out there with respect to the coast guard and others, but the

fact of the matter is the relationship in terms of the structure has been set up to respond to the oil spill response has worked well between interior and the coast guard and other agencies that are also involved. i've got to tell you again, we've had testimony within the last three weeks and i will get you that information where they have told us that they want -- and this is not admiral allen. they nt more say in the development of the response, the emergency response plan because they just feel like, by the time, if you're going to call on them to oversee the cleap, they should be more involved than in the beginning. i'll get that to you. you might want to take a look at that. i'm surprised you didn't know that. >> let me say this, congressman cummings. the fact that the oil spill

response issue is is one of the three most central issues that we're looking at and that issue will necessarily involve -- should involve and will involve, i will make sure it happens, a close collaboration with the coast guard because we're not going to move forward until we have an assuredness with respect to the adequacy of oil spill response plans. mr. secretary, although the deep-water horizon was registered in the republic of the marshall islands, has testified before the joint mms coast guard panel saying that the rmi as a flag state did not inspect the drilling equipment & on the deep war. he indicated that such inspection are left up t the mms and we understand that mms often relies on key tests and

that mms inspectors only review the paperwork associated with the text. hows it that adequate -- how can we make sure that we have adequate -- that is, approval of these -- of these reports? because there's a question of inspection that some of the inspections are not actually done by our people, but they're done by the marshall allen folk and people they contract so how can we guarantee that those inspections which are so important are properly done? >> let me say first there were inspecs conducted of the deepwater horizon including inspections in april and testing including of the blowout preventer that occurred in the days leading up to the explosion. secondly, we will have a significantly more robust inspection regime and it's part of what director bromwich will be working on and he may want to

comment on that. >> that's absolutely right. those are one of the things we'll be focusing on most intently. the important inspecinspections to be done by human beings and human beings with experience and demonstrated competence and an arm's length relationship at least to the entities that own the facilities. >> i see my time is up. thank you very much. >> the secretary has got leave at 12, and i'm going to try to get in as many members as we can before they have to leave before they go to vote. mr. burton, five minutes. >> you know, 50,000 wells have been drilled in the gulf without a problem, and yet the president put a moratorium on the drilling, and as a result you've had some of the rigs go to egypt, to the congo. in canada they're talking about

new wells digging up to 6,000 feet and we'll lose the wells and they'll probably not come back for a long, long time. it makes no sense to me to cut off the drilling in the gulf when you've not had any real problems except for this one catastrophe, and i just don't understand why the administration has taken this carte blanche approach. can you explain that? >> congresan burton, having been involved in this matter in response to the deepwater horizon blowout every single day since the blowout, i can tell you that there are three fundamental questions that have to be answered before we take our hand off the pause button d those are the issues of drilling safety and oil well blowout containment as well as oil spill response capacities

that's what we are working on with director bromwich as well with a whole host of other efforts. >> you've already stated that there's more of a chance from a leak of a tanker than there is from one of these rigs. it just doesn't make any sense with a ,000 drilling of wells in the gulf and you have one spill that you will cut off everything and the rigs are already moving to bzzaville and the congo and we sent them to drill in deepwater areas. so what we're doing, in effect, is shoving oil production away from the united states and we're costing us jobs when there is really no reason for it except for this one exception and what you're talking about, in my opinion, it doesn't make a great deal of sense. i want to ask you a couple of other questions really quick. i have a video i would like to show you really quick. it's about 15 seconds long. so can you cue up that video?

>> salazar and nap alton aeapoa been on the islands three times. >> it's a photo-op? >> i don't know. >> do you have contact on the stock level? every time napolitano and salazar has come on to grand isle they go on a boat or helicopter and something like that. they've never met with local homeland security. i don't think they've met with anyone in town. she drove past me last time and i was standing at the airport waiting for you to come in and she drove right past me. >> well, this is dino bonano who is the homeland security director down there andhe fire chief mark scardino. they said you've never been down to that parish and that's one of the most toxic areas that's been hit since the spill took place. why haven't you been down there?

>> congressman burton, first of all, we believe that the last count that i saw had 11 times that we had been i the gulf coast states -- >> this is one of the hardest hit. >> i have been through louisiana, alabama, mississippi, florida. i don't know the exact parish by parish, but let me just say since april 20th and even before that, i spent a lot of time on the gulf coast and i continue to spend a lot of time down there and will and will work relentlessly on this problem until we get it fixed and we charge the way forward -- >> it seems like this would have been one of the top priorities. i don't understand why you weren't there and they were complaining very vigorously that you had ignored their problems there. >> the president, the vice president and members of the cabinet have been down there countless times. my assistant secretary -- my assistant secretary for fish and wild life has taken 17 trips down into that area to deal with

these issues. >> you're the guy. you should have been there, in my opinion. the last thing i want to ask is inow the jones act was referred to. there were a number of countries that wanted to bring skimmers in as soon as this thing took place. we could have eliminated an awful lot of these ecological problems if those skimmers had been brought in. why in the world did we let the other countries bring in the skimmers as fast as possible. >> i disagree with you. the jones act has notept a single vessel from coming into the country, number one. we have a shortage of skimming vessels has not been an issue and the jones act was want an issue. >> why weren't they allowed in. >> thad allen and the national incident commander had been in charge. >> the gentleman's time has expired. thank you, madam chair. my intent wasn't to rebut my republican colleagues in the hearing, but given what was just

said about the exception of this disaster, it's like suggesting that 9/11 was an exception to air traffic control regulations and that we shouldn't react to that. the fact is that this has been an environmental disaster and the fact that we should look at the regulation a preep atly of oil wells in the gulf and i think it's very appropriate that the administration take the steps that it has to make sure that all of the wells are safe. i further heard my republican colleaguing that its lum tagdzs on onshore drilling and other parts of the country that is driving bp and others to go to the gulf upon i assume that they're making money in the gulf that the reason they have this in the gulf is because they have oil wells there and they're making money, is that correct? >> that's correct. the reason bp and other oil companies are, in fact, drilling is because they're making a profit in the gulf? >> that is correct. i would like to move on and i think the issue here is one

that's important and it goes back to the 2005 energy act and the issue of categorical exclusions. i am ncerned, as are others with regard to the number of categorical exclusions that we have seen for wells in the gulf, and i would appreciatef you would help us better understand how categorical exclusions are determined and whether or not bp advocated exclusively for categorical exclusions for the drilling operations in the gulf. >> congressman, let me just say, first of all that just back on the moratorium, it was a prudent position that we have taken and i appreciate the support that you echo for the moratorium because of the fundamental issueshat we do need to have addressed. secondly, with respect to the question on categorical exclusions, they appear at a time when after significant environmental analysis has been done because the process in developing a five-year plan, you do an environmental impact

statement before you issue and have a lease sale there's another environmental impact statement reviewed before a sale happens. the cegorical exclusion in the gulf of mexico which has been granted to more than bp. those occur in large part because there is a 30-day window of approval required by statute when an exploration plan itself is filed as part of the leasing and development process. sowe've asked the congress to extend that 30-day window to the 90-day window, and i hope that it is something that you enact in the oil spill legislation before you. >> when you say the 30-day window is in statute. when was that 30-day window implemented and why was i only 30 days and who advocated for the 30-day window? >> i do not have the specifics on when that requirement was put into the law, but i can get that for you. >> do you believe -- what is your opinion as to how long it

should be for the review? you said 90 days. is 90 days appropriate. 30 days i believe is too short, and i do think what we need to do especially in places like the gulf of mexico, you have tremendous environmental information and reviews that have been conducted and so we just need to make sure that the environmental reviews that are being conducted are worthwhile and that we're doing the right thing in terms of the aim of the environmental analysis which is to understand what impacts they'll be to the environment and the activity. >> do you believe there's been an overuse of categorical exclusions under the previous administrations and in the 30-day window is a primary cause of that? >> i do believe that there was an overuse of the categorical exclusions and indeed with respect to what we've done on the onshore under the bureau of land management is that we have changed that practice and obviously, we are now conducting

a comprehensive review with the council of the quality relative with the changes that will happen. >> thank you, madam chair, i yield back. >> mr. murphy? >> thank you very much, madam chair. i know wre about to go to votes and secretary salazar, you've been great to spend time with us. i appreciate your response to mr. burton's question we could be for days on end if we would play single individuals that were upset that one particular federal official didn't visit them. i think we're very lucky to have you in this position. so many of us hve been impressed by your immediate and robust response to this tragedy and mr. bromwich, you have a reputation as a no-nonsense adminirator in erything you've done, and i think you're the right guy for the job. i just have a couple of quick questions. one relevance of funding source is moving forward. the reorganization as you split

into three different entities will require more people in and of itself and three directors and three officers of congressional relations and we know that we need more people to do the inspection work. as you look down the road at how you think the agency should be funded and you look at a potential diminishing reliance on royalty payments. how do you expect that moving forward the new functions of these agencies are going to be funded? >> congressman murphy, thank you for your comments. we are in the midst of working with the appropriators in developing the budget amendment to make sure that the funding is there to be able to do the job. and the funding sources themselves they'll be part of the discussion to engage with congress on. >> with respect to royalty payments. do you hav ideas as to what

components will be -- continue to be funded by royalty payments or what components you no longer want to be funded with respect to those payments. that is part of the review that we currently have in the implementation programs that we are developing. and maybe i'll direct this question to mr. bromwich and i would be happy to have the secretary weigh in as well. one of the things that has been of great frustration to us is the technology that we're using right now to deal with this, bill. and the fact that we've had a fairly slow pace of innovation within the industry in developing new technologies to address spills. maybe it's moving a lot faster right now as we speak, but over a long period of time it's been relatively slow given the threat. can you talk a little bit about how you foresee either within your agency or -- or in putting pressure on the industry. how do we more quickly do we mo

oil spill disaster technology going forward? >> yes, it is a very good question. i think one of the things that this disasteras foecused people's attentions on is oil spill response technologies. it has been recognized by us and players in the industry. i think that is one of the reasons why yesterday we saw the four largest majors come forward with the outlibrarines of a pla deal with oil spill containment in the gulf of mexico. i think that this disaster has focused ople's energies and it will stimulate innovation. we will be directly involvedn that process. the proposal that was made yesterday is an interesting intriguing one. but we will want to review and

study it carefully. it is one that we, and you and the american public is going to need to have confidence in. >> mr. isa for five minutes. >> thank you, madam chair. just one quickquestion, you know mr. secretary that your decision was arbitrary. in light of what you said earlier today, would you say that resources that are freed up at the time of the kill of this well could just as easy be the end of the moratorium? as you said earlier, clearly there were resources that you didn't want to have not available as one in 50,000 wells happened a second time. but wouldn't a target of the killing of this well be just as appropriate for considering limited well-super viwell-super

back into exploration of the existing 22 rigs? >> congressman, i appreciate yourbservation and i appreciate the sense of urgency that you have that these issues be addressed. but there is a tremendous amount of work that will be unfolding. i will have a report back from the oversight safety board which includes great work from the in specker general and her staff that are focused in on these issues which is due on i believe on august the 15th. the academy will have a report more knme by october 31st. so, if there is a point in time between now and november 30th, where the three questions that i have already addressed are addressed our satisfaction, we will revisit that timeline. >> i appreciate that.

i yield the balance of time to mr. fortenberry. >> thank you for joining us today. this oil spill is an environmental ca tkcatastrophe. we must work together to make thur that the leak is continuing to be stopped and that the environment is cleaned up and that we work with the resources we have to make sure that this never happens again, in that regard, your reasoning for the moratorium is that our resources are currently deployed and depleted and in case there was a second spill like this we would not have the resources to work against it. but given that there is the potential for this leak to be permanently stopped in the near term, your consideration of that factor in terms of the moratorium deadlines i think is reasonable. the second point being given

that the resources that are applied are under intense pressure to move overseas and that this would cause more imported oil to come into our waters, mortane tankers that ar more dangerous than the drilling itself. is the moratorium timeline more risky? a related point is that all drill something not the same. bp was engaged in the riskiest type of drilling. is there a krarconsideration th those may be excepted as well given that the profile is lower? >> congressman, the answer to that is yes. and that is part of what the director will be gathering information on. there may be different activities and different zones of risk that might be allowed to go forward. we have made one of those

findings with respect to the sha shallow water drilling and there may be others as we move forward. >> seg men station of risk based on the actual hhistorical past,s of risk rather than a blanket moratorium? >> there may befor exame, differentiation between the expiration wells in the deep water and wells that are being drilled into already develop ed reservoirs that you know exactly what it is that you are drilling into as opposed to the exploratory type of wells. so those are the distinctions that we will be taking a look at in the months ahead. >> i think the last thing that we want to do is increase pressures for more water.

with that said, i want to point out that i visited the area recently. these people are exhausting themselves to save their way of life and the environment -- >> i think you are heard. >> your time has expired. >> i had a good video for you, but we'll have to do it at another time. >> miss maloney. >> thank you madam chair and i thank you both for your testimony the devastation of the bp oil spill has highlighted many problems in worker's safety and containment and oversight. but it has especially highlighted the missmanagement of the mms,he minerals and management service agency which if managed appropriately could bring in millions if not billions to our treasury from

oil extracted from land owns by the american people. under the current structure, the general accounting offices found that the mms should do a great deal more to improve the accuracy of the data used to collect and verify the oil royalties, and i have a bill in hr-1462, which would require the national academy of engineering to study and come forward with impro improvements and rem decisions of ways that we could more accurately collect the royalties on the production of oil. i would like mr. secretary, if you would reviewit and this could be helpful in defining it in a way that we could be more successful in giving the american people the taxpayers their just reward or their jt tax revenues or revenues from this oil.

according to the general accounting office report, that was given to this committee, the revenue share that the government collects from oil and gas produced in the gulf ranks 93rd among the lowest of the 104 revenue collection regimes around the world. are we 93rd in collection? >> i have not -- i cannot comment on that statistic. but we have been collecting recommendations from the accounting office as well as recommendations that came forth from the kerry-garns commission that addressed many of these issues. at the end of the day, what we are looking at is to achieve the objective to make sure that we are getting a fair return back. >> did you testify earlier that

this has not been updated since the 1920s? your statement? >> no, dinod not. that is something which we have been reviewing and do believe it should be changed. >> so that has not been updated since the 1920s. we certainly should look at that and bring it into the 21st century. also the gao reported that mms does not audit oil and gas company royalty numbers, is that correct at this point? that was the gao report. >> there are auditting functions that do occur. we do collections from companies where they have under paid and that does happen on an ongoing basis. we are in the process of

implementing numerous recommendations from gao as well as those from our inspector general. >> but is it fair to say that we could be under collecting by mill ions possibly billions in this royalty program? >> i think it is fair to say that there is under collection that is taking place and it really revolves around two key issues one is t measurements relative to the oil and gas that is being produced against which the royalties are being leveed and secondly, the royalty level itself and whether or not that is the appropriate royalty level. >> and that is what my bill would look at to look at more accurate measurements and compare with other countries. also -- in the -- they are call

me to a vote. this is an important area and we need to move into t 21st century. why in the world are we rated solo 93rd in the world in the royalty payments coming from the gulf? and did you tef eastify earliert you had written bp for royalty paymentsf $5 billion, is that what you said? >> no, there was an underpayment by bp with respect to on-shore activities in the best. the royalty program now in effect -- >> how much was their under payment? >> your time has expired. >>an he answer that question? >> as i recall, it has been several weeks ago, for that particular issue it was about $5 million. >> thank you. mr. salazar i announced that

you had to leave at noon and i will abide by that and t even asky own question. i know that you understand as a former member of congress when bells ring, i speak for the chairman when i thank you both for very important testimony here today. the hearing is in recess until after the vote. >> thank you..

live coverage resuming on c-span3. >> acting director in 2009 before joining the inspector general's office miss kendall served as an attorney at the agency for over a decade. we welcome you to the comment. danielle bryant has been the

executive director of the project of government oversight since 1993. miss bryant has lead numerous investigations that have exposed wasteful government spending and helpfulful -- spending and helped bring policy reform to government programs. we kewelcome you to the committ. miss randolph is the president for pronounced -- thank you very much. worked on that all night. and as well as serving as parrish president, miss randolph is the owner of a public relations andtizing compae i ad company and was previously an editor at the "latoosh gazette".

i would ask each member to deliver their five minute testimony. you start out the light is on green, and then it goes es toe yellow which means you have a minute left and then to red. i would like to quinn with you, mr. rusco and come right down the line. and we welcome you to the comment. you may begin. >> thank you. chairman towns, members of the committee, thank you fort the opportunity to speak today. it will reduce the risks of

future oil spills. it is important to recognize that interior faces multiple challenges in effectively manages its federal oil and gas program. over the past five years, gao and others have evaluated many as sects pecks of management on federal lands and waters and have found many deficiencies. we have recommended numerous changes to the program. in fairness, the interior has responded to many recommendations with actions that we hope will result in effectiveness. many challenges remain and we hope that interior will keep its focus on a dressing deficiencies we have found. the findings and recommendations from the recent evaluations are details in my written statement for the record. i want to discuss three key

examples that illustrate a challenge for interior. each will require separate actions to resolve. i hope that my discussion make it clear that all three share an important common thread. each problem illustrates the importance to the interior of keeping up and adapting to change. first, until recently, interior had gone over 25 years without re-evaluating its approach to leasing oil and gas properties. when we evaluated the lease management practices we found that interior did less than other owners to encourage diligent development. did more to in chokwinquire dev

of more speculative leases. second until recently interior had gone over 20 years to reevaluating its approach to collecting revenue. when we eevaluated this, we found that the federal government collected among the lowest levels of lev new from over 100 systems evaluated. we found that because the system was inflexible to changes ip oil and gas prices. that interior was at increased risk to succumbing to ad hoc increases. for example in the mid 1990s, low oil and gas prices lead to royalty relief for deep water leases. with the subsequent increase in oil and gas prices, this relev will cost the federal government billions of dollars over the life of the leases. we found that the program

utilizes data systems that are income pa in compat able. this poses risk to the effective management to the oil and gas program and the collection of revenues. part of the cause of these problems is that the it systems were developed in a piece meal fashion over a period of time with little to no planning. we are encouraged that interior has started to re-evaluate its revenue collection and that it recognizes that it faces significant it challenges. however, the potential for future management problems will remain until and unless the interior adopts an approach that adapts to changes in the oil and gas industry.

the it environment, as well as other significant facets of oil and gas management. there is risk inherent in all activities and completely eliminating the risk is not possible. however, if interior builds risk management into it's internal structure and implies it consistently, it can be better in mitigating risk to the extent possible. this is true regardless of how interior is structured and it will not be fully successful. this concludes my coral statement. i will be happy to answer any questions the comment may have. >> thank you very much for your statement. >> thank you for the opportunity to testify today about the r proposed reorganization. as you well know, we have identified in mms weaknesses and

misconduct. we found more of the same in our report. although the misconduct is less slashs in our report, both highlight a challenge that the successor agencies to mms face. that is the potential conflicts of a regulatory body that is in herntly tied to the industry it regulates. i am concerned about the environment in which these federal employees operate and the ease with which they move between industry and government. i am also concerned about the conduct of industry representatives that they should think it permissible to provide federal government employees with gifts after all the media coverage about this practice is hard to imagine but may be informed by the environment as well. wheel n while not included in our may

2010 report, both government and industry have often known one another since childhood and their relationships were formed well before they joined industry or government. mms has relied upon the ability to hire employees with industry experience. with the announcement that mms will be reorg niszed. the demtment is poised to reconsider some are our recommendations. these must include controls and strong oversight. in the fall of 2008, inspector general testified before the house committee on natural resources which is a correction to my written testimony. describing what was then a struggling office now called our royalty initiatives group. since that time, we have

established a unit dedicated to energy issues and have expanded our oversight coverage beyond mms to the programs at the bureau of land management. these two offices have been dedicated to oversight and improvements. it has become clear that we must expand their scope to provide oversight of the safety inspection and enforcement as sec spects of energy production. we are hopeful that, the newly created review unit will provide an additional element of oversight to the agencies. the oig is reactive in our efforts. we hope that the iru will provide continuous compliance review to identify weaknesses before they become serious

problems. we also rely on the bureaus to conduct internal allegations. the iru will be a dedicated point of contact to which we can refer such matters. presently the office of inspector general is able to address relative areas of concern with respect to off-shore drilling. we are also participating in the investigations being lead by the department of justice into the events that lead to the disaster on the beep water whorizon. we will continue to build our oversight capacity beyond royalties into the areas of safety and oversight of drilling operations both on and off shore. the drilling efforts regarding environmental concerns are also address i addressing a two pronged effect.

a body created by order on april 30th of this year. the secretary requested that the board make recommendations to improve regulation of ocs operations. second, the secretary asked the oig to address deficiencies to policies or practices that need to be addressed to make sure that operations are conducted safety. since these requests were so similar in scope, the effort will respond two-fold. we will provide the safety oversight board our findings, we have found several areas that call for further review and we will continue to pursue these. that concludes my prepared testimony today and i will be happy to answer any question. >> thank you very much. miss bryant?

>> thank you, chairman for inviting me to testify. i also want to thank rab ks member we have been working together for 15 years on this issue. mms was created in 1985 because royalty collectioned had been buried. if there is any silver small silver lining to the gulf disaster, it is that it has call ed attention to long needed reforms. while the reorganization is a good step, we have real concerns about it's implementation and whether those planning it are consuggelting the stakeholders. we also have to discuss example of the two recent directors going to become presidents of

off shore drilling association needs further discussion. the mission of the association was to secure quote a favorable regulatory environment for off shore oil and gas drillers. yet they were the regulators when they had been working in the public sector. you have to ask whose interests were they serving? there have been several major improvements and steps to slow the resolving door passed by the senate energy and house committees. we hope the house is passed into law. the second problem is that mms has allowed industry to operate largely on what the gao described as an honor system. it will help mms gain back some of its upper hand. it is hard for interior to attract and keep the talent it needs when inspectors have

starting at a gs-7. if we only look at that and not on how we are spen sacompensati those, it is a huge program. we have learned of one inspector who after three years on the job has still had no training. the last in spension wspection performed by an inspector still in training. so changing the culture requires more than reorganization and more than new leadership. they will need to dig deep into the management of the agency. no matter what reforms can be put in place, despite the

administration's open government directive, interior for example has only focused on disclosures of things like the nation's national treasures rather than information about oil and gas leases. the kind of information we need to know are the kinds of things policy-makers would learn if we started to talk to people online. for example, even after the deep water horizon explosion, in specker concerned are still being ignored. a deep water production facility was operating days after he issued an order. when he contacted his supervisor for aprofproval to issue anothe order,is supervisor overruled this. we have learned this has become a common practice where

inspectors feel they need to ask permission because they are more likely to get in trouble for issuing an issue of noncompliance. mms inspectors are just beginning to speak out. i can tell you with experience that mms has been a hostile place for whistle blowers. protections are needed and would be offered through the legislation sponsored by representatives. ultimately mms must reorganize its priorities to protect taxpayers. thank you vagain and i look forward to answering your question. >> thank you for your testimony. miss randolph? >> thank you, mr. chairman.

thank you, mr. chairman. on may 8th, oil first appeared on the shores of our parrish an event caused by reckless tragic decisions made by bp personnel who did not follow established safety guidelines. we have now endured 74 days of effort to protect our wetlands and wild life. then came the moratorium on deep water drilling adding insult to injury. research conducted by the center for studies y ies revealed that ban will not only impact a few parrishes in louisiana, 43 in florida, 42 in texas, louisiana 32 in mississippi 7. the department of the interior's own report estimated 120,000 jobs would be lost.

nine of the top ten taxpayers are located at pour foshaw. the spill has decimated the fishing industry, the moratorium will essentially end life as we know it in our parrish. no business can survive this much uncertainty. up to 40% of our tax base could be lost as a result of the ban. they in tend the leave the gulf for other opportunities elsewhere in the world. some have been offered transferred in locations in other states. families are now making decisions whether the mother or father will live elsewhere. the rest will be terminated in our area, that could be 10,000

people. in april 2010, the unemployment rate in our parrish was 4.4% the louest in the nation. by november 30th, the number will increase. in this country a whole lot of money has been borrowed to create jobs to stimulate the economy. we fuel this country. on may 28th, i had the opportunity to personally ask president obama to reconsider his decision based on the devastating economic blow we would suffer. he declined but offered to send down a economic team to assess our parrish. that was may 28th, the team will arrive july 26th. we have announce thad no permits for drilling new wells will go

forward until the 30 day review i requested is complete. that was the first intense scrutiny of the industry. president formed another commission with members asked to restudy this for six months. we will die a slow death. statistics indicate an oil tanker is more likely to spill than an oil well blowing out. up to 3 million barrels traverse the gulf daily. 11,000 tankers traversed the gulf last year. in order to resume activities operators must submit evidence that they have the ability to respond effectively to a potential spill. there are those who call for a

halt to oil and gas. what is being overlooked behind the suspension is that all of these tankers traverse the gulf. based on the information behind the statement released july 13th, i am today challenging the government to protect all gulf states from another spill as completely as possible. stop all, all tanker traffic in the gulf of most co. mr. chairman, i await your questions. >> thank you very much and i really appreciate your testimony. let me begin by with you miss bryant. you said something that i want to make certain i understand it. you said, big deep into the management. what do you mean by that? >> i'm concerned that we are dealing with sort of the top layer. what we have learned over the

years looking at mms is that a bulk of the problem is still there just because you change the people at the top. we have known for years about the auditers who have been strifled by supervisors. the mid management is still in line and nothing has changed from that perspective. >> so changing the name didn't get us there? >> it is not enough. >> okay. miss randolph, before i move any further, i want to know in terms of how big is a parrish. how many people, 95,000 people, sir. >> is that an elect eed positio sfl. >> mine, yes, sir. >> that sounds like mine. you have to run for it. yes, mr. rusko and i guess miss

bryant i want to ask and you too miss kendall. do you think that the proposed reorganization plan can successfully reform mms? >> the current proposed plan? >> yes. >> um, well -- >> to reform it. and get us where we need to go. i heard miss bryant on it. >> yeah, our position on that is that there have been in the last five years over 100 recommendations to address specific deficiencies that have been identified. and we've looked deeply at the process and found deficiencies everywhere we look. so, all of those must be addressed for -- for interior to effectively manage oil and gas program. but that is true no matter what the organization is. change it will not implement

those needed reforms. and so, they are going to have to do both if they want to reorganize they have to also implement all of the reforms. >> i share the sentiment of both that reorganization in and of itself is not an answer to resolving profound management on challenges. it is -- it will be in the implementation and the other reforms that the department makes relative to the management of oil and gas leasing, oversight and royalty collection. >> if i could add a little more meat to my overall comment on that, while we certainly agree that splitting up that conflict in mission is an essential change, it also could create

more problems. we now have three smaller agencies, as we are all sort of students of government, it is how big and powerful you are. we are worried from the audit perspective. we have been thinking for some time looking at those small audit shops across the government and thinking about housing them in one place and have them actually be is more v added -- value placed on their role as auditors, for example. the other thing that worries us is that some of the people who really need to get the tables we're talking about, this reorganization, aren't there. the states and tribes that mms is responsible for collecting royalties from are not adequately being consulted and participating in the process and that's a great concern to us as well. >> this department of interior, does the department of interior have the expertise to be able to do the kind of monitors and

oversight that we really are expecting? >> well, they -- >> because i'm looking at gs-7, that's, what, $38,000 a year? >> isn't that awful, yeah, to think of the responsibility that we're placing on them and we're so undervaluing them by how much we're paying them. the other part what we think is important that hasn't been on the table at all is bhm at interior also is conducting these inspections and we're not talking about them so shouldn't there be some conversation about at least merginging those missions in one entity as well, so i think there's a lot of important things that should be part of the conversation that haven't been yet. >> right. do you think they have the expertise. >> no, we found many cases in which the level of expertise, the level of training and just the sheer number of people to do the job are inadequate especially for an inspection

area, and in the area of patrolling engineers to evaluate drilling plans and to evaluate processes. >> i guess my five minutes is up. i don't think they started the clock, so. >> mr. chairman i'd ask unanimous consent you have all of the time of the other members here on your side. >> i'd be delighted to take it but i'll yield five minutes to you before we do that. >> thank you, mr. chairman. like the chairman, i think there's no limit to the amount of questions we'd like to ask each of you. i'll start with miss randolph. i asked secretary salazar a moment ago, over an hour ago now, about why an arbitrary six months rather than when the existing well, which is certainly a danger until it's killed, once it's killed, why he couldn't reconsider at that moment changing, and he gave me an answer that over the next six weeks, eight weeks, he was going to have all these studies come back.

you've seen the president make a personal promise to you. you have sat there watching people be laid off in an industry that is not being compensated at all for being laid off. they're not like the fishermen. the oil men themselves are just on their own if they get laid off. they cannot go to mr. feinberg to ask for my money because they're not part of the "affected directly." what do you need to see from this administration in order to have the confidence that they care enough about louisiana to actually put people back to work? >> well, the immediate response would be to lift the moratorium. >> but do you agree with the premise that if secretary salazar were to reconsider a date shorter that, when the well is actually killed, which hopefully will be in a matter of weeks, that that might be the appropriate time to say it no longer is a danger, therefore, resources could be available,

therefore, we could lift the ban, would you be satisfied if he used that instead of six months and then we look at it with no expectation, that that would be a hard reopening? >> we would be very satisfied. that would be a finite date. the industry itself could make decisions based upon that date, and therefore we would not lose all the service company jobs that are associated with it, yes, but my concern this morning is, mr. balmer talked about another study that begins or additional hearings that begin on august 4th and end september 15th with a report due on october 31st, so it's another study that doesn't provide us any direction. >> well, unfortunately, that will be two days before, three days before the midterm elections, i suspect no one's going to look at them until after that date, too. miss brian, you and i have worked together on transparency and will continue to. >> yes, we will.

>> miss randolph in particular has experience about ghost assets, all of the parishes do, where there are claims in writing that "x" amount of skimmer, "x" amount of various assets are brought to bear and we find out they weren't there and to be honest do not know if each number of skimmers claimed is greater than the total number of skimmers contracted. have you been able to get any better information on what the real assets that brought to bear were, and if not, why do you think you're not seeing it in. >> we have not had any better access to information. we do think that there's a tremendous problem with the lack of transparency in this entire cleanup operation. part of the problem there's an acceptance bp was in charge for a long time and sort of leaving it to the private sector which we believe this is something where the government should be in charge in making all information public to the general public, and that just hasn't been the case. >> you know, one of the interesting things that i discovered with the chairman when we went down there is that

they run consensus management, which is a nice way of saying one group's in charge, except really they're not in charge. it takes everyone to have a decision. therefore nobody's really accountable. therefore, the decision to release is probably beyond the expertise of everybody. it's no way to run a railroad. i guess i'm going to sort of pose to both of you for a second and i think mr. rusco, because of your past studies, i think you see it but you've both been asked, this reorganization, if you will, moving the deck chairs on the "titanic" doesn't it inherently delay the ability of the organization, whether busy reorganizing, from getting to the various failures that both of you have seen in past inspections and studies? >> that is a concern that we have. we know that organizational changes is very difficult. it's disruptive and it takes a

lot of agency resources, and at the same time they're dealing with this catastrophic oil spill. they're also dealing with trying to do the work that they feel they need to before they can lift the moratorium and then they have this backlog of recommendations that they're trying to address to improve their systems. it is a concern. >> miss kendall, same for you assume that, it's very hard for your various igs and so on to, the people that work for you to actually figure out who you're supposed to look at and what you're supposed to oversee if the chairs are moving around. i'm assuming that one of the problems right now is you really don't know which one of these three entities to focus on. is that correct? just during the reorganization. >> during the reorganization? >> yes, ma'am. >> now, what we're really trying to do is focus on issue areas,

but following those issue areas as they're being moved around has not yet become a challenge, because the actual movement hasn't taken place, but i imagine it would be in the future. >> one quick last question, if i could, chairman. you know, the chairman and i enjoy the title of "oversight and reform" and the theory of that is that congress has an absolute right to, if you will, intervene in the organization of government. congress actually authorizes who gets to be a cabinet or not. we created the cabinet position for homeland security and so on. if the gao were tasked in combination with this committee to look at the various revenue entities, not just in the department of interior but primarily the department of interior, the various -- well, maybe include the irs, clearly the outside, the various parts of inspection that go on

throughout the government, but particularly the department of interi interior, and of course contracting, and ask the bigger question of, should this entity really be truly consolidated with other areas of, if you will, cultural excellence by comparison? do you believe that's something you could deliver at least a preliminary report back to us during this congress? in other words, are the basic facts of these other entities, their existence for consideration by this committee something that we could begin working on before the lights go out at the end of december? >> i think it's something we would be willing to talk to your staff about. i'd hate to commit at this point anything without further information. >> mr. chairman, there's more than enough if there's a second round but that would be something i'd like to have our staffs explore is whether we could take an active role in looking at a much larger reorganization, particularly when it comes to the following,

which is i heard the gs-7 and i appreciate that, but i happen to know that the inspectors go up to about $100,000, gs-13s and 14s, so there are some people that are paid relatively well and in fact paid better than their counterparts in the corps of engineers, who oversee, you know, public construction, including nasa. so with that, i yield back mr. chairman. >> right. i'd also like to add maybe we need to look at terms of stability, in terms of how long people actually stay with the agency, i think that's another issue that we need to consider as well. at this time i'd like to recognize the gentleman from ohio, mr. jordan. >> thank you, mr. chairman. all of you were here for the first panel, listened in on the questioning. i was intrigued by mr., and i wanted to ask secretary salazar some questions but just because of votes wasn't able to get back in time before he was dismissed. i was intrigued by congressman turner's timeline prior to the

terrible accident in the gulf, the deepwater horizon. so i want your thoughts. i mean obviously bp is at fault here and we understand that. but do you believe -- well, let me go back to this. in mr. turner's timeline, he referenced four different occasions where standard inspections were not performed. so i want your thoughts. do you believe that this accident could have been prevented if mms would have done those inspections? and we'll just go down the line. >> it's difficult to say, but i think that there's a bit of a misconception about what these inspections are about. most of the inspections that take place on rigs offshore are dealing with safety of equipment, such as railings, stairways, slippery surfaces. they're dealing with

environmentaler e eissues such y noticeable leaks of high row ko hydrocarbons and dealing with production verification issues looking to make sure that the metering is done correctly and that there are no bypasses of meters and that everything is accounted for. >> on those inspections people aren't out on the facility, on the equipment itself? >> they're out there and they also look at records, they look at records to ensure that the approved plans are being followed, and they have, you know -- >> well but certainly, the fact that if those inspections woochb done there would have been a better chance to protect those problems. >> i can't argue thwith that. >> 34is kendall? >> i would echo everything mr. rusco said but i would also add, based on what i know and i am

far from patrolling engineer, but i believe that what is coming sort of to the fore is that things like the well design, and review and approval of that, the actual practices of when to pull the mud and replace it were the kinds of things that, and there are any number of sort of decision points along the way that may have prevented what we're dealing with now, but i don't know that inspectors are the answer to that sort of issue, that there has to be some much more careful review of those kinds of issues. >> not disagreeing. we're talking about restructuring, reorganization, that all is probably necessary but the law said do these inspections, and they were not done, and a bad thing happened,

could have been maybe prevented, if, in fact, those inspections had been done. that seems pretty logical to include maybe they'd have caught something if -- they didn't even do their job. >> i think maybe is certainly reasonable. >> if you cut to the chase they didn't do their job and now we have this terrible incident, lives were lost, economies are affected, miss randolph knows that firsthand, people's lives, families lives and small business owners now the president said now we have this terrible accident we're going to stop drilling everywhere and further make a bad situation even worse. that's where we're at, maybe it could have been prevented if they had done what they were supposed to do. miss brian? >> i don't know enough about the inspections. there's no question mms has not been doing its job for many, many, many years so there's no doubt if mms was held accountable these are issues raised by the congress, by the gao, by the ig, by pogo 15 years so there's no question that if mms had reformed and the many

times it was told it needed to we wouldn't have seen what we had in this accident. >> thank you. miss randolph? >> i think it's a shared responsibility, not only did mms not do its job, bp didn't do its due diligence. >> all right. i give back, thank you, mr. chairman. >> thank you to the gentleman for yielding. i yield to the gentleman from california, congressman bill bray. >> thank you mr. chairman. >> sorry, i yield to congressman welch. now i yield to you. >> thank you. >> mr. rusco i would like to talk about the response to the crisis. does anybody have any information at all, did the army corps use the spillways upstream from new orleans to divert water in pontchartrain to try to get that flow to keep the oil out of the pontchartrain and lake

bourne? >> i'm sorry that's something we have not studied. >> okay. i was a county chairman myself so i kind of relate to the frustration that when you want to do things, those who are always saying, you know, saying no are continuing to say no even though things need to be done. do you have a clip of what happened? staff have a clip of that piece about the berm in grand isle? can we play that? >> we submitted the stats to the corps and asked the corps to help us and in the meantime different agencies that popped up like a cork and these little groups that was anti, and it was 95 pages of questions that our engineers, we worked through the weekends, many hours, took turns behind the computers, making e-mails back and forth, making sure we did everything right to question and answer. so bottom line, i'm

of the world but did you have any kind of situations like that where you basically ran into this issue where everybody said stop, we've got to study something, don't do things and basically we're always telling the locals no or did we get a lot of support saying go ahead and we'll work it out later? >> it was very similar to what david was describing in this video. they are our neighbor, so this is, these berms are very important to us, and now i'm watching a storm that may be coming into the gulf.

our response in those situations is from the bottom-up. we do what we know best. we respond naturally, instinctively, as humans should, with plans in place. this has been a very unique situation and a very frustrating one, yes. >> i really relate it to the fact that the army corps always love to say we need to study the environmental impact of building a sand berm, and not realizing there are times that you've got to call an audible, there's times -- leadership means dropping the rule book and doing what you can and where you can in the best common sense way and this one was really kind of an interesting one of well we got to make sure a berm doesn't hurt the environment while the oil i!

cocoa tree on bioterrabon at the camp there. the family loves that area but to sit there and have basically the system rewards those for inaction, and it's safer for a bureaucrat to say no than to say yes, we accept that most of the time but during a crisis, there should be a way of burning a fire that says look, if you don't call an audible, if you don't do extraordinary things, if you don't throw the play book away and use innovation you're going to get in more trouble than if you do something wrong. we've got to figure out how to do that. miss brian, you got any comments or any concerns? i've been waiting to call on you anyways just for your name. >> i know you love my name. what you're describing is very similar to what we saw happening with the inspectors where the supervisors are making them scared to actually assess

noncompliance orders because they're afraid if they do something they'll get in trouble rather than if they don't do anything. it's a scary mind-set to me. >> mr. chairman i will just tell you i personally witnessed the results of hurricane katrina. i was in louisiana and i was in mississippi, and i saw the difference between the mind-sets. while everybody -- the feeling seemed to be in new orleans of don't do anything, because you may do something or not have something done approved, and when i went over to picayune, on the other side of the river, do what you can do we'll worry about whose jurisdiction it is later. i hope somewhere down the line in the federal responses we can sort of adopt that mississippi mentality that i saw during that disaster, rather than what i saw down south and no offense, madam president, but there was a distinct difference. it was astonishing that two different political jurisdictions could respond so

absolutely different to crisis, and i think there was a lot to learn there, so thank you very much for your testimony. >> i thank the gentleman from california for his statement. just before i call on congressman welch, miss lukemeier ask noon muss consent that i include a statement in the record and i yield to the gentleman, mr. welch. >> mr. chairman, thank you. i am concerned about a lapse in the royalty collection for the period of leases between 1996 and 2000, and i just wanted to ask a few questions about that. miss kendall, the department of interior, you probably have become aware of this, there was a set of leases that were issued between 1996 and 2000. they were under a law that was passed by congress that was intended to try to encourage domestic drilling but it was when oil was under $25 a barrel,

and as i understand it, the law said there would be no royalties until a trigger price of $26 a barrel was hit. oil now is $75 or $80 a barrel. at one point it was $140 a barrel, and according to the report that i've seen from the gao, unless we change this so that we can collect the royalties on what would be due on these leases for the oil that is above the trigger price, the taxpayers could be out about $60 billion. are you familiar with that? >> yes, sir, i am. >> and are there any specific action actions, the question of the loophole was litigated by anticardo petroleum, they argued the way the law was written there was not explicit authority

to charge the regular royalty rate above the trigger price. many members of congress who voted on that legislation had no idea that there was going to be an exemption no matter how high the price went, but the court decision was that the law has to be changed in order for the taxpayers to collect the royalties that was the intention of that act. is that your understanding? >> yes, sir. >> so it would be, is it your understanding that in order for there to be a collection on these royalties, we would have to pass a law to make that permissible. >> congressman, i do -- i'm familiar with the case that you're talking about. >> right. >> i'm familiar with the act generally, i am not familiar specifically to any degree. i don't know if -- and this is just my thinking off the top of my head, whether congress could

successfully go back and pass a law that addressed those years specifically retrospectively. i would just guess that there would be a challenge for that as well. >> well, we'd have to get our legal advice and do it right but i think all i'm asking you to indicate is whether there appears to be any administrative remedy to what appears to be essentially a loophole by which the companies that are drilling on public lands are doing so without paying royalties to the public for that profit-making privilege. >> i'm going to have to rely on fairly limited memory, but i don't believe that there are administrative remedies when there was a fundamental flaw in the law as found by the court. >> all right, then i think mr. chairman, congressman markey and i will be introducing legislation that would be designed to remedy that loophole

and provide to the public the royalties that they are due for drilling on the public lands. miss brian, are you aware of this? >> i'm certainly aware of the problem and i think it would be terrific if legislation were passed to correct it. >> do you? >> i do. >> all right. miss randolph i want to welcome you. i think all of us are heart-broken. i went down to the gulf and as heartbreaking it was forever me to fly out over that magnificent, beautiful marshland at the delta, what was the hardest was coming back and meeting people who were fishermen and the oil industry and seeing how lives are being turned upside down. i want to express to you my heartfelt sadness about what the people of the gulf coast are enduring and will long after congress has moved on to other things. so thank you so much for coming and all you do down there. >> thank you, sir, and as a recipient parish of some of those royalty revenues, i look forward to you increases that.

>> all right, thank you. mr. chairman, i yield back. thank you very much. >> i thank the gentleman for yielding back. let me just sort of, i guess, again, mr. rusco and of course miss brian and miss kendall, how has this cozy relationship between the industry and mms impacted oversight and safety standards? do you think it has interfered with it at all? >> i'd like to just second what miss brian said that there's sort of two problems. there's one that you could describe as a resolvivolving do issue that may be a bigger problem at higher levels of management than it is at the level of inspectors and engineers, but there's a second problem, and that's that they

don't pay, by and large don't pay a competitive wage with industry, so when the industry's in good shape, they can pay a lot more than what interior is paying the people with comparable skills, and then when times are bad, interior can hire people. so there's sort of a structural problem that could be dealt with by addressing the amount that they can pay people, and there are other compensations as well, but i think that that's part of the problem. so it does, though, the lack of the proper number and amount of expertise that they can bring to bear does affect their ability to do their job. >> miss kendall? >> i would also say that some of the exceptions in the ethics

regulations have allowed folks to kind of get away from the intent of the regs, for instance, the acceptance of gifts because of a personal friendship. these people are all friends. the folks in industry and in mms that grew up together, they married each other's sisters or cousins, they've been, you know, playing on the same teams since they were in high school, and so the exception to the gift rule, which says if it's based on a personal friendship could be exploited. on the other hand, if someone were to say i'm accepting this on the basis of a friendship, they should also be prohibited or recused from inspecting the rigs or the facilities of the people who they have this

friendship with. i think that there may be, and i go back to the ethics regs, too. these are the floor, not the ceiling of conduct, and i think mms has an opportunity to make stricter rules apply to a very unique and a very specific problem that they have. >> they could do it administratively. they don't need us? >> they could do it administratively. >> miss brian? >> mr. chairman, i have the benefit of having looked across the federal government for many years, and, and i continue to think mms is probably the worst in the government when it comes to its coziness between the regulator and the regulated, and as i mentioned, when you, the congresspeople were voting, mr. issa certainly has known that. he's been working on this for years and mrs. maloney i've been working with her for 15 years on the issue. there's no question that the coziness in this particular

agency has been extraordinary across the federal government. there's no comparison in our experience. >> right. even in the congress, when you leave, you have to stay out a certain amount of time before you can come back and lobby the congress. that's the congress. so i'm wondering if maybe something along those lines shouldn't be instituted here. >> there's absolutely no question we need to change the rules when it comes to the revolving door and there is strong legislation that's been worked through the house natural resources committee that would be addressing this particular issue and i certainly hope the committee members support that legislation. >> i notice you didn't start the clock so that's good, but i now yield to -- >> mr. gao. >> mr. gao, the gentleman from indiana, i mean gentleman from louisiana who is really familiar with this subject. >> thank you very much. mr. chairman. my question my question

was i want to focus on the issue of shallow water permitting. i was reading one of the articles from "louisiana today" and they were saying about the slow process of shallow water permitting, and this is a question to president randolph of lafourche. how has this permitting process affected the shallow drilling industry in your parish? >> the department of the interior and mms's ability or charge to issue permits can create a de facto moratorium,

and mms has done so, because the response to the request for permits has been very, very, very slow in the shallow waters, and the deep waters, what has been addressed in media, but shallow waters there's a de facto moratorium there as well. >> and how has this de facto moratorium affected some of the industry in your paris, how has it affected the people who are employed by the industry, some of the businesses that are directly or indirectly related to this industry? >> the shallow water de facto

moratorium essentially has put independent contractors out of business, the fact that they cannot get permitted or repermitted under the new guidelines affects a lot more of the small business owners in the community. we talk about the four or five major companies in this country, the oil companies, but when we talk about the shallow water that's where the independents are and the majority of the exploring companies are independents. they don't have the resources, and -- or the resources to sustain any type of long-term moratorium. they cannot survive that long, and therefore, they've begun to lay off people, yes. >> do you know of any rigs or any low drilling companies that have moved rigs or shut down because of this slow permitting process? >> in the shallow waters? >> yes. >> yes, sir.

>> do you know the names of them? >> no, i don't have the names for you, but i can -- >> but based on your knowledge, there have been rigs that have moved out of louisiana or companies that have shut down because of this moratorium or at least de facto moratorium? >> yes, sir. >> mrs. kendall, how has the -- are there ways under the new rules and regulations implemented by mms that would allow greater speed of permitting to some of these shallow water rigs? >> i'm sorry, i couldn't hear much of your question. >> are there ways or procedures to expedite the, some of the permitting process through the mms within the new rules and

regulations that were implemented after deepwater horizon? >> i simply don't know the answer to that question. i'm not familiar with the newly implemented regulations. i can just speak to sort of in general terms. i know that in having discussions with people, the, i think part of the contributing factors, mms now has become a little gunshy and is being extraordinarily cautious in their review and their processing, not that that excuses them, and i know that it puts a toll on the folks who are reliant on those permits but i just don't know if there's anything, new regs that would speed that up. >> thank you, and i yield back. >> the gentleman's time has expired. i now yield to the gentlewoman from new york who has done a lot of work in this area, congresswoman carolyn maloney.

>> i want to thank the chairman for focusing on this important area of government, and an area that clearly needs reform and i believe an area that would not have had this focus if we hadn't had the catastrophe in the gulf with bp and it's long overdue. i wanted to mention that earlier today in our hearing with commissioner salazar, we were talking about a recent gao report that was really developed for this committee on the revenue share the government collects from the oil and gas produced in the gulf and this report ranked our country 93rd, one of the lowest of the 104 revenue collection regimes around the world. i find this absolutely scandalous. he also testified that the

revenue royalty collection system had not been changed since 1920? i would like to ask miss brian to respond to this. we worked to end the royalty--in-kind program and trying to have one set of books, not two or three and to really get a fair deal for the taxpayer and could you comment on this and why do you think we rank with our technology, our expertise, why do we rank 93 snrd we should be first, police brian. >> i absolutely share your outrage, mrs. maloney, it's ridiculous and there's absolutely no, certainly no excuse for it. i think this has, for reasons i've never been able to understand, you know, as we've said, we've been working on this so many years. this is not news to us. this is an agency left to fester by itself without breaking it open and fixing it and i'm hoping that as i mentioned before, there's a small silver lining in the catastrophe is

that the long needing reforms will finally happen. >> and how will this change take place and how long will it take before the royalties increase and we have more of an accurate reflection of the value that is extracted from publicly-owned lands? >> well, at the moment there's nothing pending that will actually change the collection of royalties at all, none of the reforms that we are hearing about today will actually fix that. that is something that is still up to the congress to tackle. >> well, also in the gao report that we've had, it found that the mms area should do more to improve the accuracy of data used to collect and verify oil royalties thank, that there really hasn't been change or update and i have put in a bill hr-1462 and this bill would require a national academy of engineer study regarding improving the accuracy of

collection of royalties on production of oil, and literally the first panel testified that they need better indicators, and i feel personally that this would be an important step forward. i would like to make sure that all of the panelists have a copy of the bill and if you would get back in writing whether or not you support it, it might be a way to move this legislation forward so that we actually can increase the royalties from these publicly-owned lands. what will the agency to to improve the accuracy of the data? is there anything put in place for the accuracy of the data now? >> the reorganization itself says nothing about that. there are many, many things that need to happen in order to improve the accuracy of the data, including rationalizing databases across the many units of the oil and gas management

program, so that they are actually compatible fixing the functionality of these databases so that they're collecting the data they need to do audits and oversight, and all of this needs to be done with some sort of central vision of bringing the i.t. system up to date, because it's horribly behind what the industry uses. >> well why in the world aren't we updating it, and i would invite all panelists to submit in writing ways that we can update it. another important gao report said that there are no audits of the oil and gas company royalty numbers, that the audits are done by the companies themselves, and in so many cases, mms is probably undercollecting by hundreds of millions of dollars. can you comment on the lack of audits of the oil and gas company royalty program?

>> we found that there were problems with the self-reporting of data and the fact that there weren't automatic and very quick checks of that or the use of third party data as one would expect in a system like this. for example, the irs, you voluntarily provide your tax return, but your employer sends in the information and your bank sends in information, and the irs looks at that and compares them, and in the case of royalties, often there is an absence of third party verification. now, what the industry does is they use metering technology that reports every one second on volumes, and they look at each other's data, when there's a dispute between a pipeline company say and an oil producer,

they look at each other's data, and they resolve it based on data. however, interior has not adopted the kinds of technology it would need to collect those sorts of data, and they could. they could collect it directly from lessees. >> mr. chairman, we need to look at that. we need to move into the 21st century and we need to protect the taxpayers in this area. i find it scandalous that we haven't moved to modernize to have audits, to have third party verification, and that we haven't updated this law since 1920. >> i agree with the gentlewoman from new york, and of course her time has expired. i yield one minute to the ranking member. >> thank you, mr. chairman, very quickly in closing, and for miss maloney, we did publish last october something on this with the gao's help on the absence of

audit. but miss kendall you were mentioning the too cozy and the various rules related to these friends, but in the case of colorado, where, you know, look, these people didn't know each other before it got there but they got to know each other so well one of the women ended up pregnant. they very clearly exchanged gifts at a very high level with people that were not their friends, completely in violation, and then felt that they needed even more leniency, to a great extent, isn't this really simply an organization who justifies that somehow because they do the revolving door, they're all friends and therefore they have a special relationship? isn't that a culture that has to be changed, period? >> oh, absolutely. >> okay, i think we've made our point on that. i will mention that mr. waxman, when he was chairman, held an interesting hearing and that was the analysis of the difference between fuel at temperature and wanting to hold our retailers

accountable for the differences in the temperature of the fuel being delivered to the retail pump, because on a 90-degree day versus a 60-degree day the amount of fuel you get, the btus available expand or contract, and the amazing thing was that the technology does exist to do this sort of comparison to ensure that the density that you buy equals the density that you agreed to pay for of btus, so i would suggest strongly that if we get an organization that cares about the american people getting the revenue they deserve, getting the safety they deserve, we will get there and i'd like to close by miss brian, i appreciate your wanting to have the transparency and mrs. randolph but for the gao and ig, i want to thank you for personally time and time and time again doing studies, doing the reports, pointing out these failures and staying with it, even when administration after administration, at least three that i've been around for,

failed to do what you asked them to do, and i'm glad to see that we're all united getting it done today but i want to thank you for sticking with it. probably if there's anyone whose pay should be increased perhaps it should be the people who did their job during this period of time rather than those who didn't. thank you, mr. chairman. i yield back. >> thank you very much. let me thank all the witnesses for their time. it's not every hearing where the witnesses and the members on both sides of the aisle agree on the issues, but i think this is one of those rare days in the united states house of representatives, of course with federal oversight of offshore drilling has, for decades, been inadequate and ineffective, the agency formerly known as mms suffered from an institutional conflict of interest and repeated regulatory and ethical failures, as my colleague from

california just described some of the things that went on. all that has got to change. the recipe for reform is not complicated at all. offshore oil drilling can no longer be regulated on the honor system. that's number one. there must be rigorous federal oversight and effective enforcement. conflict of interest must be eliminated. the royalty collections must be separated for regulation and enforcement. sham environmental reviews cannot be tolerated any longer. i don't want to seem environmentally -- environmental assessments that talk about protecting, but the point is we have to make certain that from this point on, that we do that. oil spill response plans must be realistic, and we must

understand that. the entire world now knows that we were not prepared for the bp oil spill. there must be an effective and proven technology available to prevent blowouts in deep water before we allow deepwater drilling to resume. i want to thank you again for your testimony. you have been extremely helpful, and let me just say to the department of interior, we want to help them in terms of their reorganizing the department, and i think that sessions like this, where we can extract information from people that, who worked on these issues for so long, i think it would be very, very helpful to the department, so thanks again for your input. i want to thank the members who attended, of course, today, and again, on that note, the hearing is now adjourned.

here at c-span, we recently made the switch to high definition tv. on "washington journal," we talked to the person -- >> we want to talk about c-span's growth and development. now c-span is in h.d., and we

are welcoming our very first high definition affiliate in frankfurt, kentucky. we want to introduce you to the gentleman who runs that, there. mr. higen bottom. nice to see you again. >> nice to see you, too. host: we figure kentucky is full of political people like us. why did you launch c-span there guest: that's m exactly why we launched it here. a lot of things that happen engine washington come from here. >> i don't know that every single subscriber is a political junkie, but a lot of them are. host: and also knew the miss my-run system. how does that work? guest: we're an electric, cable

system. the cable system started in 1952 making it one of the oldest municipal prayings in the united states. we offer time warner, cox, like the rest of them. a lot of high definition over the next couple of months. host: is the legislature of kentucky on television? guest: yes. our state-run pbs does house and senate feeds. and we've had a long relationship with them. they only meet a couple times a year so most of our viewers see c-span 3 most of the time. host: well, you've been a great affiliate for us carrying c-span one, two, and three and now thank you for welcoming c-span h.d. host: just tell your cable

system that you're interested, and they'll consider it. the digital bus, which is brand-new for us, tell us what you did at the state capital today guest: we had some people come by. we appreciate the bus coming to frankfurt again. host: well, we thank you and love our state capital affiliates and thankful you are the first h.d. affiliate and hope to have more sign on around the nation soon. runing the cable system for 17,000 cable subscribeers and now c-span h.d. will be an option. thank you, john. guest: thanks. have a good day. host: you too. >> on c-span today, the c.e.o. of massey energy talks about his company's coal mining operations in virginia.

democrats put forward their ideas for an energy bill, then it's "washington journal." >> at 11:15 a.m., steny hoyer talks about the economy at the center for american congress. and at 12:30, a look at the effect of the economic stimulus package. you can watch both events live here on c-span and at c-span.org. >> as the senate prepares to debate the energy bill, find out about previous bills with c-span video library. look up a bill and watch congressional hearings and watch previous debate on the house and senate familiar. -- floor. >> c-span library. it's washington, your way. >> the c.e.o. of pasky energy,

faced reportersers at the national press club in washington. mr. blankenship's -- this is about an hour. >> good afternoon, and welcome to the national press club. we are committed to our profession's future through programming and through fostering a free press worldwide. for more information, please visit. to donate to our scholarship programs, visit www.press club worldwide. >> we'd like to welcome our

guest and our c-span and public radio audiences. after the speech concludes, i will ask as many you had a yerns questions as time per mitts. >> from your right, roger conway, chief economist for growth energy. benjamin sarlin, russell mckiver, editor of corporate crime reporter. , dana, columnist for "the washington post." and energy correspondent for green wire. and vice president for environmental affairs at massey -- and chairman of our club speaker committee. marilyn g. wax. a speaker's committee who helped organize today's event.

jim, associate editor for kiplinger washington editors. and labor reporter for bloomberg news, holly. [applause] bloomberg news. [applause] >> don blankenship heads country's most talked-about co's because of his extensive involvement in local and state politics. but in recent months, he has been at the center of news stories and congressional investigations related to a saster at his company's other big french mine in moscow, was virginia -- montcl, west virginia. before the mine explosion, he was the subject of a book, "cold river."

as a child in deaf west virginia, he had no indoor plumbing. as a young man, you work in a coal mine to put himself through college. he became an accountant and which is way up to head the country's fourth largest coal company. with current legislation making its way through congress and investigations continuing, mr. blankenship continue to be a figure in the news this year. he is here to discuss his views on the need for more surface mining. please welcome don blankensh.

>> i want to thank everyone for being here. i want to give some protection -- perspective on three things. >> i want to talk a little bit about thousand world works and then i'll speak al little bit about surface mining and hopefully leave most of our time for questions and answers. . it is true that my at bringing was in southern west virginia. i managed to get through college in three years by working in the coal mines. was i got my accounting degree, i was forced to leave the area for 10 years because of lack of employment the opportunities. i return in 1982 only to find out that massey had decided to withdraw from the co operators association, a national group of coal companies.

withdraw from the organization did not sit too well with the unions. we ended up on a very ballast track. at that time, richard trumka was president of the united mine workers. cecil roberts is now the president. 91 people were parked in the hospital. one was shot. -- three people were shot. one person was killed by had bodyguards for about three months. before that, i had been involved with stories of the union as a kid. i have a background of working with them. my brother-in-law is a lifetime umw a member. i have been a member. my brother was a call minor. my it boggles local miners.

-- my brother was a coal miner. miners -- myr coal uncles are coal miners. when i returned into -- when i returned in 1986, the unemployment was about 26%. that gives you a little bit about my background. before i go on, i do not normally give at the lks. i usually give factual talks. if you have problems, you have to first recognize them and then deal with them. we live in a country that has $13 trillion of debt. it gets worse every day. the number is far worse than people generally and a stand because the municipalities, the

cities, the states, all the pension fanfunds are bankrupt. the country is physically falling far behind our asian compitors. americans are losing their jobs to not americans at an alarming rate. just to show you that i will try to be fair in my criticisms and my thoughts, when you look at three things, you look at the 18th century or 19th century slghs and do look at the trade policy. businesses have always looked to have low-cost labor. that is one of the things that we'll have to be aware of. sometimes the things that they thirst for is a competive advantage to making money. but the fact is, if you do not know numbers, and then you

cannot talk meaningfully about anything. members have to be the undation for our thoughts. -- numbers have to be the foundation for our thoughts. people will say that the banks are too big to fail. they are not too big to fail. no matter how big you are, you will fail. this entire government in this country can fail if it continues to bleed cash at that rate. the other thing that we have to understand is that, however you get there, you have to have affordable energy or electricity to move mankind forward. we can be for or against a different types of energy or certain types of environmental regulations or a lot of things. but fundamentally, it you do not have affordablelectricity in your country or in your household, you will not have a very environmentally friendly life. you will be hot.

you will be called. you will be underfed. -- you will be cold. you will be underfed. almost 80% of the world lives on less than $10 a day. for those of us who are privileged and live in nice homes or arrive on private forget those people because they're n in front of us every day. we know that other people in the world, their health has be in the foremost of their objectives. many of people die of preventable disease every day. the fact of the matter is that cold prevented that from being ale case in america -- co prevented that from being the case in america.

coal is now feeling the chinese industrial revolution. physics and science and math and not determined by the majority or by political views or by surveys. the physics and math of mining, the physics and math of the economy, the physics and math of the unemployed and so forth is what is regardless of what spin is put on it. it is unfortunate that, over the last 35 years or 40 years, green jobs have trumped american jobs. we have not had a surplus trade in this country in 35ears. we're not likely to have one for another 35 years. when our trade deficit is a billion dollars a day, if you have to figure that there is a neighborhood of 2000 jobs a day you do not have, 7.3 million or so jobs is not too far on how

many jobs we have lost. we have lost more jobs in the manufacture of computers and electronic equipment than we have in any other business, except textiles. you would not think that. guess that?et other facts that you have to consider when you take the depositions -- morgan massey said to me when i first became president that one of the things i would learn is that everyone has an opinion without the discomfort of many thought. [laughter] i would tell you that there's a lot of that in this world. but 53% of the mercury emissions in the world come from asia, not the united states. only 1% of the mercury emissions in the world come from the united states. 18% come from africa, even though it lives in abject

poverty. if you believe that mercury emissions should be reduced, would you spend billions of dollars chasing 1% or tens of millions chasing 53%? over 100% of the increase in co2 emissions in the world since 1990 have been outside of the united states. the u.s. industry since 1990 has actually complied with the ku treaty, but not in a manner tha would be -- the kyoto treaty, but not in a manner that would be optimal. facts should matter on the hill. it should also matter that every 3.6 seconds, a person in the world dies of starvation. when we hold ourselves up as being saviors of mankind by trying to reduce co2, we need to worry about the 3.6 seconds that

a person cannot be said because they have died. in west virginia, the epa is constantly after things like conductivity when 40% of the sewage goes directly in the stream. there are no sanitation systems in many of the small rural towns. about 1.5 million people die each year from just indoor pollution in their own home. in many cases, they are burning menorah to fry their food. manure to fore newe their food. with prosperity com life expectancy. in the united states, healthcare, coal, electricity, and they have increased the life span by about 31 years.

it is fundamentally important living 31 years longer. china and india are experiencing the same type of increase in life expectancy despite various emissis. they have heating and cooling and food and economy. that is very important. one thing we need to be asking american business -- we need to understand, when we cannot figure out by wall street and the stock exchanges not attracting, why that is? you have to wonder how much of the profit that is on the new york stock exchange is made in

america versus outside america. what is the payroll inside america versus outside america? what is the wage benefit versus cost per hour? how man american jobs have been created by these corporations in the last several years vs. non american jobs? those types of questions, how much u.s. tax dollars are paid vs. foreign tax dollars, how much subsidy these companies receive to produce jobs overseas -- i have not read the bill, but i ended stand that the energy bill- but i've understand that the energy bill provides tax credits for creating renewable energy sources in parts of asia. i know that subsidies are paid for in pakistan to develop coal mis. there are things out there that you have to wonder whether the american worker is getting a fair deal or not. as far as surface mining,

central the pollution has been surface mining for about 80 years. in the last 40 years, the industry has probably moved 60 billion yards of rock. despite all that activity and mining and a lot of it being done before the 19707 surface mining act, the environmental extremists still consider that area to be pristine environment that meets their protection. so we have moved billions and billions of yards of rock. there is not a lot left to mine the coal. it is amazing how track -- have protected it needs to be today. it used to be that it was real. it meant putting dirt back in a way that allowed it to be revegetated. it is about sitting trees and so forth. now it is about thingsike conductivity. if you're in a room, you need to be careful. it may not meet the epa

standards for water. we have a situation where there is no longer any low hanging fruit in many of the u.s. industry efforts, whether it is mercury, water quality, or whatever. we dischargeater back into the streams that is cleaner than the stress we took it out of only to get violations. there is enough surface mine coal produd in the abolition to provide enough eney to fuel 80 million people's house calls. those 80 million people need their $60 power bills. they do not need their windmill $4 power bills. they deny needed their taxes to subsidize a windmill to be less. whenever the -- however the energy is produced,here will be others that stand in the way of it. you already see resistance to solar panels and windmills.

i was debating robert kennedy a few months ago. he was making a big deal about how his solar panel investment should displace coal only to find out that a total is endangered by a solar panels. in summary, i am from central appalachia. i was born in west -- yet. -- west virginia. always look forward to going home. we're proud of what we do. i have been going into coal mines in five different decades. we do like everything perfectly right, but we do feel very much that coal and electricity and this country's economy and national security and request -- and our qwest to wean ourselves from other countries and the extremism that we are subjecte to on a routine basis,

that should stirrups some questions. thank you very much. [laughter] [applause] >> we already have numerous questions. i am sure there will be more. thfirst question, appellation is very tough to mind, given that we have been doing this for almost two centuries. the matter how sick companies operate, has the risk -- no matter how safe companies operate, has the risk increases? >> you can mine coal by a deep- mining method, but there are some energy reserves that cannot be mined in that manner. if you want low-cost energy, you need low-cost coal production.

>> excuse me, if we could continue with their program, please. thank you. >> thank you. >> as you can see, there are people that have their opinions without the discomfort of thought. they sometimes tie themselves to our trees and tie themselves to our equipment. it is destructive. having civil disobedience is fine, but we do need to be respectful. as to the question on safety and so forth in the coal mines, the fact that we had the tragedy that resulted in 29 deaths, which is the largest tragedy in which is the largest tragedy in the last 40