Afternoon on the pluto flyby this week. Officials were released more pictures and discuss the new horizons space craft. That reading is at 1 00 eastern. This weekend, politics books, and American History. Wrote to the white house coverage features nearly all the president ial candidates and begins tonight in iowa. At 8 00 eastern, were live from cedar rapids iowa for the Democratic Party hall of fame dinner. All day saturday starting at 11 00 eastern, were live in ames iowa for the family leadership summit. A little after 8 00 p. M. Eastern. First, senator Lindsey Graham and then Ohio Governor john kasich it on book tv, were live from new york city for the 17th annual harlem book fair with author talks and panels on economics, africanamerican identity, and race and politics. Sunday night at 10 00, and coulter says the greatest issue stating the u. S. Is immigration. On American History tv on cspan3, were live at the warren g. Harding symposium for modern first ladies. Speakers include historian and dunlap any National First lady library director. A little after 9 00, j of the National Archives of kansas city showed how the government used propaganda and world war ii to persuade citizens to buy war bonds and keep national secrets. Get our complete schedule at cspan. Org. The Government Accountability office says that healthcare. Gov the website where americans can Purchase Health insurance signed up 11 fake accounts. The Senate Finance Committee Held a hearing about that yesterday. This is about an hour. The committee will come to order. Good morning, everybody. Todays hearing will address controls of health care. Gov. We will hear from the Government Accountability office. Sato bagdoyan if im saying that right led to undercover secret shopper investigation to test the internet controls of healthcare. Gov interview the centers this best centers of medicare and medicaid handling of the program. This investigation was designed and determined to the federal Health Insurance exchange can protect against fraudulent applications. What happens when advocates provide false information and documentation and whether the controls are successful in dealing with irregularities. Perhaps i should say spoiler alert before this next part. Today, the director will explain how the federal exchange failed spectacularly virtually on all relevant accounts tested by g. A. O. Created fictitious. For this investigation, g. A. O. Created fictitious identities to apply for federal subsidies. We learned last year, 1112 fake applications were approved. The cms accepted fabricated documentation with these applications without attempting to verify its authenticity and handing out thousands of dollars in tax subsidies. A year later, g. A. O. Has reported that nothing has changed and that, if anything, there are more problems. Worst of all, the administration has known about these problems for over a year now and hasnt taken the necessary steps. While c. M. S. Says it is balancing consumer access to the system with Program Integrity concerns, i think its pretty clear whats going on here. Since the federal exchange was first implemented, success has been measured by a number of applicants that have signed up for insurance. Sen. Hatch indeed, last year when the administration reached its initial enrollment goal, critics were told we had been wrong all along and that the law was despite all the evidence to the contrary, working just fine. However, with these findings from g. A. O. , it seems obvious, at least to me, that the administration has been preoccupied signing up as many applicants as possible, ignoring potential fraud and integrity issues along the way. Now supporters of obamacare says its the law of the lands and congress should work to improve rather than repeal it. On the first point, these proponents are unfortunately correct. For the foreseeable future, the Affordable Care act is the law of the land. On the second point, republicans in congress continue to work toward the repeal of misguided law and mandates, regulations, penalties and taxes and replace it with patientcentered reforms that puts patients in charge of their health care decisions. However, needless to say, that day will not come until a president comes who shares our goal. Obamacare will remain in place. Congress has to maintain rigorous oversight in invitation of the law implementation of the law and protect beneficiaries and taxpayers from its negative consequences. Thats what todays hearing is about. We are here today to get an account on how things are working on the federal Insurance Exchange and what we have thus far is not reassuring and doesnt speak well of c. M. S. s management, the protection of taxpayer dollars, or the experience of and release. Enrollees. The g. A. O. s investigation exposes not only huge gaps, but also flaws in how the exchange and cms contractors treat americans who are trying to correctly file legitimate applications. The g. A. O. Team sent questions only to have it ignored or have the exchange respond. The fact that g. A. O. Encountered mindboggling levels of incompetence and inefficiency at every turn does not bode well for the experience of your average honest enrollee. I look forward to todays hearing and what i hope will be a good discussion of Program Integrity. Before i conclude, i want to note even though this investigation was requested by this committee, c. M. S. Was less than cooperative. Indeed throughout the entire endeavor, officials appear to be dragging their feet, blowing past deadlines and good faith attempts to to put forward this work. No federal agency could stand in the way of that work. By delaying the g. A. O. And hampering their efforts, c. M. S. Has delayed this committees work and hampered our efforts. This is unacceptable and despite promises of increased transparency and cooperation from agencies throughout this administration, this type of stonewalling of legitimate oversight efforts is far, far too common. Acting c. M. S. Administrator who is now the president s nominee to run the agency was personally involved in this process. As the Committee Considers his nomination, i look forward to seeing asking about this investigation and why c. M. S. Has been interfering with our oversight efforts. That will all have to wait for another day and another time. Today, we have our hands full as we hear testimony. So with that, i will turn it over to senator wyden. Sen. Wyden thank you very much mr. Chairman. On this side of the aisle, we do not take a back seat to anybody in fighting fraud and protecting taxpayer dollars. One dollar ripped off is one dollar too many, but lets be very clear this morning. The report up for discussion today is not about any real world fraud. The study looks at a dozen fictitious cases and not one of them was a real person who filed taxes or got medical services. No fastbuck fraudster got a government check sent to their bank account. Moreover, the government auditors acknowledge today, and i want to quote here, their work cannot be generalized to the full population of applicants or any enrollees. None of the fictitious characters in this study step foot in a hospital or a doctors office. The fact is when you actually show up for medical services its a lot harder to fake your way into receiving taxpayer subsidized care before services are delivered, providers ask for a photo i. D. And if you have stolen identity there is , probably a medical history belonging to someone else that ought to set off alarm bells. If you are a real person signing up in the insurance marketplace, you have to attest under penalty of perjury that the information you provide is correct. And if you falsify the application, you face the prospect of a fine of 250,000. Another major antifraud check went untested in this study. That is squaring up tax returns with the information from your insurance application. The General Accounting Office testimony today and i quote calls it a key element of backend controls. If your tax return and personal information dont match, the game it is up, but the study before us today ignores that antifraud check. It only looks at a part of the picture when it comes to stopping fraud. As i noted at the beginning, there are always methods of strengthening any program and rooting out the fraudsters and ripoff artists. Part of any smart ferocious strategy against fraud is drawing a distinction by going after the ripoff artists and on the other, not harming a lawabiding american who has made an honest and often technical mistake. A retiree nearing medicare age shouldnt get kicked to the curb because he or she submitted a n incorrect document. A transgender american should not Lose Health Care after a name change because forms dont match. I cant imagine that anyone in the congress or on this committee wants a system that mixes nixes the Health Insurance coverage of americans because of those kinds of issues. I wrap up by saying a recent gallup report stated that the rate of americans without Health Insurance is now the lowest that they have ever measured. This is the First Finance Committee Hearing on health care since the supreme courts landmark decision that upheld the law that made that possible. The fact is the Affordable Care act has extended Health Care Coverage to more than 16 million real people who use their Insurance Coverage to see real doctors. Now at some point down the road, the g. A. O. Is expected to complete their report. At that time, lets work on a bipartisan basis how this committee can work together. Thank you, mr. Chairman. Sen. Hatch thank you, senator. The witness today is sato bagdoyan. He is assistant director for Homeland Security and justice. In his career, he has served on the office of congressional relations and the assistance on congressional details with the Senate Finance committee and the committee on Homeland Security. In his private sector career, he has held a number of senior positions in consultancies and most recently focusing on Political Risk and Homeland Security. He earned a b. A. Agree in International Relations in economics from Claremont College and an m. B. A. In strategy. We welcome you to the committee and we are interested in your statement here today. Mr. Bagdoyan thank you, mr. Chairman. Chairman hatch, Ranking Member wyden, and members of the committee. Im pleased to be here today to discuss the final results of g. A. O. s undercover test addressing the emerald controls of the marketplace set up under the Affordable Care act of 2010. As you mentioned, we reported our preliminary results during testimony in july of 2014. We performed 18 undercover tests, 12 of which involved phone or online applications. Our tests were designed specifically to identify indicators of potential control weaknesses in the marketplaces and enrollment processes specifically for plan year 2014 and to inform our ongoing Forensic Audit of these controls. I would note that our tests, while illustrative and as Ranking Member wyden mentioned cannot be generalized to the publication population of enrollees. Further, we shared details of our observations with c. M. S. During the course of our tests to seek its responses to the issues we raised. In this regard, c. M. S. Officials stated they had limited spacity capacity to respond to attempts of fraud and must balance consumers ability to access coverage with Program Integrity concerns. Without providing details on how and when, these officials stated that they intend to assess the marketplaces eligibility determination process. In terms of context, Health Coverage offered through the marketplace is a significant expenditure for the federal government. Levels of coverage involved several million enrollees, about 85 of whom are estimated to be receiving subsidies. C. B. O. Pegged costs for f. Y. 2015 at 28 billion and 850 billion for fiscal years from 20162025. A program of this scope and scale is inherently at risk for errors, including improper payments and fraudulent activity. Accordingly, it is essential that there are effective enrollment controls in place to help narrow the window of opportunity for such risks, hence the importance of our undercover tests. Witness as backdrop, i will discuss some of our test results. The marketplace approved subsidized coverage for 11 of our 12 fictitious applicants. These applicants obtained about 30,000 in total advanced annual tax credits and eligibility for lower cost at time of service. For seven of the 11 applicants, we intentionally didnt submit all required documentation and didnt cancel coverage or reduce or eliminate subsidies for these applicants. I would note that while subsidies including those granted to our applicants are not directly to enrollees, they nevertheless represent the financial benefit to consumers and a cost to the government. As part of its verification process, the marketplace didnt accurately record all inconsistenties which occur when Applicant Information does not match information from marketplace verification sources. Also the marketplace resolved , inconsistencies from our fictitious applications. The marketplace didnt term nays terminate any kind of coverage for several types of inconsistencies including Social Security data. We found errors in information reported by the marketplace for tax filing purposes for three of of our 11 enrollees such as , incorrect coverage periods or subsidy amounts. Under the aca, filing a federal tax return is a key control element designed to ensure that premium subsidies granted at time of application are appropriate based on reported applicant earnings during the coverage year. The marketplace automatically reenrolled coverage for all 11 applicants for plan year 2015. Later based on what it said were new applications our enrollees had filed, but which we hadnt actually made. The marketplace terminated coverage for six of the 11 enrollees, saying they hadnt provided necessary documentation. However for five of the six terminations, we subsequently obtained reinstatements. Including increases in monthly subsidies averaging about 10 . In closing, our test results highlight the need for c. M. S. To have controls to reduce the risk for potential improper payments and fraud, however there are such risks to be embedded early in a major new benefits program. We plan to include initial recommendations for controls and a forthcoming report could mr. Mr. Chairman this concludes my , statement and i look forward to the committees questions. Sen. Hatch its come to my attention that the g. A. O. Had difficulty getting enrollment and related data from c. M. S. To conduct a full analysis of what really happened to enrollees from 2014. Now this would have been helpful to g. A. O. In providing explanation for things like those who were supposed to get dropped for failing to provide documents to clear inconsistencies among other things. Can you provide us with more detail about the difficulties g. A. O. Had in obtaining that information from c. M. S. And i expect g. A. O. Has the data and expect c. M. S. Works with you and the committee tore make that to make that happen. Any information you can provide as to the problems experienced and what the committee can do to help address them would be helpful to us and the committee now. Mr. Bagdoyan thank you for your question, mr. Chairman. I will lay out in a general sense our experience in obtaining data. In the beginning i would like to , establish a context as i mentioned earlier why we did our uncover testing was to flag indicators of potential control weaknesses and at the same time, we had designed our Forensic Audit which relied on the data base in order for us to map out what we were finding in the controlled environment against the actual enrollees that Ranking Member wyden mentioned earlier. That said, we began our informal meetings in consultations with c. M. S. In april of 2014. We requested various data tests. We had some success in obtaining information. And when we focused on the enrollee data base, we submitted a written letter requesting that database in august of 2014 and then we subsequently engaged in additional conversations as they expressed some concerns about what we were asking and what we planned to do with the data as well as how the data would be safeguarded. Upon subsequent discussions through early part of 2015, we submitted another letter to then our current acting administrator in april of 2015 as of a couple of days ago we were in contact with cms, who advised that we should expect the data some time next week, which is very good news for us and our ability to continue the work. We look forward to obtaining the data and seeing if it is what we asked for. And then conducting additional tests to determine whether the data. Apologize for the long story but that gives you a context. Sen. Hatch i understand that the marketplace invoked the socalled good faith exception for plan year 2014 and not pursuing the documentation to reconcile inconsistencies they provided and that available to the marketplace or government sources. Could you describe what the good faith exemption is all about whether it has any basis in the a. C. A. , Affordable Care act, or its implementing regulations and the impact if any of its invocation on present controls and integrity. Mr. Bagdoyan sure, the good faith provision is basically an interpretation by c. M. S. Of certain provisions in the statue itself and then its implementation. Essentially under this implementation c. M. S. Deemed that as long as an enrollee or applicant submits at least one document to support their application, they would have engaged in a good faith effort to meet the documentary request and accordingly remain a participant in their coverage. In terms of whether this has an impact on the controls, it is essentially one of the back end controls. The document verification process, that is. And depending on your point of view, whether thats adequate if someone is asked for seven documents and only submit one document, that can create a control gap and raise questions about the eligibility for participation. Sen. Hatch my time is up. Sen. Wyden thank you very much, mr. Chairman. My time is short and i would like you to give us yes or no answers to four questions. As of this morning, can you generalize from the 11 fictitious cases what the fraud rate would be for for the more than 10 million real americans who actually receive Health Care Coverage under the law, yes or no . Mr. Bagdoyan not as of this morning. Sen. Wyden you said in your testimony that tax returns, and i quote here, key element of back end controls. Its a major check that would shut down the fraudsters. As of this morning, can you file tax returns for any of these individuals, yes or no . Mr. Bagdoyan we did not. Sen. Wyden as of this morning, have you uncovered any real individuals who fraudulently obtained Health Coverage using g. A. O. s techniques, yes or no . Mr. Bagdoyan no. Sen. Wyden as of this morning, have you provided h. H. S. With the fictitious identities from your increase to g. A. O. So they can address the problems that you insist . Mr. Bagdoyan we have not. Sen. Wyden i reviewed this very carefully and given the answer that we have just heard, it is clear to me that the auditors have much more work to do before the committee to draw useful conclusions on this matter. And on this point with respect to the claims that the agency has not been responsive to the request for enrollment data, i very much respect the fact that federal agencies need to be responsive to requests from congress and the g. A. O. For information. However, i also want to take note of the fact that these enrollment records contain personal identifiable information on more than 10 million americans. Loss of their personal ly identifiable information is becoming a nightmare for millions of americans. Its my understanding that the agency and the auditors have worked out an agreement of how this information, one, can be turned over to g. A. O. And protected, and i think thats good. And second, its my understanding that the agency has turned over some 30,000 pages of documents to my colleague, senator portman, for his committee. So this notion that the government, the agency in particular, c. M. S. Is spending its day, morning, noon, and night in an attempt to stonewall on releasing this information, i think is not accurate given the facts i just cited. Thank you, mr. Chairman. Sen. Hatch senator grassley, youre next. Senator grassley in deference to my colleagues and a lot want to ask you questions, and thats because we have a pending six votes this morning, im going to ask one of three questions and im going to put the leadin up to my questions in the record. You presented c. M. S. With potential flaws. The flaws as i understand what you said, didnt get fixed. So my question is very simple. In your work with c. M. S. , do you believe that c. M. S. s attitude is enroll people first and worry about eligibility later, if at all . Mr. Bagdoyan from where we stand currently, c. M. S. Explanation has been that they have to balance the ease of access to coverage with Program Integrity controls. Based on our undercover work, i would say that there are gaps in these controls that have yet to be addressed and we continue to look at it through our forensic work, but as of now, i think the balance would favor access over Program Integrity. As we stand today. As we stand today. Senator grassley i yield back my time. Sen. Thune thank you, mr. Chairman. Thanks for holding the hearing i think its important talking about taxpayer dollars and making sure we are doing everything to see they are spent wisely and well. In your testimony, you highlight marketplaces are required by law to verify application information, yet it appears from to verify application information. Yet, it appears from your investigations and support the that the bus stops for no one. Especially since contractors are not required to detect wrought. It begs the question of whether you are currently aware of any effective front or back and or back and Fraud Protection used by the. Mr. Bagdoyan the forensic part of our work should be able to give us a good idea of what the controls are. We will take what we learned from the ever covere from the undercover test, and map those out from the Forensic Audit, and apply appropriate criteria, such as the internal control of the government and the forthcoming rain worked to manage fraud risk. Then we will have a more comprehensive view of the control environment. It is not for me to make a judgment like that. Taste on our work to date, im am not aware of that. Senator thune any Fraud Detection Program . Has the administration provided you with rationale as to why they would injure into contracts that do not require the contractors to have Fraud Protection capabilities . Mr. Bagdoyan as best as i can tell, the arrangement with the contractor is to process documents submitted in support of applications. The contractor confirmed that they are not required to detect fraud. That would be a different transaction at greater cost. Senator thune you said that your work is ongoing but is there any recommendation on how to improve the document verification process to sort out fraud, as opposed to just accept and documents . Mr. Bagdoyan as i mentioned in my Opening Statement, we are working on a forthcoming report in the fall timeframe, where we hope to have additional recommendations, and those that and those recommendations might cover that matter that you mentioned. As i mentioned earlier, we spoke with ms officials about things we were encountering. We discussed their view of that and we continue to have those discussions and await explanations in that regard. Senator thune my understanding is that several of the fictitious applications were approved and reapproved without ever submitting documentation to the marketplace. How can this be . Mr. Bagdoyan how can the marketplace continue to disperse a taxpayer dollars without receiving any documentation in response to the request . Mr. Bagdoyan we were automatically reenrolled without any action on our part or all 11 applicants. The subsequently then subsequently we found out that six had been dropped from coverage because they had not submitted any documents. Then, to carry that one step further, acting again as typical consumers, we sought to restore our coverage and we were successful five out of six times. Senator thune mr. Chairman, i would say that these are troubling results. 11 out of 12. I would say senator from or again, we need to get to the bottom of this. I do not think you can discount this kind of research and report. In june, the ss oig report revealed the administration could not verify whether 3 billion in subsidies was properly dispersed to Insurance Companies during the first few months of 2014. These are significant failures that need to be addressed in the system. I appreciate the hearing mr. Chairman, and i hope that we can can 10 you this dialogue with you, mr. Bagdoyan, as you continue your work to discover how to stop this sort of waste of taxpayer dollars in the future. We will turn to senator wyden for questions. I want to respond to my colleague. He knows im willing to work with him in a bipartisan way. Lets review what just happened. I asked mr. Bagdoyan if he uncovered any real individuals who fraudulently got tells coverage using these techniques. He answered no. In 2 previous enrollments, there were a quarter of a million individuals Health Care Coverage rescinded because they could not validate their documents. I will look at all of the ramifications of these 11 applicants, but lets do it in a bipartisan way when we have recommendations. Mr. Bagdoyan said he does not have any recommendations to give us. We are doing this in a bipartisan way, but we cannot ignore some of this testimony. Thank you for your help on this and your work on the committee. My friend talked about how hhs has been responsive. You have indicated that they have not been responsive in providing documentation. Only 2000 were responsive. All were asking for is a schedule to submit documents. If we have time, i would like to hear your response, but i know you have had the same frustrations in regard to this is you. There is a policy problem here. Not only that 11 of 12 of these fictitious people got through and wer react, and five are brought out of brought back into the system when they should not have then when six were kicked out. Let me ask you a couple of questions. Your statement mentioned an additional identity test was failed. But they passed this step after calling hhs. What did you do to verify the identity, and why is that significant . Mr. Bagdoyan as i mentioned earlier, we were able to extend coverage by following the systems instructions. We failed the initial online test, we contacted the contractor, they could not clear it, then they instructed us to call the marketplace, which we did. Then we obtained coverage. It was a phone call. Senator wyden after being denied twice, people got back in. This is a policy issue. Somehow, your people snuck in. Mr. Bagdoyan we would do that, senator, as an indicator of a control gap. I know that is a technical and dirty thing to say. Senator portman you can get in by a self attestation with no proof. In some cases, joe submitted only some of the documents but received coverage in subsidies because of the goodfaith exemption. Can you describe that policy, and why it enabled you to receive coverage and subsidies. And the legal basis that dhhs used in implementing it. Mr. Bagdoyan senator portman, we are awaiting a response from chs. Were trying to get clarity on that. Under the goodfaith provision, whatever the term is, essentially, the applicant is compliant with their obligation to submit documents as long as they submitted one out of how many they are asked to submit senator portman . Your results said this is not a result of a statistical quirk, it is a result of policy being implemented as planned. Anyone using the Affordable Care act should be aware of this, because it shows that people can receive the subsidies. We should do more research. These are policy issues that are being applied today as we talk. Your statement notes that this investigation was doned backstopping is. Can you explain what backstopping is, and why it is important . Mr. Bagdoyan it is the extent to which we employ investigative techniques. I do not want to speak for my colleague who runs the investigative side of things but it was a simple thing to do. Using commonly Available Software materials and other approaches. Mr. Portman you didnt use any inside information, you just came as it as any consumer would, which makes your results, again, more troubling than they might otherwise be. I think these are really important aspects to your report and i think from a legislative perspective, an oversight perspective, it makes this much more serious. The final thing ill say is the amount of confusion this is causing people who legitimately are trying to get a subsidy is unbelievable. H r block say 2 3 of people are getting their tax returns cut or getting a tax bill. The i. R. S. Has told me half of the people this year are in that situation. This is not just about verification flaws, as you said, the lack of controls and lack of balance between accessibility, pushing people to get enrollment numbers up, versus the verification, its also about a lot of confusion for consumers. Thank you, mr. Chairman. Mr. Scott quick question for you. Did you look for any real people who attempted to deceive the system . Mr. Bagdoyan good question. We did not. As i mentioned earlier. Mr. Scott thank you. Is it your job to figure out the number of fraudulent accounts receiving subsidies and Health Care Coverage on healthcare. Gov . Mr. Bagdoyan not at this stage of our work. Mr. Scott ok. Of the 50,000 taxpayers who filed returns based on inaccurate subsidy data, how many of those did you review . Mr. Bagdoyan none. Mr. Scott because youre not the i. R. S. Mr. Bagdoyan thats correct. Mr. Scott ok. Theres no doubt that it was a disaster. A 4 million website that became synonymous with failure. We had a constituent in South Carolina who was trying to figure out how to get his information off the website that was used erroneously. We couldnt get a response from c. M. S. Finally had a Committee Hearing, an administrator was there. We were able to get some information and help solve that problem. One of the things that concerns me the most about the challenges that we face is that when you combine the subsidies, including medicaid subsidies, were talking about 1. 7 trillion of subsidies. And in the year 2025, well have about 31 million Americans Still without coverage. Perhaps after billions and billions of dollars of subsidies that have been received by people who do not deserve them it may indicate why well still have 31 million americans without insurance. My question to you is, outside of your investigation, how easy is it for most consumers to falsify their information in order to receive higher subsidies based on your fictitious individuals . Mr. Bagdoyan as i mentioned earlier in the response to senator portman, it was relatively straightforward for us. I certainly cannot project that to the typical consumer. But there is a lot of information out there available for people who are committed to performing fraudulent activities. Mr. Scott it appears to me that there seems to be almost a perverse incentive for relaxed accountability as it relates to internal controls because it seems to have led and will continue to lead towards higher enrollments. Thoughts . Mr. Bagdoyan i would take you to my Opening Statement regarding the balance between access and control. It appears based on our limited results from our undercover tests that the balance is more towards access than control. Our work continues. Well have more definitive views on that in the future. Mr. Scott said in fewer words if its tilted toward access and controls, the chances are pretty high that someone will be able to get on, as did you with, 11 fictitious individuals and get coverage, even if they were doing it at home on their healthcare. Gov versus the g. A. O. Doing it, basically the same results. Is there anything that would lead to a different conclusion from your experience so far . Mr. Bagdoyan well, i think the Forensic Audit that well conduct on the entire population will give us a complete picture of what happened, whether there were additional real flags that we need to follow up on. But at this point i cant really project one way or the other. Mr. Scott i appreciate a followup of that information in writing, then. That would be wonderful. Thank you. I would say to my colleagues that the reality of it is, what happens when you have individuals receiving subsidies that they have not earned, do not have a right to, when its 1. 7 trillion over the next eight or nine years, what that results in in South Carolina is what weve seen this past year is between a 31 and as high on some plans a 50 increase in premiums. Thats astounding. Its ridiculous. Its unaffordable. As those premiums continue to climb, what weve also seen is your deductibles get higher, more expensive. Your outofpocket expenses are higher, more expensive. And the number of facilities whether its hospitals or doctors that are available to use that access card, continues to dwindle down and down and down. Im not sure what good access is because you have a card, when theres not a Health Care Provider on the other side. Thank you, mr. Chairman. Mr. Coats thank you, mr. Chairman. Im not surprised with anything ive heard here this morning. I go to the senate floor once a week to identify not to identify but to share with my colleagues a proven waste fraud and abuse in any number of ways and any number of agencies. We have a loaded bureaucratic, dysfunctional government that tries to do, some with real intent, good intent, tries to do more than it can handle. Thank god for g. A. O. And for the nonpartisan work that you do to help us point out ways in which we can help a struggling taxpayer not have to pay so much money into washington to function something that doesnt work. So i really appreciate you being here, i appreciate your candidness. How we can take this for anything other than a canary in the mine saying, hey, theres a problem here, lets get after it, what really is discouraging, and id like more details on this, you take these findings to c. M. S. And c. M. S. Basically gives you a stall. Were waiting for the attorneys to respond. I cant c. M. S. Should say thank you, thank you, youve pointed out some weaknesses here that we werent aware of. We want to be efficient. Actually, we want to implement the president s program. We want to sign up more people. I mean, theyre obviously following that mandate. And this will help us, because if this becomes public, public is going to say, just one more example of a government, bloated, bureaucratic, inefficiency, infectiveness, preventing people who needed the insurance from getting the insurance, giving insurance to people who dont qualify and its fraudulent. And i hear that, you know, well, we got to go through all this process and so forth before we even implement things they shouldnt have to wait for you for recommendations. Youve told them, heres the problem. I would think they would say thank you. Let us, you know, were going to go after this right now and try to fix some of these things. You pointed out something that obviously, sure, its fictitious. But i mean, if this isnt if this isnt an alarm bell in terms of dysfunction, i dont know what is. So, can you describe a little bit more your efforts with c. M. S. To get them to say, thank you, yes, this helps us, we see the weaknesses here, and were going to take steps to go forward, instead of some process thats going to take through the legal system and through the bureaucratic system, thats going to take months if not years, while more and more waste and fraud just continues. Mr. Bagdoyan sure, thank you for your question. Our exchanges with c. M. S. Have been fruitful at times and we have gotten their attention on some of the key issues that weve identified. Mr. Coats what about this issue . What youre presenting here. You said you went to c. M. S. And alerted them to the problem and youre waiting for their response. Mr. Bagdoyan that actually refers to the good faith exemption. Were waiting for their legal analysis, for their mr. Coats yeah, we hear this all the time. Mr. Bagdoyan working for the document verification process. Thats just one matter. Mr. Coats did it ring any alarm bells over at c. M. S. . Did anybody say, wow, thanks so much for bringing this to our attention, we need to plug these holes right away . Mr. Bagdoyan i dont know whether thank you was used but theyre aware of the problems that we flagged. Mr. Coats they didnt just say this is fictitious so what youre presenting is worthless . Mr. Bagdoyan , no i cant say that thats what they said. Mr. Coats im happy to hear that. I could waste the day or hour or minute thanks to g. A. O. And other investigative agencies that have pointed out that we have a dysfunctional government and were wasting taxpayer dollars faster than we can send them to washington. Mr. Chairman, thank you. Mr. Burr let me say thank you. Thank you to you and all the folks at g. A. O. For the great work that you do and for the difficult task that youre asked to do. According to your testimony, people applying for coverage are required to attest that the documents theyre providing are not false. C. M. S. Officials say that contractors processing these documents are not required to verify that these documents are authentic and that the contractors not equipment to identify fraud. C. M. S. Has also stated that there is no indication of meaningful levels of fraud. Do you think c. M. S. Made this statement because nobodys monitoring the enrollment process in a meaningful way to detect the fraud thats clearly occurring in the cases of fake g. A. O. Enrollees . Mr. Bagdoyan yeah, i think the statement from c. M. S. Is based on the fact that the contractor itself has not reported any fraud. But as you pointed out, theyre not tasked with looking for fraud. Thats not in their work order, thats not mr. Burr how many people did you find, you hadnt been asked to go look, therefore you didnt find any, right . Mr. Bagdoyan at this stage, thats correct. But once we move over to the forensic look, the entire enrollee database, that might yield difficult results. Mr. Burr whos ultimately in charge of the integrity . Is it the c. M. S. Administrator deputy administrator, the chief information officer, who is actually the one on the hook for ensuring that fraud is not occurring within the enrollment process . Mr. Bagdoyan sure, as a general proposition, i would say that the tone at the top is important. Whether its the administrator who is responsible for c. M. S. And his or her staff, it is leadership that sets the controls in place, ensuring that they are working as intended monitors their effectiveness and then responds to any changes in the environment that may necessitate adjustments or changes. Mr. Burr senator wyden came to an interesting conclusion that what youve testified on really isnt valid because none of the individual enrollees filed an income tax. Therefore you didnt allow the system as designed to catch that they shouldnt be there. Your own testimony says that in correspondence between the applicant and the marketplace, that on four of the individuals, the marketplaces correspondence to the applicant referred to their filed tax returns. In other words, the marketplace basically said, four of your applicants filed income tax returns and thats what we make our judgment on. When in fact none of them filed tax returns. And you stated that in your testimony. So, let me just say to my colleagues, whats my takeaway here . Not only do we have policy deficiencies, but we have indications of incompetence or intent to ignore the law. That should be the concern of this committee, it should be the concern of the American People and i hope that g. A. O. Will continue with the instructions from the chair to look deeply into this. Thank you for your work. Mr. Bagdoyan thank you, senator. Mr. Casey mr. Chairman, thanks very much. I want to say first to mr. Bagdoyan, that in my experience as an elected official in pennsylvania, one of the most significant parts of that time as a public official was as the state auditor general, an elected position elected to two terms, so i spent eight years doing it. I have some sense, even though i was overseeing a group of auditors or investigators, by some sense of the difficulty of your work. And a good sense of the reaction you get when your work is completed. I respect and appreciate what you do. Its difficult. I wanted to ask you one question more just to make sure the record is clear and then i want to get into more of the specific health care issues. I want to make sure i have this right. Based upon your testimony, is it possible to make generalizations about the full population of applicants in the marketplace . Mr. Bagdoyan no, it isnt. That was not the intent of our undercover test. Mr. Casey i wanted to say just preliminarily, we know, those of us who voted for the Affordable Care act, we know that there are issues weve got to correct. Its not perfect legislation, nor is any legislation of that complexity and impact on health care and on our economy. A number of us have voted for already improvements to the law. I think whats indisputable though, in addition to the fact that its not perfect, is that theres been a substantial benefit conferred upon a lot of americans that wouldnt have it otherwise. Im not saying this for your benefit, really just for the record. 16. 4 Million People gained Health Insurance coverage in the time since 2010. In pennsylvania, for example 472,697 pennsylvanians selected plans or were automatically reenrolled through the Health Insurance marketplace. About 81 of pennsylvanians who selected Health Insurance plans were elected available for financial assistance. Lots of examples of individuals, two individuals from southeastern pennsylvania, jenny and david, are selfemployed have two sons in college jennys a Breast Cancer survivor, worried about being denied Health Insurance because of her preexisting condition. They were spending over 10,000 a year on Health Insurance. Thanks to their a. C. A. Plan, they now are spending about 3,000 per year. So the savings help them on college costs. Such is by way of background. But i want to ask you a specific question about your work. Do you think there are additional checks that can be imposed upon the system so to speak, that could help identify fraud, which the g. A. O. Did not test . Mr. Bagdoyan sure. Thank you for your question. That would be a major part of our focus for the ongoing work. As i mentioned, i believe earlier in response to another senators question, we will be applying a set of appropriate benchmarks to how we map out im sorry, the current process that we obtained information from undercover work, the forensic work will inform, go in tandem, and once we apply those criteria, well be able to identify how to best respond to them. Whether theyre risk assessments, implementation of specific controls for specific parts of the enrollment process, that will be key. But that work is ongoing. So i cant really say one way or the other which way well go with the recommendations. Mr. Casey part of that is, i guess this is always difficult when you have mandate, but you also have limited resources, you cant audit every or review every transaction or every part of the system. So you do sometimes have to make a determination based upon risk. Whats a higher risk, whats a mr. Bagdoyan sure. Prioritize where you attack first in terms of control gaps sure. Mr. Casey i wanted to ask you too, to what extent you believe the i. R. S. Has the capacity to identify fraudulent socalled aptc claims. Do you have any sense of that . Mr. Bagdoyan i do not. That is not part of our scope on this ongoing work, but i believe there are other Mission Teams within g. A. O. That are taking a look at that. I dont know the specific aspects, but i believe i. R. S. Capacity and capability is part of that work. Mr. Casey were grateful for your work. Its difficult. But its essential and we want to make sure that we get this right over time and one of the ways to inform how we do our work in terms of legislative change or corrections is to have information from g. A. O. And other sources. We appreciate your work. Mr. Bagdoyan thank you. Mr. Wyden one last yes or no answer. Is it correct that c. M. S. Asked for these 11 fictitious cases and g. A. O. Did not give them to the agency . Mr. Bagdoyan thats correct. Mr. Wyden i would again say pretty hard to evaluate something you arent told about. Certainly cant fix something you dont know about. By the way, senator byrds question, could you have gotten an answer to it if you had actually been able to get the information about these 11 fictitious cases. By the way, my staff asked for the information about these 11 fictitious cases. So, you know, to me the message here, and chairman hatch knows i am interested in working with him in a bipartisan way, i think im about as bipartisan on health care as anybody, you know, in the senate, i just think that without these recommendations, which weve been told they are not ready to go, this is premature, at some point i believe g. A. O. , ive worked with them often in the past, admire their professionalism, will give us some recommendations, they must work in a bipartisan way. I hope what people following this will recognize is as of this morning, General Accounting Office not covered any instances of real people committing fraud as part of this inquiry. I think thats an important takeaway this morning. Thank you, mr. Chairman. Mr. Bagdoyan, it is true that your job is to look for fraud, it is to look for misconceptions. Your job is to look for things that are wrong or out of whack or whatever you want to call it. Thats what youre doing, right . Mr. Bagdoyan thats correct. Mr. Hatch and youve done it honestly, right . Mr. Bagdoyan yes. Mr. Hatch youre disturbed by the fact that these discrepancies exist, even though its been a limited investigation. Is that right . Mr. Bagdoyan we do have concerns about the flags weve detected. In terms of the control environment. Mr. Hatch youre expressing those concerns here today. I have concerns too. A lot on our side dont believe that obamacare is ever going to work. And that its just going to continue to take us downhill with more and more costs and more and more expenses and more and more fraud. This isnt the only instance of fraud either, is it . Mr. Bagdoyan i cant comment on that, out of scope. But if i may, mr. Chairman. Try to explain our decision to mr. Hatch i dont want people just slapping this off like this isnt important. Its very important. Mr. Bagdoyan right. Id like to, if i may again, mr. Hatch i want you to tell us why it is so very important. Mr. Bagdoyan its important in terms of getting the responses that we need as our work is ongoing. I would respectfully ask that i explain why we decline to provide our identities of the 11 applicants. Mr. Hatch sure. Mr. Bagdoyan that is fully consist went g. A. O. Policy protocols and practice that we do not divulge any information related to our sources methods and investigative techniques, to any entity, so that we protect those for future use and so thats our perspective on that issue. Mr. Hatch why is that . Why cant you divulge . Mr. Bagdoyan we cant because we have the sources and methods that i mentioned that need to stay confidential, that are in general use by g. A. O. And certain circumstances. So revealing those would basically give up the ghost. Mr. Hatch my understanding is i am the Ranking Member of our House Committee on commerce. We have other members joining us, as well as one member who joined us from maryland who is not on the committee. We are the committee with jurisdiction over the issue of Climate Change. We are very appreciative of the fact that the academy was willing to host us today for this hearing on Climate Change at the waters edge, as we are terming it. First of all, i would like to stay each of them will make an Opening Statement, but i do want to thank the congressman to my left representing an annapolis, who is a member of the energy and Commerce Committee who did most of the preparation with his staff to bring us here today. To his left is congressman paul congo who is from new york and the Ranking Member of our subcommittee on in dimon and the economy. To his left is congressman Chrisman Holland who is not on the subcommittee, but is in the house leadership from a conjoining congressional district. That is the four of us up. Today that are conduct a the fields hearing. Of course, i want to thank vice admiral carter, the super attendant, for hosting us at the academy. I had the opportunity as i mentioned this morning, of having a wonderful tour by some of your staff. I should not admit that after 27 years in congress i have never been to the academy before, but i could not miss the opportunity to do the tour. It was very interesting. Thank you for hosting us in making preparations. We also have mayor pantaleo need the mayor from annapolis. Yesterday, the National Oceanic and Atmospheric Association released its climate report from 2014. It uses data from around the globe. The noaa report confirmed what we know, that had made Climate Change is real happening now and the evidence is undisputed. I quote, numeral four independent data sets concluded that 214 the 2014 was the warmest year on record. 17 of 18 warmest years on record have occurred in the last 18 years. The report noted that sees surface temperatures were out a record high, and the ocean heat content was at a record high. The sea level was at a record high, the arctic continue to warm and there was a above average number of tropical cyclones. It is clear that records setting Climate Change continues unabated. Record Sea Level Rise happened to 2014. It is a direct result of our continued in maintenance of Greenhouse Gases. Noaa noted that in the United States 40 of the population lives in high ambulation density coastal areas where sea level plays parts in erosion and storms. In new jersey, her Hurricane Sandy hit with devastating intensity causing damage and loss of life. An annapolis coastal flooding is increasing in an exponential rate and an annapolis is preparing for the next extreme storm, like sandy. Vice admiral carter can tell us about the preparations the navy is taking for flooding at their facility here. Those of you who are arguing that Climate Change is not happening or caused by human activity argue in the face of scientific that, and speak on behalf of of those who want to continue profiting from nonaction. There are those who continue ignoring Climate Change. And that those actions fall on all of us and our enormous. Some drought, impact on Fruit Production increases on security risks and diseases. When we ignore Climate Change we missed opportunities to move forward to a more economic and sustainable future, one where we are more Competitive Energy independent, and energy secure. We miss losing the lead on Energy Solutions and jobs. We need to heed the advice of our military advisers, mayors scientists and best thinkers to combat the threat of Climate Change. I think the members for their participation and look forward to the testimony of witnesses. I now yield to your hometown congressman. Thank you. It is great to be here at the Naval Academy. I would like to thank superintendent carter for hosting us. This is the Perfect Place to bring attention to the issue of Climate Change and what local communities are doing to combat the effects of Climate Change. I do want, on the outset, to acknowledge the tragic shooting that happened yesterday in chattanooga. I know that you have it shipment that go on to become part of the officer corps of the marine so this community is probably feeling that loss acutely. Our thoughts and prayers go out to the big terms of that shooting our thoughts and prayers got to the victims of that shooting which occurred yesterday. I would like to thank my colleagues for being here. They are very focused, as the whole committee is, on the issue of Climate Change. And Chris Van Hollen, who is on the democratic caucus. And from that position understands that addressing issues of Climate Change about the values that we infuse in budgetary documents we create in washington. I also want to thank witnesses. We will introduce them in a moment. I want to wait knowledge there are a lot of people in the audience today who care about this issue. The film have worked long and hard, not only on the broader issues of Climate Change, but on the issues of the fortunes of the Chesapeake Bay, which marylanders hold very dear to our hearts, but there are obviously many who are part of the solution when it comes to the Chesapeake Bay since it begins in new york, actually. There are 17 million residents within the Chesapeake Bay watershed, which is 64,000 square miles. We have a special responsibility when it comes to leadership to make sure we are doing and preserving the Chesapeake Bay. To make sure we are protect thing and preserving the Chesapeake Bay. The consensus from the Scientific Community is overwhelming that Climate Change is happening, and that human at trinity is the most significant cause. Whatever debates we are having whatever the issue may be, it is all happening inside of this larger reality of what is happening to the planet. Every issue that we grapple with, that should be the baseline effort that we are undertaking, to address Climate Change. So that all of the other things do not become irrelevant over time. We are in the beautiful city of annapolis to hear about some of the local effects of Climate Change on coastal communities. Annapolis is on the front lines when it comes to that. Unfortunately, sometimes in washington politics take over this conversation. It is good to get out of washington into the communities that are grappling with this issue, where you find a real consensus that this is a priority that has to be addressed. We have assembled a strong panel of leaders on this issue that we will hear from today. There is no question that this is the challenge of our generation addressing Climate Change. The American Public is is focused on it as our witnesses and we are. Recent polling shows that 70 of americans favor stronger limits on the amount of carbon admitted by power plants. Over 80 of americans think the United States should take action to address Climate Change. The public understands this. The experts understand this. The Scientific Community understands it. The United States Congress Needs to catch up with that. For time we thought we would be able to put in place a kind of superstructure to address Carbon Emissions with economics being a driver, but that opportunity was missed stepping into the breach has been the environmental reduction agency, the Clean Power Plan with other efforts they are using to address Carbon Emissions, which is important, but Congress Needs to get back to the task of being a leader when it comes to addressing this important issue. We will hear testimony that belies the notion that there is a tradeoff between a Strong Economy and doing the right thing when it comes to the environment and Climate Change. In fact, when you look at the Chesapeake Bay, the best way that we can drive the economic engine of maryland and this region is to make sure that the Chesapeake Bay is healthy. There is a direct link. If we develop Clean Power Technologies because we are looking ahead to the future, and learn to manufacture and produce technologies in the United States, that will generate a tremendous number of jobs. Addressing Climate Change is a clear priority. We have a wonderful panel assembled. Thank you, superintendent for hosting us. I yield back my time. Congressmen pallone next we have the congressman from new york who is the Ranking Member of our environment and economy subcommittee. Did morning. It is a pleasure to join you. Thank you superintendent carter for hosting us, and thank you mayor, for welcoming us to this city. I had a chance to hit the state house and visit the campus. It was a beautiful space. Thank you for the good work that you do at the academy. We are thrilled to be working with you to appoint nominees to the various academies. It is a nice partnership. To all of our witnesses, thank you for being here. We talked about the roles that cities play in our research and as an economy. I would like to thank the great work done to keep us a strong nation. Thank you, your strengths are very valuable. Im proud to represent a state that is part of the watershed community of the Chesapeake Bay. Although it is a slight part, we love being part of the watershed. We thank you for your work that you do and sending information our way so we can move forward in an academic way. I represent the district that is the consulate of the hudson and mohawk rivers. It is from saratoga to albany troy, and into the erie can now territory. The erie canal territory. Our coastal communities have been impacted by Mother Nature in significant ways. I think the work we are doing today is very valuable to the outcome of Public Safety economic stability, and economic growth, and an environmental agenda that is strong and reflective of our stewardship and our partnership with the environment. I am an engineer by background. I enjoy technical assignments. I enjoy working with the rancor of energy and commerce. Im thrilled to be sitting with three colleagues who get it. Theyre really stalwart in their efforts to make a difference on behalf of our environment, and that is refreshing. I enjoy technical assignments. My rancor ship on the subcommittee of environments and the economy, and i said on science, space, and technology. Im amazed at the people who reject science who should be advancing the best policy, and what science is telling us. Listen to Mother Nature she may be speaking more forcefully than science itself, but we need an aggressive agenda based in academics. Stewardship of the environment and growth of the economy do not fight each other. They go hand in hand. Great jobs come about when we understand that partnership. Before my days in congress i was the president and ceo of the new York State Research and Development Authority where we did innovation and invention when it came to energy and the environment. Prototypes developed in that partnership was growing jobs. It enabled us to strengthen the foundation of our economic recovery. I also believe and accept in the notion that 97 of the Science Community says Climate Change is real and human factor is very much a part of the concept, so we could make fundamental changes based on human activity. If we think Carbon Emissions is not a problem, wait until methane hits us. There are things coming forward that need to address omissions in our society. The growth and impact the growth in the economy, in the impact we can avoid are hard to sell at times, we know that. It is important to move forward with preventative measures. My district, and all of metro new york, are hit hard by Mother Nature with superstorm sandy. Before that irene ripped into my district. And 500 year storms or being embraced every other year, multiple times in a decade. The nomenclature is outmoded and outdated. We see stress to our waterfronts, the closing of businesses, the erosion of farmland, Housing Stock that is abandoned, and human lives that have been lost because of the storms. We know there is a way to speak to a sound agenda that grows jobs and for text environment, and allows us to anchor it in policy and put together resources that we need. It is my pleasure to be here and thank you to my fellow colleagues panelists and all for showing interest in this issue. I hit the ice cream shop downtown, im not embarrassed to have had a cone at 10 00 a. M. And i talked to a young man who said, what are you here for . I said im going to the academy for a discussion on Climate Change. He said, please do something. Maybe it is the Younger Generation that will push us. Congressmen pallone let me yield to congressmen Chris Van Hollen who is the Ranking Member. Congressman van hollen thank you. Let me join my colleagues in thanking you, superintendent carter and the witnesses for joining us this morning for this very important discussion. Superintendent carter, as my colleagues have done, i want to thank you for your stewardship of this institution that helps train men and women who serve our country. Thank you. Esther mayor, mr. Mayor thank you for your leadership, and we look forward to your testimony on this issue and the effects that Climate Change is having in the city of annapolis. Mr. Baker, thank you for your leadership and protecting the Chesapeake Bay. As our motto in maryland we have save the bay. Mr. Baker is the head of the Chesapeake Bay foundation, which has been leading that effort for long time. Thank you for the union of concerned scientists for your leadership, your contributions to the scientific debate, and for translating that scientific analysis into sound public policy. Im grateful for your efforts. I would like to thank the leading him a crack for bringing us here. Thank you esther thank you mr. Pallone or your leadership. We have worked very closely together on Chesapeake Bay protection. We have worked hard to encourage young people are to appreciate the art to appreciate the great outdoors. Thank you for your leadership. Paul, who is helping new yorkers recognize that they are also part of the Chesapeake Bay watershed. A challenge we have had in maryland is that we understand what a Precious Resource we have in the Chesapeake Bay, but the they watershed the Chesapeake Bay watershed continues up to new york. The ratio of landmass to water is huge. That is why it is such a challenge to make sure that we continue to protect the bay. L i want to underscore a couple of points. I wish that all members of congress are the same level of understanding of the challenges and threats as the American People are. We continue to have science deniers in the United States congress. People who can stare the evidence in the face and still put their heads in the sand. The American Public is ahead of the game. They recognize this is not a distant threat, but here and now. They see it in the form of these disruptive weather events that are increasing the costs to the American Public, to the citizens of annapolis, they recognize it puts lives at risk as mr. Tonko mentioned. They are able to see with their own eyes what the data indicates. We know the costs of doing nothing are huge. We will hear testimony about how those costs are piling up because of lack of action in washington and other places around the world. I am pleased we are at the table academy, because the u. S. Military has been at the forefront of trying to understand this challenge and threat. For those who deny the evidence, they should ask the u. S. Military who is charged with protecting the country from this threat. The military said this is a threat multiplier, Climate Change intensifies existing threats around the world, and obviously piles on costs on top of that. Rather than let the cost pileup and do nothing, we should take action. The president has put forward a Climate Action plan, and i salute him, but the president will be the first to knowledge like all of us in this room, there are better and more efficient ways of addressing Climate Change. There have been proposals put on the table in the past. I put forward a cap and dividend proposal which would take us in the right direction. The union of concerned scientists and other organizations have been supportive of that. The bottom line is that we have to act. It is not only a question of cost avoidance, it is a question of huge economic opportunity. By investing in a clean energy economy, not only do we avoid the costs of damage from Climate Change and save lives, we create huge Economic Opportunities for the country in the process. Hopefully, and im sure the testimony today will highlight the costs we are facing in the here and now, as well as opportunities we have as a country if we address the challenge in the right way. Thank you. Congressmen pallone i will now turn it back to congressman sarbanes to introduce the panel. Then we will have each panel member say a statement, starting with the mayor and going to the right. Congressmen sarbanes our first witness is the mayor. He was elected in november of 2013 as the most recent mayor of annapolis, and the citys first republican mayor since 1997. As i indicated earlier, when we get outside of washington, where sometimes the politics can be aggressive, and out where people live, we find republicans and democrats working together on important issues like the ones we will be discussing today. The mayor is a board member on the and annapolis and Anne Arundel County visitors bureau, he is on the legislative committee where he has leadership positions. He has rallied the people of annapolis around this very important issue, recognizing the threat of title flooding to the city of annapolis. Of tidal flooding to the city of annapolis. This morning we had an event which will punctuate the topic for todays hearing. Were looking forward to the vice admiral walter ted cardinal does carter became the 66 attended he is a native of burrillville, rhode island. He graduated from the academy here in 1981. He was designated a naval flood officer flight officer, and graduated top gun in 1985. He completed the air command and Staff College course in the Staff College. In 2001, he completed the navys Nuclear Power program. If i told you all of the various words and recognitions he has reese, we would not be able to hold the hearing today. Needless to say, he has excelled in everything he has attempted. I will mention this admiral carter flew 125 combat missions in support of bosnia, afghanistan, kuwait. He accumulated he safely completed 2016 carrier arrested landings, which is the record among all act as an retired u. S. Naval aviation active and retired u. S. Naval aviation. We are looking forward to your testimony today admiral. Will baker is a man on a mission. He began his career at the chesapeake a foundation as an intern Chesapeake Bay foundation as an intern, and decided he was going to take this operation over, which he did, he coming president in 1982. Leaving the largest nonprofit Conservation Organization dedicated solely to preserving, protecting, and restoring the Chesapeake Bay. I want to thank him for his efforts on how we connect young people to the environment to promote environmental the across the country. He has helped immensely in welding a cold in building a coalition on the no child left outside act. We are blessed that he made the protection preservation of the Chesapeake Bay his lifes work because it has made a tremendous difference. The Chesapeake Bay foundation has received any or, and that includes many awards, and that includes the president ial medal for environmental excellence in recognition of its Environmental Education program. That in many ways is a recognition of will baker and his commitment to these issues for so many years. We are looking forward to his testimony. Our last witness is a senior climate scientist with the climate and Energy Program at the union of concerned scientists. She is leading ucs and working at strengthening support for sound u. S. Climate policy. Prior to joining ucs, she was on the factory of the on the faculty of the department the university of arizona. She was a hydrologist working with communities to protect groundwater sources at the Connecticut Department of environmental protection. She holds a ph d a phd from columbia university. She has conducted postdoctoral research. She is an expert. We are looking forward to hearing from her today. Thank you. We will start with the mayor. Thank you. Good morning. Thank you and welcome to annapolis. Wed appreciate you choosing our city to surely in packs of Climate Change on local communities and using this discussion to create policies for congress. It is a pleasure to work alongside vice admiral cardinal carter. Thank you for being here. Annapolis saw the greatest increase in nuisance flooding in the last 50 years. Nuisance flooding, measured in average nuisance floods per day increased by 925 , from an average of four floods per year to an average of 40. Annapolis had the largest number of nuisance floods at 40 i year, with washington, d. C. A distant second at 30. To this end, the city of annapolis has been meeting with local and state entities september 2014 to adjust flooding in our historic city. The city recently presented a weather together town hall. If congress as congressman sergey and set, we have to rally as congressman sardines said, we have to rally the community. We had one person show up on the budget. Something that surprised a lot of us and definitely the citizens. It is a multi Agency Initiative that the city of annapolis has to develop a plan and implement a strategy which will reduce the risk and loss of private and Public Sector properties most vulnerable to the effects of Climate Change. This is an 18 month planning effort which represents an important collaborative project tween the city state, federal Agencies Private and nonprofit partners. Anything you do, you need to build partnerships and relationships. We cannot address flooding without the help of congress the Naval Academy, and our partners in state and federal government. Who is responsible for reducing flood potential in the Historic District . 32 said it was the local government 32 put it on the state. We all have been doing work to address new its nuisance flooding. We are currently working to develop a Cultural Resource Hazard Mitigation plan design which will be a model resilience the response for historic properties. We are working on the regulatory response of the sealevel rise and storm surge induction. We are also currently working on a sealevel rise plan. These are some Major Projects that the city has dedicated money towards, and i want to thank all the partners who have dedicated money to these endeavors. We have completed a number of state funded planning documents including the sealevel rise vulnerability assessment, our indignation mitigation strategies. There is still more to do change critical dollars are needed. I think a lot of times people think of sealevel rise and Climate Change is affecting downtown. There are other parts of annapolis that are affected as well. Still, we all understand today we have secured funding for 172,003 and 98. We all understand that more money is needed. The preliminary planning and design process holds in touch holds a price tag of 1 million. Flood mitigation was our number one ask. Im sure you are all familiar with the local municipalities asking you for money. It was our largest ask from the state of maryland and will continue to be this year. As we look for funding opportunities in 2015, we hope for an additional 45,000 for the National Center Reservation Technology and training and in 2016, we are turning to the american Emergency Management find to update the city of annapolis. We are seeking assistance from the Maryland Historic trust and the rockefeller 100 resiliency organization. Part of our goal is to be a model nationwide on how cities deal with this. The city of annapolis is still considered a National Model for Hazard Mitigation planning. No other Historic District has attempted to develop a full scale fema mitigation plan to dress sealevel rise to address sealevel rise. Given the importance, the annapolis response to sealevel rise must be responsible for existing structures and infrastructure. Flood proofing while preserving the historic exterior of the building. Throughout my time in office, flood mitigation has been a top priority and i appreciate the administrations close work with the Naval Academy and Anne Arundel County executive. Thank you for the opportunity to testify, and i wish you much success. Thank you mayor. Admiral . Good morning, distinguished panel, and thank you for allowing us the privilege of hosting this important hearing here today. Before i make my prepared remarks, i would also like to say how sad it and how much saddened and how much we will send our thoughts and prayers to our family and chattanooga tennessee. As you all know, and you got to walk around the yard as we call it, this is a historic site. We started here on october 10 1845 so this year we will be entering into our 170th year of being a partner with the city of annapolis. It started out as 10 acres and today we represent about 303 acres. It is still a relatively small campus but one of which we are proud. If you were here early this morning, you would have seen the two roads right behind me were covered in two inches of water from a nuisance tied, sometimes called a king tide. This was as a result of rain that happened. You can still see the remnants on mcnair road right behind me. This is something we deal with. Mr. Chairman, distinguished members of this committee, thank you for the opportunity to appear before you today. Im pleased to risk port report solid progress in preparing for the effects of rising sea levels here at the Naval Academy. Before discussing the possible effects of rising sea levels, i would like to address our recent and ongoing efforts to accommodate heavy rain and high tide. Our institutional agility in dealing with flooding will directly impact our success in managing more drastic short and longterm climate related events. Simply put, we can better handle a major storm if we can manage surges caused by heavy rainfall and high tide. To control nuisance flooding, we have several projects in areas ages of implementation. The cooper road Stormwater Management project uses underground reservoirs to capture storm water. Stormwater remains in the reservoirs until the water table can naturally absorb it. The cooper road project has been very effective at managing stormwater that likely caused that previously caused flooding. We now utilize doorjambs at the ground floor openings, we have installed identified exterior building walls for use as floodwalls. Our upcoming cyber billing currently in procurement will be located on the corner of the yard where we occasionally experience nuisance flooding. This building will be located just adjacent to us between our library at nimitz and our engineering center, rick overhaul. It will be a 2000 plus square foot building, designed to act as a floodwall for the corner of the yard. I would like to discuss some of the Infrastructure Improvements we have made in the wake of Tropical Storm isabel. In 2003, isabel caused wide flooding widespread flooding throughout the yard and the total cost of repair was 120 million. We have taken similar measures to make sure a similar event will not have the same template detrimental impact. We have raised the ground level of new construction. Wesley brown fieldhouse was built above flood level and acts as a floodwall. We have raised electrical outlets on ground floors installed valves for underground tunnels and storm winds. Wear suitable, we have also identified opportunities for wet flood proofing, for buildings that are allowed to flood during a one in 100 year resources required to keep them dry would not be costeffective. Perhaps most effectively, we have instituted protocol for equipment and chemical relocation in the event of a major storm. To prepare for future flooding i recently charted the sealevel council. Captain the council also includes miss Sarah Phillips our architect of the Naval Academy who will use our academic will ensure coordination across commands. The sealevel Advisory Council will look to better project future sealevel changes indianapolis area and identify the Naval Academys vulnerabilities. We prioritize these on abilities and work to provide project solutions in preventing and minimizing damaging effects of inundation. Finally, i think it is important to mention some of the academic courses available to our midshipmen who will eventually be responsible for mitigating the longterm effects of the seawall rise. We currently offer two courses specifically designed to investigate this issue and educate its inheritors. The first is no sonography oceanography for 45, global Climate Change. This reviews the natural and Human Factors that influence the regional and global climate. We also offer Political Science 45. 345. It includes weekly outside speakers who present material from various perspectives, including representatives from industry, the military, and the advocacy community. Mr. Chairman, distinguished members, i thank you for the opportunity to appear before you today. The Naval Academy is aware of the risk of high rains and rising sea levels. We are studying and adapting to these risks to prioritize and develop future solutions to vulnerabilities. Thank you all very much. Thank you. Mr. Baker . Members of the committee congressman van hollen, thank you all very much for what you do. Distinguished colleagues on the panel and in the audience, thank you. I speak today for the over 200,000 members of the chesapeake a foundation, our board Chesapeake Bay foundation, our word, our staff. It is Getting Better but it is still a system dangerously out of balance. I use the word system because science has taught us to realize that the chesapeake is a collection of all the rivers that feed into it, and the mainstem. Fortunately, there is a plan in place to restore the chesapeake and all the rivers and streams. It is called the chesapeake clean water blueprint or the epa called it, the mother of all tmdl ss. It is a heavy lift. Global Climate Change will add to the burden. We are seeing the impact now. Right before our eyes. The Chesapeake Bay foundation hasnt our mental education enters has Environmental Education centers on smith island and tangier island. Residents of smith and tangier are losing their home. They are losing their island. Day after day, week after week, inexorably losing their home. On a property of the Chesapeake Bay foundation, and the last 25 years we have lost an entire pine forest, several dozen acres, several hundred trees to sealevel rise. I have submitted my testimony but let me just summarize briefly. The impact of Climate Change is multiple, but let me tell you about three for the chesapeake a. Bay. Warmer waters have a decreased potential to absorb oxygen. Tents temperature sensitive species are truly at risk. Second, the bay region is particularly vulnerable to sealevel rise, exacerbated by land subsided. Approximately one foot of net sealevel rise in the chesapeake over the last hundred years is roughly twice the world average. Thousands of acres of environmentally critical wetlands and shorelines have been and are now further threatened with inundation. And third, increased intensity and frequency of storms create more erosion and run off increasing the flow of pollutants, especially nitrogen, phosphorus, and sediment into the streams, rivers, and mainstem of the bay. Let me give you one very specific example. Of how global Climate Change and bay pollution are conspiring to possibly snatch defeat from the jaws of victory of one of our greatest success stories. Science said that the Chesapeake Bay rockfish, striped bass were a fully restored species. With pollution and increasing dead zones, the bottom waters of the bay or uninhabitable all too often for rockfish. And with increasing water temperatures, 75, 80 degrees and more, the upper levels of the bay or all too often uninhabitable for rockfish so they are literally getting squeezed and therefore stressed into a much narrower amount of the water column. To wrap up, lets instead of focusing on the problems, lets focus on the solutions. Addressing Climate Change, mitigating the impact of Climate Change, and implementing the clean water blueprint are more than just two sides the scene coin. Of the same coin. We need not only to save the bay but each will reinforce and add value to the other. One plus one can equal three. Thank you very much. Thank you. Doctor . Thank you on behalf of the union of concerned scientists. I think you i think you thank you for the ability to testify in front of an esteemed panel and interested audience. Im a senior climate scientist at ucs, the nations leading sciencebased nonprofit. We have over half a million supporters who are hoping that there are changes we are talking about today. As we all know, burning coal, oil, contact gas, and deforestation are increasing the concentration of carbon at unprecedented levels. It is warming the atmosphere acidifying the ocean, and as a result, marine life are facing multiple stresses. We have the ices diminishing many reasons many regions dealing with decreased snowpack. It is quite depressing. Sea level is what im going to focus on today because it has really accelerated. That combined with extreme precipitation are having an impact on severe flooding, which is part of the reason we are all gathered here today. So the pace and the amount of Greenhouse Gas emissions really determine how much worse things get. What does this mean for maryland . Parts of maryland are already facing the risk of lots of land loss of land. Everyone who cares about maryland should care about reducing emissions and cherished places like where we are right now. Today the capital, annapolis, is one of the most equally flooded cities on the east coast and as sealevel rise accelerates, the flooding will get exponentially worse. There are countless other communities up and down maryland and the eastern seaboard that are facing similar vulnerable risks. According to a recent ucs report which we call encouraging tied, the highest tides encroaching tides, the highest tides are causing more damage in some places are likely to be underwater in the lifetime of a typical 30 year mortgage. Recent trends help explain why this is happening. Over the last 50 years, sealevel rise has risen faster along much of the golf the east coast of the United States. The gulf and the east coast of the United States. The global rate is eight inches. To give an idea of the accelerating pace of sealevel rise and the consequences, if we stand our Current Business as usual, which is the highest trajectory of emissions annapolis would likely see another eight inches in just 15 years from now. And by just the lifetime of the Home Mortgage in 30 years, we could see roughly another 17 inches in annapolis. If we embark upon a low emissions scenario, annapolis could prepare for only about an additional three inches in 50 years and 16 in 15 years and six inches in 30 years. The dock is a Gathering Place that is central and it sees around 50 times a year flooding. Annapolis is projected to experience roughly 262 flooding events by the year 2030, and over 380 by the year 2045 if we stay on this high emissions trajectory. This means that likely have to days of the year will have flooding in annapolis. Other coastal communities and maryland are similarly vulnerable. Ocean city is highly vulnerable to storms and high tides, more so with sealevel rise. It occurs about eight times today. The city could face as much as 60 flood events by 2030 and a whopping 411 per year by 2045. These floods will be far more expensive extensive than the limited flooding seen today. If we limited Emissions Reductions to a lower pathway ocean city could prepare for around 42 flood events per year by 2045 instead of 411. Title floods will also be more severe interrelation. Title tidal floods today typically last an hour or less. The baltimore and its flood prone inner harbor are expected to be underwater for more than 875 hours per year, about 10 of the year, by year 2045 if we continue on the high emissions. Even when a hurricane forms naturally, conditions brought about why Climate Change are contributing to the power and destructive capacity of hurricanes in the north atlantic through more severe storm surges and more intense precipitation. To make matters worse, the latest science suggests that hurricanes typhoons are shifting more to the north which puts Midatlantic States more at risk. Resulting damage can be expected to worsen in the future as rising seas not only raise the frequency of flooding from regular high tide but also increase the height of storm surges. The u. S. And Global Community must start reducing emissions of heat trapping gases to avoid the worst impacts of Climate Change along our coast. The future welfare of coastal communities really depends on this. Thank you doctor. We will have questions from the congressman and move left from me. We wont try to limit it to five minutes from each of us. We do not actually have 8 mike is doing this manually. We are not hightech even though we are the hightech committee. I want to start with the admirable the admiral. You actually answered most of my questions. I would ask about what is happening at the academy and the horses offered there. I will not repeat that. Let me ask you can give some ideas of how this has caused the Naval Academy to repair the damage caused by severe storms or what you estimate the cost will be for some of the things you mentioned. V. Adm
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