Transcripts For CSPAN3 Key Capitol Hill Hearings 20150204

Our system, all of it was customized and developed in the 50s and 60s. Weve replaced that system with those expenditures. But we still have over 50 applications that need to be replaced. But to show what weve been able to do that, that refund app got 200 million hits last year. 150 million returns across just 85 are processed electronically. That was not only not possible, it was inconceivable 15 years ago. We have made substantial strides. But the 300 million on the Affordable Care act are all challenges for us. Fortunately, the Filing Season this year has been implemented. We have 145,000 foreign Financial Institutions about to provide us data under the foreign account Tax Compliance act. All of those systems had to be built and rebuilt to obama sosh that data. If we could continue with the refund the resources we needed, wed get rid of a lot of these systems. Taxpayers would be able to go on line, as they do with bank of america, wells fargo or fidelity and deal with us without paper, without calls. Theyd be able to do all of their transactions easily and efficiently. Were talkble about can i catch up with where Financial Institutions are. And to do that, we have to keep spending the money. I certainly would like to i know my time is up. Ill make this my last question. All of that is stoered in antiquated systems. Rather than having to hunt for the return. Right now, weve aut mated the return. Weve been investigating this since may, 2013. My staff has interviewed over 30 irs and treasury o fishls and reviewed over a million pages. Last year senator widen and i were almost ready to ask the committee to release the final report. However, right around that time, we learned that the irs did not produce all emails to and from the key figure in the investigation because of what the irs claimed was a failed hard drive. At that time, members of this committee will have ample opportunity to explore the irs matter in great detail. We will have to do this carefully because of the restrictions set by section 63 of the tax code which generally prohiblts specific information. I urge all members to save their questions on the investigation of irs organizationings. And, on that matter until theyve had a chance to review the final report. Senator, do you have any comments . Just very briefly, mr. Chairman and colleagues. This is the only bipartisan inquiry that has been conducted or is being conducted on this issue. I just want to emphasize as chairman hatch did in his statement that we are working very closely together and colleagues, we are committed to making sure that this will be the one bipartisan inquiry on this important topic. Thank you, senator. Senator casey . Mr. Chairman, thanks very much. Mr. Commissioner, grateful to have you here. Probably one of the toughest in this town. We can ask for reforms and change and Better Service we have to be willing to support the resources to get the irs there to get any other agency where they need to go. We estimate that the agency will lose about 1400 through attrition through fy 15 that were not able to replace. When you go down that list of cuts and consequences, one of the results of thoo is middle class families and very vulnerable folks out there have to navigate a complex system with a little help. So your challenges in the budget become probables down the road for middle class and for vulnerable families. So i support your efts to get the resources you need to be able to do your job. Its not good enough for us to just say theres a problem were not going to ask you to solve it. I want to ask you about the letter i sent a week ago last monday on the 26th. Regarding everything has an acronym, as we know. This is a tfop. The tax forts out let program where as many folks know free tax forms are sent out, in pennsylvania, were getting a high, high volume of calls and communication regarding the fact that because of the budget cuts the distribution is in Rural Communities. We have millions of people that live in rural areas. This is a big issue. So what Additional Resources or tools or support would allow you to maintain the past years level of service regarding these forms and instruction booklets. People havent relied on those forms. One of the things were trying to make clear to people and well get you the anxious before the week is out. Is that forms are are down loadble from our web siet. Everybody has access to the forms. We recognize not everybody has access to the internet. And the challenge for the library is many allow you to in fact, use their computers. Is that they could down load can down load those forms, but theres a cost to that. They have to run their printers and theyre running on tight budgets. So we dont underestimate the significant e kans of that problem. Overall, our concern has been as we try to figure out where to minimize the impact as much as we can weve historically set out large volumes of libraries and others as we track them only act 10 or 15 of the statements are huge. So were producing a huge volume of paper. Weve tried to therefore figure out what forms to use so we can produce those. But it is drektly a result of trying to avoid shutting the place down where can we cut costs . As much as we can. So its only a matter of a few myon to be able to produce all of that. Weve cut back over time as mart of our 200 million weve saved. Weve sent a copy of the instructions and returns. Nobody gets those anymore. And we save about 60 million a year because of those and other attempts to go forward. But we are anxious to work with libraries and others. We have no choice where we are this year to try to figure out what the right mix is for them so that they can have copies for people who need them and not burden the libraries with this kausz. As quickly as you can get an answer. Were getting a lot of calls on this. One of the problems is the irs gave an 800 number. They said were going to have this Problem Solved in 4 weeks, 5 weeks, 6 weeks. Its not enough time. Weve got something in the order of 20 Million People in if country, 14 of the total that dont file electronically. The faster you can get answers is better. The problem is in printing forms, the tax legislation that got passed late, so that throws our printing process out. And thats why by the end of this month well have available for people to be able to mail them and fwr my understanding the end of february, that seems like forever. Especially if people are trying to file refunds. But we will have those forms available and printed before the month is out. I will get you the answer to that later this week. There is a vote on the floor now. Were going to continue to hold this hearing during the vote. Id like to make sure all members are able to ask questions. Senator nelson, youre next. Almost 5 5 billion a year is going out as a result of criminals using somebody elses Social Security number you have a pilot study going on in three jurisdictions. Youre doing it in florida in larng part because ive raised a ruckus as a result of a lot of these criminals. Much to the annoyance and heart ache of the legitimate taxpayer. And, unless they can get that pin, personal Identification Number they can be the get the system to operate because the irs says oh, youve already filed a tax return. And they cant get their legitimate taxpayer return filed and their refund if they have one due. So i thank you for getting out those pin numbers next week. But in those three jux dictions since one of those jurisdictions is my state im going to apply for a permanent personal Identification Number and see how the system is. And i am filing this week legislation to set up a personal, permanent pin. Now, the next and most agree jous part of this is that a lot of these false tax returns are being filed by inmates in the prisons. In the federal prison system, as well as the states. We brought this to the attention of the ir zx a couple of years ago. You all implemented a and we passed, in law, that gaf you temporary authority of which you could then break your confidentiality and share with the prison systems the fact that someone had filed a false tax return and indeed, its an inmate. We then followed up that temporary authority with a Permanent Authority in law two years ago. But its yet to be implemented. Can you help us, please . Were working with state prison authorities. Its in theyre interest as well to find out whether prisoners are actually engaged in illegal action. And so the statutetorial support from the congress was critical to us. And it has already made a big impact which youre right we need now to have all the state prison authorities enter into the memorandums of understanding with us to go forward. So you had the memorandum in place with regard to the federal prison system . Yes the federal prison we exchanged data with them and thats been able to give us we know what the roles are like. We are there. Its really at the state level when we need state authority and state agreements. Then i want to utilize this hearing here today for the word to go out to the respective 51 prison systems. That if you want your folks to get mad just let them know that prisoners are filing false tax returns getting lots of money back and the state prison systems ought to get on the ball and sign this mem randing of understanding. And if i also want to use this hearing to encourage your people to get those mous when the state steps forward and wants an mou, get it done. I would like to correct one thing. Just because if you go online youll discover, we are actively pushing the Pilot Program in the three states, youll note. When you get an ip pib e pin, an Identity Protection pin, well give it to you fr one year. Its a permanent process. Each year youll get a new pin so that its because otherwise, were concerned that the pins will be stolen. So what it is is a way of updating every year. So when you get yours, some ways i know personally me, ive discovered its a very good program. The reason we havent launched it nationally is because we want to see how efficient it goes. We hope this year, as many people as possible in florida georgia and the District Of Columbia will sign up for ip pins. You just had another person sign up. Me. Beginning again in 2011, at the same time the irs began targeting 57ly cants. The irs gab gift tax audits and began makes contributions to various tax organizations. These audits are contrary to congressional policy and legal pres debit e dent when we got wind of this the irs stopped auditing these contributions. This is a very complicated area of the law. Would administer guidance to ensure that the audits would not be ramped up again. Its been about three years and weve yet to see any guidance or information. Its important to provide certainty to our citizens that the irs is no going to select gift tax assessments based on politics. So my question is when do you plan to provide guidance on these audits or would you be in favor of guidance codifying with respect to application of the gift tax to c 4rks and other tax kpecht organizations. It is in consideration were taking a look at it across the board because they are related to the whole question of the tax exempt status and organizations across the spectrum. But in response to your question, any Time Congress would like to legislate in this area, it would be fine with us. Its clear and easy for people to understand. So it is tied up with the entire question of okay, first, organizations across the board. I understand you want 67 million bucks more. Is that the number . Actually, the president s budget for this year would be our present buchblgt is 10 pbtbudget is 10. 9 billion. The president s request is 12. 9 through an integrity cap adjustment. According to senator balm and senator carton that were here they really want to use the money that you are not receiving now for 9,000 enforcement em poi yees . Weve lost 5,000. It would allow us to hire 3,00 employees in the Service Centers answering phone calls so our level of service would go back to 80. So this is phone calls. This not knocking on doors with regards to audits and so forth. Are you going to just aim at sophisticated rich people . I know some rich people that are not sophisticated. Everybody wants to talk about middle class class warfare. And the idea by my colleagues would focus on rich, whos rich . Is that 250,000 . Im thot worried about what you said. Im worryied about whether or not your words are feeling down. Particularly if theyre at the office of chief counsel. So what im going to do is not ask you to answer questions from me right now but i would like to raise with you questions and points about that program and submit them for answer in writing and give you an opportunity to give very complete answers. And i would just ask now for your commitment to provide complete and thorough response for the record on that issue whistle blower. Id be delighted to do that. Obviously, since those in the United States were undocumented are not legally allowed to work, it makes no sense to provide them a subs sill day tour. Current policy reflects this by requiring those claiming the eitc to provide a Social Security number for themselves, their spouse and any children. However, the irs chief counsel advice issued march of 2000 not now, 2000, suggests that individuals granted deferred action would be able to amend returns for the previous years to claim the eitc for years they worked illegally in the United States once they obtained Social Security numbers. So, mr. Commissioner, can you confirm that those granted deferred action will be eligible to benefit from the eitc for years in which they were wokking without papers in the United States once they obtained a once they obtain a Social Security number . Yes, if the way the Program Works is those without a Social Security number and there are thousands who file with it tins every year and people paying their taxes even though theyre not legally here, they are not eligible for the earned Income Tax Credit Program. Once you get a Social Security number, however, whatever the programs are then the Program Allows you to file for an earned Income Tax Credit Program in terms of whether you can do that retroactively, the normal statutes of limitations would apply as to when you can apply, file abamended return, in effect. Underneath all of that, you would have to file returns in the past now, im not going to argue what you said because i think you stated the way it is. But this is a problem you get into. The irs is an interpretation of the eligibility requirements undermines congressional policy of not rewarding those for working illegally in the United States. Does the irs have any intention of revisiting the 2000 chief counsel advice . At this point im not aware that were going to do that, but id be happy to get back to you. Im suggesting to you that it should be done because congressional policy is that ewe dont reward those who come here undocumented. So i would ask you to look at that and respond in writing. My last question will have to be in. Ive been investigating charitable hospitals that is suing its low Income Patients when they cant afford to pay for care as part of the tax exempt status. Charitable hospitals are required to offer a community benefit. What is the irs doing to meet hospitals that arent following their own policies when it comes to low income care . We take this issue seriously. As you know, weve had additional Regulatory Guidance for hopts as to how to meet their riemts, which are required. One of the hopes is streamlining for the 5013 c organizations. We make it much easier to qualify and give us more efficient use of our resources to audit at the back end. So that we think the points youve been raising are very important ones. These are, in many cases significant Financial Institutions that are tax exempt, to some extent, to e because they have a requirement to provide community sfszs. And its an important area for us to be aware of for hospitals to understand what their responsibleties are and tgs our responsibility across the entire tax code that weve taken up audits and enforcement activities to reenforce the need for compliance. Senator, youre next. Thank you, mr. Chairman. And thank you, commissioner, for being here. I was here for bart of your testimony and in response to questions. Youve got a tough job. They took some of the reforms of people on this side oeft aisle and that side of the aisle and i think were in a situation now where people are looking for a commitment by the irs to do a better job on a dozen things today. After that process i know that the image of the agency improved is a tough agency to love because its taking away your hardearned dollars. Im very concerned with what i hear. I think we do need the irs to figure out how to run more efficiently. Its before the internet was used as extensively as it is now. And one of my concerns has been a specific program that would help in terms of this budget issue that you have taurked about today. There is a decision made by your managers that has significantly raised cost for the inc. En sill. But also for taxpayers, its resulted in an additional 3470,000 calls your decision to shut down the authorization electronic account resolution applications. I would think with your manpower being stretch and your resours being stretched that you would not want to make a decision like that that would cost the agency so much and be harmful to taxpayers. My question is this type of internet based that the program provided something that you are intended to bet back involved with and are you going to implement it more effectively next time . Why did you shut it down . Youre going to reestablish those applications . Im happy to take a look at it. We dont have any flexibility left this year. I think this is an important area. We heard the same concerns. You have to understand were dealing with criminal as i understand syndicates here and around the world. We have almost 2,000 people put in jail. We are concerned overall about the practictioners. Our priority line is almost an oxymoron because it takes so long to get through. Theyre at the highest level of our concern. Whatever we can do the make the system work better for them, we will. We cant get the forms we used to get. I think there are certain things like the eservices program that will save you so much money over time. In terms of Identity Theft this is something i have strong concern about. Let me give you an example. We get call from a constituent, its a mom with a child. Shes claimed that the child on her filing, she finds out her child has been claimed. If were going to work that out with some of your folks but the Social Security number got into the wrong hands. Whats the agency doing to combat that type of Identity Theft . What options do we have to help you with that . If we can get w2s earlier that will help deal with some Identity Theft fraud. Well be able the see returns on childrens Social Security numbers are attractive to children because children arent filing a return and not claiming them on the return. Its an easy thing. There was nobody filing a return. We have filters designed to identify where those returns are coming from. We stopped about 15 million worth of fraudulent returns from going out last year. Rather than once a year which is where we were two or three years ago. This is a very important issue. Senator menendez has been patient. Thank you. I know the irs isnt the most Popular Agency of government. Its politically popular by some to take shots at you and your workers. At the end of the day the main purpose of the irs is to enforce the law and serve the american people. When we try to punish the irs as some do by cutting their budget its the american taxpayer that suffers the Collateral Damage through reduced service and efficiency. According to the National Taxpayers report to congress and ill quote from it, the budget viert environment of the last five years have brought about a devastating erosion of Taxpayer Service harming taxpayers. Report goes onto estimate that taxpayers will have to wait 30 minutes on hold before theyll be able to speak with someone and less than half of those calling in will be able to reach a representative. Less than half. Like you i think this is completely unacceptable. Not to mention that for all who pay hard and support our nation it allows those who cheat to get away to some degree when you dont have the ability to enforce the law. Let me ask you, is there any way to reduce wait times and increase Customer Service by reallocating resources to that critical purpose and if so, what would be the consequences of reprogramming funding away from other functions . Its a big part of our responsibility. Part of the limitation of saying turn everybody into answering the officers arent trained to deal with call center operations. We have critical investigators at the same time we have the people answering the phones and we have 2,000 fewer temporary people available for the phones. We only have 75 of our budget is people. Theyre spread across enforcement, operations, Taxpayer Service information technology. Theres no magic hidden pool that we can take that would move some people into Taxpayer Service that would go unnoticed. People who calling and trying to find out exactly how to abide by the law get information so they can be a responsible filer get delayed. Let me turn to another subject im concerned about is the Child Tax Credit. Its being criticized. While fraud in any tax program must be addressed focusing on one antipoverty tax program is threatening to deny an economic lifeline is not a solution. Theres a lot of talk about combatting fraud in the Child Tax Credit amongst low income immigrant families. I have a couple of questions you can answer. Is fraud in the ctc and atc a significant contributor to the 50 billion tax cap. It is not. Its not at the core of the tax cap. By what percent would the gap be narrow there was zero fraud in the ctc program . It might be familiarnarrowed by a percentage. Were very concerned about unscrupulous tax preparers. The vast majority do a good job. Do you believe its Fraud Prevention or a significant policy change that will deny this important credit to family. Obviously, wed love to move everybody off Social Security numbers. This juncture the issue of fraud is one that implies to i10s and people are forever stealing identification information from taxpayers to generate fraud. I find it interesting businesses under way taxes by approximately 122 billion in 2006 alone yet we dont seem to hear the same level of out rage in that regard. Wa thank you. Commissioner, i have one question. I think you want to correct something for the record in a discussion you had with senator nelson. Senator nelson focused on an Important Program which is our exchange of information with prisons. Were working on developing mous for states. Were able to cut down significantly on prisoner fraud but we dont have an mou as such with the bureau of prisons. Okay. I want to talk to you now about what i consider to be a decades worth of foot strategying at the agency. Im using that word having deliberately because its just not been possible to get some answers and get this resolved. There are some hedge funds that masquerade as insurance funds. The irs has been on this for over a decade. Theres responsible hedge funds who have offered suggestions on how to correct this. Every time i bring it up, you all say its the treasuries doing, theyre not getting at it. Im going to bulldog this until this is resolved. I think this is outrageous. Go back and forth between you and the treasury as i have just unacceptable. These are people that are taking advantage of the lawabiding taxpayers that we talk about. What is it going to take to get this resolved . We have prepared guidance and are working with treasury on putting this in final form. Within that context we ought to be able to move this forward. Were committed to doing that. Were working with treasury to get those regulations out. Guidance was issued in 2003. When do you think this is actually going to get accomplished. Can you give me a date this morning . Otherwise it sounds like more of the same. More of what everybodys talking about since 2003. Were talking to our colleagues. Theyre going back and forth. Yes theyre legitimate hedge fund companies. Give me a date when i can expect this will be completed. As you know i dont control that. The regulartions come out of both agencies. 90 days . Can i expect this will get done in 90 days . 90 days has a nice ring to it. Lets get it done in 90 days. After ten years ten years plus 90 days seems to be enough time. Thank you. Thank you for your patience here. We appreciate you coming to the committee and being open to all these questions that have been asked you have. Let me just say a couple of things. I have a couple of questions. The president indicated he would be for corporate Business Tax Reform. Has anybody in the administration contacted you about how you think that ought to occur . Have they contacted you or talked to you about it . Im not aware of any contact about that. We have with an ongoing set of reviews with the Treasury Office about regulatory device and development of programs. As such, were anxious to cooperate with anything thinking about tax reform it has to be administrative. They consulted with you about these tax proposals that the president is making. We dont have communications with the white house. Why not . It seems you know more about it than they do. For all the reasons we have talked about over the last year and a half were involved in Tax Administration and discussion about tax policy at the higher level of policy levels not the drafting of the statues were not consulted. As you move forward, whatever the policy is that people are considering it has to be administered. Anybody looking at reform or simplification of the code. We appreciate you being here today. Its been a good hearing, in my opinion. Any questions for the record shall be submitted no later than tuesday, february 10th. With that the committee will go into remission until further notice. Thank you. Appreciate you being here. On the next washington journal, congressman gene green, democrat of it can on the gop efforts to repeal the Affordable Care act. Later, cspans tour of black colleges and universitys kicks off at Howard University in d. C. Our guest will be dr. Wayne frederick. You can join the conversation with your calls and comments on facebook and twitter. Keep track of the Republican Led Congress and follow its members through session. James chairs the Senate Environment and public works committee. This is 2 15. Meeting will come to order. The whole right side back there is oklahoma. I came in last night and they were having a dinner. I thought two or three people. I knew gary ridley would be there. Hes always there. I looked over and all familiar faces there. We have this concern theres a lot of things about is government really spoedsupposed to be doing. And quite often the reason i got on the committees i did 20 years ago, was because this is what were supposed to be doing, defending america, building infrastructure. Thats it. So we all understand that in oklahoma. We know that we have gone through a process that most of us some of us remember, most of us have not been around that long, but i do rare over in the house on the t. I committee, at that time, sfm commissioners foxx, you know the problem we had then . Too much surplus. We all know what happened since that time, and we all know we cant continue to do as we have done in the past. I think i do have an opening statement, which i will submit as part of the record. I think the significance of this meeting, i say to my friends on the left and right, is that we want to do it right this time. Weve done patchwork, put together things we think are a good idea, and i have to say this, weve had successes. I didnt like the way things went back in the 27month bill we had. I didnt like the idea that a lot of republicans, my good friends were demagogging it, and not realizing that what they were doing they were thinking they were doing the conservative thing, but its not. The conservative thing is to pass a bill instead of having the extensions. Secretary foxx has been out in oklahoma and weve talked about this at length, the cost of extensions. I think its somewhere around 30 off the top. Well, the good in us is that the house, when we went over right after this bill, and told them, talked to them about this thing, about our constitutional responsibilities, every one of the 33 republicans and the democrats on the house t i committee voted for it. That was a major breakthrough at that time, and i see that happening again here. We are going to be doing the right thing now, and as we know we decided to do, that were going to make one change in this committee. Were not going to have everyone with opening statements, because we have numerous witnesses in. I will just yield to senator boxer, and then we will start continue the hearing. Mr. Chairman, thank you so much for making this your first hearing. Nothing could please us more, because we know this is an area that there is bipartisan support for, and i think senator vitter and i its no big secret we dont see eye to eye on much, but we were able to get a good bill done through this committee,and i have to make a point, mr. Chairman, we were the only committee to act last congress. No committee of the senate or the house, but this committee. With your leadership were going to be working together here to get this done. Im going to ask unanimous consent to put my statement in the record and make four very brief points. First, we can do nothing more important for jobs, for businesses, for this economy, for this middle class than passing a multiyear highway bill. Thats the first point. Theres Nothing Better that we could do. Secondly, we have a great record of bipartisanship on that issue, so nothing should stop us. Again, i point to last year, when we acted when no other committee acted in the senate or the house. There was bipartisan paralysis except for us in this committee. And im so proud of that. And we need to take the leadership again and hopefully this time it will be emulated. Three, we have to have the courage in the senate and in the house to find a multi to fund a multiyear bill. We cannot leap over that idea to an extension and that leads me to my next point. We are getting perilously close to the bankruptcy of the highway fund, may 21st. Rhetorically i ask if you to the bank and want to buy a house and the bank says, great, well lend you the money, but only for five months. Youre going to walk away. You wont buy a house if you know that many thats what theyve done here. When i say they, the vast majority of our colleagues. Punted this, and this is awful. This is the greatest country in the world. We will not remain so if our bridges are falling down, if our highways are crumbling, and so many other ramifications of not investing. So we need certainty. Today i learned from my staff, i dont know if your staff has informed you, that the deficit in the trust fund is less than we thought it will be. We are anticipating 18 billion a year over six year. Its 13 billion a year over six years. I thought it was 15. Now its a lot less than we thought it would be. 13 billion a year. If we cant find that, thats a 1. 2 trillion budget on discretionary spending. If we cant find that to build the infrastructure we have failed as a congress. So with your leadership and with all your strong support from oklahoma, i think were going to get things done here. And i look forward to it. Thank you. Its my honor to introduce and present not really introduce secretary foxx. Hes been a great secretary. Its been a difficult job. Weve had a chance to break ground on a lot of great things, so im thankful that youre doing what youre doing, and youll be in on the big kill, and were going to do it together. Secretary foxx. Thank you very much, mr. Chairman, for your kind words and for your leadership as well as the leadership of Ranking Member senator barbara boxer. The work you have all done and will continue to do is vitally important. I want to tell you that we appreciate your service. I also want to thank the entire committee here. We are in a new year with a new congress, but im here to discuss an old issue as has been celt a multiyear transportation bill with funding growth and policy reforms, focused on americas future. America is in a race, not jest against our global competitors, but against the high stids of innovation and progress our nation has shown for generations. We are behind in that race. When youre behind, you must run faster and do more than just keep pace. The Transportation System itself does not care about the political challenges of addressing its needs. From its perspective and from mine, we are either meeting those needs or we arent. In the past year, ive been to 41 states and over 100 cities. Mr. Chairman, you were kind enough to invite me to oklahoma, where we saw a stretch of i44 just south of tulsa that needs to be widened, but the funds just arent there. There are thousands of miles of highway projects in oklahoma that the d. O. T. Has said are critical, but theyre either not being built or theyre not being repaired. Unfortunately, oklahoma is not alone. Ive also visited the bridge that connects kentucky and ohio. Its carrying more than twice the traffic testify designed for. Chunks of concrete are now falling from the bridges ramps on cars parked below. It must be replaced, but theres no real plan right now on how to pay for it. Or you can look at tennessee, the state d. O. T. There has postponed 400 million in projects, and the thousands of jobs that come with them, because of quote unquote funding uncertainty here in washington. Now, tennessee is not the only state to slow or stop projects, but it may be the first state to tell the unvarnished trust about whats happening to our Transportation System, about how gridlock in washington is now creating gridlock on main street. Last year we sent you a comprehensive multiyear proposal, the grow america act, which included 350 pages of precise policy prescriptions and substantial funding growth, all focused on the future. What america received in response was a tenmonth extension with flat funding, which while averting a catastrophe, falls short of meeting the countrys needs. It was not the first shortterm measure or patch that has been passed. It was, by my count, the 32nd in the last six years. And as a former mayor, i can tell you that these shortterm measures are doing to communities across america what the state d. O. T. Says theyre doing in tennessee dish literally killing their will to build. At this point we must concern ourselves not only with the immediate situation that confronts us, but with the cumulative effects of these shortterm measures. I urge you to make a hard pill volt in and out, from the Rearview Mirror to the front windshield. Look at ouring system. Look at the opportunity we have to grow jobs and the economy. Look at our own children and grandchildren. In order for the system to be as good as the american people, we must do something dramatic. To hell with the politics. Thats why we sent you the grow america act last year and why we will send you a new and improved grow america act this year. We certainly know that the grow america act is not the only approach to solving the infrastructure and mobility challenges of the future. We look forward to fully engaging this committee with and with others on both sides of the aisle to chart this path together, but we believe there are some essential principles that any bill must have. First, were going to need a substantially greater investment. Were also going to need a larger not just if we want communities to build big projects that in some cases can take five years or more, we need to ensure funding for roughly that amount of time. I think senator boxers analogy with trying to buy a house with fivemonth loan is a great analogy. We believe we can do that while assure Better Outcomes for the environment. We also believe in opening the door to more private investment and in giving communities and npos, freight operators, a louder voice in what gets built. We believe in strengthen our buy America Program to make sure tax dollars are being invested in american project built by american hands with american products. And we believe we must do everybody possible to keep americans safe. That includes obtaining the resource and authority that we need to combat threats we might not expect in this new century. In the end my entire department has Great Respect for what the committee has done and the challenge ahead. Looking forward, a huge achievement, and now it is time to build on that work. When i was sworn in, i took the same oath that you did, to protect and defend. For me that means protecting and defending americans fundamental ability to move, to get to work, to get to school, to get goods from the factory to the shelf. But i cant do that. They could do that, and we cant do that unless we take bold action now. Im here to work with you, and im also looking forward to your questions. Thank you very much. Thank you, mr. Secretary. Ive often thought in that particular job, in your job theres no better background than to have been a mayor of a large city. You and i have talked about that in the past. When you see the things that you know are that you know that work s. You wonder sometimes, how can we build on these, because i know the press whether we walk out of here, the only thing they want to talk about is how do you pay for it . And we dont know yet. Were going to work on it. But there are some areas that are sometimes controversial, and i have to appreciate both sides working together on some of these enhancements. Weve doth done a lot of good things. What more is out there thats obvious to you, that could make it go faster, and yet get off the ground quicker . Thank you, mr. Chairman. Its a very important question. We do have experience in the recent past building on some of the work of map 21, of doing concurrent reviews in the permitting process, which effectively allows all of the federal agencies to sit at the table at the same time in the earlier point of design and construction of a project to comment on that project at a point at which the project can still be changed to respond to the permitting. Theres a project in new york called the tappency bridge. We were able to reduce the permitting time from what could have been three to five years to 18 months as a result of doing that concurrent process. We do bled theres an opportunity its really a direct result of the changes that we made in coming to this point . It was building on a lot of the work that map 21 contained, and there was also some administrative work that went into putting that on dashboard and assuring the agencies worked together. But we think there are additional tools that could be provided to enable that to happen more. The good news there is that when you do concurrence reviews, youre not sacrificing it is environment. Youre actually putting the environment at an earlier stage and actually Getting Better results there, too. Thats right. Senator boxer . Thanks, mr. Chairman. Mr. Secretary im going to press you on whats happening on the ground, because we have failed as a government to give any certainty to this process. So we know that tennessee and arkansas have already delayed hundreds of millions of dollars in highway projects for this year, and last summer over two dozens states had taken similar preemptive action, as the Highway Trust Fund neared insolvency, this whole game of waiting, and then somebody steps up in the house or senate and said im going to save this for five months. This is a disaster. And can you discuss the likelihood that were going to see these cutbacks continue if we dont take action soon to shore up the trust fund . Thank you for the question. This is a crisis that is actually worse than i think most people realize. Your point is very well taken. We have a may 31st 2015 point at which the funding of the tenmonth extension runs out, but the state departments of transportation are having to figure out what their plan of work is going to be during the height of construction season, which starts right about the same time that the extension runs out. So i predict that over the course of the next few months youre going to see more state departments of transportation start to slow or stop projects, because they dont know whats on the other side of may 31st. So from a timing perspective, i think we have a problem sooner than may 31st in terms of the situation on the ground. I think youll see states pulling back even before may. Thats basically my question. Im not going to take any more time. The one point im going to make over and over again to anyone who will listen, and some will and some wont, is this is our duty, this is our job, this is the best thing we can do for the country. This is the most bipartisan thing we can do, and this committee im urging, and i know the chairman feels as i do, that we need to step out here. I would say to colleagues here, we have a really great role to play by stepping out again and doing the right thing. We have the blueprint that senator vitter and i put together with all of your help. That may not be the exact blueprint we go with, but its a definite start. So thank you for in your very calm and collected manner, for letting us know that lack of action is already happening, and having a result and impact on the ground. The impact is bad. Its bad for businesses, its bad for jobs, its bad for communities, for our local people, and thats the point i think i wanted to make, and you made it very eloquently. Thank you, mr. Chairman. Thank you senator boxer. Senator vitter . Thank you, mr. Chairman. I want to echo the comments that having made about the bipartisan work of this committee on infrastructure. Last congress this committee on a completely bipartisan basis produced a really good Water Resources bill, Water Infrastructure bill that was very important for our ports and waterways, and that infrastructure, maritime, commerce, and as senator boxer mentioned, we put together a very good highway bill in this committee. Now, we have an easy part, quite frankly, so i dont want to overstate it. We put together the transportation part of the highway bill, good bill, very bipartisan basis, but the Financial Committee has the hard part, which is the financing part. And i want to cut right to that. So lets cut to the chase. I agree, we need to get this done, we need to get it done on a medium to longterm basis, not another bandaid approach. My suggestion for all of us who truly want to do that is to cut right to the chase, and to really dive into those discussions about low we finance it in a realistic way. Folks on the left, including the Administration May have ideas that are perfectly valid ideas that just objectively are going nowhere in this congress. Folks on the right in this congress may have ideas that are perfectly valid ideas that are going nowhere with this administration. My suggestion is we blow past that, dont waste time, and cut to the chase of where we may find a common solution. I believe realistically there are three realistic categories to focus on. One is a traditional gas tax, a traditional means of financing the Highway Trust Fund. I believe that is only realistic, only a possibility, in my opinion and this is just my political judgment, you cant prove this, but i think its only a possibility if we give all middle class and lower middle class taxpayers a tax offset. Something off their income tax, withholding, something, so they are held harmless, so they do not pay a higher federal overall tax bill. Second big category, i believe, is tax reform, maybe focusing on Business Tax Reform, and using elements of that, namely repatriation, that is not a truly permanent solution, but those are big dollars that could fund a significant bill of a significant duration. And then the third big category is some Domestic Energy production with the additional royalty and revenue dedicated to the Highway Trust Fund. Now, i would like to see that to a much greater extent that im sure is realistic, given the sensibilities of folks on the other side of the aisle and the administration. So in the spirit i began with, im not suggesting, i know David Vitters lease plan for the ocs, which is a great one, by the way, but im suggesting some expanded production, which is good for American Energy independence, good for our economy, and would produce significant new revenue, at least when the price of oil gets to a better place, more stable place that could be dedicated to the Highway Trust Fund. So my question is whats the administration doing to cut to the chase, as i said, and explore those three cad goirs . Categories . Let me answer the question directly and also make a point the administration has put forward a proposal to use progrowth Business Tax Reform to pay for our infrastructure, and what we would basically do is put in addition to what the gas tax is currently spinning off, of course its less than what the Highway Trust Fund needs to be level, but we put another amount of a like amount into our infrastructure to not only replenish the Highway Trust Fund, but to do more than that, which leads me to the point that i want to make, which is that i think there needs to be a conversation about what this is. What number are we trying to get to . And what is it going to get us . If you think about me and our department as contractors, we can try to go out and build what Congress Urges us to do, but i want to make it very clear we could go out and build a great big mansion if we have the resources to build a hut. I think that our system really needs a substantial injection, the longterm bill, but also substantial growth to counteract the cumulative effect of the shortterm measures in the recent past. I want to follow up specifically on that point, is there a version of that proposal youre talking about that doesnt have the big tax increase on successful folks as part of it . Because going back to the spirit of my comments, im suggesting that, you know, we get real and cut to the chase so we actually solve this in a meaningful way by may. If were just talking about that version, in all due respect, i dont think thats meeting my test. The green book last year published three specific ideas. One was eliminating lifo. And a second one was depreciation. And a third one was pulling some of the untaxed corporate earnings overseas, and brings those back home. And those three ideas very specific ideas are ones that seem to be within the parameter that you have mentioned. Let me also extend to you, senator, to the committee and to the entire senate and house the full measure of my attention to help you get to yes on a solution here, because i think it is vital for the country. Thank you, senator vitter. Senator . All right. Senator cardin . Thank you, mr. Chairman. I appreciate that. Secretary foxx, thank you for your work. I strongly support a robust reauthorization long term of our transportation needs, needs to be long term, as has been pointed out our states and counties cannot plan without the longterm commitments from the federal government as their partner. It needs to be robust, because its not only the new roads and bridges and transit systems that we need, but also maintaining the infrastructure that we have. So we have to focus on this. I do want to maintain, and i think this is an important part, the flexibility. I represent maryland, the bald more, Washington Area is the most congested area in the nation. We need to invest in transit, and we have a game plan to do that. We want to stay on that game plan, but a large part of it depends upon the ability of a sustained federal partner, and that requires a longterm reauthorization of a robust bill. I also want to emphasize the need for giving our local governments flexibility. Ive worked with senator cochran on the transportation alternative programs that allow locals to make decisions, our mayors, our county people to make decisions, as to whats in their best interests so we have livable communities, where you can walk and bike and keep cars off the roads when theyre not necessary. Then you emphasize safety. I just want to emphasize that point also. We had a tragic bike accident in baltimore just recently. Its critically important that our local governments have the ability to keep their people safe. We recently have another tragedy on the metro system here in washington, and weve been working with and your staff to make sure that we find out as soon as possible how we can make the metro system safe. In other words, that we dont wait a year for the full review before we. And we want to have the resources to modern id our Transportation Systems. I i had the honor of living in baltimore and commuting to washington every day, and never know whether its going to take me one hour or three hours to get in. So its its a challenge for people in our regions, challenge for people in our country, and i just urge you to be bold. I think this committee is prepared to be bold. It seems to me the price of energy today, we should be able to to get the resources we need, in order to do what youre constituents want us to do, have a modern Transportation System, be able to maintain that, and create the economic engine that will create jobs for the people of our community. Thats our goal. Thats what were trying to do. I just want you to know that we appreciate your commitment to this. You have a lot of partners on this committee. Thank you, mr. Chairman. Thank you. Senator fisher . Thank you, mr. Secretary, for being here today. I appreciate it. If your testimony you state, quote, too often projects undergo unnecessarily lengthy reviews and we need to make the types of reforming that will exceedate highpriority projects and identify best practices to guide future efforts. I couldnt agree with you more. As you know in nebraska, our department of roads, or cities, our counties, they have been very frustrated with the federal Highway Administrations what i would call unpredictable approach to the Environmental Review process. You know that we have been trying to work on that. I dont believe that it comports with the performance base, datadriven approach of map 21. I think they need those those reviews need to be performance oriented, not solely processed based, and certainly not inflexible. I appreciated your earlier comment about a concurrent review process, where you can cut it down from 3 to 5 years to 18 months, that would be great. That would be great if we can do that. I hope that the federal Highway Administration is going to tip to work with nebraska so we can get there. As you know limited resources become even more stretched and stressed when we have a process that i believe is not working the way its supposed to. What do you think we can do to be sure that that state of good repair projects within existing. Reporter right of ways are with regulatory agencies. Whats the value added to Environmental Protection by conducting even a celevel review on a resurfacing project, or another project in an existing right of way, where transportation facility already exists. Do we have to study and documents things over and over again that would be great. That would be great if we can do that, and i hope that the federal Highway Administration is going to continue to work with nebraska so we can get there. As you know, limited resources become even more stretched and stressed when we have a process that i believe is not working the way its supposed to. What do you think we can do to be assured that that state of good repair projects within existing rightaways are exempt from what i would call a counterproductive consultation with regulatory agencies and whats the value added to Environmental Protection by conducting even a celevel review on a resurfacing project or any project in an insisting right away. I want to emphasize that i think that through a new bill congress could give us additional tools to enable us to operationalize con current views. I think you get better environmental outcomes. Doing it that way because the environmental considerations get brought up early and dealt with early. I would be very happy to work with you on those with my Office Especially so we can stop the redundancy that i believe is happening. If we can move on to tiger grants, do you think youre being distributed in an equal manner. I know that when we look at Rural America, open country, small towns. It seems that were not getting really tiger funds in those areas. Can you tell me why that would be . Well, a couple of points. The Tiger Program requires a minimum of 20 of each round to be distributed into Rural America. And the definition of Rural America at that point is . I would have to have my staff confirm this, but i believe it is a community of 50,000 or fewer people. Im talking about very sparsely Populated Areas where in many cases theres one person per square mile, but yet in a state like nebraska we have miles and miles of roads that are necessary for commerce, for safety and i would think we could look at a new definition of Rural America. You know, were following the statutory definition, but if there is a new definition we will follow what this Congress Tells us, but what i would also say are a couple of other points. We in the last round exceeded that 20 minimum. We think of it as a floor, but not a ceiling and we are looking constantly to make sure that we see good transformational projects across the country wherever they happen to come from. Secondly, we have done more outreach to extend Technical Assistance to Rural Communities because in some cases it is the communities that have fewer tools and help prepare their applications that sometimes dont get through and so we want to make sure were as equitable as possible from that standpoint so we will continue to work with you and others and i will continue to applause nebraska for the tiger grant that last round for the Rapid Transit system, the very first in the state of nebraska. It was great. Thank you very much, mr. Secretary. I appreciate your work. Thank you very much, mr. Booker. Thank you, mr. Chairman. First and foremost i want to echo some of whats already been said. You are an extraordinary Public Servant and one of the best cabinet members that the president has and im also your friend for many years and former fellow mayor, and i want to thank you also for your numerous trips to the state of new jersey and for your partnership on a number of very specific important projects. As you know, new jersey is the most densely populated state in america. Its home to the most valuable freight quarter in this country. Its home to the busiest airspace in this country and has the third busiest sea port in the United States. We have 39,000 miles of public roads and 6,500 bridges and nearly 1,000 miles of freight rail. In many ways, when it comes to the Economic Prosperity of our state, new jersey is a transportation hub that really drives our economy, and i dont want to restate anything that has been said already in terms of the importance of moving a longterm funding mechanism forward, first and foremost, delays in adequately funding our infrastructure actually costs the taxpayer more money. In other words, it will drive the expense of this transportation deficit even higher. So in other words, all of the fiscal conservatives in that and i include myself having been a mayor and you, as well having to be fiscally conservative and we are delayed in our lack of funding and our shortterm actions actually are driving more cost to taxpayers over the long run, is that correct . Yeah. Absolutely. We have estimates, the American Society of Civil Engineers estimates on a state by state basis the cost of poor infrastructure on our roadways and in most cases the amount people are actually paying into the Highway Trust Fund, for instance is less than the cost theyre experiencing as a result of poor Road Conditions whether it be having to buy new tires or get a new axle fixed or the cost of gasoline or whatever. Folks are paying more than what theyre getting. It is the height of responsible from the dollars and cents Balance Sheet analysis for us to do nothing or shortterm fixes, not just for the public treasury, but as you said already, motorists in my state on some estimates are spending over 2,000 a year because of poor Road Conditions. So our inaction makes people pay twice. Once with the taxpayer dollars and also with their own dollars out of their own pocket for direct payments because of repairs to their cars, congestion, lost productivity because youre sitting in traffic. So really, our inaction in congress is making people pay twice. Yes. Money is one thing, but time is something none of us can create more of. When folks are spending 40 hours on average more a year in traffic thats time they dont get back. Thats a soccer game or a work hour or whatever, and i think that we have just we as a country have stopped thinking about our Transportation System as something that gets us there fast. I know the importance of finding the mechanism is really important and its almost like saying we either pay now or we pay much more later, and so the last thing i want to ask you to comment is one of my colleagues did something that many people might think is radical. Senator sanders called for a trillion dollar investment and far more than what the administration is asking for. Did you give your opinion on that and knowing that it is far more than a trillion dollars and how do you view senator sanders, a call for the trilliondollar investment. Its a bold step. Its a bold step and a statement about where we are as a country. We need to invest more, and i think everyone strains to figure out how to pay for it, but to your further point, what happens if we dont. Were going to pay probably more anyway on an individual basis and well lose opportunities to bring jobs to this country. For every billion dollars we invest we estimate 13,000 jobs come as a result of it and in the transportation sector at large, only about 12 of folks that work in transportation have transportation have college degrees. So you look at that versus the long term unemployed this is also a jobs issue. So were not capturing opportunities as a country because were not investing as we should so i think its very important and i applaud senator sanders for taking a bold step and talking about the needs we actually have. Thank you mr. Secretary. Thank you mr. Chairman. Thank you senator booker. It gives me an honor to introduce the senator for the first time in this committee. Shell make great contributions here. Thank you mr. Chairman. Thank you secretary for being here with us today. I was able to meet you first when i was over on the Transportation Committee on the house side. And i was also on the Conference Committee with Ranking Member when we did a lot of the streamlining of the environmental permitting for projects and im glad to know its moving along. I understand theres things still yet to be done so i appreciate that effort. You know, also, i would tell my colleague senator fisher that West Virginia Rural Community town was a recipient of two tiger grants for Economic Investment and were very appreciative to that. Theyve been very innovative with that and i think its really going to grow that local and regional economy so i am very appreciative of the set aside for Rural America because we were the beneficiary of that. You know the big question is how do we afford all of this and what were all trying to struggle with. So i would ask you in the private private Public Partnership arena. Are you finding across the country that states and local communities and business entries are really stepping up for this private Public Partnership. We see some of this stuff in West Virginia. I wonder how some of this stuff is going nationally because i notice in your written kmemtcomments you talk about expanding the tifia opportunities. Thank you very much. We do see a lot of promise in Public Private part shernershippartnerships. Theres some really clear examples in the last few months of ones that weve been able to move forward. One of which comes to mind is in pennsylvania where there were 500 some odd bridges that the state of pennsylvania needed to update. Many of them were deficient. And not one of those bridges by itself would have necessarily attracted private capital but they pooled those bridge projects together and we were able to issue, i think it was 1. 2 billion in private activity bonds to support getting all of those bridges done. So were looking at creative ways to move forward. Having said that i think weve got some problems. I want to be very clear about. Number one this issue of the cumulative affect of short term measures, has hurt us as a country because its hurt our planning process. States and local governments in a havent had the luxury of counting on federal support over a long term period have pulled back on their planning. And so the big projects that are most likely to attract large scale private capital in many cases arent actually being planned. They are not going through the review process. They are not teed up, if you will to rapidly move into a Public Private partnership. The second challenge we have is the programs we have within usdot are relatively stove piped. Tifia works through some agencies within dot but not all. Riff works through the federal rail administration. Pabs works through our office of policy. We think one of the things that additional policy could do is to help us pool those resources together so that we can have a deaddicated team to really focus on private Public Partnerships. Thank you for that. I share your freftustration certainly in West Virginia, theres a lot of frustration at the local and state level about the inact for us to do a long term highway bill. Im certainly committed to that. I think where the frustration for a state like ours falls is because the money comes in smaller chunks, you end up really just doing maintenance. You dont do anything innovative. You dont do anything that really is telling your population that were moving to the next century and so we see that in our home state. I think thats very frustrating to local citizens, businesses and people who are trying to grow the economy at the same time so i share that frustration. So i would join with you to try to make this work and to find the magic formula that we can give the confidence to the states and local folks that we really can get this done. I think theres a great impetus for this. And i look forward to working with you. Thank you. Thank you senator. Senator marquee. Thank you mr. Chairman congratulations to you on this first and most important hearing that we will be discussing and i know that you and the Ranking Member boxer are working very closely together to advance on this legislation and i think that if we do it correctly we can have a Great Success this year and i thank you for your work on it. Mr. Secretary, if i may, id like to talk first of all, transit oriented development. You came up to the rugal station in boston. Yes. And were having Great Success there with the help of the federal government to encourage development in an area that historically has been under served but is potentially could be explosive in terms of the growth and the use of Public Transportation. Could you talk a little bit about that and the role that the congress can play in partnership with the department of transportation to continue to advance it and what role do you see that in terms of it being built into the legislation that were considering. Well thank you very much. Its a very exciting project in boston. You know, whats happening in boston and across many of the metro areas around the country is population is starting to concentrate there. If you go to some cities i was with mayor garcetti in los angeles actually and he mentioned to me that they literally dont have more highways that they can build. They need to integrate Transit Choices into what they do. When you build a station like rugals what that does is it captures the imagination of Real Estate Developers and they start to build dense developments and bring amunities into communities that might not traditionally have them. I think the challenge for us is right now if you look at amount of money were putting in to transit, i think the demand for it will increase substantially over the next several years because of shared population movements. Thats one of the reasons why i would urge a more robust investment in transiptt first of all and secondly, urge that we do more to partner with local communities whether its npos or mayors or even governors in some cases to help them develop the tools to utilize the land use countries that come about as a result. Yeah. You know, boston had 800,000 people who lived there in 1950 and drifted all the way down to about 600,000. But now with increasing transit oriented development, boston has gone back up to 640,000 and the arrow is stit upraight up in the terms of the number of people who want to use Public Transportation live closer to all the amenityies of the city but also the jobs that are being created around this transit project which has reduced the number of vehicle miles driven by automobiles all across the country over the last five to six years, its just going down and down because people want to live and work closer to their mode of transportation and increasingly, its Public Transportation so thank you for all of your work on that. Could i talk with you a little bit about the complete Streets Program as well . Sure. That i also find to be very, very exciting where pedestrians bikers, children seniors. Everyone is included in kind of a project approach that insures that all of these facilities can be used by everyone. Can you talk a little bit about that and again, the role that congress can play in the authorization in partnership with the department of education. Through our Transportation Alternatives Program weve been able to be a bit of a catalyst in helping communities develop best practices around the greater use of complete street its. What that really means is creating ways in which all users on a roadway to safely use those facilities so youll have a lane for vehicular traffic, youll have places for pedestrians that are safe and bicyclists as well. We found that it not only helps with safety but people actually use the entire roadway in different ways. Its healthier its cleaner in some cases. I think that continuing to support the Transportation Alternatives Program and helping us build additional tools to support states as they measure safety of bicyclists and pedestrians and bring it up to a standard that we expect of every motor transportation. Yeah. So right now were seeing that upwards of 3 4th of children killed are killed in urban neighborhoods the more we can reduce the numbers and make the streets safe for everyone, i think the better off were going to be and i am looking forward to working with you. I think its a very exciting way and by the way, i think youre just doing a fantastic job. I think you understand cities having been a mayor and i appreciate all the work that you do. Thank you. Thank you senator. Thank you. We will recognize now senator rounds for his first introduction to this committee and how delighted we are to have him serving on the committee. Thank you mr. Chairman. Mr. Secretary, thanks for the opportunity to visit with you just a little bit today. Coming from south dakota it strikes me that in our home state, were between 800 and 9 900,000 accept during the time of the Sturgis Rally and then we bump up considerably. It seems like as a former mayor of boston the discussion there in terms of youve had the opportunity to work on transportation projects from a different point of view. A large metro political area and yet one in which youre dealing with the federal guidelines and rules that are required in order to qualify for federal funding. In south dakota dakota we have similar challenges but on an agricultural basis and a rural basis. Just curious as to your thoughts with regards to the projects that as youve indicated earlier in your statements and so forth that they need to be modernized. And we have to be more efficient if were going to expect tax payers to put more dollars in at some point in the future. How do you move forward from the federal side now when youre working with communities large and small states large and small, differing expectations in terms of the quality and yet at the same time, the need for modernization of different projects. What do we do to convince and gain the confidence of the individual tax payers who look at a federal operation here that under traditional operations take a huge amount of time just to get a project ready to go approved and then actually built. What do we do to convince them that we have modern ways and more efficient ways to actually deliver those probablingjects in a timely basis. Have you gotten ideas. Would you share with us a little bit in terms of your thoughts of what we can do to actually deliver a simple way of saying it more bang for your buck when it comes to the dollars that were going to be expected to invest in order to maintain the infrastructure today. Sure. Weve had some conversation already about project delivery and things that can be do to improve it. And theres another idea that i havent mentioned that i think is worthy but essentially, i think we can greatly accelerate the delivery of projects speeding them up in other words by having more concurrent reviews occurring at the federal level. I would also urge creating tools that incentivize the states to do the same thing because sometimes the delays that occur are not just federal delays sometimes they are state reviews that have to take additional time and giving the states more tools to be able to accelerate is also useful. In addition to that, theres a quarky thing in the federal government when it comes to multiprojects, ones that involve potentially highways or rail or transit and that is that the reviews are sometimes they require separate reviews so even within our own department on a project that has different modes involved sometimes we have to have two different sets of reviews occur and it doesnt make sense to me that we do that. With you its a requirement that comes that i think could be fixed by legislation. So i think cleaning some of that up would be useful and it would also allow us to move forward without compromising the environment and ensuring project integrity. The other thing i would say though is that i think the public has gotten used to a deteriorating system. And i would urge that if you give us the tools to help speed up projects which i would urge in the way that i just discussed, that we also look hard at making sure that we have the resources to make the kind of impact on folks commutes and their ability to get goods from farm to market or whatever and make sure that this counts. If youre going to go through the brain damage or trying to figure out how to get this done make it count for america and make it so that people actually see it and feel it because i think another part of the bang for the buck issue is that if we are essentially mabnaging a declining system folks are also going to lose confidence even if we speed up projects. Secretary thank you. Thank you. Thank you sir. Senator. Thank you very much mr. Chair and thank you secretary. Thank you for the steady hand and detailed presentation and the points that youre hitting on certainly resinonate in oregon regarding the movement of freight, urban transit, innovating finance. Support of transportation for manufacturing, the connection between Rural Communities and markets. All of those. So well done and thank you for coming out to oregon to take a look at our crossing that certainly the federal government was a huge partner in. And the network of light rail and street cars and rapid bus transit that is being utilized to try to address some of those job to work or home to work challenges, the lost time that my colleague from new jersey was talking about. Something that has really struck me and certainly resonated in my town house across oregon is the low percent of our gdp that were investing in infrastructure. I think thats just a point reiterating. The numbers that i have generally seen but i have a feeling you have better, more Detailed Insights on this is that the u. S. Is now spending 2 of our gdp on instra fruktstructure that europe is spending 5 and china is spending 10 . I was struck in two trips to china watching beijing going from being a bicycle city to having a bullet train going 200 miles an hour. It was one of the most surreal experiences in my life. Are those numbers in the ball park . How does that reflect on the difference between the foundation were building for the economy of the next generation and what our competitors are doing. Its a great question. Those numbers are in the ball park. You know, here is theres several challenges some of which youve pointed out. One of them is that our global competitors, they have the benefit of picking and choosing from the things that weve done with our system and figuring out which of those things they are going to engage in whether its rail or highways or ports or whatever. And improving upon what weve done. It then becomes a matter of if youre a manufacturer, if you can get things from shop to port faster, some place else, it creates a competitive disadvantage for us. So one thing is that the rest of the world looked at what weve done and they are building new stuff that in many cases is better than ours. Secondly we have an ageing system, you know . Some of this stuff that youre talking about in china is relatively new. We have two problems. We have new things that we need to build that were not building and we have old things that we built a long time ago that need to be fixed up. Both of those problems create a huge challenge for this country. The third issue that we have is that and i mentioned this before but i think weve allowed our system to be stove piped. The reality is that if were going to improve our ports we need to improve our road systems and our bridges and our rail systems. If were going to do all of that, we need to also make sure that we are taking care of our inner coastal waterways and ensuring the Free Movement there. Our system is the system of systems but we cant starve it and to your point were under investing. Thank you very much. Thanks. Senator carper. Thanks. I want to thank you. I just want to applaud you and senator boxter for the spirit in which you approach this work. Its an inspiration to me and i think to all of us and i hope an example to our colleagues in the senate and to the house. And we will make it work. Mr. Secretary, a lot of nice things have been said about you this morning. Some have been really over the top. Youve been named the referred to the former mayor of charlotte. Boston. I dont know what else you have in your background but theres an old staying in our state is flattery wont hurt you if you wont inhale so all of these nice things they are saying about you, just dont breathe too deeply and youll be fine one of the major take aways from the election last november was the notion three things, one people want us to Work Together and the spirit that senator boxter and inhoff bring to the proceedings are what the folks are looking for across the country. They want us to get something done. Something real done. Not just talk about it. Not just bemoan. Actually get things done. The other thing they want us to do is to find ways to further strengthen our economic recovery which is now almost in its sixth year and starting to move well. Still people are hurting. Still a good deal that needs to be done but one of the best things that we could do. A lot of people are sitting on the sidelines who would like to do construction work. I understand they are fully funded we could put 7 or 6,000 people back to work. The other thing is weve heard any number of studies from people a lot harder than me that have talked a lot what happened to our Gross Domestic Product if we do a robust plan for america. Its between 1 and 1. 5 growth in gdp. Its real growth. I think the senator used the terms the 800 pound gorilla in the room. And i would go back to those. Theres an 800 pound gorilla in the room and its our unwillingness to pay for things that we really want or need. The Energy Policy would include generating electricity from gas cole, nuclear, wind hydro other sources. I think we may need an all of the above approach not just financing. Theres a lot of ways that we could finance stuff. Basically it means were funding money. But there are three pd Public Private partnership. Repat ri repat riation could be helpful for getting one time projects. For example the tunnel i came through under baltimore, was built in the civil war. Thats an example of a one time project. It needs a lot of money and can be funded by Something Like repat repatriation. The idea that we have not talked about a whole lot here is user fees. Weve paid for our transportation inis it a sfrukture through years. The tax that was adopted 21 years ago,. 18 cents worth dime. Meanwhile the price of asphalt concrete, steel, labor, they have all gone up. We need Something Like when we talk about base load for energy cole nuclear, gas, we need some base load here for transportation funding. Raise 175 billion. It would be a real Infra Infrastructure investment program. On top of that we need to do a whole lot more. Those other items that we referred to would be very helpful. You and i had some good conversations of late. Some of my republican colleagues have talked about why dont we just offset an increase in the user fee by reducing personal income taxes for low income people or others . The problem with doing that, we have a 480 billion budget deficit. To the extent we get rid of personal income taxes we make the deficit bigger. One of the things we talk about is finding savings is it. You shared a couple of ideas today and could actually save money. Could you just very briefly tell me where i went to get karna assada and what we can do to help. I think it is an opportunity done right in a way that doesnt compromise the government. I think it can be done very well. It would save money not just money at the federal level, it actually would work down stream at the state and local levels as well. In addition in terms of sal saving money. I think the more we work to accelerate projects that fofmove through the system at any given point or as we work on becoming better with innovative financing schools. Those are places where i think we can also stand to accelerate and get projects done a little faster. Weve worked very hard to make the program move better and faster. I think thats been a success. But riff still needs some help and i think the private activity bonds would use some too. I would ask for you to help understand that list. To the extent that we can find, modest but real and define ways to offset the increased user fees of sallings. Not in a way that degrades our environment but help us to find is it find it. I know you will have some of your people do that. Thank you. Thank you. Thank you very much for being with us mr. Secretary. In your statement you talk about how much expedite high priority projects. I agree. In wyoming we have high priority projects that can be as small as replacing a single engine bridge or replacing a segment of inner state 80. Can i ask you how they will affect states like whoa wyoming. What wed like to do is do this on a continual basis. It could be more on a routine basis for virtually all projects. I think that working with