Mrs. Chairman, thank you for calling this hearing on the budget of the Environmental Protection Agency.  I would like to thank Administrator Johnson for being here. 

As a former Governor and Mayor, I know firsthand the enormous challenges that you have to address when crafting a budget.  This is a process that requires responsible prioritizing and fiscal discipline to avoid breaking the bank. 

And this leads me to a point I’ve made time and time again:  We must find a way to balance our nation’s environmental, energy and economic policies.  It might make us feel good to set lofty environmental goals, but those goals do little good when they are unachievable due to practical or economic considerations.  They are even less good when they impose economic hardship to those who can’t comply.   

The issue of unfunded mandates is a problem that is pervasive throughout government, but nowhere more so than in environmental regulation.  At best, standards are set with little consideration as to how they will be met.  At worst, standards are set without regard to the costs of compliance.  The national ambient air quality standards (NAAQS) and the Clean Water Act are prime examples of this disconnect between our policy objectives and a case study in unintended consequences. 

Leaving a discussion of the standards setting process to another day, I will simply say that if we set environmental standards, we must be ready, as a government, to help communities meet those standards.

In regard to this year’s budget proposal, I am concerned about funding for the Diesel Emissions Reduction Act (DERA).  DERA was designed to help meet our nation’s air quality standards by reducing emissions from the nation’s legacy fleet of over 11 million diesel engines.  DERA authorized $1 billion over a five year period ($200 million annually).  Properly funded, and leveraging match requirements for state and local governments at a ratio of $2 to $1, EPA estimated that DERA had the potential to contribute to a 70,000 ton reduction in PM emissions and generate $20 billion in economic and health benefits.   

You have requested $49.2 million for FY09 – in what will be the third year of a five year program.  I can’t stress enough the need for increasing DERA funding as we begin the appropriations process.  DERA is a well balanced policy to reduce air emissions and it would be a shame to let the program sunset before its benefits can be fully realized. 

I am also disappointed to see that the administration’s proposed funding for the Great Lakes Legacy Act is $35 million for FY2009.  This is a significant decrease from the $49.6 million that the administration proposed two years ago.  This program shows results - hundreds of thousands of cubic yards of contaminated sediments have been removed from the Great Lakes - and I strongly encourage you to work to increase funding for this program. 

Administrator, working with the Great Lakes Regional Collaboration, you have worked to make the restoration and protection of the lakes a priority at EPA.  As co-chair of the Senate Great Lakes Task Force, I am eager to find ways to improve the Collaboration’s efforts and ensure the Great Lakes programs, like the Legacy Act, receive the funding they need to be successful. 

As a member of this Committee, I have sought to bring attention to the nation’s wastewater infrastructure needs.  But as with previous years, EPA’s budget is woefully inadequate.  In fact, your request represents the lowest funding level in the program’s history!  

Continued cuts to the SRF program - when EPA estimates the nation’s need for wastewater treatment and collection at $193.5 billion - makes no sense.  This especially concerns me because my state of Ohio has one of the largest needs in the nation at $11.7 billion.  

Here are a number of examples from Ohio alone: The city of Defiance , which has a population of 17,000 and recently lost 950 auto industry jobs, is required to spend $60 million over 20 years to fix the city’s combined sewer overflow problems.  In response, the city is being forced to double its rates.  The city of Fostoria , population of 14,000, is facing a $35 million project.  This city has lost 10 percent of its jobs over the past two years, in part due to their increasing water rates.  They are being forced to increase their rates by $100 per year over the next 15 years.  EPA is requiring the city of Fremont , population of 26,000 people (49 percent are considered low-income), to spend $63 million.  Their rate increases will be 150 percent. 

EPA is simply not stepping up to the plate to assist the thousands of communities across the country facing substantial costs to comply with EPA orders.  I must tell you that from my experience as a former mayor, county commissioner, and governor, I consider this to be an unfunded mandate. 

Administrator, we are asking our communities to do the impossible.  If the federal government is going to impose these costly mandates on struggling state and local governments, then it should provide funding and flexibility for compliance with those mandates.   

 Again, I would like to thank you for your attendance today, and I look forward to hearing your thoughts on these issues.  Thank you, Mrs. Chairman.