Thank you, Mr. Chairman.  I appreciate the opportunity to comment on the three Water and Power Subcommittee bills before us today.

     These are all bills to settle water rights claims made against the federal government by various Indian tribes.  These come with a hefty price tag: $577 million, with assignment of rights to over 110,000 acre feet of water.  There are hundreds of such claims that are likely to follow.

     It is important that these claims be settled.  They involve some of the oldest standing litigation in the federal court system.  They establish something that the people of their regions – both on and off reservation – have lacked, and that is a certainty about future water rights and apportionments.  

But here is what has troubled me in my brief tenure as Ranking Member of your Water and Power subcommittee. 

These are settlements of outstanding litigation involving the United States Government.  It seems to me that the only relevant question is whether these settlements are advantageous to the government compared to its likely liability under current law.

If we were the board of directors of a private corporation deciding whether to approve a negotiated legal settlement, we would be guilty of breaching our fiduciary responsibility to stockholders if we made that decision without consulting legal counsel.

The administration has expressed reservations about all of these bills, and that should be a warning to us.  What troubles me most is that we have been unable to get a straight answer to the most important question at issue, and that is, “Do these settlements exceed the likely liability of the government if these claims went to court?”

Or to be more blunt, are we cutting our losses or are we giving away the store?  I can’t get a straight answer to that question.

The three well-intentioned bills before us today are prime examples of what’s gone wrong.   This Administration – and I might add, the last Administration –  have repeatedly testified that they cannot support funding levels in these settlements, yet they fail to provide Congress basic answers or consistency when we ask for alternative funding amounts or whether the bills are beneficial to the American taxpayer. 

As a result, Congress is being forced to choose a funding amount in the dark and without an informed opinion from our legal counsel.  In essence, we are a blind-folded arbitrator. 

     I’m new around here, but I spent 22 years in the California legislature, many of them on the relevant committees that heard settlement bills.  The central testimony in all of those settlements was from the Attorney General’s office – as our legal counsel.   They would appear before us and testify that in their professional legal judgment the settlements were justified under current law and that the state’s liability and legal costs could potentially exceed the settlement if the matter went to trial.

     This is the one critical issue that has not been addressed for these bills.

I asked this question in committee and didn’t get an answer.  Last week I sent a letter asking the Departments of Justice and the Interior asking for their assessment of the government’s liability and haven’t received an answer.

I think this is a reasonable request and one that should be answered to the satisfaction of this committee and the House before these bills are acted upon.

  There is precedent for such opinions, based upon the Department of Justice testimony in 1994 before this Committee on the Colville settlement.  There, Peter Steenland, a Clinton Justice Department official testified: “the Federal government is not that well postured for a victory on this claim which has been pending for over 40 years.  Absent the settlement, we could well litigate it for another 10 years and the outcome could easily be a significant cost to the taxpayers and the public.” 

If the Clinton Administration could give Congress a straight answer, then there’s no reason why the current one can’t. 

There’s a simple word for this.  Transparency.  We’re assured this is a guiding principle of the administration.  We truly need some in this case if we are to do our jobs competently, and do justice to both sides in these claims.

Before these bills come to the House floor, I hope that we will get the answers everyone deserves.

WASHINGTON, D.C.-Representative Tom McClintock (CA-04) announced today that the Rough and Ready Volunteer Fire Department has been allocated a grant  of $1,126,832 to assist in the construction of a new fire station.
McClintock has been working with the fire department to secure the funding, and in June wrote a letter to W. Ross Ashley of the Federal Emergency Management Agency (FEMA) to obtain the grant
“The hard-working volunteers of Rough and Ready put in hundreds of hours every year providing vital services to the people of the town and Nevada County” McClintock said. “These funds will help them meet the growing demand for fire suppression and life support services.”
“We thank Congressman McClintock for obtaining this vital grant,” Rough and Ready Fire Department Chief Don Gannon said. “We have worked hard to raise money for the new station, and the Congressman’s assistance means we will now realize our dream of building a modern facility to provide firefighting and emergency services to the people in this area,” he said.
The grant was awarded through U.S. Department of Homeland Security’s (DHS) Federal Emergency Management Agency (FEMA) and Assistance to Firefighters Fire Station Construction Grants (SCG) funded under the Fiscal Year (FY) 2009 American Recovery and Reinvestment Action (ARRA).

Representative Tom McClintock’s office learned today that Lake Clementine will remain open through fiscal year 2010, and that the Bureau of Reclamation will continue to fund and manage recreation and land use at the lake through that time. 

Below is a letter to Auburn Mayor Jim Holmes. Representative McClintock will continue to press for a lasting solution that will keep Lake Clementine open.
 

Letter from Representative McClintock to Mayor Mike Holmes:

September 25, 2009

Mayor Mike Holmes
City of Auburn
1225 Lincoln Way
Auburn, CA 95603

Dear Mayor Holmes,

I write to inform you of the decision by the Bureau of Reclamation to continue to fund and manage recreation and land use at Lake Clementine through the end of Fiscal Year 2010.  I will continue to press for a lasting solution that will keep Lake Clementine open in the future.  I look forward to working with you on this and other issues that benefit our constituents.

Sincerely,

Tom McClintock

House Natural Resources Committee, September 16, 2009.

House Chamber, Washington, D.C.  September 16, 2009.   Debate on H.R. 3221 - Student Aid and Fiscal Responsibility Act.

House Chamber, Washington, D.C.  September 16, 2009.  M. Speaker:  This measure is very much a case study in how a public option becomes a public monopoly in the span of just a few years.

 In 1993, the government created the Direct Loan Program under the pretext that it was just another option to increase consumer choice.  There was only one problem: consumers never warmed to it.  At its peak, the government Direct Loan Program only attracted 34 percent of loan volume.  Today, even with the financial difficulties in the private sector, it has only earned 27 percent of the market.

The rest is ably administered by 1,500 active lenders, servicers and guarantee agencies that employ more than 30,000 private sector workers.
 
This bill literally shuts down 40 years of successful private sector involvement with student loans and hands the government monopoly control. 

As the bumper sticker warns: the government hates competition.

 We’re told this is to save money.  Pardon my skepticism, but I seriously doubt the same government that runs FEMA will bring efficiency to the student loan program.  

It is precisely the fierce competition among loan providers that has produced lower prices for students and universities and that produces innovations in loan delivery, processing and servicing – not to mention broader benefits, such as college planning services, financial literacy education, default aversion and FAFSA assistance.

 One of those providers is the California EdFund, near my district.    

Last year alone the Ed Fund helped nearly 420,000 borrowers to avoid default, saving taxpayers $4.2 billion in default claims.  That’s ONE provider: $4.2 billion in savings for American taxpayers.

Before the government took over our auto manufacturers, Will and Ariel Durant asked, “What makes Ford a good car?  Chevrolet.”

Competition.  That creative and innovative force is snuffed out in the student loan industry by this bill.  And mark my words, if this bill becomes law, we will be back here within a few years to address growing cost overruns and inefficiencies in yet another government monopoly program.

House Natural Resources Committee, September 10, 2009.  A discussion of the philosophy that now dominates public policy: that the government’s principal focus is not to produce abundant water and power, but rather to ration shortages that government has caused by abandoning abundance as its primary objective.

September 10, 2009.  Thank you Mr. Chairman.  First of all, I want to say what a delight it has been to work with Chairwoman Napolitano, who has given all of these bills a fair, balanced and complete hearing.

We have six Water and Power subcommittee bills before us today.  They are bi-partisan and well intentioned and seek to stretch scarce water supplies throughout the Southwest.  But I do have some serious concerns that need to be addressed in the near future.

 A generation ago, the principal objective of our water and power policy was to create an abundance of both.  It was an era when vast reservoirs and hydro-electric facilities produced a cornucopia of clean and plentiful water and electricity on a scale so vast that many communities didn’t even bother to meter.

 But the last generation seems to have abandoned this objective, and to replace it with a very different philosophy that now dominates public policy: that the government’s principal focus is not to produce abundant water and power, but rather to ration shortages that government has caused by abandoning abundance as its primary objective.

 The result is increasingly expensive water and power that is now affecting our prosperity as a nation.  We’re no longer looking at cost-benefit analyses of which projects make economic sense and which do not.  Instead, practicality has been replaced by an entirely new ideological filter: those projects that ration or manage shortages are considered worthy regardless of their feasibility or cost – and projects that produce abundance are to be discouraged regardless of their economic benefits or simple common sense.

Which brings me to the fine point of the matter.  Four of these bills deal with water recycling – trying to stretch dwindling supplies rather than create new ones.  The administration opposed these bills and was honest and candid in pointing out that we have already authorized 53 such projects without the funds to finance them, producing a $624 million backlog.  The bills before us today add another four projects to the waiting list and another $110 million to the backlog.  And yet still there’s no process for prioritizing.

My biggest concern is that these four recycling bills will cost from a low of $980 per acre foot to a high of $5,400 per acre foot and this is simply not fiscally rational or fiscally sustainable. 

I don’t believe it is fair to oppose these bills today since there hasn’t been a standardized framework with which to judge them.  These bills have been in the process for some time and there aren’t any similar bills behind them.

But I do want to ask that after this batch of projects is added to a growing backlog of unfunded and fiscally questionable recycling projects that we establish a rational standard for cost-benefit analysis for all future measures.  I believe it can be as simple as requiring the Bureau of Reclamation to certify that the project is the least expensive alternative before federal funds may be released. 

Since we are approving these bills on a bi-partisan basis today I would hope that we can work together in a bi-partisan manner to assure that we’re not mandating cost-prohibitive water recycling programs just because we like the general idea with no concern about the actual cost.

Finally, we have two non-related bills introduced by Mr. Matheson of Utah which I whole-heartedly support.  One, HR 2008 clears the way for a 50 megawatt hydropower project.  The other, HR 2950 allows the Uintah Water District to prepay its obligations to the federal treasury.  This is in the interest of the District that can be relieved of interest costs and regulatory burdens.  It is also in the interest of the nation, at a time when it is running a catastrophic deficit.

 My only concern is this should take an act of Congress.  I would hope that the law can be broadened to allow any district in similar circumstances to prepay federal loans or other obligations without having to beg Congress for special approval to do so.