Text: S.Hrg. 116-145 — HEARING ON S. 1087, THE WATER QUALITY CERTIFICATION IMPROVEMENT ACT OF 2019, AND OTHER POTENTIAL REFORMS TO IMPROVE IMPLEMENTATION OF SECTION 401 OF THE CLEAN WATER ACT: STATE PERSPECTIVES

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[Senate Hearing 116-145]
[From the U.S. Government Publishing Office]







                                                        S. Hrg. 116-145

HEARING ON S. 1087, THE WATER QUALITY CERTIFICATION IMPROVEMENT ACT OF 
2019, AND OTHER POTENTIAL REFORMS TO IMPROVE IMPLEMENTATION OF SECTION 
             401 OF THE CLEAN WATER ACT: STATE PERSPECTIVES

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS

                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               ----------                              

                           NOVEMBER 19, 2019

                               ----------                              

  Printed for the use of the Committee on Environment and Public Works



              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]





        Available via the World Wide Web: http://www.govinfo.gov











                                                        S. Hrg. 116-145

HEARING ON S. 1087, THE WATER QUALITY CERTIFICATION IMPROVEMENT ACT OF 
2019, AND OTHER POTENTIAL REFORMS TO IMPROVE IMPLEMENTATION OF SECTION 
             401 OF THE CLEAN WATER ACT: STATE PERSPECTIVES

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS

                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                           NOVEMBER 19, 2019

                               __________

  Printed for the use of the Committee on Environment and Public Works



              [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]





        Available via the World Wide Web: http://www.govinfo.gov 
        
                               __________

                      U.S. GOVERNMENT PUBLISHING OFFICE
                      
39-711 PDF                 WASHINGTON : 2020 
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                    JOHN BARRASSO, Wyoming, Chairman
JAMES M. INHOFE, Oklahoma            THOMAS R. CARPER, Delaware, 
SHELLEY MOORE CAPITO, West Virginia      Ranking Member
KEVIN CRAMER, North Dakota           BENJAMIN L. CARDIN, Maryland
MIKE BRAUN, Indiana                  BERNARD SANDERS, Vermont
MIKE ROUNDS, South Dakota            SHELDON WHITEHOUSE, Rhode Island
DAN SULLIVAN, Alaska                 JEFF MERKLEY, Oregon
JOHN BOOZMAN, Arkansas               KIRSTEN GILLIBRAND, New York
ROGER WICKER, Mississippi            CORY A. BOOKER, New Jersey
RICHARD SHELBY, Alabama              EDWARD J. MARKEY, Massachusetts
JONI ERNST, Iowa                     TAMMY DUCKWORTH, Illinois
                                     CHRIS VAN HOLLEN, Maryland

              Richard M. Russell, Majority Staff Director
              Mary Frances Repko, Minority Staff Director 
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
                            C O N T E N T S

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                                                                   Page

                           NOVEMBER 19, 2019
                           OPENING STATEMENTS

Barrasso, Hon. John, U.S. Senator from the State of Wyoming......     1
Duckworth, Hon. Tammy, U.S. Senator from the State of Illinois...     2
Carper, Hon. Thomas R., U.S. Senator from the State of Delaware, 
  prepared statement.............................................   147

                               WITNESSES

Gordon, Hon. Mark, Governor, State of Wyoming....................     5
    Prepared statement...........................................     8
    Responses to additional questions from Senator Merkley.......    15
Stitt, Hon. J. Kevin, Governor, State of Oklahoma................    19
    Prepared statement...........................................    21
    Response to an additional question from Senator Barrasso.....    25
Watson, Laura, Senior Assistant Attorney General and Division 
  Chief, Washington State Attorney General's Office..............    28
    Prepared statement...........................................    30
    Response to an additional question from:
        Senator Carper...........................................    42
        Senator Merkley..........................................    44

                          ADDITIONAL MATERIAL

From Senator Barrasso:
    Letters:
        To Hon. Andrew R. Wheeler, Administrator, U.S. 
          Environmental Protection Agency, from Senator Barrasso 
          et al., October 21, 2019...............................   252
        To Hon. Andrew Wheeler, Acting Administrator, U.S. 
          Environmental Protection Agency, from the State of 
          Louisiana Office of the Attorney General, February 26, 
          2019...................................................   275
        To Administrator Wheeler, U.S. Environmental Protection 
          Agency, from Mark Gordon, Governor, State of Wyoming, 
          May 24, 2019...........................................   277
        To Administrator Wheeler, U.S. Environmental Protection 
          Agency, from Mark Gordon, Governor, State of Wyoming, 
          October 21, 2019.......................................   280
        To Ms. Lauren Kasparek, Office of Water, U.S. 
          Environmental Protection Agency, from Lighthouse 
          Resources Inc., October 21, 2019.......................   285
        To Senators Barrasso and Carper, from the Portland Cement 
          Association, November 19, 2019.........................   289
        To Senator Barrasso, from the Oklahoma Department of 
          Environmental Quality, December 2, 2019................   291
        To Senators Barrasso and Carper, from Millennium Bulk 
          Terminals, Longview, LLC, December 4, 2019.............   292
    Comments of the Environmental Defense Fund on Con Edison's 
      Gas Moratorium--NYSPSC, February 13, 2019..................   296
    Case 19-G-0080. Comments of the Environmental Defense Fund, 
      State of New York Public Service Commission, In the Matter 
      of Staff Investigation into a Moratorium on New Natural Gas 
      Services in The Consolidated Edison Company of New York, 
      Inc., Service Territory, February 28, 2019.................   301
    Case 13:18-cv-05005-RJB. United States District Court, 
      Western District of Washington at Tacoma. Lighthouse 
      Resources, Inc.; Lighthouse Products, LLC; LHR 
      Infrastructure, LLC; LHR Coal, LLC; and Millennium Bulk 
      Terminals-Longview, LLC, Plaintiffs, and BNSF Railway 
      Company, Plaintiff-Intervenor, vs. Jay Inslee, in his 
      official capacity as Governor of the State of Washington; 
      Maia Bellon, in her official capacity as Director of the 
      Washington Department of Ecology; and Hilary S. Franz, in 
      her official capacity as Commissioner of Public Lands, 
      Defendants, and Washington Environmental Council, Columbia 
      Riverkeeper, Friends of the Columbia Gorge, Climate 
      Solutions, and Sierra Club, Defendant-Intervenors. Filed 
      March 8, 2019..............................................   313
    Enviro group backs pipelines, POLITICO, February 19, 2019....   323
    The U.S. Is Overflowing With Natural Gas. Not Everyone Can 
      Get It. The Wall Street Journal, July 8, 2019..............   325
    Cuomo's Carbon Contradiction, The Wall Street Journal, 
      October 20, 2019...........................................   332
From Senator Carper:
    Letter to Senators Barrasso and Carper, from the Association 
      of Clean Water Administrators and the Association of State 
      Wetland Managers, September 6, 2018........................   334
    401 Certification Survey Summary, from the Association of 
      Clean Water Administrators, May 2019.......................   336
    Letter to Senators Barrasso and Carper, from the Association 
      of Clean Water Administrators, November 26, 2019...........   338
    Letter to Senators Barrasso and Carper, from the American 
      Sustainable Business Council et al., November 19, 2019.....   341

 
HEARING ON S. 1087, THE WATER QUALITY CERTIFICATION IMPROVEMENT ACT OF 
2019, AND OTHER POTENTIAL REFORMS TO IMPROVE IMPLEMENTATION OF SECTION 
             401 OF THE CLEAN WATER ACT: STATE PERSPECTIVES

                              ----------                              


                       TUESDAY, NOVEMBER 19, 2019

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:05 a.m. in 
room 406, Dirksen Senate Office Building, Hon. John Barrasso 
(Chairman of the Committee) presiding.
    Present: Senators Barrasso, Carper, Inhofe, Capito, Cramer, 
Braun, Rounds, Sullivan, Boozman, Wicker, Ernst, Cardin, 
Merkley, Gillibrand, Duckworth, and Van Hollen.

           OPENING STATEMENT OF HON. JOHN BARRASSO, 
             U.S. SENATOR FROM THE STATE OF WYOMING

    Senator Barrasso. Good morning. I call this hearing to 
order.
    We are honored to welcome the Governors of the great States 
of Wyoming and Oklahoma today to our Committee. Governor Gordon 
and Governor Stitt have joined us to discuss a dangerous trend 
preventing our Nation from reaching full energy independence.
    A group of States are holding critical energy 
infrastructure projects hostage by abusing a provision in the 
Clean Water Act. Congress created Section 401 of the Clean 
Water Act to give States a seat at the table before Federal 
permits are issued. States deserve that seat at the table. The 
majority of States carry out this role in a responsible way.
    Recently, a select group of States have weaponized Section 
401 to stop energy projects from moving forward. As the 
director of the New Jersey Sierra Club said last year, 
``Section 401 review is probably the most effective tool we 
have to fight these projects.''
    Last year, our Committee held a hearing on this important 
issue. Many of the same projects discussed at last year's 
hearing are still being blocked. The Millennium Bulk Terminal 
Project in Washington State remains in litigation limbo. This 
important project would allow cleaner burning coal from 
Wyoming, Montana, and other western States to be exported to 
markets around the world.
    The State of Washington has refused to move forward with 
certifying the project. Washington Governor Jay Inslee denied 
the certification with prejudice, meaning the project will 
never receive State approval. Governor Inslee's denial was 
based on a claim that the project was bad for the environment.
    Well, that is just plain wrong. The Millennium Bulk 
Terminal Project would reduce emissions globally. Washington 
State is not preventing Japan and others from burning coal. 
Countries like Japan and others are going to get their coal 
from somewhere.
    Wyoming and our low sulfur coal is cleaner than coal from 
other parts of the world. Millennium Bulk is a $680 million 
project. If it had been constructed on time, the project would 
have already generated more than $12.5 billion in economic 
activity.
    The project would generate thousands of good paying jobs in 
Washington State. Local officials and labor unions strongly 
support the project, and they want to see it move forward. It 
would grow our economy and help protect our environment. 
Opposing it makes no sense, but it is what happens when policy 
decisions are made based on emotion and not fact.
    But Millennium Bulk is just one example. Since last year's 
Committee hearing, more projects have been delayed. The State 
of Oregon denied a 401 certification for a $9.8 billion 
liquefied natural gas terminal and pipeline project. This 
project would export natural gas from the western United States 
to Asia.
    New York has denied multiple natural gas pipeline 
certifications. Just like with the State of Washington, New 
York's decisions are hurting the environment. The lack of 
natural gas is causing more homes and businesses to rely on 
fuel oil, a fuel that emits 38 percent more carbon dioxide than 
natural gas. The Environmental Defense Fund recently noted, due 
to pipeline constraints, more of the dirtier fuel oils have 
been and will be burned across the Eastern Seaboard.
    As the Wall Street Journal observed recently, inadequate 
natural gas pipeline capacity leads to more pollution and 
higher energy costs for American consumers. The Journal writes, 
``The average household that uses natural gas for heating this 
winter will spend $580 compared to $1,501 for heating oil and 
$1,162 for electricity.''
    That is why I introduced the Water Quality Certification 
Improvement Act of 2019, so that States cannot unfairly block 
energy projects. President Trump also issued an executive order 
to update the almost 50 year old regulations.
    Most States aren't abusing their Clean Water Act authority. 
States like Wyoming, Oklahoma, and others have found 
responsible ways to protect the water within their borders 
while growing their economies.
    The Governors of Wyoming and Oklahoma are here to testify 
because Section 401 reform is critical to those States.
    Thank you again for joining us today, and I would now like 
to turn to Ranking Member Duckworth for opening comments.

          OPENING STATEMENT OF HON. TAMMY DUCKWORTH, 
            U.S. SENATOR FROM THE STATE OF ILLINOIS

    Senator Duckworth. Thank you, Mr. Chairman.
    Thank you again for convening this hearing, and welcome to 
all the witnesses who are here with us today.
    Water quality issues are front of mind for Illinoisans, 
because we and our neighbors are the stewards of the Nation's 
largest body of freshwater, the Great Lakes. The Clean Water 
Act is the landmark law that helps us be good caregivers. It is 
our first line of defense in ensuring the integrity of the 
Great Lakes and safeguarding the quality of the rivers, 
streams, and tributaries that feed these national treasures.
    The Great Lakes provide drinking water for tens of millions 
of Americans and support 1.5 million direct jobs. Their 
commercial, recreational, and tribal fisheries are valued at 
more than $7 billion.
    In addition to being our main source of drinking water and 
providing the region with major economic opportunity, the Great 
Lakes improve our quality of life in the Midwest. They are 
where we fish and where we swim. Weakening the Clean Water Act 
would threaten this way of life.
    That is why I strongly oppose the Trump administration's 
proposal that would degrade Section 401 of the Clean Water Act 
and gut protections for vast bodies of water that serve 
communities throughout the region. Section 401 guarantees that 
States and tribes have a voice and say in projects that require 
federally issued permits and licenses. Specifically, it rejects 
a one size fits all system by establishing a certification 
requirement that enables States and First Nation tribes to help 
optimize the conditions that must be met to secure a permit or 
license for a special project. Very reasonable.
    I recognize that developers who fail to meet the 
requirements identified by States and tribes may be frustrated 
by denials in earning Federal approval for a given project. 
However, silencing the voices and inputs of those Americans 
most directly impacted is the wrong approach, especially since 
these voices often represent the States and the tribes and the 
tribal governments that are on the front lines working to 
safeguard their water supplies.
    It is disappointing, but not surprising, that the Trump 
administration only cares about States' rights when it is to 
look the other way, allowing corporate polluters to destroy 
streams and pave over wetlands. During this hearing, we will 
hear that Section 401 leads to delays on energy projects and 
that it is abused to stop projects that are unpopular.
    However, when I asked the EPA for more information on how 
much time Section 401 adds to the permitting process, the EPA 
could not provide any information. Today's proposal would place 
highly restrictive requirements on what activities and impacts 
a State can review, as well as restrictive deadlines on the 
process. It would also give the Federal Government a veto on 
projects, and there would be no notice to downstream States for 
proposed projects.
    Many would be shocked to learn that the Clean Water Act was 
actually passed by a bipartisan majority in Congress and signed 
into law by a Republican President. However, policymakers and 
constituents of prior generations had lived through decades of 
unchecked dumping of untreated sewage, industrial waste, and 
agricultural runoff into our waters.
    We must never take for granted how, over the past 50 years, 
the Clean Water Act has reduced or eliminated pollution in our 
Nation's waterways and slowed the rate of wetlands loss. 
Congress should honor this progress by recognizing that more 
work remains to be done today, tomorrow, and in future years.
    Just last year, every beach in Illinois that was tested by 
the Environmental Protection Agency had to close for at least 1 
day, and South Shore Beach in southern Chicago was closed for 
nearly 40 days because of water contamination. My constituents 
want to swim on these beaches all summer long, and we will 
never achieve that goal by weakening the Clean Water Act. 
Simply put, healthy water means healthier families, 
communities, and economies.
    That is why I will continue fighting to preserve and 
strengthen the Clean Water Act, and always put the health and 
well being of my constituents above all other interests.
    Mr. Chairman, thank you again for holding this hearing, and 
I look forward to hearing from our witnesses.
    Senator Barrasso. Well, thank you very much, Senator 
Duckworth, for your opening statement.
    Now, we will turn to our witnesses. I am very pleased to 
introduce Governor Mark Gordon, who was sworn in as the State 
of Wyoming's 33rd Governor on January 7th of this year. 
Governor Gordon has served the people of Wyoming for years. He 
is a native of Kaycee, Wyoming, in Johnson County, grew up and 
worked on his family's ranch, became a very successful rancher 
and businessman himself.
    Prior to his election as Governor, he also served as State 
Treasurer from 2012 until this January. His leadership as State 
Treasurer resulted in improved returns on State investments, 
better protection of State savings, and increased transparency 
for the public.
    Governor Gordon's efforts to improve the State's financial 
portfolio resulted in Wyoming being ranked No. 1 in the country 
for transparency. As Governor, he is working to make Wyoming's 
government more accessible, productive, and efficient.
    Governor Gordon, we are honored that you are here 
testifying before the Committee, and I know you have much to 
share about Wyoming, our State's commitment to responsible 
energy production, and the State's strong record of 
environmental protection.
    But before we go to you--and I am looking forward to our 
continued partnership to grow Wyoming's economy--before calling 
on you, I would like to ask Senator Inhofe if he would like to 
introduce his esteemed Governor and first lady.
    Senator Inhofe. Thank you, Senator Barrasso.
    Mr. Chairman, I am proud to introduce to the Committee 
Oklahoma's First Lady, Sarah Stitt.
    Sarah, would you stand up, please?
    [Applause.]
    Senator Inhofe. With her is Governor Stitt.
    [Laughter.]
    Senator Inhofe. Governor Stitt is relatively new to the 
world of government, but he has been well known for a long time 
for his accomplishments in the State of Oklahoma. A fourth 
generation Oklahoman, Kevin spent his life as an entrepreneur, 
and founded Gateway Mortgage about 20 years ago. That has been 
a model. Under his leadership, it has gone from a small 
mortgage company to a national giant, operating in more than 40 
States with over 1,200 employees.
    Last year, Kevin was elected Governor, and his 
administration is already reforming our State. He is focused on 
all the right things, with a vision of making Oklahoma a top 10 
State in all key statistical areas, and he is well on his way 
by cutting bureaucracy, growing jobs, and improving Oklahoma's 
roads and bridges.
    I have gotten to know him well and am confident that he 
will continue to make Oklahoma proud, and I look forward to 
hearing his testimony today. He has accomplished so much in 
such a short period of time, and it shows that States are 
relevant.
    Thank you, Mr. Chairman.
    Senator Barrasso. Well, thank you very much, Senator.
    I would also like to welcome to the Committee today Laura 
Watson, who is the Senior Assistant Attorney General and 
Division Chief for the Washington State Attorney General's 
Office.
    Welcome.
    I want to remind the witnesses that your full written 
testimony will be made part of the official hearing record, so 
please try to keep your statements to 5 minutes so that we have 
time for questions. We look forward to hearing your testimony.
    Governor Gordon, would you please begin?

                STATEMENT OF HON. MARK GORDON, 
                   GOVERNOR, STATE OF WYOMING

    Mr. Gordon. Thank you, Mr. Chairman, it is a pleasure to be 
here.
    Well done, Senator Inhofe.
    Thank you also, Ranking Member Duckworth, and members of 
the Committee.
    Wyoming is blessed with an abundance of resources and has 
thus been the center of energy production and a leader in 
environmental protection. Much of our economy is in fact based 
on our ability to export energy to heat homes, light cities, 
and better lives.
    We are also home to thriving wildlife and some of the 
Nation's cleanest air and water. Wyoming is headwaters to three 
of the Nation's major rivers: the Missouri, the Colorado, and 
the Columbia. Protecting water quality within our State has 
always been important to Wyoming. We recognize the value of 
clean water and earnestly strive to protect it.
    This is done, in part, through responsible application of 
the Clean Water Act Section 401. Regrettably, a recent Clean 
Water Act Section 401 decision by Washington State imperiled 
the development of infrastructure that could expedite the way 
Powder River coal gets to overseas customers.
    In the case of Millennium Bulk Terminal in 2017, Washington 
State blocked the terminal's construction by inappropriately 
denying Section 401 certification, citing several non-water 
quality related impacts. This was a protectionist maneuver, 
based on alleged effects that are outside the scope of Section 
401. With a fanciful interpretation of Section 401 processes, 
Washington State actively prevented coal mined in Wyoming, 
Montana, Utah, and Colorado efficient access to foreign 
markets.
    The Clean Water Act, particularly Section 401, is designed 
to allow States to protect water quality within their 
boundaries. It is not a tool to erect trade barriers based on 
political or parochial whims, nor a way to preempt interstate 
commerce.
    Reform of Section 401 is not an assault on the environment, 
a means to prevent States from taking control of their own 
destiny, or a cloaked attempt at climate change denial. We 
acknowledge that CO2 concentrations in our 
atmosphere are an urgent concern for our climate and must be 
addressed effectively, while we also recognize that the world 
needs energy.
    With commitment, vision, and courage, we can take advantage 
of all our resources in a responsible manner to solve for both 
a cleaner and better world. I come to you today with a goal of 
finding solutions. We can protect water quality, build 
infrastructure responsibly, address climate change, and promote 
interstate commerce under Section 401.
    Clean Water Act Section 401 reform should be driven by 
facts and designed to minimize negative externalities and 
social cost. The Clean Water Act already provides a framework 
for this by granting broad responsibilities to States under 
Section 401 while allowing the necessary flexibility to fulfill 
their roles as co-regulators to protect our Nation's waters.
    Unfortunately, the Section 401 certification process has 
also led to inconsistent interpretation and implementation 
among States. Loopholes in Federal environmental regulations 
should not be exploited to advance peripheral agendas. Section 
401 certification decisions must be focused, efficient, 
reliable, and appropriately balance the Federal Government's 
province with State autonomy.
    Chairman Barrasso's bill, S. 1087, entitled Water Quality 
Certification Improvement Act of 2019, recommends real 
improvements to the Clean Water Act Section 401 certification 
process, while also respecting the rights of States under the 
Commerce Clause to the United States Constitution. I 
emphatically support these efforts.
    In Wyoming, our Section 401 certifications are based on 
water quality and completed within a reasonable time. That is 
usually around 60 days on average. Elsewhere, some States 
apparently have found in Section 401 of the Clean Water Act 
novel ways to block projects rather than using it correctly, as 
a regulatory framework to address attendant water quality 
concerns.
    The congressional purpose of the Clean Water Act was to 
protect and maintain water quality. However, some certifying 
authorities have interpreted Section 401 to include tangential, 
non-water quality related considerations in their review.
    In Washington, for example, the Department of Ecology 
decided to employ the State's open ended discretionary policy 
to deny the Millennium Bulk Terminal Section 401 certification. 
The department's decision was heavily skewed on non-water 
quality based impacts, ranging from greenhouse gas emissions, 
from rail noise and vibration from trains, social and community 
impacts from noise and air pollution, decreased rail safety, as 
well as tribal and cultural resource impacts.
    The inclusion of these factors is arguably superfluous to 
the original intent of the Clean Water Act. Properly, the scope 
of Section 401 review or action must directly connect to 
addressing water quality impacts from potential discharges 
associated with a proposed federally licensed or permitted 
project. The Washington Department of Ecology denial of 401 
certification for the Millennium Bulk Terminals was fickle, 
based on loose if not absent connection to impacts on water 
quality.
    Furthermore, when Washington State denied the project with 
prejudice, it precluded the terminal's opportunity to amend its 
application or ever to reapply. Evidently, Washington found 
Section 401 useful as a tool to curtail a specific project it 
found displeasing, rather than allowing the project's applicant 
the opportunity to address appropriate associated water quality 
impacts.
    The two main areas that I advocate for reform in context 
with Wyoming's experience relate to one, the scope of 
environmental reviews, and two, the basis for certification 
denials. Certification denials must have a clear and reasonable 
assertion that the project activities would, No. 1, result in 
violation or fail to conform to one or more surface water 
quality standards; two, result in an increase in pollutant 
loading to a Clean Water Act 303(d) listed water; or three, 
would not conform to applicable 401 certification conditions or 
Corps nationwide permit conditions.
    Finally, let me speak to the correct implementation of the 
Clean Water Act, cooperative federalism, and the essential 
rights of States. States must be afforded reasonable authority 
over land and water resources within their borders. Section 401 
is an essential tool granted by Congress which was intended to 
give States discretion in reviewing and conditioning 401 
certifications and to ensure concordance with both Clean Water 
Act and State surface water quality standards.
    Still, proper implementation of Section 401 of the Clean 
Water Act should line up with the original intent and also 
recognize the individual jurisdictional rights of States to 
manage their own affairs and conduct commerce. The draft Water 
Quality Certification Improvement Act of 2019, sponsored by 
Chairman Barrasso and Senators Daines, Inhofe, Capito, Enzi, 
and Cramer, offers a much needed improvement to Section 401 of 
the Clean Water Act by reducing uncertainty and limiting the 
potential for misuse.
    Rules and regulations should be squarely centered on 
purpose, in this case, water quality. They should not become an 
all of the above artifice to thwart unwelcome projects with 
prejudice.
    I appreciate your efforts to clarify Section 401 
implementation and the EPA's recent efforts to modernize its 
Section 401 guidance. Both are needed, and I look forward to 
answering your questions.
    Thank you.
    [The prepared statement of Mr. Gordon follows:]
    
    
               [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
 
    Senator Barrasso. Thank you very much, Governor Gordon.
    Governor Stitt.

               STATEMENT OF HON. J. KEVIN STITT, 
                  GOVERNOR, STATE OF OKLAHOMA

    Mr. Stitt. Chairman Barrasso, Ranking Member Duckworth, and 
senior member Senator Inhofe, thank you for inviting me to 
testify on why it has important for my State of Oklahoma to 
have clarity and certainty around Section 401 of the Clean 
Water Act.
    As you may be aware, I am 11 months into being Governor of 
the great State of Oklahoma. Less than 1 year ago, I was in the 
private sector, building a business in two of the most 
regulated sectors in the United States, banking and mortgage 
lending. I started my company from scratch and built it to over 
1,200 employees doing business in 41 States.
    I say this because I want to share that as a former CEO, I 
understand the importance of common sense regulations. 
Efficiency and certainty from State and Federal regulators 
allow a CEO to put more of his or her focus on creating jobs 
and growing the economy. Anything short of regulatory certainty 
and predictability stifles job creation, chills capital 
markets, and slows down innovation for advances that make us a 
better and stronger society.
    Today, serving as Governor of the great State of Oklahoma, 
I have had the honor and opportunity to view the regulatory 
environment from this side of the government. I can speak with 
great assurance that regulations are best left to the States as 
often as possible. We know our people, we know our geography, 
we know our economies, and we know best when innovation demands 
regulatory flexibility, and when protecting our citizens 
requires action.
    Oklahoma is a huge success story for States' rights and 
Federal partnership. I am here today to share with you why we 
must continue to strike this balance between modernizing and 
clarifying Section 401 of the Clean Water Act.
    As you all know, Oklahoma has a long and storied history of 
leadership and innovation in the production of traditional 
fossil energy. We are grateful to Senator Inhofe who has been a 
champion for our State on these issues.
    Today, Oklahoma ranks No. 3 in natural gas production. We 
rank No. 4 in oil production, and we are a leader in natural 
gas liquids that form the building blocks for the products 
Americans use every day. We are proud to be considered the 
pipeline capital of the world.
    Oklahoma is top 10 in all aspects of energy, as well as in 
the environment. We are enjoying some of the cleanest drinking 
water in our State's history.
    We have the most practical regulatory framework and some of 
the most efficient permitting review times in the country. We 
are meeting our obligations and certifying water quality 
standards within 60 days of the application, well under the 1 
year timeline proposed by the Environmental Protection Agency.
    Thanks to Oklahoma produced natural gas and the shale 
revolution, my State has also reduced emissions in 
SOx, NOx, and CO2 at more than 
double the national average. The national average for 
CO2 reduction is nearly 15 percent since 2015, while 
Oklahoma has reduced its CO2 emissions in the power 
sector by more than 37 percent, just since 2011.
    We have made major advancements in environmental quality 
while also maintaining the No. 1 ranking in cheapest 
electricity cost to the customer. As a result, Oklahoma is the 
leading generator and exporter of power in the Southwest Power 
Pool, which is our regional transmission organization. In fact, 
28 percent of the power produced in Oklahoma is sent out across 
transmission lines in the SPP, exporting Oklahoma's emission 
reducing energy to all of our neighboring States.
    Oklahoma is the epicenter of America's energy dominance, 
and we want our success to be shared with our neighbors and our 
fellow States as far north as Maine, and as far south as the 
ports in Houston, Texas. Unfortunately, the misuse of Section 
401 threatens Oklahoma's potential and the endless 
opportunities for our 4 million residents. It prevents Oklahoma 
from achieving all it can be because of a loophole within 
Section 401 that is allowing a small handful of coastal States 
to dictate the future for all the other 40 States.
    Unfortunately, this is just unacceptable. The point was 
absurdly exemplified the last winter when a Russian tanker of 
liquefied natural gas was sitting in the Boston Harbor, 
providing for the Northeast U.S. from losing its heat during 
last winter's polar vortex. Imagine what that picture 
communicates to hard working oil and natural gas employees 
around the country. Do we really want our jobs and our tax 
dollars needlessly going to Russia?
    For that purpose, I support the actions taken by EPA and 
members of this Committee to restore certainty to the Clean 
Water Act permitting and certification process under Section 
401. A clear scope and a reasonable timeline are not invasive 
to States' rights. The current proposed rule, and the 
opportunity to strengthen this legislatively does nothing to 
prevent Oklahoma's regulators from properly and scientifically 
considering whether a project negatively affects water quality 
in our State.
    It has been almost 50 years since this regulation has been 
reviewed, and I support creating a reasonable baseline for 
Clean Water Act permitting and certification of interstate 
infrastructure, whether it is transmission lines, pipelines, or 
an interstate highway, to get Oklahoma's products to the 
market.
    Once again, thank you for allowing me to be here today. I 
look forward to answering your questions.
    [The prepared statement of Mr. Stitt follows:]

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    Senator Barrasso. Thank you very much, Governor.
    Ms. Watson.

 STATEMENT OF LAURA WATSON, SENIOR ASSISTANT ATTORNEY GENERAL 
 AND DIVISION CHIEF, WASHINGTON STATE ATTORNEY GENERAL'S OFFICE

    Ms. Watson. Thank you Chairman Barrasso, Ranking Member 
Duckworth, and members of the Committee.
    My name is Laura Watson. I am a Senior Assistant Attorney 
General of Washington State, and I am honored to be here today 
to talk about how important a State's role is in protecting 
against water pollution for all Americans.
    Under the Clean Water Act of 1972, Congress empowered 
States and tribes to serve as co-regulators with the Federal 
Government. This includes longstanding State authority under 
Section 401 to ensure that federally permitted activities and 
projects don't harm State waters.
    For the past 50 years, States have successfully implemented 
Section 401. For example, in the past half-century, Washington 
State has issued thousands of 401 certifications and 
approximately 30 denials. Only a few of these decisions have 
ever been appealed.
    Though States have demonstrated a fair and successful 
implementation of Section 401, today Section 401 is on the 
chopping block.
    First, EPA has proposed a rule that would seize control of 
401 decisions from States and place those decisions in the 
hands of Federal agencies. EPA's proposed rule would 
drastically narrow the scope of 401 review. It would severely 
restrict the amount of time and information that States have to 
make their decisions, and it would grant Federal agencies veto 
authority over State decisions.
    EPA's proposal crosses the legal line in many ways, which 
is why it is broadly opposed by States and tribes across the 
country and political spectrum.
    South Dakota says that the rule is a poorly disguised 
effort by the Federal Government to severely limit State and 
tribal efforts to enforce water quality standards.
    West Virginia says that the rule would undermine the 
authority originally provided to States in the Clean Water Act.
    Arkansas says that allowing the Federal Government to 
override a State decision is by no means in the spirit of 
cooperative federalism.
    Montana says that Montana's ability to protect water 
quality should not be weakened by Federal rulemaking.
    The National Congress of American Indians says that the 
proposed rule impermissibly threatens Indian tribes' right to 
self-governance, and the Upper Snake River Tribes Foundation 
calls the rule a slap in the face of tribal sovereignty.
    EPA's rule is only one concern that we face today. Senate 
Bill 1087 imposes some of the same problematic concepts in the 
rule and would further threaten to erode State rights. Both 
proposals run counter to the concept of cooperative federalism 
and the spirit and letter of the Clean Water Act, and both 
proposals would inevitably compromise clean water for families 
and communities across the Nation.
    These extreme changes being proposed are both unfounded and 
unnecessary. They appear to be based on disagreement with a few 
State decisions, including Washington State's denial of a 
Section 401 certification for a proposed coal export facility 
on the Columbia River. That decision has been improperly cited 
as an abuse of authority, so I would like to set the record 
straight.
    Washington's 401 denial was based on water quality grounds. 
Climate change and greenhouse gas considerations were in no way 
a factor in the State's denial. I understand that the denial 
decision will be made part of the record today, and you will 
see that my description of it is 100 percent accurate.
    Rather than upending five decades of cooperative federalism 
and eroding the rights of every State and tribal government 
over a single 401 decision, we urge this Committee to recognize 
the important role that States and tribes play in protecting 
water quality, and to uphold the longstanding partnership we 
share under the Clean Water Act.
    I thank you, and I look forward to your questions.
    [The prepared statement of Ms. Watson follows:]
    
    
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    Senator Barrasso. Thank you very much Ms. Watson.
    Thank you for the testimony of all of you.
    We will now start with rounds of questioning, and I would 
like to start with Governor Gordon.
    The Washington blockade of coal exports prevents millions 
of tons of Wyoming coal from reaching foreign markets. I am 
going to, without objection, enter into the record a letter in 
support of today's hearing from the National Mining 
Association.
    [The referenced information follows:]

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    Senator Barrasso. Governor Gordon, the Association explains 
that ``For every million tons of coal exported, an estimated 
1,320 jobs are created.'' So I would like to ask, how is 
Washington State's abuse of the certification process hurting 
Wyoming workers and harming the economy of our home State?
    Mr. Gordon. Thank you, Mr. Chairman. Washington's blockade 
has brought a certain amount of uncertainty to coal markets 
going forward unjustifiably. In Wyoming, we have seen this year 
in the coal markets, with the work that has been done 
nationwide, including Washington, several bankruptcies of 
Westmoreland Coal, Arch, Peabody, Cloud Peak, Blackjewel, with 
attendant pension challenges, healthcare challenges.
    We had 350 workers that were out of work in Gillette as of 
July 1st when Blackjewel went down. Our State has had to 
respond dramatically to that to make sure that people found new 
jobs, to work with companies to try to find a placement for 
that and also to handle some of the challenges with healthcare.
    That is not exclusive to Wyoming. The coal strip also has 
seen losses of jobs and population, and it is a dramatic loss 
to the State's revenues.
    Let me just say, too, Mr. Chairman, that we do it better. 
We have the strongest environmental laws in the world. We 
require the best working conditions in the world. The coal is 
going to be burned overseas regardless. Washington's own 
documentation indicated that, as far as global warming is 
concerned, that the work that was done to get our coal to 
market would actually reduce carbon emissions over time.
    I just want to make that point once again. We have strong 
environmental and labor conditions here. Our mining is done 
better under better reclamation standards and fully bonded, so 
I think generally speaking it is problematic to have that, what 
we have seen with the losses of jobs.
    Senator Barrasso. So the State of Washington has access to 
the coast, something that landlocked States like Wyoming do 
not. What kind of precedent does it set when States that are 
landlocked can have their lawful products blocked from being 
exported by coastal States?
    Mr. Gordon. Well, so, I think this is an issue that, 
hearing Ms. Watson's testimony where she talked about the 
erosion of rights, this goes back to the beginning of our 
country and certainly part of the Constitution. You can read in 
The Federalist 6 and 7 that talk about the various rivalries 
between States.
    What happens is when coastal States deny access to products 
that are either raised or produced in the center of the 
country, we lose our marketplace. We lose interstate commerce, 
we lose our ability to be able to have a good economy, and 
where does that all end?
    If you look whimsically at how you want to apply these 
rules, natural gas could be one of the issues. We've seen that 
at Jordan Cove. Perhaps GMO grains become displeasing, and we 
decide we are not going to ship GMO products. Lumber, perhaps 
that is another thing that could be decided against, or dairy 
products, any of these things that can be traded 
internationally.
    Mr. Chairman, I think it is about balance. That is exactly 
what your bill does. It does a very good job of balancing 
States' rights to co-manage their own affairs with those that 
have to do with the Commerce Clause of the Constitution.
    Senator Barrasso. Governor Stitt, you have a lot of 
experience with permitting gas pipelines in Oklahoma. How does 
Oklahoma protect water quality while permitting these critical 
pipelines?
    Mr. Stitt. Our DEQ certification process, we look at that 
and make sure that all of it administratively is complete. Then 
we look at all the maps, the drawings, the studies, the 
environmental impact assessments, the plans, information 
related to endangered, rare, or threatened species. Then we 
start going through the surface water and the groundwater and 
the natural resources potentially affected by any of these 
activities. Then we make sure that it meets with all the Clean 
Water Act's and then our State quality standards, and we do all 
this within 60 days.
    I would like to just share with you some of the facts that 
we are so proud of in Oklahoma. Oklahoma was No. 1 in the 
Nation in phosphorus load reduction in 2018 in our water 
bodies. Oklahoma was No. 3 in the Nation in nitrogen load 
reductions in 2018. Oklahoma is No. 1 in the Nation for non-
point source success stories, with more water bodies de-listed 
from the impaired list than any other State.
    So we have some of the cleanest water, and yet we are the 
pipeline capital of the world, so the Diamond pipeline that 
runs just south of Tahlequah, Oklahoma, was just ranked the 
cleanest and the best tasting water in the country. We are very 
satisfied with our water quality standards and how we review 
all those 401 applications.
    Senator Barrasso. Thank you.
    Senator Duckworth.
    Senator Duckworth. Thank you, Mr. Chairman. From the 
testimony so far, you would think that this was a hearing about 
the importance of coal as an energy source, as a global energy 
source, as well as coal as a major provider of employment, and 
I could not agree with either more. Illinois is also a major 
exporter of coal, and we are also a State from the center of 
the country that must export through coastal States.
    But what this hearing is really about is about States' 
rights and tribal governments' rights to evaluate the impact of 
pollution, and really, about the EPA's proposed revision to 
Section 401. So let's focus ourselves back on the issue at 
hand.
    The EPA's proposed revision to Section 401 would narrow the 
scope of what States can evaluate in reviewing a project's 
water quality impact, and it only allows them to consider the 
direct impact of a point sources discharge on water quality.
    However, major infrastructure projects can have both direct 
and indirect effects on water quality. For instance, pipelines 
can directly degrade water quality through leaks or spills. 
They can also indirectly harm water quality through runoff and 
soil erosion during construction.
    I am very pleased to hear that Oklahoma has done a 
wonderful job of safeguarding your water sources and making 
sure that your pipelines are cleanest and safest. I would think 
that other States would like to have the ability to safeguard 
their own water sources.
    Ms. Watson, of the State agencies that commented on the 
rule, nearly 75 percent expressed serious concerns about this 
provision. Are you concerned about this narrower scope, and how 
would this impact your State's ability to protect your water 
resources?
    Ms. Watson. Absolutely, Senator, and thank you for the 
question. The rule would absolutely impact every State's 
ability to protect water resources, so in Washington, it would 
be Puget Sound and the Columbia River. In Florida, it would be 
the Everglades, and in your lovely State, it is the Great 
Lakes.
    There is no question that there would be greater water 
pollution, both as a result of the EPA rule and from Senate 
Bill 1087, because it so drastically narrows the scope of what 
can be considered.
    As Governor Stitt was talking about what Oklahoma considers 
groundwater standards and protections for endangered species, 
looking at all State water quality requirements, all of those 
things would be on the chopping block as a result of both the 
bill and the rule. States would no longer be able to fully 
protect against water pollution, and that is a big problem.
    Senator Duckworth. Thank you. The stated purpose of EPA's 
proposed rule is to increase the transparency and efficiency of 
the 401 certification process and to promote timely review of 
infrastructure projects. Yet the EPA is imposing new 
administrative burdens on States as part of this rule, 
requiring them to provide substantial amounts of new 
information, including legal citations to the EPA just to 
justify their decisions to grant certifications with 
conditions, all under a new constraint application review 
timeline.
    Ms. Watson, considering the number of 401 certification 
applications that the Washington Department of Ecology receives 
and processes each year, how do you anticipate these new 
requirements will affect the State's efficiency in processing 
applications?
    Ms. Watson. Actually, and ironically, Senator Duckworth, I 
think what would happen is that you would actually see States 
denying more 401 certifications. So, a rule that is intended to 
streamline 401 certifications is going to have the unintended 
consequence of resulting in more denials, because States can't 
make decisions without full information. Then on top of that, 
the States have to pad their decisions to convince the Federal 
agency that the decision they have made is the correct one.
    I think what you are going to find is more denials across 
the board. A lot of States raised that in their comment letters 
as well.
    Senator Duckworth. Thank you. It is proposed that the EPA 
list seven basic components that project proponents must 
provide in order to constitute a complete certification request 
and trigger review period. Do you agree that the EPA should 
constrain the amount of information the project proponents must 
provide to States?
    Ms. Watson. Absolutely not, Senator. The problem is then 
States will not have the information they need to determine 
that water pollution will not result from the Federal project, 
and the results will be unclean water, dirtier water, across 
the country for our families and our communities.
    Senator Duckworth. Thank you, and I actually want to say 
that this is really about these particular changes to this one 
rule. This is not a hearing about coal, in fact.
    I am proud that Illinois just received a grant for clean 
coal. I want America to own clean coal, carbon capture 
sequestration technology. I want to sell American coal 
overseas. This is actually about States' abilities to safeguard 
their own water supply under this one particular rule, so let's 
focus on that.
    Thank you, Ms. Watson.
    Senator Barrasso. Thank you, Senator Duckworth.
    Senator Inhofe.
    Senator Inhofe. Thank you, Mr. Chairman.
    Governor Stitt, as you said in your testimony, Oklahoma has 
been on the front lines in America's energy independence, and 
it has worked. America leads the world in oil and gas 
production, and we have done all this while reducing pollution 
and leading the world with the cleanest drinking water. You've 
already talked about that.
    Let's talk about the economic impact of energy produced in 
Oklahoma. One in five jobs are tied to oil and gas production, 
with an average salary in this industry is over $94,000. 
Governor Stitt, what would happen to Oklahoma's electricity and 
energy prices if natural gas production ceased to exist?
    Mr. Stitt. Thank you, Senator. It would be devastating to 
our economy. Our energy costs, our electricity costs to the 
consumer would more than double. We get 42 percent of our 
electricity generation from natural gas. Without natural gas to 
generate that baseload, when the winds don't blow, when the sun 
doesn't shine, we would be without power. It would be 
devastating to the electric grid.
    Twenty-eight percent of our revenue comes from the oil and 
gas industry, so countless numbers of jobs; it would just be 
devastating to our economy.
    Senator Inhofe. Let's talk about other States, how Oklahoma 
can help lower costs of other States' electricity and energy 
bills.
    Mr. Stitt. With the amount of natural gas that we have, we 
would love to be able to transport that to other States to help 
with their energy costs, their generation. Natural gas is such 
a clean burning fuel that we would love to be able to transport 
that to other States and help with their low energy costs as 
well.
    Senator Inhofe. Hopefully in the same way that it has been 
helping us for a long period of time.
    Mr. Stitt. Absolutely. I just want to tell you one other 
fact that I think is significant. Since 2011, Oklahoma has 
reduced its emissions by nearly double the national average. 
Sulfur dioxide is actually down by 56 percent, nitrogen oxide 
is down by 69 percent, carbon dioxide is down by 37 percent in 
Oklahoma, so we are definitely leading the way in our emissions 
reductions.
    Senator Inhofe. Yes, and we can't overlook the President's 
policies and how successful they have been. A lot of our 
colleagues often claim that Republicans don't care about the 
environment. It couldn't be further from the truth, as you 
pointed out.
    If you are looking at since 1970, the combined emissions of 
the six pollutants dropped by 74 percent while the economy grew 
by 275 percent. Now, this is even more astonishing when you 
look at since 2005, the U.S. energy related CO2 
emissions fell by 14 percent, while global emissions increased 
by over 20 percent. It is hardly believable.
    Is there anything that you have not spoken to already on 
what Oklahoma has done to protect water quality? Because we 
have the best that is out there.
    Mr. Stitt. I love the stats in our State, and I have 
already outlined them about the pipeline capital of the world, 
but yet the cleanest water, and the reduction. We are No. 1 in 
several categories in reducing non-point and also nitrogen into 
our water bodies. So, just excellent success stories in 
Oklahoma.
    Senator Inhofe. It really is. In fact, this morning, my 
wife was pointing out one of the bottled water things. It came 
from Tahlequah, Oklahoma.
    Anyway, we are doing a great job. Let's try to share that 
with others.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you, Senator Inhofe.
    Senator Cardin.
    Senator Cardin. Well, thank you, Mr. Chairman.
    I thank all three of our witnesses for their testimony. 
This is certainly an area of great interest.
    I spent 20 years of my life in the State legislature, 8 as 
Speaker, so the ability of the States to work in partnership 
with the Federal Government, federalism to me is very, very 
essential and important to our system of government.
    So Mr. Chairman, I first ask unanimous consent to submit 
comment letters by the National Governors Association; the 
Attorneys General of the States of Washington, New York, 
California, Colorado, Connecticut, Delaware, Hawaii, Illinois, 
Maine, Maryland, Michigan, Minnesota, New Jersey, New Mexico, 
North Carolina, Oregon, Rhode Island, Vermont, Wisconsin, the 
District of Columbia, the Commonwealth of Massachusetts, 
Pennsylvania, Virginia; the Maryland Department of Environment 
and the Waterkeepers Chesapeake, and the Chesapeake Bay 
Foundation of concern about the Chairman's bill.
    Senator Barrasso. Without objection. We accept them all.
    [The referenced information follows:]

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    [The referenced comments from the Attorneys General are 
available at https://oag.ca.gov/system/files/attachments/press-
docs/Multi-State%20Comment%20on%20WQ%20Certs.pdf]
    Senator Cardin. I appreciate the Chairman's generosity in 
allowing us to put that in the record, as he is always very 
generous in listening to all views.
    I want to follow up on Senator Duckworth's point about the 
practical effects, if we restrict the powers of the State under 
401 certifications. We just completed, in Maryland, a rather 
lengthy process in regards to the Conowingo Dam and Exelon 
Corporation. The Conowingo Dam is the second largest producer 
of electricity, hydroelectricity power on the east coast of the 
United States, a critically important power source for our 
entire region.
    But it is critical to what is happening with the quality of 
the water in the Chesapeake Bay. It is not just the immediate 
impact of what goes over the dam, but it is also the impact 
that it has on upstream and downstream.
    There was a lengthy process in negotiating with the 
different stakeholders. On October 30th, Exelon and the State 
of Maryland announced an agreement just short of the 12 month 
limitation period.
    There are pros and cons to the agreement that was reached. 
It does provide for Exelon to contribute some resources; there 
are some additional aspects in regard to how the migration of 
fish are handled, so there are some different aspects to this. 
There are a lot of stakeholders who felt that they should have 
been more aggressive, but they were able to reach an agreement, 
and it will help the Chesapeake Bay Program.
    I don't think it would have been possible to do this in a 
90 day period. Just too complicated to get done in a 90 day 
period. So, I am just wondering why we would want to restrict 
the State's leverage. The State had minimal leverage to start 
off with because the dam had to operate; it was critically 
important for electricity.
    But they were able to utilize the different stakeholders 
and come together for a productive conclusion. But if we narrow 
the period of time, aren't we just making it virtually 
impossible for the States to utilize this opportunity for clean 
water?
    The Chesapeake Bay Program is one I talk about frequently 
in this Committee. I guess my Committee members might be a 
little bit tired of listening to me, but since Senator 
Duckworth brought up the Great Lakes, I had to bring up the 
Chesapeake Bay.
    The Bay Program was from the ground up. It started with the 
States and local government and local stakeholders. It wasn't a 
Federal Government mandated program; it was a State initiative 
program, with States taking leadership on it.
    Now, if we say the States can't use the tools that they 
have in an effective manner, aren't we just handcuffing the 
States' ability to get things done?
    In this case, Ms. Watson, it would not have been possible 
for the State just to deny the application, because we need the 
electricity. But wouldn't we be compromising the ability of the 
States to leverage for clean water in our region? The States, I 
think, know the local circumstances better than the Federal 
Government.
    Ms. Watson. Yes, Senator, absolutely, and thank you for 
your question. If you are limiting the amount of time that 
States have to make decisions, you are limiting the ability 
that States have to be able to reach those important deals, to 
work with the project proponent, and make sure that a project 
can go forward with the greatest possible protection for water. 
That is the system that is been in place for the last 50 years. 
It has worked very, very effectively.
    Senator Cardin. Governors, if you wish to comment, fine. 
You have to deal with a lot of different players in your 
States. Ninety days for something as complicated as a multi-
jurisdictional body of water like the Chesapeake Bay is 
virtually impossible.
    Mr. Stitt. I don't think it would hamper your ability to go 
after bad actors, come up with a settlement. The 60 day 
proposal for Clean Water, our State does it in 60 days, so the 
1 year timeline is just a reasonable time in scope. We think it 
is very reasonable for this Committee and the EPA to revise 
their rules.
    The State of Minnesota has arguably more water than any 
other State. Oklahoma actually has more manmade lakes and 
shorelines. They are getting their permits done in 90 days, so 
just the reasonability of this time in scope, I don't think 
limits the States' ability to oversee water quality or go after 
a bad actor.
    Senator Cardin. It may be true for your State, but I would 
put you in the seat of Governor Hogan of Maryland and all the 
different stakeholders he has to deal with on these issues, and 
other States that he has to deal with.
    Thank you, Mr. Chairman.
    Mr. Gordon. Mr. Chairman, if I might respond, Mr. Chairman 
and Senator Cardin. I appreciate the fact that you brought this 
back to the topic at hand, which is the proper use of the Clean 
Water Act and Section 401.
    As the former Chair of our State's independent 
environmental quality council, which is charged with not only 
making rules, but also is the first appeal body for any 401 
permit that is granted in the State, I have experience with 
this program. I have to say that Wyoming also has multi-State 
jurisdictional issues. The Colorado River, for example, 
involves almost all the Southwest. The Columbia River also has 
several States on it.
    We do our work within 60 days on average, but we are up to 
a year. I don't think that is unreasonable, and I think this 
particular Act actually does two things. One is, it talks about 
the scope, and as we make the scope larger, of course the job 
becomes longer. So, this is an attempt to, it seems to me, 
bring well needed reform to considering water quality impacts 
that are associated with a core permit or surface water issue.
    Senator Cardin. I will just make a final comment. We are 
not good examples here, but it is better if we have greater 
consensus among the Governors on the reform before it has 
brought here to Congress. I would like to have greater 
consensus among all of us.
    This Committee usually works in a very consensus way, but 
it would have been better if we had more of the States in 
agreement as to how these reforms should take place.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you, Senator Cardin.
    Before turning to Senator Capito, I am going to ask 
unanimous consent to enter into the record a letter from the 
Kansas Attorney General in support of today's hearing. Attorney 
General Kevin Schmidt states that S. 1087--he said, ``would 
prevent future uses of Section 401 to deny development of 
constitutionally protected interstate commerce.''
    I would also like to enter into the record a court filing 
by eight States, including Oklahoma and Wyoming, who are 
opposing Washington's denial in court.
    [The referenced information follows:] 
    
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    Senator Barrasso. Senator Capito.
    Senator Capito. Thank you, Mr. Chairman, and thank you for 
scheduling the hearing on our bill, the Water Quality 
Certification Improvement Act and efforts to improve 
implementation of 401 broadly. I am very appreciative of that.
    I would like to ask a process question first, Governor 
Gordon. In the process, the State permits under the 401, but 
once that permit is granted, there are all kinds of other 
Federal agencies that then weigh in on the permit, like the 
Corps, Fish and Wildlife. Can you flesh that out a little bit 
for me? If you don't know the details, I can write it in a 
written question.
    Mr. Gordon. Thank you, Mr. Chairman and Senator Capito. You 
are correct. Section 401 is specifically about water quality. 
It is not intended to be a catch all for all environmental 
regulation, and I think it is important that we keep--and I 
think that is what the value of this particular draft bill is, 
is to make sure that we keep it on topic of water quality. 
Because as you point out, there are many other agencies that 
weigh in beyond that, from the Corps of Engineers, to Fish and 
Wildlife Service, and others. So it is an extensive process 
that really has to be done both on a State and a Federal level.
    Senator Capito. Right. So I would like to point out that 
this legislation does not violate our States' rights to protect 
the quality of their water. Everybody here on the dais and in 
the audience and probably across this great country are just as 
invested in water quality and clean drinking water as the next 
person.
    But what we found in a State like West Virginia is, we 
exert our right under the 401, and we get sued by other 
external groups to try to prevent the direction that we want to 
go. Maybe that is not the direction that Washington State wants 
to go, but it is the direction that we as West Virginians want 
to go, and so that is very frustrating.
    So I guess in the grand scheme of things, to both 
Governors, does this legislation in any way prevent you from 
continuing to ensure water quality consistent with the Clean 
Water Act?
    Mr. Gordon. Mr. Chairman, Senator Capito, I do not believe 
it does. As I say, I have extensive experience with the State's 
regulatory apparatus, having served on the environmental 
quality council and having actually prosecuted several examples 
of these permits being issued and being contested. Never did I 
see the State's opportunity to regulate appropriately 
interfered with.
    As I have mentioned before, I think States have multiple 
rights, and one of them is certainly the right to commerce. 
That, I think, is something being precluded as we see the creep 
of 401 to include other things.
    Senator Capito. Governor Stitt, do you have a comment on 
that?
    Mr. Stitt. No, I do not think it limits our ability as a 
State to regulate our water quality. I just want to address the 
States' rights issue. Today, we are talking about pipelines, 
and we are talking about exporting coal. But tomorrow, it may 
be exporting agricultural goods, or it might be exporting beef. 
I think that is exactly----
    Senator Capito. We might be exporting energy generated by a 
solar panel.
    Mr. Stitt. It could be, that is correct. We could. I think 
we have talked enough here, we are so proud of Oklahoma being 
the pipeline capital of the world, and yet we have given you 
the facts on our water quality. This is really an attack on 
States' rights to be able to export their assets, and that is 
where one State's rights, where does it impinge on another 
State?
    Senator Capito. Right. As Governor, obviously you have 
stated the robust production of natural gas and oil. My State 
of West Virginia is new to the natural oil. We are not new to 
the natural gas business, but we are new to the proliferation 
through the Marcellus and Utica Shale. I think it is rather 
ironic that we have two major pipelines now stopped because of 
permitting issues.
    But we also look where we are situated in this country, 
where we could be exporting our gas to New York State and to 
the Northeast to replace what I think is one of the dirtiest 
fuels around, and that is fuel oil. I am not sure that we are 
into genuine arguments here in terms of how to weigh the cost 
and benefit environmentally and also economically at the same 
time.
    I don't know, Governor, if you had a comment on that.
    Mr. Stitt. I think that is exactly right. The hypocrisy of 
having a Russian oil tanker sitting in the Boston Harbor, 
transporting oil and natural gas----
    Senator Capito. It had been to Tobago, too. Remember, it 
came down from London to Tobago, and back up to Boston. How 
much carbon footprint is that?
    Mr. Stitt. That is right. Transporting oil and natural gas 
through pipelines is the safest way to do it, versus truck or 
train or obviously by ship. We love it. We think it is the 
right thing, and this is just about time and scope and clarity 
around 401. That is why we are supportive.
    Senator Capito. Thank you.
    Senator Barrasso. Thank you, Senator Capito.
    Senator Merkley.
    Senator Merkley. Thank you, Mr. Chairman.
    Ms. Watson, how many years did it take for the design to be 
developed for the Millennium Coal Terminal?
    Ms. Watson. That was, of course, several years in the 
making, Senator, and I am not sure that the designs are 
completed yet.
    Senator Merkley. So it took many, many years for the 
company to figure out how it has going to address different 
issues, design the details. In that context, do you feel it was 
unreasonable for the State to only have a few days to be able 
to evaluate a design that took many years, and as you have just 
mentioned, isn't actually complete yet?
    Ms. Watson. Yes, absolutely, Senator. One of the problems 
in particular with that project is the company did not come 
forward with sufficient information to show how it was going to 
mitigate against water quality impacts, even at that point.
    Senator Merkley. So you had to do an evaluation based on 
not even the company willing to provide the information?
    Ms. Watson. That is correct; that was the problem.
    Senator Merkley. I understand you have had 11 quality based 
reasons or concerns that you were expressing, and the company 
never bothered to basically lay out how it was going to address 
these 11 issues.
    Ms. Watson. That is correct, Senator. The company did not 
come forward with information showing how it would prevent 
those water quality issues.
    Senator Merkley. Governor Gordon, do you think it is 
reasonable that you as a Governor should have to respond to the 
company that is not going to give you the information that you 
need?
    Mr. Gordon. Thank you, Mr. Chairman, Senator Markey. I 
think your question is----
    Senator Merkley. Senator Markey isn't here, but I am here, 
and I would like to hear your response.
    Mr. Gordon. I am sorry. Pardon me.
    Senator Barrasso. People confuse Markey and Merkley all the 
time. It's like Crapo and Carper. We have the same thing.
    [Laughter.]
    Mr. Gordon. Senator Merkley, thank you. Your question is 
about reasonableness of a short time scale.
    Senator Merkley. No, it is trying to respond the way that 
the power that has been delegated to your State when the 
company hasn't provided the basic information that you need.
    You don't need to give me a lengthy response. I would think 
any Governor would be concerned. If you are not concerned, I 
think many other Governors would be concerned about having to 
respond when they haven't gotten the basic information.
    Mr. Gordon. Senator Merkley, if I may respond.
    Senator Merkley. You have to be very quick.
    Mr. Gordon. I think the issue is that the Millennium Bulk 
Terminal actually presented information from Centralia, 
Washington, on Hanford Creek had exactly the same condition, 
very similar, and presented their water quality information, 
which was approved in 2016, 1 year before the prejudicial 
dismissal.
    Senator Merkley. Let me turn to an Oregon project that was 
mentioned. That is the LNG potential terminal in Coos Bay, 
Oregon.
    The pipeline crosses 485 bodies of water, 7 lakes, 326 
waterways, 150 wetlands. I can't see how the State of Oregon 
can even get out to look at the plans for those locations in 60 
days.
    These things vary so much. You might have a permit that 
requires crossing one creek, or near one lake. But in this 
case, you are talking about, well, close to 500 bodies of 
water, an extraordinarily complex undertaking.
    Do you think 60 days is reasonable for the State to be able 
to even get out and identify and evaluate the concerns for 
water quality in all those locations?
    Mr. Gordon. Is that question for me?
    Senator Merkley. Yes.
    Mr. Gordon. Sixty days is probably unreasonable. One year 
is certainly reasonable, and I think with pre-consultation, 
there is plenty of opportunity for getting that information 
correct.
    Senator Merkley. OK. Well, thank you for your perspective. 
It looks very different to the State where the impacts are 
going to be on the ground. Our citizens want a thorough 
evaluation of the impacts.
    We value our trout, we value our salmon, we value our 
crabbing industry, we value our salmon industry. We value all 
of our offshore activities that are affected, as well as our 
instate waterways affected by the pipeline.
    I was very struck by, when the law was initially written, 
there was a bipartisan consensus, and it said it right in it, 
that this recognizes the primary responsibility of the States. 
This has all the earmarks of an assault on State rights with 
the heavy hand of Federal Government and Federal lobbying. I 
for one am going to stand up for the people of my State, defend 
their waterways, and especially when the company won't even 
provide the basic information needed to evaluate it.
    These projects involve trenching, blasting, drilling, 
damming, and 500 or so waterways impacted. There is no way that 
that can be done in such a short period of time. There is no 
way it can be done when the company doesn't even provide the 
basic information to begin with.
    So with that, I stand with the people of Oregon, who want 
to defend their waterways, and it looks very different, 
perhaps, than the perspective on your end of the project.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you, Senator Merkley.
    Senator Cramer.
    Senator Cramer. Thank you, Mr. Chairman.
    Thanks all of you. I have never confused for Senator 
Merkley or Markey, although just now, someone could be confused 
because I think what you are hearing from the two sides of the 
dais get right to your point, Governor Gordon. We have to find 
balance, identify scope and creep, and I think we are all 
trying to do exactly that: find balance.
    What is that balance between the State's right to its own 
environmental protections and its resources, and a State's 
right to access to interstate commerce and global commerce?
    I come from North Dakota, a State like yours, where we are 
landlocked, right in the center of the North American 
continent, and are rich in resources that the country and the 
world wants and needs. Striking the balance, I think is what 
the bill does.
    One of the things that strikes me, and I am just going to 
opine for a minute, because listening to all this has been 
fascinating and encouraging. I hope people watching it are 
encouraged to see an intellectual discussion of peers and 
experts about, what is the right balance, because I am 
encouraged by it.
    When Congress isn't very prescriptive, it allows the 
bureaucracy to write the rules, and that almost never turns out 
well, from my perspective. It doesn't protect States' rights 
either to regulate themselves or their resources in order to 
interstate commerce. So I appreciate us coming back to the 
scope of 401, what that means, what that section provides in 
terms of clarity or lack thereof in authority.
    I am going to get back to the Millennium Project, because I 
think it is an interesting one, because it has similar to 
issues that we in North Dakota have had with the State of 
Washington's zeal, if you will. So in regard to the Millennium 
Project, the State of Washington denied the 401 permit, despite 
the State's own EIS, which stated ``there would be no 
unavoidable and significant adverse environmental impacts on 
water quality.'' That is the State's EIS.
    So it was not a surprise, in my view, considering that the 
proposed terminal was only a few miles from the existing Port 
of Longview, and that moves millions of tons of cargo, as you 
know, each year. But I thought it interesting the State of 
Washington proceeded to deny the water quality certification 
under Section 401 for nine reasons that had nothing to do with 
water quality. It doesn't mention water, and some of them, it 
is a very far stretch.
    So, Governors first, both of you oversee DEQs, both of you 
have spoken a little bit to this, but when you get a DEQ 
permit, and of course, you have great experience in this, or a 
401 permit application, do you consider a lot of things outside 
of water quality?
    And maybe start with you, Governor Stitt, since you have 
the background in this.
    Mr. Stitt. We look, if there's endangered species, we look 
at that. We look at the groundwater, we look at any kind of 
impact. We look at the maps, we look at the scope of the 
project. We make sure that it complies with the Clean Water Act 
and our own State water standards. But we keep it to--we don't 
try to play pick winners and losers, we try to keep with the 
Clean Water Act, and move it forward.
    Like I said, we do that in 60 days, so putting parameters 
of 1 year, we think, is very reasonable to bring the scope, 
which you said very well, back to the real issue of 401, which 
is water quality in the State.
    Senator Cramer. Governor Gordon.
    Mr. Gordon. Mr. Chairman, Senator Cramer, I think you are 
absolutely on point. As I was thinking about this and a similar 
opportunity that Wyoming might be presented with, Wyoming is 
the home of the largest wind farm in the country. That wind 
farm is going to require a stormwater quality permit. The 
customers for that wind farm are going to be all over the 
Southwest, and including Oregon.
    If we were to fancifully apply 401 as Washington did, we 
might deny a stormwater quality permit with prejudice for the 
wind farm with the idea of saying that we are not going to 
supply customers in the West.
    Of course, we wouldn't do that, because we would work with 
the proponents of the wind farm to make sure that the water 
quality impacts were addressed, only the water quality impacts.
    Senator Cramer. With regard to moving oil, for example, 
Governor Stitt, North Dakota is, of course, the second largest 
oil producing State in the country, farther from markets, even, 
than Oklahoma. But your neighbors, your port neighbors, include 
Texas and Louisiana. Do you see a difference in how they apply 
401 to, say, a State like Washington or Oregon that may apply 
it differently? Does it make sense that we would have a little 
more of a uniform application?
    Mr. Stitt. We believe so. Obviously, there are pipelines 
running through Oklahoma, from your State down to our State. We 
are the southern leg of the Keystone. We have access to 
Louisiana. We are building natural gas pipelines to transport 
LNG down to the ports in Louisiana.
    Obviously, we have direct access to the Houston refineries. 
So I think Texas and Louisiana are interpreting the rule 
properly. They are following their water standards just like we 
ask every State to do. This is really about making sure that we 
don't let certain States politicize this issue for their own 
biases, and then harm the assets of one State. That is really 
what it is about.
    Senator Cramer. We think of it as weaponizing.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you very much.
    Senator Van Hollen.
    Senator Van Hollen. Thank you, all of you, for your 
testimony here today.
    Senator Cardin also comes from my State of Maryland, and he 
covers some of the territory I mentioned.
    We recently had a back and forth in Maryland with Exelon 
Company regarding the Conowingo Dam, which is a dam on the 
Susquehanna River. I believe that if the EPA knew proposed 
regulations were in place or this legislation were in place, 
the State of Maryland would not have been able to reach the 
agreement it did with Exelon, putting aside the merits of that 
particular agreement, because this legislation would have 
undermined the State's leverage in that negotiation.
    That is not just my view. That is also the view of the 
State of Maryland's Secretary of Environment, Ben Grumbles, 
Secretary of Environment to our Republican Governor, Governor 
Larry Hogan. Secretary Grumbles says the Maryland Department of 
Environment believes that Maryland's program could be further 
hindered by the proposed rules, similarly, the legislation.
    Ms. Watson, one of the issues that he raised, Secretary 
Grumbles, regarded the change in the definition of discharge. 
Could you talk about that in this context?
    As Secretary Grumbles points out in this letter, CWA 
Section 401 requires certification for any federally permitted 
activity that may result in a discharge to navigable waters. 
While it is well established that the term discharge is broader 
than the term point source, the proposed rule limits State 
certification review to discharges from a point source.
    Could you elaborate on that concern and talk about how that 
would impede States like the State of Maryland from taking 
action to protect our water bodies, including the Chesapeake 
Bay?
    Ms. Watson. Yes. Thank you for your question, Senator. As 
things stand now and as they have stood for the last 50 years, 
States have been able to look at the entire federally permitted 
activity to make sure that the activity will not cause water 
pollution. The U.S. Supreme Court affirmed that understanding 
in the 1994 case PUD No. 1.
    So that has been the way States have implemented 401 for 
the last 50 years. EPA is not proposing to do, and what this 
legislation would do, is skinny down what States can actually 
look at, so that you are looking at just a very narrow 
discharge into a navigable water.
    States couldn't protect their groundwater. States couldn't 
protect from construction stormwater. States couldn't protect 
with sedimentation standards, with erosion standards, for 
Endangered Species Act standards, couldn't protect tribal 
fishing access.
    So there are all kinds of water quality protections that 
are protected today and have been for the last 50 years that 
would be on the chopping block as a result of this rule.
    Senator Van Hollen. I appreciate that, and that is exactly 
what gave rise to this concern.
    Just to the Governors, you heard the concerns expressed. 
Would you like to change the regulation so that you could no 
longer use your permitting authority for groundwater 
protection, sediment issues, and the other issues that were 
raised by the other witness?
    Mr. Gordon. Mr. Chairman, Senator, I don't believe that is 
what is in front of us today. I would read that differently.
    I can't speak to the case of Maryland. I am from Wyoming, 
but having served in a regulatory capacity for the State prior 
to being treasurer and now Governor, and having been a citizen 
who has worked on these issues since the 1980s, I have to say I 
don't see this as any diminishment of the States' opportunity 
to regulate waters within its boundaries.
    I do see it as a creep to take in issues like rail safety, 
greenhouse gas emissions, noise, that are not pertinent to 
water quality issues.
    Senator Van Hollen. So you would have no objection then, to 
amend the legislation in a way that made crystal clear that 
nothing about this changed a State's ability to regulate 
discharges? You would support that?
    Mr. Gordon. Mr. Chairman, Senator, I believe the Clean 
Water Act was about protecting water, and the 401 provision of 
that Act allowed States to control the water within their 
boundaries.
    Senator Van Hollen. So you don't think that this new 
proposal or this legislation impacts that in any way? You don't 
believe that?
    Mr. Gordon. I think it narrows it and recenters it on the 
issue of water quality and allows States the opportunity to 
regulate those.
    Senator Van Hollen. So you disagree with the testimony. But 
if clarification was required, then you would support that, 
right, to not diminish that State's authority?
    Mr. Gordon. I would, clarification, I believe, is in order. 
I would hope it doesn't diminish the State's authority.
    Senator Van Hollen. I mean, you can understand there's a 
little confusion here, because States usually want to have 
authority to fully protect their waters and their environment. 
Yet this proposal essentially gives the Federal Government 
ultimate veto and decisionmaking authority and ability to 
second guess Governors, and you are OK with that, I take it?
    Mr. Gordon. Mr. Chairman, Senator, I believe States have 
authority to regulate waters within their boundaries. That I 
stated emphatically over and over again. I also believe that 
States have a constitutional right to conduct commerce, and if 
other States use that tool, the 401 permit, to impede the 
commerce of other States, then I think that is 
unconstitutional.
    Senator Van Hollen. There's obviously a fundamental 
disagreement as to what this regulation and legislation does, 
and it seems to me that if there's that much ambiguity, that 
before we proceed in either way, we would want to make it very 
clear what the impact is. I hope we can all agree on that.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you very much.
    Senator Sullivan.
    Senator Sullivan. Thank you, Mr. Chairman, and I want to 
thank the witnesses for their testimony and being here on an 
important issue, certainly an important issue.
    In my State, the great State of Alaska, we have 
successfully run a Section 401 program for quite some time.
    But I want to go into the question, particularly for our 
two Governors, who have a lot of experience in this area, where 
there seems to be kind of a movement to focus on stopping 
projects from moving forward not based on clean water, but 
really trying to delay or kill a class of projects. In 
particular, something that matters to my State, I think it 
matters to your States, are pipelines.
    Kind of ironic, because the modern day pipelines--Keystone 
for example--created this hysteria when we all know that the 
studies show that it is actually much more safe to move energy 
products via pipeline than it is via rail. Yet for some reason, 
certain States have really focused, not again on clean water 
authority, but just a class of projects, pipelines, to kill 
them.
    Let me just give you examples I am sure you are familiar 
with. The Constitution Pipeline in New York--prime example--
where the Governor of New York is impoverishing his own 
citizens by delaying any ability to move natural gas across the 
State. The U.S. Chamber estimated that the delays to that 
project is close to $4 billion in economic output and close to 
24,000 jobs. So, that seems, to me, an issue.
    Similarly, in Massachusetts, the unwillingness to permit a 
pipeline for natural gas has created the ironic situation 
where, as opposed to people in New England having gas from 
Americans, American gas, by American workers, they are 
importing LNG from Russia, our geopolitical foe that trashes 
the environment when they produce gas.
    But there you have it, two examples of Section 401 that are 
not focused at all, in my view, on protecting the water, but 
some kind of fundamental, irrational, in my view, opposition to 
a class of projects, in this case, pipelines.
    Can you two, both the Governors, expand upon this, or just 
give us any insights on how we should look to prevent this kind 
of focusing on just projects themselves, a class of projects, 
versus the intent, which is to make sure all States have clean 
water and clean air?
    In my State, we care more about our water and air than 
anybody, than anybody in the EPA, anybody. And by the way, we 
have some of the cleanest water and cleanest air in the world. 
We care about that.
    But this movement toward blocking things, it really hurt 
the whole country, not just their own States. I think it is 
something that Governors in particular can speak to, and I 
would welcome your views on that, and how we can look at 
Federal law to maybe prevent those kinds of approaches that 
really, these Governors are harming their own citizens, but 
they are harming the rest of the country as well.
    Mr. Stitt. I totally agree with you. I think that was very, 
very well said. First point I would like to add to that is that 
Oklahoma is--you missed it, you weren't here earlier, but we 
talked about we are the pipeline capital of the world. We have 
more pipelines running through Oklahoma actually surrounding--
--
    Senator Sullivan. And they are safe?
    Mr. Stitt. And they are safe. And we have some of the 
cleanest water, and I read those stats off earlier. It is the 
safest way to transport oil and natural gas.
    Senator Sullivan. Why do you think there is this reflexive 
approach to stopping pipelines? The Keystone Pipeline that the 
Obama administration delayed for 8 years killed countless, 
thousands, tens of thousands of jobs. It just makes no sense.
    Mr. Stitt. I think Oklahomans, or I think Americans need to 
understand what happened with the Russian tanker that was 
sitting in the Boston Harbor, trying to bring liquefied natural 
gas from Russia, exporting our tax dollars and our jobs over 
there. I think Americans need to understand what is happening.
    Senator Sullivan. By the way, the Boston Globe did I think 
a 3,000 page editorial, Mr. Chairman, I would like to get it 
for the record here, which really went into this in a damning 
way for the Massachusetts legislature and how irrational the 
policy was.
    Senator Barrasso. Without objection.
    [The referenced information follows:]
    
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    Senator Sullivan. Governor, continue.
    Mr. Stitt. I will read real quick our water quality and 
some of our air quality facts in Oklahoma, because if pipelines 
were the problem, these facts would not be accurate. We are No. 
1 in the Nation in phosphorus load reduction in 2018 in our 
water bodies. We are No. 3 in the Nation in nitrogen load 
reduction in 2018. We are No. 1 in the Nation for non-point 
source success stories with more water bodies delisted from the 
impaired list of any other State.
    Because of our natural gas generation, we are double the 
national average in our reduction of emissions. Double the 
national average. So, sulfur dioxide is down 56 percent since 
2011, nitrogen oxide is down by 69 percent since 2011, carbon 
dioxide is down 37 percent since 2011.
    So really, the issue is we are weaponizing, we are talking 
about, States are not talking about water quality, they are 
talking about their hatred for fossil energy, and that is 
really the issue. We need to bring time and scope around this 
issue, so assets of some States are not infringed upon by 
others.
    Senator Sullivan. Governor, do you want to comment real 
quick?
    I know we are running out of time, and I apologize, Mr. 
Chairman.
    Mr. Gordon. No, thank you, Mr. Chairman, Senator. No, I 
absolutely agree with my colleague from Oklahoma. This Act 
really centers it back on water quality. That is the issue that 
is at play here.
    Your question really went to classes of actions. The 
example that I gave before was really about if Wyoming were so 
inclined to, say, look, our wildlife is very important, it is 
going to affect our migration corridors, you are going to 
affect our calving populations on various animals. We believe 
that wind farms are an impediment to that, and the stormwater 
quality permit that we are going to give is now therefore in 
peril because of wildlife associated impacts. That has nothing 
to do with water, but it is tantamount to using it to say, we 
don't want wind development for our wildlife.
    What I think this Act does is to recenter the conversation, 
really, on water quality and the opportunity for States to 
operate within those parameters in their own boundaries.
    Senator Sullivan. Thank you.
    Senator Barrasso. Thank you.
    Before turning to Senator Carper, I would like to also 
introduce for the record an editorial similar to the one that 
you talked about, about the Boston Harbor. This was in 
yesterday's Wall Street Journal, and it is called Cuomo's 
Carbon Casualties, where they say the pipeline he vetoed, 
Governor Cuomo vetoed, below New York Harbor, could reduce 
annual CO2 emissions by the equivalent of 500,000 
cars on the road. His gas embargo is raising State emissions.
    Without objection I will introduce this into the record.
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    Senator Barrasso. Senator Carper.
    Senator Carper. I want to again, welcome, it was very nice 
meeting each of you. One of you, I have met previously, the 
Governor of Wyoming.
    But to Ms. Watson, Governor Gordon, and Governor Stitt, 
thank you all for joining us today.
    When I was privileged to be Governor of Delaware for 8 
years, I used to love to testify before Congress. Delaware was 
close by; it is an easy train ride. So I was an easy mark. The 
Governors Association, nobody wanted to come in from Wyoming or 
some other place, they would say, well, send Carper. I was 
always happy to go. I hope it is a good experience for you, and 
we welcome you.
    I think and speak a lot as a recovering Governor. I 
appreciate the opportunity here, especially from the three of 
you, and then from States regarding how they feel about 
proposals to alter State authorities under Section 401 of the 
Clean Water Act.
    I just want to thank our Governors for taking the time out 
of your schedules to share your views with us on what is an 
important topic, obviously, to your States, and I think to ours 
as well.
    I have a longer statement that I want to submit for the 
record. But I would like to take a minute, if I could, to 
reflect on the relationship between the Federal and State 
governments when it comes to clean water. To be honest with 
you, if I were a sitting Governor, instead of a recovering 
Governor, I would be uneasy about the prospects of changing 
that Federal-State relationship.
    On the one hand, the current Administration, my colleagues, 
on the other hand, on the other side of the dais, have great 
confidence in States' abilities to protect waters in their 
States, and want them to do more of it by making them 
responsible for managing additional bodies of water, as the 
proposed changes to the definitions of waters of the U.S. on 
the Clean Water Act would require them to do.
    However, when it comes to managing and maintaining the 
quality of water, some suggest that the rights reserved to 
States to protect water under the Clean Water Act should be 
changed. I think this distorted interpretation of cooperative 
federalism is not just ironic, it is actually pretty unpopular 
with the majority of States.
    I wonder if we are going to be able to reconcile that 
fundamentally contradicting approach to States' rights. We will 
see. But I am hopeful that today's hearing can shed some light 
on that subject.
    Next, I would just like to read, if I could, claims I think 
made by our friends on the other side of the aisle, and I am 
tempted to call them false claims, but I'll just say 
questionable claims, and I will pull my punch. But the State of 
Washington's action is about politics--this is a claim--that 
the State of Washington's actions about politics has nothing to 
do with clean water. The State of Washington's own 
environmental impact study for the project found that there 
would be no significant impacts to water quality. That is the 
claim.
    And here is a rebuttal. In its 401 submission, the 
Millennium Bulk Project failed to show that it would adequately 
mitigate for its water quality impacts. The environmental 
impact study did not conclude that there would be no impacts to 
water quality. Rather, the environmental impact study concluded 
that if the company demonstrated that it could meet all water 
quality requirements, then there would be no significant impact 
to water. But the company failed to make that demonstration.
    Mr. Chairman, I would ask unanimous consent to submit for 
the record the actual 401 determination which makes absolutely 
no reference to climate change and other impacts, just water 
quality effects. I make that unanimous consent request.
    Senator Barrasso. Without objection.
    [The referenced information was not received at time of 
print.]
    Senator Carper. Thank you.
    Here is another claim that I would characterize as 
misleading. ``And the State of Washington has abused its 
authority to block the export of coal mined in Wyoming, Utah, 
Colorado, and Montana.''
    The rebuttal to that from the State of Washington is the 
following: ``The State of Washington denied the water quality 
certification to the coal export terminal because it failed to 
demonstrate reasonable assurance that water quality 
requirements would be met.''
    The project's proponent has appealed Washington's decision. 
Every tribunal that has reviewed it has upheld Washington's 
decision.
    Mr. Chairman, I would ask unanimous consent to offer for 
the record a letter sent to you and to Ranking Member, me, 
Carper, on August 15th, 2018, from Maia Bellon, Director at 
Washington Department of Ecology, which states, ``The facts of 
this denial of the Millennium Coal Export Terminal are simple. 
Millennium failed to meet existing water quality standards, and 
further failed to provide any mitigation plan for the areas the 
project would devastate, especially along the Columbia River. 
To approve this permit under the circumstances would not only 
have been irresponsible, it would have posed serious health 
risks to impacted communities and the surrounding 
environment.''
    Senator Barrasso. Without objection.
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    Senator Carper. Thank you, sir.
    And finally, a question. This would be a question for our 
Governors, Governor Gordon and Governor Stitt.
    One of the most controversial pieces of the EPA's proposal 
is that Federal agencies would be able to veto or override 
State imposed water quality conditions. For the sake of 
argument, let's say that a State is reviewing an application 
for a hydroelectric dam, which could have serious impacts on 
ecologically and economically important fish and species.
    As a condition for the dam's 401 certification, the State 
environment department could require the project to implement 
fish passage measures to allow spawning fish to swim upstream. 
Under this new rule, the Federal agency permitting or licensing 
this project could decide this measure is too costly and veto 
this condition.
    And I would just ask a question of both of you, if I could, 
as Governors of States whose recreational fishing industries 
support, literally thousands--maybe tens of thousands--of jobs, 
and provides billions of dollars to States' economies, would 
you support such a Federal agency override of your efforts to 
protect recreational fishing?
    Governor Gordon. Want to take a shot at that?
    Mr. Gordon. Thank you, Mr. Chairman, Senator Carper. I 
would not support a Federal override. We are--and I am on the 
record stating that I do not believe a Federal override is a 
correct method.
    Senator Carper. Thank you.
    Governor Stitt.
    Mr. Stitt. I would agree with that. We want certainty. I 
think businesses want certainty, so we are looking at a time 
and scope around this proposed rule change, which we agree on.
    Senator Carper. All right.
    Thank you both, thank you, all three of you.
    [The prepared statement of Senator Carper follows:]
                  Statement of Hon. Thomas R. Carper, 
                U.S. Senator from the State of Delaware
    Mr. Chairman, we are here today to examine legislation that would 
restrict State authorities under Section 401 of the Clean Water Act.
    As a former and now ``recovering'' Governor, I understand the 
reasons a State would want to maximize the strength of its most 
important industries. And so, I understand the motivations behind the 
legislation you have authored, Mr. Chairman, as well as the statements 
of the two Governors sitting before us today.
    My hope is that all of us on both sides of the dais will similarly 
consider the concerns raised about both this legislation and EPA's 
proposed rule by the Governors, attorneys general, and environmental 
agencies of many other States, including both red and blue States.
    As I consider these reforms, some questions come to mind that are 
partly a legacy of my experience as a Governor:
      In addressing the needs of the industries in one State, what 
effect would the proposed cure have on neighboring States?
      Do other States perceive the same problems the Governors here 
today have articulated?
      How do the 45 tribes authorized to review permit applications on 
their lands feel about the proposed solutions?
    I ask these questions because in my State of Delaware, decisions 
made in the best interest of industries and States elsewhere have had 
dramatic effects on the environment, public health, and our quality of 
life.
    As I have described many times in this Committee, Delaware sits at 
the end of America's tailpipe. More than 90 percent of our State's air 
pollution flows from power plants upwind of our State.
    Despite many appeals from Delaware and other downwind States, 
unfortunately, neither the responsible States nor EPA have chosen to 
control those emissions.
    While I understand the economic motivations of those States, 
Delawareans are forced to endure poorer health and higher costs while 
upwind polluters enjoy economic benefit. That is not right.
    I would just ask my colleagues and our witnesses to imagine how 
they would feel if someone wanted to locate a power plant in the 
headwaters of that State's iconic cold water trout stream? Or perhaps a 
dam that would harm water quality, and as a consequence, critical 
wildlife and fisheries habitats? Would you want your State to have a 
say in whether and how that activity is conducted in your State?
    How would you feel about a Federal agency in Washington, DC, 
overruling the judgment of your own State officials regarding local 
impacts? Would you care if a Federal agency dismissed your concerns, 
told you that you had functionally waived your right to assess a 
project, and stormed ahead with a project that local citizens opposed 
because of local adverse impacts?
    These questions may seem hypothetical, but actually, they are the 
very real questions that Governors will face if EPA's proposed 
revisions to the 401 certification process become the law of the land. 
Indeed, they are the questions that Governors, attorneys general, State 
environmental directors, and a host of other concerned citizens are 
already facing now as they consider the proposed regulation.
    As a recovering Governor, I wonder what other States and tribes 
feel about the proposed changes. Apparently, President Trump was also 
interested in State and tribal input.
    In his April 16, 2019, Executive Order on Promoting Energy 
Infrastructure and Economic Growth, the President specifically called 
on EPA to, ``consult with States, tribes, and relevant executive 
departments and agencies in reviewing section 401 of the Clean Water 
Act and EPA's regulations and guidance.''
    As it turns out, however, States and tribes were either not 
effectively consulted or they were blatantly ignored. And from our 
analysis of the comments received on EPA's proposed 401 certification 
rule, States and tribes across the board really do not like it.
    More specifically, as this chart shows, 29 State environmental 
agencies and the District of Columbia expressed significant concerns 
with the proposed change to their authorities. These are not just 
Washington, New York, and others you might consider the usual suspects. 
As you can see here, Utah, South Dakota, Idaho, Arkansas, and others 
expressed substantial and heartfelt concern about the regulation.
    As you can see in this other chart, tribes are nearly unanimously 
opposed to what the Administration has proposed.
    While I can't do justice to all the concerns the States and tribes 
expressed, a comment from the State of South Dakota Department of 
Environment and Natural Resources struck me:

        ``Simply put, these proposed changes supplant the cooperative 
        federalism to protect water quality that has existed since 
        Congress passed the Federal Clean Water Act. These changes are 
        a poorly disguised effort by the Federal Government to severely 
        limit the States' and tribes' efforts to enforce their water 
        quality standards and to impose appropriate conditions on 
        federally issued permits.''

    Mr. Chairman, I understand the desire and mandate we have as 
elected officials to take care of our people and economies in our 
States.
    What I do not understand is why, in the process, we have to 
undermine other States' abilities to take care of themselves, their own 
citizens' welfare, their own natural environments, and their own local 
economic interests. That is what is proposed here. Not only is it 
wrong, it's also not our only option to address whatever real concerns 
these players have.
    In reality, denials of certifications by States are exceedingly 
rare. If one digs deeply enough into most of those denials, many of 
them occurred because the applicant did not give State officials the 
information necessary to determine whether the project would compromise 
the State's water quality and comply with State laws.
    As many States suggested in their comments on the proposed EPA 
rule, early engagement with State agencies and an honest portrayal of 
projects and their impacts makes it possible to resolve problems and 
secure certification. This is the way it works in virtually every one 
of the thousands of certifications that States provide each year.
    Granted, there are major projects that are so large, so disruptive, 
and so complex that they may never be appropriate for the environment 
for which they are proposed. A good example was a proposed deep water 
coal port in my State of Delaware that would have displaced some of the 
most beautiful and ecologically productive coastal marshes you will 
find anywhere. For very good reasons, our State determined that this 
location was not the right place for that kind of activity.
    Any and every State should have the right to make that 
determination for itself, accountable to its own citizens. That was the 
motivation of Congress when it gave States the important tool of 401 
certifications in the Clean Water Act--an authority that breathes life 
into the Act's promise of cooperative federalism. That, provided 
minimum Federal standards are met, States are in the best position to 
determine how to take care of their environments--much less their 
economies.
    As much as I know you, the majority witnesses, and some of my 
colleagues around this dais believe your legislation and EPA's proposed 
401 certification regulation are a good thing, I--and a majority of 
States in this union--disagree.
    We are debating a huge and dangerous solution to a very narrow 
problem affecting a very minute part of our society.
    This bill and that regulation are not the answer.
    Thank you, Mr. Chairman.

    Senator Barrasso. Thank you, Senator Carper.
    Before turning to Senator Gillibrand, I would first like to 
submit for the record a unanimous consent request to enter into 
the record a brief filed by the Crow Nation and the National 
Tribal Energy Association, and a number of associations, 
opposing the State of Washington's denial of the Millennium 
Bulk Terminal Project.
    I would also like to enter into the record the Millennium 
Bulk's response to the State of Washington's 2018 letter to the 
Committee, which we have just introduced into the record.
    Without objection, that will also be submitted.
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    Senator Barrasso. Senator Gillibrand.
    Senator Gillibrand. Thank you, Mr. Chairman, and Mr. 
Ranking Member.
    We hear a lot about States' rights, particularly from the 
current Administration. We are told that we should be leaving 
environmental regulations to the States, that they are in the 
best position to determine how to protect their environment and 
natural resources.
    We are also told that States--not the Federal Government--
should have the primary jurisdiction over regulating the 
majority of our water bodies, and that the Clean Water Act 
should be restricted to just traditionally navigable waters.
    But not surprisingly, when States use the authority legally 
delegated to them under the Clean Water Act to protect water 
quality, we hear from those same people that those States have 
somehow abused their power and must be reined in. That is 
absurd, and it undermines the foundation principle of 
cooperative federalism enshrined in the Clean Water Act.
    It seems that some policymakers are willing to throw the 
baby out with the bathwater and restrict the rights of all 
States under the Clean Water Act, simply because they disagree 
with the lawful decision of some States--including my own--to 
deny a very small number of permits.
    The Trump administration and Administrator Wheeler have 
explicitly said that they are proposing changes to the Section 
401 process because of New York's gas blockade. The 
Administration has cited three high profile denials by the 
State of water quality permits for interstate natural gas 
pipelines as an example of unnecessary delays.
    However, in each of those instances, the State's denial was 
based on relevant water quality standards and subject to 
judicial review. Additionally, New York State annually receives 
more than 4,000 applications for Section 401 water quality 
certifications, and on average, denies approximately 8. That 
means the State is approving more than 99 percent of the 
applications it receives every year on time. Hardly the picture 
of obstruction or an out of control State regulator.
    So what then is this really about? It is about removing a 
procedural block to establishing a more industry friendly 
regulatory process that gets meddlesome State regulators out of 
the way so that special interests can build what they want, 
where they want, even if it means harming water quality and 
running roughshod over principles of federalism they claim to 
support. This is bad policy, it is short sighted, and could 
have very damaging impacts in our States.
    With that, Ms. Watson, I have a couple questions for you. 
Under the Section 401 process, States can apply conditions on 
Federal permits and licenses to ensure that projects meet 
applicable State water quality requirements. However, the Trump 
administration's proposed rule would restrict the types of 
conditions that States can set and give Federal permitting 
agencies the authority to veto them.
    Could you describe the types of conditions that States 
might impose on a project that would not otherwise be included 
on a Federal permit? What impact will this have on wetlands, 
streams, and other water bodies impacted by the construction or 
operation of a project?
    Ms. Watson. So there are a lot of examples of conditions 
that States might include in 401 certifications to protect 
water quality that wouldn't otherwise be covered by the Federal 
permit example. So that would be protection of groundwater, 
sedimentation standards, erosion standards, best management 
practices for stormwater, protections for endangered species. 
These are things that get added through the 401 certification 
process that have routinely been included in Federal permits 
for the last 50 years without a problem.
    These are State based water quality requirements, and what 
is being proposed through the bill and through EPA's rule would 
upend that 50 year State control of water pollution in their 
States.
    Senator Gillibrand. What are the practical implications of 
reducing the amount of time that States have to make Section 
401 decisions? Will this result in more project approvals or 
improve water quality protection?
    Ms. Watson. It will not result in more water quality 
approvals. It will actually have the unintended consequence of 
resulting in more denials because States will not have 
sufficient time to make decisions.
    But on top of that, EPA is limiting the amount of 
information that States can consider. So States won't have the 
tools and the information necessary to be able to, in fact, 
protect water quality within their States.
    Senator Gillibrand. Thank you.
    I just wanted to respond to something our other witnesses 
said. Governor Gordon, I recognize that you want to be able to 
have the best economy for Wyoming. But the truth is, if you try 
to remove New York's regulatory authority, you will affect our 
economy, because our economy is based on clean air and clean 
water. We have agriculture all across New York that relies on 
clean air and clean water. We have a tourism industry that is 
very valuable.
    We have New York City, which is 8 million people, that gets 
clean water from a watershed, unfiltered water. If we had to 
filter that water, it would cost us tens of billions of 
dollars.
    So I just want to be clear. We know how to protect our 
State and our economy, and I would just suggest that you would 
give deference to our Governor in the way that our Governor 
would give deference to you in understanding what is best for 
your economy.
    And then Governor Stitt, I just was offended by your 
statements that you know how to have good water in Oklahoma. I 
would just like unanimous consent to submit four articles for 
the record of how challenged your water quality actually is in 
Oklahoma, which I am sure you are aware. I am grateful that you 
have made progress in eliminating some contaminants, and that 
is a good thing, but it may be because you are starting from a 
worse off place.
    Thank you, Mr. Chairman.
    Senator Barrasso. Thank you, Senator Gillibrand.
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    Senator Barrasso. Would any of you like to respond to the 
comments? And then we will just give each of you a chance to 
make a final statement as we wrap up the hearings.
    Mr. Gordon. Mr. Chairman, thank you for that opportunity.
    With apologies, Ranking Member, I think I have forgotten to 
recognize you the last couple of times. My apologies for that.
    Senator Gillibrand, thank you very much for your comments. 
I think we live in a Nation, that, going back to our 
Constitution, always has recognized the importance of the 
Federalist principles. If memory serves, one of the big 
arguments in the original documentation was whether New York 
would actually expand west beyond its normal boundaries that we 
perceive today.
    So I very much appreciate it. I have a daughter who 
actually is a beneficiary of that great, clean water.
    Wyoming has the largest amount of class one water in the 
country--excuse me, class one air in the country, and yet we 
are affected continually by pollution from Seattle, from 
Portland, from San Francisco, et cetera. I think we have to 
recognize these principles, and I think my point here is that 
together, focusing on water quality and our ability to regulate 
within the State, that is critical.
    When that is used as an impediment to commerce, that is a 
constitutional issue, and I think this particular Act that is 
contemplated actually recenters that conversation on what the 
original intent of the 1972 law was, which was to protect water 
quality.
    Thank you very much.
    Senator Barrasso. Governor Stitt, and then Ms. Watson.
    Mr. Stitt. Thank you, Chairman.
    I think, Senator, if the American people, if you think that 
the American people don't know really what is happening when 
your Governor denies permits based on 401 water quality on 
Earth Day, on pipeline development, I think American people see 
right through that.
    I think this is about a hatred of the fossil fuel industry. 
It has nothing to do with water quality.
    Senator Barrasso. Ms. Watson, any final comment?
    Thank you.
    Well, I thank all of you. We had 16 Senators show up for 
this hearing today, 11 had a chance to ask questions, 5 due to 
other commitments had to leave before it was their turn, so 
this has quite a bit of interest. Some of the other members may 
submit written questions for part of the record.
    I am very grateful for all of you being here.
    The hearing record will remain open for an additional 2 
weeks, but I want to thank all of our witnesses for their 
testimony today on this very important topic, and the hearing 
is adjourned.
    Senator Carper. Mr. Chairman, before we adjourn, could I 
just make several unanimous consent requests, please? I want to 
submit for the record a letter dated November 18th from the 
Council of State Governments.
    Senator Barrasso. Without objection.
    [The referenced information was not received at time of 
print.]
    Senator Carper. Another from the State of Washington, dated 
September 26th, 2017.
    Senator Barrasso. Without objection.
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    Senator Carper. A third from the American Rivers Connect 
the U.S. to the letter dated November 18th, 2019.
    Senator Barrasso. Without objection.
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    Senator Carper. A fourth from the Appalachian Trail 
Conservancy dated November 19th this year.
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    Senator Carper. And the last thing I want to say is, I 
think all of us are guided by the Golden Rule, whether we think 
about it or not. We should treat one another the same. I always 
try to put myself in the shoes of other people and say, how 
would I want to be treated if I were in their case, right?
    I know how important the economy of my State is to me, and 
I am sure the same is true for our Chairman.
    I live in a little State, we are the 49th largest State, so 
we are a small State.
    My State is sinking, and the seas around us are rising. It 
is, as you might imagine, a huge concern for us.
    There's widespread belief that one of the reasons why it 
has happening--I am a native of West Virginia; my dad was a 
coal miner for a while. My neighbors were coal miners, so we 
have to understand what it has like to be in the fossil fuel 
industry, if you will.
    But I would just ask that we try to put ourselves in your 
shoes as you attempt to govern your States, but I want you to 
put yourself in our shoes. When I was Governor of Delaware, I 
could shut down my State's economy, literally get every car or 
vehicle off the road, shut down every business, we would still 
have been out of compliance for clean air.
    So just keep that in mind as we go forward, and again, 
thank you all for being here.
    Senator Barrasso. Thank you, Senator Carper, and with that, 
thank you again for being here; the hearing is adjourned.
    [Whereupon, at 11:49 a.m., the hearing was concluded.]
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