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Congressman Greg Walden's Oregon Congressional Connection

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Congressman Greg Walden's Oregon Congressional Connection

Dear fellow Oregonian,

Congress reconvenes today and I began my 350th roundtrip to our nation's capital. While I enjoyed the time in Oregon and the dozens of meetings and community gatherings, with the problems facing the nation, I do think Congress should have cut short the August district work period and gotten more of its work done in the capital city.

Here's the problem: not a single appropriations bill, to fund a single federal agency, has gotten to the President. The federal fiscal year ends in 22 days. The most basic responsibility of Congress is to enact a budget. This Congress has a lot to do in short order.

Speaking of which, probably no issue needs thoughtful congressional action like moving America toward a more independent energy position. Gasoline, diesel and other energy costs are causing real hardships for American families, businesses, farms and ranches. When it costs $80 or more to fill the soccer mom's van, away games for families become too costly. It's time to pass comprehensive legislation that allows us to access America's great energy reserves, and use the proceeds to invest in long term alternative energy development, conservation and new technologies. My Security and Energy for America (SEA Act) would do just that, and fund five years of county timber payments, too. (Learn more about it by clicking here.)

When you see the volatility of the Middle East and the recent aggression by Russia to control energy, it's clear our national security as well as our economic security requires America to become more energy independent. We have great domestic potential for oil and gas, and for new clean coal technology, not to mention advances in geothermal, wind and solar energy. While I'd wager the Northwest leads the nation in conservation, we can always do more in that category, too. We need to do it all.

FORESTS, FIRES AND TRAGEDY

In the West, we've once again seen the devastating effects of wildfires: destruction of forests, homes, habitat and watersheds, smoke-filled airsheds, and the tragic loss of some of the Second District's bravest wildland firefighters when the helicopter they were in crashed on a hillside in California.

Thousands turned out last month for the public memorial service at the Jackson County Fairgrounds to honor those who lost their lives in the Iron 44 fire, those who survived the crash, and the loved ones left behind. It was a moving tribute to these men and the work they undertook to protect watersheds, airsheds, forests, and communities from wildfire. We owe Shawn Blazer, Scott Charlson, Edrik Gomez, Matt Hammer, Jim Ramage, Steven "Caleb" Renno, Bryan Rich, Roark Schwanenberg, and David Steele our eternal thanks. Please keep them and their loved ones in your prayers.

Meanwhile, this summer's fire season is causing budgetary hardship all across the Forest Service and it's time for Congress to take corrective action on two fronts. Let me deal with the budget issue, then I'll discuss my latest bipartisan legislative effort to build on the successes of the Healthy Forests Restoration Act.

A few weeks ago, the Chief of the Forest Service began pulling funds from all kinds of Forest Service activities to find money to pay for the immediate costs of fighting wildfires. During meetings I held in John Day and Baker City, I talked with people who had contracts to reduce the fuel loads in the forest. Their work was put on hold. I'm sure you've seen the stories of closed campgrounds, and nearly all other work of the agency coming to a halt. The Chief has asked the agency to find up to $400 million that can be spent on fire fighting. I'm sorry, but this is nuts.

We need a separate account for fighting fire. Legislation I'm cosponsoring that passed the House would lead us toward that end and put a stop to the raiding of accounts each summer that only sets us further behind in doing the fuels reduction work and maintenance that is so necessary. I hope the Senate will take action on the FLAME Act before Congress adjourns at the end of this month. This is a no-brainer.

Second, Congress needs to expand the Healthy Forests Restoration Act (HFRA) to give the Forest Service the same authority to reduce fuel loads and improve forest health deeper in the woods as it has right around our communities. HFRA has proven a success at building collaborative relationships in our communities to advance fuels reduction projects, improve forest health and reduce the threat of wildfire.

Forestry officials came to me last spring and asked for this help so that they can work on those federal forest lands most at risk from high fuel loads, bug infestations and drought. In other words, they want to get ahead of the problem by working on a landscape basis deep in the forests where the fires start.

Since then, I've worked with colleagues on both sides of the aisle and have written the Healthy Forest Restoration Act II (H.R. 6787). It's a simple expansion of a proven process that reduces costs and gets the work done. I'd much rather invest in forest health improvements than every year shell out more and more to fight worse and worse fires. You can find out the specifics of the bill here.

Actively managed forests that are resistant to insects and disease could lead to a 50 to 60 percent reduction in acres burned due to wildfire; this would equate to a reduction of at least one million tons of greenhouse gas emissions annually in California alone. According to the U.S. Environmental Protection Agency, managed forests in the U.S. currently remove the greenhouse gasses emitted by 235 million cars annually.

It's time to change federal forest management policy…while we still have forests to manage.

WATER, IRRIGATION AND MORE

When I was elected to succeed Congressman Bob Smith, he said: "Greg, one word will dominate much of what you do in this office: water." And Bob was right.

During the break, I held many meetings on water issues. In central Oregon, I met with representatives of the Central Oregon Irrigation District, North Unit irrigation District, Tumalo Irrigation District, Three Sisters Irrigation District, Ochoco Irrigation District and the Deschutes Basin Board of Control. Over the years, we've worked together to find solutions that mean guaranteed water for farmers and more water for fish needs.

Right now, they're working with other parties on a proposed Habitat Conservation Plan (HCP) for steelhead and bull trout. Steelhead were reintroduced into Whychus Creek and the Crooked River this year as part of the settlement agreement for the Pelton Round Butte Hydroelectric Project. The HCP process is a difficult one, but things are going well as the 45 (yes 45) different groups work on the effort. Much work remains to bolster the scientific understanding of the Deschutes Basin, and to undertake conservation planning, among other efforts.

On the legislative front, we did succeed in getting the Oregon Water Resources Act into law this year. Among other things, it reauthorizes the Deschutes Resource Conservation Act. This law has helped bring together divergent groups in the Basin to find consensus and funding for water conservation measures.

The new law also amends a repayment contract between the Department of the Interior and the North Unit Irrigation District that allows NUID to meet state water conservation law and to improve its overall water management and repay its capital costs sooner. It's one of the only contracts actually in federal law. Our measure puts an end to that and allows the Secretary of the Interior to negotiate future contract terms (this was at the request of the irrigation district).

I continue to hold out hope that our Tumalo Water Conservation Project Act (H.R. 496) will get action by the House Natural Resources Committee before Congress adjourns. The bill received a hearing last year, but the Committee leadership has not taken any further action, despite repeated requests. It's hard to understand why. After all, this measure would continue our efforts to pipe canals — six miles in this case — and return 20 cubic feet per second of conserved water to in-stream flows in the Deschutes River. A similar measure has passed out of committee in the Senate and awaits floor action.

I also held meetings to discuss irrigation and water issues in the Klamath Basin, where work continues on a complicated and controversial settlement agreement. The Administration has worked tirelessly with local parties for years to find a solution to the water conflicts and needs in that Basin. I've not talked to anyone associated with the proposed settlement agreement that is excited or happy about every aspect of it, but most parties tell me the alternative of no long-term settlement is worse. Meanwhile, the work continues.

Elsewhere, in the Umatilla Basin progress continues on the various enhancements to water flows and habitat restoration while work continues to figure out ways to augment water storage.

Finally, irrigation districts in and around Mt. Hood raised concerns about maintaining their access to water supplies if the new Oregon Treasures wilderness proposal gets enacted. Unlike the legislation I co-authored with Rep. Earl Blumenauer two years ago, his new legislation (co-authored by Rep. Peter De-Fazio) fails to include the certainty in statute that I, and the irrigation district managers, want and need. I want to make sure that if a creek changes course, as often happens on Mt. Hood, or we get another blow out, like occurred in November of 2006, that these irrigation districts can re-channel the creek and fix their intakes. It wouldn't take much to spell that out in law, rather than run the risk of losing their access to water.

The House Natural Resources Committee is scheduled to hold its first hearing on the Oregon Treasures bill on September 11. I've shared my concerns about the water issues (and numerous other concerns that stakeholders have brought my way) with Rep. Blumenauer. Hopefully, he will address them in his legislation.

FANNIE, FREDDIE AND YOU

Both Fannie and Freddie were chartered by Congress (Fannie in 1970 and Freddie in the late 1930s) with the goal of promoting homeownership by enhancing the supply of residential mortgage funding. While they are "government sponsored enterprises," or GSEs, they are shareholder-owned, for-profit companies whose operations are fully funded by private capital sources, but whose risk is backed by the federal government.

In addition to purchasing mortgages from banks, and then packaging them into financial securities that are sold to investors in a secondary market, Fannie and Freddie developed a second line of business.

They purchased assets (mainly mortgage-backed securities or whole mortgages) for their own investment portfolios to deliver profits to their private shareholders. The investment portfolios were fueled by the borrowing that Fannie and Freddie did — and they borrowed at a preferential rate because they had the implied backing of the federal government (that's you, the taxpayer). If they got into financial trouble it was assumed (and rightly so) that the federal government would step in to make good on the debt. Investors rewarded Fannie and Freddie for this implied government backing by granting them a lower interest rate on their debt. This system turned into a money-making machine for Fannie and Freddie, and their private shareholders.

Since 1990, combined investment portfolios for the two have grown tenfold, from $135 billion to $1.4 trillion as of late 2007.

According to the Congressional Budget Office, the "implied subsidy" from the federal government to the GSEs amounts to about $23 billion per year (latest estimate was 2003). At that time, the CBO found that slightly more than half of this sum got passed on to mortgage borrowers in the form of lower interest rates. The other half? It was simply retained by the GSE executives and shareholders.

Once the music stopped in the housing market and foreclosures rates began to soar, the "implied backing" of the Federal government became more than implied. And this weekend we learned that the Treasury Secretary has moved to take over both GSEs and replace their top management. We'll learn more in the coming days about the hit taxpayers will take under this plan and the impact all of this mess has on both the broader financial markets and on the mortgage markets.

If there were every poster children for reform and oversight, it's Fannie and Freddie.

A FINAL NOTE

During the August break, I covered about 2,000 miles in the district, held about three-dozen meetings and visited about half of the counties. I heard a lot about how the energy crisis is affecting folks in Oregon. In an especially informative meeting in Grants Pass, local government and business leaders told me just how much of an impact higher prices are having. For example, Three Rivers School District saw their fuel costs escalate by $370,000 between 2006 and 2007, and the price of a carton of milk in the school cafeteria has jumped 50 percent.

September and October are already filled up with meetings and events and by the end of October I will have again completed my effort to get to each county at least twice a year (some I've reached many more times). We have a lot going on in this district, and when more than half of it is under federal control, there's never a dull moment. I enjoy the opportunity to hear what's working, what's not, and to work on solutions to the everyday problems we face out here.

That's all for now. If you would like to unsubscribe from this mailing, simply reply and type the word "unsubscribe" in the subject box.

Best regards,
Greg Walden
Member of Congress


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