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Senate Commerce, Science And Transportation Committee Hearing - The Nomination Of Former Rep. Ray LaHood To Be Secretary Of Transportation

Chaired By: Senator Daniel Inouye

Witness: The Nominee Testifies

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SEN. ROCKEFELLER: (Sounds gavel.) The committee will come to -- hearing will come to order. I want to start out my chairmanship by yielding to John Kerry who has a 30-minute -- maybe 30-hour or 30- second announcement he wants to make.

SEN. JOHN KERRY (D-MA): Thank you very much, Mr. Chairman, I appreciate the privilege. I'm managing the nomination on the floor, so I need to leave.

I just wanted to welcome you as chairman. We're delighted that you're going to be taking the helm of this committee. We know your passion for all of the issues in front of the committee. And, just personally, as somebody who's shared this journey with you on the committee, I'm delighted that you've taken on the gavel, and we look forward to your leadership. It's good to be here with you.

I want to welcome our new senators also. It's great to have all of them here. And I would ask unanimous consent that my full statement will be placed in the record as if read in full.

SEN. ROCKEFELLER: And so be it.

SEN. KERRY: And I look forward to supporting your nomination, Congressman. We reached our agreements over lunch yesterday after the inauguration, but I really look forward to your stewardship there. Thanks.

Thank you, Mr. Chairman.

SEN. ROCKEFELLER: Thank you, Senator Kerry.

And, obviously, I want to welcome everyone to the first session. Not everybody is here. But, it's 2:00. Nobody expected that it would be that early.

And I want to -- I wanted, with the forbearance of the three distinguished people at the witness table, I want to just say a word about the committee. I'm not chairman. I'm still chairman of the Intelligence committee, so you can pitch me right out of the room if you want, but -- (laughter) --. Danny actually isn't big enough to do that, you see, so I'm okay. (Laughter.)

This is a very exciting thing to me. I'm deeply proud to be chairman of this committee, or to be able to get into that position. And I've been on this committee for 24 years and have, sort of, specialized in certain areas. And I had no idea, until I started to do preparation, the unbelievable scope of what it is that we have to do -- everything from putting 10 extra runways at O'Hare Airport, if Dick Durbin wants it. (Laughter.)

I mean, there's just -- there's no end to our capacity -- of affecting climate change, of transportation, telecommunications, the FCC. We've got -- we've got control of sports. Unfortunately, it's only college sports, not professional sports -- (laughter) -- but we'll take what we can get.

And I'm very proud that Senator Inouye -- who I think is going to come today, is now doing Appropriations, and I'm very proud that I've been able to work with him.

I look forward -- I think we all do, to working very, very hard for Americans, setting forth a very aggressive agenda on this committee. I think this committee, over the years, has had its ups and downs but we have not been always at our best. And I think our challenge now is to be at our best all the time on all subcommittees -- all subcommittees. Everything rises in importance as to the level of anything else, not just what catches the moment, or what seems to be the most intractable.

I'm also looking very much forward to working with Kay Bailey Hutchison, who will be ranking; and all members as we move things through the committee. On the Democratic side, we're welcoming Senator Mark Begich, who evidently walks everywhere in this city -- (laughter) -- walked home from the last ball last night.

Was that the 3:00 one?

SEN. MARK BEGICH (D-AK): (Inaudible) -- what time it ended, but it was late --

SEN. ROCKEFELLER: It was late, okay. (Laughter.)

SEN. BEGICH: (Off mike.) -- But, I'm here -- for you. (Laughs.)

SEN. ROCKEFELLER: And, Tom Udall, and Mark Warner. All of them are distinguished people who are going to be on the Commerce committee when the resolution passes, which it could very well before the end of the day, I would think.

And then we've got this, sort of, silly way that we have to -- we're not organized, you know. We don't know who the new Republican members are going to be. And I hope Kay Bailey comes and tells us so that we know. But, we are not able, at this point, to really have a subcommittee structure fully worked out as to who's going to be on what subcommittee until we know who all the members are going to be. And that makes sense, and it's frustrating, but it's the way things should work if they have to work that way.

I'm very excited by the talent on both sides of the aisle here. I think, when you really look at the scope of the Commerce committee, it's endless. And it's -- you know, it was one of the original committees created, and its work is really wherever we want it to go. I think we can be a big part of climate change legislation, big part of economic recovery. And I look forward to working with members on a bipartisan basis, and I expect that we'll get a lot done.

I want us to have a very aggressive agenda. And that doesn't mean that we meet three times a day, but it means that we meet on a regular basis. We'll try and systematize that so people can predict that on their calendars when that's going to be -- on a couple times a week, whatever. I promise that I'll share that kind of news with colleagues very shortly.

Now we have to begin the business of this day, which is a very good day because we have before us the confirmation hearing of Congressman Ray LaHood to be secretary of Transportation. I'm for him anyway, but my wife, Sharon, said that even if I weren't, I would have to be because she's from Illinois too. And so that's that.

So, I'd like to congratulate Representative LaHood on his nomination. And if you have any family members here, we would be very proud to meet them.

MR. LAHOOD: Thank you, Senator. Thank you very much for holding this hearing, and I do have my wife and three of my children, and I would like to introduce them. And if they would stand: my wife of 42 years, Kathy; sitting next to Kathy is my son, Sam; behind Sam is my oldest son, Darin, and his wife, Kristen. And my daughter, Amy, and her husband, Kevin, are here. Kevin, are you here? Stand up. (Laughter.) That is the LaHood army. It doesn't get any better than that, Mr. Chairman, so thank you.

SEN. ROCKEFELLER: Thank you very much.

Now, we also have another great opportunity because we have former Congressman Bob Michel -- who I've always been a great fan of Bob Michel's. I'll never forget that garage story you told me, -- (laughter) -- Congressman Michel. It remains deep in my heart, and part of my affection and respect for you.

And then my fellow White Sox fan, Dick Durbin. But, that was embarrassing last night. I mean, there was only one White Sox fan in the entire crew out there in Afghanistan. And I kept thinking about you.

So, they are going to introduce Congressman LaHood, and I cannot think of two finer human beings, more experienced people to be able to do that. And so please do so.

SEN. RICHARD DURBIN (D-IL): Thank you very much, Mr. Chairman. Let me also acknowledge Senator Hutchison. Glad you're with us here today at the kick-off of this newly-formed Commerce committee.

I want to personally thank the chairman, who now is assuming this responsibility. It was my good fortune to serve on the Intelligence committee for four years, where you served as ranking member and as chairman, and I know the fine work you did there. Much like the minister who shoots a hole-in-one on Sunday morning, you couldn't talk to us about your best work.

And I want to just say, publicly, that you have dedicated yourself to the assignments you've been given, whether it's on the Intelligence committee or (here ?) on the Commerce committee, and call on your staff to really perform at the highest level. I'm glad to hear it will be an active committee and, under your leadership, it will be a very effective committee. So, I congratulate you on that score.

You know, a lot of here wax poetic about the good old days around Capitol Hill. And for a few members on this committee, including Senator Wicker, who've had the good fortune to serve in the House of Representatives, that's where many of us got started. And there were great old days. And I can recall coming to the Congress and meeting, right off the bat, not only the Speaker of the House, Tip O'Neill, but one of his closest friends, the Republican leader, Bob Michel, from my state of Illinois.

Those were days when we fought like cats and dogs on the floor all day, and then managed to find some time to be together in the evenings and get to know one another on a bipartisan basis. And that really made for a much more pleasant and productive environment. I think what President Obama had to say yesterday, and what he's been saying throughout his campaign, is the hope that we will return to that environment.

I just want to say that the nominee for secretary of Transportation is a person who follows in that tradition. Ray LaHood distinguished himself in many ways, first as chief of staff to the minority Republican leader, Bob Michel; and then, in his own right, as Congressman from that same district. He led the effort in the House of Representatives during some of the most divisive and contentious times -- (audio interrupts) -- civility and decorum, and to try to have bipartisan retreats where members would come together with their families and really come to know one another on a personal basis.

And as you come to know Ray, you'll understand why his leadership in this area was genuine and personal. It's been my good fortune to know him for many years, born and bred in the City of Peoria, Illinois, he's been a school teacher before he got involved in government work. And I will tell you, as a member of the Illinois Congressional delegation -- a good, bipartisan delegation, I didn't have a closer friend than Ray LaHood, who was on the opposite side of the aisle and represented my home town of Springfield.

We worked on so many things together -- transportation projects, economic development projects. I trusted him completely. His word was good. And I knew that we could work together in a positive and productive way, and show some results at the end of the day. We also co-chair the Abraham Lincoln Bicentennial Commission, which will celebrate the 200th anniversary of Abraham Lincoln's birth in February of this year. So, we've worked together in a lot of different capacities.

I know that President Obama started off, in forming his Cabinet, wanting to make sure that it was bipartisan, and to show that there were leading Republicans who could serve on his Cabinet, and do so effectively. I'll be honest with you, I went to him and I said I think Ray LaHood is that person. I hope you'll consider him. And he said he would.

I know that Rahm Emanuel, as the president's chief of staff, knows Ray as closely as I do -- as well as I do, and he felt the same way. And this opportunity came along, and it was a great one because Ray has shown his understanding of transportation issues, as a member of Congress, and has worked for these issues during the time that he served.

We have this traditional rivalry -- that many of you have in your states, between down-state and Chicago. And some politicians make a career out of poking the wounds between those two areas and trying to keep everybody fighting with one another. Now, Ray and I come from the down-state side of that equation.

Neither of us have ever tried to capitalize on that geographical distinction. If we had an important meeting of the Illinois delegation about a major mass transit issue in the city of Chicago, Ray LaHood of Peoria would be there because of his genuine interest in our state and its transportation. And whether it was highways for down state, whether it was mass transit for the city of Chicago, the development of one of the nation's most important airports in O'Hare, or looking forward to the vision of how we can use smart transportation modes to reduce the use of energy and to try to protect our environment, Ray LaHood has been a leader in that regard.

Now, if he is graced with the approval of the Senate, and I hope that he will be, to be our next secretary of transportation he will have an awesome immediate responsibility. This new recovery and reinvestment bill focuses a lot on our nation's bridges and highways, the infrastructure, the airports, realizing that's critical to economic growth. I can't think of a better person to be given that assignment and that's why I come here today to completely support his nomination.

A former DOT official was recently quoted as saying the most important part of the DOT secretary's job is knowing how to work with other people. Well, I can tell you, Mr. Chairman, Ray LaHood has the most important part of that job covered if he becomes our next secretary of transportation. I'm pleased and proud of this fellow Illinoisan to wholeheartedly recommend him and encourage the confirmation of my friend Ray LaHood. Thank you very much.

SEN. INOUYE: Thank you, Senator Durbin. Yes, sir?

MR. MICHEL: Mr. Chairman and members of the committee, I appreciate the opportunity to piggyback on the great introduction of our senator, Dick Durbin. I've known the LaHood family for over 25 years and I know that when Ray grew up it was in the climate of work ethic and certainly being frugal about how you spent your money.

Before his election to the Congress to succeed me as my chief of staff, he (would sit ?) for 10 years in that position just prior to his being elected to Congress. It was my last 10 years out of 14 years as leader on the minority side of the aisle in the -- in the House. And during that time, our relationship became much more than employee/employer relationship. Over that period of time, we became the best of friends. I think, quite frankly, both families would say that we were family with one another.

He's a very quick study on the issues of the day, always careful in his decision making process, and has a special gift for dealing fairly with his contemporaries. I tell you, he's guided with a wonderful moral compass. He knows right from wrong. He's an honest forthright individual. I could trust him, as Senator Durbin said, without any reservation whatsoever, and as a congressman, he was no ideologue -- (inaudible) -- conservative Republican. Always a gentleman and respectful of his contemporaries and willing to work for a consensus.

His special efforts to -- to improve the relationship in the House which is at times -- I enjoy -- I've enjoyed the wonderful days earlier on and then it became -- it became worse and worse in that rancorous exchanges -- it was just rather nauseating at times. Ray had the good -- good experience of having experienced it really kind of under both conditions, and when he came into the Congress he wanted to do whatever he could to let's get back to the days when we could talk with one another and -- and counsel with one another, and as Dick Durbin has said he did a marvelous job trying to organize I think three or four of those retreats with so many -- whatever Republicans wanted to come, whatever number of Democrats.

And as a matter of fact, it led to Tom Foley (and I ?) then speaker of -- the former speaker of the House to visit and counsel with some of those freshman members to try and encourage them to take advantage of that opportunity to get to know one another and do away with these acrimonious exchanges. Well, after a while it dissipated and -- but I always have to give Ray the credit for trying to make the most of it.

And then finally, Mr. Chairman, and I appreciate your conceding to my asking for just a minute or two to -- (inaudible) -- Dick Durbin's introduction, I have to applaud the president for seeing the qualities in Ray LaHood that will serve his administration well. I think there's no question but that every member of this committee when all is said and done will be mighty proud of his service as secretary of transportation, and I'm sure Ray will always keep in mind too that he has an obligation certainly to please the president who is a benefactor in this case. And thank you, Mr. Chairman, for the -- and members of the committee for the opportunity to speak on behalf of my dear friend and patriot, Ray LaHood.

SEN. INOUYE: Thank you, Congressman. Thank you very, very much. Thank -- and thank you. The -- let me just say before I call on Kay Bailey Hutchinson (sic), the ranking member, to make any comments that she may want to make that we had to postpone this hearing and it's one of those infuriating things that's called paperwork, and people have to answer so many questions now and so the word was well, they hadn't finished the paperwork and so that's why we had to cancel the meeting and then people said, well, it was -- of course, the FBI does the paperwork so we removed the word FBI because otherwise everybody would think that something was going on. We didn't want that because, you know, the ranking member and I read your FBI report and it's just sparkling clean and I wanted to say that.

And then before we actually proceed my opening statement will come before my opening questions and I'd now like to say that I'm very honored to have as the ranking member Kay Bailey Hutchinson. We have served on this committee together for years. We've done Aviation together successfully for a number of years and it's a very -- it's a very strong working relationship. She's an extraordinarily talented person, as everybody knows, and I would like to call on you, Senator Hutchinson, for whatever comments you might want to make.

SEN. KAY BAILEY HUTCHISON (R-TX): Thank you, Mr. Chairman. Since this is our first real hearing as chairman and ranking member I appreciate your remarks and do look forward to having this relationship continue. We've done some great work in Aviation. We had and agreed to FAA reauthorization through our committee last year and I look forward to working on that again this year and I hope that our committee will be very active and I look forward to working with you.

I also wanted to welcome the new members on our side of the committee. Johnny Isakson, Sam Brownback, Mel Martinez, Mike Johanns are new members that will be joining our committee this year. Congressman LaHood, (we're ?) welcome you and certainly you have had two outstanding endorsements already and many of us who've worked with you do agree with your integrity and the ability to come together and do things in a -- in a bipartisan way, and I think your appointment shows that we are going to have input that will be very important in this administration.

There are three areas that I am concerned with that I think are a priority. Certainly this year the Highway Trust Fund, the highway reauthorization, will be before us and it is my hope that we can timely pass the highway authorization bill. I say that with almost tongue in cheek because it usually takes us three or four years to pass that five-year bill and then we pass it and a year later we have to do it again. But it is important that we work together and you will be a key leader here.

One of my great concerns is the Highway Trust Fund, I think, does not meet today's test of relevance. Certainly the highway system has -- the federal system has been built out. We have the (skeleton ?) and I think today, unlike when President Eisenhower started the system, every state has its own priorities and its own capabilities to fund. So I think the old donor/donee concept really needs to be looked at carefully. We would always have to have some small percentage of the gasoline taxes for the maintenance of the highway system. I think we would all agree on that.

But I do think now that states have such great needs that especially growing states like mine that are also donor states need some relief from the huge amount that we send to Washington and never get back.

We're now looking at more toll roads, more taxes to fund our highways, when we're sending billions to Washington and going to other states.

So I hope that we can start looking at a concept where states would be able to have their own money, their own priorities, in the highway trust fund with some smaller amount that would be kept for maintenance. That is something that the secretary of Transportation has suggested in the last six months or so, and I think it's something that is very, very important for us to start discussing.

Secondly, FAA reauthorization, which, as we have noted, this committee passed in a very bipartisan way because it is so important, and our bill passed through the Senate and was generally supportive. It did not get through conference, so we still don't have one. And in March the FAA extension runs out.

We know that NextGen for our air traffic control system is essential for us to be able to use our air space in the most efficient way, in the most safe way, and also our ground space. And because our NextGen has not been able to go forward in a comprehensive way, we do still have many delays, especially in the New York air space, which then affects the whole country.

So I hope that it will be one of your major priorities that we pass an FAA reauthorization bill and that we get it signed by the president and that we really focus on our air traffic control system becoming more efficient and certainly with safety as a priority. I think we can do that, and we will certainly need the help of this administration.

Third is Amtrak and high-speed rail. I believe that this administration that has just taken the oath of office yesterday will be more favorable to Amtrak. And one of the things that Senator Lautenberg and I have done on this committee is made a pact that Amtrak is Amtrak, that our national system is important for our country and for the future. And I support the Northeast corridor, and he and others that are in the Northeast support the national system. But the national system has been a stepchild. And if we are going to continue to have very bad service, it's going to exacerbate the problem with the funding.

So I hope that you will look at Amtrak and high-speed rail as a priority in this administration, because I think if we're going to have a transportation system that serves all the people of our country, it's going to mean we have aviation, we have high-speed rail and Amtrak from which states can form compacts and add to the efficiencies as well as, of course, our highway system. And I think with that kind of priority focus, we can do so much better. And I look forward to working with you to that end.

Thank you.

SEN. ROCKEFELLER: Thank you, Senator Hutchison.

What I'm going to do now -- and I'm still working it over in my mind if I want to make this a regular practice -- I think sometimes, if every single member gives an opening statement, that you have people who have flown in from all kinds of places to testify, and if you have a full committee, which I hope we're going to have because it's going to be an exciting committee and people are going to want to be here no matter what the subcommittee or, in some cases, the full committee meeting might be about, that opening statements take time.

The other side of looking at that is that members have other meetings, and I have to recognize that, and that they have things they want to say. So today we're going to have opening statements from each member. I should say, incidentally, that our three new members, one of whom has already defected -- (laughter) -- are to be treated today as members of the Senate, because we don't have our actual, you know, ratios worked out yet, so just members of the Senate. I mean, you're just going to have to live with that. That's hopefully just for one day. Is that okay? All right.

And also I'd like to say that, from now on, I want to call on people as the -- according to the order in which they arrived at the committee. This is not going to be -- most everything in the Senate is based on seniority. I think having people speak other than on the basis in which they arrived -- if they arrived early, they should speak earlier -- and I happen to believe in that. But today we'll also use the seniority system for that, and we'll start with Senator Cantwell. Then we'll go to Senator Snowe and then back and forth.

SEN. MARIA CANTWELL (D-WA): Thank you, Mr. Chairman. I don't have a very long opening statement, but I am concerned that I may not be here for the question-and-answer part, so I'll just outline my statement, if I could, to you and hope that perhaps I will be able to get back and ask you some questions. But obviously I want to congratulate you on your nomination and for your hard work in the Congress.

You may know that Washington State recently has been very hard- hit by a lot of flooding. In fact, Secretary, your predecessor, Secretary Peters, traveled to Washington State to look at and assess the flood damage along I-5 and also brought with her some $2 million in emergency relief funds, which we very much appreciated.

I want to say that we'll be looking forward to working with you on what may be as much as $125 million in damage to flood areas in our state and that it brings up an even larger question. I'm trying to make this as short as possible, but the previous flood damage that we had a year ago -- every day that I-5 is closed, it costs our economy $10 (million) to $12 million. And it's a freeway stretch that typically carries about 10,000 trucks a day. So that and our mountain pass system being shut down is where you get the $125 million in those kinds of activities.

So in addition to looking at that question, it's a very good specific point about -- I look forward to hearing your comments on what you're going to do about funding of mega-projects. Mega-projects always get a lot of attention in assessing the issue, but trying to take our transportation funding mechanisms and breaking them down into a mechanism that will actually get those projects funded and not delayed.

For us in the state of Washington, we have three different mega- projects that are of importance to us -- the Columbia River crossing, Alaskan Way viaduct, and the 520 bridge. And then two of those are in jurisdictions of Seattle, and the mayor and some of the council members are here talking about the major plan that they are about to unveil for both of those projects. So I apologize if I'm off meeting with them to hear those details instead of being back here.

And lastly, I would just say, Mr. Chairman, that it's very important to me the secretary of Transportation, in the oversight that our committee has, looking at your agency on the role that you play in helping us in the implementation of CAFE, of the fuel efficiency standards. And I think that this is something that is very important. The last administration, I would say, I think, dropped the ball on their ability to fully implement those regulations in a way that would have helped -- (inaudible) -- helped American consumers. And so I look forward to your comments on that particular issue.

So Mr. Chairman, I thank you for allowing me to make this statement.

SEN. ROCKEFELLER: Thank you, Senator Cantwell.

And Senator Snowe.

SEN. OLYMPIA SNOWE (R-ME): Thank you, Mr. Chairman. And congratulations on your chairmanship. It's great to have this committee under your leadership. Thank you.

SEN. ROCKEFELLER: We've done a lot of work together.

SEN. SNOWE: We have. And we will in this committee.

SEN. ROCKEFELLER: That's right.

SEN. SNOWE: And I just want to congratulate you, Congressman LaHood. And I want to personally welcome -- it's a privilege to see Congressman Bob Michel. I served with Bob in the House of Representatives for many of the years in which he was the minority leader. Out of my 16 years, it was probably the better part of a decade. And so I'm very pleased to see him here today.

It's reminiscent of the, you know, many outstanding accomplishments that he achieved during his tenure and his long- standing service to this country. And I just want to say that it's great to see you here, Bob, and also reminiscent of the working together and the bipartisanship that always, you know, was a hallmark of your leadership. And I certainly can testify, Mr. Chairman, to the relationship that existed with Congressman LaHood and Congressman Bob Michel. It certainly was that.

And Congressman LaHood, you have certainly garnered an outstanding record of public service, not only in the House of Representatives, but of course in your service to Bob Michel as well. And you've always had a reputation for fairness and pragmatism, and so I'm just very pleased that you have been nominated for this capacity.

As we discussed two weeks ago, there are a number of issues that obviously you're going to have to address as secretary of Transportation. Most notably, as Senator Hutchison mentioned, it's going to be infrastructure and transportation policy, the two cornerstones of our transportation policy, of course, is the Surface Transportation Act as well as the reauthorization of the Federal Aviation Administration, the FAA, which is long overdue, as we all know. It expired about 18 months ago, in fact.

But we are seeing a number of issues that are plaguing the system that we will have to address as congestion continues both on our highways and in the air. Prices continue to rise. States are cutting back because of their own budgetary shortfalls, so they're not able to supplement their infrastructure transportation programs, and so all the more reliant on those federal dollars. And we'll have to re- evaluate the highway trust fund and the way in which we fund the trust fund. That is certainly (a decision ?).

One of the first bailouts we had last year, in fact, was the highway trust fund when it had a shortfall of more than $8 billion. It is expected that we could have a shortfall of $79 billion by 2015. And as members of the Senate Finance Committee, we heard testimony from the Government Accountability Office this last July saying that the current system is simply unsustainable.

Just road maintenance alone over the next six years will cost $350 billion and we have one of five bridges that are woefully functionally obsolete.

So obviously, revenues are declining to the Highway Trust Fund as vehicles become more fuel efficient, which is critically important. We'll have to see how we will be able to fund the Highway Trust Fund with alternative revenues or alternative sources, but we're going to have to be creative and we're going to have to prioritize our investments without question.

The overall state of the aviation industry is of great concern to many of us. Certainly to Senator Boxer and myself. We introduced the passenger bill of rights, which said simply, you need a national standard, according to the courts, when states have taken their grievances to the courts and they need a federal standard. And we've seen the fact that the industry has failed to unilaterally and voluntarily adopt customer service standards. And that's why we believe that we should have the passenger bill of rights.

And finally, CAFÉ standards -- as Senator Cantwell indicated -- that will be one of your first, hopefully, responsibilities to issue regulations for the model year 2011. Regrettably, it wasn't done in this past administration, but it's critically important if we're going to stay on track for creating more fuel-efficient vehicles. Senator Feinstein and I led the effort for the CAFÉ standards. We want to stay on track and do more. And so hopefully, that will be one of your first actions as secretary of Transportation.

Finally, essential air service for rural communities. I know that you've been a strong advocate when you served as well on the Transportation Committee in the House of Representatives. I truly hope that you will look at legislation that Senator Bingaman and I have introduced to provide more flexibility. We have seen, you know, more than 100 -- in more than 1,000 communities across this country and half the states that have lost, you know, aviation service. And that is truly the lifeblood of their economy -- certainly that is true in our state. And we have to do -- we really do have to develop a policy of some kind that's going to provide the incentives and support to our communities so that they can continue to have aviation services. It's so important for economic development.

So again, I want to thank you. And I'm pleased to see you here today. And most importantly for, notably, the position you will assume.

Thank you, Mr. Chairman.

SEN. ROCKEFELLER: Thank you, Senator Snowe.

Senator Lautenberg.

SEN. FRANK LAUTENBERG (D-NJ): Thanks, Mr. Chairman.

Congratulations to you for taking on this important assignment. I have worked with you for many years on the Commerce Committee and know that you have a major interest in all of the issues in front of us and I look forward to your guidance and leadership here.

It's interesting to know that Ray LaHood is here from the state of Illinois, that he's had wonderful escorts to the table -- Senator Dick Durbin, who we all know very well and are extremely proud of; and someone with whom I had contact over the years, and that's Bob Michel. And we're glad to see Bob Michel here. We always listen to him carefully, even though there was occasional policy disagreement.

So Ray, you've come from a state with a lot of distinction. Going back some years -- I don't remember the fellow's name who was president from Illinois -- but after Lincoln, we had Everett Dirksen and we had Paul Simon. We've had other wonderful people from the state of Illinois. They've always made large contributions to the well being of our country and we believe that you will also do that.

And in many ways, Transportation secretary is one of the most important jobs in the country. And you're going to be part of an administration that has a focus on economic recovery. The president has announced his intention to get things moving. And one way to do that, in my view, is to make investment in infrastructure -- particularly transportation -- because people are ready to go to work, the jobs are crying out for fulfillment and we look forward to having your agreement.

We've counted on the Transportation secretary to keep our trains, busses and cars moving, but now we'll be counting on the secretary to help get our economy moving at the same pace that we hope that our railroads will be moving.

Congress and the president -- and President Obama are working on an economic recovery package that would invest in our trains, mass transit, roads, bridges. The investment would create 470,000 jobs -- jobs at a time when it -- Senator Inouye mentioned in an earlier meeting we had today that recent reports of 500,000 jobs lost in a month that that pace could accelerate and maybe even get to 650,000 jobs in a month. And so here's one way to put people to work in things that will contribute handsomely to the well being of the country and we hope that those investments will come and hope that you'll be able to support and plead for those investments.

Transportation's also critical to our environment, our energy independence, use less oil, emit fewer greenhouse gasses and we need more Americans to use mass transit. Many are already making that choice. Nearly 29 million people took Amtrak last year -- major record! And just think of the number of cars that that takes off the road. That's the sixth year with record ridership.

In addition, nearly 3 billion trips were taken on busses, subways and other transit options in the third quarter of last year -- a 6 percent increase over the same quarter in 2007 and the largest such increase in 25 years.

In New Jersey, transit is more than merely a way to get around. It's our lifeblood. It helps businesses grow; it improves quality of life across the board and we need to start looking at transit on a federal level the same way we see it in urban centers across this country.

And just building more roads will not solve our transportation problems. We can no longer lead passengers stranded on the tarmac or waiting in long lines at the airports. Travelers and commuters deserve more options like rail and transit to connect our communities, cities and travel hubs such as the airports.

For this reason, Mr. LaHood, we need a strong and innovative Transportation secretary. And I believe with the wonderful recommendations that you bring with you that you're a person to do that job. I was pleased to meet with you last weekend about these challenges, about others important to New Jersey and the nation.

First, we talked about the need to fully fund Amtrak and expand our passenger rail systems. Last year, Congress and President Bush recognized the need and passed the bipartisan -- my bill -- Amtrak bill. This committee played a major role in that vision and now we need to provide the funding to see that vision through.

We also talked about the critical need for an additional rail tunnel under the Hudson River. It's a national asset. And in addition to creating more than 50,000 construction jobs, this new tunnel will double the number of passengers and trains going back across the Hudson River from New Jersey to New York, but in the northeast corridor, which is the busiest rail corridor in the country.

These improvements will not happen without strong leadership in the executive branch. And I look forward to working with you, Ray LaHood, on these key issues as we continue the confirmation process.

Thanks, Mr. Chairman.

SEN. INOUYE: Thank you, Senator Lautenberg.

Senator Wicker.

SEN. ROGER WICKER (R-MS): Thank you, Mr. Chairman.

And I too am delighted and excited that my classmate and former colleague, Ray LaHood, is going to be our next secretary of Transportation.

We came to elective office together in the House of Representatives as a result of the 1994 elections. We were both staffers for distinguished members of the House before that. And I can tell you that in my opinion, Ray LaHood has the knowledge, experience, knowhow and temperament to be a fine members of the Cabinet and an excellent secretary.

It's already been mentioned that in the early days of our time in the House of Representatives, Ray LaHood stood as co-chairman of the House Bipartisan Retreat. And this really was quite an undertaking -- an effort to get not only the rank-and-file membership, but the leadership of House Republicans and House Democrats together in a way that would promote unity and working together as Americans and a little relief from the partisan rancor that sometimes we hear about.

It's also a fact that for many years, Ray LaHood has taken a leadership position in the House prayer breakfast. And Mr. Chairman, this is an ecumenical group who meet every Thursday morning for prayer in a bipartisan/nonpartisan way in the House of Representatives. And it should be no surprise, based on that, that our new Democrat president has chosen this Republican to be part of his team.

Ray, in your opening statement you mentioned fundamental pillars of openness and fairness. I think, certainly, you'll be able to bring that to the department. Also, it's a fact -- he's no pushover, Mr. Chairman! Ray LaHood has very low tolerance for nonsense. And I think that will also serve him well in this position.

I want to mention, by way of opening statement -- and maybe I'll get a chance to ask a question about it later on; if not, certainly one for the record.

But it's been pointed out by Senator Lautenberg and others that a good deal of the economic stimulus is going to be directed toward transportation and infrastructure. I see a proposal here, $43.1 billion, 5 percent of the total, including some 30 billion (dollars) in highway infrastructure investment.

In that regard, I want to caution my colleagues and the secretary about something that we call in Mississippi the Katrina effect of sending a lot of infrastructure spending at one time. Post-Katrina in Mississippi we saw a huge increase in contracting costs related to the recovery. We spent money on roads, bridges, fire stations, city halls in addition to debris removal. And the extent that we sent money for those challenges was unparalleled. In the period following this, state officials and contractors often mentioned the Katrina effect on cost. They were referencing increases in costs across all trades related to the large influx of federal funds and the subsequent demand on materials, manpower and other resources necessary to undertake the projects.

So I would just say to our secretary-to-be and to my colleagues we need to be mindful of this issue as Congress considers billions of dollars in transportation spending. I love to see highways built. I want to see what we can do to increase the number of bridges and roads built. But if all of these shovel-ready projects are bid and contracted in a very short period of time we could create a similar situation that we had with the Katrina effect in Mississippi and other Gulf Coast states.

While the funds will flow, higher costs due to abnormally high demand on the transportation construction industry could result in fewer projects undertaken because of the increased cost. It will be up to us working with you, Mr. Secretary-designate, to arrive at a figure that our system can absorb without spiking the cost of this very- needed infrastructure.

And with that, I yield back to the chairman and once again say how delighted I am that my colleague and brother is going to be assuming this leadership role.

SEN. ROCKEFELLER: Thank you Senator Wicker. And now, Senator Warner.

SEN. MARK WARNER (D-VA): Well, thank you, Mr. Chairman, and let me first of all say how excited I am to be on this committee with your leadership and the leadership of ranking member Hutchinson (sic). I'm looking forward to working with all of you.

I have to say at the outset that, as many of you know, I a few years ago concluded a term as governor of Virginia and there was no issue more vexing than transportation. A lot of things I can proudly point to that we accomplished but solving Northern Virginia's transportation woes unfortunately was not one of them.

Since the chairman has given me the opportunity to speak let me just raise three issues very quickly that I hope either now or at some other point we can -- we could discuss. I recall as governor how challenging it was at times to deal with the Department of Transportation at the federal level because so many agencies within your control -- and over the last year-plus I've co-chaired a bipartisan task force on infrastructure. And as we hopefully move the 21st century infrastructure program to more multi-modal projects, I wonder if you -- and I know this is very early in your thinking process but have you given any thought to the 11 separate agencies you have within the Department and how the boxes are aligned and whether there needs to be any realignment of those functions to make sure that as we think about a project like Dulles Royal or others that has aviation, mass transit and highway combined that you've got those funding flows and goals all aligning on a multi-modal basis, number one?

Second -- and, again, this would more relate to surface transportation and echo what Senator Wicker said -- I really wonder if we're going to take a fresh look at metrics. We've had kind of some of the old standards like VMT and others that have driven some of these formulas when truly at this point mobility, safety, climate change -- a host of these other issues are going to have to be somehow factored into the metrics by which we evaluate projects. I would love to have your comments on that.

And finally, on perhaps a more parochial basis, in Virginia we have been very aggressive on the usage of public-private partnerships and we have some actually -- some wins in that category and, again, for folks in the region we will soon see some relief on the Virginia side on the Beltway with the addition of the hot lanes. I'd love to have your thoughts on public-private partnerships, and while I'm generally supportive, one of the things I think we always have to watch out for as we look at public-private partnerships is making sure that the private sector actually has some skin in the game -- some risk capital and it's not just the public sector putting up the dough and the private sector reaping the benefits at the back end of the project. So -- if at some point you could comment on that as well.

But Mr. Chairman, thank you for -- as a member of the Senate, letting me have the chance to make a couple of comments. And, again, I look forward to working with you on this and very important matters on this committee.

SEN. ROCKEFELLER: Thank you Senator Warner. And now I have to regain my senses here and call on Senator Pryor.

SEN. MARK PRYOR (D-AR): Thank you, Mr. Chairman, and congratulations to you for being chairman of this committee and I really look forward to working with you on this committee and I think we can have a great next couple of years here.

Let me thank Congressman LaHood for putting your name forward for this very important post. And some of my colleagues here have identified just a few of the areas that you're going to have to deal with during your time at Transportation; someone mentioned rail, mass transit, FAA, the Highway Bill, ports, Amtrak. I don't think anyone's mentioned pipelines but you really have a very full plate, and the fact that you come so highly recommended from folks like Senator Wicker and my friend Congressman Bozeman from Arkansas really speaks volumes. And the fact that you want to do this in a very bipartisan way I think that's exactly where the American people are and I think you'll have a lot of folks on this committee that really want to help you succeed in doing that. So, Mr. Chairman, thank you and I look forward to everyone's statements and questions. Thank you.

SEN. ROCKEFELLER: Thank you very much Senator Pryor. And so now Senator Thune.

SEN. JOHN THUNE (R-SD): Thank you, Mr. Chairman, and I want to thank you for holding the hearing and thank Congressman LaHood for his willingness to serve in this capacity. I can echo what evidently was stated by my former colleague from the House, now colleague in the Senate, Senator Wicker about Congressman LaHood. He is a quality appointment -- someone who I had the great privilege of working with when I was a member of the House on the TNI committee. And is former boss, leader Michael, is a legend in the House as well. It's nice to see you here today.

I do want to just -- as we look to the challenges that are facing America's infrastructure -- say that in a state where we have lots of real estate and vast distances and not a lot of people that planes, trains and automobiles are pretty important in South Dakota. And so transportation issues are critical to my state, and as my colleague from Arkansas mentioned, we've got a number of big issues that are going to be coming down the pike, not the least of which is the next Highway Bill. And as the next secretary of Transportation, you will have a lot to say about how that bill is shaped and put together.

I think the cash flow problems we're facing in the trust fund are really critical and I want to make sure as we go through the process that we don't deemphasize highway investment in rural states. I think that when it comes to highways that federal investment in states like South Dakota and others that may be in the middle of the country enables those goods to move from part of the country to the other -- whether it's Seattle to New York or Chicago or wherever -- people and businesses in those parts of the country benefit from the investments that are made in the Midwest and areas of the country that don't have the population base, just like the other areas of the country benefit as well.

I mentioned this to you in our individual discussion but Senator Wyden and I have a proposal that we've been building support for called The Build America Bonds Act which would help out all states, not just large states, with multi-billion-dollar infrastructure projects and I hope that you all give it consideration as an innovative option for financing transportation projects as we move forward.

So again, I'm delighted to welcome my former colleague here today, Mr. Chairman, and the president couldn't have made a better pick for this job. And I look forward to working with him and with the members of this committee as we take on many of these big transportation challenges.

SEN. ROCKEFELLER: Great. Thank you, Senator. And now Senator Udall.

SEN. TOM UDALL (D-NM): Thank you very much, Chairman Rockefeller, and thank you for allowing us to participate today and I also thank the ranking member. I'm honored to be on this committee. I'm going to, I think, enjoy it very much just by the beginning we've had here today. And I want to say to Ray LaHood, my former colleague in the House of Representatives, I think this is an excellent nomination by Barak Obama.

I remember the years working with you, Ray, in the House on a variety of issues, whether it was renewable electricity or many other issues where you reached across the aisle, but one of the things that impressed me the most in addition to what Roger Wicker said in terms of you heading up those bipartisan retreats that we had -- trying to bring both sides together -- was that when -- of my 10 years in the house, eight of them the Republicans were in the majority, and when the Republicans were in the majority, the speaker has the chair and you were in the speaker's chair many times. And has House members know, usually when you get to a very difficult vote, a tough vote, you want somebody in the chair who's fair, who's firm -- well, this is -- (laughter). I'm going to keep talking, Ray, anyway, but -- (laughter) -- this is a --

SEN. : (Off mike.)

SEN. UDALL: I don't know what kind of signal we're being sent, but anyway -- (laughter).

But as the chair, you were known as someone who was fair, someone who allowed openness and the ability to speak but wouldn't put up with any nonsense. And you would use the gavel when it was appropriate, and I think there was a tremendous amount of respect for you, the way you assumed the roles as speaker pro tem. And so I wanted my colleagues to know that.

A couple of things that I hope you'll talk about as we get into the questioning that I'd just like to raise briefly -- one is, as we move forward on transportation -- and you obviously have a very significant agency -- 60,000 people, billions of dollars -- when we move forward in transportation, we're going to be moving forward trying to be more efficient, trying to do things in a way where we're greener and we have fewer greenhouse gases. And it seems to me as you look at your department, as we spend every dollar we're going to need to analyze what impact we're having on the environment, on the air, on greenhouse gas emissions, and are we doing it the most effectively we can. And so that's one area I hope you'll speak to as we get into the debate here.

And when we talk about efficiency, one of the interesting things that's been done in my state of New Mexico, like many of the Western states -- we're very -- we're big; we have many highways, but Governor Richardson has proposed a new commuter rail which now runs almost 100 miles, called the Rail Runner, from Belen, New Mexico, up to Santa Fe. And so I think when we talk about efficiency, we're going to have to be analyzing -- do we invest more in rail or do we invest more in roads? Do we invest more in waterways or do we invest more in roads? And I hope that your early analysis is to find out, do you have the capabilities to analyze what's the best way to do that.

So with that I want to welcome you, and I am sure that you are going to get a resounding vote whenever we get an opportunity to do that because you've had such an incredible career. And one of the final things -- you come from the seat of Everett Dirksen, so I think that says something about seats generating bipartisanship. I mean, when he was over here in the Senate, he worked with LBJ and the two of them forged a great bipartisan coalition to move our country forward. So that's a great tradition: Abraham Lincoln, Everett Dirksen, and Ray LaHood.

Thank you very much, Mr. Chairman.

SEN. ROCKEFELLER: Thank you, Senator Udall.

Senator Dorgan?

SEN. DORGAN: Mr. Chairman, thank you very much.

Congressman LaHood and secretary-designate LaHood, thank you for being here. I'm not going to be able to stay for questions. I regret that. But by now you are aware that we've called you over here to talk to you -- at some length, as a matter of fact. (Laughter.) I'm going to be mercifully brief, but I want to say two things. I'm very interested in the Essential Air Services. You and I have had a long conversation in my office about these issues. I'm very interested in Amtrak, and I'm very interested in the training of air traffic controllers and how we're using our university facilities across the country to do that.

I want to especially just mention to you that the Transportation Department, recently headed by the departed secretary, I think was very arrogant in the way they dealt with a very important issue, and that is the issue of allowing long-haul Mexican trucks into this country. They indicated it was necessary because of NAFTA. That was not the case at all. It just wasn't the case. The inspector general of the Department of Transportation said that there are in Mexico no centralization of drivers' records that someone could determine. There's no vehicle inspection reports in these centralized records. There's no accident reports in these centralized records. There isn't any way that we are ready to have long-haul Mexican trucks moving across the byways of this country. This administration did a pilot project. This Congress just over a year ago passed legislation prohibiting it. The secretary of Transportation indicated -- didn't care very much what this Congress thought; they were going to continue the pilot project anyway.

Just to show you the absurdity of this, it is required that a Mexican long-haul truck driver be fluent in English in order to be able to drive on the roads of this country, and they determined fluent in English as a situation where if you held up a sign -- a road sign such as a stop sign or a yield sign, if that driver can answer what that sign is in Spanish, they are declared to be fluent in English. So much for careful concern about safety on the American roadways.

I would fully expect within the first two months or so, Mr. Congressman, that the new president and the new secretary of Transportation will revoke that pilot project. The Congress has requested them to do so, passed legislation, and I fully expect to see action from the new secretary of Transportation that complies with the law.

You and I have had a long conversation about that. I recognize that at least part of that decision will be made in the White House, but I appreciate that fact that I think you were on the side of those of us, when you were in the House of Representatives -- on the side of those of us who attempted to pass legislation to shut that pilot project down.

So I mention that because it has to do with safety on the American roadways. It has to do with the misinterpretation of NAFTA, and I think a pretty ham-handed approach by the Treasury -- or, by the Transportation secretary, I should say, in the way it was handled.

Finally let me just say, I am very pleased by your nomination. I told you that I have great respect for you and for those who are on the front row supporting you, including Bob Michael. I thank you for being willing to serve in this new administration, and I think all of us on this committee are excited about your stewardship, and I believe you will be confirmed. We're excited about your future stewardship at the Department of Transportation, and I look forward to working with you very much.

SEN. ROCKEFELLER: Thank you, Senator Dorgan.

Senator DeMint, to be followed by Senator Klobuchar.

SEN. JIM DEMINT (R-SC): Thank you, Mr. Chairman.

Ray, again, thank you for being willing to do this. I appreciate you coming by my office. And our conversation I think stimulated a lot of my thinking, and as we talked about, the need for our Transportation Department to have a bigger vision, longer term ideas than just year-to-year projects.

As you and I know, the department was formed essentially to build an interstate highway system, which is pretty much complete at this point. There's still certainly a role for federal roads, but as you know the Department of Transportation has gotten increasingly involved with state and local roads and regulations and funding, and I'm afraid at the expense of that bigger vision that it was started with. You and I talked a little bit about the possibilities of devolving some of the federal role for highways and then looking at a grander vision, perhaps of a passenger rail system that could take some of the pressure off of our aviation system and our highways. And I would look forward to working with you on those things.

Unfortunately because of our financial situation as a country, it's unrealistic to think we can continue to add without looking at ways we might can subtract. Certainly our nation can give no less attention to our roads and our infrastructure, but there probably is a role -- a greater role the states can play as we look at different ways to fund funding long term, as gasoline becomes less and less a source of energy for transportation. So I'd love to hear more of your thoughts about maybe a new paradigm for a transportation system, because we don't need the federal government now to deal with secondary roads and bridges. We certainly need to challenge the states to do a better job of that.

And the other thing I'd just like you to be thinking about -- if I have a chance to ask a question I will -- as you know there's been much disagreement about earmarks or projects that we pick as congressmen and senators and send over to the Transportation Department. And I've heard a number of congressmen and senators say we should not turn that over to unelected bureaucrats, of which you're getting ready to become one. (Laughter.) And from previous secretaries -- and not just the most recent, but -- I've heard of what kind of dysfunction it creates when you have hundred of folks on this side sending multiple projects, thousands of projects to your side, and it makes it increasingly difficult to implement a coherent federal plan.

I would love to hear your comments later on that because President Obama has made it clear he would like to eliminate all or part of the earmarks, and so that's something that certainly I would like to hear your philosophy on.

So with that, Mr. Chairman, I'll yield back.

SEN. ROCKEFELLER: Thank you, Senator DeMint.

Senator Klobuchar.

SEN. AMY KLOBUCHAR (D-MN): Thank you very much, Mr. Chairman.

Again, congratulations on -- on your new position and I want to tell you one of your first acts of leadership was to allow this room to be used by the Fergus Falls Minnesota Marching Band on Monday and in perfect formation, as your staff will tell you, they filled up this entire room and did "Yankee Doodle Dandy" and so I believe that's an honor of your chairmanship.

Thank you so much, Representative LaHood, for being here. I enjoyed our meeting. We care a lot about transportation in my state. I think you mentioned you were there for the Republican convention this summer and saw first hand some of the work we're doing including that quick repair we did of the I-35W Bridge. Certainly that brought home to me the importance of transportation funding when we have something like a quarter of America's 600,000 bridges that have aged so much that their physical condition or ability to withstand current traffic levels is simply inadequate.

I said the day that the bridge fell down that a bridge just shouldn't fall down in the middle of America, not a six-lane highway, not a bridge that is just six blocks from my home where 13 people died in this tragedy. I think we discussed the fact that fixing these bridges and roads and other infrastructure, rail, won't be easy but I would say that would be my leading concern as Senator Hutchinson (sic) so eloquently discussed at the beginning of her opening statement.

Secondly, the FAA expects a number of passengers who fly on U.S. commercial carriers to exceed an astounding 1 billion passengers by 2015, up from 740 million passengers in 2006. We need to be prepared. Appreciate the chairman's leadership on this issue and the work that this committee has done. Clearly, modernizing our air traffic control system should be a key priority. I'd say though our new president is pretty good with technology, still wanting to hold on to his Blackberry, and I'm very hopeful that he will see this as a priority as well. We also need to ensure that the FAA is employing a well- trained group of air traffic controllers. Today's air traffic controllers, as you know, are retiring in record numbers and those who remain are overworked. In the coming years we need to hire and retain a sufficient number of air traffic controllers and train them to do the important work that we demand of them.

Finally, to look at our transportation options and the need to have more mass transit. Clearly, part of this will be railroads. I missed Senator Lautenberg's opening. I'm sure he stressed the importance of Amtrak. One other issue I wanted to mention is the captive shipper issue. In my state like Senator Thune's (ph) state and others we have a number of small businesses and large businesses that rely on our railroads.

Railroad competition has all but disappeared. There were 63 Class One railroads operating in the United States three decades ago. Today, only seven remain with four of them controlling over 90 percent of the rail freight. That would be fine if the rates would be acceptable but we see unfair rates for captive shippers that are at the end of the line the way it's priced and it's very difficult under the current system for them to challenge these rates in any way. So that's something that I'd like to pursue.

Senator Dorgan and I and others have a bill that we're pushing. There's also another bill in the Judiciary Committee and I hope you look at that. In his 1963 memoir, President Eisenhower said of the interstate highway system more than any single action by the government since the end of the war this one would change the face of America. Its impact on the American economy, the jobs it would produce in manufacturing and construction, the rural areas it would open up was beyond calculation. He was right then and I'm hopeful as we look at this economic recovery package and the work that we need to do in the transportation bill that he will be right today.

It's our responsibility to work in a bipartisan manner on this issue. Certainly, your nomination as a Republican congressman by this president to this position is a symbol of that. So thank you very much and we look forward to working with you.

SEN. ROCKEFELLER: Thank you, Senator Klobuchar. I just -- I want to reiterate for a few of you who came in after I made my opening remarks we're going to have two new procedures in this committee. One is that at the beginning of any hearing where there are witnesses I and Senator Kay Bailey Hutchinson will have opening statements but I think it is not a good use of our time to have every single member make an opening statement.

Why do I say that? Because I think it encourages people to suddenly find other meetings they have to go to or people look at who's going to be speaking ahead of them or get some idea of that and then they decide they just don't -- (inaudible). I want this to be a committee which is immediate, where people feel that if they show up on time there's a reward for that -- that (we hold ?) conversation to substance. Not that any opening statements are lacking in substance but just that that can all come out during the point of questioning.

And as you've heard today, a lot of opening statements have gotten to some of the questions that, Congressman, that you will be -- that you will be asked. The other -- so I hope that you will accept that. And the second is that I think that what we need to do here is to have the order of arrival in terms of speaking. I think it's fair. Some committees use seniority and I just don't think that makes a whole lot of sense. I think when somebody gets here before somebody else that person ought to be able to ask a question when it comes time for questioning before somebody else. And so that will be the order of the day if that meets with the approval of my distinguished ranking member.

SEN. HUTCHISON: Oh. Yes, I do agree and I think people will have a chance to question and we'll get to the questions sooner, (not to mention our ?) witnesses -- witnesses now and in the future would have a chance to talk.

SEN. ROCKEFELLER: All right. It's Congressman LaHood, isn't it? We -- yeah. (Laughter.)

MR. LAHOOD: (Off mike.)

SEN. ROCKEFELLER: And -- and what's the position again? (Laughter.) With great respect, sir, we welcome your testimony.

MR. LAHOOD: Well, Mr. Chairman, thank you very much. I know that you're all very busy here today. There are a lot of things going on. I want to personally thank Senator Durbin, my senior senator, who I have great respect for and he's mentioned the great working relationship that he and I have had in so many different areas, and also my mentor and former boss, Bob Michel, for the introductions. And Mr. Chairman, all of the members have a copy of my statement and because of the busy schedule you all have if you want to just put my statement in the record I'd be happy to respond to your questions now so that everybody that's here and has to go to another meeting would have a chance to ask the questions that they would like.

SEN. ROCKEFELLER: No -- no, Congressman, you've got to -- you've got to encourage good behavior here so we need your opening statement.

MR. LAHOOD: Chairman Rockefeller, Ranking Member Hutchison, members of the committee, it's an honor for me to appear before you as President Obama's candidate for the United States secretary of transportation. Today, I will tell you a little bit about myself, communicate my vision for leading the department if I am confirmed, and most importantly, hear about the issues you feel are important.

Before doing this, however, I want to emphasize two principles I will bring to everything I do at the department if confirmed. First is openness. That means an open door to you, to your Senate colleagues, to my former colleagues in the House, and to all Americans who depend on and care about our transportation system. This was a basic principle of President Obama's campaign and it will be a watchword for me at U.S. DOT if confirmed.

No one person or agency has all the knowledge, insight, or perspective needed so I will hear what people have to say before decisions are made. The second principle I've lived by all of my public service career is fairness. If I am confirmed, I will have the unusual perspective of being a Republican in a Democratic administration. This gives me a real appreciation of the value of listening to all sides when disputes arise and projects are reviewed. I hope you take my selection as a signal of the president's commitment to focusing on policy rather than partisanship.

There are no Republican or Democratic transportation issues. There are national issues that affect us all. While my primary mission if confirmed will be to bring President Obama's priorities to the department and see them effectively implemented, I will do so with a commitment to fairness across regional lines and across party lines, and I will do so in consultation with Congress, governors, and local officials.

Now, a little about myself. For 14 years I've had the honor of representing my hometown of Peoria, Illinois, and the 20 counties of the 18th District of Illinois in the U.S. House of Representatives. This district was previously represented by, among others, Abraham Lincoln, Everett Dirksen, and Bob Michel. I served on the Transportation and Infrastructure Committee for six years and the Appropriations Committee for eight years. I also served in the Illinois House of Representatives. In one form or another, I have worked for government and public service for 30 years.

As I said before, my primary goal if confirmed will be effective implementation of President Obama's priorities. As I see it, this means a strong focus in at least four areas. First, safety -- on the roads, on the rails, in the air, and on the water. This has been and must continue to be the central focus of U.S. DOT. This goal must guide everything done by both the leadership of the department and its workforce who will be our partners in everything we do.

I know the committee established this goal when it created the department, and it's dedicated to the success of the safety mission. If confirmed, you can rely on me for the same dedication.

Second is the economy. I do not need to tell anyone here about the severe economic challenges we face -- 2.6 million jobs lost in '08, and unfortunately more to come in '09. The president and his economic team have spoken about the need for quick action, and the economic recovery plan responds directly to that need.

Transportation is a big part of that plan. And one of my first tasks, if confirmed, will be to manage the open and effective use of those funds. But job creation cannot be the only goal for these investments. As we attend to our immediate challenges, we must keep watch on longer-term results.

The most compelling reason for infrastructure investment is the lasting economic and social benefit it brings over decades, and even generations. Much of our economic strength is built on the wise infrastructure investments made by our predecessors. And so, at a minimum, we cannot let the assets we inherit fall apart. I am committed to investments that will help bring the country's transportation assets up to a state of excellent repair.

Even as we repair what we have, we also must shape the economy of the coming decades by building new infrastructure. We need to leave something of value to those who come after us. This work must be done with an eye toward our competitive position in the world by investing in things like better freight movement, but it must also recognize a third major policy focus: Our transportation system and the development it enables must be sustainable.

We must acknowledge the new reality of climate change. This has implications in all areas. The inner-city, rail and mass-transit funding in the economic recovery plan are a part of the equation, but only a part. Sustainability must permeate all we do, from highways and transit to aviation and ports. President Obama is committed to this principle, and so am I.

Fourth is a strong focus on people and communities, where they live and work. This can take many forms. In aviation, it means a commitment to the passengers. An aviation system focused on safety, convenience and confidence of the traveling public is a successful one.

For surface transportation, it implies a commitment to the principles that some refer to as livability; that is, investing in ways that respect the unique character of each community. The era of one-size-fits-all projects must give way to one where preserving unique community characteristics, be they rural or urban, is a primary goal rather than an afterthought. And I intend to make livable communities a big part of what we're going to do, hopefully under reauthorization, and in some other areas.

These four areas -- safety, the economy, sustainability and livability -- will be major priorities for me if I am confirmed. But whatever our goals may be, we will not achieve them unless policy and investments are driven by outcomes.

A key challenge for those who craft the nation's transportation programs -- that is, all of us here today -- will be to link decision- making to performance at all levels. This will require a new commitment to measure performance, as was called for in the recent report of the National Surface Transportation Policy and Revenue Commission, and to adjust our course where progress is too slow. Performance measurements is key to assuring that new money is invested wisely and the public has enough confidence in our work to support continued investment.

To conclude, Mr. Chairman, thank you again. I want to work with this committee going forward. And I will respond to your questions. Thank you, sir.

SEN. ROCKEFELLER: Thank you very much.

There are so many questions to answer. And maybe I will just start with what has already been discussed by the distinguished ranking member and others, and that is the whole question of our air traffic control system, funding for the FAA, getting a reauthorization bill out in time.

I have always been -- I have a new trick which I use, which actually works, and that is I say that Mongolia has a more modern air traffic control system than we do. It happens that they don't have any at all right now, but they're building one, and it's digitalized and it runs on the GPS.

We have our old system, which we blithely accept, as we accept enormous delays, knowing perfectly well that if you could -- there are various ways you could reconfigure runways at O'Hare, which has been done to some extent. But if you had an air traffic control system that was digitalized under GPS, you'd probably have a one-third efficiency pickup in the skies.

Well, to do that, it costs money. And in order to build a new air traffic control system, it obviously requires new money. Secondly, you have to maintain the old one as you're building the new one, so that's a double hit. Traditionally, the FAA has been underfunded. And traditionally, many of our programs which we'll be discussing over the coming months have been underfunded.

But I'm just interested in your attitude, Representative LaHood, as to this question of NextGen and efficiency in our skies.

MR. LAHOOD: Mr. Chairman, let me just say that one of my top priorities is to find the most talented FAA administrator that we can find, recommend that person to President Obama so he can recommend that person to the Senate for confirmation. The FAA Administration and the FAA administrator is one of the most important positions within the agency, and we've talked a lot about that during my transition.

We need someone who can help resolve some of these disputes that have taken place between the controllers and the agency. That has to be a priority. We have to have people in these TRACONs. We have to have people that work for the FAA who are people that like going to work every day, because they have very important jobs. All of us that fly as often as we do want to make sure that people who are controlling aircraft are people who are satisfied with their work.

And so I'm trying to find somebody, frankly, who's willing to come into the job and work with the controllers and resolve the dispute and get that off the table and not make it something that we're going to have to deal with or that the president's going to have to deal with. And so that's a top priority.

The next priority of the FAA is obviously NextGen.

SEN. ROCKEFELLER: Can I interrupt for one second?

MR. LAHOOD: Yes, sir.

SEN. ROCKEFELLER: One of the problems -- and you brought it up very distinctly -- is how we fund the new air traffic control system. And we have a system now where, in the so-called legacy airlines -- there used to be so many, just like trains, and there are many fewer -- are bearing 92 percent of the cost of running our analog air traffic control system, whereas the great majority of the airplanes -- and I don't include cropdusters or King Airs or anything in that category, but private jets, things of this sort have to be treated in the same way by an air traffic controller -- same attention -- and they're paying for about 8 percent of the cost. That doesn't strike me as entirely fair. Do you have thoughts on this?

MR. LAHOOD: I do, Mr. Chairman. And my thought is that we need to -- when we look at NextGen, we need to look at a bigger picture of how we get to where we want to be, but then we need to set a very realistic benchmark. And based on what I've been able to learn from the experts in this, we need to look at how we get the next five to eight years out in terms of really getting to NextGen, with the idea that it's going to take much longer than that, so that everybody in the industry, everybody that uses the equipment, everybody that's involved in this, realizes that we have a short-term goal that can be met that fits into the longer-term goal of getting, you know, completion of NextGen.

But this idea of having some kind of a pie-in-the-sky idea for getting to NextGen without an avenue to do it -- and I think the avenue is to say, in the next five to eight years, the industry, the controllers, everybody knows this is where we're going. This is the road map. And then the overall goal is to complete that. That's my idea on it. And look it, I know this next-generation technology is not inexpensive, but we have to do it. There has to be a commitment from the Congress, from the FAA, from everybody, all the stakeholders, to get this done. The flying public deserves it.

SEN. ROCKEFELLER: I thank you, sir. And I'll just close, before yielding to Senator Hutchison, that we had a number of these meetings when we asked the legacy airlines, the general aviation community, the various unions involved, to get together and figure out what would be a fair way to fund a modern air traffic control system and yet have it reflect, in some way, the usage of that system. And we got nowhere, as you know.

So I just put that on your plate with some feeling and call on Senator Hutchison.

SEN. HUTCHISON: Thank you, Mr. Chairman.

Representative LaHood, do you support the full national Amtrak system?

MR. LAHOOD: Well, the bill that was passed in the Congress last year is a very good bill, and I fully intend on working with Congress to implement that.

I think it's the way forward to get us as comprehensive as we can an Amtrak system in this country, which -- I'm not an independent operator anymore because I didn't get elected anything last November, but during my 14 years in Congress, in the House, I had been a strong supporter of Amtrak. It's the lifeblood for many, many communities around the country, and I will work with all of you to implement the Amtrak bill. I think it's a good bill.

SEN. HUTCHISON: Thank you.

Toll roads -- recently I think we have focused really too strong in my opinion on private-financed toll roads to solve the problems of urban congestion, and in many instances this has taken on I think an abdication of private property rights. I am very concerned about our federal government giving incentives to promote these, and in some instances allowing tolls over every lane of a federal highway that the taxpayers have already built. What is your position on tolling federal highways that have already been paid for by the taxpayers for as many as 10 and 12 miles, every lane? I think it is breaking our contract with the people that we would have a federal highway system that would promote commerce because they are freeways. And I would like to see what your position is and what this administration will do in regards to these massive toll roads.

MR. LAHOOD: I think one of our big challenges, Senator, is to find ways to plus up the trust fund. Lookit, we all know that were around here last year, we had to provide $8 billion to plus it up. We're going to reauthorize the transportation bill this year, and there's not going to be enough money due to all the things that all of us want to do. And I think we do have to think outside of the box, and part of thinking outside of the box is the idea that we would -- in trying to build lanes or add lanes on or trying to build additional roadways, is the idea of having tolling pay for part of that.

Now, the idea of taking part -- you know, the interstate highway that's already there and people are using and putting tolls on that -- I think that is not -- personally I think that is not a good idea. Obviously, you know, it's something that people have talked about but it's not something that I personally think is a good idea.

But I do think the idea -- if you want to add an additional lane to a road and you want to toll it; if you want to build a bridge which costs an enormous amount of money, I think people ought to think about tolls on the bridge as a way to pay for it and as a way to maintain it also.

But the idea of taking an interstate road and putting a tollbooth on it I think is not a good idea, Senator.

SEN. HUTCHISON: Well, thank you. That's the answer. I have said that I agree. We should be able to toll a lane to build another lane. But that doesn't close the free lanes that are there, and you're keeping the same number of free lanes. And I also think, with local input and approval, tolling a bridge is fine. I think the key, though, is that we don't have a policy in this country of breaking the faith with the taxpayers who have built a federal highway system. And it has taken, what, 60 years to do it, and then we stop the freeway and all of a sudden toll -- it's just the wrong public policy. So I think you have said you agree with that, and I certainly agree with you on the distinction between closing a lane with tolls and adding another lane.

Last question: slot auctions. This Department of Transportation has gone out with slot requests for a proposed rulemaking to auction slots that have been already paid for by different airlines, particularly in the New York area -- LaGuardia -- and then reselling them without the consent of the airline that has already purchased them. What is your position on that, and are you looking at stopping those auctions or going forward with them? I'd like to have --

MR. LAHOOD: Lookit, Senator, I think that if the idea of relieving congestion at a place like LaGuardia -- and one way to do it is to eliminate slots, I think it kind of defeats the purpose then to go back and say that you're going to auction those off. You know, personally, again, I don't like that idea. I think it defeats what you're trying to do. If you're really trying to cut down congestion, then eliminate the slots. But the idea of then going back and re- auctioning them, I -- to me it doesn't make any sense to do that.

SEN. HUTCHISON: Thank you. I agree with you, and I appreciate that answer.

Thank you, Mr. Chairman.

SEN. ROCKEFELLER: Thank you, Senator Hutchison.

Senator Lautenberg.

SEN. LAUTENBERG: Thanks, Mr. Chairman.

Again, Representative LaHood, soon to be -- well, I won't preempt the committee, but so far you're doing pretty good. (Laughter.)

We're going to -- last year you voted as a House member for my $13 billion Amtrak bill, greatly -- which would greatly expand rail service throughout our country. Ray, can we count on you to fight to get us the full funding to meet this law, to meet the increased demand for rail travel that we're seeing?

MR. LAHOOD: Senator Lautenberg, I've been a strong supporter as a 14-year member of the House of Amtrak. It's the lifeblood of so many communities around America. I will do all that I can to be helpful to you, to the Senate, to the House, to the Congress, to find the funding to implement what I think is a very good bill that we all voted for last year.

SEN. LAUTENBERG: Okay. I just wanted to remind you. (Laughter.)

Anyway, approximately $5 billion from the Federal New Starts program are expected to be needed for transit projects around the country and in the coming year, but the FTA -- the Federal Transit Administration -- only has less than $1 billion as a ceiling to commit to these projects. As secretary, would you support increasing this authority so that these projects, including a new rail tunnel under the Hudson River -- and I want to point out to those who hear this that this is not a commuter tunnel; commuters use it. This is a national priority. It attaches the financial center of the world with the rest of the country with ease and reliability, and we've got to make sure that we continue to expand that need.

I remind everybody, on 9/11, when few things were operating to enable people to get from place to place, it was Amtrak that brought people up from Washington so that they could see what was happening and act accordingly. So as secretary, can we count on you to support increasing this authority so that these projects, including the rail tunnel under the Hudson River, can move without delay? It's going to provide immediately 6,000 jobs, which is a mission that this wonderful president of ours has chosen to do, and that is to build employment. So can we count on you?

MR. LAHOOD: You can count on me, Senator.

SEN. LAUTENBERG: The current FAA tried to redesign the air routes over our region -- New York and New Jersey. These changes have created problems, including some confusion between pilots and controllers in many instances of planes going the wrong way after takeoff. I'd like your commitment to look at this problem and try to halt the use of routes -- these new routes until the potentially dangerous situation is resolved.

MR. LAHOOD: Well, Senator, you have my commitment to certainly look at it and to instruct the FAA to do all they can to meet with you and your staff and other people in the region to try and figure out how we -- figure out a solution to the problem.

SEN. LAUTENBERG: Okay. Safety, you said, was a principle factor in your view.

MR. LAHOOD: Absolutely.

SEN. LAUTENBERG: Now, I don't know whether this question was asked, Mr. Chairman, while I was out, but the air traffic controllers have been without a collective bargaining contract since 2005. Can I count on you -- tell me if you will work with the air traffic controllers, other FAA units, to get a collective bargaining agreement on pay and working conditions in place.

MR. LAHOOD: Senator, I think two of the most important things that the FAA administrator needs to do is to resolve the dispute and get it off the table, for President Obama and for all of us, and get it behind us. I think it's very important. I think it's very doable -- I really do -- based on everything I've heard. And then of course, you know, the second most important part of that job is to get the next gen. But we're going to be committed to really getting an agreement that people feel they can live with.

SEN. LAUTENBERG: Well, one of the things that I sense -- and I hope that I'm correct in my analysis -- you're going to be an active secretary of Transportation.

MR. LAHOOD: Yes, sir.

SEN. LAUTENBERG: And that's what we want. We don't like spectators doing these jobs. We don't like second-guessers doing these jobs. We would like leadership. I commend you, and I look forward to your continuing to move through the process.

Thanks, Mr. Chairman.

SEN. ROCKEFELLER: Thank you very much, Senator Lautenberg.

Senator Klobuchar.

SEN. KLOBUCHAR: Thank you very much, Mr. Chairman.

When we met last week, Representative LaHood, we talked about our transportation needs. We talked about thinking outside the box when it came to financing. And as Rahm Emanuel -- I know you wanted me to quote him in your confirmation hearing here -- has said, we shouldn't waste a good crisis.

Could you give me some ideas about -- just some out-of-the-box ideas or things that are on your mind? For instance, replenishing the Highway Trust Fund, how we're going to do that. That would be a start.

MR. LAHOOD: Well, first of all, what Senator Warner said, I think it's something we really -- this thinking outside the box, these public-private partnerships. I think tolling of new lanes, tolling of highways, is a different way of thinking about it -- I think of tolling bridges.

If, you know, people need a new bridge, we need to think about, you know, those kinds of opportunities that would help us pay for the kind of infrastructure needs that all of us know are very, very important. And perhaps use the Trust Fund to maintain some of the highways that we've built.

But if we're going to think innovatively, in the reauthorization then -- you know, those are some of the ways that we need to think about these things, differently than just the gasoline tax. We know that Amtrak ridership is still way up even though gasoline prices have come down. We know, in places like Chicago, that people are still using a lot of mass transit even though gasoline prices have come down.

And we know that, you know, people are still going to drive, but the resources to pay for it, through the Trust Fund, is a dinosaur, if you'll excuse the expression. It was developed when -- you know, when Eisenhower and the Congress came up with the idea of developing an interstate system.

We've come far afield of that now. And so I'm willing to listen to all these ideas. And we need to really be creative about this. And I think we can be.

SEN. KLOBUCHAR: Very good. Thank you.

The bridge bill you and I discussed -- I don't need you to comment exactly on it -- but the issue that not enough money has been focused in the states on maintaining bridges, because it's always fun to build new bridges, and have a ribbon-cutting, and things like that. And both Congressman Oberstar and I have been concerned about the fact that not enough of the bridge repair/bridge maintenance money goes into bridge maintenance. Want to comment on that?

MR. LAHOOD: Well, you obviously pointed that out very well to me. And I'm certainly willing to look at it, and work with you on it and figure out ways to make sure that we maintain not only the bridges but the interstate system also, which -- it's a very comprehensive system, one of the best in the world, if not the best.

SEN. KLOBUCHAR: Another topic -- a little different. I'm a strong proponent of high-speed internet. In the economic recovery package that we're considering right now -- and there's obvious issues with people in rural areas not having access, but I understand that laying fiber is an expensive undertaking. And so it seems to me that when we embark on increased spending on highway projects, we would also be wise to consider ways to couple road construction and maintenance projects with the laying of fiber.

In other words, why dig up roads twice, in this difficult economic time, when you can kill two birds with one stone? Do you see any kind of potential for partnership in this area, in the near term, with the economic recovery package, but more likely with the highway bill, as we look at transit funding and how we can couple this with incentives to lay the fiber at the same time?

MR. LAHOOD: I think, as we reauthorize -- again, wel have to think outside the box, and in ways that we haven't thought about these. I've been a strong supporter. Coming from a state like Illinois, when you get south of Interstate 80, it's very rural. Broadband is very important. And as you, you know, build roads into rural parts of states like Illinois or Minnesota or Virginia or wherever, we need to figure out ways to make sure that people have access to the world. And I think that's what we really ought to be thinking about in the reauthorization.

SEN. KLOBUCHAR: Thank you very much.

MR. LAHOOD: Thank you.

SEN. ROCKEFELLER: (Off mike) -- sorry. Senator Snowe.

SEN. SNOWE: Mr. Chairman, thank you.

Returning to the question on the CAFE standards, because that clearly is going to be one of the major issues that you'll be confronting, as you know that the previous administration did not -- I mean, they issued the ruling for the model year 2011. Have you had a chance to evaluate this issue?

And I say this because I know that there will be concerns raised, 'Well, you know, this may be not the appropriate time, given the state of the auto industry.' But that's just precisely what got the auto industry in trouble financially -- were not prepared, you know, they weren't on the vanguard of change and innovation, technologically, to respond to the marketplace when, you know, prices of gasoline skyrocketed, and didn't have the available models for hybrid technology to any great extent, or fuel efficient vehicles.

So we received cost-benefit ratios from the National Highway Transportation Safety Administration yesterday, both for light trucks and automobiles, and, clearly, an indication that the benefits outweigh the costs through the model year 2015.

And I certainly would like to share this information. It's something that you all will be able to receive. But I don't -- I would like to get your input in terms of how you view this issue and how you're prepared to address it as the next secretary of Transportation?

MR. LAHOOD: Senator Snowe, when I was in the House I probably voted -- I don't know, maybe eight or 10 times on amendments to raise the CAFE standards. I think it is one way for us to really overcome some of the pollution that exists around the country. But, more importantly than my own votes, the idea here is that President Obama, as you know, is very strong in this area, has spoken out on it on a number of occasions.

They've not going to push me -- have to push me very hard from the White House to do this, but I assume that I'll be hearing from them very soon. We're going to meet the standard. And we should be doing that. It has to be a part of the overall plan here to eliminate pollution, the greening of America, and getting the American car manufacturers in the game here with the reality that they need to be producing American cars that get much better standards.

SEN. SNOWE: Well, I appreciate that because it is true, I mean, when you weigh the benefits to the costs -- whether it's, you know, climate change effect, or reducing gasoline consumption, or carbon dioxide emissions, you know, collectively, truly do provide tremendous benefits and outweigh the costs. And I appreciate that because the schedule for issuing the deadlines has to be by April 1st as you well --

MR. LAHOOD: That's correct.

SEN. SNOWE: -- as you well know.

And I just -- hopefully, that that will be the case. Frankly, continuing to defer I don't think helps the industry. I think they need to have certainty, in addition to the fact that we have to be on the cutting edge of change, and being prepared for the future, given, you know, the state of energy today, and putting themselves at risk, as we found when the consumers were not in a position to be able to purchase vehicles that were fuel efficient, and they weren't prepared to sell them.

So, it's in -- it's our national interest, frankly, in the final analysis. And I think that these statistics certainly underscore the value of the CAFE standards and how we must meet to -- we must achieve them and meet the deadlines that are created in the law --

MR. LAHOOD: Senator Snowe, I just want you to know that I'm going to do everything I can to try and meet the deadline.

SEN. SNOWE: I appreciate that very much.

Secondly, on central service, again, it's a critical issue, as I mentioned earlier. And I hope that you would take a look at this legislation that Senator Bingaman and I have introduced, particularly in providing some flexibility in the contracts between the essential air service community -- the small communities and the airlines, to extend those contracts from two to four years.

Again, I think it's much more cost-efficient. It certainly is for the communities to have certainty and stability and to be able to negotiate, you know, cost-efficient contracts, and it's certainly something that is truly necessary if we're going to do anything to rebuild rural communities across this country.

And, frankly, they've been short-changed. In the promises of deregulation in 1978 they were supposed to be part of a master plan, a national infrastructure system, and they've truly been left behind. So, I hope that you will evaluate that as well.

MR. LAHOOD: Senator Snowe, I know that Chairman Rockefeller is keenly interested in this. Again, when I served for 14 years in the House I had so many of my small communities that were lacking in air service. And we worked very hard to get a essential air service in these communities.

It's important. It can be an economic engine for these communities, and it's an opportunity, really, for people in these communities to have service. And I will work very hard with you and other who want to, to make this happen.

SEN. SNOWE: I appreciate that. Thank you very much.

Thank you, Mr. Chairman.

SEN. ROCKEFELLER: Thank you, Senator Snowe.

Before I make -- just make a suggestion. I'd just like to say that I think our posture as a committee should not be to figure out, 'gee, we're not going to have the money to pay for this.' I think our -- you know, because of whatever size the stimulus package or our national debt's going to be, I think our posture ought to be: We need to do everything that we need to do to fulfill the mandate of this committee, and protect the safety, and the, you know, prosperity of the American people. And that's the way -- I intend to, at least, look at it, so that that will land squarely on your shoulders, should you be confirmed, all the hard decisions.

Now, having said that -- (laughter) -- have said that, and before calling on Senator Warner and Senator Begich, it is the desire of the majority party to try and get all nominees approved this afternoon if possible. And there is a way that we can do that and meet the 4:00 deadline. (Laughter.)

And that is by asking -- in that I sense nothing but approval and willingness to work with you, from our point of view -- and from your point of view, exactly the same view towards us, I would suggest, I would ask if the members of the committee, voting members of the committee would give Kay Bailey Hutchison tonight the right to simply inform the floor that if they want to run a UC on you at one minute of 4:00, and get you nominated by 4:00, the committee will not be unhappy. The chairman will be happy.

SEN. HUTCHISON: Mr. Chairman, let me just say that I agree with that. I think 4:30 was the deadline --

SEN. ROCKEFELLER: 4:30 -- (laughter.)

SEN. HUTCHISON: -- so, it'll --

SEN. ROCKEFELLER: A little pressure on my --

SEN. BAILEY HUTCHISON: -- you know, I'm the realistic, responsible Republican here. (Laughter.) But, seriously, I think this is a very good idea of yours. I appreciate your leadership -- because I think it is fair for all of us, and right for all of us that Mr. LaHood become the secretary, and go over there and start doing so many of the things that we have just asked him to address. And so I would approve of that.

We will also notify our side that it's going to happen, and if they want to object, they will have the right to object. But I don't see anyone doing that. I think that you have done a very good job, and I look forward to working with you, and I hope we can do that this afternoon by 4:30.

SEN. ROCKEFELLER: And that means that a unanimous consent agreement will be run through the telephones on each side, and if anybody objects, then that ends that.

And then we hope that nobody objects, and then that'll end that, and we'll have a new secretary of Transportation. So that will proceed.

And then, in order of membership on the Committee, I need to call on Senator McCaskill. And just so that Senator Warner and Senator Begich don't feel mistreated, it's just a problem of one day.

So Senator McCaskill, you have what you have to say and ask, and then Senator Warner, then Senator Begich.

SEN. CLAIRE MCCASKILL (D-MO): I will be very brief, Mr. Chairman, thank you.

I know there was some discussion earlier, Representative LaHood, about earmarks. I tried to research earmarks in the Transportation budget, and found out that one of the reasons it has flourished is because it's so darned complicated.

Most members probably don't even understand the difference between an above-the-line and a below-the-line. Many of them don't understand that -- in fact, when I talked to CRS about it, trying to figure it out, they told me to find an easier issue to work on.

Clearly, it is not a matter of bringing extra money into a state. Clearly, there is some robbing Peter to pay Paul that goes on with the earmarking process.

My state has an extensive planning process, both through metropolitan planning organizations and through our state highway department. Lots of input, a regional approach, cost-benefit analysis, and most -- (inaudible) -- program, it is well thought-out, and with all the kind of input that you would ever want for a public infrastructure project.

When we are earmarking around here, many times we are just putting projects -- (audio break) -- these state agencies that they, frankly, don't even want to do, because they have other projects that have, in fact, had this kind of public transparency analysis.

And in FY '08, for example, 340 million (dollars) of the $600 million that was going to be extra money that could have gone into core funding programs was skimmed off for earmarking.

And one the of the things that's most frustrating is even that did -- what you have above the line that may be extra money, that money doesn't go to the most valuable projects in terms of needs in our country; it goes to who's most senior. It goes to the member that is the most politically vulnerable. It goes to people that serve on certain committees. It doesn't go based on some kind of analysis as to what is the best use of that money, in a macro sense.

I would like your answer today about what I just said and how you view your job as the secretary of Transportation to have a more transparent and open process, including local planning for the way we fund infrastructure in this country.

MR. LAHOOD: Well, thank you, Senator. And I -- you know this, because you, like all of us, have followed the campaign and followed the rhetoric.

Senator Obama -- excuse me, President Obama has made it very clear that in the stimulus bill, the lion's share of which will come through the Department of Transportation, will not be earmarked money.

We're going to do everything we possibly can to make sure his mandate and his direction is carried out in our part of the stimulus.

So we're going to work with the governors and we're going to tell the governors this money can come to your state, but it has to be for projects that have been planned and organized and have met all of the requirements.

Because we want people working this summer building roads, building bridges, and doing infrastructure work. We're going to hold governors accountable and we're going to make sure that there's no earmarked dollars. That's the mandate that I believe we have from President Obama on this.

Now, when it comes to reauthorization, we're going to have to work with all of you. I was on the T&I Committee in the House for six years. And I'm not going to describe in detail all the stories that went on over there about when a bill was marked up, like ICE-T (sp).

But the point is it's up to the members to decide there aren't going to be earmarks, and it's up to the members to decide that this money is going to be spent in a certain way. And we -- we'll help you with that, but when we get a mandate from the Congress that x amount of dollars has to be spent on x amount of -- on this project in a certain area, that's the law.

But let me just -- you know that President Obama wants to eliminate earmarks, and particularly in the stimulus. And I think it will carry over to the reauthorization of the Transportation bill. And I --

SEN. MCCASKILL: I know that President Obama wants to eliminate earmarks. I want to make sure the secretary of Transportation also wants to eliminate earmarks.

MR. LAHOOD: Well, let me just repeat what I said, Senator. I work for President Obama. I work for the American people. And I'm going to work in collaboration with the Congress.

Nobody has more of a healthy respect for Congress than Ray LaHood. I've been a member for 14 years. I served as a staffer for 17 years. I have over 30 years working for Congress. And I have a healthy regard for what all you do. I know how it works. It's hard work.

I'm going to work with you and I'm going to work with the chairman; I'm going to work with the Committee to fashion a bill that makes sense for America, that funds the infrastructure needs of America. And if it doesn't have one earmark, that's not going to cause me any heartburn.

SEN. MCCASKILL: Good. (Laughs.) Good.

I think you are a terrific choice. I think it's great that Senator -- President Obama selected you, because I spent a lot of time telling America that we were going to have a bipartisan Cabinet, and I'm glad we do.

And I hope you'll forgive me that my first question felt confrontational, but it's something I feel very strongly about and I look forward to working with you and the administration in the weeks to come on eliminating the -- this "let the strongest be the most powerful" when it comes to spending public money.

MR. LAHOOD: Well, thank you, Senator. I certainly wasn't offended by it at all, and I meant what I said. I have the highest regard for the Congress and what you all do. And I always will. You'll always be a priority, always.

SEN. MCCASKILL: Thank you. Thanks, Mr. Chairman.

MR. LAHOOD: Thank you.

SEN. ROCKEFELLER: Thank you, Senator.

Senator Warner.

SEN. WARNER: Thank you, Mr. Chairman.

I want to go back to the three points that I've raised earlier, Representative LaHood. And first of all, let me acknowledge I -- this first question is more -- you haven't even got in there yet -- got your arms around a very, very large department.

But, given my prior experience as governor and working somewhat over the last couple of years on this issue, the complexity of the 11 agencies that fall within DOT, that structure seems to be pretty much set up in 20th century structure.

And as we move, particularly towards this -- what I hope will be one of the directions of more looking at a project on a multi-modal basis, the funding streams and the revenue streams that come out of these specific agencies don't always intertwine.

As you look -- in your term as secretary, will you look at the structure of the Department in terms of how we can advance these more 21st-century goals, like multi-modalism?

MR. LAHOOD: Absolutely, Senator. I think what you're going to find is that I'm going to be very hands-on, and the Department will know I'm going to be very hands-on.

I'm going to get all these modal administrators together and I'm going to explain to them very clearly, we have a mandate from President Obama to get things done with as less bureaucracy and less red tape. We want to put people to work; we want to make sure that we -- carry out the mandates of Congress on Amtrak and on FAA.

But I'm going to pull people together and I'm going to make them work hard, and we are going to work hard. And if it means eliminating something here or there or combining a few things, it'll be done.

SEN. WARNER: Thank you. The second part kind of goes from the structure to the metrics. And again, I think Senator McCaskill and Senator Wicker was raising issues about accountability.

I do think there's oftentimes a lack of knowledge at a lot of policymakers' levels on what the metrics of evaluation are going to be. Again, I think back about the old BMT standards and others. You've talked about a livability standard. There's conversations about a mobility standard.

My hope -- and this would be -- have to be done fairly quickly, but as you look at some of the projects that are going to come out of the president's reinvestment act, I would love that some of those projects, on almost a kind of a beta test model, might be evaluated on some of these new metrics so that as you get to the reauthorization bill later in the year, you had some new metrics out there that are going to take into account accountability and are going to take into account livability, mobility, these -- I think, again, they're 21st- century ways we're going to measure our infrastructure investment.

MR. LAHOOD: You have my commitment to do that, Senator. I think it's very important. We need to really move into the 21st century on some of these things, and I think the reauthorization bill is going to allow us to do some of these --

(Cross talk.)

SEN. WARNER: -- looks at a whole new way of highway projects.

MR. LAHOOD: Absolutely. Absolutely.

SEN. WARNER: -- so that we've got more agreement --

MR. LAHOOD: Get more value --

(Cross talk.)

SEN. WARNER: -- policymakers in terms of value.


SEN. WARNER: And you've raised the issue, and I appreciate your comments and Senator Hutchison's comments about the tolling. I do think public-private is going to have to be a piece of this and, I would add, Senator Klobuchar's idea that laying dark fiber while you're putting in the roads is something we tried in Virginia, with some mixed success there. But it makes an enormous amount of sense and is one of those areas of public-private.

But my hope, as a state that's been kind of out there on the leading edge of public-private partnerships in transportation for more than a decade, that as we look at these initiatives on the public- private side that we make sure that the private party has actually got capital at risk and skin in the game.

There've been too often proposal -- that came by my desk as governor that had the private partner looking good at the first blush, but taking none of the risk and getting all the rewards on the back end.


SEN. WARNER: In other words, we look at public-private, which oftentimes involves tolling, making sure that they've got skin in the game's very important.

MR. LAHOOD: I'd like to use your expertise on that and see if we can make it happen. And being a part of this Committee, I think it will be a priority.

SEN. WARNER: Thank you, sir.

MR. LAHOOD: Thank you.

SEN. : Thank you, Senator.

Senator Begich.

SEN. BEGICH: Thank you very much, Mr. Chairman. I have one kind of parochial, for Alaska, and then I had just some general ones; I added a couple more questions.

But, you know, the big project for Alaska and for this country, I believe, and actually President Obama's put it on his top-five list of the green job creations in the future, is the Alaska Natural Gas Pipeline, which will be thousands of jobs, a lot of investment, but will benefit this country greatly.

With that project, there's about $2 billion worth of road projects, infrastructure that's necessary to construct that project, to get material to the sites. Is that something that you'd be willing to work with the Alaska delegation, to figure out how to solve that first piece, so we can then move to this larger, $40 billion project?

But it's -- roads and bridges are part of the equation. We can't get the project moving without those reconstructions or new constructions to move the equipment, move the construction material. Is that something that you'd be willing to work with us on, to get this mega-project forward?

MR. LAHOOD: Yes, sir. And I don't know if you're in a position now, that it's ready to go and could be a part of the stimulus. But that's -- if it is, then that's --

SEN. BEGICH: They all -- it's all been ready.

MR. LAHOOD: Well --

SEN. BEGICH: We'll talk.

MR. LAHOOD: Absolutely.

SEN. BEGICH: Okay. I'll leave it at that. I'll take it -- because there's -- you're halfway there, so I don't want to blow it, so I'll take it. (Laughter.) So --

MR. LAHOOD: I guarantee you, you won't blow it, Senator.

SEN. BEGICH: Okay, good. But they have been ready and --

MR. LAHOOD: Yeah, good.

SEN. BEGICH -- good jobs.

The other one, just to put on the record for you. I'm probably not one of those big fans for tolling, but we can have that discussion. I think it hurts the working people the most, when they go on toll roads. But I know we have to be innovative in the future, how we deal with roads.

And I would like maybe in the reauthorization -- you know, as we look at this economic recovery bill, one of the big problems is going to be -- and I know that when you mentioned governors, as a former mayor, we love the state, but we love local governments, because we can deliver projects faster, more efficient, and we know exactly what projects can be done as quickly as possible.

My biggest concern with the economic recovery bill is just that. It's going so much to the state bureaucracy that the amount that they take on the DOT on the state level will knock 15 (percent), 20 (percent), maybe as much as 30 percent out of the project for just adding an overhead, and then it will trickle down to local governments who then have to deliver these projects.

So I have some grave concerns over that in the sense of how the economic recovery bill is moving forward, but in the longer term, when the reauthorization of the highway bill comes up, I honestly think the system is broke in the sense of deliverability of these projects, and I'll just give you one. In Alaska it was a pretty significant project because we did it with our money -- went through wetlands, did a lot of things, but we met all the environmental requirements. The environmental community was very satisfied with the end project. We shaved off a year and a half off of that project, saved $2 million, because of the difference in the regulatory process. And I would like to work with you and whoever to try to figure out who we solve this problem, because if you talk to any mayor -- and I talked to 200 of them on Monday across this country -- this is a significant problem, how to deliver money in regards to the highway funds.

As we reform it, we have to reform the bill to deliver these projects in a timely manner and the federal system just doesn't do it, and that's just -- from six years as a mayor and meeting with 200 mayors this week, it's a big message. And I hope you will look toward mayors also for your advice and get some good ideas about how to deliver those projects.

MR. LAHOOD: Can I just say something about local government? And you may know this, but in Los Angeles County they just passed a referendum -- the voters passed a referendum to provide an enormous amount of money for infrastructure in Los Angeles County. Now, to me that's thinking outside the box, and that's obviously local government leaders who have a lot of credibility with local taxpayers that they're willing to raise their taxes because of the very point that you're making; the money never gets to that because, obviously, you know, places like California and every state has huge -- you know, huge financial problems.

So the point is -- I know the mayors and local elected officials, we've heard from them and we know they're not happy, but as you know, President Obama wants to get this money out. There is a mechanism to do that. It goes back to what Senator Warner said, that we have to get the bureaucracy of DOT to make sure that people are held accountable, that the money is spent properly, and that it can get out the door and that people can be working this summer. I know what you're saying, though, Senator.

SEN. BEGICH: One quick one, because I'm watching the clock tick here, but we're doing the largest -- in Anchorage, Alaska we're doing the largest light conversion project for street lights in the country. It will save us about 1.6 million (dollars) a year in energy costs. It will -- the investment will be paid back in five to seven years. And would you be willing to look at a national standard, because the DOTs don't do that, and there is a huge consumption of energy with street lights throughout this country with federal highway systems. Would you be willing to look at a national standard that we can consider implementing to create energy-efficient lights on all the highway systems?

MR. LAHOOD: Yes, sir.

SEN. BEGICH: Great. That's all. Thank you, Mr. Chairman.

SEN. ROCKEFELLER: Thank you, Senator Begich. I'm going to close this now for two reasons. One is a vote has started. The vote, incidentally, is on the nomination of Senator Clinton, who evidently isn't going to get the same treatment as you are. (Laughter.) And I want to say, in my first opportunity to chair a Commerce Committee hearing, I could not be more proud to have done so with you as the witness. You have an ability to answer questions in such a straight- ahead, you've been through it already, you understand, and a cooperative way because of 30 years of experience with the legislature, and I suspect probably because of your own good DNA and good humor and a lot of experience. I'm tremendously pleased about you having been our first nominee.

MR. LAHOOD: Well, Senator, thank you for the courtesies.

SEN. ROCKEFELLER: Okay. And with good luck you're already in there. (Laughter.)

MR. LAHOOD: Well, I like those words too, Mr. Chairman.

SEN. ROCKEFELLER: The hearing is adjourned.

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