Segment 2 Of 2     Previous Hearing Segment(1)

SPEAKERS       CONTENTS       INSERTS    
 Page 9       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
RURAL INFRASTRUCTURE INVESTMENT

Monday, November 22, 1999
House of Representatives, Committee on Transportation and Infrastructure, Washington, D.C.

    The Committee met, pursuant to call, at 12:05 p.m., in the White Lecture Hall, North West Arkansas Community College, One College Drive, Bentonville, Arkansas, Hon. Bud Shuster [Chairman of the Committee] presiding.
    The CHAIRMAN. The Committee will come to order.
    We are meeting this afternoon to hear the testimony of a variety of important transportation issues affecting rural Arkansas. In rural areas across the nation, highways are literally economic lifelines linking workers to jobs and connecting businesses to national and, yes, today international marketplaces.
    The level of interest in these subjects is clearly evidenced by the large contingent of numbers we have here today. In fact, I think we have more of our Congressional members attending this hearing today than we often have when we have hearings in Washington. So it is quite a testimony to the importance of this area.
    I would ask unanimous consent that Congressman Blount be permitted to sit with the Committee this afternoon. Without objection, so ordered.
    I certainly want to welcome all our witnesses and thank you for being here today as we examine these important issues. My intention is to yield to the Ranking Democrat, Mr. Rahall, for a brief statement and then to Mr. Hutchinson, Asa Hutchinson, who is our host and who is doing an absolutely superb job on our Committee and in the Congress.
    And so I would yield to Mr. Rahall at this point.
    Mr. RAHALL. Thank you, Mr. Chairman. I do wish to commend you for scheduling this hearing today to examine rural infrastructure investment here in the heart of western Arkansas. It is always a pleasure to be in this fine state and I appreciate the opportunity to be with your distinguished representation in the United States Congress as well.
 Page 10       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    During my last visit here in May of 1990, I guess it was, I said at that time that Arkansas is a predominantly rural state just like my home state of West Virginia. As you can imagine, therefore, I feel right at home, and therefore, I can say we feel your pain. I just wish I could also say we feel your gain.
    But more important, today's hearing will address a number of core infrastructure issues that are encountered throughout rural America. We will be hearing from a number of Arkansas experts in this area and, indeed, it will help us as we develop a strategy within our Committee in the future for addressing both the infrastructure needs and the financing thereof in rural America.
    So again, I commend you, Mr. Chairman, for holding these hearings. It is a delight to be in Representative Hutchinson's district and to be with Representative Marion Berry as well. Thank you.
    The CHAIRMAN. Thank you very much. And I am pleased to recognize our host, Congressman Hutchinson.
    Mr. HUTCHINSON. Thank you, Mr. Chairman. I want to express my appreciation for your willingness to come to northwest Arkansas to conduct this field hearing and your leadership on transportation issues. I also want to express my appreciation to Representative Rahall for his willingness to come, and all the members that are here. It is extraordinary that you can get over 10 members of Congress to come out to any field hearing. I believe we have 11 that have been participating today in various ways, and each one of these members has given up something to be here, part of their Thanksgiving break. We just had an exhausting session and so I want to express my personal appreciation to each member for conducting themselves and bringing themselves down to my district.
    I also want to thank those who have traveled from different parts of Arkansas to be here. Particularly I want to note the presence of members of the Arkansas Highway Commission, officials of the Arkansas Highway Department, the Good Roads Council, the I–49 Build the Road Committee, chambers of commerce that are represented here from across the district and state, mayors and county judges throughout the state, industry leaders and representatives from the Little Rock Corps of Engineers and the Federal Highway Administration.
 Page 11       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Each of us knows that the success or failure of a particular area of the country depends upon the ability of its residents to maximize the use of their local resources to create a thriving economy. I am proud to say that northwest Arkansas is a shining example of a region where hard work, ingenuity and planning have paid off. Located here are an impressive array of industries, and some of the best recreational opportunities in the Nation exist in northwest Arkansas. We have Wal-Mart, J.B. Hunt, Bekaert Steel, Tyson's, the University of Arkansas, Eureka Springs has a great retirement area, as does Bella Vista. As a result, this area is one of the fastest growing regions in the country. However, just as the keys to creating a thriving economy are ingenuity and hard work, the key to maintaining a region's strength is ensuring that access to the rest of the country and the world is readily available. And it takes modern highways infrastructure to accomplish that and provide that type of access.
    I wanted to just briefly, Mr. Chairman, talk about some of the region's priorities. These distinguished panels that you will be introducing will be covering its needs in greater detail, but you have designated, Congress has designated through the TEA 21 and the ISTEA legislation, two high priority corridors that crisscross my district. One is designated the number one priority, I–49, which is a north-south route. And just to illustrate, the truck traffic is up on that stretch of highway between 1993 and 1997, up 44 percent. We also have another high priority corridor which is 412 running east and west across the northern section of the state.
    Federal highway turnback revenues and earmarked appropriations have provided a strong start for our infrastructure needs in the state and in this region. We have just completed a 42-mile segment of the Fayetteville to Alma section of what is now designated as 540, which will be part of the future I–49. We have also, through the work of our Highway Commission and Highway Department, constructed portions of Highway 412 to interstate quality, but these are very small segments that have been developed. The TEA 21 funding increases jumped Arkansas's turnback funds over $300 million per year, which is a $55 million increase per year than under the previous legislation.
 Page 12       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    And so I think where we are today is that if you look at our present funding mechanism, you are going to look at perhaps 20 years or more to construct these major highways that are necessary, these high-priority corridors. Right now, the Arkansas Highway Commission has done extraordinary work in developing, reconstructing our interstate highways, trying to improve our road system. The Governor has worked extraordinarily well in developing a good highway plan. But the high-priority corridors, Mr. Chairman, are still not a part of the highway funding plan of the Arkansas Highway Commission. I hope that we can move into that category because that is going to be what is necessary in order to complete these projects in an earlier fashion.
    The testimony today will focus also on the innovative financing alternatives that are being created under TEA 21. So I hope these opportunities will allow us to accelerate the building and construction of these highways.
    I think also though we have to look at what is going to happen down the road. I happen to believe, as I believe the Chairman does, that earmarked funds are appropriate sometimes. That is how we have got a number of projects completed in Arkansas. I hope that the Congress will look at the additional revenues, the growth revenues that might come in, over and above the allocation back to the states right now, and consider using them as additional high-priority funds because we need that additional assistance to develop these projects. I hope the state will look at alternatives as well in making these high-priority corridors a part of the state highway system that will entitle those corridors to turnback money from the State of Arkansas.
    Mr. Chairman, this is an impressive array of witnesses that you will introduce. I am very grateful for each one of them sharing their time. I know that we are joined by Vice Chairman John Lipton of the Highway Commission, John Tyson, David Glass from Wal-Mart, Sheridan Garrison and Mr. McCown. So Mr. Chairman, I will yield back my time, but I wanted to thank them personally for giving of their time to present their testimony.
 Page 13       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The third panel also will be focusing on intermodal needs. We have a river that is very valuable in Arkansas, the Arkansas River Navigation System, and I think that panel will illustrate how important it is to our infrastructure, or transportation needs, even on this side of the mountain. So I look forward to their testimony as well.
    And Mr. Chairman, I yield back.
    The CHAIRMAN. Thank you very much. The Chair would note that without objection, all members may put their complete opening statements in the record and the Chair would also like to note the presence of the distinguished John Paul Hammerschmidt, former member, actually my predecessor on our Committee, and my mentor as well. We certainly are pleased to see you again, Congressman Hammerschmidt.
    If there are no other opening statements, we will move directly to our panel of witnesses. Witnesses are reminded that their oral statements are limited to four minutes, with the understanding that their full written remarks will be made a part of the official hearing record.
    With that, I am pleased to recognize our first panel. Please proceed as you see fit. Mr. Lipton, you are listed first, so——
TESTIMONY OF JOHN M. LIPTON, VICE CHAIRMAN, ARKANSAS STATE HIGHWAY COMMISSION; JOHN TYSON, CHAIRMAN, TYSON FOODS, INC.; DAVID GLASS, PRESIDENT AND CEO, WAL-MART STORES, INC.; F.S. GARRISON, CHAIRMAN, AMERICAN FREIGHTWAYS CORPORATION; AND ANDY MCCOWN, PRESIDENT AND GENERAL MANAGER, BELLA VISTA PROPERTY OWNERS ASSOCIATION

    Mr. LIPTON. OK, Mr. Chairman. First of all, let me say welcome to Arkansas. This is quite a feat for us to have such a distinguished group here today. We applaud Congressman Berry and Congressman Hammerschmidt for their work in getting you here.
 Page 14       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    I am going to enter my remarks, Mr. Chairman, for the record, and I will kind of——
    The CHAIRMAN. So ordered.
    Mr. LIPTON. —summarize what I am going to say here today.
    Ladies and gentlemen, let me remind you that Arkansas was one of the first states in the Nation to complete its interstate system. We have seen quite a benefit over the years, and yet we find ourselves with an interstate system that is deteriorating, and we applaud you once again for your thoughts on innovative finance with such things as GARVEE bonds that we are in the process now, for informational purposes, of doing a major maintenance to the interstate system here in our state.
    I would like to preface what I might say by telling you that some say we have the worst state in the Nation as far as our interstates are concerned. This will be a major move, hopefully in the right direction, to get these interstates under repair.
    I would like to tell you a little story here that has led to a lot of things that are happening in Arkansas. Our Commission, the Arkansas Highway Commission, went out a few months ago and we went across the state of Arkansas and we held some 16 regional meetings across this state. At that time, we identified about $7.2 billion worth of highway improvements that were needed over the next 10 years. In addition to that, another $3.6 billion would be needed to develop Arkansas's Congressionally designated high-priority corridors, Corridor 69, we refer to Highway 71/I–49, Corridor 1, Corridor 18, along with Highways 412 and 63.
    We also feel that we are very fortunate that we did have, with the help of the Congress, the extension of a new interstate in the part of the state that I am from, southern Arkansas, where now we have an interstate down to the Pine Bluff area, I–530, with some $100 million to extend that on down into the vicinity of Monticello, Arkansas from Pine Bluff. That $100 million will go a long way, since it is coming out of the general fund instead of the highway trust fund.
 Page 15       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    With the enactment of TEA 21 and this $7 billion worth of needs, we in Arkansas have about $4 billion worth of revenue to go against that, leaving us a shortfall of about $3.5 billion per year, which, in pretty easy terms, if you look at that over 10 years, you are looking at about $350 million a year in shortfall.
    To kind of move us along and to speak specifically to the corridors, we had this major need that Congressman Hutchinson, Congressman Dickey toured some of us on making a little trip from our northern part of our state on down through Texarkana and exiting Arkansas on what we commonly refer to as Interstate 49 or Corridor 1, basically from Kansas City to Shreveport and on to New Orleans. A major segment of Corridor 1 in northwest Arkansas was opened to traffic as a four-lane interstate type route earlier this year, at a cost of about $450 million. To say the least, we did not have those dollars in hand, but we did take revenues from other portions and other projects in the state to finish this particular project that was started.
    The CHAIRMAN. I thank you very much, Mr. Lipton. I see your time has expired and they are signaling me, but your entire statement will be put in the record.
    Mr. Tyson, we are certainly pleased to recognize you now.
    Mr. TYSON. Congressmen, distinguished ladies and gentlemen of the panel, I am glad to be here with you today. You see my comments are on record and I would like to have them entered into the record, and will speak then from my heart.
    The CHAIRMAN. Without objection, so ordered.
    Mr. TYSON. I grew up in northwest Arkansas and I remember in my early days having to take the bus from Springdale to Fayetteville on a two-lane highway. Then this community reached out and built a four-lane highway from Springdale to Fayetteville, then on to Rogers and Bentonville. I call these the little can openers of life because it starts to open up a region to economic growth. It starts to give the chance for a rural area to expand and grow. And then we had the good fortune to have U.S. 71 expanded and became a four-lane highway, which has allowed for growth in northwest Arkansas.
 Page 16       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Being an agricultural company, you always have the debate between the growth of the urban economy up against rural agricultural issues. I stand before you to say that any and all economic growth for a region is a right and proper action.
    Northwest Arkansas, southwest Missouri, northwest Louisiana, we all need to be connected with a major corridor that runs north and south. I say this because the east coast has a great infrastructure in place to allow some great economic growth. The west coast has a great economic structure and infrastructure in place for economic growth. We here in the midwest need to have the opportunity to take advantage of the great economic growth here in the United States of America.
    And if we can find a way to link the northern part of the United States, from Minnesota down through Missouri through western Arkansas on into Louisiana, we start to put another can opener in place which allows the midwestern part of the United States to grow, to prosper and to take advantage of all the great strengths that the midwest has to offer in the United States.
    We move a lot of product, we move a lot of trucks around. Our trucks are large, our trucks are heavy. Any time we can improve our infrastructure to make the roads safer for the folks that work for me and make them safer for the communities that we are in, we ask that you consider that. Sometimes we have to come to Congress and ask that you jump start projects to get a region up and going. We did that with U.S. 71, we have done that with the interstate down to Fort Smith, which has made a significant difference in safety and in time travel.
    We need your help in extending the corridor west on 412 going east towards Memphis. We need your help in extending the corridor in going north up into Iowa and on up into Minneapolis. And we need your help in going south along I–49, along the western side of Arkansas, on into Louisiana. If we can connect all of those dots together, then you give the midwestern part a chance to participate in the great economic country called the United States of America.
 Page 17       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    I ask that you consider the remarks of the panel that I am part of here and I give you some time back, Mr. Chairman.
    The CHAIRMAN. Thank you very much, Mr. Tyson. Mr. Glass.
    Mr. GLASS. Thank you, Mr. Chairman. I also would ask that my remarks, written remarks, be entered into the record in their entirety and I will attempt to summarize——
    The CHAIRMAN. Without objection, so ordered.
    Mr. GLASS. —here today.
    In 1990, the Transportation and Infrastructure Committee began its work to draft legislation to improve the highway system. A field hearing of this Committee was convened in northwest Arkansas at that time, and in 1990, Chairman Shuster, you and Congressman Rahall were here for that hearing and heard Sam Walton, Don Tyson, J.B. Hunt and others present testimony about the need to improve the transportation infrastructure in the region and to build our first four-lane highway connections to the interstate system. And Sam said at that time, as you may recall, that for the first time Wal-Mart would pay more than one billion dollars in Federal income taxes and asked that a little of that be returned to Arkansas to build new and better highways, so that we could be even more productive and pay even more taxes.
    As a result of that hearing and others like it around the country, the Committee took the first step to improve northwest Arkansas highways with I–49 corridor and Highway 412 corridor. Now, almost 10 years later, we can report a solid return on your investment. Employment in the Third Congressional District is up 33 percent, total annual earnings of our people have increased 83 percent since 1991.
    Just a snapshot of how business investment in northwest Arkansas impacts the infrastructure, an example would be Wal-Mart Aviation. We have a corporate aviation department that flies out of northwest Arkansas some six million miles a year. It is a bare bones operation designed to move our people around the country and we average some 200 flights a week, 100 passengers a day, to help us conduct our business other places. Our logistics department is located here in northwest Arkansas and we connect all of our distribution centers from here. We operate a transportation division that consists of some 4300 trucks, traveling 600 million miles per year, making 1.2 million deliveries. And I will tell you that no highway in America was more welcomed on completion than Interstate 540. This highway serves the region of the state as our economic link to the rest of the nation.
 Page 18       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    We owe a debt of gratitude to Congressman John Paul Hammerschmidt and this Committee in particular, without whose leadership and determination that highway might never have been built. We appreciate the efforts in getting the highway trust fund off budget and, Mr. Chairman, we ask that you and the Committee continue to make priority investment of highway trust funds. I believe this region of our country will continue to show excellent returns on your continued investment and I can assure you that Wal-Mart will continue to help maximize that investment by improving the quality of life for our customers and communities throughout the United States.
    Thank you.
    The CHAIRMAN. Thank you very much, Mr. Glass. Mr. Garrison.
    Mr. GARRISON. Mr. Chairman, Congressman Hutchinson, Congressman Berry, other distinguished members of the Committee, I am Sheridan Garrison, Chairman of American Freightways Corporation, a publicly held company headquartered in Harrison Arkansas, population 11,600. So we are in rural America.
    We serve direct all points, 32 states. This year, we will accumulate 435 million miles, a significant portion of which is in rural America. If we can get a truck to it, we serve it. For many rural customers, our company is the only regular service provider they have. We serve every point in every Congressional District of every member of Congress here today.
    To substantiate our service to rural areas, I will read the directions for a shipment we delivered Friday to Mr. Jim Weir of near Witts Springs, Arkansas. ''From Witts Springs, follow 16 towards Tilly. Before you get to Tilly, take a right on 27, go approximately 15 miles, take a right on old 27, go about eight miles to the Y, turn left, follow old 27 until you come to a very long field. On the right, look for a mailbox with Weir on the mailbox and turn left. If you get to a large brand new white house overlooking the field, you have gone too far. Turn left across from the mailbox, go eight-tenths of a mile to the house, honk your horn and ring the dinner bell on the back of the house.''
 Page 19       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    [Laughter.]
    Mr. GARRISON. Now that should illustrate that we serve rural America.
    Our all-points service makes us uniquely qualified to speak to the highway needs of rural America. American Freightways believes that serving rural America is just good business.
    Mr. Chairman, I am pleased to be a constituent of Congressman Hutchinson, who serves this District with distinction.
    No single highway initiative is more important to this region of our state than the John Paul Hammerschmidt freeway, sometimes referred to as Interstate 540. For this monumental project and for the improvements to U.S. Highways 412 and 65, we will forever be indebted to the man who served this District so well for 26 years, Congressman John Paul Hammerschmidt, and to you, Mr. Chairman, and many of your colleagues here today.
    I am grateful, Mr. Chairman, for your leadership on many issues, including the passage last week of the Motor Carrier Improvement Safety Act, or Safety Improvement Act of 1999, which trucking supported. Thank you, sir.
    Now U.S. 412 is significant in that it is the major east-west route between I–44 on the north and I–40 on the south and it is significant because it is the only feasible east-west route across northern Arkansas. For many rural towns, it is the only access to the outside world. Your improvements to U.S. 412 are much appreciated, but for the record, much remains to be done.
    Mr. Chairman, for several consecutive years, we have lowered the frequency of truck involvement in highway deaths significantly. We are entering a new era for safety improvement which involves intelligent vehicle systems, ITS or IVS—whatever. American Freightways presently successfully operates three different intelligence systems and has placed an order for testing and evaluation of 50 combination collision warning systems and data recorders, sometimes referred to as black boxes.
 Page 20       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    A viable rural highway system will cause rural America to become more accessible and become more attractive for residential, industrial and commercial purposes. That process will disperse our population and therefore, alleviate some of the congestion problems that we all experience in and near the major cities.
    Mr. Chairman and members of the Committee, thank you for your patience while receiving my remarks.
    The CHAIRMAN. Thank you very much, Mr. Garrison. Mr. McCown.
    Mr. MCCOWN. Mr. Chairman and members of the Committee, I am Andy McCown, I am the President and General Manager of the Bella Vista Property Owners Association. My comments have previously also been submitted for the record.
    The CHAIRMAN. Without objection, they are included in their entirety.
    Mr. MCCOWN. Bella Vista is an unincorporated community of approximately 15,000 residents, located just south of the Arkansas/Missouri state line along U.S. 71 and just north of Bentonville. We are primarily a retirement and recreation community with a great majority of our residents being 55 and older.
    The community continues to grow, adding approximately 300 new homes each year. In addition to its residents, approximately 31,500 lots are owned by people who do not reside in the community, but who have a significant impact on its traffic patterns as they travel to the community for recreational purposes.
    One of the community's major concerns is the ever-increasing traffic along U.S. 71. The highway serves as the primary north-south highway for our residents. Most of the commercial buildings in the community are located along the highway and it is the primary facility providing access to those areas. In addition, U.S. 71 also serves as a primary north-south highway for commercial freight moves. Major companies such as J.B. Hunt, Wal-Mart and Tyson are all active industries in this area that truck a large portion of their commerce through this corridor.
 Page 21       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    I would like to give you some statistics on traffic and safety in this corridor. This information has been taken from the Draft Environmental Impact Statement for this project.
    Using figures from this study, on the Missouri portion of this highway, traffic is estimated to increase from 12,600 vehicles per day in 1996 to 23,700 vehicles per day in the year 2020. South of the state line through Bella Vista, traffic is expected to increase in that same time period from 13,000 to 28,300 vehicles per day for a 118 percent increase.
    I also personally believe that these figures may be somewhat low. In 1996, the base year for this analysis, Highway 540 had not been constructed to the south to connect to Highway 40. The area had not yet begun to experience the tremendous growth and development that is occurring today. The new regional airport serving northwest Arkansas only opened this year and will undoubtedly spur accelerated growth.
    In regards to traffic safety, again from statements taken from the draft environmental report, utilizing five-year historical data provided from the highway department, the figures show that U.S. 71 from the state line through Bella Vista had 197 accidents and the two-lane route through Missouri had 221 accidents during that five year period. These rates are approximately 200 to 250 percent higher than similar facilities within the respective states.
    In addition, you need to understand the nature of the typical Bella Vista driver creates additional traffic hazards. Typically elderly drivers have slower reaction times than the average driver and tend to be involved in a higher portion of accidents.
    Accordingly, within the last year, two traffic signals have been installed on U.S. 71 through our community and another is scheduled for installation in the next six months. These signals will provide for better safety, but will also affect significantly the slowing of traffic through the area and will create the inconvenience, especially for truck traffic, of a constant stop and go situation.
 Page 22       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    For all these reasons, I would urge the Committee and others involved with the decision to construct the bypass and to make every effort to place the highest priority on this construction and make funds available as soon as possible.
    On behalf of the Bella Vista community, I thank you for hearing my testimony and for taking the time from your busy schedule to conduct this hearing.
    The CHAIRMAN. I want to thank all of you very much for your testimony. One question I have is what is the state gas tax, how many cents?
    Mr. LIPTON. I believe we just increased it, we have gone from I believe 18.5 up with three cents, one penny per year gasoline tax, gets us into around a little better than 21 cents per gallon.
    The CHAIRMAN. The difference between ISTEA which we passed and TEA 21 for Arkansas is an increase of $83 million a year. Do you feel that you have the adequate state funds to match that increase?
    Mr. LIPTON. We do to meet that increase, Mr. Chairman, but the needs are out-shadowed. And I agree with what Congressman Hutchinson said a little later, for a state like Arkansas to do what we need to do to really open it up, all segments of it, we are going to have to have the high priority corridor money. You people in Congress are going to have to bring the bacon back, so to speak, to enable us to do what needs to be done.
    Geographically speaking, we are almost at the center of the nation, and it seems like truck traffic is increasing in our state, it certainly leads us to believe that we are a gateway, and when we look at the NAFTA corridor, Mr. Chairman, and looking at the net rate of return on it of $1.55 for every dollar you expend, with eight states involved there and Arkansas being a benefactor there to some degree—if we can ever tie this together, we feel very comfortable that we will see a lot more Garrisons, we will see a lot more like the Wal-Mart people and the Tyson people who, I do not have to say, we are very proud because they seem like they stay up very high on the Fortune 500.
 Page 23       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The CHAIRMAN. In some parts of the country, they put together what are called public/private partnerships, finding ways for the private sector, which also benefits, to help finance the construction of highways. Particularly in southern California this is being done, as well as in some other parts of the country. Has that been considered at all?
    Mr. LIPTON. I think that is some of your new innovative financing that we are looking at. You know, we are going to have to look at all avenues, Mr. Chairman—GARVEE being one. We are utilizing that, but with the shortfall we have, we are going to have to get a lot more innovative than what we have been in the past, in order to meet the needs of the future.
    The CHAIRMAN. Thank you very much. Mr. Rahall.
    Mr. RAHALL. Mr. Chairman, I would like to yield my time directly to the gentleman from Arkansas, if that is all right.
    The CHAIRMAN. Fine. Mr. Berry.
    Mr. BERRY. Thank you, Mr. Chairman. I first of all want to thank you for holding this hearing and the Ranking Member Mr. Rahall, I know that you all both understand how important transportation infrastructure is, certainly with the passage of TEA 21 and our passage in the Committee and in the House of AIR 21.
    I would like to note that there are some 40 members or attendees here from northeast Arkansas. You may have noted, Mr. Chairman, that they came in late, after the meeting had already started. The reason for that was because they had to come over here on 412.
    [Laughter and applause.]
    The CHAIRMAN. If the gentleman will yield for a moment. I understand Mr. Bland is a spokesperson for that group and if there is time at the end of our panels, I would be happy to allot some time to him. So we will plan to do that if there is time.
    Mr. BERRY. Thank you, Mr. Chairman. With that, I will yield back the balance of my time.
 Page 24       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The CHAIRMAN. I thank the gentleman. Mr. LaTourette.
    Mr. LATOURETTE. Thank you very much, Mr. Chairman. I will be mercifully brief.
    I do have a couple of questions, Mr. Lipton, but I was struck in the answer to the Chairman's question when you indicated that the United States Congress has to bring back the bacon. One of the great things about this Committee is, under the leadership of Chairman Shuster and the Ranking Member Mr. Oberstar, this Committee has done just that, done what you asked for. Take a look at the pioneering legislation that Bud Shuster wrote a number of years ago, ISTEA and now compared to the TEA 21, I believe that Arkansas, like my home state of Ohio, is receiving 90.5 percent of the tax money that used to go into a black hole in Washington and never made its way back to Arkansas or Ohio or anywhere else. So through the leadership of two great members of your delegation who serve on our Committee, Mr. Hutchinson to my right and Mr. Berry to my left, which is about where they rank in the Congress—to my right and left on a regular basis——
    [Laughter.]
    Mr. LATOURETTE. —they are already doing that. And I think that what you find here in Arkansas is not all that unusual from the rest of the Union. Again, if you look at our European competitors and our Asian competitors, they will spend close to a trillion dollars over the next 10 years on infrastructure, and here in the Congress we fight over $32 billion a year, which is what the gas tax raises at 18.3 cents, the Federal gasoline tax.
    So ways have to be developed, not only from Washington, but also innovative ways within the states. So the gentlemen from business, I would like to follow up on the Chairman's question, he talked about public/private partnerships, and I will tell you, in Columbus, Ohio, there is a concern known as the Limited, and they sell clothes and they also have that Bath and Beauty Works so you can go in—well, it is a wonderful store. But anyway, they have Interstate 71 that runs down through Columbus, Ohio and they were very much in need of having an off-ramp so that they could get their trucks and their employees off. And they participated mightily with the Ohio Department of Transportation in a public/private partnership with Federal funds, it was a Congressionally earmarked project to do that. And I guess I would throw it off to the gentlemen from industry, recognizing that the Federal Government will do what it can, I hear the State of Arkansas saying it is going to do what it can. I would be interested in the view of those of you in business in partnering with the governmental agencies to make some of these infrastructure improvements a reality. Mr. Tyson, I would be happy to start with you.
 Page 25       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. TYSON. I think our responsibility, being in agriculture, is to find the right match of putting our private money back up against public money. There has been the debate within Arkansas and it is referred to as the ton-mile tax, it is an ongoing debate, the Vice Chairman here knows about it. In effect it is a tax based on the number of tons that you run across a particular road. It is an interesting debate, I think we in agriculture can consider it as long as the consumer is willing to pay for an increased cost in the price of poultry. Once you go up against that dynamic and once you go up against the fact that poultry, by nature, is the lowest cost protein provided the consumer, we run into what is the real responsibility of all of us involved coming to a conclusion. Right now it seems we settle out on a cents per gallon type tax, whether it be on gasoline or whether it be on diesel. I think we all concede Arkansas is referred to as a blocking state on the ton-mile tax, when that issue has been raised, for other trucks to come across our state, it becomes an issue of Arkansas called a blocking state because out of state truckers and those struggle with the concept of paying for each ton that is moving from the east coast to the west coast. I think it would have a strong economic impact on our state, positive, but I think it would be a detriment to the rest of the United States and that is why I cannot support a ton-mile tax on a go-forward basis.
    Mr. LATOURETTE. I thank you, Mr. Tyson, and my time is about to expire. I would just add that if it were not for your chicken nuggets, my kids would starve to death, so I appreciate that very much.
    [Laughter.]
    The CHAIRMAN. I thank the gentleman. Ms. Johnson.
    Ms. JOHNSON. Thank you, Mr. Chairman, and thank you for accommodating this hearing. Being from an adjacent state, we actually are close enough that we share a city.
    Rural America is a little different for me, but I understand that there are real transportation needs and some congestion. If you want to know what real congestion is like, drive to Dallas and you will get an idea.
 Page 26       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    I am interested in knowing what the congestion problems are and what you suggest that we do in addition to what we have read here, to solve it and how it can be creatively financed. And anyone can comment.
    Mr. GARRISON. I used all my creative financing up whenever I started American Freightways.
    [Laughter.]
    Mr. GARRISON. And I do not mean that smart-alecky, but I do mean that by the time we get through paying our highway user taxes and our Federal income tax, we have very little left to serve our investors. So I do not really know of anything my company could do other than pay those primary taxes. We certainly do not have the money to take a passive position as an investor in a public/private type financing of highways. Sorry.
    Mr. TYSON. You know, I think I would speak, Congresswoman, one of the challenges, and I think one of the reasons we are here today to talk about 412 and I–49 is to put a plan in place before we have to undo congestion. If we can get the system in place, then it is planned and it is laid out. I think time and time again in some of your urban areas, it seems we have to go back and build the roads or build the overpasses because the congestion came and the prior planning was not there. I think that is one of the things we would encourage you to do, to get out in front and anticipate things, then we put the structure in place and eliminate maybe congestion on the front end.
    Mr. LIPTON. Let me just add one thing to that. I think not only in Arkansas but we as a nation probably made a very bad mistake, in my opinion, when we allowed the railroads to get into the situation they are in today, because I have not looked at any chart that does not show anything but direct skyrocketing increases of truck traffic on the roads. The trucks are becoming trains on the roads. These interstates that were built back in the 1950's, the 1960's and the 1970's were not built for the weights we have on them today, nor were they built to carry the capacity and the anticipated increase in the truck traffic we are having on them today.
 Page 27       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    So this congestion is real. And the little stretch of road from Little Rock over to Memphis has probably got as high of a truck traffic as any distance on the interstate of any place in the nation.
    We are at our wits end, Congresswoman, Ms. Johnson, what do we do about this? And it is one that we continually bring back and put on the plate before you in Congress. We applaud you in this state, Chairman Shuster, we were with a group that visited with you before you were ever able to get the tax off budget. Our Commission supported that from the get-go, so to speak.
    The thing of it is the demand is skyrocketing and our revenues on the state side are just not keeping up with the demand.
    Ms. JOHNSON. You are not—you are still in attainment environmentally?
    Mr. LIPTON. Are you talking about from an environmental perspective?
    Ms. JOHNSON. Uh-huh.
    Mr. LIPTON. I think the only area we have, the closest we have is probably Memphis that catches us in that situation.
    Ms. JOHNSON. I see my time is expired.
    The CHAIRMAN. Thank you very much. Mr. Hutchinson.
    Mr. HUTCHINSON. Thank you again, Mr. Chairman.
    In Arkansas, we have highway commissioners that represent Congressional Districts and I did want to introduce Jonathan Barnett. Jonathan, if you would stand—who is Third District Highway Commissioner. And he has served us very well and I wanted to thank you also for going on that bus tour that helped us to focus on I–49. Was there another Commissioner I missed?
 Page 28       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. LIPTON. Our Director Dan Flowers, who was just past President of ASHTO, by the way.
    Mr. HUTCHINSON. Absolutely. Dan Flowers, would you stand? We thank you for your support. And Dan also went on the bus tour with us, really looking at the problems with I–49.
    I come back, Commissioner Lipton, and I agree with you the extraordinary needs in Arkansas and the difficulty of that. And I think you are sensing a little bit from the Committee that, you know, our philosophy has been to return the turnback money to Arkansas and we expanded it to the largest extent possible. The Chairman mentioned I believe it was $75 million——
    The CHAIRMAN. Eighty three.
    Mr. HUTCHINSON. Eighty three million dollars more per year. Now then it is up to you all to allocate that and we set these high priority corridors, but am I correct, Commissioner Lipton, that in the highway plan, the high priority corridors will not receive any of the Federal formula money being turned back to the state?
    Mr. LIPTON. We take that dollar that comes in and certainly we come up with the match from the state dollars in order to match that. I do not believe we have ever failed to match Federal money. As a matter of fact, I think when you had other states turning their money back in in previous years, Arkansas has always gone back for more. We have never failed to match Federal money coming down, Congressman.
    Mr. HUTCHINSON. You are absolutely correct, you have done that. Which means that if we earmark some funds for a high priority corridor, you are capable of matching that with the other Federal formula funds.
    Mr. LIPTON. That is the way and that was the thing that helped us sell the increase in the gasoline tax this past session of the Arkansas General Assembly, was the fact that you brought the Federal money down, that was leverage that we used to tell the state we have to have the state match in order to match this new money that the feds are sending into Arkansas. The legislature and the Governor bought that and approved that. So we can match what you are sending down. Our problem is not enough is coming down to meet the needs of our state.
 Page 29       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. HUTCHINSON. Commissioner Lipton, if the high priority corridor is going to be built, you are saying we have got to earmark the money from Washington to designate it that way.
    Mr. LIPTON. I think—you spoke in terms of 20 years. I like to see results in a short time, I know all of you do. But Congressman, in order to do some of these things we are talking about in a relatively short period of time, getting away from the 20 years, it is going to be almost mandatory that additional Federal money come down in order to allow us to get these things going.
    Mr. HUTCHINSON. I would like to yield to my good friend from Missouri that borders me on the north, who is not a member of the Committee, but is here, Representative Roy Blount, who covers the Springfield area. This is very important to him and I would like to yield to him for a minute.
    Mr. BLOUNT. I thank the gentleman for yielding and I thank the Chairman and Mr. Rahall for letting me sit in on the hearing today. Certainly these are critical issues to us. My Congressional neighbor with the largest border is Congressman Hutchinson and certainly northwest Arkansas and southwest Missouri both in growth and in the quality of the economy are significant images to each other. I see we have got people from Joplin and Neosho and others and our Highway 71 Task Force in this audience today.
    In the last Congress, when I had a chance to serve on the Transportation Committee, Congressman Hutchinson and I cosponsored the amendment to designate I–49 a high priority corridor.
    The CHAIRMAN. The gentleman's time has expired, but I will recognize the gentleman on his own time when we get to that.
    Mr. BLOUNT. Thank you, Mr. Chairman.
    The CHAIRMAN. Mr. Thune.
 Page 30       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. THUNE. Thank you, Mr. Chairman.
    Let me just say, in my state we raise beef and you guys raise chickens, and I wish we raised more beef and you raised less chicken or at least that is what the cattle ranchers I represent would probably say.
    But both of them have to have good transportation and I come from a rural state, we rely heavily, and this Committee, under the leadership of Chairman Shuster, has been very good in seeing that rural states, I think, are adequately funded to do the things that we need to do.
    The way that we do it in South Dakota is we have a five-year plan and in order to get funded, if you have got a project or anything in your transportation system in South Dakota it has to make it on the five-year plan. And to that degree, I guess my question would be, I am not sure what your process is down here, but if in fact, I–49 corridor and the 412 are on the Arkansas state plan, if that is something that has been elevated to a level where it is receiving the consideration at the state level, because the Federal dollars that come out on the formula obviously are going to be plugged in as your Commission, the way your process works and the way ours works in South Dakota, makes those decisions. We are limited to what we can do in terms of actual earmarks, we have a limited amount of money that we can earmark and obviously these are funding needs that probably exceed our ability to earmark for specific projects at the Federal level. But our state, if you get a project on a five-year plan, could use those formula dollars then for a high priority corridor.
    I guess my question would be is it on a five-year plan or do you have a five-year plan. What is your process and if so, are these two corridors on there?
    Mr. LIPTON. Let me do this, if the Chairman would allow, to answer the Congressman's question, in order that I do not get off base with what I might say to you, I would ask leave, Mr. Chairman, to let our Director answer the Congressman's question, Mr. Flowers.
 Page 31       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The CHAIRMAN. Fine. Yes, sir.
    Mr. LIPTON. And Congressman, it is not that I do not want to answer you, I just do not want to misspeak.
    Mr. THUNE. That is fine.
    Mr. FLOWERS. Thank you, Mr. Chairman, and members of the Committee, I am Dan Flowers, the Director of the Arkansas Highway and Transportation Department.
    To answer your question, we have in place what we have been operating on since 1991, which is the 1991 Highway Improvement Program. Highway 71 and a number of projects on the corridor have been in that plan. The most notable is one that has been referred to previously, which is the section from Interstate 40 up to Fayetteville. The Chairman is very familiar with that, he was here when we opened a piece of it. That section has been completed. There is other work in the Texarkana area that is well underway.
    Now to put this into some perspective, the 1991 Highway Improvement Program was a 15-year plan. So the piece from I–40 south that we are interested in advancing at this particular time, was not in the 1991 plan, the piece north of Interstate 40 that has been completed, the 42 mile section has been completed. So we have completed that part of the 1991 program.
    What has not been done is start any major construction on the piece south of Interstate 40. It is not that we have been idle on any of this, we have been fairly progressive on pursuing development of the project. We have completed the environmental and location studies, the routes are selected. So we are well on our way and we have some earmarked money that Congressman Hutchinson, and your Committee was good to give us. We will begin design work on certain parts of that section south. So we are working quite actively on this piece of road.
    The CHAIRMAN. Thank you very much.
 Page 32       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. THUNE. Thank you, Mr. Chairman.
    The CHAIRMAN. Mr. Moran.
    Mr. MORAN. Mr. Chairman, thank you, I thank the Committee for being here. I come from a state that I guess your state is named after, although you seem to pronounce it differently down here, it is great to be in Arkansas.
    [Laughter.]
    Mr. MORAN. Mr. Glass, one of the things that I think is important for our country is our ability to compete in a world economy and it seems to me the transportation costs to the business community have a direct impact upon our ability to accomplish that. Do you have an impression just generally what direction our country needs to go in regard to its ability to remain competitive, to have competitive advantage as far as infrastructure needs?
    Mr. GLASS. I think we are becoming a global economy where we have to compete all over the world. We get an unusual perspective here in Arkansas, because we run our entire operation out of northwest Arkansas. As someone referenced what other countries spend for infrastructure before, I just made a trip visiting our facilities in Asia and saw infrastructure being built and commitments to build infrastructure that a lot of what we do pales in comparison. They are simply committing more of their resources to get it done. They understand that you have to have that to compete and when I look at what we are doing and the costs of doing it, it is something that deserves a lot of attention, but rather than playing catch-up as we are doing in many parts of the country, we need to get out in front.
    Had the decisions not been made in 1991 or thereabouts to do some of the things that have been done in northwest Arkansas, we would not have made the progress we have made today. And yet I think northwest Arkansas is a great example of the free enterprise system and capitalism and all those good things at work.
 Page 33       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    We, as a private business, engage in the development of infrastructure, whether it is off-ramps as we were talking about the Limited awhile ago helping in Ohio, we do a lot of that, but there just needs to be I think a greater commitment and a plan that gets us out in front more, if we are going to compete globally with all the other countries that are making those same kind of commitments.
    Mr. MORAN. There is no question but what transportation costs, infrastructure needs, impact our ability to compete. Is that accurate?
    Mr. GLASS. It is absolutely accurate. And if we do not make some commitments, additional commitments, then those costs will go up and we will be less competitive in this country.
    Mr. MORAN. Mr. Tyson, I see that certainly in the agriculture community that I represent, our ability to provide wheat to the world, for example, is in many ways dependent upon our cost of delivering those goods to market. And railroads and trucks are awfully important to us. I assume your analysis would be similar to Mr. Glass'.
    Mr. TYSON. I am in agreement. We find it interesting being in the agriculture business, that when we wanted to locate some plants and facilities, we had to match them up against the railroad and not against the trucking or the interstate system. And that is why some locations in effect went to different places such as Tennessee or into Alabama because the railroads moved there and it was easier to match up on the railroad than matching up against the trucking system. If we had had good interstates or highways, we probably would have been a little bit closer to Kansas and Nebraska and South Dakota. But we had to kind of say where are the railroads because at that time they had the low cost point of delivery of the commodity that we needed.
    Mr. MORAN. I appreciate the fact that soybeans seem to come your direction from our state, and we appreciate the market.
 Page 34       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. Glass, my home community is receiving a new Superstore and we are requesting our State of Kansas for additional dollars to four-lane the highway to connect with your store.
    [Laughter.]
    Mr. MORAN. So we understand——
    Mr. GLASS. Great, thank you.
    Mr. MORAN. —the process that you all go through with Mr. Lipton.
    Mr. Chairman, thank you.
    The CHAIRMAN. Thank you very much. Mr. Blount.
    Mr. BLOUNT. Thank you, Mr. Chairman.
    Mr. Chairman, when Mr. Hutchinson and I began to serve on the Transportation Committee, I think we followed in a great tradition of Gene Taylor and John Paul Hammerschmidt, and when Gene Taylor retired from the Congress in 1988, I think he would have been surprised if the prediction would have been that we still would not be linked up with Highway 71 in the year 2000, 12 years later. That is obviously not going to happen. You know, because of the highway fatality rates that somebody has mentioned in testimony here today, Mr. McCown I think, and other reasons, we need to get that done.
    Congressman Thune and I are obviously a lot more concerned about north-south travel than we are east-west travel in Arkansas, so I want to ask a couple of questions about Highway 71 either to Mr. Lipton or Mr. Flowers. And one is, moving from where the I–49 corridor is now finished, when do you expect—to the Bella Vista area, when do you expect to be linking up with the Missouri border and when are we going to make a decision as to where that link-up location should be?
    And the Chairman runs a fast gavel, so I may——
 Page 35       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. LIPTON. I understand and from my ability to answer you, I can just say that a major segment of Corridor 1 northwest Arkansas opened to traffic of a four-lane interstate type earlier this year. But you are asking about designated interstate 540, the segment opening 71 to Bella Vista?
    Mr. BLOUNT. Yes.
    Mr. LIPTON. To provide service to seven of the nation's largest trucking firms, largest retailer, Wal-Mart, largest poultry producer, Tyson sitting here with us.
    Mr. BLOUNT. When do you think that is going to happen?
    Mr. LIPTON. It is a matter of dollars and I would say to you right now if you were looking to us to have to do this with state dollars, you know, in proportion—in some proportion to Federal dollars, we are a long way off. What we probably are in a position of doing right now is nothing more than probably matching what you sent down, Congressman, as far as your high priority corridor money is concerned. Now we will match that. But you are talking in terms of how do we accelerate this. And I would say from our Commission's perspective, we would turn and look at you and say, Congressman, how do you intend to accelerate this.
    Mr. BLOUNT. I think the $3 million amount in the study to determine how you are going to go around Bella Vista, what is the time frame on spending that money?
    Mr. LIPTON. Mr. Flowers, if you would, Mr. Chairman.
    The CHAIRMAN. Sure.
    Mr. LIPTON. I do not want to misspeak.
    Mr. FLOWERS. Mr. Chairman, Mr. Blount, we have an environmental location study well underway on the Bella Vista bypass. We have used part of that $3 million, we still have a little left. We are nearing being able to get a record of decision on the route. So as far as that part of the project development, we are pretty close. We are within a reasonably few months of being able to get that part done. Then we will have to move on into right-of-way design and right-of-way acquisition.
 Page 36       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. BLOUNT. Mr. Glass, what is it about the stocking and the way people do business now that has created more truck rather than rail traffic?
    Mr. GLASS. Well, the rail traffic is almost non-existent for retailers today, everything has moved to trucks, and it is more a switch from rail to trucks. And the growth in the economy, this is the best economy that any of us has experienced, at least in my lifetime, and all of that coupled together, the absence of inflation, which creates additional goods and services to be moved, just compounds the problem.
    Mr. BLOUNT. Thank you, Mr. Chairman.
    The CHAIRMAN. Thank you very much. And gentlemen, thank you very much for your testimony. We certainly do appreciate it.
    I am pleased now to call the second panel, Mr. Page, who is accompanied by Mr. Dooly and Mr. Lee.
    And I understand only Mr. Page is going to testify. Am I correct, gentlemen, that only Mr. Page is going to testify and he is accompanied by you other gentlemen?
    Mr. PAGE. That is correct.
    The CHAIRMAN. Fine. All right, Mr. Page, you may proceed at will.
TESTIMONY OF SASHA N. PAGE, VICE PRESIDENT, PROJECT FINANCE, INFRASTRUCTURE MANAGEMENT GROUP, INC., ACCOMPANIED BY BILLY B. DOOLY, PRESIDENT, FORT SMITH CHAMBER OF COMMERCE, AND ROBERT SWEDE LEE, PRESIDENT, TEXARKANA CHAMBER OF COMMERCE

    Mr. PAGE. Good afternoon. I would like to thank you, Mr. Chairman, for inviting me to testify today before the Committee on the benefits of innovative finance and I–49. My written comments have been previously submitted for the record as well.
 Page 37       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    My name is Sasha Page and I am a Vice President for Project Finance of Infrastructure Management Group, IMG. IMG is a financial advisory firm based on Bethesda, Maryland, which advises public and private groups of ways to make funding of infrastructure; that is, highways and airports, a reality in light of tight public budgets, through use of innovative finance and the private finance markets.
    IMG was asked earlier this year by the I–49 Road Building Coalition, led by the Chambers of Commerce of Fort Smith and Texarkana, to help assess the I–49 financing options. In the time available, I would like to share some of the findings that show how to realize this project in 10 years and not in the original estimate, which was four decades. These findings are also relevant for other Arkansas projects, including Highway 412 and I–69 and other projects in other states.
    Sitting beside me are Mr. Billy Dooly, President of the Fort Smith Chamber of Commerce and Mr. Robert Swede Lee, the President of the Texarkana Chamber. These two men represent a large grassroots group of local citizens who strongly support the I–49 project. Indeed, you have heard some of those speak previously.
    Even when infrastructure projects are financed with a minimum of public monies, it is essential to have a strong public support, such as from this coalition, since there are many non-financial issues for which this project will need to draw upon for political capital, not just financial capital, to make it a reality.
    Last month, IMG completed its initial study of I–49 and presented the findings to communities along the corridor and to several officials of the Arkansas Highway and Transportation Department. Here are the financing options that we recommended.
    First, your Committee has provided important tools to allow innovative finance to work for I–49 in the TEA 21 legislation and its predecessor ISTEA. For instance, TEA 21 encourages the issuance of GARVEE bonds. Through a GARVEE bond, a state can pledge anticipated Federal highway aid grants to bondholders to support near-term projects. With this technique, the project can be built much sooner than under a traditional pay-as-you-go approach.
 Page 38       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    As you have heard, Arkansas is among the states taking a lead in utilizing GARVEEs, having authorized $570 million worth of bonds last June. They will be primarily used for emergency repairs of existing interstates. It is our recommendation that the state use some additional portion of its more than $5 billion GARVEE capacity to support I–49.
    Second of all, a tool that originated from your body is the State Infrastructure Bank or SIBs. SIBs are designed to allow states to leverage Federal funds by allowing them to place a portion of Federal aid monies into a separate account to be loaned out in a variety of ways. SIB loans are paid back by revenues generated by the project or other local fees.
    For I–49, we are recommending that the Arkansas SIB be further capitalized. As I–49 repays a loan, the Arkansas SIB can relend these monies to other projects in the state like Highway 412 or I–69. We need your help, however, in improving the SIB program. We hope that you will relax the TEA 21 restrictions, which currently limit the use of new Federal funds from capitalizing SIBs, that is except for four states where they are allowed.
    A third tool that we recommend is that a design-build approach be applied to I–49's construction. Design-build is a procurement method in which the state solicits delivery of an integrated package of engineering and construction services, usually at a set price with performance specifications rather than a fully specified design, as is common.
    The CHAIRMAN. Mr. Page, while your time has expired, your entire statement will be put into the record.
    Mr. PAGE. Thank you.
    The CHAIRMAN. But let me anticipate what you might be going to next and let me ask you, you covered the various modes, what about tolls? To what extent do you see tolls as an option?
    Mr. PAGE. Yes, we also see tolls as a significant option as well. The financial markets have financed toll roads for many years now, but only recently they have been financing new start-up toll roads. For instance in southern California, there have been some great successes. And we hope with that precedent of existing toll roads plus the TIFIA program, which supports projects like new start-up toll roads, there will be a good basis in the financial markets to take this project to financial markets and finance part of them with tolls, if not all of them.
 Page 39       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The CHAIRMAN. Thank you very much. Mr. Rahall.
    Mr. RAHALL. Mr. Chairman, I will yield again to the gentleman from Arkansas, Mr. Berry.
    Mr. BERRY. Thank you. I would just recommend at this time, Mr. Chairman, that Mr. Bland come forward and make his statement.
    The CHAIRMAN. Unless he is tied into this same group, we are going to invite him at the end. We have another——
    Mr. BERRY. That is fine. I do not have any questions, Mr. Chairman.
    The CHAIRMAN. All right, thank you. We will have Mr. Bland come after the third panel, assuming there is time. It was not listed on the schedule, but we will certainly be happy to try to accommodate him.
    Mr. LaTourette.
    Mr. LATOURETTE. Thank you, Mr. Chairman.
    Mr. Page, I have had a chance to read your report and I have to say that it is one of the better prepared reports that I have had the chance to see. And I would just ask you—I understand the restrictions in TEA 21, limiting the State Infrastructure Bank to four, but what are the obstacles that keep—Arkansas has a State Infrastructure Bank, do they not?
    Mr. PAGE. They do, that is correct, but they are not one of the four states that can use TEA 21 monies.
    Mr. LATOURETTE. No, but they are free to use state or any other money to capitalize their State Infrastructure Bank, are they not?
    Mr. PAGE. That is correct.
    Mr. LATOURETTE. Again, it has been our experience in Ohio that the use of the State Infrastructure Bank has given us the ability to leverage funds and complete projects way ahead of time.
 Page 40       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    You also mentioned design-build and again, the use of design-build, which is again an innovation forged under the leadership of this Chairman and this Committee, can not only save money, but it can accelerate a project. And I would just give you an example in my district. They said we were going to build a bridge and it was going to take five years to first design it, then to build it, then to come back and do some more stuff. Well, using design-build, we have now accelerated that to 18 months. And that has the opportunity obviously, when you shrink the time, you also have the opportunity to save money as well.
    I did not see, however, and this is my question, I did not see in your recommendations the opportunity for local communities—and I see the gentlemen from the local communities, the Chambers of Commerce, to use their own sweat equity. That is, the engineering and design work perhaps that may exist in a city planning department or city road department, to be used as the qualifying local match to leverage both Federal and state funds for these projects. Is that something that is used here in Arkansas? And if not, why not?
    Mr. PAGE. Let me defer to Mr. Billy Dooly, but I believe consideration is being given to use lands from the existing Fort Chaffee for part of a local match.
    Mr. DOOLY. We already have on Fort Chaffee, Arkansas, 7500 acres returned under the BRACH 96 and under that, we have the route, the environmental and all have been done connecting with I–40 on south to DeQueen, Texarkana and to Louisiana and Texas. And that portion across there, probably 9.5 miles, is already there and that can be used for that purpose.
    Mr. LATOURETTE. Thank you very much. Thank you, Mr. Page. I yield back, Mr. Chairman.
    The CHAIRMAN. Mr. Hutchinson.
    Mr. HUTCHINSON. Thank you, Mr. Chairman. And before I ask Mr. Page a question, I wanted to really express my appreciation to Mr. Dooly and Mr. Lee, representing both ends of I–49, Fort Smith and Texarkana, that have been so committed to this project, and their respective Chambers supporting it to such a great extent.
 Page 41       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    I believe, Mr. Dooly, you have a special tie on there?
    Mr. DOOLY. We all three do, sir.
    Mr. HUTCHINSON. I think that is a Build-the-Road tie that has a map of the route for I–49 and they have asked me, Congressman Shuster and Rahall to give you each a tie. I will present it to you——
    The CHAIRMAN. Thank you.
    Mr. HUTCHINSON. —to remind you of the location that we hope to build.
    Mr. Page, one thing—and I agree with Congressman LaTourette that your report was well done and I have studied it over. And obviously we need to have more funds to be put into a State Infrastructure Bank or to support TIFIA bonds. One of the things that you mentioned was dedicating the sales tax for new and used cars for road construction, whether it be through the State Infrastructure Bank or to support TIFIA bonds. And I guess the theory is that, you know, the cars are driving on the roads, and I think you said that some states are doing that. How many states do that and what obstacles do you face in trying to do something like that?
    Mr. PAGE. I am not sure how many states are doing that, several of them are using motor vehicle taxes and other local taxes in a variety of ways—a lot of creative examples out there.
    I think what it demonstrates, both to the state and Federal levels as well as to the financial markets is that there is strong local support. And as I said earlier, that is very important when we bring these kinds of deals to the financial market. They not only want to see that the numbers work, they also want to see that there is that strong groundswell.
    I will refer, also in answering to Mr. LaTourette's suggestion, there are SIBs that take advantage of only state and local funds. In fact, in South Carolina, they use a hotel tax to help repay SIB loans that are actually funded by the state itself. So there are a lot of good examples of local support and a lot of creative ideas out there.
 Page 42       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. HUTCHINSON. Do you have intention of presenting—have you presented your report to the Highway Commission?
    Mr. PAGE. Yes, we have. Last month we presented it to several members of the Highway Commission and we have provided them with the full contents of the report.
    Mr. HUTCHINSON. Thank you. I yield back, Mr. Chairman.
    The CHAIRMAN. Thank you. Ms. Johnson.
    Ms. JOHNSON. Thank you very much, Mr. Chairman.
    Can you name any particular states or locations that are using public/private partnerships right now, that you might be working with, and what ratios and the costs of projects?
    Mr. PAGE. Well, let me give a couple of examples. For instance, one good example of a SIB where there is a good use of SIBs is in Texas. In Texas, the Texas SIB has done a fantastic job of supporting some of the NAFTA projects, the Lorado Bridge project, for instance. That is not a public/private partnership, but is a very innovative way of using the SIB money and constrained financing.
    I think a good example is in Salt Lake City for construction of the infrastructure for the Olympics, using the design-build approach, a partnership with local construction firms, the state DOT has obtained fantastic construction time schedules to make that project—those projects realizable within short time constraints and really under budget, what they were expecting to pay.
    There are a number of projects all around the country, a whole variety of them. In fact, worldwide, there are a lot of examples. I think what is interesting is that there is a lot of creativity in these. I think the legislation that is under TEA 21 really allows a lot of flexibility and the question now is just to take advantage of that.
    Ms. JOHNSON. Thank you, Mr. Chairman.
 Page 43       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The CHAIRMAN. Thank you very much. Mr. Thune.
    Mr. THUNE. No questions, Mr. Chairman.
    The CHAIRMAN. Mr. Moran.
    Mr. MORAN. No questions.
    The CHAIRMAN. Mr. Terry.
    Mr. TERRY. No questions.
    The CHAIRMAN. Mr. Blount.
    Mr. BLOUNT. Thank you, Mr. Chairman.
    Mr. Page, when I asked the Commission about their funding plans, they talked about more funding from the Federal Government. Have you put in your proposal some things that we need to do to make the tools that you have talked about that are in TEA 21 more accessible to Arkansas or is that largely just up to the Commission here and even if you want to expand that to the Missouri Commission. What can we do to accelerate the use of these various new measures to get I–49 accelerated?
    Mr. PAGE. I think as I mentioned, funding the SIB program, reducing the restriction on the SIB program, would be very helpful for Arkansas and I believe for the other 30-plus states. I think your Committee and the Congress has done an excellent job in giving us the tools in TEA 21. I think we need to get the word out and I think it will be very helpful if you can help publicize those programs more.
    I think supporting programs like TIFIA, making the financial markets confident that these are good programs and continuing to fund the highway authorization bills as you have. Giving the program stability is what is going to give the financial markets and investors confidence.
    I think there are billions of dollars of private investors who fund toll roads, start-up toll roads, in the country and it is really their indication of their faith in the risks in these kind of roads. I think continuing the good programs that you have developed is the right way to go.
 Page 44       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. BLOUNT. Thank you, Mr. Chairman.
    The CHAIRMAN. Thank you very much. And I thank you gentlemen very much for your testimony today.
    I am pleased now to call the third panel—General Van Winkle, Mr. McWhirt, Mr. Gordy and Mr. Brain.
    You gentlemen may proceed in the order your name is listed here. Would you like to proceed, General?
TESTIMONY OF MAJOR GENERAL HANS A. VAN WINKLE, DEPUTY COMMANDER FOR CIVIL WORKS, U.S. ARMY CORPS OF ENGINEERS; RICK MCWHIRT, PLANT MANAGER, BEKAERT ROGERS PLANT; LUKE GORDY, CHAIRMAN, VAN BUREN PUBLIC FACILITIES BOARD; AND SID BRAIN, CHAIRMAN, RIVER VALLEY REGIONAL INTERMODAL FACILITIES AUTHORITY

    General VAN WINKLE. Yes, Mr. Chairman, thank you. I am accompanied today by Col. Tom Holden, who is the Commander of our Little Rock District, he is sitting behind me.
    I am pleased to appear before the Committee today to discuss important transportation and navigation issues with this Committee and I would really like to make three points.
    First, I will highlight the importance of ensuring our waterways are properly interconnected with other transportation modes. Then I will point out that aggressive repair of our aging inland waterway structure is as important as aggressive repair of our highways if we hope to maintain the transportation infrastructure that facilitates growth in our global commerce. And finally, I will illustrate these with a few examples from McClellan-Kerr Arkansas River Navigation System.
 Page 45       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Inland waterways are a crucial part of the nation's transportation infrastructure, one of several important modes. Waterways offer the Nation energy efficiency and cost effectiveness. Bulk commodities can be moved by barge for about 97 per ton mile, compared with $2.53 by rail or $5.35 by truck. Now I am not suggesting for a moment that we can do without rail or truck, quite the contrary. It takes all available transportation modes working together in an intermodal approach, each doing the things it does best. Interconnectivity of ports, rail lines and highways is the key to keeping America competitive in a global marketplace.
    The McClellan-Kerr Arkansas River Navigation System provides a valuable transportation route linking ports of several riverside cities here in Arkansas as well as in Oklahoma with the ports of the world. During the past six years, commerce on the river has shown a four to five percent annual growth rate, reaching an estimated 11.9 million tons in 1998. By tapping intermodal rail, truck, and barge, the states of Colorado, Kansas, Oklahoma and Arkansas are directly involved in interstate and international commerce, especially of our agricultural commodities.
    The major ports along the system are keenly aware of these benefits. For example, in Russellville in 1997, the Mayor requested the Corps to study the feasibility of a commercial harbor and the Little Rock District has been doing that.
    Regarding the maintenance of our aging infrastructure, this is a challenge facing the Corps and the Nation today. The infrastructure maintained by Little Rock continues to grow in value. It cost about $1.3 billion to build and today it would cost $6.5 billion to replace at today's prices.
    The Corps will always strive to do its best to maintain this crucial infrastructure, but our current system of breakdown repair is not the best method. This method, often called the bandaid approach, keeps getting bigger and more expensive. There just is not enough money to do all that is needed. Project supervisors in the Little Rock District are reporting they are finding increased maintenance challenges and what COL Holden sees, verifies these reports. We will continue to budget for the most crucial items and look for the most effective ways to use our maintenance funds. Some of the specific challenges in maintaining a navigation channel on the McClellan-Kerr are being addressed, but others require more work.
 Page 46       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    A topic of interest to the Committee is the high flows on the Arkansas this year during the extended wet spring. These flows were primarily caused by releasing flood waters from the lakes of Oklahoma and they did impact the ability of industry to move commerce. Congress this year provided $1 million to initiate the study that will examine ways to reduce impacts on our navigation from high flows.
    In the meantime, low flows have also created challenges. A ten-mile long White River entrance channel connecting the McClellan-Kerr Waterway with the Mississippi River caused some problems. River depths in this reach are directly controlled by the stages of the Mississippi and off and on during the past several years, changes in that stretch of the Mississippi have caused river stages in the entire channel to drop lower than they have been in the past. This has caused repeated channel restrictions in the entire channel and we are currently looking at a solution being developed in Montgomery Point Lock and Dam. And that work is currently underway.
    Well, in summary, I think I have highlighted the importance of our waterways. I have said that we need to increase the repair of our aging infrastructure and have addressed a couple of issues in Arkansas. Thank you, Mr. Chairman.
    The CHAIRMAN. Thank you very much, General. Mr. McWhirt.
    Mr. MCWHIRT. Mr. Chairman, member of the Committee, as plant manager of the Bekaert Rogers plant, I am here to state the importance of the Arkansas River and the Port of Van Buren to northwest Arkansas and the Bekaert Corporation.
    Bekaert Corporation is a multinational company based in Belgium that focuses on the manufacturing of steel wire product. Bekaert has two plants in Arkansas that use the Arkansas River and the Port of Van Buren.
    The Bekaert Rogers Plant in northwest Arkansas began operations in 1990 and currently employs 250 people who produce steel cord for radial tires. The main raw material for producing steel cord is wire rod, which is 100 percent supplied to the Rogers plant by way of the Arkansas River. Wire rod is shipped from the manufacturers in two forms and they are lash barges and river barges. Both types of barges are received at the docks in Van Buren and then the wire rod is loaded to trucks for delivery to the plant. Barges—water is used to transport wire rod that is used in the manufacturing of steel cord for two reasons. First of all is the cost. Wire rod that is shipped by river has a transportation cost of 35 percent less than trucking. And the second reason, which is more important, is the quality. Transportation by truck increases the amount of handling and has a greater effect on removing the protective scale coating on the wire rod than when it is transported by water. In addition, truck transportation increases mechanical damage to the wire rod such as surface scratches and abrasions. It should also be noted that this is the main reason why train transportation is not used.
 Page 47       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Bekaert Rogers was located in northwest Arkansas due to access to the Arkansas River and the Port of Van Buren. Over the last nine years, the plant has continued to grow, doubling the production output from its original design. It is Bekaert's concern that the Arkansas River and the Van Buren port will be able to keep up with our growth and our needs.
    Thank you.
    The CHAIRMAN. Thank you very much. Mr. Gordy.
    Mr. GORDY. Mr. Chairman, members of the Committee on Transportation and Infrastructure and distinguished guests, I am Luke Gordy, I'm a banker by profession but I am here today in my capacity as the Chairman of the Van Buren, Arkansas Public Facilities Board.
    For the past five years, we pursued the evaluation of an intermodal port facility for western region of Arkansas. And thanks to the hard work and persistence of Congressman Hutchinson and Senator Tim Hutchinson, we received funding in the amount of $270,000 from the TEA 21 Federal transportation funding legislation, to conduct a formal feasibility study for this project. Subsequently, a $300,000 contract has been negotiated and signed with Don Breazeale and Associates, a consultant of Rancho Santa Fe, California, and work has begun on this project.
    At this juncture, I want to take a moment to make what I think are a few very important points about this.
    First, we have, from the very outset, been committed to a public/private partnership approach. Before we approached government for funding assistance for this study, we secured private sector partners to provide matching funds necessary.
    Next, we have constantly stressed that this is a feasibility study and not a justification study. We are not interested in a ''build it and they will come'' scenario. Our study must indicate that revenues must more than support costs before we move one step further.
 Page 48       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Thirdly, even though the Van Buren Public Facilities Board is acting as the administrative entity for this study, this is not just a Van Buren project. Our feasibility study's primary mission is to evaluate the economic feasibility for an intermodal port for our region, regardless of the appropriateness of the location within the Fort Smith/Van Buren/Barling/Lavaca River Valley area in Arkansas.
    We have sought and received, thankfully, the advice, counsel and encouragement of the Secretary of Transportation Rodney Slater, our Congressional delegation, members of the Oklahoma Congressional delegation, the Arkansas Highway and Transportation Department, Arkansas Planning and Development District, the Corps of Engineers, other port operations along the Arkansas River, in addition to both transportation providers and transportation users.
    You might rightly ask ''What makes the Van Buren area an appropriate location for a regional intermodal port facility?'' We think there are several factors.
    First, The Van Buren/Fort Smith area has the largest output of manufactured goods in Arkansas.
Secondly, northwest and western Arkansas accounts for the largest growth in commercial and industrial activity in the state.
    And last, but certainly not least, are the unique combination of transportation assets already in place in and around Van Buren. Several transportation corridors, reflecting all modes of transportation, pass through or near Van Buren.
    River experts—and I am certainly not one—but river experts tell me Van Buren is ideally suited on the right or correct side of the river for an intermodal port operation.
    Additionally, the east-west corridor of Interstate 40 intersects with the current north-south corridor of Interstate 540/Highway 71 within our city limits. In our visit with Secretary Slater this past May, we discussed at length our mutual excitement about the synergistic effects of a potential intermodal port coupled with the close proximity of the extension of Interstate 49 south from Interstate 40 through Fort Chaffee and on to the Louisiana border.
 Page 49       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    We have short line rail service in place that provides access to three class one railroads with both north-south and east-west routes.
    The Fort Smith Regional Airport offers the longest public runway in the state of Arkansas and the new Interstate 49 is now a very convenient driveway to and from the new Northwest Arkansas Regional Airport.
    I hope you can see why we are excited about the possibilities of this project and anxiously await the results of our feasibility study.
    Thank you for allowing me to share this information.
    The CHAIRMAN. Thank you very much. Mr. Brain.
    Mr. BRAIN. Mr. Chairman, members of the Committee, thank you for being here. I am Sid Brain, Chairman of the River Valley Regional Intermodal Facilities Authority, located in Russellville.
    Russellville, Arkansas is a community of approximately 25,000 with a trade area of approximately 100,000, located 75 miles northwest of Little Rock on the Arkansas River in Polk County. The commercial and industrial base around Russellville serves a six-county area. The Authority is a joint city-county intermodal authority, established under Arkansas law.
    The project we are discussing today is a regional facility. Three years ago, in the summer of 1996, a local committee was formed to explore the possibility of developing an intermodal facility to better serve existing industry and to enhance the region for industrial transportation development.
    The Arkansas Highway and Transportation Department was asked to study the feasibility of such a facility in this area. That extensive, two-year study concluded that the Arkansas River Valley has the potential for a facility combining water, air, rail and highway transportation modes along with freight handling and transfer facilities and an industrial park for waterway using industries. The report pointed out the area's favorable geographic location to the nation's market areas and the presence of all the national transportation systems.
 Page 50       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    At the same time, the Russellville Airport Commission started exploring the possibility of relocating the existing airport to a location which would allow longer runways and instrument approaches. The site has been selected within the intermodal facility area. This site has received FAA approval of air rights and preparations are being made for an environmental assessment. Site planning and engineering for this study was paid for with $60,000 of local funds.
    In February 1997, we requested inclusion as a demonstration project in the TEA 21 funding bill. We were included for one million dollars for study and development. The Arkansas Highway and Transportation Department is overseeing use of these funds.
    In November 1997, we asked the Corps of Engineers to perform a feasibility study for a slackwater harbor to be part of the facility. This study has been completed at the District level and after a 30-day public comment period, will be sent to Division for final review. The preliminary report shows a very favorable benefit-to-cost ratio.
    I would like at this point to compliment the Corps of Engineers and the Arkansas Highway and Transportation Department. The Corps has been most helpful, their personnel are professional, knowledgeable and patient. We appreciate their approach, it should be a model for all Federal agencies.
    The Highway Department study was complete and professional. Their folks have been supportive, helpful and encouraging and they continue to guide us through the intricacies of using the Federal TEA 21 funds.
    We are interviewing design professionals and expect to award an engineering feasibility contract in January 2000. The estimated total cost of this facility is between $40 million and $50 million.
    We are pursuing all possibilities for additional funding at the local, state and national levels. We are encouraged by our discussions with state and local officials. The possibility of a dedicated local sales tax has been discussed and we feel it has at least an even chance at some point. We have received $10,000 in funding from local industrial development groups and offers of more when we ask, and are hopeful for inclusion in the city and county budgets for a total of an additional $50,000 in the year 2000.
 Page 51       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Thank you for allowing us to share our dream with you and for the funds Congress has provided. We are excited about our project and think it could be a model for intermodal facilities around the country. We ask for your consideration and help in building this model facility.
    The CHAIRMAN. Thank you very much.
    Mr. BRAIN. And I would like for my written remarks to be included.
    The CHAIRMAN. Without objection, so ordered. All complete statements will indeed be made part of the record.
    I am pleased to yield my time to Mr. Hutchinson.
    Mr. HUTCHINSON. You are very kind, Mr. Chairman, and thank you.
    I think that the Committee can see really the cohesiveness of the State of Arkansas by the presentation of the different panels today and I really am pleased that Mr. McWhirt for Bekaert could testify, because here, up in the Rogers area, the extreme northwest corner, Bekaert Steel is utilizing the river for transportation of the raw material for the plant up here and it is trucked over. So it is truly an intermodal enterprise that we are using to carry out our industrial needs and I congratulate you for that work. But it points up the need for expanded intermodal harbor facilities that the communities of Van Buren and Russellville are working on so diligently and both of these communities have poured in some private money. They have worked diligently to build the community spirit for this.
    I wanted to ask Mr. Brain, Sid, you mentioned your intermodal facility and the goals there. What are the highest priority projects that should be addressed first in that? Are you talking about air, rail or what?
    Mr. BRAIN. Well, Congressman, the port, naturally the port is a key; the second—well, they are all high priority really when you have the port, which is well underway under the 107 project, and we expect that to be ready for start of construction in 2001, in the winter, if we come up with our share of the money, which hopefully we will do next fall. We have the extension of B&R Railroad, which is about a $1.5 million situation, we are about a mile away, very high priority. One of the other keys is development of the south bypass to Russellville which is being studied by the Highway and Transportation Department at this time, using Highway 247, which would take the traffic out of downtown Russellville and connect the facility with I–40. The airport is ongoing.
 Page 52       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. HUTCHINSON. In other words, they are all priorities.
    Mr. BRAIN. I would hate—they are all priorities, yes, sir. The port is ahead of the rest and we think that would be the order.
    Mr. HUTCHINSON. Let me shift to Mr. Gordy. Luke, one of the things I am very familiar with in the Van Buren/Fort Smith area is the flooding along the river. Does that impact the ability to bring the barge traffic in?
    Mr. GORDY. The thing about our feasibility study is we are evaluating various sites along the river, we do not have one particular site zeroed in on. So in some areas, yes, it does.
    Mr. HUTCHINSON. Well, one thing that Mr. McWhirt testified to, I think there were two problems, the flooding and then the low water that impacts when you can bring up the barge traffic and that is one of the reasons we got a million dollars for a comprehensive navigational study along the Arkansas River. And General, if you could just comment as to when you think that will move forward and any obstacles that you see in carrying out that comprehensive river navigational study.
    General VAN WINKLE. Right now, we hope to have the study done by 2002. We do not see any problems in that, we have the money, we are looking at it, COL Holden and his crew are addressing that. The second phase of the study would possibly look at some other alternatives, perhaps how to solve some of these problems. So ongoing work, moving along at a good pace.
    Mr. HUTCHINSON. Thank you. I yield back, Mr. Chairman.
    The CHAIRMAN. Thank you very much. Mr. Rahall.
    Mr. RAHALL. I yield my time to the gentleman from Arkansas, Mr. Berry.
    Mr. BERRY. Thank you, Mr. Chairman.
 Page 53       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. Chairman, the First Congressional District of Arkansas is the second largest steel producing district in the United States. That is probably not a good subject to raise in front of my colleagues from West Virginia and Pennsylvania. But it is something we are very proud of and the fact that we have a unique intermodal capacity, I think is one of the reasons that that steel industry has developed there over the last 15 years. And this panel's testimony has definitely highlighted the need for improvements in all forms of transportation and the unique location of Arkansas in the Nation and in the transportation scheme. And especially with our water transportation capacity, it points out the needs.
    I think what we have heard pretty well so far today is that all it takes is money. And what we have got to do is figure out a way to get that money.
    With that, I will yield back the balance of my time.
    The CHAIRMAN. Thank you very much. Mr. LaTourette has no questions, I understand. Mr. Terry.
    Mr. TERRY. No questions.
    The CHAIRMAN. And Mr. Blount has no questions. So we thank you gentlemen for your testimony, thank you very much.
    We do have time now for Mr. John Bland, if you will come forward, please. Mr. Bland, your entire statement will be entered in the record. As with the other gentlemen, you are recognized for four minutes, if you might want to summarize your statement.
TESTIMONY OF JOHN BLAND, PRESIDENT, PARAGOULD 2020

    Mr. BLAND. OK, thanks, Mr. Chairman. Congressman Hutchinson, Congressman Berry and my good friend, Congressman John Paul Hammerschmidt, who helped so diligently, and I want to thank the entire panel for giving us the opportunity to present our story.
 Page 54       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    As was discussed earlier, at 5:30 this morning, a group of my closest friends from all across north Arkansas boarded a bus and we have traveled from towns throughout the entire state. I would like for them to stand if they might. Would my friends from north Arkansas stand.
    [Members of the audience stand.]
    Mr. BLAND. We come from Viola, Cherokee Village, Hardy, Highland, Mountain Home, Harrison, Jonesboro, Marmaduke, Salem, Melbourne, Paragould, Bono, Walnut Ridge, Brookland, Pocahontas, Craighead County, Randolph County, Greene County, Lawrence County, Sharp County, Fulton County, Baxter County, Izard County, Marion County and Boone County. And we are all here to support the four laning of Highway 412 across the entire state of Arkansas.
    As you can see, and we can all attest, 412 is important to us. We came from as far east as you can come, Congressman, almost to the boot heel of Missouri, we are about eight miles from there. And we came over this morning and we are supportive of four laning 412 for a few reasons.
    Number one, the number of fatalities that have occurred on highway 412 in the last ten years. One fatality is too much and there have been numerous ones.
    One of the reasons we were late, and again, I want to apologize, was we got behind some of those Tyson trucks and some of those Wal-Mart trucks on the way over.
    [Laughter.]
    Mr. BLAND. And it is hard to get up and down those hills on two lane roads and for a bus to pass them.
    But there are three primary reasons for 412 being four laned across the entire state. As I mentioned, number one, safety.
    Number two, we have some of the most pristine lakes and rivers across north Arkansas and they are tourist destinations for people all across the mid-America corridor and this corridor for 412 goes from Nashville, Tennessee to Tulsa, Oklahoma, and people from all over the country travel that corridor going to our pristine lakes and rivers. And so we would like to boost tourism across the state of Arkansas and this corridor will help do that.
 Page 55       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    And finally, as has been attested by almost everyone here today, economic development will be enhanced by the four laning of 412 across the state of Arkansas.
    412—an important statistic, approximately 20 percent of our population lives on 412—lives in counties with 412 as the primary east-west corridor. So a fifth of the population is very dependent on 412 across the state of Arkansas.
    I want to thank all of you again for the privilege of speaking before you. I want to thank the state of Missouri and the Missouri Department of Transportation, they are supportive of the four laning of the bridges across the St. Francis River into Missouri and four laning of 412 from Arkansas into Hayti, Missouri.
    Again, I want to thank you for the opportunity. We certainly appreciate it. We drove a long way and we appreciate it very much.
    The CHAIRMAN. Thank you very much. I will yield my time to Mr. Hutchinson.
    Mr. HUTCHINSON. Thank you again, Mr. Chairman.
    John, thank you for traveling the distance today to illustrate the problems with 412 and the need for the construction of that. It is appropriately designated a high priority corridor, it needs to have that consistent support both in Washington, this Committee, but also, as has been demonstrated by the Arkansas Highway Commission, so we are fully supportive of that and thank you for sounding the alarm loud and clear and for my good friends from Mountain Home that are here and Harrison that are supporting this.
    Mr. Chairman, if I might, I just wanted to thank Mr. Bland for his presentation. I did want to introduce John Susky and Ernie Fossett with the Good Roads Coalition, I believe they are here.
    The CHAIRMAN. Would they stand up please, if they are here.
    [Members of the audience stand.]
 Page 56       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    Mr. HUTCHINSON. I just wanted to acknowledge them.
    The CHAIRMAN. Thank you for being here, gentlemen.
    Mr. HUTCHINSON. They have been very, very supportive of all this.
    And we have had the Bentonville/Bella Vista Chamber that has been supportive; Lane Kidd, the Arkansas Motor Carriers are here, Lane, are you here? And Ken O'Donald with Northwest Arkansas Planning and Development Committee was here also. Van Buren/Russellville Chamber of Commerce. So clearly, so many people are here supporting these different projects and making the case to the Committee.
    And again, I want to thank my colleagues from the bottom of my heart for their effort in being here today. With that, I yield back, Mr. Chairman.
    The CHAIRMAN. Thank you. Mr. Berry.
    Mr. BERRY. Thank you, Mr. Chairman. I would just second what my colleague from northwest Arkansas has just said. We appreciate you and Ranking Member Rahall, this entire Committee being here, being in Arkansas and recognizing the needs. I know that you do not have to have them explained, there is not a greater champion for infrastructure creation than this Committee under your leadership and Mr. Rahall's leadership. We thank you for being here.
    John, I want to thank you and all the group from northeast Arkansas for being here and showing your support for building these roads and the other infrastructure that we need. We appreciate all of you.
    Mr. BLAND. Thanks, Congressman.
    The CHAIRMAN. Thank you. Mr. LaTourette.
    Mr. LATOURETTE. No, sir.
    The CHAIRMAN. Mr. Terry.
    Mr. TERRY. No.
 Page 57       PREV PAGE       TOP OF DOC    Segment 2 Of 2  
    The CHAIRMAN. Mr. Blount.
    Mr. BLOUNT. Mr. Chairman, just thank you again for letting me join your Committee today. What is good for northern Arkansas is almost always good for southern Missouri and I am glad that you took time to look into these problems here at this location.
    The CHAIRMAN. Thank you. And if there is nothing further, we stand adjourned.
    [Whereupon, at 1:45 p.m., the Committee was adjourned.]

    [Insert here]