were supported by the United States and should assure that our

carriers' operations are not disadvantaged, compared to their

international competitors, as they strive to reduce their

greenhouse gas emissions.

Finally, the Department's initiatives to reduce emissions of GHG's will be very much in line with the direction the Congress has recently set for us in the TEA-21. Many of the new or innovative programs, such as the Transportation and Community and System Preservation Pilot Program, the Surface Transportation Environmental Cooperative Research Program, and cooperation on advanced vehicle development, contain goals that are compatible with the Kyoto Protocol goals in the transit area. The Intelligent Transportation Systems, Congestion Mitigation and Air Quality Improvement and transit formula and discretionary

programs also help meet these goals. In particular, TEA-21 authorizes some $42 billion, which will mean many thousands of

These

new jobs all around the country, besides supporting more efficient, environmentally friendly urban transportation. programs contain, in essence, the goals of ensuring that our transportation system remains both efficient and environmentally friendly and guaranteeing that our transportation decisions now

16

do not preclude options for future generations.

This concludes my testimony. I would be happy to respond to any

questions you may have.

Mr. MCINTOSH. Thank you, Mr. Horsley.

Let me ask you, first, what is the Department of Transportation's estimate for the increased cost to Americans of gasoline for their motor vehicles under the Kyoto Protocol requirement of a 7 percent reduction from the 1990 levels?

Mr. HORSLEY. OK. To the best of my knowledge, we at the U.S. Department of Transportation are relying on the forecast and analysis done by the Council of Economic Advisors as reflected in Dr. Yellen's testimony. So I would have to rely to that.

Mr. MCINTOSH. Did the Department do any independent or analysis on its own?

Mr. HORSLEY. Mr. Chairman, I will check into that and be glad to respond back in writing.

Mr. MCINTOSH. If so, I'd like to know what that analysis indicated.

In particular, was there an analysis of what the cost would be if there were no trading provisions?

Mr. HORSLEY. Again, Mr. Chairman, I'll be glad to respond to that. The analysis that I recall being briefed on showed a potential increase in the gasoline sector of somewhere in the range of 4 to 6 cents.

Just anecdotally, I traveled up to New Hampshire over the 4th of July recess. On my way up, filled up in New York where regular was $1.21 a gallon. On the way south, fueled again in Jersey where the cost was 97 cents. I was out in Los Angeles this last Friday where a friend fueled up at a $1.39 a gallon, and myself filled my tank at home in Virginia at 99 cents. So there's 40 cents variation around the country today. And so the nickel or the 4 to 6-cent increase that Dr. Yellen's forecasting and way in the future, at this stage, it's very hard to speculate on what the impact may be.

Mr. MCINTOSH. And her estimates were greatly diminished because of the assumption that virtually all of the cost would be avoided through the implementation of a trading program.

Mr. HORSLEY. That's my understanding.

Mr. MCINTOSH. At least as she explained it to us. And so, if you've got an independent or separate analysis for the Department, I'd be very interested in that. In particular, if it went to the question of what that cost increase would be without those trading provisions.

What are DOT's estimates of the changes that would be in transportation patterns and sees var pools, public ortation patterns and lifestyles for Americans under the protocol? I guess including the use of car pools, public transportation, whether that would increase and the amount of travel by different sectors or vacation purposes, as well as business?

Mr. HORSLEY. Mr. Chairman, as you recall in 1993, when the administration and the Department was analyzing what we could do to try to achieve some of the goals of the Rio. I'm not sure whether it was a protocol or agreement that President Bush signed, but we laid out several objectives. One of the central components of which was to increase the efficiency of this system and encourage more transit ridership as an example.

And again, with regard to the vote you took on the Transportation Equity Act for the 21st century, $42 billion, record level investments in transit were provided in that bill which we think will

do an enormous positive good in equipping urban areas all over the country and even rural transit systems to be able to offer an alternative to driving alone in single-occupancy vehicles.

One of the challenges that were

Mr. MCINTOSH. Was there any analysis of what percent of ridership would convert over to that in order to meet the goals of Kyoto? Mr. HORSLEY. I have seen no analysis specific to Kyoto. And I'll see if either our Bureau of Transportation Statistics or other branches of the Department have done forecasts.

Mr. Chairman, I think with regard to this question and other questions that may come up, one of the things you'll see consistently in the investments that you have authorized through the Transportation Equity Act and previously the Intermodal Surface Transportation Efficiency Act is an encouragement for the good of the American people here and now to take steps to reduce congestion, improve access, improve mobility. And we think many of those objectives that we're doing for the here and now for the American people directly benefiting them right now will have the beneficial secondary effect of helping us achieve some of the goals set out to reduce carbon emissions and global climate change.

Mr. MCINTOSH. And to meet the Kyoto targets, does the Department anticipate any change in the corporate average fuel economy standard, either for automobiles or for light trucks?

Mr. HORSLEY. Mr. Chairman, it's my understanding that we are under direction for the last three appropriations bills to make no change in the CAFE standards and so we are not. Beyond that, it is my understanding that in the analysis that the National Highway Traffic Safety Administration does with regard to fuel efficiency, that we are to take into consideration the impacts on the broader environment, and I'm sure they do so.

Mr. MCINTOSH. So at this point, the Department would base its policy on the assumption that that rider would continue during the next 10 to 15 years?

Mr. HORSLEY. That's our current guidance, but the one point that I've noticed here in my notes is that the statutory criteria that NHTSA must consider in setting CAFE standards include the need for the United States to conserve energy. And that is a guideline we'll continue to observe, but right now it's my understanding that we're under guidance from the Appropriations Committee to make no further changes.

Mr. MCINTOSH. And so it's your anticipated policy that we would not have to change CAFE in order to meet the requirements of the Kyoto Treaty?

Mr. HORSLEY. As I understand the strategy that the President's advisors in this field have laid out is to rely on changes in technology and to invest in research and development in order to achieve the breakthroughs in technology to help us achieve the carbon reductions desired and to press ahead with the emissions trading strategy. And those coupled with the other initiatives that we have been taking for the last 5 years to improve the efficiency of the U.S. transportation system, reduce congestion, respond to the Clean Air Act requirements, all together, we hope to achieve the Kyoto targets.

Mr. MCINTOSH. And I'm always somewhat amused by that, especially the increased deficiency with one, since the Department of Energy says it will be based on luck if we're able to get those technologies in place, skeptical about whether it's wise to base policy on that.

Let me ask you this-and we have asked several times about DOT's input into the cost benefit analysis and other analyses used by the White House initiative on global climate change. And the answers back from the Department were that they've not participated in the White House's analysis. And we've asked whether you had any alternative policy options at which point the Department said they provided suggested edits on draft materials but did not develop a separate policy option. Let me ask this, specifically, with the climate change technology initiatives since one of the four sectors is transportation, in which the administration's asking for additional funding, in fact I think it's the one with the largest funding increase. Could you describe DOT's participation in the interagency development and planning for the climate change technology initiative and in the interagency analysis of alternatives that the administration may have considered before or after or during the 1997 meeting in Kyoto?

Mr. HORSLEY. Mr. Chairman, I've seen the response that was sent forward to you in March with regard to the questions that your committee asked us to respond to. I am not directly involved in many of those areas of policy. I will have to get back to you with an answer to that question in writing.

Mr. MCINTOSH. Do you want to consult with Mr. Cannie or would there be others that you'd need to talk to?

Mr. HORSLEY. I think there may be others, so I think our best shot for today's hearing would be to respond in writing.

Mr. MCINTOSH. OK, because I'm welcome to have you consult with Mr. Cannie. Formalities shouldn't get in the way of the information coming forward. But, yes; please do that and expeditiously. Also in that March 11 request, we requested certain information which we're still waiting for a complete response to, and that we've only received partial information about the funding request components on the CCTI, the climate change program. Has DOT completed its identification of the requested funding for these other climate change related components?

Mr. HORSLEY. I'm not sure what you're referring to.

Mr. MCINTOSH. Well, my understanding is the answer came back that there was some funding identified on the, for example, the new generation of transit buses, NHTSA funding for a partnership of a new generation vehicle, electric and hybrid vehicles, and sustainable transportation initiative. But there were other components of the administration's climate change proposal which amounted to the $6.3 billion that would come under DOT that you hadn't yet identified the specific budget request for. Has that work been completed? Or is it only those four, or what

Mr. HORSLEY. Again, Mr. Chairman, I am not directly involved in that analysis, and I'll have to check with our Office of Policy and others and get back to you in writing.

Let me just run by, as I stated previously. In general, what you'll see in our R&D program and our other implementation of policy is