Not all the Council's attention was devoted to the administration of the Section 106 process and improving Federal agency programs. A major achievement of the year was the completion of an awards program to recognize excellence in the national historic preservation program. Sponsored jointly with the Secretary of the Interior, the program recognized achievements of the private sector with President's Historic Preservation Awards and those involving Federal assistance or participation with National Historic Preservation Awards. We were delighted when President Reagan personally presented the President's awards at a ceremony on November 18, 1988.

The

The awards program, which was a one-time initiative, demonstrates the Council's important role in raising public awareness and support for historic preservation. Similarly, our fall Council meeting on the Navajo Reservation provided a unique opportunity to focus on preservation issues unique to Native Americans. policy recommendations, ranging from legislative changes to administrative reforms, exemplify the Council's key role as preservation policy advisor to the President and the Congress. We hope to pursue related activities in the future, as we eventually are able to reallocate resources from Section 106 case review to these important activities that will contribute to the long-term health of historic preservation in the United States.

Our FY 1990 budget contains a small increase to offset the rising costs of doing business. It seeks no new program funds or positions, but rather relies on continued management improvements and increased efficiency to meet the challenges of the future. We are optimistic that this budget will allow us to continue our activities at the FY 1989 level.

We

With more efficient Section 106 regulations, we expect to continue our leadership role in the national historic preservation program, focusing on improving the Federal government's sensitivity to preserving the national heritage. are committed to promoting the policies of the National Historic Preservation Act, which Congress enacted in 1966 to advance historic preservation in our Nation. We will continue to do our part to carry out the Act's purposes in the most efficient and cost-effective manner.

Mr. YATES. You may tell us about how your Council is doing, what your needs are.

Mr. JOHNS. Usually at this hearing we present you with our annual report which is published about this time. However, since the hearing is held earlier than it has been in the past, we don't have that report ready.

As last year, we were excited by our Presidential Historic Preservation Awards. It finally came into fruition this last year.

We got an excellent response to it. The brochure we have produced is before you now. It is the first time they have had Presidential involvement and White House involvement in awards of this kind.

We had over a hundred applications, 174 applications. We presented 10 Presidential Awards and 18 National Awards. These are award winners.

[CLERK'S NOTE.-A brochure was submitted for the Committee's files.]

Mr. JOHNS. In our annual report this year, the theme is going to be excellence in historic preservation. The internal management plan developed last year made a large impact on activities of the Council, including the workings of it all the way through.

We brought this chart along, a six-year comparison of our annual case load. When our new regulations went into effect in 1987, you can see how the case load increased.

As far as the budget is concerned, Dr. Bush is going to speak to you about the actual figures that we requested, what we had last year and what we are going to request this year.

Mr. BUSH. Thank you.

Good morning, Mr. Chairman.

Mr. YATES. Good morning.

Mr. BUSH. One of the things that we did in looking at the information you have in our budget request, and what the Council has been doing in terms of its principal responsibility, is to handle various preservation cases as they appear before us for review.

CASE LOAD

As you may recall, last year when we were before you, we had indicated to you under questioning that some of our projections. about what our case load was going to be were different from what we had thought they would be following the regulations.

We knew that they were increasing, and we knew that the rate of increase last year was approximately 10 percent. We projected that it was going to go up.

As you can see on the chart, we have now projected on out to 1990, that this trend is continuing to show a substantial increase in terms of our case load, which, of course, impacts directly on the overall work load of the Council.

In the budget, the reference is on Table 5, Mr. Chairman, on page 25. But I think this chart is probably a little bit better at illustrating exactly what the impact of this

Mr. YATES. You better have somebody hold that up, I think.

Mr. BUSH. Our revised regulations became effective October 1, 1986. We originally projected that we would see a gradual increase

in the number of cases submitted to the Council, and we anticipated those would level off and start into a decline as our programmatic agreements covering the larger scale operations would in

crease.

What has happened is that although the number of programmatic agreements that we have on our chart has increased, nearly doubled, our individual case count is continuing to go up. What we had thought would be an interrelationship between the caseload starting to decline and the programmatic going up has not happened. We have done a lot of internal examination in trying to understand why this is happening, and in a way it comes back to some of the answers we gave you last year which the statistics now seem to be confirming.

Basically the explanation is that because of the new regulations being more streamlined in the way in which agencies can comply with them, they are now doing so and preferring to take that route so that we are seeing that increase continuing.

Secondly, the education program which this Committee and the oversight Committee of Mr. Vento complimented regarding our efforts, has paid dividends in terms of the increasing work load.

The more we bring the message as to how an agency goes about complying with its responsibilities under Section 106, the more they are now willing to do it. The new regulations have made the process so much easier that it would appear from our experience that this trend is going to continue.

Based upon that assumption, I used the red line to indicate our projections as to what our 1990 case count would look like and dramatized for you what we feel is a reasonable expectation about a trend that is continuing and relating that to our budget.

PROGRAMMATIC AGREEMENTS

Mr. YATES. How do you reconcile that with the table on page 29 of the justification; you indicate the development of programmatic MOA's is going to go down in 1990?

That is third from the bottom.

Mr. BUSH. Yes. The thing with regard to the programmatic MOA's going down is what we are saying, Mr. Chairman, the development of programmatic agreements is going to level off simply because of the budgetary constraints. We have got to deal with our increasing case load first.

Let me explain that. What I mean is that under the regulations, we have an automatic time clock that is ticking when an agency approaches us to deal with our memoranda of agreement.

We do not have in the development of programmatic agreements, any such time clock. Dealing with the increasing responsibilities that we have for the increasing case load, is placing a demand on us so that the effect will be that the programmatics are actually going to reach a point where they stabilize simply for management

reasons.

Mr. YATES. Well, again, I think we should have an explanation for the statement that appears in Dr. Johns presentation on page 3, the last paragraph, where he says, "We have found that the resources invested in programmatic and training efforts reap signifi

cant dividends over the long term for both the Council and Federal program agencies."

Why do you want to reduce the amount made available?

I think also, you should address the last paragraph on page 3. You indicate that if your programmatic efforts go up it reaps significant dividends.

Your indication is that your programmatic efforts would be going down or leveling off.

Mr. BUSH. What we have presented in the budget is that we have to deal with the cases. We will then do as many programmatics as we can. But there is no time clock requiring us to deal with the programmatics.

What is happening is that case loads that we have to deal with on a day to day basis have increased so dramatically that we are having to deal with that in order to meet the time restrictions within our own regulations.

HISTORIC PRESERVATION CASES

Mr. YATES. How do you get your cases? How does a case come before the Advisory Council?

Are they filed in some way? How do you do it?

Mr. BUSH. It is done in a variety of ways. I would like to ask John Fowler to give us an overview.

Mr. FOWLER. Basically, we respond to submissions made to us by federal agencies. It follows the process specified in the regulations on considering the effects of the Federal project on historic properties.

Then the case is submitted to the Council by the agency after it has reached a certain step in the process.

Mr. YATES. Can you give us some examples?

Mr. FOWLER. They come to us normally in two ways. They either come as what we refer to as determinations of no adverse effect, where the agency has evaluated the effect of the project on the historic property and determined that the impacts don't reach a threshold of significance to require further consultations with the Council.

The agency says that it is going to carry out the project in a certain way and that as a result there would be no adverse effect. Mr. YATES. Can you give us a specific example?

Mr. FOWLER. An agency is going to spend

Mr. YATES. Which agency?

Mr. FOWLER. Community Development Block Grant Funds provided by the Department of Housing and Urban Development are going to be used to undertake the rehabilitation of historic properties within a historic district to provide rental housing. It is going to be conducted

Mr. YATES. This is a city like Boston?

Mr. FOWLER. Or Chicago, or Lowell, Massachusetts.

Mr. YATES. Where you have some factories there that have to be rehabilitated?

Mr. FOWLER. These factories will be rehabilitated in accordance to standards specified by the Secretary of Interior.

Mr. YATES. That would be considered a case?

Mr. FOWLER. That would be a case. Because the agency-the agency had a choice. It could go in and do a job—

Mr. YATES. Agency?

Mr. FOWLER. We are using a city in this situation. The city using federal funds could have gone in and totally destroyed the building as it was renovated. It could have done a very unsympathetic job

Mr. YATES. Never in Lowell?

Mr. FOWLER. Never in Lowell. The city consults with the Massachusetts State Historic Preservation Officer who says if you conduct this in accordance with the Secretary of Interior's standards using sympathetic rehabilitation treatment, it will qualify for a "no adverse effect" determination. That comes in to us, and we review that determination to make sure it meets the secretary's standards.

ADVERSE EFFECT CASES

Mr. YATES. What if you conclude it will have an adverse effect? Mr. FOWLER. Let's say they are taking the original wooden sash windows out and replacing them with single panes of glass, and this is not consistent with the historic character of the building, then we consult further with the City of Lowell and the Massachusetts State Historic Preservation Officer to see why it is necessary to change the windows, whether there is an economic and feasible way to do something that is compatible with the historic character. When we reach agreement on that, we have what we refer to as a memorandum of agreement. That is signed off on by the Executive Director on behalf of the council, the city or the federal agency, and the State Historic Preservation Office.

Mr. YATES. Suppose you can't agree?

Mr. FOWLER. There are a few new cases each year where we can't reach agreement. For example, the Idaho Department of Transportation wanted to build an interstate highway through Wallace, a historic district lodged in a valley.

There is no way that highway could be put through without having serious impacts on the historic district of Wallace, Idaho. We were unable to reach agreement on that.

The Council in that particular case went to Wallace, Idaho, held a public hearing, looked at possible alternatives that could be used to minimize the harm to historic properties and then issued comments to the Secretary of Transportation recommending certain ways for the Highway Department to minimize the harm.

The Highway Department then reached its own decision as to what it wanted to do. It can say, "Thank you very much," or it can say, "that is a pretty good idea, we will explore that and see if we can do that".

Mr. YATES. Suppose they decide it wasn't a good idea?

Mr. FOWLER. The agency completed the process. There is no further procedural responsibility or legal responsibility for the agency to consider historic properties. They have done what they are obligated to do.

Mr. YATES. Can they then proceed to building a highway?
Mr. FOWLER. Yes.

Mr. YATES. What purpose does it serve except advisory?