 I'd like to start with Mr. Gallarducci. We'd ask you to provide us with an update of OES's transition back to the governor's office, including the incorporation of public safety communications and how that's going. The status of OES and its budget given the declining federal homeland security dollars. What's happening on the federal level that we can look forward to or be concerned about or at least be able to anticipate so that we can try to address those issues. And an update on the emergency management assistance compact and resource sharing between the states because I know we're going to hear about the fires that are going on in other states in California. To which I believe we're probably responding among other things. And then your priorities and goals in the near and long term. And so, pleasure to have you. It's a great pleasure to see you here and if you'd go ahead and proceed. Great, well thank you so much, Chairwoman Jackson and Vice Chair Lowenthal, members of the committee. It is really my pleasure to be with you today and particularly a great pleasure to be sitting here with my great interagency partners. General Baldwin from the Guard and Chief Pemla from Cal Fire. We work so closely together in addition with Commissioner Farrow as CHP to make sure that the public safety programs of California. Occur and that we keep everybody as safe and prepared as possible. So I really appreciate the opportunity to be here today. Our principal objective really is to reduce the vulnerabilities to hazards and to crimes here in California through a series of programs that ensure for a resiliency within California which include things like emergency management and homeland security programs and grants and criminal justice programs. This last year we actually have had quite a few exciting changes. As of July 1st, you had mentioned, Chair, that we have moved from agency back into the governor's office. And I have to say that as far as that transition has gone so very smoothly, our authorities and the regulatory part of us, our responsibilities have not changed. In fact, as a part of GRP2, we assumed the responsibility of managing and integrating the Public Safety Communications Office which was previously with the California Technology Agency and now is in with us. So it actually increased our roles to around 900 or so full time employees at Cal OES. And Karen Wong who's sitting to my right here is the director of our Public Safety Communications. She came over, thank God, with the whole team because she's very, very good at what she does. And she's going to brief you a little bit in a minute on more specifically how that's come together. So this last year we also did some significant things. We actually, when I came in, really needed to evaluate the department. A lot of good work had been done, but as you may remember, we had two organizations, the Office of Homeland Security and the Office of Emergency Service that were merged together. And to create the emergency management agency. And a lot of work really had been done to make that happen, but there were still gaps that needed to take place. And part of my role after talking with the governor was to sort of be the last mile, I guess you could say, with regards to getting that in place. So what I did is to fully integrate both entities and make us as robust as possible. I did several things. First, I implemented a reorganization within the department that merged the two entities completely together. To have a much more integrated and effective response and recovery capability. And also built it around the incident command system so that now instead of us rolling in from a day to day operation into an incident command structure to manage an emergency. We as a department, a little bit different in the way normal state government departments are set up. We as a department are now fully set up under the incident command system so that we are in it every day. We are operating that way and when we transition into an emergency it is seamless and people understand their roles and responsibilities better. With that, we tied in an extensive update of our strategic plan and objectives. Built in a performance measurement system, which will be measuring performance at every level based upon our strategic goals and objectives tied to federal guidelines, federal granting, particularly in the context of the reduction in federal funds. We know through Homeland Security reductions in grant funds that as time goes on, we need to be thinking smarter and more effectively and efficiently to be able to account for the loss in these federal dollars. And so far the transition into this new organization has gone smoothly. All the months of planning and the work with the CTA and with Karen Shoppe have allowed for the integration of PSC to go very smoothly and so far so good. I would say that things are operating fairly well. That doesn't mean that all the eyes are dotted and a teaser crossed. We still have continual work to do and we need to be prepared for that emergency that is inevitable, that disaster that is inevitable. So we have worked very extensively to build in and complete catastrophic disaster plans for the Los Angeles Basin, the San Francisco Bay Area. And now just recently the Cascadia Subduction Zone, which is basically Mendocino County North. And we just started, we just launched a catastrophic disaster playing initiative for the Central Valley for a catastrophic flood. So we are really laying a very, very firm foundation in place that is all hazard and all risk and being able to really address. What is that super storm sandy scenario going to look like to California? As you know, the last biggest disaster we've had that really stretched us with a lot of infrastructure damage was the Northridge earthquake. And we really haven't had something to that size and that by comparison to other big earthquakes wasn't that big. So we need to really think about the big one that's going to happen and that really is the greatest risk to California, not just to the people, to the economy, infrastructure, etc. So a little bit about our funding. We provide funding to our communities to address their unique challenges through the use of federal Homeland Security funds through grant funding sources, which includes both emergency management performance grants and Homeland Security grants. However, these resources are not as robust as they once were. For example, in 2010, California received $268 million in Homeland Security grant funding. But in fiscal year 2013, California received only $168 million in Homeland Security grant funding, roughly $100 million less in just two fiscal years. So while the 2013 numbers are slightly higher than what we received in 12, it's still well below what we received just a few years ago. And this results in us having to really have an efficient operation, re-prioritize, make sure that every dollar that's coming in is effectively used. And that also means that we need to have a greater connection with our local partners that are using those dollars, so that they can make whatever programs they have more resilient. Not just one-offs, not just a widget buy, but how do we make those programs long-term and more resilient? And of course, despite the significant funding reductions, what I would say in the Homeland Security side, for fiscal year 2013, the emergency management performance grants, which come directly from FEMA, are relatively stable. We received about $26 million in that California share. We passed roughly 55%, so it's like $56 million. And then we pass about 55% to local government, and then the other remaining amount stays with us. And these funds support programs such as the performance programs, assistance to tribal and other state agencies and local governments for emergency preparedness and protection of life and property for all hazards, including tsunami and earthquake hazard reduction programs. So, and of course, with Proposition 30 passing and the governor being able to stabilize the budget as he has, we have been able to have an opportunity where we haven't had an enhancement of our funds. But we've been able to stabilize our budget after all the budget cuts to be able to now have a better sense of long-term strategic planning and what I can count on and how we can then move forward. With the addition of PSC, it's been an interesting dynamic. They have a little different budget model, so we're working to integrate their budget model into Cal OES to make a more streamlined system. That said, we're learning that down the road there are things like infrastructure enhancements that need to take place. We have a very aging telecommunications microwave system. Some of them are over 50 years old in our towers and in our communication systems. If you go to what we call the Network Operations Center or the NOC, which is really the heart of the entire state system, they're still working on telephone wiring that we would have seen back in the 1950s. This is not a good thing and we need to really think about our resiliency because if that goes down, the state goes down. And that's not a position that we want to be in. So we're learning about that and we're kind of gathering it up and looking at what our next generation's going to be. And I know that in the next generation 911, Karen's going to talk about that as well. But there's a lot of great exciting things and really now with PSC and OES coming together, it really builds that complete picture of full public safety from emergency management and fire and law enforcement, homeland security and communications all linking together. What else does that give a better picture for you on really what the needs are and how we need to be able to approach it? In the area of security, I want to mention that really kind of one of the biggest threats we're facing today, that were challenges, I should say, that we're facing today. And this is not just in California, but it's a national, international challenge. It's that of a challenge of cyber crime and cyber security. It is one of my top priorities as we move forward in addressing this in the coming years in Homeland Security. And what I've done recently is I partner with Director Ramos over at the California Department of Technology. And we've established a California Cyber Security Task Force. And this task force is really an unprecedented alliance made up of state and local, private sector, industry, universities, other senior officials and experts in the field of cyber security. To be able to come together to identify California's gaps, what our needs are, and how do we need to move the state forward to make the protections, identify the low hanging fruit, then the more complicated things. But because Silicon Valley sits within California, they are the engine that can help us get what we need to get done. So I'm leveraging every aspect of that to be able to get them engaged in our cyber security task force. Eventually, what I see is guidelines coming out, maybe through executive order, that will allow both private and public institutions, universities, et cetera, local governments to have a set of guidelines on operating their computer systems that will then harden them against any future attacks. We are, for lack of a better term, a sieve of information going out. Not just the state of California, but in general. And we are getting pinged and hacked, cyber-crimed each and every day. So this is a great concern and we want to be on top of it and we're moving forward. So the goal of the task force is to position California in a way that we are more resilient and protective for all of our state. I mentioned the performance measurements. One of the areas where we've also enhanced is we've taken, as you may have remember when I came on, there was a budget change that would basically eliminate the California Specialized Training Institute. I had pulled that back because I saw that really you cannot respond and understand the emergency programs without having a robust training program. And in the absence of having big disasters overall, you have to have good training and exercises to be able to get the job done. So I wanted to resurrect CSTI, but I wanted to build it in a new way. So we're building an enterprise. It's not a specific location, but it's a statewide enterprise. We're seeking federal support through the National Training Consortium for Center of Excellence. We have partnerships that we're reaching out to with Cal State, with UC, with the private sector, with various other state agencies. So that we've got this sort of joint powers authority, joint powers agreement coming forward to move training forward in a very robust way. All of that will be tied to performance measures, not just at the state level, but in our local partners as well. So that we know that all the local emergency managers, and everybody's dealing with emergency management at the local level, all the way up to the top, to the federal level, all are meeting a performance measure. And then I can tie the performance grants to those performance measures. So that's kind of ongoing as we move forward. And then lastly, let me just say that our mutual aid system in California still is bar none, the best, most robust mutual aid system in the world. That said, we have actually had an impact due to the budgets on local governments who support the backbone of that mutual aid system. We roughly have about 25% less capability in our ability to get resources to respond immediately to these big fires and other kinds of disasters. Now, you may think that, okay, 25%, it's resilient, we can handle that. We can relatively handle that, but understand that with every percentage drop of capability and participation in that system, it makes it for a slower response, which then allows fires to get bigger. It allows problems to get more complex. So we really want to keep that system robust and supporting those responders, those first responders, the people that participate in the mutual aid system to ensure that we have that capability. As we sit here today, we have deployed mutual aid assets, both from local government, state agencies, the California Guard in support of Cal Fire and US Forest Service Operations for fires throughout California. And then the emergency management assistance compacts, Chairwoman mentioned. This is a national emergency management compact agreement system. All the states and the United States are signatory to it. Basically, the concept is state helping state. And it's designed so that the state that's requesting goes through a process and makes a request for a kind of resource and then reimburses the state that's providing. And it's been very successful. We have been a receiving state in the past. But more than often, we are a deployment state. And in fact, as we sit here, we have resources in Alaska supporting the state of Alaska with their flooding that they have going on up there. So with that, I mean, just say I'd be happy to answer any questions. I really appreciate the opportunity to sit in front of you. I know you may have many more questions for me and I'm open to answering any. And look forward to working with all of you in the coming year. I have some great ideas of how the legislature can support our efforts, particularly on some new programs that are coming up right around the corner. And I look forward to talking to you about those soon. Thank you very much. Thank you very much, very helpful.