[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]



 
                  AGRICULTURE, RURAL DEVELOPMENT, FOOD
                  AND DRUG ADMINISTRATION, AND RELATED
                    AGENCIES APPROPRIATIONS FOR 2000

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS
                              FIRST SESSION
                                ________
     SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG 
                  ADMINISTRATION, AND RELATED AGENCIES
                     JOE SKEEN, New Mexico, Chairman
 JAMES T. WALSH, New York
 JAY DICKEY, Arkansas
 JACK KINGSTON, Georgia
 GEORGE R. NETHERCUTT, Jr., 
Washington
 HENRY BONILLA, Texas
 TOM LATHAM, Iowa
 JO ANN EMERSON, Missouri           MARCY KAPTUR, Ohio
                                    ROSA L. DeLAURO, Connecticut
                                    MAURICE D. HINCHEY, New York
                                    SAM FARR, California
                                    ALLEN BOYD, Florida

 NOTE: Under Committee Rules, Mr. Young, as Chairman of the Full 
Committee, and Mr. Obey, as Ranking Minority Member of the Full 
Committee, are authorized to sit as Members of all Subcommittees.
  Henry E. Moore, John J. Ziolkowski, Martin P. Delgado, and Joanne L. 
                       Orndorff, Staff Assistants
                                ________
                                 PART 3

                        CONSERVATION PROGRAMS AND
                    MARKETING AND REGULATORY PROGRAMS
                                                                   Page
 Natural Resources Conservation Service...........................    1
 Marketing and Regulatory Programs................................  359
   Animal and Plant Health Inspection Service

   Agricultural Marketing Service

   Grain Inspection, Packers and Stockyards

   Administration

                              

                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 56-251 O                   WASHINGTON : 1999



                           COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

 RALPH REGULA, Ohio
 JERRY LEWIS, California
 JOHN EDWARD PORTER, Illinois
 HAROLD ROGERS, Kentucky
 JOE SKEEN, New Mexico
 FRANK R. WOLF, Virginia
 TOM DeLAY, Texas
 JIM KOLBE, Arizona
 RON PACKARD, California
 SONNY CALLAHAN, Alabama
 JAMES T. WALSH, New York
 CHARLES H. TAYLOR, North Carolina
 DAVID L. HOBSON, Ohio
 ERNEST J. ISTOOK, Jr., Oklahoma
 HENRY BONILLA, Texas
 JOE KNOLLENBERG, Michigan
 DAN MILLER, Florida
 JAY DICKEY, Arkansas
 JACK KINGSTON, Georgia
 RODNEY P. FRELINGHUYSEN, New Jersey
 ROGER F. WICKER, Mississippi
 MICHAEL P. FORBES, New York
 GEORGE R. NETHERCUTT, Jr., 
Washington
 RANDY ``DUKE'' CUNNINGHAM, 
California
 TODD TIAHRT, Kansas
 ZACH WAMP, Tennessee
 TOM LATHAM, Iowa
 ANNE M. NORTHUP, Kentucky
 ROBERT B. ADERHOLT, Alabama
 JO ANN EMERSON, Missouri
 JOHN E. SUNUNU, New Hampshire
 KAY GRANGER, Texas
 JOHN E. PETERSON, Pennsylvania     DAVID R. OBEY, Wisconsin
                                    JOHN P. MURTHA, Pennsylvania
                                    NORMAN D. DICKS, Washington
                                    MARTIN OLAV SABO, Minnesota
                                    JULIAN C. DIXON, California
                                    STENY H. HOYER, Maryland
                                    ALAN B. MOLLOHAN, West Virginia
                                    MARCY KAPTUR, Ohio
                                    NANCY PELOSI, California
                                    PETER J. VISCLOSKY, Indiana
                                    NITA M. LOWEY, New York
                                    JOSE E. SERRANO, New York
                                    ROSA L. DeLAURO, Connecticut
                                    JAMES P. MORAN, Virginia
                                    JOHN W. OLVER, Massachusetts
                                    ED PASTOR, Arizona
                                    CARRIE P. MEEK, Florida
                                    DAVID E. PRICE, North Carolina
                                    CHET EDWARDS, Texas
                                    ROBERT E. ``BUD'' CRAMER, Jr., 
                                    Alabama
                                    JAMES E. CLYBURN, South Carolina
                                    MAURICE D. HINCHEY, New York
                                    LUCILLE ROYBAL-ALLARD, California
                                    SAM FARR, California
                                    JESSE L. JACKSON, Jr., Illinois
                                    CAROLYN C. KILPATRICK, Michigan
                                    ALLEN BOYD, Florida

                 James W. Dyer, Clerk and Staff Director

                                  (ii)


   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
                RELATED AGENCIES APPROPRIATIONS FOR 2000

                              ----------                              

                                      Wednesday, February 24, 1999.

                 NATURAL RESOURCES AND THE ENVIRONMENT

                               WITNESSES

JAMES R. LYONS, UNDER SECRETARY, NATURAL RESOURCES AND ENVIRONMENT
PEARLIE S. REED, CHIEF, NATURAL RESOURCES CONSERVATION SERVICE
DANNY R. SELLS, ASSOCIATE CHIEF, NATURAL RESOURCES CONSERVATION SERVICE
ANNE M. DUBEY, DIRECTOR, BUDGET PLANNING AND ANALYSIS DIVISION, NATURAL 
    RESOURCES CONSERVATION SERVICE
DENNIS KAPLAN, OFFICE OF BUDGET AND POLICY ANALYSIS, DEPARTMENT OF 
    AGRICULTURE
    Mr. Skeen. Good afternoon. Today we have with us the 
Natural Resources Conservation Service, as led by Chief Pearlie 
Reed and Mr. Jim Lyons, the Under Secretary for Natural 
Resources and the Environment.
    This subcommittee appreciates the work that NRCS 
accomplishes in preserving and maintaining the health of our 
Nation's soil, and you are under a lot of pressure by a budget 
request that seeks significant funding increases and adds new 
programs, while at the same time proposes significant staffing 
decreases.
    We have read your prepared statement. So we would ask that 
you include possibly the highlights. Your written statements 
will be appreciated and will be printed in full for the record. 
I would like for you now to go ahead and introduce your panel.

                Opening Remarks by Undersecretary Lyons

    Mr. Lyons. Thank you very much, Mr. Chairman. It is a 
pleasure to be here today.
    Mr. Skeen. It is a pleasure having you. Sorry we were 
holding you up.
    Mr. Lyons. Not a problem at all.
    I want to thank you for this opportunity to be here, and I 
want to apologize in advance for a cold that is beating me in 
this battle, but we will do the best we can today.
    We have with us today, of course, Pearlie Reed, Chief of 
NRCS; Danny Sells, Associate Chief, Anne Dubey, who heads up 
our budget shop, and Dennis Kaplan from the Office of Budget 
and Program Analysis in USDA. It is a pleasure for all of us to 
be here today.
    One other thing I want to do, Mr. Chairman, before I get 
started, I wanted to send regards from an old colleague and 
mutual friend, Jack Ward Thomas, who I saw last week. He wanted 
me to say ``hello'' to you as a fellow Aggie.
    Let me start, Mr. Chairman, by saying that, first off, I 
have been up here now six years making these presentations to--
--
    Mr. Skeen. Has it been that long?
    Mr. Lyons. It has been that long, Mr. Chairman.
    But I dare say that a great deal has changed in that period 
of time. I think one of the things I am most proud of during my 
tenure in office, having worked first with Paul Johnson and now 
with Pearlie Reed, is the outstanding work that NRCS has done 
to advance the conservation mission of USDA; and, also, I 
think, to distinguish itself as the central Federal agency for 
conservation on America's private lands. The private land 
conservation challenge is a tremendous one, and I think NRCS, 
in partnership with conservation districts, does an outstanding 
job in promoting good land stewardship across the American 
landscape. I am very proud of the work they do.
    Farmers, ranchers, and communities across the Nation can 
turn to NRCS and receive assistance on a wide spectrum of 
conservation efforts, encompassing things like nutrient and 
pesticide management, wetlands conservation, watershed 
planning, flood prevention, water quality improvement, 
developing and maintaining wildlife habitat, and, of course, 
soil conservation, the ``bread and butter'' of the agency.
    To meet that demand, NRCS delivers a wide variety of 
financial and technical resources to its customers. But I want 
to emphasize, Mr. Chairman, of course, the core of NRCS has 
been, and continues to be, its people, who are outstanding and 
doing a tremendous job in working in partnership with 
landowners across the Nation. It is the NRCS delivery system in 
the field that makes all this work happen, and I can you tell 
you, from many meetings with colleagues in other departments 
and agencies, that it is the envy of those Federal agencies. It 
is the field conservationists who have earned the trust of 
farmers and ranchers across the Nation through the sound advice 
and technical assistance they provide.
    What I would like to do is just take a moment and provide a 
little more detail on how the NRCS field delivery system 
provides conservation technical assistance to meet the agency's 
mission. As I noted, more than 70 percent of the land in the 
contiguous United States is privately owned, including 
virtually all of the Nation's farm and rangelands. NRCS is the 
only Federal agency whose major purpose is to provide 
conservation technical assistance to private landowners across 
the country. The agency's focus is on helping landowners and 
users achieve natural resource and environmental goals while 
maintaining productive and profitable operations--operations 
that, of course, are vital to rural communities across the 
Nation, as you know very well from New Mexico.
    Conservation Operations is the foundation for most of the 
agency's activities. Conservation Operations represents a 
longstanding and historical partnership of interests, all 
working together in a concerted way toward a sustainable, 
productive Nation. Within that Conservation Operations budget, 
there are certainly activities and functions that I want to 
highlight.
    Conservation technical assistance, of course, is the 
cornerstone for most agency activities, and our Fiscal Year 
2000 budget request is $585 million, a small increase of only 
$37 million for technical assistance. Conservationists on the 
ground are under increasing demand for their services, as they 
tackle new responsibilities while retaining the commitment to 
the community for providing basic assistance to landowners.
    Throughout the Nation, NRCS conservationists facilitateand 
enable local action. Technical assistance funding ensures the presence 
of these individuals and promotes voluntary conservation activities.
    With respect to workload, one area of particular concern is 
the issue of water quality problems associated with animal 
feeding operations. I believe you are aware, Mr. Chairman, that 
in September 1998, as called for in the administration's Clean 
Water Action Plan, USDA, working with the Environmental 
Protection Agency, jointly released for public comment a draft 
Animal Feeding Operation--AFO--strategy that establishes 
national performance expectations for all animal feeding 
operation owners and operators. The strategy presents a series 
of actions that USDA and EPA will take to minimize water 
quality and public health impacts of the nearly 450,000 AFO's 
in the United States.
    The Fiscal Year 2000 budget proposes to increase 
conservation technical assistance available to AFO operators by 
$20 million, and we all recognize that is not going to quite do 
the job, but it is an investment we begin to make as we try to 
refine and complete the AFO strategy--a strategy, I would 
emphasize, which is focused really on voluntary approaches to 
dealing with water quality problems, as opposed to the stick 
approach that EPA has used so often. I think we have made a 
great deal of progress in demonstrating that a voluntary 
approach is the way to get the job done, and we want to be able 
to demonstrate that as we move forward.
    Additional support for the Clean Water Action Plan in the 
budget includes $20 million for competitive partnership grants 
that will be used to strengthen the leadership of locally-based 
organizations, such as conservation districts and watershed 
councils, to enable them to provide coordination of locally-
initiated conservation efforts. Finally, a further increase of 
$3 million would be used by NRCS for additional monitoring to 
help target resources and document baseline conditions and 
performance.
    Another issue of concern is the issue of global climate 
change. We want to learn more about global climate change, and 
the conservation technical assistance increase includes $12 
million for soil studies and inventories to provide baseline 
soil data to assess the impacts of Federal programs on soil 
carbon stocks. There is also $3 million proposed to fund 
demonstration and pilot projects to test various carbon 
sequestration methods.
    The increases are partially offset, though, by a decrease 
of $31 million for a transfer of base funding to the proposed 
Support Services Bureau, which will essentially fund the 
administrative support services common to county-based 
agencies. As you are aware, Mr. Chairman, from meetings that we 
all had with the Secretary, we are doing our best to come up 
with the most cost-efficient and effective approach to 
providing administrative services for our field-based agencies, 
and that involves NRCS, FSA, and the Rural Development 
Agencies. Earlier this month, Secretary Glickman gave us 
direction to move forward with implementation of this strategy, 
and this is an investment in that central support service.
    Some other activities encompassed by conservation technical 
assistance include continuing work on highly-erodible land 
conservation. Although the 1985 Farm Bill provided basic 
direction for conservation compliance, it is important to 
remember that that work continues. Our experience has shown 
that approximately 20 percent of producers will change their 
conservation systems each year, requiring NRCS technical 
assistance.
    In the area of wetland determinations and certifications, 
NRCS is involved in determining areas subject to Swampbuster 
and response to requests from farmers who plan activities that 
may adversely impact wetland. NRCS certifies wetland 
determinations only upon request, when clients propose to alter 
the hydrology within a wetland. In Fiscal Years 1997 and 1998, 
landowners requested about 40,000 such certifications, and we 
expect that number to increase annually.
    I also want to mention the Grazing Lands Conservation 
Initiative briefly. You and I have talked about this many 
times. It is a very successful program that is really 
grassroots-driven, and has helped NRCS better define the 
resource needs and benefits generated when grazing lands are 
improved. In Fiscal Year 1999, NRCS was able to continue to 
support grazing lands conservation coordinators in each State, 
and we think it is critical to continue that investment.
    I will briefly mention, also, in a timely way, since Ms. 
Kaptur is with us, the work we are doing in the urban 
conservation arena, another area that we have focused on as 
work has increased in the urban and suburban areas. Natural 
resources don't recognize urban and suburban boundaries, as you 
know, Mr. Chairman, and to ignore their interaction within a 
watershed wouldn't do either justice. The watershed approach to 
resource conservation has been widely acclaimed and highly 
successful, and I am proud to say that we have taken the lead 
in working across the landscape in rural, suburban, and urban 
areas to begin to examine ways in which we can rehabilitate the 
health of watersheds and address all those factors that 
contribute to the decline of water resources.
    We continue our work in areas such as soil surveys and 
plant material centers. And I would make one note, Mr. 
Chairman, since the Forest Service is the other agency I deal 
with. We expect a pretty severe fire season this year, and the 
plant material centers have been instrumental in providing 
information and guidance and seedstock to help regenerate areas 
that are severely impacted by fire. I hesitate to say this, but 
we expect the fire season to start in the Southwest any day 
now.
    Other appropriated discretionary accounts in our budget are 
the Watershed Surveys and Planning, Watershed and Flood 
Prevention Operations, and a new program, Debt for Nature, for 
which we are going to seek authorization this year. The budget 
includes $5 million to implement this program. Really what this 
program is intended to do is provide technical and financial 
assistance to USDA borrowers with cashflow problems who also 
have lands that require conservation treatment. In exchange for 
debt forgiveness on their lands, program participants, on a 
voluntary basis, could agree to enroll environmentally-
sensitive lands into the conservation easements. This was a 
recommendation that came directly out of USDA's Civil Rights 
Action Team report regarding establishment of a Small Farm 
Commission, which was chaired by a former colleague of yours, 
Harold Volkmer. He did an excellent job.
    We continue our support to the RC&D's, the Resource, 
Conservation, and Development organizations, which, of course, 
have done a tremendous job as well.
    NRCS also administers, on behalf of the Commodity Credit 
Corporation, several cost-share programs, including those set 
forth in the 1996 farm bill. We also provide 
technicalassistance to individuals and groups participating in the CRP 
program, which, of course, is administered by the Farm Service Agency.
    The Environmental Quality Incentives Program, or EQIP, 
provides a single voluntary program of flexible technical, 
financial, and educational assistance to farmers and ranchers 
who face serious threats to soil, water, and related natural 
resources on their agricultural lands. Assistance is provided 
in a manner that maximizes environmental benefits per dollar 
expended while assisting producers with issues such as local 
environmental laws or community-identified environmental needs.
    In Fiscal Year 1999, we received $174 million in the EQIP 
program, just under the $200 million that was authorized. We 
had requested $300 million, and, again, have included in our 
budget a request to increase the authorization to provide $300 
million for this extremely valuable program. The program has 
been extremely successful. We received nearly 55 thousand 
applications in Fiscal Year 1998 for the program, and we expect 
the demand to grow considerably for use of this program.
    I should also mention the Wildlife Habitat Incentive 
Program, authored by your colleague, Senator Cochran, provides 
for implementing wildlife habitat practices to develop upland 
wildlife habitat, wetland wildlife habitat and work dealing 
with threatened and endangered species. This program, too, has 
been extremely successful, and we are going to seek additional 
funds for the program in Fiscal Year 2000.
    Finally, I want to mention the Farmland Protection Program. 
On Sunday, Secretary Glickman and I had a chance to visit with 
the Natural Resources Committee of the National Governors 
Association to address issues associated with livability and 
protection of open space. To be quite candid, Mr. Chairman, I 
was amazed at the bipartisan interest and support in securing 
funds to provide for the protection of open space and to reduce 
the impacts of urban encroachment on prime agricultural land. 
Speaking for the governors, Governor Christine Todd Whitman 
from New Jersey, in whose State taxpayers recently passed a 
billion dollar initiative to provide $100 million a year to 
provide for farmland and forestland protection, governors from 
Oregon, Washington, Wyoming, and other States, all spoke to the 
important need to invest in farmland protection at the 
Governor's conference.
    The Fiscal Year 2000 budget that we have submitted includes 
a total of $77.5 million for farmland protection in two 
components: $50 million in the new discretionary fund that 
would come out of the Land and Water Conservation Fund, part of 
what we are calling our Lands Legacy Initiative, and $27.5 
million in CCC funding under proposed legislation that we will 
submit to the committee.
    We also administer, of course, the WRP program, the Wetland 
Reserve Program, which has been extremely successful. In Fiscal 
Year 2000, we are going to propose to enroll almost 200,000 
acres and essentially reach the 975,000-acre cap that was 
called for in the program. Technical assistance funding needed 
for the larger enrollment effort would be about $18 million 
this Fiscal Year.
    Let me close, Mr. Chairman, by pointing out something that 
I know you recognize, but I want to highlight as well. Through 
the 1985, 1990, and 1996 Farm Bills, working in partnership 
with the Congress, I think we have developed a tremendous 
toolkit for conservation--tools or programs that can be 
extremely useful in achieving individual landowner or community 
or national conservation goals. They run the gamut from land 
retirement programs, like CRP and WRP, to the technical 
assistance we provide through conservation technical assistance 
or the work of RC&D's, to cost-share programs, like those we 
administer through EQIP and WHIP.
    We have the tools we need to get the job done, Mr. 
Chairman, but I think the key to conservation is partnership, 
and the key to partnership is having people on the ground to be 
able to work with landowners and communities and other agencies 
and entities to get the job done.
    I started out by saying the key to success of NRCS has been 
its people. I think it is critical that we have the people to 
do the job and using these tools to apply conservation on the 
landscape. I want to share with you my concern that we have a 
tendency to invest in programs as a Nation, but are less 
willing or less anxious to invest in people, who are really the 
key to delivering and implementing those programs. There are 
some gaps in our budget, that I am sure the Chief can help you 
understand, that may limit our ability to put people on the 
ground, to put in place those conservation tools.
    I think it is critical that we make that investment. Mr. 
Chairman, as you know from your history and your professional 
experience, that knowledge and expertise is critical to helping 
landowners understand how to achieve their long-term 
conservation goals. We need to have the people out there to get 
that job done, as well as the program dollars to put those 
conservation practices in place.
    So we look forward to working with you as always in trying 
to put together a budget that achieves those long-term 
conservation goals, but I would implore you that this year we 
take a hard look at what it is going to take to invest in the 
people who are going to apply those tools and work in 
partnership with landowners and conservation districts and 
others across the Nation to ensure that we have put in place 
the kind of conservation legacy of which we are all proud.
    Thank you.
    Mr. Skeen. Thank you.
    Mr. Reed.

                      Opening Remarks by Mr. Reed

    Mr. Reed. Thank you, Mr. Chairman. As you indicated 
earlier, you have my statement, but I do have a few comments I 
would like to make.
    Mr. Skeen. Well, we will just take them right on 
straightaway from you.
    Mr. Reed. Thank you.
    Mr. Skeen. We appreciate it.
    Mr. Reed. Mr. Chairman, members of the committee, thank you 
for the opportunity to appear before you today. I am pleased to 
be here representing the men and women of the NRCS and our 
conservation partners. Our people in the field, working with 
farmers and ranchers, are the NRCS. Our employees, including 
conservation district employees, are some of the most capable 
and dedicated employees you will find anywhere.
    Mr. Chairman, I do have one major concern, and that concern 
is we, the NRCS, are being asked to do too much. In addition to 
the basic soil and water conservation work on cropland, 
rangeland, pastureland, the policymakers in this country are 
putting more on our plate; namely, the massive livestock waste 
issue, global climate change, and a host of emerging water 
quality problems. Simply put, we are being overcommitted.
    The reason so much is being asked of the NRCS is because so 
much is being asked of our farmers and ranchers here in 
America, and we, the NRCS, have a reputation of getting the job 
done. But I would like to assure you that we will, whatever we 
are asked to do, we will, in the most efficient and effective 
way possible, do all that we can do.
    Again, thank you for the opportunity to be here with you 
today.
    [The prepared statements and biographies of James R. Lyons 
and Pearlie S. Reed and biography of Danny D. Sells follow:]


[Pages 8-40 -- The official Committee Record contains additional 
    material here]


    Mr. Skeen. Thank you. I think what I will do is start with 
this questioning, and then I will go to Ms. Kaptur for her 
introductory statement. Go ahead and make that, Marcy. Go 
ahead.
    Ms. Kaptur. Thank you. Thank you, Mr. Chairman. I just 
wanted to welcome our witnesses today, and thank Mr. Lyons and 
Mr. Reed, and all of your associates from NRCS, for the fine 
work that you and your colleagues do, not just here in 
Washington, but all over the country. I will agree with Mr. 
Reed on that.
    I have some questions, and I apologize for being about 
eight minutes late. I was involved in a meeting on, of all 
things, poultry waste management, with some of our fellow 
colleagues, and the problems we are having in the State of 
Maryland. So I apologize. I think NRCS may be the solution, at 
least part of the solution, to that.
    So I do have some questions, Mr. Chairman. I will withhold 
those for the moment.

                            staff reductions

    Mr. Skeen. Thank you, Ms. Kaptur.
    Let me start with, Under Secretary Lyons, the President's 
budget proposes a significant funding increase for NRCS; yet, 
the staffing level has declined by a thousand people. How will 
this staffing reduction affect the current conservation 
programs? And, also, what types of personnel actions have to be 
considered to reduce the staff by a thousand people? Your 
program does not require them or----
    Mr. Lyons. Well, let me take a shot at that, Mr. Chairman, 
and then I will yield to the Chief, who can, I think, offer 
more detail.
    Mr. Skeen. Well, I want to know what he is going to do with 
those thousand people he is losing?
    Mr. Lyons. Well, I am concerned about the loss of those 
people. In large measure, that loss would be associated with 
the lack of reimbursements for programs we implement through 
the CCC. Part of the problem lies with a cap on the amount of 
reimbursement that can be provided from funds in the Commodity 
Credit Corporation, and that impacts our ability to do 
everything from provide technical assistance for the CRP 
program to other programs as well. I honestly believe we need 
to address that and work together to find a way in which to do 
so. It is an issue that we have to address, Mr. Chairman. If we 
don't, we face loss of FTE's, and FTE's translate to 
conservationists on the ground doing the job that we want them 
to do.

                        conservation philosophy

    Mr. Skeen. Mr. Reed, OMB has laid out some pretty ambitious 
goals for your agency, but you are the Chief, and we recognize 
you as such. So we would like to hear from you on two matters. 
We want your comments on how well you believe the Federal 
Government is doing in meeting the mission on private lands 
conservation and your philosophy on conservation in general.
    Mr. Reed. With your permission, I would like to do the 
latter first.
    Mr. Skeen. You can take it any way you want to. We 
appreciate it.
    Mr. Reed. My philosophy as it relates to conservation is 
that soil and water conservation are as important to our 
country, in my opinion, as education, healthcare, and national 
defense. I think that every acre of land in this country and 
every bucket of water must be used wisely. I think it is good 
public policy in this country for us to ensure that we maintain 
our conservation infrastructure that we have out in the 
countryside with State conservation agencies and conservation 
districts, so that we have this basic safety net that is needed 
to provide the appropriate science and technology in the form 
of technical assistance to our Nation's farmers and ranchers 
and other land users.
    As it relates to how well we are doing, I think we are 
doing exceptionally well, but we could do better. The men and 
women that we have out in the countryside I alluded to earlier 
are the most dedicated and capable people you will find any 
place. There is one thing, though, that really bothers me, and 
that is, our people, most of them out in the countryside, work 
uncompensated 10, 12, 16 hours a day, Saturdays, Sundays, 
holidays. When I tell some folks this,they tell me that you 
need to tell them to go home, and if they don't go home, you need to 
take the appropriate action. And my reply to that, is that you take 
action against folks who don't want to work, not against those that do.
    So, again, getting back to my agency and our people being 
asked to do a lot, we don't mind it at all, but we want some 
help to get the job done.
    Mr. Skeen. Well, I understand. That is why I am very 
surprised that we are offering a thousand reduction in 
personnel. I come from the old school, too, that I think it is 
those people on the ground out there that are doing the Lord's 
work as far as the philosophy of what we can do to maintain our 
status as a world producer of food--because we take care of our 
soil and we take care of our water, and conservation is 
absolutely essential. So I am a little concerned about the loss 
of that thousand people, but I understand why you are doing it.
    I will second your philosophy on conservation. It is the 
folks on the ground out there who take it as their life's work 
to make sure that we conserve our resources, particularly our 
water and land resources. That is the best base we have.
    Thank you very much.
    Ms. Kaptur.

                          loss of arable lands

    Ms. Kaptur. Yes, Mr. Chairman, I wanted to ask either Mr. 
Lyons or Mr. Reed, should the American people be concerned with 
the diminishment of arable lands in this country?
    Mr. Lyons. I think to some degree we should be, Ms. Kaptur. 
I think a number of factors come into play, and one is the loss 
of prime farmlands because of growth. The other is because of 
poor management, because of the inability to invest in proper 
stewardship, the loss of our lands in portions of the Southwest 
and other parts of the country, where additional investments I 
think would pay off.
    A large concern raised by the American Farmland Trust and 
others is the fact that prime farmland in and near urban areas 
is disappearing at an alarming rate, which is going to result 
in increased costs associated with production, and I think 
could ultimately have a big impact on our capacity to meet the 
Nation's needs, as well as protect the quality of life that we 
have all come to associate with areas such as your district and 
Mr. Skeen's and others. We need to tackle that issue.
    Ms. Kaptur. How would you answer this: People might say, 
well, you know, we are really moving into an area; we will lose 
a third of those who produce pork in this country perhaps over 
the next year, if Congress doesn't act; we have lost much of 
our sheep production, lamb production, in this country; we have 
cattle people in trouble; our grain prices are at historic 
lows, but really we are moving into an age where we are going 
to industrialize agriculture, so all Ohio eggs will come out of 
one major producer now with over a million laying hens. We will 
just have a few companies producing chickens, poultry, for 
market, and we will aggregate into only a few feedlots the 
majority of meat that will be raised for consumption in this 
country, and we will basically shut down rural life as we known 
it. So why should we bother?
    We won't see fish in the sea anymore. We will really have 
these fish farms that we build all over the country. We are now 
into an era of industrializing agriculture. So why should we 
care about arable lands? Why should we care about the 
fundamental resource base that provided the wealth that built 
this country in its first two centuries? How would you explain 
to the American people that arable lands are important, if they 
are?
    Mr. Reed. Mr. Secretary, let me take a shot at that. I am a 
student of history. If you take a look at what has happened to 
those civilizations that did not take care of the land, those 
civilizations no longer exist. What is being projected for the 
future may, in fact, come to pass. But, from my perspective, 
when I take a look at what is happening to the land, the fact 
that once we lose arable land, you can't replace it; if you 
take a look at the increases in population in this country, and 
you think about the issue of basic food security, I think at 
this point in time it would be unwise for us to speculate on 
whether or not we will need our good agricultural lands in the 
future.
    Ms. Kaptur. You don't think we can import all our food, Mr. 
Reed?
    Mr. Reed. I would not want to go to bed at night thinking 
about that as being a reality.
    Ms. Kaptur. It is happening.
    Mr. Lyons. Ms. Kaptur, if I could just make one point--I 
think not only should there be concern about the loss of arable 
land, but there should be concern about the impact that has on 
our society. We began as an agrarian nation. Consolidation and 
efficiency is a double-edged sword. Consolidation in 
agriculture certainly has had a big impact on certain 
industries, and the Secretary, of course, launched a review of 
the impacts of consolidation on the meat packing industry and 
other industries, and I know he is personally concerned about 
that.
    I share that concern, but I also would emphasize that the 
loss of small to medium-sized farms, family farms, across the 
American landscape can have a tremendous impact on America as a 
society and in those rural communities that we have, I think, 
all come to enjoy, and some of us grew up in. It would be a 
tremendous loss to see American society change so dramatically, 
if we fail to invest in, or at least recognize ways in which we 
may, in fact, be accelerating the demise of small to medium-
sized farms.
    That is one reason that the Secretary called for the 
creation of the Small Farms Commission, which former 
Congressman Volkmer chaired. Many of the recommendations--in 
fact, most of the recommendations--that the Commission 
generated are being implemented under the guidance of Deputy 
Secretary Rominger. So we take this issue very seriously, and 
are very concerned not only about impacts on arable land, but 
impacts on the social fabric of this Nation.

                     backyard conservation program

    Ms. Kaptur. Mr. Reed, I wanted to ask you about the 
Backyard Conservation Program that NRCS launched. I was very 
happy to be a part of that last year. I am wondering what has 
happened as a result of that.
    Mr. Reed. Well, the Backyard Conservation Program has been 
a resounding success. We have had requests for the publication, 
as well as requests throughout the countryside for conservation 
education, assistance in areas in which we haven't had that 
kind of assistance before. We see an enormous increase in the 
awareness and importance of conservation, not only what the 
urban folks can do in their own backyards, but what is also 
being done out in rural America as it relates to conservation. 
So it has been a great educational tool, and I think it has 
done a lot toadvance the importance of soil and water 
conservation in this country.

                       aging watershed structures

    Ms. Kaptur. I notice in your testimony, Mr. Reed, you 
reference that 350,000 nutrient management plans will be 
required for operators of livestock operations, and 450,000 
AFO's that will be required to be addressed by the Clean Water 
Action Plan. An additional 11,000 small watershed dams 
constructed under two authorities will reach the end of their 
design life. You made your comments to this committee a few 
moments ago about not having enough resources to do the job. Is 
this the area in which you feel that your local service people 
will be over stressed?
    Mr. Reed. Yes, absolutely. As it relates to the animal 
feeding operations issue, we are, as we speak, putting together 
some options for Mr. Lyons and Deputy Secretary Rominger that 
will lay out, based on our current estimates, what the workload 
is; what is the legitimate USDA/NRCS-type investment; what 
should the investment of the conservation partners be; what 
should the private sector do. Once we pull all that together, 
we will be in a much better position to talk about how we could 
break that workload down and deal with it.
    But when you take a look at the basic work that we have 
agreed with others that are engaged with us on this, the 
workload is in itself massive for us, and we have some figures 
on that that we would be happy to follow up and provide for you 
on the record.
    [The information follows:]
                   Animal Feeding Operations Workload
    NRCS is developing an Animal Feeding Operation Implementation Plan 
and will have the plan completed by May 1999. Based on the October 1998 
Partnership Workload Analysis, NRCS estimates that about 331,000 animal 
feeding operations with less than 1,000 animal units will need 
assistance in installing a waste storage system and adopting a nutrient 
management plan. The infrastructure investment needed to control water 
pollution from animal feeding operations is enormous and NRCS is 
committed to helping minimize the financial stress on family farmers. 
If all 331,000 animal feeding operations installed a waste storage 
system, the financial assistance costs could range as high as $13.6 
billion over a ten-year implementation period. Even with this financial 
assistance, the producer costs could amount to as much as $4.5 billion. 
Depending on the role of state, local, and conservation district 
employees as well as the private sector in assisting farmers, NRCS 
could require an additional $2.5 billion dollars in funds to support 
technical assistance over a ten-year period. These figures may change 
as the 1997 Agricultural Census data becomes available and as new 
workload data is collected. In addition to the financial and technical 
assistance provided through NRCS, other agencies in USDA have important 
contributions to make in addressing the water quality problems related 
to animal feeding operations. Examples of contributions from other 
agencies include: producer education and research through the 
Cooperative State Research, Education, and Extension Service, research 
by the Agricultural Research Service, and loans administered by the 
Farm Services Agency.

    Mr. Reed. Regarding the issue centered around these 10,000 
dams, up until about 1960, under the Public Law 534 and 566 
programs, we built about 10,000 dams all across America, but 
concentrated in some States more so than others. The primary 
purpose was to control flooding. but also erosion control and 
municipal water supplies, the whole nine yards.
    But the bottom line is that, prior to 1960, all the dams 
that we built were designed to function for 50 years, and they 
are becoming 50 years old. Now, since 1960, we have been 
designing and building dams to last 100 years. So we don't have 
a problem just yet with them, but what is happening is that 
these dams have done what they were designed to do, and now 
they are filling up with sediment. We are finding all kinds of 
stuff in this sediment--some of the old pesticides that we used 
in cotton back 20, 30, 40 years ago, and the list goes on and 
on and on.
    But, more importantly than that, from my perspective, I see 
this as a potential major public health/public safety issue, 
because in the floodplain below a lot of these dams we have a 
lot of urban development. The roads and bridges were designed 
and built based on the hydrology in these watersheds with these 
structures fully functioning. We also have public water 
supplies, sewage treatment plants that are located beneath some 
of these structures. I believe that if we don't do what is 
needed to address the problem, then it is just a matter of time 
before we start to have some major, major safety/health 
problems out in the countryside.
    About four weeks or so ago, Mr. Lyons and I met with the 
Secretary and Mr. Witt from FEMA, and this issue was raised 
there. We are following up with him and the appropriate others 
to make sure that we capture the problem and lay it on the 
table for the public policy folks to take a look at and help us 
decide what needs to be done.

                         ADDITIONAL ASSISTANCE

    Ms. Kaptur. My final question on this round: What is the 
relationship between those needs we have just discussed on that 
page of your testimony and the $866 million appropriations 
request for this next Fiscal Year? Are you asking for 
additional assistance for that in this budget or is that 
exclusive of this request?
    Mr. Reed. It is exclusive of the budget, with the exception 
that there is a million dollars in the request, under Public 
Law 566, for educational assistance relative to the aging 
watershed infrastructure problem.
    Ms. Kaptur. All right. Thank you very much for that 
clarification.
    Mr. Lyons, could you tell me, in your original 
administration budget request that went up to OMB, did you ask 
for $866 million for the year 2000?
    Mr. Lyons. I believe we asked for a little bit more than 
that, Ms. Kaptur.
    Ms. Kaptur. How much did you ask for?
    Mr. Lyons. I am sure someone has that number.
    Mr. Reed. Can we send it up to you?
    Ms. Kaptur. Just ballpark, was it----
    Mr. Reed. It was, for Conservation Operations, it was 
$287,000 more than what the budget shows--no, $287 million. 
[Laughter.]
    Two hundred and eighty-seven million more than what the 
budget shows. That is for conservation technical assistance.
    Ms. Kaptur. All right.
    Mr. Reed. The only other one that I remember that comes to 
mind is, for the aging watershed infrastructure, based on what 
we knew back in July, when we made our initial Department 
estimates, we asked for $250 million to address the aging 
watershed infrastructure problem.
    Ms. Kaptur. All right. I thank you. Any additional 
budgetary information you wish to give us, I would appreciate, 
based on your original submission to OMB.
    Mr. Lyons. We can provide you that table.
    [The information follows:]


[Page 47 -- The official Committee Record contains additional 
    material here]

    Ms. Kaptur. Thank you. Thanks, Mr. Chairman.
    Mr. Skeen. Mrs. Emerson.

                     STAFF REDUCTIONS IN THE FIELD

    Mrs. Emerson. Thank you, Mr. Chairman.
    Mr. Reed, first of all, let me say, I have very much 
respect for all of the NRCS personnel with whom I work and my 
staff works in my district in southern Missouri. So my hat is 
off to you. It is a special team of people that you all have.
    But let me just ask for a clarification. When you and the 
chairman were discussing staffing reductions, and the figure 
1,000 was mentioned, are those 1,000 people in the field or are 
they here in D.C.?
    Mr. Reed. In the field.
    Mrs. Emerson. Okay.
    Mr. Reed. Can I respond to that a little further?
    Mrs. Emerson. You may. Please.
    Mr. Reed. The reason it would be mostly in the field is 
that, as you know, since 1993, we have gone through substantial 
streamlining, downsizing. Mr. Lyons and Paul Johnson, and when 
I worked with the two of them before Mr. Johnson left, we put 
at the top of our priority list taking everything that we 
possibly could out of everything above the field first. We have 
done that, and we will continue to take whatever we possibly 
can above the field. But there is nothing left, and the only 
place where we can make cuts wouldbe at the field level.
    Mrs. Emerson. This is probably an unfair question to ask, 
but has NRCS staff been reduced more proportionately than some 
of the other offices within the USDA?
    Mr. Reed. When you take a look at the importance of our 
work, yes. [Laughter.]

                              AFO STRATEGY

    Mrs. Emerson. That is a pretty good political answer. All 
right. Well, thank you. That was pretty good. We should run you 
for office. [Laughter.]
    All right, Mr. Lyons, this question goes to you, please: 
You make a comment on page 9 of your testimony--hold on; I have 
to put my glasses back on here--that says, with regard to 
animal feeding operations, specifically, that you can never 
fully meet the workload, if you will, about providing technical 
assistance to producers as they try to comply with your animal 
feeding operation strategy. Now if you all can't commit to 
providing the necessary technical assistance, then how are our 
producers--how can we expect them to comply properly?
    Mr. Lyons. Well, as you may be aware, the AFO strategy that 
we have developed, and floated for public comment, and 
discussed across the Nation, is primarily focused on and 
emphasizes voluntary approaches. We firmly believe that is the 
way to get the job done. I think producers would agree. They 
would rather have that option than the regulatory option.
    But, as is often the case in Washington, good policy and 
the budget to implement it don't always go hand-in-hand. I 
think part of what we are asking here today is that you help 
work to recognize and address what could be a deficit in terms 
of the resources needed to help these producers.
    It really is a relatively small handful of the 450,000 
producers who are of sufficient size that they may actually 
fall under the regulatory framework of EPA, at least in 
accordance with the strategy we have devised. I think many 
producers, particularly working together in common watersheds, 
can address these water quality concerns collectively in a way 
that will avoid their having to worry about Clean Water Act 
compliance issues. But we are going to need additional 
resources.
    Mrs. Emerson. So do you think maybe we ought to delay the 
rules until NRCS can supply the assistance necessary? Would you 
be supportive of that?
    Mr. Lyons. No, I don't know that I would be supportive of 
that, Congresswoman, because I believe that we do have clean 
water concerns across the Nation that need to be addressed. I 
think we need to work together, the administration and the 
Congress, to generate the resources. We are looking at phasing 
this in over time. We know current resources are inadequate, 
and we believe we do need additional resources. But I think we 
have an obligation, and I have yet to meet a producer, with few 
exceptions, who doesn't want to help ensure that these good 
landowners are good land stewards and that they are able to 
meet those goals. That is why we have used the delivery 
mechanism we have, the voluntary approach, to get there.

                    ECONOMIC ANALYSIS OF AFO IMPACT

    Mrs. Emerson. Is there any kind of an economic analysis as 
to how the rules might impact producers economically?
    Mr. Lyons. I don't know that I have that information in 
hand.
    Mrs. Emerson. If you have done one, then may I ask that you 
provide it?
    Mr. Lyons. Sure, we can provide that for you.
    [The information follows:]
                   Economic Analysis of AFO Strategy
    Since the Unified National Strategy for Animal Feeding Operations 
(UNSAFO) is not regulatory in nature, it does not require an economic 
analysis. Nevertheless, the Strategy calls for EPA and USDA to 
collaborate on evaluating the overall costs and benefits of the 
Strategy. In addition, if EPA promulgates a rule expanding its 
authority under the Clean Water Act to regulate animal feeding 
operations, an economic analysis will have to be prepared by EPA 
because of laws and executive orders governing the need to assess the 
economic impact of regulations on the private sector.
    On the voluntary side, NRCS is developing an Animal Feeding 
Operation Action Plan that complements the Strategy. A Draft 
Implementation Plan is scheduled to be completed in May 1999. Although 
no definitive economic analysis of the Implementation Plan has been 
made to date, preliminary national estimates of the financial and 
technical assistance needs have been made. Based on the October 1998 
National Partnership Field Workload Analysis, NRCS estimates that about 
331,000 animal feeding operations with less than 1,000 animal units 
will need assistance in installing a waste storage system and adopting 
a nutrient management plan. The infrastructure investment needed to 
control water pollution from animal feeding operations could be 
substantial and NRCS is committed to helping minimize the financial 
stress on family farmers. If all 331,000 animal feeding operations 
installed a waste storage system, the financial assistance costs could 
reach $13.6 billion over a ten-year implementation period. Even with 
this level of financial assistance, producer costs could amount to at 
least $4.5 billion. Depending on the role of state, local, and 
conservation district employees as well as the private sector in 
assisting farmers, NRCS could require an additional $2.5 billion 
dollars in funds to support technical assistance over a 10 year period. 
These cost estimates may change as new data on AFO numbers and workload 
becomes available through the 1997 Agricultural Census and the 2000 
National Partnership Field Workload Analysis. In addition to the 
financial and technical assistance provided through NRCS, other 
agencies in USDA could have important contributions to make in 
addressing the water quality problems related to animal feeding 
operations. Examples of contributions from other agencies include: 
producer education and research through the Cooperative State Research, 
Education, and Extension Service; research by the Agricultural Research 
Service; and loans administered by the Farm Service Agency.

                    AFO STRATEGY LISTENING SESSIONS

    Mrs. Emerson. Because I know there were some meetings held 
around the country, bringing the stakeholders in, have your 
folks actually gone out to ranches and farms and talked to 
people? It is just that I haven't gotten any specific feedback 
from my people that they have been approached or this issue has 
been discussed with them?
    Mr. Lyons. Yes. In fact, we held a dozen listening sessions 
across the country and invited producers to come in and speak. 
I attended a number of those. My colleagues at EPA--Glenda 
Humiston here, who is my Deputy for Conservation, participated. 
I think we got a healthy helping of farm reality in the 
discussions we had.
    I should point out that what we are issuing is a strategy. 
We are not issuing specific rules. EPA would be responsible for 
issuing any rules to comply with the Clean Water Action Plan. 
So I don't think there has been an economic or cost-benefit 
analysis on rules yet, but I will talk to my colleagues and 
make sure whatever information we have on potential economic 
impacts we provide you.

                    IMPACT OF GLOBAL CLIMATE CHANGE

    Mrs. Emerson. Well, that would be very helpful because 
oftentimes that is the last thing that is thought about when 
new rules and regulations are imposed on producers, small 
business people, et cetera.
    Let me just move very quickly--I have a question with 
regard to global climate change, and specifically, I want to 
refer to a study that was recently completed by the Sparks 
Company, on behalf of the corngrowers, the Farm Bureau, and 
other producer organizations, that predicts about a 50 percent 
decline in farm income, doubling of production costs, et 
cetera, et cetera. In fact, Mr. Chairman, I would like to 
submit that study for the record, if I might.
    [The information follows:]



[Pages 51-53 -- The official Committee Record contains additional 
    material here]


    Mrs. Emerson. But, anyway, let me ask you--I think the 
Department has been asked on numerous occasions also about any 
kind of economic analysis that you all might have done with 
regard to climate change and how it would impact agriculture. 
Do you know if that has been done yet?
    Mr. Lyons. I can't answer that. I will have to check with 
Keith Collins, who is our Chief Economist, and provide you 
whatever information.
    Mrs. Emerson. Okay. I would be very grateful if you could, 
in fact, do that.
    [The information follows:]
              Economic Analysis for Global Climate Change
    Global climate change has been a topic of growing concerns to USDA 
as well as many other Federal departments. The work you are asking 
about is being handled by the Global Climate Change program that is 
attached to the Office of the Chief Economist. We understand that the 
Economic Research Service is assisting in this effort. We would 
encourage the committee to contact the Global Climate Change program 
office for any specific information that is desired.
    From a weather variability standpoint, the following is drawn from 
the March 2nd testimony presented by the Chief Economist to the Senate 
Committee on Appropriations, Subcommittee on Agriculture, Rural 
Development and Related Agencies:

    ``Weather and agricultural production. Last year's heavy rain and 
flooding in California and drier than normal conditions in the Southern 
Plans and South highlighted the role of weather in crop production and 
farm financial conditions. The current La Nina weather event is having 
a limited effect on U.S. agriculture, with the possible exception of 
the December freeze in California that severely reduced citrus 
production. La Nina is not expected to be a major factor affecting 
global or U.S. crop production this year. However, weather forecasting 
remains imprecise and the possibility remains that adverse weather 
could cause a major shortfall in world crop production and a strong 
increase in prices from current levels.''

    Mrs. Emerson. That is all. Thank you very much, Mr. 
Chairman.
    Mr. Skeen. Five-and-a-half years waiting to ask this 
question--Mr. Farr.
    Mr. Farr. Mr. Chairman, you knew my desire to be here at 
this moment. I have been in Congress five-and-a-half years, and 
I have been waiting for this moment. I have more questions than 
this book is thick [indicating]. [Laughter.]
    But I am delighted to be here.
    I wanted to share with the committee what hit me. I fly 
every week out of Dulles Airport to San Francisco Airport. I 
get on a United flight, and then the flight attendants tell us 
we are going to go 2,419 miles. I look out there and I see the 
great Mississippi Basin and the Great Plains and fly over the 
Rockies and the Grand Canyon and into the West, into the 
incredible resources of the Sierra Nevadas, Yosemite National 
Park, come through the great agricultural basin of the San 
Joaquin Valley into the coastal zone of California. It hit me, 
as I look out that window, that all of the discussions about 
land in the United States--our park system, our national forest 
system, nothing compares to the power that this committee has 
on land use in America.
    This is really our land use committee. What we are talking 
about in this subject matter is proper management of the land, 
proper best management practices, and how we incorporate that 
into user practices, so that the soils don't erode; so that the 
water doesn't become polluted. I think it is a bigger picture 
than that. It is also about sustainable agriculture. You can't 
have just land preserved, if you can't make a buck off what you 
are trying to do with the land.
    But the way we make bucks off land in California, 
unfortunately, is just urban sprawl. We cover over our 
agricultural lands to build boxstores like the Costcos and Wal-
Marts. The land that we have just killed grows products that 
are grown in America that we export abroad, and the stores that 
we build import products made somewhere else. So we are not 
only killing our land, productive land; we are killing our 
productive labor force with importing things that are made. So 
this committee and this issue about how we use our land is to 
me just the most important thing we can be dealing with in 
Congress.
    My question essentially goes to the point, I started in 
politics as a county supervisor dealing with land use. Then I 
was in the State legislature, and I sat on a natural resources 
committee and carried a lot of education. I came to Congress, 
and not until I arrived here had I ever heard of the Natural 
Resources Conservation Service. I know you are doing all these 
things, but I don't know if a lot of people really who make the 
daily decisions know about them.
    My question goes to, do you have any model ordinances that 
you have gotten adopted by counties and local governments 
regarding best-use practices?

                ADOPTED ORDINANCES OF BEST-USE PRACTICES

    Mr. Reed. The answer to that is no, and the reason the 
answer is no is that we have worked with local units of 
government, and, basically, did most of the work as it relates 
to soil and water conservation, but we never took credit for 
it.
    Mr. Farr. But the suggestion is--and I think it goes to all 
the questions here about, why should we be doing all this sort 
of heavy parrotting of the land without teaching the land users 
how to do it themselves? Why aren't we teaching local 
governments how to fish? I mean, how to care for the land 
themselves. I don't know why we need to buy out land that 
should not be farmed; it should be zoned that way. We don't 
allow people to build or tear down riparian corridors just 
because they privately own it. Local government says, no. 
Private ownership doesn't allow you to destroy valuable soils. 
Private ownership doesn't allow you to pollute. Just because 
you own the land, you can't dump toxics there.
    So we, obviously, have this sense in America, and I think 
in the private sector that owns all this land that I am talking 
about, that it is cared for, but the policing of that has to be 
done at the local level. We can't do that from Washington.
    Mr. Reed. Mr. Farr, virtually all of the work of the NRCS 
is really working with the farmers and the ranchers and other 
decisionmakers, providing them with the appropriate technical 
advice, counsel, and in some cases financial assistance, so 
that they can make the decisions out on the land. Virtually 
everything that we do is done in a voluntary mode in support of 
State and local governments.

                      FARMLAND PROTECTION EFFORTS

    Mr. Farr. Why should we be giving aid to the farmer 
directly; why should we be giving aid to the local county 
government, if they aren't incorporating within their 
management practice sort of a building code of best practices? 
Why don't we insist that they put land management plans in the 
law in order to get the benefit? There has got to be a carrot 
and a reward here.
    Mr. Reed. Most of the farmland protection programs, most of 
the land use zoning ordinances, laws, and regulations out in 
the countryside are based on the NRCS technical guide, 
technical rules, technical specifications that we have 
developed in a voluntary mode, and these local units of 
government adopt those as the basis for making those decisions.
    Mr. Farr. I would hope you are right, Mr. Reed, because if 
you are, then we don't need to do all this stuff, because it 
would be done at the local level. Once we have been there, we 
never have to go back. It is going to be taken care of.
    Let me just switch because, obviously, if we had done it 
all, we wouldn't need the Farmland Protection Program, and I 
was very pleased to hear Mr. Lyons talk about going to the 
Governors Conference and having that incredible reception. What 
was it like? They really want us to participate in it, don't 
they?
    Mr. Lyons. There is tremendous enthusiasm for protecting 
open space and farmland protection. As you know from your own 
State, the Federal Farmland Protection Program which we 
administer is oversubscribed manyfold.
    Mr. Farr. Can I ask you some questions about it? First of 
all, I want to commend the President for putting money in. At 
the same time, I want to wonder why it is such a measly amount. 
Seventy-seven point five million comes out to $1.5 million per 
State, and California, in my Salinas Valley, it is $20,000 an 
acre. So all the money we give to California buys sixty acres 
of land. That is not farmland protection.
    Mr. Lyons. Well, I would certainly wish we could put more 
in the account, Congressman, but I would point out that that 
money leverages additional resources. Our goal isreally to be 
able to partner with States that have put money into programs, with 
communities that have put money into programs, so as to amplify the 
benefit of that Federal investment. It is really seed money to make 
those things happen.

                    requests for farmland protection

    Mr. Farr. What are the requests you have in hand right now 
from the States asking for the farm? Do you know that?
    Mr. Lyons. I am sure we do.
    Mr. Farr. Do you know how much they are requesting?
    Mr. Lyons. Do you have those numbers [speaking to his 
staff]?
    Mr. Farr. Well, you can get those for me.
    Mr. Lyons. We can provide those for the record, if that 
would help.
    [The information follows:]

                      Farmland Protection Program

    Through fiscal year 1998, twenty states had requested 
$198.3 million to FPP funding. NRCS committed $33.4 million in 
Federal funds to 19 States for farmland protection efforts.

                                              [Dollars in millions]
----------------------------------------------------------------------------------------------------------------
                                                               FPP funds     Proposed    FPP funds      Acres
                         Fiscal year                           requested     acreage     available     expected
----------------------------------------------------------------------------------------------------------------
1996........................................................       $130.6      176,000        $14.3       76,756
1997........................................................          6.5       10,000          1.9        4,969
1998........................................................         61.2       99,000         17.2       45,658
                                                             ---------------------------------------------------
      Total.................................................        198.3      285,000         33.4      127,383
----------------------------------------------------------------------------------------------------------------

                conservation reserve enhancement program

    Mr. Farr. I hear the bells going off.
    One is: How many States have approved conservation reserve 
enhancement programs?
    Mr. Lyons. I believe it is a half dozen, six.
    Mr. Farr. That is all?
    Mr. Lyons. That is right.
    Mr. Farr. How many acres have enrolled in these programs 
across the country?
    Mr. Lyons. We are conferring.
    Mr. Farr. Well, we are spending millions of dollars, and we 
have got six programs. Do you know how many----
    Mr. Lyons. I don't know that I can tell you the acres. We 
will get that information for you, the acres that have enrolled 
through the CRP program.
    [The information follows:]

                Conservation Reserve Enhancement Program

    Currently, seven states have approved Conservation Reserve 
Enhancement Programs (CREP). They are Maryland, Minnesota, 
Illinois, New York, Oregon, Washington, and, as of March 1, 
1999, North Carolina. Secretary Glickman and Governor Hunt of 
North Carolina signed the North Carolina Memorandum of 
Agreement on March 1. Conservation Reserve Enhancement Programs 
are voluntary and must address environmental problems of 
Federal and or State significance caused by agricultural 
activities. States must request to enter into a Memorandum of 
Agreement, for a CREP proposal, with the U.S. Department of 
Agriculture to address these environmental problems.
    To date, approximately 811 contracts, covering 13,494 acres 
have been enrolled in CREP programs across the country.

                        buffer strip initiative

    Mr. Farr. Can you also give me how many acres have been 
enrolled nationwide in the Buffer Strip Initiative?
    Mr. Lyons. Yes, we can provide that easily.
    [The information follows:]
                  Buffer Strip Initiative Enrollments
    Approximately 930,000 acres of buffers--265,000 miles--have been 
enrolled nationwide in the Buffer Strip Intiative.

                        release of afo strategy

    Mr. Farr. And do you know when the animal feeding operation 
strategy will be released?
    Mr. Lyons. We hope shortly. We have actually completed the 
work that we need to do, and we are working with EPA to resolve 
some remaining differences on the strategy, but we hope very 
shortly.
    Mr. Farr. And have USDA and EPA done an estimate on the 
funds necessary to meet the current demand for the EQIP program 
as well as the expected increase in demand that may occur as a 
result of the Clean Water Action and the AFO strategy?
    Mr. Lyons. I can provide you that information for the 
record. It is going to be substantially more than what I think 
we are requesting right now. The $100 million increase in EQIP 
certainly will help in terms of our efforts to address clean 
water strategy.
    [The information follows:]
                  EQIP Funding Needs To Carry Out CWAP
    NRCS has done some preliminary estimates on the funds needed to 
meet the current demand for EQIP. We have identified the demand to be 
about 3 times the available EQIP funds since the beginning of the 
program. In FY 1997, there were over 57,000 applications from farmers 
and ranchers requesting $552 million in financial assistance; about 
$175 million of this demand was met by EQIP contracts. In FY 1998, 
about 55,000 applications were received for $490 million in financial 
assistance; about $154 million of this demand was met by EQIP 
contracts.
    The demand comes from producers who are indicating they are 
prepared to invest some of their own funds, change some of their 
farming techniques and apply conservation practices to improve natural 
resource conditions on land they control. Not all of these producers 
would be considered as high priority; some may be ineligible. But on 
the whole, this gives a good perspective of the demand. As the program 
becomes better known, we expect the demand to increase.
    Considering this demand, and without considering the impact of the 
Clean Water Action Plan and the Animal Feeding Operations Strategy, 
NRCS believes that an annual funding level of $400 million would be 
justified. To suggest higher at this time would be unrealistic 
considering the current capacity for NRCS to adequately implement the 
program with a greater workload. The Administration's $300 million 
budget request is a good first step to meet the demand while being able 
to implement the program in an exceptional manner with current staff 
resources.
    Successful implementation of the Unified National Strategy for 
Animal Feeding Operations (AFOs) owners and operators could require the 
delivery of technical and financial assistance to more that 331,000 
AFOs nationwide by the year 2009. Delivery of this technical and 
financial assistance through voluntary conservation programs; primarily 
EQIP, will need to be greatly accelerated to achieve this goal, 
especially considering that NRCS is only able to assist roughly 10,000 
AFOs per year through on-going programs.
    If our conservation partners and private sector vendors are not 
able or willing to substantially increase the technical and financial 
resources they can devote to the effort, USDA will need to increase 
annually by at least 3 times its technical assistance funding and by at 
least 10 times its financial assistance funding over the FY 2000 
requested funding levels to meet the potential demand.

    Mr. Farr. And will you also send me how much out of the 
EQIP program of USDA's resources are going to the Colorado 
River Salinity Control Program?
    Mr. Lyons. We would be pleased to do that.
    [The information follows:]
      EQIP Funding of the Colorado River Salinity Control Program
    The following EQIP funds were used in Colorado, Utah, and Wyoming 
to reduce the salinity in the Colorado River. The FY 1997 and 1998 
funds were actually obligated, and the FY 1999 funds have been 
allocated for use in the basin.

----------------------------------------------------------------------------------------------------------------
                                                     Financial       Education       Technical
                   Fiscal year                      assistance      assistance      assistance         Total
----------------------------------------------------------------------------------------------------------------
1997 (obligated)................................      $2,812,000        $ 26,000        $315,000      $3,153,000
1998 (obligated)................................       2,808,000         113,000         685,000       3,606,000
1999 (allocated)................................       3,029,000         114,000         737,000       3,880,000
----------------------------------------------------------------------------------------------------------------

    Mr. Farr. Thank you. Thank you, Mr. Chairman. I wish you 
would give me two days, because I love this.
    Mr. Skeen. Well, we will see if we can't work out 
something. [Laughter.]
    We will suspend now and take this vote, and be right back. 
I think this is the last vote for today, hopefully.
    [Recess.]
    Mr. Skeen. The committee will come to order.
    Mr. Bonilla.

                  american heritage rivers initiative

    Mr. Bonilla. Thank you, Chairman.
    Good afternoon, everyone.
    I am anxious to get into discussion about the shortage of 
manpower and the expansion of programs in just a second. But, 
first, I want to ask a question, Mr. Lyons, the request--for a 
report we included last year in our report language to ask for 
the activities of the USDA on the American Heritage Rivers 
Initiative, and the report did request that the AHRI report 
come in to the Committee by December of 1998. Do you know when 
we can expect to receive this report, Mr. Lyons?
    Mr. Lyons. That report is currently in clearance, 
Congressman, and we expect to get it up to you shortly. We 
apologize for the delay.
    Mr. Bonilla. So you think in a matter of weeks perhaps, 30 
days, something like that?
    Mr. Lyons. I certainly hope so. It shouldn't take very 
long.
    Mr. Bonilla. I would appreciate that. I appreciate your 
attention to that.
    Also, in light of that and in light of what we have heard 
here today, especially with Mr. Reed saying, appropriately so--
I wrote down that his quote was, ``Being asked to do much with 
too little.'' In light of the fact that there is a request for 
an additional $204,000 for the American Heritage Rivers 
Initiative in Fiscal Year 2000, I am concerned where this money 
might be coming from. In other words, is there a possibility 
that something that you are already working on that is very 
important is going to get shortchanged. Initially the 
administration stated that there would be no new funds for the 
AHRI program. So where is this money going to come from, and 
what program could get shortchanged?
    Mr. Lyons. Well, I will take a shot at that, Congressman. 
The investments we have made in the American Heritage Rivers, 
which I believe come out of Conservation Operations, by and 
large, are, in my mind, minimal. The potential payoff is 
tremendous. We have only allocated a few FTE's to this effort.
    The reason I think it is a wise investment is because 
Ithink it affords us an opportunity to coordinate water quality and 
watershed activities along designated rivers and really to amplify the 
benefit of working with other agencies and their resources to work with 
those communities to realize their conservation goals along those 
waterways.
    One could argue that $200,000-or-so could be invested 
elsewhere, but I would tell you that I am a firm believer in 
working with communities who have a desire and seek the 
assistance that government can provide them. I think that is an 
important and appropriate role. I think through American 
Heritage Rivers, we are going to learn a lot about how we can 
work with communities to encourage their collaboration with 
adjacent communities, with other agencies, and I think there is 
going to be tremendous payoff that we may use in other places.
    Mr. Bonilla. So, again, could you tell me where that money 
would come from?
    Mr. Lyons. I believe it comes out of the Conservation 
Operations account. The estimates I have before me, 
Congressman, were----
    Mr. Bonilla. In other words, who is going to get 
shortchanged by this amount of money? I realize in the big 
scheme of things it is minuscule, but you are talking a couple 
of employees that you could have somewhere else.
    Mr. Lyons. Well, I can't point to a specific place they are 
going to come from, but I think we are going to try to ensure 
that the impact on any program is going to be minimized. I 
think we can guarantee that.
    Mr. Bonilla. As you know from last year--we had a talk 
about this as well at the hearing, and I was concerned about 
it. Let's take, for example, I cover 29 counties in south and 
west Texas, but I live in San Antonio. If any of you have been 
there, you know that we have developed a River Walk very 
nicely, a conservation program, environmental assessments, the 
whole nine yards. The community is very happy with it. It was 
done, believe it or not, without American Heritage Rivers 
Initiative involvement. There are countless other projects 
around the country that are environmentally sound. They have 
been done efficiently. They have been partnered with Federal 
Government programs and have worked very well.
    Yes, I have had a problem with American Heritage Rivers 
Initiative because I see these things that have occurred 
already, and I don't understand, for the life of me, why we 
need another layer of bureaucracy that involves not just USDA, 
but 12 other Federal agencies. Just so you know where I am 
coming from on this.
    Mr. Lyons. Well, let me respond, if I could, and just say I 
think the San Antonio situation is a good example of what other 
communities would like to mimic in terms of the investments 
they would like to make in their waterfronts. Unfortunately, 
many communities don't have the resources or wherewithal to 
attract the private investment, such as San Antonio did, that 
really, as you know, rejuvenated downtown and really has become 
a tourist attraction and brings a lot of resources into the 
community and a lot of tax dollars into local government.
    I think we would like to use that example to try to help, 
with a minimal investment of Federal resources, other 
communities realize the goals that they seek. I think in the 
rivers that we have identified there is tremendous opportunity 
to do that, and, ultimately, hopefully, shift the financial 
responsibility over to the private sector. We are certainly 
looking for ways in which private dollars can amplify the 
minimal investment that we will make through Federal resources.
    Mr. Bonilla. And a final note on that, and then we will 
move on. That was, in fact, the result of a great initiative by 
former Mayor Henry Cisneros with the business community, and it 
was done very nicely. It is something that we hold in high 
regard, and we are very proud of back home, but it was, again, 
that local initiative. It is not a wealthy area at all, but it 
was just the initiative and thepersistence of those who wanted 
to make it happen in the right way that prevailed in the end. That was 
even before American Heritage Rivers Initiative was even discussed.

                            regional offices

    I want to move on now to something else. The NRCS regional 
offices. Are the regional offices vitally needed to effectively 
deliver programs and accomplish the mission or NRCS in 
assisting landowners with their conservation needs? Again, this 
is tied into some of the frustrations that are being expressed 
here today about manpower.
    On page 17-7 of this year's budget, the note states that it 
is one of the things that regional offices were intended to do, 
is to, quote, ``reduce operating costs.'' How does the creation 
of an additional layer of bureaucracy, if you will, reduce 
operating costs and help you with your personnel problems?
    Mr. Reed. Mr. Bonilla, I am, as we speak, reevaluating our 
situation with regional offices, but I need to go back and tell 
you why we established those, going back four or five years 
ago, and the intent. The intent of the regional offices was, in 
fact, to help us be more efficient and effective, in addition 
to providing the appropriate focus that is needed at the 
regional level on issues, resource issues, that cross State 
boundaries.
    But, initially, at these regional offices, what we did was 
we took the 56 or so business offices that we had in this 
country, where we had anywhere from 15 to 42 people, abolished 
all of those, established six of those with approximately 17 
people, and that was an integral part of our streamlining plan 
for reducing the administrative support. We figured that we 
could do it out of 6 locations far more efficiently than we 
could out of 56. So that was one component of the regional 
offices.
    Mr. Bonilla. What was your net reduction, then, on 
manpower?
    Mr. Reed. That was a part of our overall agencywide 
initiative to cut our administrative staff by 50 percent. We 
are about to reach, although we are going into the 
administrative convergence, which is another issue. But that 
was one.
    The next thing that Chief Johnson, Jim, and I wanted to do 
was that, at that point in time, we had a lot of oversight 
reports and criticism coming from the Inspector General, coming 
from other places--and we can produce those reports for you--
basically saying that we were not providing cross-State, 
regional kind of oversight in dealing with issues. Some of the 
Inspector General--IG--reports, as an example, showed that, 
when you crossed a river, one county to the next, they found a 
different set of standard specifications, those kinds of 
things, and that land on one side of a State line was being 
treated different in terms of wetlands kinds of issues. So we 
recognized the need to beef up our oversight and evaluation-
type activities. So we ended up putting about four or five 
people in each of the regional offices to do that.
    Then the other thing that we did there is that in each and 
every State we had a State administrative officer; we had a 
deputy and/or an assistant State conservationist; we had three 
or four program managers. We felt at the time--and we still 
feel this way--that those functions we did not have to have in 
each and every State. Again, that was a part of our efforts to 
try to cut the total number of folks we were investing in that 
kind of work by approximately 50 percent. So those folks ended 
up in the regional office. That, coupled with a regional 
conservationist, is what the regional offices were about.
    I can tell you that right now some of the functions that 
are at the regional offices are functions that we are going to 
have to carry out irrespective of where it is carried at. I 
think as USDA deals with the administrative convergence issue, 
then we have to decide what we can or what is appropriate for 
us to do in addressing the regional office issue.
    Mr. Bonilla. Thank you, Mr. Reed. Mr. Lyons.
    Mr. Lyons. If I could just point out, just to set the 
record straight in terms of how our staffing levels play out, 
under the 1999 budget, we currently have 139 individuals in 
regional offices, which compares to 9,274 in the field and 
other areas. So we have a very small staff that is helping try 
to coordinate and improve the efficiencies Pearlie addressed of 
work by addressing these issues at the regional level.
    I also want to note, in part responding to a question that 
Mrs. Emerson raised earlier, NRCS has cut its total number of 
employees by about 18.8 percent since 1993. The Washington 
office was reduced by 40 percent. So we have made an extra 
effort to try to make sure we kept people on the ground and 
took disproportionate number of cuts in the Washington staff, 
so as to make sure we had people on the ground who could do the 
job and try to minimize the administrative overhead that 
exists.

                       epa budget request for afo

    Mr. Bonilla. I have a different area I want to cover now, 
Mr. Lyons. A program here that was brought up a little earlier 
that we touched on, I understand your concerns about the 
exponential expansion of your workload which could occur due to 
the implementation of the animal feeding operation strategy for 
the regulation of livestock operations. We see that there are 
some additional monies directed toward this effort in the 
Administration's budget. Do you know if any of the money was 
included in the EPA budget for the implementation of these 
requirements which are being imposed by EPA? I am trying to 
find out if EPA is being totally responsible for these costs, 
since they are coming up with these regulations.
    I know you may not have that in front of you, but I am 
raising this issue.
    Mr. Lyons. Well, I don't have those numbers in front of me. 
I want to point out again, though, we are working on the 
strategy in our regulations, just as a point of clarification; 
these are not rules that we are issuing. I know that EPA has 
some funds built into their Fiscal Year 2000 request. I would 
have to get the details for you and submit it for the record, 
if I could.
    Mr. Bonilla. I would appreciate that.
    [The information follows:]
                      EPA Budget Requests for AFO
    The President's FY 2000 budget includes funding for EPA programs 
that can be used to implement the Animal Feeding Operation (AFO) 
Strategy. In FY 1999, as part of the Clean Water Action Plan (CWAP), 
the Administration requested and Congress provided almost a doubling of 
funding for EPA's section 319 Nonpoint Source grant program, for a 
total of $200 million. for FY 2000, the Administration has again 
requested $200 million for section 319 grants to help implement the 
CWAP, including the AFO Strategy. Another available program is the 
Clean Water State Revolving Funds (CWSRF), which can provide below-
market-rate loans to nonpoint source management projects, consistent 
with a state's nonpoint source management plan. The FY 2000 request for 
the CWSRF is $800 million. For FY 2000, the Administration has also 
submitted a legislative proposal, as part of its budget request, to 
allow states to use up to 20 percent of their CWSRF capitalization 
grant to provide grants for implementation of nonpoint source and 
estuary management projects. This proposal could provide as much as 
$157 million for these grants in FY 2000, if legislation is enacted. 
AFO nonpoint source management projects are eligible for funding from 
these programs. Each state chooses which projects receive funding under 
both section 319 grants and the CWSRF.

                           new funding areas

    Mr. Bonilla. I guess one final thing, Mr. Chairman, if I 
could: In light of the reductions you just talked about and the 
workloads that the NRCS has, in asking for these new 
conservation technical assistance funding areas, such as $31 
million for the Clean Water Action Plan--and I won't get into 
all the details here--$15 million for soil carbon sequestration 
research, and reduction of greenhouse gases. I know that there 
is an indication that this is a mandate that you have to comply 
with, but I think that is in question. Three million dollars of 
this would be for the Climate Change Technology Initiative; $5 
million to fund 20 full-time equivalents, FTEs, staff for 
Community-Federal Information Partnerships, which is part of 
something called the Livability Initiative.
    All these things sound great, and I understand that 
sometimes decisions are made at a higher paygrade about what 
the priorities ought to be, but in light of the fact that you 
all are stretched so thin already, I wonder if this is 
troubling to you that all of these programs I just cited here 
add up to $51 million. Does it trouble you to see all these 
things thrown at you?
    Mr. Lyons. Well, I will try to answer that and tell you 
that, frankly, I don't view all those things as being thrown at 
me. Maybe I am volunteering to accept some of these 
initiatives, in part because I think one of our jobs is to 
promote innovation and identify new ways in which we can 
improve our delivery systems and tackle challenges that we 
face.
    The investments we are making in global climate change and 
livability are, granted, minimal. I wish we had more resources 
to make those investments, as well as cover our base programs. 
But I think we can learn a great deal through the research and 
the evaluations we do on the global climate change, as well as 
I think we can do a great deal to help communities plan for 
their future through the investments we make in the Livability 
Initiative. These are largely minimal investments, but the 
potential payoff that comes of learning from these investments 
I think makes them worthwhile. That is really why we are trying 
to make those investments.
    We don't have a big budget. These are not significant 
investments, but I think they are important.
    Mrs. Emerson. Would the gentleman yield?
    Mr. Bonilla. I would be happy to yield, Ms. Emerson.
    Mrs. Emerson. Mr. Lyons, except for the fact that, if you 
add all those up, together it adds up to the salaries of the 
thousand people that you all have to let go in the field who 
still have projects that they haven't continued or must 
continue to improve upon, or that they have just begun in other 
areas. So I guess what I am saying is you are starting a bunch 
of new programs at the expense of a thousand people who provide 
a very valuable service at the ground level. You all have also 
said that you were going to have to do a lot more with a lot 
fewer people.
    Mr. Lyons. That is fair criticism, Congresswoman. I would 
suggest, though, from my point of view, we ought to get fair 
reimbursement for the work we already do through the CRP 
program and CREP and related programs, and that is why we have 
asked for a lifting of the section 11 cap on CCC-supported 
funds, so that we get what we deserve there. So I don't see 
that as an expansion of programs. I think it is just 
reimbursement for the work we do and an opportunity to make 
some minimal investments to see if there aren't other ways in 
which we can improve our delivery systems and the effectiveness 
of our programs. That is just a different point of view.
    Mr. Bonilla. Just a final comment, Mr. Chairman, I know I 
am a little over my time here. I am one of those unusual people 
that came straight out of the private sector into this job a 
little over six years ago. In a dream world you can think of 
all these initiatives that sound wonderful, and you want to try 
to fund them all, but in real life, generally, you have budgets 
and you have to make priorities. Say, if you have 10 items, you 
have got to pick the top 8. Maybe you don't have any money for 
that beyond eight.
    I am trying to suggest here is for us to look at what is 
really the most important thing that we need to do here and be 
realistic about the dollars that we have in the budget. That is 
where I am coming from.
    Thank you, gentlemen, very much.
    Mr. Skeen. Mr. Boyd.

                technical assistance versus enforcement

    Mr. Boyd. Thank you very much, Mr. Chairman, and, Secretary 
Lyons and Mr. Reed, and your staff, for being here.
    I am a new member of the committee, and I think it is fair 
for you to know a little bit about where we are coming from. I, 
like Congressman Farr, have been looking forward to this 
meeting today. The reason I have been looking forward to it is 
because I spent most of my professional life dealing with the 
old Soil Conservation Service, now called the NRCS. Probably in 
the area that I come from in north Florida, most of the farms 
there would not be viable agricultural entities if it wasn't 
for the work that has been done hand-in-glove with the old Soil 
Conservation Service to make those parcels of land productive. 
I know that is certainly true on the farm that I was raised on. 
So I have a deep appreciation for the work that has been done 
in the old SCS and now the NRCS.
    But the problem that I have--and I have had this discussion 
many times with people up and down your chain of command, 
including Niles Glasgow in Florida, and some of the people that 
work for him--is that, up until 10 or 12 years ago, the Soil 
Conservation Service was viewed by the farming community, the 
ag community, as a technical assistance agency in helping them 
solve conservation problems. That view of the agency has 
totally shifted now in my part of the world from a technical 
agency which is there to help farmers to an enforcement agency, 
which many times comes and bangs on us about things that we 
have to do.
    I took note of your statement, Mr. Reed, about staffing 
problems, and I agree; I know you have great problems in this 
area and they are not all of your own doing; much of them were 
brought on by funding problems.
    But I wanted, Mr. Lyons to address the issue, if you could, 
regarding the agency changing from being a technical assistance 
agency to an enforcement the agency.
    Mr. Lyons, you made a statement in your written 
presentation that says this: ``The NRCS cooperative team 
structure''--it is on page 5--``is an established and practical 
example of how Federal programs can be managed with local 
guidance at the local level.''
    I would take issue with that because our people have a 
tremendous amount of difficulty getting response, a timely 
response, to their applications and their needs. You know, you 
might look at the FSA as a practical example of how 
localguidance at the local level works, because of the county committee 
structure. The NRCS doesn't have a county committee. It is really 
managed from the top down.
    I didn't come here today to beat on you about what is in 
your budget or not in your budget, but rather talk about how we 
can work together to make the agency work more efficiently and 
be more customer-friendly and serve the people that it is 
intended to serve.
    If you would comment on those two things: technical 
assistance versus enforcement and top-down management versus 
bottom-up control, where you actually have more community 
input?
    Mr. Lyons. Let me first address the technical assistance 
versus enforcement issue, Congressman. I appreciate the 
opportunity to do that.
    I am sure you are aware that the agency's mission and 
legislative mandate has changed some over the last almost two 
decades, going back to the 1985 farm bill. New programs, 
placing new requirements on producers, were put in place, and 
then Soil Conservation Service was given the responsibility to 
implement those: programs like Conservation Compliance and 
Swampbuster and Sodbuster.
    That defined a new role for the Soil Conservation Service, 
and I dare say it made a lot of people uncomfortable; it made a 
lot of producers question whether they had a friend or an 
enforcer to deal with. We have tried to work our way through 
those issues over time and demonstrate that, through voluntary 
approaches to dealing with larger conservation issues, that we 
can, in fact, be both a friend to the farmer and help farmers 
meet their obligations to protect clean water and wildlife 
habitat, and the like.
    I think we have accomplished a great deal there, and I am 
sure there are still places where there is concern and question 
about NRCS' role in whether or not we are being as helpful to 
producers as we could be. We are doing everything we can to 
provide that in a user-friendly way. I think we have 
accomplished a great deal there.
    I guess your other questions with regard to top-down versus 
local initiative, we do a great deal of our work through local 
conservation districts. That is really where conservation hits 
the ground and that is where we develop a great deal of the 
priorities that we implement, working directly with those 
entities.
    We are making more and more effort to try to ensure that 
those locally-led efforts really drive how we set priorities, 
how we deliver programs to the ground. We established, 
actually, under the 1990 Farm Bill, updated in the 1996 Farm 
Bill, State technical committees that would help agencies at 
the State level pull together information, collaborate and 
coordinate to better deliver programs to meet priorities on a 
State-by-State level, and really try and move program delivery 
out to the State and local level. So we are striving to achieve 
that, and I think accomplishing a great deal in that regard.
    If there is a distinction that I would draw between the 
Soil Conservation Service of old and the NRCS of today, maybe 
it is not a fair distinction, but I would offer this 
observation: We are really placing a great deal of emphasis on 
conservation and trying to demonstrate NRCS' capacity to 
address clean water, wildlife, and offsite impacts of 
agriculture in a way that is not going to threaten the 
profitability and viability of farm operations. So, in many 
respects, we have stepped up to the plate more than we did 
perhaps in previous decades to try to tackle those issues and 
demonstrate that we can help landowners meet those obligations 
and achieve their conservation goals in that way.

                         fip release in florida

    Mr. Boyd. Well, thank you, Secretary Lyons. I just believe 
that most of the problem could be solved with a restructuring. 
I notice that one of the things that you did a year or so ago 
was the creation of the regional office, which you have already 
addressed, which may be a half-step in the right direction. If 
you move to a process where the decisions can be made at the 
local level within the guidelines that are established at USDA, 
then that works. It works for the FSA. And I want to expound 
further on that point, and I will turn to you, Mr. Reed, for 
this question, and just give you an example of what I am 
talking about.
    As it relates to the FIP program, we have all talked and 
heard a lot today about the expansion of--your 
responsibilities, and Mr. Bonilla has talked a little bit about 
you going out of the realm of where we thought we ought to be 
initially. I tend to agree with him, that we are trying to do 
too much with too little, and as a result, we don't do much 
with anything.
    But the FIP program is a good example. The FIP program used 
to be under the FSA, and now it is under, I guess, according to 
the 1996 law, you have authority for administering that.
    Let me just ask this question: The non-add on FIP money was 
released by USDA to the State NRCS in Florida on January the 
11th. Five-and-a-half weeks later, on February the 18th, was 
the first time an application was approved with money. Now, in 
Florida, I don't know if you know, but in north Florida, if you 
don't have trees planted in the ground by the 1st of March, you 
don't do it; you wait until next winter. So this is a kind of 
example--this is an example of the kind of thing I am talking 
about.
    Can you explain how we could improve our delivery system or 
comment on that, Mr. Reed?
    Mr. Reed. I can't explain it, and I don't know enough about 
the specifics to really respond intelligently, but I will 
follow up with Niles Glasgow, our State conservationist there, 
and get you a better answer than I can give you today.
    [The information follows:]
                          Release of FIP Funds
    The base funding you are referring to was released to Florida on 
January 11, 1999. Applications were accepted and prioritized starting 
in December 1998. The base allocation of funds was obligated and 
applications approved by February 19, 1999. These funds were available 
before the end of the planting season. Applications were accepted, 
however, not enough seedlings were available for planting in fiscal 
year 1999. Those remaining applications will be considered for planting 
in fiscal year 2000.

    Mr. Boyd. Okay. I want both of you to know, all of you to 
know, that this is an important agency to folks in agriculture, 
and there are many of us, many of our constituents that, like I 
said, wouldn't be farming if it wasn't for a technical 
assistance agency that could provide those kind of services to 
protect our resources. We recognize how important that is, and 
we want to work with you. That is going to be my role here, is 
try to make something that works better to serve the farmer and 
the consumer.
    Thank you.
    Mr. Skeen. Mr. Latham.

                           ag drainage wells

    Mr. Latham. Thank you, Mr. Chairman. Welcome to our guests 
here today.
    As you are well aware, in Iowa we have a real problem with 
the ag drainage wells and trying to cap those and protect the 
aquifer that we all drink out of, I drink water from one on my 
farm, and my family uses the water. We have a real concern 
about the pollution from the confinement feeding facilities 
that are in the area, manure going directly into the aquifer, 
obviously.
    It has come to my attention, as you are probably well 
aware, we have had problems for years trying to get permits and 
trying to solve the problem. Locally, everyone has worked very 
well together. They have been fighting for Federal agencies 
that all claim jurisdiction over farm wetlands. It is like 
pushing on a balloon: Push on one side and it comes out some 
other place, in another agency, or they change the rules, like 
you did.
    This last January, it has come to my attention that you 
doubled the requirement for mitigation acreage for prior 
converted lands in Iowa. Unfortunately, the change was 
announced and implemented retroactively. The Iowa Drainage 
District Association was attempting to meet a deadline to close 
an ag drainage well in Pocohontas County, and in their effort 
they had to submit mitigation plans by September, using what 
were the rules then. And the change in the rule, obviously, 
cost them a great deal of money and time, and forced them to 
have to alter their budget and delayed once again the permit 
that they have been trying to get for several years now to fix 
the potential environmental disaster there.
    Well, is it the policy of the NRCS to enforce new 
conservation rules, even though organizations or individuals 
have submitted the mitigation plans to your agency months 
earlier and prior to the alterations and using what were then 
acceptable conservation formulas?
    Mr. Reed. Mr. Latham, I am not prepared to respond to that, 
but I will look into it and get back to you with a specific 
answer to your question.
    Mr. Latham. I would ask, you don't know what the policy is?
    Mr. Reed. I don't know that I fully understand the question 
either.
    Mr. Latham. Well, NRCS retroactively changed the rules as 
far as mitigation, after the Iowa Drainage District had gone 
through tremendous expense and time and tried to get a permit 
now for about four years to stave off an environmental 
disaster. Which is going to pollute the Ogalaga Aquifer if we 
don't get something done sometime. We talked about this last 
year, and it continues to be a real thorn for a lot of people.
    Mr. Lyons. Congressman, let me just attempt to address this 
briefly. In that, I understand what happened was the Army Corps 
of Engineers decided that a 404 permit was required and had to 
be issued in order to take this action. So I don't believe that 
NRCS----
    Mr. Latham. Yes, you changed the rules in January 
retroactively.
    Mr. Lyons. Well, I am going to have to look into that, 
Congressman, because I don't know that we did, but I will 
certainly find out.
    Mr. Latham. Okay.
    [The information follows:]
                       Ag Drainage Wells in Iowa
    The Trustees of Drainage District 176 plan to close several 
drainage wells and connect the drainage project to a new underground 
tile system to protect ground water quality. NRCS has been working with 
the District since their initial proposal. However, after the Trustees 
of the Drainage District filed a request with the Corps of Engineers 
(Corps) to seek a determination of jurisdictional wetlands, the Corps 
determined that proposed action for this project would require a 404 
permit under the Clean Water Act.
    Since the Corps is the lead federal agency for determining 
mitigation requirements and ratios for this proposed project, NRCS has 
not been involved with specific mitigation decisions. However, NRCS in 
Iowa has been assisting the Trustees of Drainage District 176 and the 
farmers in the watershed with wetland functional assessments so that 
their mitigation plan will be acceptable for obtaining the 404 permit 
from the Corps.
    The Trustees of the Drainage District wanted to proceed so that the 
farmers in the watershed could continue to be in compliance with the 
wetland conservation provisions of the 1985 Food Security Act in order 
to maintain USDA program eligibility. The 1985 Food Security Act 
wetland conservation provisions provide that an exemption to program 
ineligibility may be granted if an action is authorized by a permit 
issued under section 404 of the Clean Water Act.
    NRCS has worked closely with Drainage District 176 and the local 
farmers to ensure that neither easements nor 404 permit conditions will 
be placed on agricultural lands by the Corps. To provide for this, NRCS 
did not assign any wetland value to areas that farmers may desire to 
install additional drainage or intensify cropping after the 404 permit 
is issued.
    In summary, the Corps established the specific wetland mitigation 
requirements and ratios for the drainage well closure project proposed 
by Drainage District 176, Pocohontas County, Iowa in order to issue a 
404 permit under the Clean Water Act. The 404 permit requirements will 
also satisfy wetland conservation provisions of the 1985 Food Security 
Act administered by USDA.

                       cwap and ag drainage wells

    Mr. Latham. Are these ag drainage wells--capping them and 
trying to solve this problem--any part of the President's Clean 
Water Action Plan?
    Mr. Lyons. In terms of dealing with the abandoned well 
sites?
    Mr. Latham. They are not abandoned. They are ag drainage 
wells.
    Mr. Lyons. They are ag drainage wells.
    Mr. Latham. Although we wish they were abandoned.
    Mr. Lyons. You know, I don't recall if we have a specific 
action item related to that, but certainly it is an issue that 
has been raised many times in Iowa. I believe resources are 
being allocated to attempt to address some of those concerns.
    I would have to give you some specific information on that, 
refer to some stuff from the Clean Water Action Plan, to try to 
give you a better answer on that. I can't point to a specific 
program we have geared toward that, Congressman.
    [The information follows:]

                  Capping of Ag Drainage Well in CWAP

    There is no specific action item in the Clearn Water Action 
Plan related to the capping of agriculture drainage wells.

                          afo responsibilities

    Mr. Latham. It would seem that that would be something that 
could be part of that--I mean, since we are talking about 
polluting an entire aquifer here, and that several hundred 
thousands of people drink out of it.
    Apparently, you have had some questions about the animal 
feeding operation strategy. I was just wondering, is the EPA 
expecting you to carry all the water on this, to do all the 
work on it? Or, are we going to have EPA folks out in the 
field, too? Who has responsibility?
    Mr. Lyons. Well, as far as the voluntary portions of the 
plan or the strategy go, and the development of comprehensive 
nutrient management plans, that would be a function that NRCS, 
conservation districts, and others would carry out.
    We are maintaining a clear distinction between any 
regulatory functions that might be implemented, which EPA would 
be responsible for, as opposed to those voluntary actions 
called for in the strategy, which NRCS would implement.
    Mr. Latham. The strategy is pretty arbitrary as to whether 
it is voluntary or mandatory, from my understanding in reading 
the proposal. I mean, you can arbitrarily make the 
determination.
    I just wondered, how much time--you have limited staff out 
there, and they are overworked as it is. If EPA has real 
concerns, you would think that they would carry some of the 
responsibility. On the other hand, I don't want EPA folks 
running around every farm in Iowa, either, but I don't think 
that is a good use of their time. But you don't know what their 
involvement is going to be in enforcement?
    Mr. Lyons. Well, they would certainly have responsibility 
for dealing with certain operators, larger operators, and the 
like, who fail to come into compliance. But, by and large, the 
strategy focuses on attempting to put in place, through these 
comprehensive nutrient management plans, practices that would 
minimize the impact of most operators on water quality. I think 
our estimates are that only 5 percent of all AFO's might come 
under a regulatory requirement through the strategy.
    Mr. Latham. Is an NRCS person and an EPA person going to be 
driving around together?
    Mr. Lyons. Not that I anticipate, no.
    Mr. Reed. No.
    Mr. Latham. So who is it going to be?
    Mr. Reed. The way things are planned right now--and, Mr. 
Latham, I know you know the answer to this question is the 
NRCS----
    Mr. Latham. Well, surprise me. [Laughter.]
    Mr. Reed [continuing]. With our conservation partners out 
in the countryside, we are expected to carry the load with 
respect to providing the technical assistance associated with 
implementing the Unified Animal Feeding Strategy.

                            debt for nature

    Mr. Latham. Okay. There is $5 million in the Debt for 
Nature program for producers with cashflow problems and land 
that needs conservation treatments. Are those cash-poor farmers 
going to have to follow the same, shall we say, unclear rules 
and somewhat convoluted rules under CRP, or what kind of rules 
are we going to follow to make land available? What 
requirements? How many hoops are they going to have to jump 
through, if they are broke anyway, to qualify?
    Mr. Reed. Well, on this one, the rules are yet to be 
defined.
    Mr. Latham. Oh.
    Mr. Reed. So we have an opportunity to avoid some of the 
pitfalls you just outlined.

                           agency priorities

    Mr. Latham. Okay. That would be very much appreciated.
    I guess I have some concern about priorities. There is $12 
million for studies and inventories for a baseline on soil 
carbon data and $3 million for carbon sequestration--easy for 
me to say. And I just wonder about priorities with the soil 
surveys, which are extraordinarily important and need to be 
done. I know there is a small increase as far as surveys are 
concerned. But I guess whichis a priority? This whole idea, I 
think--we are seeing in general, and if you followed any of the 
questioning and testimony here, just a tremendous diversion of 
resources from traditional agricultural research, from traditional farm 
programs, to export assistance, into the global warming/climate area. I 
just wondered, the survey part of it is extraordinarily important, and 
I would rather see the priority there. Do you have a priority? I mean, 
where did this come from? Is this your idea, Mr. Reed? [Laughter.]
    Mr. Reed. No, sir, it is not.
    Mr. Latham. Is it Mr. Lyons, then, apparently?
    Mr. Lyons. It must be my idea. [Laughter.]
    Mr. Latham. It must be.
    Mr. Lyons. I will respond to that, Congressman----
    Mr. Latham. Okay.
    Mr. Lyons [continuing]. Since you baited me so well.
    Mr. Latham. Okay.
    Mr. Lyons. You know----
    Mr. Latham. I don't mean to bait you.
    Mr. Lyons. No, you know what I mean.
    Mr. Latham. Yes.
    Mr. Lyons. No, I think, to be honest--and we discussed this 
a little bit before--these are small investments out of a total 
budget. If I had my way, we would put a lot more money into 
conservation and not in other areas in the Federal budget 
overall. We don't have that luxury. It is unfortunate that we 
have to scrape dollars together to make investments in what I 
think are some of the most critical issues--in fact, issues 
affecting national security this Nation has in conservation.
    These are small investments really intended to learn some 
things that, hopefully, can help us address some larger 
problems. The minimal investment in global climate change and 
soil sequestration, et cetera, is intended to address what many 
scholars believe is a global problem, and trying to understand 
how agricultural producers can attribute to addressing the 
problem, hopefully, in ways that are cost-effective for them. 
So I think that is the view that we would offer in terms of why 
those are in the budget.
    Mr. Latham. And you are well aware that, like in the CRP 
program, things like that, which there are--what?--about 5, 6 
million acres that should be in the program that are not, the 
soil mapping surveys are a very important part of that as far 
as preserving these very fragile soils. Obviously, we have been 
through various discussions as far as implementation of CRP, 
but why we would not put our priorities in things that we know 
work, and we have money and we have authority available to 
implement things that save real soil, conserve soil, and then 
go off and put money in other things that are unproven, is a 
little bit--I shouldn't say, ``a little bit''--it is very, very 
disturbing.
    Mr. Skeen. Will the gentleman yield?
    Mr. Latham. Yes, sir. It is time.
    Mr. Skeen. Ms. DeLauro has a time-crunch problem.
    Mr. Latham. And get one response and I am done, sir.
    Mr. Skeen. All right, sir. Thank you.
    Mr. Lyons. I will just respond very quickly, Mr. Chairman, 
and just say that, in many respects, you can equate those 
investments with kinds of research and development investments 
that the private sector would make. We are experimenting with 
new approaches to deal with what we think are some significant 
national and international issues.
    We are, however, placing priority on some significant 
additional investments in other conservation programs like 
EQIP, where we are asking for $300 million. That is a proven 
program that has a track record that demonstrates the value of 
technical assistance and cost-share assistance. That is where 
we would like to see our priorities set.
    Mr. Skeen. Thank you. We will come back to you.
    Ms. DeLauro.

                           section eleven cap

    Ms. DeLauro. Thank you very much, Mr. Chairman. I apologize 
to my colleague. I have to give a speech in about 12 minutes. 
So, I am going to submit most of my questions for the record, 
but I wanted to ask a couple of questions. And it is good to 
see you all here.
    Mr. Reed, let me congratulate the agency on its work 
through the CCC on conservation programs. Let me take a moment 
to talk about my district, which is the third district of 
Connecticut. We have CCC efforts like WHIP and CRP ongoing in 
Wallingford, North Branford, Hamden, and Orange. I understand 
that the cap that has been placed on reimbursements from the 
CCC for conservation programs that NRCS administers has created 
some difficulties within the agency's ability to provide 
technical assistance, in order to carry them out in Fiscal Year 
1999. Can you explain the problem and suggest how it can be 
addressed?
    Mr. Reed. Yes. The problem is a complex, but yet at the 
same time a simple one. Based on the amount of money that is 
available to fund the technical assistance work that is carried 
out by the NRCS for the Conservation Reserve Program, we 
estimate that we are at least $25 to $28 million short of what 
is needed in order to do what has to be done this year.
    Ms. DeLauro. This year?
    Mr. Reed. And I know that Secretary Lyons here is working 
with the Secretary and with our Budget Office developing 
options to deal with it. The options, as I understand it, range 
from determining whether or not the cap is really an issue or 
can it be resolved either through actions of the Secretary or 
legislatively, or whether or not a supplemental appropriations 
would be needed this year to help us through the situation. 
But, as of this moment, based on our best estimates, on or 
about the 15th of May, we will no longer--well, we will have 
earned all of the reimbursements that there are to be earned 
for the CRP program this year.
    Ms. DeLauro. What is your prognosis? Are we going to get 
some sort of resolve?
    Mr. Reed. I don't have a prognosis, but I have a prayer.
    Ms. DeLauro. Well, that is often more powerful. [Laughter.]
    Mr. Reed. But Mr. Lyons may want to weigh-in now and give 
his perspective on it.
    Ms. DeLauro. Mr. Lyons? What happens if Mr. Reed's prayer 
isn't answered?
    Mr. Lyons. We are in trouble. We are in trouble in terms of 
our ability to provide that technical assistance, and that is 
why the Secretary and I are working to try to reach resolution. 
We may address this in the emergency supplemental request or we 
may have to seek some other approach. We talked a little bit to 
the chairman and others about the need to deal with this. It is 
a clear problem we have to address.
    Ms. DeLauro. Quickly, if you are cutoff, what is the 
downside on that? I mean, what happens? No technical 
assistance; what happens? What is the state of play where is it 
needed?
    Mr. Reed. Well, two things: One is that, if we aren't able 
to provide the technical assistance, then the farmers hurt.
    Ms. DeLauro. Okay.
    Mr. Reed. Secondly, as a part of options to deal with the 
funding shortfall problem, I am developing options to advance 
to Mr. Lyons to furlough our people. So those are two.
    Ms. DeLauro. Okay. Well, you will keep in touch with us on 
what is happening?
    Mr. Reed. Through my Under Secretary.

                           workload analysis

    Ms. DeLauro. Yes, you will? Okay.
    The second question, NRCS is reportedly finalizing the 
results of a conservation workload analysis that looks at the 
gap between technical assistance resources needed at the field 
level to carry out the basic conservation mission, as well as 
initiatives such as the Clean Water Action Plan and the recent 
animal feeding operations strategy, and the amount of resources 
available to actually get conservation practices applied on the 
Nation's private lands. It looks like the gap is around $300 
million. Is this accurate?
    Mr. Reed. Let me tell you what that is.
    Ms. DeLauro. Yes.
    Mr. Reed. I mentioned earlier that virtually everything 
that we do is done in partnership with local conservation 
districts and State conservation agencies. To satisfy some of 
the accountability issues, we have developed, as a part of our 
new accountability system, a workload analysis, and we are 
calling it a partnership workload analysis. As we work that 
thing from the bottom-up, we determine how much money is 
appropriate in terms of the investment for the infrastructure 
out in the countryside from the USDA, as well as from the 
partners. Based on that workload analysis and the core work 
products associated with that, that figure would come out to be 
approximately $300 million. That is what we have worked with 
the conservation partnership on.
    That is focused primarily on making sure that we have 
captured in the system at the local level the minimum 
infrastructure that is needed, so that we can provide the 
appropriate technical assistance to farmers and ranchers and 
others.
    Ms. DeLauro. Okay. Thank you very much. Thank you, Mr. 
Chairman.
    Mr. Skeen. Thank you, Ms. DeLauro.
    Mr. Nethercutt.
    Mr. Nethercutt. Thank you, Mr. Chairman.

                         land legacy initiative

    Gentleman and ladies, welcome. I am sorry that I have been 
delayed. I had another hearing, and it is the story of our 
lives, I think.
    Mr. Lyons, I want to ask you, sir, the administration has 
proposed a $1 billion Land Legacy Program to acquire new land. 
I am familiar with the Conservation Reserve Program, as you 
are, and the Wetlands Reserve Program. I am wondering why these 
programs weren't considered for expansion as part of the Land 
Legacy proposal. Would you explain to the committee the 
thinking behind that?
    Mr. Lyons. Certainly, Mr. Nethercutt. The Land Legacy 
Program would be funded from OCS lease revenues, Outer 
Continental Shelf lease revenues. Approximately $900 million 
would come out of the Land and Water Conservation Fund.
    As you know, CCC provides the funding base for CRP and WRP. 
So I think that is the distinction that is drawn there.
    Mr. Nethercutt. Well, the latter two are good programs, and 
it seems to me, what do we have, 36-some-odd million acres in 
CRP? In terms of conservation and preservation and management, 
it seems to me that those are good models, it seems to me, for 
conservation legacies.
    I appreciate Ms. DeLauro's comments about CRP. Chief Reed, 
it has been very important in our district to have a good CRP 
program finally, and thanks for getting that all worked out 
relative to the 16th signup.
    Leonard Jordan has been out in our district and has 
jurisdiction, and has really done a nice job. I want to pass 
that onto you publicly as well as privately. He has worked very 
hard to run a good shop and deal with farmers and try to have 
good communications.

                        eqip listening sessions

    I know that there was a series of listening sessions that 
went on relative to the Environmental Quality Incentives 
Program, the EQIP program. I am wondering what you all can 
report as to what was heard from farmers and ranchers relative 
to EQIP? And whatever you learned, I am wondering what you do 
with it. How do you implement whatever recommendations you 
might have gotten?
    Mr. Reed. What I would like to do, Mr. Nethercutt, is to 
provide you with a copy of the summary report from that round 
of listening sessions.
    [The information follows:]


[Pages 75-77 -- The official Committee Record contains additional 
    material here]


    Mr. Reed. I have three or four things I would like to share 
with you today.
    One is that we were told that we need to try and make the 
EQIP program more locally-friendly. Another one was centered 
around the need to address the problem with EQIP in that it is 
a technical problem, in that funds that are obligated in the 
current year, if those contracts fall out in outyears, then 
that money goes back to the Treasury and is not available to do 
conservation work. So that is another one.
    And the third and last thing I will mention was a budget-
type issue, and that is that there is just not enough EQIP 
dollars available to satisfy the needs. So, as we get into the 
priority-setting, naturally, there is a large, large segment of 
our customer base that is left out.

                             wetland policy

    Mr. Nethercutt. Along that line, I am wondering with regard 
to the problems relative to wetlands policy and Federal 
agencies, what do you perceive to be the problems with regard 
to wetland policy? What is NRCS going to do relative to looking 
at all those lands and reviewing policy and determining what is 
what? Can you help the committee understand a little more what 
the intentions are and what the problems are that you face 
relative to consideration of wetlands policy?
    Mr. Reed. Well, I have talked to some of yourcolleagues 
over on the House Agriculture Committee and elsewhere, and they have 
told me--and I agree--that it is probably appropriate for the Congress 
to have some oversight-type activities, so that we can get some of 
these issues on the table, so that they can be scrutinized. I think, 
from that process, we will be better able to, in an objective way, deal 
with the issues you mention, plus similar-type issues that are tough 
for us.
    I need to let you know that one of the toughest things that 
I am dealing with right now is the conflicting messages that 
our own people get out on the countryside, not necessarily from 
NRCS, but from all of the folks we have to work with inside and 
outside of USDA on what is right, what is doable.
    So I would come back and say we need some help from you on 
this one.

                   conservation reserve program cover

    Mr. Nethercutt. I understand, and we wish we all had more 
money and a perfect world. That is the hard part for us, to try 
to deal with limited resources, but lots of need out there, 
especially as it relates to agriculture.
    In the 16th signup and the 15th signup in CRP, issues have 
been raised--and maybe this isn't specifically within your 
jurisdiction; maybe you have some thoughts--about the rules and 
regulations that have been implemented regarding cover, kinds 
of cover, the cost of seed, the cost of cover, relative to what 
is existing today or prior to the 16th signup.
    Can you update the committee on relative to those 
conflicts, those problems that came up in the signups that have 
occurred, but, are yet to be fully implemented by the farmer, 
that cost-and-bid relationship problem?
    Mr. Reed. Mr. Nethercutt, I am just simply not prepared to 
deal with that one today.
    Mr. Nethercutt. Okay. That is all right. We have dealt with 
it out our way, and there is some uncertainty relative to the 
availability of the kinds of cover that are needed. If it is 
convenient for you, if you could maybe provide something for 
the record, that would be very helpful.
    [The information follows:]
                      Conservation Reserve Program
    The National Resources Conservation Service (NRCS) understands that 
certain cover existing on expired and expiring contracts may provide 
some benefits to wildlife. However, according to wildlife experts with 
the U.S. Fish and Wildlife Service and public and private environmental 
and wildlife agencies, covers of monoculture grasses do not provide the 
level of wildlife and wildlife habitat benefits that can be achieved 
from a mixture of grasses (including forbs and legumes) native to the 
area. Consequently, acreage planted to one type of grass is not as 
likely to be accepted as acreage that will be devoted to a cover with a 
mixture of grass providing greater diversity and wildlife habitat.
    Seeding mixtures developed by NRCS for CRP are reviewed and 
approved by State Technical Committees. In addition, USDA has provided 
producer flexibility in the establishment of enhanced cover. Producers 
may take up to two years to establish their enhanced cover where the 
recommended grass seed is unavailable or where seed costs will create 
an adverse economic hardship on the producer. Native forbs and legumes 
may be substituted with introduced species that will achieve the same 
wildlife or conservation purpose. Also, approved methods of 
establishing enhanced covers such as interseeding, planting in strips, 
or planting a little over half of a CRP field to the prescribed cover 
will not require the complete destruction of the present cover in most 
cases while controlling soil erosion.

    Mr. Nethercutt. I just want you all to know that there is 
that problem for the farmer versus the bid that was proffered, 
and then the consequent cost of meeting the needs, the rules 
and regulations for providing cover and making sure the CRP 
program is right.
    I think after-discovery determinations have been tough on 
farmers, and they are trying to figure out what the 
requirements and rule and regs are. It is not easy. So I would 
thank you for any response you could provide.
    Thank you, Mr. Chairman.
    Mr. Skeen. Ms. Kaptur.
    Ms. Kaptur. Thank you, Mr. Chairman.
    I wanted to ask a few questions. I will submit others for 
the record.

                        learning more about nrcs

    Ms. Kaptur. Mr. Farr pursued an interesting line of 
questioning for me, and that relates to how well the 
information you produce is able to be used by State and local 
officials. I know, from my own experience many years ago, the 
opinion of local zoning and subdivision officials was that 
agricultural land is a residual. It is only there unless you 
can use the land for something else. Therefore, it was not 
zoned; it was not regarded highly as a national resource or an 
international resource.
    Even though the Soil Conservation Service in those days 
went around doing some mapping in the countryside, the 
influence of that over local land decisions and State land 
decisions I would say was very minimal. I have struggled with 
this for years in my own mind, as to what is proper to do 
regarding that.
    We did change some subdivision regulations back in our home 
State to give agriculture its own primacy, its own place within 
those laws, as a very important natural resource, in the same 
way as we might specially map the Great Lakes as freshwater 
resources that we had a special responsibility for. We never 
really did that in Ohio, I am only speaking of now, and I doubt 
other States did, either, from what Mr. Farr said today.
    I guess one of the questions I have of you, Mr. Lyons and 
Mr. Reed, if I look at the very detailed budgetsubmission that 
was submitted here today, on pages 17-21, you talk about a request for 
geospatial data, trying to present information in a different way. I 
would ask you the question, based on the information you have available 
to you now before this request, if I were to say to you, do you have 
the ability within USDA to come up to us, before this committee, let's 
say, and have a series of transparencies that would be superimposed 
over one another that would tell us the story of what your division of 
USDA has done over the years, that would show the prime lands, the most 
productive lands, the soils that are truly in the national interest, 
where those would be located? And you would overlay various other 
important features that would be important for this committee to know 
about.
    For example, wildlife habitat, we have been talking about 
some of those programs. Mr. Nethercutt was talking about the 
enrollments in the Conservation Reserve Program. There are many 
other--some States have instituted farmland protection 
programs. Mr. Boyd talked about the Forestry Incentive Program.
    Is there a way of you, in a more visual and meaningful way 
to this committee, helping us to understand the full range of 
programs that you administer, and how those impact on our 
natural resource base? I think it is really hard, especially 
for the new members, and certainly for returning members like 
myself, to really grasp the enormity of what your Department is 
being asked to do.
    I think part of that difficulty stems from the fact that we 
are presented with a lot of words and budget numbers, but some 
of the mapping that could be essential to our understanding is 
not submitted along with the budget. Is that impossible for you 
to do today?
    Mr. Lyons. Today ``today,'' yes. But we could clearly 
provide you with those overlays that show where we are applying 
CRP, those farms where EQIP is being used as a conservation 
tool, critical wildlife habitat, areas of water quality 
concern, et cetera. We have that capacity, and we certainly 
could spell that out.
    [The information follows:]

    NRCS is developing a briefing presentation under advisement of the 
Ranking Member. The information is in electronic/multi-media form, not 
for print. It will be presented to the Subcommittee at the earliest 
agreeable date.

    Mr. Lyons. You raise a very interesting point, though, Ms. 
Kaptur, and this is, I think, kind of the nexus for us, the 
next challenge in terms of how we apply conservation on the 
landscape. I just throw this out for you to think about.
    We constantly struggle as an agency--I think all agencies 
do this--in implementing programs. We have CRP signup one day, 
and then we will have WRP signup the next day, et cetera, et 
cetera. I think our real challenge is to apply conservation 
across the landscape and to use those tools to the maximum 
efficiency to achieve the conservation goals that we have.
    We are starting to experiment with that now--for example, 
continuous signup of CRP for buffer strips, to protect those 
critically-important riparian areas which are important, high 
value for wildlife habitat, important or water quality, et 
cetera; trying to use the EQIP program and target it to high-
priority landscapes where there is sensitive soils, 
environmentally-sensitive resources that we need to address. We 
are using the State technical committees to do that.
    We have the capacity to begin to lay that picture out for 
you, and if it would be helpful, we would be glad to come up 
and brief you on how we would provide conservation services on 
the landscape, whether it is the landscape in Ohio or in New 
Mexico, and what role we play in trying to achieve goals, not 
only related to conservation, as maybe the public thinks about, 
but to preserving clean water, to improving forage production, 
to maintaining or promoting timber supply, et cetera, all of 
those things that fall under our purview.
    In fact, I would argue that is the great conservation 
challenge of the next century. Most of the investment we make--
and I know you know this because you have to deal with 
allocations between subcommittees--still are in public lands. 
We continue to invest a tremendous amount of money and time and 
energy and anguish over public land debates, which, of course, 
the Chairman gets to do over in his Interior Subcommittee. Yet, 
two-thirds of the American landscape is privately-owned. Most 
of the water that falls, most of the rainfall that runs through 
those watersheds runs through private land. Yet, we really 
invest a very, very small amount of money in the conservation 
and stewardship of that important element of landscape.
    I think if we laid that out for you, you could see how 
critical that investment is and, of course, how critical your 
decisions are to assuring good conservation across that 
landscape.
    Ms. Kaptur. I would just ask the chairman's indulgence on 
this, and some of the staff. I personally, and I think several 
of our members on our side here, would be veryinterested in 
learning more about each others' regions of the country. Rather than 
just traveling to people's districts, I think it could be very helpful 
if there were a way of you going back and thinking about how to help us 
educate ourselves about the different experiences we have in our 
regions of the country.
    I can tell you, in traveling to our esteemed Chairman's 
region of the country, when we flew over the Colorado River and 
I looked at some of the irrigated patches, that was such a 
weird experience to me, coming from our part of the country. I 
thought, you know, I shouldn't have had to travel--but then 
there are these issues with Mr. Farr with snowfall over in 
Colorado, and does the water drain over into his part of the 
country?
    You know, I really think that that kind of generalized 
briefing could be extremely interesting for us and help for us 
to understand, also, the interrelationship of programs. Now 
this may happen over on the authorizing committee; I don't 
know. But I would just say to the chairman, maybe not during 
this budget cycle, but maybe after we get through this bill, to 
have that kind of informational session for our members I think 
would be extremely interesting. If you are able to do it--I 
didn't know whether you were, and whether your program officers 
even talked to one another over there at USDA. With the number 
of programs we get thrown at us, sometimes we wonder.
    But I would make that request, and just ask if maybe the 
committee might not be willing to consider it at some point 
this year? Members like to learn. I ask myself, as I look at 
page 17-25, which deals with your conservation operations, and 
I look at Mississippi--and I don't mean just to pick on 
Mississippi, but, my goodness, why does Mississippi have 298 
staff-years? Why doesn't Mississippi--what does it have 
compared to California----
    Mr. Skeen. Probably a chairman. [Laughter.]
    Ms. Kaptur [continuing]. 173 years? I am thinking, well, 
maybe it's the river drains down there, you know; we have got 
watershed problems.
    But I do ask myself. So you look at the way in which we 
spend our dollars. My goodness, I have served in the Congress--
this is the beginning of my 17th year, Mr. Chairman. Sometimes 
I don't necessarily understand the relationship of these 
numbers. I look at the watershed and flood prevention 
operations on page 17-38, and I look at Ohio. I mean, gee, why 
does Ohio--I am glad we get all that, but why? And here my 
district is flooded. So what is going on there? Why don't we 
qualify for a couple of the watershed operation program up in 
our corner of the State?
    I think if we could have that kind of briefing down the 
road, it could be very, very helpful. So I just wanted to put 
that on the record. So that is not so much in the way of a 
question, but a request.
    Mr. Lyons. We welcome that request, Ms. Kaptur, and we 
would love to do it before you finish this bill, as opposed to 
after you finish the bill.
    Ms. Kaptur. I will leave that to the discretion of the 
Chairman. We have a lot of new members on our side of the 
aisle, and I just think it would be awfully interesting.
    Mr. Skeen. Well, we will take--Mr. Farr? I agree with you. 
I agree; I think with the technology that you have today, that 
you are capable of doing this thing, and we can discuss that.
    Mr. Farr, if he would like to ask another question.
    Mr. Farr. Well, I am sorry I missed part of it. I really 
enjoy this discussion. Perhaps I have been a little 
philosophical in wanting to--but I think you ought to take the 
look at how you can work yourselves out of a job. If, indeed, 
you are going to teach land use management practices, then you 
ought to get them incorporated. That idea, the concept of a 
building code I think is absolutely essential.
    You know what the best management practices are. When I 
talk to farmers who say, ``You know, the problem with dealing 
with government is that there are too many of them out 
there''--it is not that there is too much government; there are 
too many governments, too many governmental organizations. We 
can't just go to one and say, okay, we are going to do all of 
these things you suggest, and that is all we have to deal with, 
because along comes the State and says, well, we knew nothing 
about that; we are not working in conjunction with that, and we 
have our own other issues. Then along comes the county--in 
California, counties are very powerful, and they are 
sophisticated. They have money, and they will hire the 
professionals who may even work for you. They come along with 
their thing. So these poor farmers are saying, ``Which 
government do we have to work with, because we get a different 
message from each one of them?''
    What we have tried to do in our area--and I applaud you for 
it; it has been some of your staff, and they ought to get the 
highest award in America for it. Because I went to my farmers 
on this watershed issue, wetlands issue. They had a roomful of 
people like this, and the farmers, essentially, said--and there 
was probably as many people working for government as there is 
in this room, working for all these different agencies--and the 
farmers said, ``Okay, which one of the people in this room do I 
deal with?'' I asked the question, ``Which one is it?'' And 
about five of them raised their hands, and they were all from 
different levels government.
    They said, ``Well, we can't deal with that. We can't make 
any commitment.''
    So we said, ``Okay, Governmental Folk, you get on the same 
page.'' I thought they would take a month. It took them two-
and-a-half years. We got a single-stop, thanks to an employee 
of yours, one-stop shopping.
    The Coastal Commission buys it--all of the regulatory and 
planning, county planning departments, all of them. And do you 
know what they do? They go out with the farmer right now and 
they work with each farmer and they say, ``This is what we 
think you ought to do,'' and the farmer says, ``Fine. I'll do 
it with my own money, my own time. That is all I wanted to 
know. Thank you very much. I appreciate all your professional 
help. Come back in, monitor me, and tell me what I am doing 
right.'' And it is working.
    I don't know why we can't start doing that. We spend all of 
this money and all of this time, and, yet, we haven't gotten it 
infused. I mean, if this were your children, they would still 
be in the first grade, and you would wonder, at 16, they would 
look a little awkward there.
    So I want to see if we can start moving all of these 
programs. I have been working on a watershed survey for five-
and-a-half years here. I have been talking to the wrong people. 
I didn't know you did that. I thought the Corps of Engineers 
did it.
    So there are things here that you really do, and I would 
like to try to get some more of one-stop, one-page. I thinkif 
we do that, government is better served. The criticisms that you get 
from people who think that the best way to solve the problem is just 
sort of put a meat axe to it, just cut government--if you cut it, it 
ought to get better, because there is too much of it. I don't think 
that is the way to do it. I think you finetune it and make it work 
better.
    You are in a position where so much of the land in this 
country is dependent upon whether we in the next couple of 
years learn how to make that land maximize its production 
ability and minimize the adverse impacts of that production, 
through minimizing pesticide use, runoff, erosion, and so on. I 
can't think of an agency in America that will have more impact 
on the future of our country, and how it will look and how it 
will produce, than the people sitting at this hearing and your 
successors.
    So I am very excited about working with you. I would urge 
that you think about ways to get the best management practices 
together with local and State government, get to the one-step, 
and then get the local governments to buy it in. The people 
will push them to do it, because they will be so glad that they 
only have to work with one government.
    And I will support you. I just encourage you to think that 
way, think outside the Federal box.
    Thank you, Mr. Chairman.
    Mr. Skeen. Thank you.
    Folks, I think it is about time to wrap it up, but I want 
to tell you this: how much we appreciate you, what you do. As 
one who practiced in this field at one time and understands 
why, some of the reasons why, you do the way you do today--
because for a long time it was a matter of bringing technology 
into the fields, but the persons who either graduated from the 
universities, or whatever, in those particular fields today 
that technology has gone way beyond that. We relied on it a 
great deal, and it is not as person-oriented as it is a 
technological orientation. You folks, I think, are responding 
to that.
    I think Ms. Kaptur has an excellent idea. I think, with the 
technology we do have today, that you can make comparisons. I 
think that we ought to educate this group, because those of us 
who come from the soil production area, making a living with 
it, into this place that we call the country's legislative 
body, we spend a lot of our time explaining what we do. And 
they ask, ``Have you ever been a farmer or a ranch operator?'' 
Very few of those folks come to Washington. The East doesn't 
know what the West is doing, and the West doesn't know what the 
East is doing. I think that we have an opportunity to educate 
at least this group of folks over here. Sometimes I think we 
are uneducatable, but we will try. I think it is a good 
request, Marcy. I think it makes a lot of good sense.
    You folks who would know how to put it together, we would 
like to get some response from you.
    We want to thank you for what you do, how well you do it, 
and those people who back you up in the back there. We have 
spent two-and-a-half or three hours on this stuff today. There 
is an avid interest in what you are doing, and we know we are 
supposed to put the dollars to it, but that is not the end of 
the game. What kind of results do you get?
    Mr. Lyons. That is right.
    Mr. Skeen. Well, thank you for all that you do.
    If we have any other questions, we will submit them.
    Mr. Skeen. We are adjourned.
    [The following questions were submitted to be answered for 
the Record:]


[Pages 85-358 -- The official Committee Record contains additional 
    material here]

                                          Wednesday, March 3, 1999.

                   MARKETING AND REGULATORY PROGRAMS

                               WITNESSES

MICHAEL V. DUNN, UNDER SECRETARY, MARKETING AND REGULATORY PROGRAMS
CRAIG A. REED, ADMINISTRATOR, ANIMAL AND PLANT HEALTH INSPECTION 
    SERVICE
ENRIQUE FIGUEROA, ADMINISTRATOR, AGRICULTURAL MARKETING SERVICE
JAMES R. BAKER, ADMINISTRATOR, GRAIN INSPECTION, PACKERS AND STOCKYARDS 
    ADMINISTRATION
STEPHEN B. DEWHURST, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE
    Mr. Skeen. I want to say good afternoon, and today we have 
with us the Marketing and Regulatory Programs of the Department 
of Agriculture, and Under Secretary Dunn--and that does sound 
better than Assistant Secretary, does it not?
    Mr. Dunn. Thank you very much for your assistance, Mr. 
Chairman, on that.
    Mr. Skeen. You have done yourself proud.
    We are leaving it up to you to present a brief opening 
statement, and I would ask that Mr. Reed, the APHIS 
administrator, Dr. Figueroa, the administrator of AMS, and 
GIPSA administrator, Mr. Baker, will follow your lead.
    Your prepared statements will be printed in full for the 
record. Now it is all yours, if you will introduce your group, 
and we will launch this little boat.
    Mr. Dunn. Thank you very much, Mr. Chairman.
    Mr. Skeen. Thank you, sir.

                       Introduction of Witnesses

    Mr. Dunn. Today, I have with me Mr. Baker, the 
administrator, Grain Inspection, Packers and Stockyards, Dr. 
Figueroa, who is the administrator of Ag Marketing Service, and 
Dr. Reed, who is the administrator of Animal Plant Health 
Inspection Services, and Mr. Steve Dewhurst, who is director of 
the OBP&A for the United States Department of Agriculture.

                           Opening Statement

    Mr. Chairman, I will give a brief oral statement, with my 
written testimony being submitted as part of the record.
    Mr. Skeen. Thank you.
    Mr. Dunn. Thank you, sir.
    I think it comes as no surprise to folks that the 
Department has been under so much stress this year because our 
producers have been under stress. The farmers and ranchers, the 
folks that we all work for, your constituencies have been under 
stress. This has been a very, very tough year for us as we look 
at the outlook for what may happen in the future, and it is 
especially important for Marketing and Regulatory Programs.
    With the advent of the 1996 Farm Bill, we see more and more 
of the responsibilities for marketing to come under the 
Marketing and Regulatory Programs' umbrella. Certainly, Mr. 
Chairman, these agencies need to be able to respond to the 
conditions of the future.
    We had devastating news for pork producers this year. In 
December, we reached an all-time low, about 8 cents per pound 
for pork producers. This translates into real agony for the men 
and women that are involved in agriculture out in the 
countryside, your constituents, our constituents.
    In Marketing and Regulatory Programs, we looked to see what 
could we do to assist these pork producers. Under Ag Marketing 
Services, the one thing we could do is purchase additional pork 
products to get into the school lunch program, to get into 
nutrition programs. What we did, Mr. Chairman, is we reached 
our legislative cap that we could have for pork purchases. 
Under the law, we can go to 25 percent of Section 32 for any 
single commodity. We did that for the pork producers.
    More importantly, when we did that, we told the packers 
what we wanted them to do was to have a part of that portion to 
come from overtime work, kills that were going on over the 
weekend and on second shifts. Because what we were told by pork 
producers, that the kill capacities just simply was not out 
there to take care of the demand that they had for pork 
slaughter.
    In GIPSA, we went in to look at what transpires out there 
in the marketplace, and we had a study in 1996. And what we 
found in that study was that primarily smaller pork producers, 
those that market less, did not realize higher prices that some 
of the other contract larger producers might get. And we took 
that information to Ag Marketing Service and asked them to take 
a look at that and to report what is actually happening out 
there in the marketplace so producers have a better 
understanding of what the price for pork might be. In the 
beginning of this year, they did change how they reported pork 
prices out there.
    But, Mr. Chairman, probably the most help that we could for 
family farmers at this time was really through Animal and Plant 
Health Inspection Services. What we did there was go to an 
emergency situation using $80 million from CCC monies and began 
an indemnification program to eradicate pseudorabies. This was 
a win-win situation for us.
    What we were able to do was take approximately 1.17 to 1.9 
million head of pork out of production, sending it to slaughter 
to rendering plants, indemnify the producers for that, and thus 
free up this kill capacity of the slaughter plants. That is the 
way that we see Marketing and Regulatory Programs needing to 
operate in the future to respond to these types of situations 
that we have in the marketplace.

                         fy 2000 budget request

    Well, let me get down to business, Mr. Chairman, on what we 
are asking for in our funding request. We are proposing $825 
million of program activities. Under current law, taxpayers 
would fund $458 million, and beneficiaries of service will pay 
$367 million. Marketing and Regulatory Programs administer over 
50 percent of the Department user fee programs at the present 
time.
    Under Grain Inspection, Packers and Stockyards, Mr. 
Chairman, at these times when producers are getting low prices, 
they come to us and they say is there something going on out 
there? Is the marketplace being constricted because of 
monopolies out there? What is going on? And they are asking us 
to take a hard look at what is going on out there and give them 
information about what is taking place.
    So what we are proposing to do is to enhance our monitoring 
and analysis of packer competition in the industry structure.
    Second, we are looking at broadening the size and scope of 
the poultry compliance investigation. The Baltimore paper has 
just finished up a series of reports about what can be done to 
assist poultry operators out there.
    Mr. Chairman, we desperately need those additional funds 
that we requested to give us the research and personnel needs 
and probably some more teeth in Packers and Stockyards 
legislation to be able to do something to assist these 
producers out there.
    We need to establish an electronic filing procedure, a 
method in which we can get rapidly, almost on a real-time 
basis, the information of what is going on out there in the 
packing industry so that we can analyze that to see if there is 
any funny business going on. That electronic filing system 
would be the single best factor that we could have to give us a 
better understanding of what is happening in the packing 
industry.
    And we need to identify the emerging grain-testing 
techniques and to develop analytical techniques for identifying 
generic differences in grain varieties. We are going to be 
seeing greater and greater requests for identity preserved on 
grains, and we need to develop an automated procedure for 
testing for mycotoxins, all of that under Grain Inspection, 
Packers and Stockyards.
    Under Ag Marketing Service, we are currently finishing up 
with our milk marketing order reforms. As this committee has 
asked us to do, we will publish that by the 4th of April, but 
it will not be implemented until the end of October. What we 
will try to do, Mr. Chairman, is ensure that we publish those 
milk marketing order reforms before you go on spring break that 
will give us an opportunity to come up and brief you and your 
staff, so that when you go back out to the countryside, you 
will not be caught off-guard and having us do it on the 4th of 
April, for instance.
    Another major area that Ag Marketing Service is working on 
is putting together the organic standards. We should have those 
out this year. It has been a major undertaking by the 
Department to be able to put that together.
    The AMS is putting a high priority on the demands of 
meeting the pesticide residue data that is needed for EPA to 
implement the Food Quality Protection Act. For 2000, a rapid 
response capability will be established that will enable EPA to 
complete risk assessments, evaluation of pesticides affecting 
multiple commodities in a more timely fashion. AMS will modify 
existing methodologies to test meat, poultry, eggs and drinking 
water for pesticide residue.
    Export markets are of tremendous concern to our producers 
out there, and they are asking us to give them more 
information. If they are to be in a global marketplace, they 
need to know what is happening in that global marketplace. So 
for greater demand for that market news, AMS is proposing to 
incorporate reports from major export markets into the existing 
market news and information. We will also be establishing a 
market news and information for organic crops, which is really, 
we see, as a major thrust of assisting small, family-size farm 
operations that primarily are in the organic industry at this 
time.
    We will identify alternative marketing strategies for small 
and medium farmers as well and disseminate that information in 
a series of meetings across the Nation.
    And, finally, Mr. Chairman, for Animal and Plant Health 
Inspection Services, APHIS has a 2000 budget request of $10 
million above the level appropriated for 1999, but we have made 
significant changes in what our priorities are for APHIS.
    The increased budget priorities involve $14.2 million for 
the detection and exclusion of pest and disease, $6.3 million 
for more timely and accurate surveillance information on plant 
and animals, including funds for emergency preparedness against 
acts of bio-terrorism, $3.8 million for emerging plant pest and 
invasive species, and $2.6 million for data gathering and risk 
analysis.
    Mr. Chairman, it is important, if we are going to be in a 
global marketplace, if family farmers are reliant upon that 
export market, and some of the reasons why we are in a 
situation today of low prices is because of our precipitive 
drop in our export marketplace. APHIS needs to take the lead to 
reduce those sanitary-phytosanitary barriers that are out there 
to open up those marketplaces for us.
    Simultaneously, the greatest threat that we have is for 
those foreign pest and disease to come into this United States. 
Classic swine fever, which we know is right off our shores on 
the Hispaniola Island could come in and continue to devastate 
the pork markets that we have here in the United States today. 
So we have to have that type of vigilance, as well as opening 
up those marketplaces.
    We recently have found a new invasive species that is 
coming in, something called the long-horned beetle, Asian long-
horned beetle. And in New York and Chicago, this beetle is 
wreaking havoc with our hardwood trees. We are losing maple 
trees. We are going into the City of Chicago and the City of 
New York, and we are cutting down trees because it is the only 
way we know how to get rid of these invasive insects at this 
time.
    We must, Mr. Chairman, ensure that we protect our shores 
from these. I am very proud of what APHIS did. In a short span 
of 32 days, they promulgated regulations to exclude solid wood 
packing material from China, which was the origin of this 
beetle. And we have over 70-percent compliance at this time 
from China sending goods into the United States.
    Mr. Chairman, with that, I will conclude and open it for 
questions or to hear from the administrators.
    [The prepared statements and biographies of Michael Dunn, 
Enrique E. Figuerora, Craig A. Reed, and James R. Baker 
follow:]


[Pages 364-453 -- The official Committee Record contains additional 
    material here]

    Mr. Skeen. Thank you, Mr. Dunn. Let us hope that they do 
not make the beetle an endangered species. [Laughter.]
    We have got enough of those.
    Mr. Dunn. We would like to eliminate it in the United 
States.

                           WILDLIFE SERVICES

    Mr. Skeen. Hopefully. Your testimony and that of Dr. Reed 
make a good case for the importance of Wildlife Services' 
programs, and I agree.
    Last year, we defeated a floor amendment to cut the budget, 
and now you are proposing to cut both operations and methods 
development. Why is this?
    Dr. Reed. Mr. Chairman, the proposed cut in Wildlife 
Services is serious and relates to priorities. Both within the 
Agency and at the Department, there are more demands for 
services than available resources. We have a list of services 
that we need to be providing, and we are running out of money 
in Wisconsin and Minnesota for wolf control.
    The people in Wildlife Services are doing a wonderful job 
keeping up with service demands in the face of additional 
costs.
    Mr. Skeen. Well, how does it reflect back on the operation 
itself?
    Dr. Reed. I can give you some basic figures.
    Mr. Skeen. We can have those inserted in the record, if you 
would like.
    Mr. Reed. Yes, we will do that.
    [The information follows:]

    Our budget requests a $1.8 million reduction for operations 
and asks that cooperators assume a larger share of program 
costs.

    Mr. Skeen. Last year at your request we added some 
additional money to APHIS for aviation safety. What is the 
status of that program, and what are your plans for the next 
fiscal year?
    Dr. Reed. Last year, as you know, Mr. Chairman, we had some 
serious problems with air safety. We had some----
    Mr. Skeen. Birds around airfields.
    Mr. Reed. We had some bird strikes around airports. There 
is always room for doing additional work there. We are working 
with major airports in this area to make sure that the flights 
out have a wildlife biologist on site at both National and 
Dulles Airports.
    So we are using that money to make sure that we control 
geese and other birds that will be giving a problem to the jet 
traffic in and out of the area.
    [Subsequent to the hearing the following information was 
provided:]

    With regard to the accidents I mentioned and the $1.2 
million provided in 1999, APHIS has embarked on a multi-year 
process of upgrading aircraft, flight crew training, air 
worthiness safety and certification to comply with the 
recommendations of the aerial safety review.

    Mr. Skeen. That is going to be an ingenious effort. For 
doing as much flying as we do around here, we surely do not 
need them going through engines.
    Mr. Dunn. Mr. Chairman, last year I called a moratorium on 
Wildlife Services from using aircraft because of exceedingly 
high accident rates and concern over the safety of our Wildlife 
Services employees in the aircraft.
    We did a complete review of that. We were able to get 
people back up in the air in certain types of aircraft. I am 
happy to say we now have one full-time safety officer in 
Wildlife Services and will have a second one soon. We are 
making great strides in improving the safety of our employees 
to be able to perform their mission.
    Mr. Skeen. A nonaviation exercise?
    Mr. Dunn. Yes.

                              KARNAL BUNT

    Mr. Skeen. I understand where you are going.
    The Arizona Department of Agriculture has said that the 
filters that were used to check for Karnal bunt spores were 
mislabeled by USDA, which resulted in the contamination problem 
that we now have. Is this the case and, if so, what is being 
done about it?
    Dr. Reed. Again, Mr. Chairman, let me respond to that. We 
know that there were some problems at a contract lab that APHIS 
does not operate, but oversees, in Arizona. There are two 
screens that APHIS provides to the lab to detect Karnal bunt 
spores. We found out that the screens were in the wrong place 
allowing spores to go undetected.
    A review team is beingassembled right now to review quality 
control at that lab to make sure it never happens again.
    Mr. Skeen. Well, sir, that is great news to the people that 
have been impacted by this Karnal bunt situation, which 
happened in New Mexico and Arizona. All of the efforts that one 
goes through in cleansing the equipment that is used to handle 
it have been very tough.

                         Organic Certification

    Dr. Figueroa, I realize that we may sound like a scratched 
record album here, but the 1990 Farm Bill authorized the 
development of nationwide standards for organic certification. 
I went back to March 1996 and found statements from AMS 
testimony regarding the proposed and final rule on organic 
standards and its implementation.
    I am not going to read them to you, but I am sure that they 
would sound familiar to you. Nine years and $3.2 million later 
there is still no final rule. And according to the budgets, you 
are planning to spend $923 thousand this fiscal year and 
another $1.7 million in fiscal year 2000 on this program, 
bringing the total to $5.8 million.
    What are the reasons for the latest delay in getting the 
final rules published and submitted?
    Mr. Figueroa. Good afternoon, Mr. Chairman, and members of 
the committee.
    Mr. Skeen. Excuse me for not being more amenable, but----
    Mr. Figueroa. You are not the first, Mr. Chairman.
    Mr. Skeen. And probably will not be the last either. 
[Laughter.]
    Thank you, Dr. Figueroa. Go ahead.
    Mr. Figueroa. We received, as you may know, a record number 
of comments on our proposed rule that we proposed in December 
of 1997--275,000. It is the most comments for any rule 
published in the USDA. Just the sheer volume of comments to go 
through, certainly required a good amount of time. In addition, 
there were three controversial issues within the proposed rule: 
irradiation, bioengineered products and the use of sewage 
sludge that the Secretary announced in May that we no longer 
include in the reproposed rule.
    Secondly, the industry came to AMS to request the issuance 
of three current thinking papers, which we issued in the latter 
part of last year. In those discussions, I mentioned and put 
forth to the industry that if we did those, it would prolong 
the issuance of the final rule. They felt it was better, in the 
long run, to have the issuance of these three current thinking 
papers, even if it prolonged the final rule coming out.
    Mr. Skeen. Finalizing the rule?
    Mr. Figueroa. We were going to finalize the rule in 1999 
and our goal is to try to have a final rule in 1999, yes, sir.
    Mr. Skeen. 1999. That is the reason for the delay?
    Mr. Figueroa. It was the volume of comments, sir, and as 
well as that, the issuance of three current thinking papers 
that required a comment period, and we had to focus on those 
three current thinking papers.
    Mr. Skeen. Well, you covered the whole gambit of problems 
dealing with it, and that is what is holding up the rule.
    Mr. Figueroa. The three current thinking papers were on 
three issues that were very important to the industry, that 
they felt they needed some additional comments on, yes, sir.
    Mr. Skeen. Very good.
    The organic industry is valued today at about $3.5 billion 
and growing at the rate of 22 percent per year. Why do we need 
a National Organic Standards Rule at all?
    Mr. Figueroa. The industry, as you know, came to Congress 
in 1990 because they felt that national standards would 
accomplish two things, and we concur with that. One is that 
national standards will assure all consumers in this country 
that when they buy a product that is labeled organically grown, 
handled and processed or produced, that they know that a 
minimum set of standards have been adhered to in the production 
and processing of that product.
    In addition, the industry felt, and we concur, that having 
this minimum national set of standards would indeed facilitate 
the growth of the industry. Clearly, the industry has grown in 
its current system of either State-based or private 
certification systems, but we feel, and I think the industry 
feels as well, that national sets of standards will expand the 
domestic industry.
    Finally, the entrance of organically produced products in 
the international markets we feel will also be facilitated by 
having a national set of organic standards, particularly in the 
European Union.
    Mr. Skeen. How is the term ``organic'' defined? And will 
the final rule on organic standards alter that definition in 
any way?
    Mr. Figueroa. There are currently 42 different 
certification entities in the country. Some are State-based 
programs, others are private- or quasi-private-based programs.
    Mr. Skeen. How are you going to split it?
    Mr. Figueroa. Each of those have fairly similar definitions 
of what constitutes organic production. We will likely be very 
consistent with the prevailing industry definition of organic 
production with our national standards, yes, sir.
    Mr. Skeen. Thank you. Thank you for your responses.
    [Clerk's note.--Subsequent to the conclusion of hearings on 
the fiscal year 2000 budget request for the Department of 
Agriculture, the Agricultural Marketing Service published a 
final decision on consolidating the 31 Federal milk marketing 
orders into 11 orders as mandated by the 1996 Farm Bill. The 
entire three-part final decision documents are on file with the 
Subcommittee. The following is a summary of the final decision 
as proposed by the Secretary of Agriculture:]


[Pages 458-469 -- The official Committee Record contains additional 
    material here]

    Ms. Kaptur.

                        asian longhorned beetle

    Ms. Kaptur. Thank you, Mr. Chairman. Welcome, gentlemen. I 
am so happy to have you here. I just love this group. I am glad 
they are here today. Enjoyed your testimony, Mr. Dunn. 
[Laughter.]
    I know the good work that they try to do and do.
    Dr. Reed, I wanted to start with you, if I might. On the 
issue of the Asian long-horned beetle, did you actually 
determine the origin of that?
    Dr. Reed. Yes.
    Ms. Kaptur. How did you do that?
    Dr. Reed. We inspected solid wood packing materials, 
crating materials for airfreight, and other freight arriving 
from China, and actually found larva and insects in the wood 
packing material. We then inspected a lot of wood packing 
material from several countries because this kind of damage 
occurs in wood crates and pallets where the lower grades of 
wood are used. It was in the wood packing material where we 
found the larva.
    Ms. Kaptur. Now, do you receive that material through U.S. 
Customs or do you have your own inspectors at certain ports of 
entry? How is it that you got the actual material?
    Dr. Reed. Customs looks at it first and then we get it.
    Ms. Kaptur. For how long had that been coming into the 
United States, do you estimate, before you actually got the 
sample?
    Dr. Reed. We detected the pest in New York a couple of 
years ago. Earlier last year, we found tree damage very close 
to O'Hare Airport in Chicago and through additional surveys, 
found the larva in the trees. The larva actually killed the 
trees after a couple of years. So it is not like it is a 
situation where you can live with this particular pest.
    Ms. Kaptur. I read in your testimony that you say that in 
New York, and you do not cover Illinois I do not think here, it 
has cost $5 million so far to remove the trees; is that true?
    Dr. Reed. The State of New York and the Federal government 
have spent $5 million in removing 2,500 trees.
    Ms. Kaptur. Have we really gotten a hold of this, do you 
think? Have we removed all of the trees? We do not know, those 
beetles could be out there.
    Dr. Reed. We conduct surveys to determine if there is 
damage or additional areas of infestation, but our main 
emphasis is preventing entry through wood packing material. We 
instituted an emergency rule last year and began implementing 
it the beginning of this year. We told China what was going on 
and what they had to do. So far we have had very good 
compliance.
    Ms. Kaptur. How much money has this already cost the State 
of New York, the Federal Government, the State of Illinois, the 
City of Chicago, or whoever is having to remediate?
    Dr. Reed. Let me get those figures for you, Congresswoman.
    Ms. Kaptur. What responsibility do the Chinese have for 
paying that bill? What portion of it have they paid and what 
mechanism do we have to get recovery--costs recovery?
    Dr. Reed. I do not know if we have a mechanism for 
recovering from the Chinese.
    Ms. Kaptur. Well, you have hit one of my favorite areas of 
inquiry. [Laughter.]
    I would very much appreciate it if you would try to get me 
figures on what these States and the Feds have spent thus far 
in remediation, and include in that any of your own research 
costs and other costs where you have had to do analysis and so 
forth to really figure out--include your administrative costs 
in that, and your projection for the next year; what you have 
spent to date and what your projection is over the next year.
    [Subsequent to the hearing, the following additional 
information was provided.]

    We estimate that about $9 million has been spent in this 
cooperative effort through this year. We estimate spending the 
requested $2.1 million for next year.

    Mr. Dunn. Ms. Kaptur, there are a couple of things. We try 
to do inspection of about 2 percent of everything that comes 
into the United States. APHIS looks at items that may have a 
pest or disease that would affect our agricultural interests. 
We were not always looking at solid wood packing material until 
after we had found a pest in it. Now we understand that wood 
packing material is a source of the pest. This is the reason 
why that infestation may have been here for four or five years 
before we discovered it.
    In Chicago, for instance, somebody found one of the 
insects, compared it to information on our Web site, and 
determined that they had the pest. So as you indicate, we need 
to do a much better job of getting the information out, so that 
we have more eyes and ears out there across the Nation to see 
if this pest is in other parts of the Nation.
    Normally, when we get an infestation, or some country gets 
an infestation, it is from a product that was brought in; it is 
the buyer beware. So, there really is not any legal recourse to 
say, ``All right, You have caused this disease, You have to pay 
for it.'' It is the receiving country's responsibility that 
incurs the pest to be on the alert. This is why having our 
first line of defenses are so important in APHIS, to keep these 
pests and diseases out and to have surveillance teams examining 
all the possibilities.
    Ms. Kaptur. Well, Under Secretary, I do not mean to 
disagree with you, but one of the problems with our trade 
agreements is we do not accommodate environmental issues. If I 
look at what happened with Gypsy moths, and we have had a 
little experience with that in our part of the country, having 
migrated from the East Coast, and we know just the amount of 
money this is going to--I really do believe that those 
responsible, including the shipping company and whomever, the 
freight forwarders, they are all responsible. It is not just 
the poor little taxpayer sitting in Chicago or New York that is 
responsible to pay this.
    So I am not saying you have not done a good job. I am just 
trying to, I guess, as the attorneys do, assess blame here and 
restitution, and this is an area that interests me a great 
deal, and I doubt that this is going to go away. I have a hunch 
these little beetles are going to propagate, and we are going 
to have to rip down more trees.
    Dr. Reed, what could they devastate? Let us say it is like 
the Gypsy moths, and we just cannot get control of it because 
there is no natural predator, what is it that they destroy?
    Dr. Reed. The preferred host is soft hardwood trees, like 
maples and elms. We are very fearful of the beetle migrating to 
our maple forests. Of course, everybody loves their big maple 
trees in their back yard so it is devastating for residential 
growers as well.

                       screwworm facility--mexico

    Ms. Kaptur. I thank you very much for your frank replies to 
that.
    Dr. Figueroa, I wanted to welcome you and ask you last year 
we discussed the APHIS facility in Chiappas, Mexico, that is 
scheduled to be closed in 2004. And we had talked about, yes, 
we have done a great job at eliminating screwworm on the 
continent and so forth, and that facility employed like 600 
people or something who are Mexican citizens.
    I had asked if the Department might talk to the State 
Department in the interim and see, knowing the conditions in 
that part of Mexico, if there was some other way which we could 
transform that facility. We talked a little bit about tropical 
fruits, about coffee, et cetera. Have you done any follow-up on 
that?
    Mr. Figueroa. Unfortunately, Congresswoman Kaptur, I have 
not done much follow-up on that specific issue.
    Ms. Kaptur. Mr. Dunn.
    Mr. Dunn. Congresswoman, I have traveled to Mexico, met 
with my counterpart, Sub-Secretary Gurria, as well as Minister 
of Agriculture Arroyo, to talk about this very issue. I talked 
to our ambassador in Mexico. He and I had planned a trip down 
to Chiapas to take a firsthand look, but have not been able to 
do that, to date, because our schedules have conflicted. But 
that is something that is very high on his list of things to do 
as well.
    Ms. Kaptur. I am really glad to hear that.
    I asked Dr. Figueroa because he had made a practical 
suggestion to me last year. So that is why I was interested in 
hearing what he had to say. But I am extremely interested in 
that, as you know, and we do not need to do anything to further 
destabilize that part of our continent.

                             concentration

    I wanted to thank Mr. Baker and your colleagues for 
conducting one of your listening sessions in the Midwest, in 
our part of the Midwest. We had, as you know, over 140 
producers. Your fine staff members who are sitting in the 
audience were there. They did a good job. Could you enlighten 
the committee a bit on what you learned from speaking to 
producers around the country and what you plan to do as a 
follow-up to those meetings.
    Mr. Baker. Yes. This was basically a whole rollout of our 
information. We did an investigation of the upper Midwest hog 
slaughter procurement, and we took our findings to the people 
to provide information. We found that the smaller producers may 
not have been producing the higher quality hogs like the larger 
producers were. Smaller producers were not taking contracts 
like the larger producers and maybe did not have access to the 
contract availability that the larger producers did.
    We heard it loud and clear in some meetings that contracts 
were available, but they did not want to make these kind of 
commitments that you have to make to get into the contract 
business.
    I think, from what we learned, that the price being 
reported on hogs was not the actual price of what hogs were 
trading for. Hogs were trading at a higher figure than the base 
price being reported. This was significant. Since this has been 
pointed out, Ag Marketing Services started reporting a higher 
base hog price. As I traveled the last two years, I heard 
people say, ``We sold our hogs for $4 over the top''. You do 
not sell hogs $4 over the top. You sell them for $4 over the 
reported top. So, let USDA get the information out there, get 
it all reported and let people know where they fall in the 
price structure.
    We saw hogs quoted and sold for as high as $7 over the top. 
Our focus is in packer procurement in the hog complexes in the 
Midwest, and we hope to do a lot more work there with your help 
in our budget.
    And, the roll-out has been beneficial. The producers that 
we have talked to, by and large, are very appreciative of 
ourlooking at this. We conducted an investigation in 1996, but the 
rollout fell at a time when there were depressed prices in the hog 
industry. The biggest complaint we heard was that our information was 
not timely, and that was a valid complaint. The investigation happened 
two years before we rolled out the findings.
    But because we were there at a time when the prices were 
depressed, we could address, along with the other agencies that 
went with us, concerns farmers had about price and market power 
and being able to get into the market.
    Ms. Kaptur. Do you intend, Mr. Baker, to have a final 
report that then shows which policies you are going to 
implement within the Department or what types of initiatives 
you are going to have as a result of those meetings?
    Mr. Baker. Yes, we have a report. A final report has been 
made, our initiatives are moving forward, and we have an 
additional investigation underway. Also, out of this, we 
undertook three additional investigations that we are pursuing 
in the pork complex.
    Ms. Kaptur. To the extent you can provide your summary 
report to the record----
    Mr. Baker. Yes, I can.
    Ms. Kaptur [continuing]. Could you do that, please?
    Mr. Baker. Yes, I can.
    Ms. Kaptur. I would be very, very interested in that.
    While your people were in Ohio, what was interesting was 
that we had people in that room who were burying animals at the 
very same time that our feeding kitchens in our adjacent cities 
needed food.
    And so as I look at the Agricultural Marketing Service and 
I think about what you can do as an Agency, as a Department, I 
hope that, as you think about procurement, and you think about 
ways of marketing and how you reach people, that--and I was 
just talking with Mr. Nethercutt about this--how we are able to 
focus our purchases on farmers.
    How can we do a better job of targeting some of those 
people that ended up in those rooms and without doing too much 
damage to the pricing system overall? And if there are any 
actions we can take this year, I know from the emergency bill 
last year, some of those payments are going to be going out, 
but as we sit here today, they are burying animals. That just 
does not seem like the best solution, certainly for the farmer 
and certainly for those in need in our country.
    Any insights you might have from those hearings where you 
could give us advice as we proceed through the first 
supplemental we will be having and maybe a second supplemental 
and whatever our appropriation bill will be for this year, I, 
for one, would be very grateful.
    I know others want to ask questions.
    Mr. Baker. We will submit it for the record.
    [The information follows:]


[Pages 475-508 -- The official Committee Record contains additional 
    material here]

    Ms. Kaptur. Thank you very much.
    Thanks, Mr. Chairman.
    Mr. Skeen. Mr. Bonilla.

                           Australian Cattle

    Mr. Bonilla. Thank you, Chairman.
    Dr. Reed, I would like to start with you, if I could. We 
have had a concern since last fall, when there was an effort to 
move some Australian cattle through Mexico, and, as a result of 
that, we put some language in the conference report asking you 
to establish some protocols on verification procedures, to 
establish permanent country-of-origin marking requirements for 
each county or region requesting to export livestock to the 
U.S. We have not seen those protocols yet, and I am wondering 
when those might be available. We are getting a lot of calls 
from ranchers back home.
    Dr. Reed. We are working on those protocols with Mexico, 
and we expect to have a North American protocol, with Canada, 
the U.S., and Mexico all having the identical standard.
    Right now, there are some protocol differences between the 
U.S. and Mexico when cattle originate in North America, but 
this does not fully address situations like the cattle coming 
in from Australia. We did not anticipate thatMexico or other 
countries would broker cattle coming through to the U.S. There are some 
additional controls that need to be worked out so that all three of the 
North American countries are the same.
    Mr. Bonilla. There is no attempt to move any more cattle 
from Australia? You have not heard anything about that, have 
you?
    Dr. Reed. No. We would receive a request for an export 
permit from Mexico. And we would know it is a third party. But 
we have not received such a request.

                           Wildlife Services

    Mr. Bonilla. I want to move now, Dr. Reed, to the animal 
damage control program. I have a lot of sheep and goat 
ranchers, as you probably know, in my congressional district. 
The pilot gunner positions were lost, which shut down the 
fixed-wing operations in that part of the State, and 
specifically right around the area of Fort Stockton, Texas.
    My understanding is that you still have the aircraft 
available, but are just short of the manpower to fly the plane. 
Is that true? And is there any way that we can work with you to 
get this up and running again?
    Dr. Reed. Let me ask my expert, Bob Acort.
    I have just been informed that that should not be a 
problem. We will see what is transpiring there and try to get 
those folks back in the air.

                              Tick Riders

    Mr. Bonilla. I appreciate that very much.
    I want to move now to another issue that may be somewhat 
unique to my area, and that is the tick riders that watch for 
the fever ticks to prevent them from coming across the Mexican 
border. They are almost out of the old days. They ride for days 
out in the brush country in some dangerous conditions with very 
limited resources. One of my staff from district office, my 
district director, has actually spent some time riding out with 
them to see what they face. I think they, quite frankly, are 
overlooked sometimes. They are at the end of the country 
logistically, and they are doing something that really does not 
have a lot of interest beyond the area along the Mexican 
border.
    I am wondering if you are aware that this program is 
inadequately funded and these guys are really struggling out 
there to make sure that we are not infected with some disease 
coming across the border. It is very important, especially, I 
would hope, in light of the administration's concern about 
spreading disease coming from other parts of the world.
    Dr. Reed. Congressman, we know that those tick riders are 
truly the last of a breed. We have maintained their funding in 
the fiscal year 2000 budget request. We know that it is the 
only way we can maintain surveillance in that area. Nobody has 
figured out a better way of performing this valuable inspection 
work. We plan to maintain current funding levels for this 
activity.
    Mr. Bonilla. But more specifically, not only do we want to 
maintain them, but the people out there are struggling just to 
keep their nose above water because of the lack of resources. I 
also may want to discuss their pay grades, separately at a 
later date. My understanding is that they have been operating 
at a pay level lower than a lot of their counterparts who are 
doing similar work in other Federal agencies policing borders.
    This is more my concern. I wonder if you are aware that 
they have been, frankly, only maintained and really not given 
what they need to do their job well.
    Dr. Reed. I was not aware of the inspectors' pay and grade 
inequity issues. I will review the situation and set up a 
meeting to discuss it with you.
    Mr. Bonilla. I would really like to do that.
    Mr. Dunn. Usually, when we do this, we call it a desk 
audit, but I guess in this case it would be a saddle audit----
    Mr. Bonilla. That is right.
    Mr. Dunn. I would like to take a moment to talk about the 
many fine men and women that we have in all of Marketing and 
Regulatory Programs. They are on the front line, putting 
themselves in extreme danger, as the tick riders do. I am sorry 
to report a couple of fire bombings of some of our Wildlife 
Services offices. This gives us a great deal of concern. We 
look favorably to working very closely with the committee to 
improve the well-being of those individuals that serve all of 
us so well.
    Mr. Bonilla. My understanding is they need spray dip 
machines and treated corn to feed wildlife. There is probably 
not a real long list. It is not a big-budget item, but it is 
extremely important down there, and I am looking forward to 
working with you on this particular issue, Dr. Reed.

                               Screwworm

    I am going to move now to a screwworm issue. As you noted 
in your testimony earlier, a screwworm larva was collected from 
a goat in Edwards County, which is also right in the heart of 
my district. This gave many of my producers a real scare, and I 
want to commend you, first of all, for quickly responding and 
doing what you had to do to deal with the situation. I also 
agree that this does clearly demonstrate the need for constant 
vigilance because you never know when something is going to pop 
up.
    What was the final assessment of this incident in Edwards 
County, and do you know how the goat contracted the screwworm, 
and have you continued surveillance in this region to see if 
there are any other problems out there?
    Dr. Reed. Let me start by answering your last question 
first. We are continuing surveillance efforts. It gave us a 
real scare to find a single screwworm anywhere in the United 
States. We have performed all of the epidemiologic tests to 
determine how this screwworm got to Edwards County. It was the 
only incident around. We inspected all of the surrounding farms 
and found no additional cases. We are exploring how the actual 
screwworm larva was submitted to the lab. There were some 
questions about an old screwworm bottle and things like that. 
So we are still looking into it, but the bottom line is we are 
maintaining surveillance of nearby premises and have not found 
any additional screwworm cases.
    Mr. Bonilla. I appreciate that. We are going to be keeping 
an eye on that situation as well.

                              boll weevil

    My last question has to do with the boll weevil eradication 
program. The fiscal year 2000 budget proposes a $12 million cut 
to this program. It has been a very successful program. It is 
very important with new eradication zones entering the program 
every year the budget be maintained. The program stretches all 
across the South into Texas and New Mexico now.
    The cost share provided by APHIS is about 4 percent of the 
total program. I understand that about $4 million of the 
current $16 million is USDA overhead. The growers have 
expressed a strong desire for USDA to continue to be involved 
in the program and, in turn, have shown their strong financial 
support.
    Other parts of USDA's budget emphasizes a desire to reduce 
pesticide usage and develop pest management systems for crops 
that are more IPM-based. This is the goal of boll weevil 
eradication. It has been successful in accomplishing this goal 
in many States, such as Georgia and South Carolina.
    Why would APHIS look to cut funding at this critical time 
just as the program is expanding and has proven to be a 
successful program?
    Dr. Reed. Let me answer you two ways. Boll weevil 
eradication is a successful program and APHIS funds are 
currently passed through to growers. Loans are available to 
people who grow cotton, but who also enjoy the benefit, when 
there are no weevils. The payback is $12 dollars for every 
dollar spent on the program.
    We have, basically, a good system of providing technical 
assistance which has been proven throughout the Southeast and 
will be used through Louisiana, Texas, and into New Mexico. We 
see to it that programs that are currently involved in 
eradication efforts or that have voted to begin an eradication 
program--and they must have a positive vote to begin an 
eradication program--are going to continue to be successful, 
and APHIS will continue to support them.
    But the loan program--the obvious answer is not that APHIS 
is trying to get out of it. We pass most of the money through 
any way. We do have the right kind of knowledge to make active 
eradication programs successful. We will continue to provide 
technical assistance to make eradication possible.
    Mr. Bonilla. This is another area I really want to work 
closely with you on. It seems like all of my questions fall 
under your jurisdiction, and have a direct impact on my 
constituents. So I look forward to working with you on some of 
these issues we have discussed here today.
    Thank you for your time today, Dr. Reed, gentlemen.
    Mr. Skeen. Mr. Boyd.
    Mr. Boyd. Thank you very much, Mr. Chairman. I am so 
excited, I do not know where to start here with these 
gentlemen. [Laughter.]
    Let me start by saying to Mr. Dunn thank you for working 
with our folks on the citrus canker issue. The meeting that you 
held last week was very helpful in helping us understand what 
could be done and what needed to be done. I wanted to thank you 
for that.
    And also to Dr. Figueroa I wanted to say I apologize for 
missing our meeting in the office today. You know how it works 
up here when they call a vote.
    Ms. Kaptur. Will the gentleman yield?
    Mr. Boyd. Yes.
    Ms. Kaptur. I just thought, perhaps, for some of the 
members who may not represent citrus companies and some of the 
members of the audience, you could explain how serious that 
problem is.
    Mr. Boyd. Thank you very much, Ms. Kaptur. I will in my 
questioning.

                              boll weevil

    But before I do that, I want to turn to Dr. Reed and 
follow-up on the question of my friend from Texas, Mr. Bonilla, 
as he walks out the door, to let you know that there is a 
member sitting on the other side of the chairman that has a 
keen and long interest in the boll weevil eradication program.
    Probably most of my work with your shop over my 
professional career has been with APHIS because of my 
involvement when you expanded that program into Georgia, 
Florida and Southeast Alabama in the eighties. You remember we 
had some cotton in Florida, too. We had 25,000 acres back in 
1985 when we started that program, and now we are running about 
200,000 acres as a result of your program's success.
    I just wanted to relate to you, and to the other members of 
this panel and to the members of this audience what that has 
meant to us.
    Prior to the eradication of the boll weevil, when we had to 
fight that pest on a regular basis, I had constituent farmers 
that sprayed their cotton an average of 18 times a year. Now, I 
want you to think about this in terms of costs; that is, dollar 
cost and environmental cost--18 times a year. Currently, our 
average spraying in the area that I represent probably is two 
times a year. So we have reduced it to almost 10 percent.
    Two other things happened. One, is the increase in the 
yield that is inherent when you eliminate a pest. The other 
thing that is important to us is to think about is all of those 
organophosphates and other chemicals that we were using on our 
land and in the atmosphere, to fight that pest.
    I want you to do, whatever you have to do, to make sure 
that we do not allow that kind of pest or that particular pest 
to return to attack our cotton crops. It is just imperative 
that we continue to fund this successful program.
    I know you have got a 70/30 share program or used to have, 
at least when I was first involved with it. I do not know what 
it is now. It looks like it may be 3/97 share based on the 
budget proposal. But I have strong feelings about that small 
figure in the budget proposal and would like, Mr. Chairman, to 
make sure that we restore funding because that is a serious 
issue for us.
    I want to ask you, Dr. Reed that what I hearyou saying is 
that it's just an issue of reallocating dollars. We still have got 
containment and maintenance costs, and we are still expanding the 
program. We are still moving the program into new areas, but you are 
just going to ask the States and the growers to pick up more of the 
costs; is that what I hear you saying?
    Dr. Reed. That is basically it, and we still want to do 
surveillance and trapping to make sure that this is not a 
problem that comes back and the goal of eradication gets away 
from us.
    Mr. Boyd. Well, I want you to know that I am with you in 
making sure that we have adequate dollars needed to control 
that pest.

                              brucellosis

    Secondly, on brucellosis, I notice there is a cutback on 
your brucellosis program. But I read the narrative that you had 
presented, and basically it appears that that is a cutback 
because we are winning that war. Is that a fair assessment?
    Dr. Reed. That is a fair assessment. We have got five herds 
left in the U.S. under quarantine, and we plan to have zero 
herds by the end of the summer, so that is a war we are 
winning. Again, just like boll weevil, we have to be vigilant 
and watch for reinfection to avoid a problem that hurts our 
farmers and keeps us from moving their livestock freely.

                             foreign pests

    Mr. Boyd. Now, I want to turn to--and maybe, Mr. Dunn, I 
will try to paraphrase from the comments that you made--because 
I want to turn to the issue of citrus canker and not only that 
pest, but others that come in through our ports because of our 
very, very aggressive trade policy that we have. Your words 
were, and I paraphrase, it is important, if we are going to be 
in a global market, and then you went on to explain about 
exotic pests, phytosanitary issues, all of those issues, and 
that we devote adequate resources in these areas, and we have 
not done that. I want the staff, if you will, to pass out a 
chart that I have for the record, Mr. Chairman, to you and to 
the members of the panel, and I want to read a few items from 
it.
    These are pests that have impacted Florida agriculture just 
over the last four years: foreign pests, citrus canker, Medfly, 
thrips palmi--that affects bell peppers--brown citrus aphid, 
citrus leafminer, Oriental fruit fly, sweet potato white fly, 
pine-shoot beetle, leather leaf fern anthracnose, equine 
piroplasmosis--excuse me. I am not good on these scientific 
names here--hard water disease, and tropical soda apple.
    The State of Florida, in the last four years has spent 
about $32 million fighting to control these pests. The 
University of Florida has spent about $15 million on research 
to combat these pests. We estimate the industry costs for 
control to be about $100 million, and we estimate the impact on 
sales to be in the neighborhood of about two-thirds of a 
billion dollars.
    The highlight of that is the citrus canker issue, no doubt 
about it, because those are where the big dollars are. That is 
where the industry has been significantly harmed. We got a 
problem in Florida that started within 100 yards of the Miami 
Airport, came in on a plant from overseas, through Customs, got 
right by your people, (APHIS inspectors) and now we have a 
serious problem that threatens our entire citrus industry.

                   agricultural quarantine inspection

    I have two questions relative to that. One is, on page 3, 
Dr. Reed, in your testimony, the 1998 APHIS officers inspected 
an all-time high of 76 million international air, maritime, and 
land border passengers. Now what percentage of the total 
passengers that came into this country is 76 million?
    Dr. Reed. These are just from the international flights.
    Mr. Boyd. Right.
    Mr. Dunn. That would be 100 percent.
    Mr. Boyd. That is 100 percent.
    Mr. Dunn. Yes, 76 million.
    Mr. Boyd. The other question then is to educate me how does 
this work. Does Customs receive the passenger first, and then 
if there is a problem, refer the passenger to your inspectors 
or how does that work and how can we improve it to make sure we 
are not introducing these pests on a daily basis?
    Dr. Reed. Actually, passengers go through Customs first, 
and then Customs refers them to APHIS based on the declaration 
card that is completed upon arrival into this country.
    We are working with Customs to make the clearing process 
better because we know that people remark to us that they were 
on a farm or that they have agricultural products in their 
possession and nothing ever happened. Nobody ever asked them 
any questions. So we have got to do a better job of getting 
Customs to refer travelers to APHIS so we can ask the right 
questions and then examine the agricultural products.
    Mr. Boyd. So it is a matter of educating Customs folks 
better. Is that what I hear you saying?
    Dr. Reed. Well, that is partially true. We also are 
experiencing significant growth of international airports so we 
have increased staffing issues to ensure we have the right 
numbers of people there to examine the flights.

                             citrus canker

    If you would permit me to comment on citrus canker. This 
bacterial disease is easy to spread, whether from plant 
material, clothing, or equipment. We are particularly worried 
that it is going to get away from us, and we may not be able to 
do anything about it unless we get the commitment to go after 
it aggressively.
    Mr. Boyd. You are not nearly as worried as some of the 
folks back home that are feeding their families with the income 
generated by those citrus trees, I can tell you.
    Dr. Reed. Well, I know it will impact producers enormously 
because not only is it going to destroy trees, but will also 
restrict the movement of fruit out of an area, and the fresh 
fruit market could possibly be eliminated.
    Mr. Boyd. For the members of the panel, for the members of 
the committee and the audience, when you get citrus canker 
introduced into a grove, first of all, it comes under 
quarantine by USDA officials to prevent the spread of it, and 
your export markets are immediately closed because the other 
countries will not have anything to do with you if you have 
citrus canker.
    Secondly, the only way to cure it is to push the tree and 
burn it and leave the land idle for two years, and we do that 
with a buffer zone circle around it of clean trees. We have 
been through this in Florida in the late eighties, and it is 
not a pretty sight. I just want you guys to know whatever this 
member of the committee can do to help you guys assist us, we 
have to fight the spread of this disease. It is a very, very 
serious thing, and that is why I want to thank you forhelping 
us figure out how we solve this problem.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Nethercutt.
    Mr. Nethercutt. Thank you, Mr. Chairman.
    Welcome, gentlemen.

                                tck smut

    The last four years that I have been on this subcommittee I 
believe every time I have asked you about the issue of TCK Smut 
relative to China and why that market seems to be resistant to 
the export of our wheat from my State of Washington? In fact, 
last year I had a response from Mr. Medley with regard to this 
subject and he answered in response to a question I made about 
TCK Smut and the Brazil analysis and then how that relates to 
China, and he says, we should be able to export to China 
without presenting a significant risk. We will be carrying the 
same message as we continue these discussions with China. This 
action should help us, the Brazil determination, and enhance 
our chances of establishing scientifically-based criteria in 
China as well.
    My question is where are we one year later, several years 
later, as far as I am concerned and are we any closer to being 
able to deal with China on this particular issue of TCK Smut?
    Mr. Dunn. I am delighted to report that I was in Brazil 
last year where we signed the agreement which Brazil dropped 
their objections on TCK. It was a very big day for me and one 
that I felt very proud of the men and women in APHIS and being 
able to sign the agreement.
    We are continuing to work with China. You can imagine their 
concern when I told them about problems with their solid-wood 
packing material.
    Mr. Nethercutt. Right.
    Mr. Dunn. They immediately put up a quid pro quo on TCK. We 
have members of USTR and State Department even as we speak in 
negotiations with China. We are getting closer to an agreement.
    Mr. Nethercutt. How do you quantify that for me, Mr. Dunn? 
And I appreciate the difficulty of dealing in international 
relations but what do we need to do here? What will grant us 
the breakthrough or, in all honesty, is there not going to be a 
breakthrough? Is China just resistant, they do not want to do 
it, and, you know, we are sort of having to say, we accept 
that? What is it?
    Mr. Dunn. Mr. Nethercutt, we have done everything we can on 
it, technician-to-technician, scientist-to-scientist basis, to 
point out that this is merely a quality concern, it is not a 
major disease. It is at a policy level. We have USTR and State 
working as hard as they can right now to resolve this matter.
    We will continue working technician-to-technician, 
scientist-to-scientist, giving them every bit of information 
that they ask for, conducting tours, showing them what we have 
here in the United States, and why we do not see it as a 
problem. Ultimately, it is going to be a policy decision.
    Mr. Nethercutt. Are you optimistic or are you resigned to 
the idea that this is a very tough issue to try to break 
through and we should not get our hopes up?
    What more can you say? It may not be a fair question to 
you.
    Mr. Dunn. I am guardedly optimistic that we are making 
progress.
    Mr. Nethercutt. Are you communicating with State and USTR 
on a regular basis?
    Mr. Dunn. Yes, we are. When Ambassador Barshefsky went to 
negotiate, we provided a great deal of information to her. Our 
people, as well as the ORN-AG service people are meeting with 
them, as well as the Secretary. So, yes, we are working 
extremely close on this issue. This is well coordinated within 
the United States.
    Mr. Nethercutt. Would you kindly, to the extent you are 
able, provide this committee with an update on the current 
status of activity with State and USTR as it relates to your 
offices or USDA in general?
    Mr. Dunn. We will do that.
    [The information follows:]

    The Office of the U.S. Trade Representative (USTR) is the 
lead agency on any trade issue. For example, if a serious SPS-
related trade issue comes to the attention of the 
Administration, we must work with the USTR before any SPS issue 
is taken to the World Trade Organization's Dispute Settlement 
Body (DSB). The USTR also chairs the Trade Policy Staff 
Committee, comprised of many interested government agencies, 
which decides which issues go before the Dispute Settlement 
Body. All USDA Agencies work together before submitting an 
issue to the USTR and the Trade Policy Staff Committee. Once an 
issue is presented to the DSB, APHIS provides the technical 
information which is the basis for the U.S. argument.
    The Department of State would always be involved in any 
sensitive issue related to foreign policy matters. Since State 
is also a member of the Trade Policy Staff Committee, they must 
also understand the SPS issues and approve any decision to take 
an issue to the WTO.

                             alar residues

    Mr. Nethercutt. That would be great.
    I just have one more question, Mr. Chairman, I do not want 
to abuse my time here.
    You, I am sure, gentlemen, have seen the latest salvo, I 
guess, that has been thrown relative to the safety of our foods 
and vegetables. It is sort of the 10 year anniversary of Alar. 
And I have seen recently some consumer groups coming out and 
saying our food is not safe to eat and our children should not 
eat vegetables and fruits.
    What are you doing to combat this? I think this is a huge 
red herring. I think it is a misinformation campaign as best I 
can tell and if I am wrong on that you tell me, since this is 
your business.
    My sense is it is unfair to the consuming public. I hope 
that your agency or someone in USDA deems it appropriate to 
respond to whatever junk science might be out there relative to 
this argument that there is some great danger if we eat fruits 
and vegetables in America.
    If I am over-stating it, tell me that, too.
    Mr. Figueroa. Mr. Nethercutt, the two reports that you are 
referring to--Consumer Reports issued a report and then that 
was followed by the Environmental Working Group that followed-
up within days or weeks. First of all, we were surprised in the 
sense that generally in the past we have gotten a lot of press 
calls, at least in the Agricultural Marketing Service. It was 
very quiet vis-a-vis some other things that have happened in 
the past.
    So, that is, I think, some good news in the sense that 
other media did not, at least, inquire at our agency to follow-
up on this story.
    Both reports relied on our pesticide data program data. It 
is our position that we are generating data and other 
individuals or entities it is for them to interpret the data 
that we report.
    Thirdly, a number of the research and promotion boards have 
implemented some programs to react to some of these scares, if 
you will, that I think have been very effective. And I think 
that those plans are in place specifically for these purposes, 
so, that when and if they get inquiries about some of these 
issues being raised they have the materials prepared to respond 
accordingly. And I think that they have been effective, at 
least in this case.
    Mr. Nethercutt. Your agencies, I assume, are satisfied that 
there is not a safety risk, that the consumer does not have to 
be reacting to these kinds of reports, that there is safety in 
our--notwithstanding the development under the PDP--that the 
consuming public is safe, is that a fair statement?
    Mr. Figueroa. As you know, Mr. Nethercutt, we have another 
agency within the USDA that is entirely responsible for the 
safety of food. And it is not our position nor is it in our 
mission statement but it is clearly within AMS' role to 
facilitate the marketing of wholesome foods and I think we are, 
indeed, meeting that mission responsibility.
    Mr. Nethercutt. All right.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Dickey.
    Mr. Dickey. I want to thank Mr. Farr for allowing me to do 
this and I want him to know that our relationship now has a 
chance to get started. [Laughter.]

                           fish eating birds

    Mr. Dickey. I just want you to know that. I have two 
questions.
    It is about cormorants and egrets and other fish-eating 
birds that are just taking us by storm in Arkansas. We seem to 
be breeding these birds by feeding them with our fish. Here is 
my question: How much success has Wildlife Services had 
studying fish-eating birds in an effort to control their impact 
on the aquaculture and sports-fishing industry?
    Dr. Reed. Congressman, we know that cormorants are a 
problem in your State and in others because they can devastate 
both bait fish and farm-raised fish. We have gained some 
knowledge in developing control management plans, but it is a 
difficult problem that continues to move on us.
    Wildlife Services is committed to helping all the 
industries associated with these kinds of bird problems with 
fish.
    Mr. Dickey. I think we have done everything we know to do 
to scare them away and we have used shotguns and then we have 
these automatic sound devices. They are actually landing on 
these things now. [Laughter.]
    So, what I am saying to you that it is just unbelievable 
and the birds are getting bigger and bigger, you see, because 
they are eating the fish in our ponds.
    Mr. Dunn. We have, in Wildlife Services, a group in our 
Starkville, Mississippi, area that studies habitat 
manipulation. We also have a tremendous problem with black 
birds that are consuming rice in your part of the world and 
sunflower seeds up in the Northern Plains. The Atlantic 
migratory bird flyway area seems to be a growing problem where 
we must consider both non-lethal and lethal means of 
assistance.
    Mr. Dickey. One last question. In the budget do you have 
more or less money or the same for whatever studies you are 
making on this?
    Dr. Reed. I am assured that we have the same amount.
    Mr. Dickey. Then I have one more question. If you got 
additional funds, what could you do to help with this problem?
    Dr. Reed. This problem requires good, sound research to 
find other methods of controlling these bird populations and 
predations. The National Wildlife Research Center conducts this 
type of research and would be allocated additional funding if 
it were provided.
    Mr. Dickey. Thank you.
    Mr. Chairman, thank you for taking me out of order and Mr. 
Farr.
    Mr. Skeen. Have you tried chili on those birds? [Laughter.]
    Mr. Dickey. That is a country in South America, is it not?
    Mr. Skeen. No, it is a Southwestern dish.
    Mr. Farr.

                            argentine citrus

    Mr. Farr. Thank you, Mr. Chairman.
    I want to thank my colleague from Florida for giving us the 
best reason to buy California oranges. But I want to follow-up 
on an issue that is of interest to everybody in this 
subcommittee and it regards APHIS' issue with Argentine citrus. 
I understand that APHIS is using funds in this next fiscal year 
to consider a rule which will permit fruit that admittedly is 
carrying one or moreplant diseases to enter the U.S.?
    Dr. Reed. APHIS does not have a rule that would permit 
quarantinable diseases to come into the U.S.
    Mr. Farr. Do we allow fruits in now under the 1912 Plant 
Quarantine Act that have any kind of diseases whether 
quarantine or not?
    Dr. Reed. Nothing of quarantine significance.
    Mr. Farr. What does that mean?
    Dr. Reed. Certain conditions would be permitted that are 
quality-related or that will not pose a problem to any of our 
producers here.
    Mr. Farr. So, you do not have a policy that allows a 
diseased fruit to enter the U.S.?
    Dr. Reed. No, APHIS does not.
    Mr. Farr. And are you planning to allow diseased plants and 
vegetables to enter the U.S.?
    Dr. Reed. I am not aware that we would allow diseased 
plants and vegetables to enter the U.S. either.
    Mr. Farr. Our office has been told that there is a problem 
with what you are allowing to come into the U.S. now with the 
Argentine citrus, are you aware of that problem?
    Dr. Reed. I am aware of the request from Argentina to 
permit citrus under certain conditions to enter this country. 
There has been a pest risk analysis conducted by the U.S. on 
that commodity that would come from Argentina that has been 
made public. We recently concluded the comment period on a 
proposed rule.
    Mr. Farr. And then after that, what happens? Can the 
imports then come in?
    Dr. Reed. I am not sure if this is something we can 
discuss. Once completed, we would be glad to discuss it with 
you, Congressman. [Laughter.]
    Mr. Dunn. The Administrator's concern is, are we in ex-
parte because we are in the process of making a rule and we 
usually do not discuss it until we have actually finished a 
rule. But we can talk about process in that very general 
manner, Congressman Farr.
    There is a desire for us to have trade. Just as we are 
asking Argentina to accept citrus from Florida, and we can 
certify to them that it is from an area free from citrus canker 
or an area free from Medfly, and they would accept our 
regionalization rule. We would accept their regionalization 
rule. If we have done a pest risk analysis and they have proven 
to our scientists that they have protocols in place, that would 
assure us that diseased fruits and vegetables would not enter, 
then we should allow entry. This procedure follows WTO rules.
    Mr. Farr. As you can tell from Mr. Boyd's questioning, this 
is an issue that States with citrus growers are very concerned 
about. One of the difficulties we have is how to keep American 
growers viable and that is in the best interest of the national 
economy.
    We are very concerned about the possibility of adopting 
rules that would allow citrus into the U.S. with more than just 
the citrus, but also the problems that have been spoken about.

                             animal welfare

    Let me shift to another area and we can talk a little more 
about citrus at a later date. In the animal care and animal 
welfare area, Congress adopted in 1966, the Animal Welfare Act. 
I understand that under this law you have to inspect 
approximately 10,000 regulated facilities, is that correct?
    Mr. Dunn. That is correct.
    Mr. Farr. And that your budget for these inspections has 
been level funded for several years?
    Mr. Dunn. It has been approximately $9 million since 1991.
    Mr. Farr. How many field inspectors do you have to cover 
the 10,000 facilities?
    Dr. Reed. About 70.
    Mr. Farr. How often are the required facilities inspected?
    Dr. Reed. We average about one inspection per facility per 
year. Some facilities get inspected more than others based on a 
risk assessment and their potential problems. Others who have a 
good track record do not get inspected as often.
    Mr. Farr. I have a letter here from the American Veterinary 
Medical Association and it is signed by 480 entities. It is a 
broad coalition of veterinary, research and animal welfare 
groups. They are urging that the budget be increased to $13 
million to adequately address this problem. 10,000 required 
facilities with 70 inspectors is just not enough.
    Also there are some concerns about problems with airline 
shipment of animals. Are the field inspectors not the same 
inspectors that have to do the airline shipments?
    Dr. Reed. Yes, our inspectors who review facilities also 
inspect animals being shipped on airlines.
    Mr. Farr. The problem with a lack of inspectors is 
increasing because we are carrying more animals on airlines. 
And would you get back to us on exactly what funding you need 
to do an adequate job on this? I am going to be seeking an 
increase in the budget for this amount to improve the 
efficiency and credibility of your inspections.

                            horse protection

    Lastly, I would like to ask you about an area surrounding 
the controversy on the new strategic plan for the enforcement 
of the Horse Protection Act. Can you tell me how many horse 
shows APHIS inspectors attend?
    Dr. Reed. Yes, our inspectors attend about 40 to 50 shows a 
year.
    Mr. Farr. And what is that as a representative of the 
whole, about 10 percent of the problem, less than 10 percent?
    Dr. Reed. Yes, it is probably less than 10 percent.
    Mr. Farr. How many inspectors are involved in this program?
    Dr. Reed. About 35.
    Mr. Farr. And what do you do when inspectors are not there?
    Dr. Reed. There is usually a horse industry official that 
is also responsible for inspecting horses for soring. Our 
veterinary inspectors monitor those officials to make sure they 
properly identify a sore horse.
    Mr. Farr. So you are sort of turning it over, you are 
ceding authority to the industry?
    To inspect itself?
    Dr. Reed. I guess I would not characterize it quite that 
way. I would say that the industry has taken responsibility to 
make sure they do not permit sore horses in shows. They enforce 
the soring and scarring rules under the Horse Protection Act. 
There has not always been consistent interpretation of how 
these standards apply in all cases. We have a horse inspection 
operating plan out there and we do try to work with these 
industry officials to make sure that offenders are put out of 
the horse show business.
    Mr. Farr. Well, Congress has authorized the expenditure of 
$500,000 in this arena, and I do not know, what is your 
appropriation now?
    Dr. Reed. About $361,000.
    Mr. Farr. Do you think that you need more?
    Dr. Reed. We know there are many horse shows and we know 
expectations go beyond our current resource levels. We have 
people dedicated to attending horse shows to make sure rules 
are enforced and sore horses are not shown. The way to make 
progress is to bring some of these bad offenders up on legal 
charges and get them out of the horse show business.
    Mr. Farr. Have we been doing that?
    Dr. Reed. Yes, we have.
    Mr. Farr. And you have been monitoring the industry 
inspectors?
    The designated qualified person program?
    Dr. Reed. Yes, We monitor them, we make sure that we are 
consistent. Dr. DeHaven and his staff have gone to Tennessee 
and surrounding areas numerous times throughout the last year.
    There is agreement that, when a horse is sore, everyone is 
in agreement. There have been some initial disputes over the 
amount of scarring needed to disqualify a horse. We are working 
through issues such as these. Some of the discussions appear to 
seem subjective depending on individuals familiarity with the 
horse show industry.
    The objective is making sure that sore horses are not shown 
or sold. The trainers, owners, or others responsible for using 
unlawful methods such as hot mustard or pressure-shoeing to 
sore horses, should be forced out of the horse show business.
    Mr. Farr. If more money was appropriated, how would you use 
it?
    Dr. Reed. We would be able to attend more horse shows by 
having more inspectors able to examine show horses.
    Mr. Farr. Okay. Thank you very much.
    No further questions, Mr. Chairman.
    Mr. Skeen. Mrs. Emerson.

                        contract poultry growers

    Mrs. Emerson. Thanks, Mr. Chairman
    Mr. Baker, tell me what the status is of GIPSA's rule on 
contract poultry growers and the contract poultry industry, 
please?
    Mr. Baker. The proposed rule on feed weighing in the 
contract?
    Mrs. Emerson. Yes. I want to know what the status is and 
also perhaps what you learned from the comments that you all 
received under the proposed rule-making
    Mr. Baker. We proposed rule-making on feed weighing to 
ensure integrity in the feed weighing system where feed becomes 
part of the contract settlement.
    That has cleared the Department and it has been moved to 
the OMB. As soon as they get it back to us we will initiate the 
rule-making but it is in OMB at this time.
    Mrs. Emerson. And I am kind of curious--
    Mr. Baker. That went this week.
    Mrs. Emerson. This week
    Mr. Baker. Yes, this week.
    Mrs. Emerson. All right.
    In the original announcement, the advanced notice of 
proposed rule-making, one of the things that was included and 
one of the things that my contract poultry growers are real 
concerned about has to do with the procedures related to the 
weighing of the live birds delivered to the processors.
    And, so, that was included in this original announcement?
    Mr. Baker. There were three original ones that were 
included.
    Mrs. Emerson. Right. Can you just tell me why you decided 
not to address that particular issue in the proposed rule?
    Mr. Baker. It would be addressed in a separate proposed 
rule if we felt it was necessary. We are doing an investigation 
in the industry today to determine if it is necessary that we 
move forward on that one.
    Mrs. Emerson. Do you have any idea when that investigation 
might be concluded
    Mr. Baker. I am told that that investigation has just 
recently been concluded. We are examining the data on the 
weighing issue.
    Mrs. Emerson. And how soon might some information be 
available to us?
    Mr. Baker. It should be forthcoming within 60 days.
    Mrs. Emerson. Within 60 days
    Mr. Baker. Yes.
    Mrs. Emerson. Okay. I would appreciate receiving whatever 
report you all put out as soon as possible on that because my 
growers are real concerned.

                         poultry concentration

    Can you talk to me a little bit more about your personal 
concern about the level of concentration in the 
poultryindustry? Just, for example, in my district we only have one 
processor offering contracts right now and this is a huge concern to my 
folks, many of whom left grain production, for example, and row 
cropping for chickens, because they thought that they would make a 
little more money I suppose. But, needless to say, it is not turning 
out that way and they have made huge investments and are in big trouble 
right now.
    Mr. Baker. The top four firms control about 50 percent of 
the production. The top 8 or 10 firms probably account for 
about 95 percent of the production. So, it has become highly 
concentrated and there is a problem when there is only one firm 
that a grower has a choice to produce for. There are no other 
options.
    We look at poultry concentration constantly because it is 
happening throughout the Southeast. For the past four years we 
have asked for this additional money to conduct poultry 
investigations. We are asking again and I would appreciate 
strong consideration for providing the money for the poultry 
investigation area.
    Mrs. Emerson. Well, you have a little passion in your voice 
so I take it that means you are concerned about this.
    Mr. Baker. I am most concerned about it.
    Mrs. Emerson. Okay, thank you.
    I wanted you to tell me you were most concerned about it 
so, therefore----
    Mr. Baker. If you had said that earlier I would have got on 
it right quick. [Laughter.]
    Instead of beating around the bush like I have done.
    Mrs. Emerson. Yes.
    Mr. Baker. But I am most concerned with it. People with 
poultry growing contracts are selling a service. People's 
livelihoods depend on that service. You are not selling a 
product. Our people are gearing up--we are hiring and teaching 
our personnel to work with people that are selling a service 
instead of a product. But, we will need the money to get 
involved. We cannot get there with the present system.
    Mrs. Emerson. So, how much more do you need?
    Mr. Baker. $750,000 to start.
    Mrs. Emerson. And what will that do? What will you do with 
that $750,000?
    Mr. Baker. I will hire people with the expertise to get 
right in the middle of the investigations of the poultry 
companies. Those companies are large and complex and the 
investigations will take an extensive period of time. But first 
we need people that have the expertise to carry out those 
investigations.
    Mrs. Emerson. Thank you very much.
    Mr. Baker. And we have already reorganized our offices in 
Atlanta. We need to gear up that office. That money will be 
focused strictly in the poultry.
    Mrs. Emerson. I appreciate that.
    Thank you.
    And if you would like I would be glad to meet with you 
further on this because this is really a big concern to me. We 
will holler back at you.

                       mandatory price reporting

    Dr. Figueroa, I share your grave concern and that of other 
members of the committee about the high level of concentration 
in the livestock industry. And I note that you highlighted in 
your testimony the request for additional money to expand price 
reporting programs. According to your proposal, how would this 
pricing information be made available to producers and how 
timely would it be made available?
    Dr. Figueroa. Congresswoman, as you may be aware, we report 
market news on a daily basis on a number of commodities whether 
they are livestock products or fruit and vegetable products. 
The additional money that we are requesting will expand not 
only the number of reports but the size and types of reports on 
the meat products, whether they are boxed beef products along 
different parts of the market channel.
    As you also are aware, these are strictly a voluntary 
basis. We obtain this information voluntarily from the various 
entities in the market place. So, we would increase our 
outreach efforts to make sure that they would volunteer more of 
this information.
    In addition, we are interested in developing perhaps new 
methodologies on how to interpret some of the price data so 
that we can make it more user-friendly, if you will, to the 
producer of the product and he or she can use it expeditiously 
that particular day or the next day.
    Mrs. Emerson. So, it would be made available say on the 
Internet on a website or something like that?
    Dr. Figueroa. Yes, Ma'am.
    Mrs. Emerson. Okay.
    To follow-up with that, what are your feelings about making 
price reporting mandatory?
    Dr. Figueroa. The issue of mandatory price reporting is an 
issue that the Administration is supporting. I believe that the 
concentration issue, as Secretary Dunn indicated a little 
earlier, he was the chair of the Pork Crisis Task Force. I also 
served on that task force and I became directly aware of the 
crisis that was faced by all the farmers, the hog farmers in 
this country. It is a serious issue. And I think mandatory 
price reporting will address part of that problem.
    Mrs. Emerson. Well, I appreciate that having been an 
original co-sponsor of legislation to make that happen. Because 
our livestock producers are hurting big time and I think that 
is the only way to go.
    So, I appreciate that. I came in late, Mr. Dunn, so I am 
sorry I did not hear all of your testimony. Now, I have got one 
other question that I have to ask on behalf of many of my 
constituents and this goes directly to Dr. Reed.

                         invasive alien species

    This has to do with alien species. The first time I heard 
this, I really thought my constituents were joking when they 
asked me about the Executive Order. They said they were 
concerned about the fact that the President was going to sign 
an Executive Order with regard to alien species. There are a 
couple of questions I want to ask, one of which is an 
explanation of what this national management plan is that you 
all have.
    First of all, can you tell me why you all did not pursue 
this legislatively rather than through an Executive Order? And 
then I want you to tell me more about the details of this.
    Dr. Reed. I do not have an answer for you on why it was 
pursued one way versus the other. The Executive Order was 
signed on February 3, 1999. We have major concerns about pests 
that are coming into this country and need to get a handle on 
them before they get worse. Not the least of which is the brown 
tree snake, for example, that is a terrible problem in Guam. We 
are also concerned about it entering Hawaii and are conducting 
research toensure we keep it out.
    Overall this is something that we are just getting into and 
are trying to get more and more of a handle on to make sure 
that we do not have another Kudzu or another similar invasive 
species.
    Mrs. Emerson. I understand that but this national 
management plan that you all are going to be a part of--because 
I guess there are 20 Federal agencies or something involved--is 
that something that will be created that you all are in the 
design stage of?
    Dr. Reed. Yes.
    Mr. Dunn. And Congresswoman, in addition to not granting 
new authority, the Executive Order was used because there are 
so many Federal agencies that would be involved in the effort. 
It ranges from the Department of Interior, Environmental 
Protection Agency as well as USDA, and the Forest Service 
within USDA as well as APHIS. So, we see it as a major problem.
    Over the centuries there have been many alien species that 
have been introduced in the United States and it is time to 
shut the door on any new incursions.
    Mrs. Emerson. And you can understand that people are afraid 
that the Federal Government is going to come in and take over 
their private property which is understandable from their point 
of view, but I guess my big problem is that suddenly you all 
are asking for money and for us to give you all money for 
something that we have not authorized, and I just have a 
philosophical problem with that.
    Dr. Reed. If I could add, APHIS' mission is to keep foreign 
pests and diseases out, and we do it all the time for animal 
and a variety of plant pests and diseases now. We consider 
plant and animal pest and disease exclusion as one of our prime 
directives already and this continues with new pests and 
disease incursions.
    Whenever we eradicate a disease from this country, whether 
it is avian influenza or hog cholera, it then becomes an alien 
species that could enter again and devastate our producers. We 
do not want that to happen.
    Mrs. Emerson. Sure. No, and I do not have a problem with 
that. It is just the process by which this all came up.
    Thanks very much.
    Mr. Farr. Will the gentlelady yield?
    Mrs. Emerson. Yes, sir.
    Mr. Farr. Last year's research bill allowed for research 
dollars to be used for eradication of invasive species. But the 
protocol to do that requires consent by the landowner and a 
program has to be locally based. There is a concern that this 
is some kind of top-down process. It is actually just the 
opposite. A lot of communities have invasive species, not just 
affecting crops and animals but invasive species that are 
affecting the forests and the wild-lands. Partnerships now are 
being developed between local, State and the Federal Government 
to form a plan of attack. But that always requires consent of 
the landowner, whether it be a local government, a State 
government, the Federal Government or private ownership.
    Mrs. Emerson. I think your friends in California probably 
do a little bit better job doing that than in Missouri as far 
as getting the locals involved because somehow we usually find 
out about it afterwards.
    But, thank you.
    Mr. Skeen. Mr. Hinchey.
    Mr. Hinchey. Thank you, Mr. Chairman.
    Thank you, gentlemen, it has been very interesting 
listening to the testimony and your answers to these questions.
    The issue of these invasive or exotic pests seems to be one 
that is getting more and more severe as time goes on. Is that 
true in your experience?
    Dr. Reed. The jeopardy for agriculture producers is 
certainly increasing.
    Mr. Hinchey. The jeopardy is increasing?
    Dr. Reed. The jeopardy to our own producers is having a 
pest or disease that would not only close an export market, but 
would devastate an individual's production capability. They 
would not be able to grow plants or animals for some period, 
severely impacting their ability to produce revenue. These are 
some of the things we worry about. Whether it is citrus canker, 
hog cholera, or Medfly, we are interested in making sure that 
these pests and diseases are excluded and not present here.
    Production areas free of pests and diseases help us in a 
variety of ways. It helps us move agricultural products within 
the States, it helps us move products out of the country, and 
it is advantageous for us to tell other countries about how we 
control and regulate pest and disease situations. They then 
adopt a system that is similar to ours.
    Mr. Hinchey. In other words, having a program is effective 
in marketing produce?
    Dr. Reed. Absolutely.
    Mr. Hinchey. Because you can point to that program and say, 
because we have this program you are less likely to have these 
invasive pests coming into your jurisdiction?
    Dr. Reed. Yes, that can be the case, but also, we can 
certify when products leave the country that they are free of a 
pest or disease. It makes it easier to move agricultural 
products out of the country.

                        asian long-horned beetle

    Mr. Hinchey. How serious a problem is the Asian long-horn 
beetle?
    Dr. Reed. It is really a serious problem. We are glad to 
have found it but we wish it was found sooner because of the 
tree devastation. We are conducting extensive surveys to 
determine the scope and area of problem.
    Cutting down nice-sized trees is heartbreaking for 
residents, as well as for others involved. We must, however, 
grind those trees to ensure that all larva is destroyed.
    We want to eliminate the pest as soon as possible so that 
we do not have to spend more money cutting trees and then 
replacing them.
    Mr. Hinchey. Where does it come from?
    What is its origin?
    Dr. Reed. We know it came from Asia. We have found the 
larva in packing materials that came from China.

                             import/export

    Mr. Hinchey. Who has responsibility for examination and 
certifying the standard of feed that is fed to cattle or other 
meat producers?
    Dr. Reed. Generally, the Food and Drug Administration.
    Mr. Hinchey. Are you involved in that at all?
    Dr. Reed. We get involved if we suspect a tampering 
incident, along with FDA or if we suspect terrorist activity or 
an attempt to spread foreign matter or material through feed.
    Mr. Hinchey. Oh, okay, but not on a routine basis?
    Dr. Reed. No, not on a routine basis.
    Mr. Hinchey. Are you familiar with Exotic Newcastle 
disease?
    Dr. Reed. I am, indeed.
    Mr. Hinchey. And is it true that France is free of it?
    Dr. Reed. Yes, the French are free of Exotic Newcastle 
disease.
    Mr. Hinchey. Well, you recently certified foie gras from 
France for export to the United States and the reason that it 
had not been certified previously, as I understand it, is that 
there was some question about the existence of Exotic Newcastle 
disease in France. And, so, I am assuming that since you have 
recently allowed French foie gras to come into the country, 
that Exotic Newcastle disease is no longer a problem.
    Dr. Reed. Yes, that would be the criteria. Whether it is 
French foie gras or some other product, we do not want 
Newcastle in the U.S. We had a small outbreak in California not 
too long ago and we quickly eliminated it.
    Mr. Hinchey. Right. I understand that. I understand you do 
not want it and you are not going to bring it in here. But you 
recently certified French foie gras and I am just wondering 
what the basis for that decision was?
    Dr. Reed. We will receive a petition to permit the entry of 
an animal product into the U.S. Before APHIS will allow that 
product to enter, certain conditions must be met. One of the 
conditions is that the exporting country must be free of many 
diseases not in the U.S. If we are permitting foie gras, since 
it is basically an uncooked product, I can assure you that we 
are not allowing entry from France if they have Newcastle 
disease. We know there is some Newcastle over in Europe, 
though.
    Mr. Hinchey. Right.
    Can you just, not now but at some point, let me know how 
this decision came about or what the status of it is? I would 
appreciate it.
    [The information follows:]

    On November 14, 1997 we proposed a rule to amend 
regulations to declare a number of countries free of exotic 
Newcastle include France. We proposed these actions in response 
to a request submitted in July 1997 by the European 
Commission's Directorate General for Agriculture. We solicited 
comments concerning our proposed rule for 60 days ending 
January 13, 1998. We received one comment by that date. The 
comment was from a veterinary association and fully supported 
the proposed rule. Therefore, based on the rationale set forth 
in the proposed rule, we adopted the provisions of the proposal 
as a final rule without change effective December 23, 1998.

    Mr. Hinchey. In the context of a decision to allow a 
restricted product into the country, you do not take into 
consideration the effect of that decision on domestic markets. 
Is that within your jurisdiction?
    Dr. Reed. We look at it from a disease prevention 
standpoint. If product entry would cause undue risk for 
American producers, that would be reason enough for us to deny 
issuing an entry permit.
    Mr. Hinchey. Yes, okay, I understand that. But you would 
not take into consideration the fact that you are now lifting a 
ban. Say, for example, as a result of the eradication of this 
Exotic Newcastle disease, you are lifting that ban on Frech 
foie gras, therefore, allowing this product to come into our 
country. In such a case, you would not consider the effect of 
the decision on existing markets here? That is not something 
that you would examine, correct?
    Dr. Reed. APHIS would look at the economic aspect of those 
markets, but bases its decision to modify import restrictions 
on assessment of risk of exotic disease entry.
    Mr. Hinchey. Do you consult with the Commerce Department or 
anyone who would be interested in the impact on domestic 
markets when you make a decision like that or is that something 
that is done in isolation?
    Dr. Reed. Well, we usually solve the technical disease 
issues first and then the trade issues get resolved by Foreign 
Agricultural Service and USTR.
    Mr. Hinchey. But you do not consult with them with regard 
to your lifting a particular ban, say, for example?
    Dr. Reed. We do talk to the Commerce Department about 
certain policies that we put in place.
    Mr. Hinchey. I know that, but on a routine basis is it your 
policy to consult with the Commerce Department before you lift 
a ban so that you are more aware of the impact that lifting the 
ban will have on the domestic market for that particular 
product?
    Dr. Reed. In general we do consult with them.
    Mr. Hinchey. In general you do but you do not have that as 
a policy?
    Dr. Reed. We do not have a written policy to consult with 
them for agricultural trade. We do consult with USTR and other 
parts of the USDA like the Foreign Agricultural Service.
    Mr. Hinchey. Okay.
    So, when you give me that information on foie gras and 
Exotic Newcastle disease, would you tell me to what extent 
Commerce was consulted before that ban was lifted?
    Dr. Reed. Yes. We will get it for you.
    [The information follows:]

    We rarely talk to the Commerce Department about 
agricultural trade promotion. On occasion, we may work with 
them on things like the solid wood packaging rule which affects 
trade in industrial products from China. We did not consult 
with Commerce before we lifted the exotic Newcastle disease 
restriction on France.

    Mr. Hinchey. Thank you.

                                 rabies

    The situation with rabies is one that is, I think, either 
stable or becoming more serious. It depends on what part of the 
country you are looking at. But I think in the Southeast, 
generally, and running up the Atlantic Seaboard the problem of 
rabies is a problem that is increasing.
    Dr. Reed. Yes, it is becoming more serious.
    Mr. Hinchey. I understand that your budget calls for a 
decrease in oral vaccination for rabies, is that true?
    Dr. Reed. Yes, there is a slight reduction for rabies work 
in Wildlife Services operations.
    Mr. Hinchey. How do we justify that?
    Dr. Reed. We work with States to cost-share programs such 
as rabies eradication. We agree that the Eastern Seaboard is 
being plagued by increased incidents of rabies. It is moving 
Westward as well. It is becoming a very alarming problem.
    Mr. Hinchey. Well, I am just wondering since that is the 
case, based upon your testimony and my knowledge, why we would 
be reducing the amount of money that will be expended in the 
next fiscal year to control this problem when it is a problem 
that is increasing, and it is, obviously, a serious problem. It 
is one that we want to keep under control.
    I think that the budget cuts something like $1 million or 
something of that nature, $1.-something.
    Mr. Walsh. $1.8 million.
    Mr. Hinchey. Thanks.
    Dr. Reed. Congressman, it is a matter of priorities and we 
have got compelling priorities in predator control and aerial 
safety demands to protect our own people. We will continue to 
provide technical assistance in the rabies effort.
    Mr. Hinchey. Well, this is something that I suppose this 
committee might want to take a look at because our experience 
is that this is a growing problem and one that needs to be 
addressed thoroughly and completely.
    Thanks very much.
    Mr. Skeen. Mr. Kingston?
    Mr. Kingston. Thank you, Mr. Chairman.

                              wild horses

    Dr. Reed, I noticed that on your APHIS study of horses, do 
you do anything with wild horses?
    Dr. Reed. We recently signed an agreement with the 
Department of Interior to give them veterinary advice on wild 
horses.
    Mr. Kingston. Sometimes the Department of Interior and the 
National Park Service gets undue pressure from the 
environmental community about wild horses, particularly ones 
that they want to get rid of in a National Park that as not 
being indigenous to the area or something like that.
    And some of the studies can actually be tainted. Are you in 
a position to, if we request you to, to go in and look at horse 
populations, horse health and so forth in a National Park?
    Dr. Reed. Our new agreement with Interior allows us to 
examine horse health, populations, and problems associated with 
diseases. The West is becoming saturated with wild horses 
causing their movement east.
    Mr. Kingston. And would you feel that you would be a little 
more scientifically neutral?
    Dr. Reed. I feel I can be neutral. [Laughter]
    Mr. Kingston. Because so often it is very frustrating that 
horse politics seems to be, you know, almost void of science.

                                 frogs

    All right. The next question: You are aware or you have 
heard about this worldwide amphibian disappearance problem. Are 
you aware of that?
    Dr. Reed. Of the frog numbers decreasing?
    Mr. Kingston. Right.
    Dr. Reed. Yes, I am aware of the situation.
    Mr. Kingston. But I do not think it is just frogs, I think 
it is all amphibians.
    Dr. Reed. Yes, but frogs are a sentinel.
    Mr. Kingston. Does that fit in at all to your wildlife? I 
know you are studying gray foxes, you are studying raccoons, 
you are studying coyotes, a lot of it has to do because they 
are predators. But in the food chain it is possible that if 
amphibians are disappearing it could be because of pesticides 
or fertilizers, we have no idea of knowing, but does that fit 
into APHIS' game plan since there could be an agricultural link 
and the reason why I am interested in that.
    I think you guys, if there is something between fertilizer 
and pesticides and amphibian disappearance, that you need to be 
involved in it now rather than have groups that are inherently 
anti-agriculture involved in it.
    Dr. Reed. We have wildlife biologists that look at the 
bigger picture but only to a minor degree right now.
    Mr. Kingston. What would be your involvement in the minor 
degree?
    Dr. Reed. When we study wildlife, whether it is endangered 
species or predator controls, if one of their food sources 
would be amphibians, for example, that would play into a method 
of how we might control that problem.
    Mr. Kingston. Would you follow-up with our office on that 
and let me know?
    Dr. Reed. Sure.

                           poultry processing

    Mr. Kingston. Because it is something that I am interested 
in and I am ultimately very concerned about, you know, what it 
means in the world picture but also how it could impact 
agriculture and so forth.
    And, again, feel like you might be a little more 
scientifically neutral on it.
    All right. Now, poultry process and meat and poultry 
inspections. As you know from the past we have a number of 
poultry processors in Georgia and at any given time I could 
just park my car in their parking lots, all of them, and walk 
in and see the CEO or the Vice President and I can listen to 
two hours about how they are scared to death of the inspectors 
and what they can and cannot do to them and close them down and 
so forth.
    And I do not see it getting better from the times that you 
and I have dealt with this in the past. What is your view on 
it?
    Dr. Reed. I am no longer associated with the Food Safety 
and Inspection Service. FSIS is feeling a lot of pressure from 
both producers and processors. I am sure there is nervousness 
because they have instituted all these new approaches and there 
is a great deal of uncertainly about how they will turn out.
    I really would not want to comment further in my current 
position.
    Mr. Kingston. Anybody want to say anything?
    Mr. Dunn. You should probably save that for Dr. Wotecki 
when she is here.
    Mr. Kingston. Okay.
    I will. Let me ask you one other thing, though, Dr. Reed. 
If they want to complain--their big gripe is if they complain 
then vengeance will--they will pay the price down the road. If 
you have any secret--well, you do not want to share it with 
this group, I understand--but if there is any way they can 
complain without their fingerprints being on it, let me know.
    Dr. Reed. We will let you know.
    Mr. Kingston. Okay.
    Now, one other question. Having just talked to you about 
frogs, screwworms, gypsy moths, Medflies, fruit flies, long-
horned beetles and now Jack Russells trained to find brown tree 
snakes. Whoever is interested in these items, I hope that they 
are proactive because as one committee member and I can 
probably speak for all, we are sick and tired of this committee 
taking hits in Reader's Digest and in all these little reports 
where people apparently can get by without worrying about a 
good, safe food supply, who laugh and ridicule all these 
studies.
    And I hope that you tell the various networks that you work 
with, as I am doing it right now--if there are any little ears 
in the audience--they had better get off their rear ends and 
get proactive in explaining to the public why we need to be 
doing these things.
    Because frankly I think maybe it is time for us to explore 
skipping funding some of these things. You know, you have had a 
lot of success in the Medfly. Maybe we should just stop funding 
it and see what the private sector does in a year and see what 
happens.
    Or the fruit fly. You know, frankly, my folks are not real 
worried about the brown tree snake but they are going to laugh 
when they find out that you are training, with our tax dollars, 
14 Jack Russells to identify these snakes. What if they confuse 
it with a king snake, you know? That is going to be a great 
article.
    And I do not know, Mr. Chairman, I think maybe we should 
talk about skipping funding the gypsy moth every now and then 
and just see what the private sector does, see if they pick up 
the slack and if they do, good. Or boll weevil eradication 
which is very important to Georgia. But I know also that the 
State legislature is doing a lot, such as claiming credit for 
all the eradication.
    So, yes, I just think that, you know, here in the 
agricultural family, Mr. Chairman, it might be time that we 
consider stopping some of this funding for a while and just see 
what happens.
    Thank you.
    Mr. Hinchey. I see a lot of brown tree snakes in our 
future. [Laughter.]
    Mr. Skeen. Mr. Walsh?
    Mr. Walsh. I think we ought to begin with peanut pest 
research. [Laughter.]
    Mr. Kingston. Throw it on the table.
    Mr. Walsh. That was facetious. I would not do anything to 
harm peanuts.
    Thank you, Mr. Chairman.

                                 Rabies

    First of all, let me begin by associating myself with the 
remarks from my colleague from New York, Mr. Hinchey, regarding 
rabies. As I understand it, the President's budget would 
eliminate a little over $1.8 million in wildlife services under 
APHIS and the most severe impact would fall upon rabies.
    We have had to add money back each year the last two years 
for rabies eradication. During the summer almost every week 
there are reports on local television regarding rabies and 
rabies warnings and so forth. So, it is a real concern and I 
just wanted to register that.

                           Pesticide Residue

    A lot of my farmers believe that later this year EPA will 
move to cancel effective pesticides which the farmers consider 
safe, which EPA apparently does not.
    They think that the EPA will exaggerate their risks to 
justify canceling these pesticides. And the loss of some of 
these pesticides would raise the cost of production to many 
farmers and make worse the current squeeze on farm income. Have 
you discussed lately with EPA officials the need for science-
based decision making for the Food Quality Protection Act, Dr. 
Dunn?
    Mr. Dunn. What we do is provide information on pesticide 
residue, through 10 different states. And what we try to 
provide is unbiased information for employees at Ag Marketing 
Service glean that information and they make it public. It is 
information that EPA uses when they go to reauthorize a 
pesticide. It is what the chemical companies also use when they 
justify the need for that pesticide, that there is not an 
excess amount of it.
    What we try to do is remain impartial in that so that there 
is a place where people can go and get genuine scientific 
information.
    Mr. Walsh. Can you assure us that USDA takes its role 
serious enough to challenge EPA if they disagree with their 
determinations on certain pesticides?
    Mr. Dunn. Again, the determination on pesticide is an EPA 
determination. What we do is simply supply them the 
information. If they have concerns about the validity of our 
information, we will discuss that with them.
    Mr. Walsh. We have pretty much eliminated all chlorinated 
hydrocarbon pesticides, right?
    Mr. Dunn. Yes.
    Mr. Walsh. And it looks like organophosphates are soon to 
follow?
    Dr. Reed. There are still a fair amount of organophosphates 
that are used.
    Mr. Walsh. Well, obviously, any time you mention pesticides 
people cringe. They get concerned about them. But the fact is 
that there are major economic impacts to farmers, especially 
with special use pesticides that cannot be replaced. I know in 
upstate New York along the lake plain there is a lot of organic 
soils where they grow vegetables.
    There are certain pesticides that work in organic soil 
situations. In some cases, there is only one pesticide 
available to deal with a certain pest. And if you eliminate 
that pesticide, you eliminate that farmer's livelihood, because 
they may be growing onions at that time of year and the only 
way to treat a certain pest is with this chemical.
    And I remember it happened several years ago but it was a 
New York State DEC decision and we went to them and worked with 
them. We said, there is huge economic impacts on this, can we 
work through this? Because it was not a real strong 
recommendation that they made. They said, well, this has got to 
go because we believe such and such.
    It would seem to me that, obviously, the public and the 
public health have to be held in the highest regard. There is 
no question about that. But a lot of these pesticides have been 
licensed and used for many, many years in a safe and effective 
way. And I would just urge you in your consultatory role with 
EPA to protect that interest of the farmer, of the producer and 
ultimately the consumer. I do not think they are in opposition 
to each other but a balance has to be struck. And if you 
eliminate a whole family of pesticides, you better have 
something to replace them.
    Could you explain how the pesticide data program works?

                         Pesticide Data Program

    Mr. Figueroa. Gladly, Mr. Congressman. We have 
approximately 10 States in the program that we have entered 
into cooperative agreements for the State labs to do the 
testing of the products that we develop a protocol for. Those 
10 States represent a scientifically-defensible cross-section 
of produce.
    Produce is collected at either wholesale distribution 
centers or supermarket warehouse distribution centers. Random 
samples are selected. We test for pesticides that the EPA, FDA, 
and we arrive at; a set of pesticides that are in need of being 
tested for. The data is submitted to our central offices here 
in Washington and compiled and we issue an annual report.
    Mr. Walsh. What is the objective?
    Mr. Figueroa. The objective of the PDP program is to have a 
scientific, statistically-defensible sample of what is actually 
on this basket of produce--in addition it includes milk and 
grains and some other products--over time. So that anyone that 
is interested in making a determination of what is actually in 
the marketplace, we have that data available for them to make 
that determination.
    Mr. Walsh. How many States participate?
    Mr. Figueroa. There are currently 10 States in the program.
    Mr. Walsh. What do we need to do to get everyone involved?
    Mr. Figueroa. I could not give you a dollar figure on that, 
Congressman. I am willing to----
    Mr. Walsh. Is it a question of funding?
    Mr. Figueroa. The 10 States that are currently in the 
program are representative of the national basket, if you will. 
There is enough product tested in enough diverse areas that we 
feel that it is a representative sample of what actually is 
transpiring across the country.
    Mr. Walsh. And the agricultural practices are equally 
accepted in all those areas? In other words, what apple growers 
use in Washington State is what apple growers use in New York 
State?
    Mr. Figueroa. We are testing when the product is already in 
the marketplace. So that we are actually trying to get a sample 
of what actually the consumer is going to consume. In fact, 
when we do the testing of apples, for example, the apples are 
washed because we are assuming that most consumers will wash 
their apples. Then we do the grinding and the testing for the 
pesticides.
    Mr. Walsh. What role does this data play in EPA's pesticide 
registration program?
    Mr. Figueroa. The role that it plays is that they will have 
direct data on exposure. They can use the pesticide data and 
infer that an average consumer consumes X number of pounds of 
apples. The data program provides how much pesticides are 
available in that apple or on that apple, and they can then 
develop the kind of exposure and risk assessment with regards 
to the various commodities and pesticides.
    Mr. Walsh. That was my next question. Is this data then put 
to use in developing risk assessment?
    Mr. Figueroa. Yes, it is. I might add, Congressman, that we 
do random samples so that we capture both domestic product as 
well as imported product.
    Mr. Walsh. And you can identify both?
    Mr. Figueroa. Yes, we can.
    Mr. Walsh. As domestic or foreign?
    Mr. Figueroa. Yes, sir.

             farm animal identification and records program

    Mr. Walsh. My last questions are for APHIS. Over the last 
several years I have worked fairly closely with dairy and 
livestock groups to provide funding for a farm animal 
identification and records program, FAIR they call it. It is a 
plan that is designed to lead to the creation of a unified 
system of animal identification to serve the needs of animal 
health and disease control, food safety, herd management, breed 
production, genetic advancement.
    How much progress is being made toward the creation of a 
national livestock identification system, and when do you 
envision such a system being fully operational?
    Dr. Reed. We have a report--you may have the same report--
on the need to have a national system. A method of national 
identification in the past has been brucellosis ear tags. With 
less need for brucellosis vaccinations in many States, this is 
no longer a viable identification.
    All of the people involved in the livestock industry 
support the need for livestock identification to isolate a pest 
or disease problem, trace it back, and eliminate it rather than 
using a less effective and efficient shotgun approach. We can 
obtain animal health information based on a sound national ID 
system.
    We are getting closer, but we are not there yet. We are 
exploring several ideas from livestock producers on the best 
way to establish permanent identification.
    Mr. Walsh. So there are sort of competing proposals on how 
to approach this?
    Dr. Reed. There are a variety of ideas on the table. 
Everybody agrees that there is a compelling need for animal 
identification, especially if we have a pest or disease 
outbreak. We can then respond positively to questions from 
other countries about a disease outbreak and know it is limited 
to a certain area.
    Mr. Walsh. Thank you. Thank you all.
    Thank you, Mr. Chairman.
    Mr. Skeen. Thank you.
    Ms. Kaptur, we are going to go--this is only the start of 
the second round. Let's keep it to about two questions.
    Ms. Kaptur. Mr. Chairman, I was going to ask our guests if 
they wanted to stand up just for a two-minute break.
    Mr. Skeen. I am afraid they might fall over, they have been 
sitting there so long. We appreciate your endurance.
    Ms. Kaptur. Are you doing all right out there?
    Mr. Skeen. Ms. Kaptur.

                            strategic goals

    Ms. Kaptur. Thank you. Under Secretary Dunn, I just wanted 
to point out to you something I mentioned to the 
representatives from Agricultural Research Service yesterday. 
That is as I look at your strategic goals for marketing and 
regulatory programs, what continues to surprise me in many of 
the agency divisions' descriptions of their strategic goals 
there are many priorities, consumers, workforces, customers. 
But the word that is always missing is farmers.
    You use--the term in here is producer, which is an 
interesting word. But I hope that does not--sometimes words 
really do tell us where people's minds are. So I just point 
that, to me, glaring omission out to you, in hopes that as you 
go back and talk about what it is you actually do, that farmers 
might get some attention in the most high-level goals that you 
establish as a part of USDA.
    Mr. Dunn. Congresswoman, you have a good point in that we 
sometimes fail to realize why we are here. It is for family 
farmers throughout this Nation. That is one of the primary 
reasons why we are here, why we have a Department of 
Agriculture.
    In our annual workplan, all three agencies have stressed 
this year, because Secretary Glickman has asked us to, family 
farmers. The Secretary had a commission on family farmers. In 
each agencies' annual workplan, special segments explain how 
they relate to family-size operators, and how we can assist in 
keeping them in business. We need to rededicate ourselves to 
helping family farmers every day.
    Ms. Kaptur. Do you have any explanation of why even the 
words are missing from your strategic goals?
    That is a hard question. I really put you on the spot 
there. You do not have to answer it. I made my point.

              sanitary phytosanitary standards management

    I wanted to ask Dr. Reed, if I might. We talked a lot about 
the import of pests and bacterium into this country from other 
nations. As you look at what we are accused of globally, is the 
level of concern as great among our trading partners with what 
is exported out of here? Or would you say that the level of 
concern is greater based on what comes in here?
    Dr. Reed. I would characterize the concern it as about the 
same. People who receive our exports are very cautious, whether 
it is pork going to Japan, or wheat going to Italy. There are a 
variety of pest and disease concerns on both sides so we must 
make sure that what we certify is what we deliver and vice 
versa.
    Ms. Kaptur. Is that generally true, that what we certify 
is--what we deliver has been certified and that we do not 
create the same kind of problems elsewhere, our exports, as 
imports coming in here? I know the level of concern is the 
same, but I am saying in fact with what happens with the 
deliverables, how well do we present ourselves in the countries 
in which we sell our product?
    Dr. Reed. We do an excellent job because we know that if 
they find a pest or disease problem, they are going to close 
the export market for us.
    Ms. Kaptur. Have we exported citrus canker anywhere?
    Dr. Reed. I doubt it, because we have been containing 
spread through regulatory actions and surveying for it in 
commercial groves to prove free status before we export the 
citrus.

                              karnal bunt

    Ms. Kaptur. What about Karnal bunt?
    Dr. Reed. We always have been worried about Karnal bunt. We 
do not want Karnal bunt to spread to free areas.Countries that 
receive our wheat are testing and examining for spores. That is why we 
look so hard here, to ensure we deliver a product that is disease free. 
If we do not, we are going to lose foreign markets for our agricultural 
products.
    Ms. Kaptur. On the Karnal bunt problem we had a couple 
years ago, was that not the first time that had been detected 
within our borders?
    Mr. Dunn. Correct.
    We had never had it before.
    Dr. Reed. Arizona was the first time it was detected in the 
U.S.
    Ms. Kaptur. It was the first. That is what I thought. On 
page 1417 of the budget that you submitted in the large budget 
book there is a line item for Karnal bunt CCC $16.273 million 
in 1998, and there is a carryover through that year, and there 
are no additional--it says, available for 1999, $2.9 million. 
Could you kind of summarize where we are on the Karnal bunt? I 
thought we had closed that down? Are we still expending funds 
to remediate that?
    Dr. Reed. We still have survey and control programs for 
Karnal bunt restricted areas in four States. We are proposing a 
new regulation that we expect to be out this coming week to 
inform producers of the remaining regulated areas.
    Ms. Kaptur. From which nation did we trace that Karnal bunt 
appearance in our country?
    Mr. Dunn. We did not.
    Dr. Reed. We do not have any specific information.
    Ms. Kaptur. Was it windborne?
    Dr. Reed. We believe it was from Mexico, but can not be 
sure.
    Mr. Skeen. New Mexico has a quarantine in the southwest 
corner. The premise is that it came out of Mexico through 
Arizona and into New Mexico.
    Ms. Kaptur. As I asked on the beetle issue, could you 
present us with the total amount that we have spent in trying 
to eradicate and remediate against the Karnal bunt? Just 
ballpark. If you could submit that for the record I would 
appreciate it. And I take it that we have not discussed this 
with the government of Mexico, have we? Maybe they are 
remediating along their northern border. Do you know that, 
Secretary Dunn?
    Mr. Dunn. We have not discussed any funding with Mexico on 
Karnal bunt. They have Karnal bunt in Mexico and have 
established quarantines similar to ours. Since 1996, we 
estimate spending about $67 million on Karnal bunt through this 
year.
    We distributed about $33 million of the $67 million 
compensate to producers for losses that they have incurred 
because of the existence of Karnal bunt. We still are incurring 
costs to maintain quarantine areas. We then are able to assure 
our trading partners that when they buy wheat from the United 
States, we can provide a phytosanitary certificate that 
indicates this wheat comes from an area free of Karnal bunt.
    Ms. Kaptur. So our sales are--it has been all right?
    Mr. Dunn. We have retained 98 percent of our sales that we 
had before our find of Karnal bunt here in the United States.
    Ms. Kaptur. I think that was due to your quick action as a 
department also. I want to compliment you on what was done 
there. That was really a terrible development.
    Mr. Dunn. It was many fine men and women in APHIS, but 
State Governments as well worked very, very closely with us on 
that.
    Ms. Kaptur. Very good. I am glad to hear that wheat sales 
are okay. I had not been given that figure before so I 
appreciate that for the record.

                    sanitary phytosanitary standards

    On page five of Dr. Reed's testimony you talk about 
American agricultural producers last year shipping over $55 
billion worth of products to overseas markets. Do you also have 
the number of--I know you are not the Economic Research 
Service, but the amount of imports now coming in here and the 
rate at which those are increasing, which affects your life 
very much?
    Dr. Reed. I can get the exact figures for you, but we still 
maintain an overall balance of around the $10 billion to $15 
billion mark of getting a product out more than we take it in.
    [The information follows:]

    In 1998, we imported about $37 billion worth of 
agricultural products so we still maintain an overall balance 
of around $17 billion. In 1996, the balance was more favorable, 
about $28 billion, but a combination of weaker exports and 
increased imports has reduced the balance today.

    Ms. Kaptur. That is true. But of course, the rate of growth 
is what is very significant in both those lines. I would just 
commend that to your attention. And there seems to be some 
aversion--I do not know why this is. In our country, we 
always--in every single Administration document that comes up 
here, we always talk about the export side of the equation. I 
am all for that.
    But it is just a glaring hole that we also do not report on 
the imports. And in the area of agriculture, this is very, very 
important. In some ways, it would support your arguments for 
more funding to do some of what you need to do. But those 
dollars are never reported. Those quantities are never 
reported.
    We follow them pretty regularly up here because of our 
interest in our national interest. But it is always interesting 
to me to look at testimony and to see what is in and what is 
not in. So I just wanted to make that observation.

                          PACKER CONCENTRATION

    I wanted to ask for further clarification, either verbally 
or for the record, of Mr. Baker on how your budget addresses 
the concerns regarding concentration that others on this 
committee also talked about today, and is anything being done 
to expand your investigatory ability in the budget submission?
    Mr. Baker. The budget asked for additional funds to address 
concentration; specifically concentration. We are sending 
forward a bill to amend the Packers and Stockyards Act to cover 
poultry under our administrative authority. We feel that we 
need to have administrative authority for poultry. It is pretty 
hard to have the responsibility and not the authority.
    So we are asking for administrative authority that would 
place poultry under the same authority that the other meats 
have, and our budget is structured around that.
    Ms. Kaptur. All right, I thank you for that.
    Secretary Dunn.
    Mr. Dunn. Congresswoman, I think we and the Nation owe this 
committee a vote of thanks for the $2.5 million that was made 
available last year as a one-time cost to restructure packers 
and stockyards, to allow us to get more people out in the 
countryside to actually do the business, to look at 
concentration issues out there. We went from having 72 percent 
of the people in the field to 80 percent of the people in the 
field. We now have three regional offices set up, one 
specializing in poultry, one specializing in swine, and one 
specializing in beef and lamb. So that we are getting the 
expertise where we need to have it.
    We do have requests for looking at competition, and 
requests for poultry. Again I reiterated what I said in my 
opening statements, the single biggest factor that could help 
us is having that money available for the electronic filing of 
information so that we can get that information from packers. 
It will not be a burden on them if we can do it electronically. 
They can tally up at the end of the day and let us have that. 
That would give us the type of information we need to be able 
to tell the world what is happening out there.
    Ms. Kaptur. You certainly have my support on that. You 
reminded me, I wanted to compliment Mr. Baker. After he 
traipsed through northwestern Ohio last year I asked his 
assistance in another area, which was to try to get up on a web 
site at USDA in the area of contract farming, helpful questions 
for farmers. I do not know who did that. Congratulations. It is 
a fine, fine, fine job.
    Farmers can really benefit by reading through that, and you 
give them other references. Where you cannot put a sample 
contract, for example on there, you refer them to Iowa and 
other places. But honestly, it was just excellent.
    Mr. Baker. There was a need for that.
    Ms. Kaptur. We thank you very much for that, and we hope we 
save a few of them out there by just access to better 
information.

                            DIRECT MARKETING

    I wanted to ask Dr. Figueroa, I have been a long supporter 
of farmers' markets, and the Secretary has been really helpful 
on that. I wanted to ask you, if you could comment, how well 
you work with the rural development part of your department, 
particularly Under Secretary Long-Thompson, to find other ways, 
economic ways for farmers to arrange their own production or 
their own marketing of product, to find outlets to market.
    I was listening to Mr. Baker when he was talking here about 
people bidding so much on animals, $7 or $5 or $3 or whatever 
it was and how the transparency was not necessarily there in 
the marketplace for the farmer. But as I recall hearings in my 
area people were saying, hey, we can produce a quality product, 
but the auction barns and the market does not request quality; 
does not respect our quality. That is what they were saying to 
us.
    Our problem is getting to the market. Our problem is how we 
organize ourselves as groups of smaller producers to reach the 
market. And when they have a very little narrow, eye of a 
needle to pass through to get to the market, it is very 
difficult for them.
    So my question really goes, to what extent is the marketing 
service looking at ways for farmers to bond together or to work 
together, whether it is through a marketing co-op or through 
the credit support for an expanding small slaughter facilities 
that might be out there to permit them to actually bring 
product? It is the same problem we have now if we are going to 
buy extra product to try to relieve the surplus that is out 
there in the low prices, who are we going to go to to buy those 
hogs or buy those cattle, and how do we reach them as the 
Government of the United States? Who is going to end up being 
the seller?
    So I am curious as to how much work you are really doing to 
try to find ways to help lead these farmers to market in non-
traditional channels.
    Mr. Figueroa. Congresswoman Kaptur, I will make available 
to your office a copy of a direct marketing action plan, or a 
strategic plan that was developed under the leadership of Under 
Secretary Dunn and my staff in marketing and transportation. 
You will see in the plan where it includes a number of 
initiatives that we want to pursue to address not only farmers' 
markets but other channels of direct marketing. It establishes 
there a council, if you will, that includes individuals such as 
you mentioned, Jill Long-Thompson.
    So that there is more of a coordinated effort within the 
USDA to try to develop more comprehensive approaches to 
innovative solutions for direct marketing venues and 
opportunities for farmers in this country.
    Ms. Kaptur. I am very, very glad to hear that. To the 
extent you can provide any of that information for the record I 
would very much appreciate that.
    Mr. Figueroa. We will do that.
    [The information follows:]


[Pages 541-558 -- The official Committee Record contains additional 
    material here]

                             concentration

    Ms. Kaptur. Mr. Baker, I wanted to ask you, the Baltimore 
Sun has been running a series on contract farming in our 
country and I am wondering, you had talked about the additional 
authority that you need and I am very sympathetic toward that. 
Do you think--we know in the hog area and in the poultry area 
people are heavily impacted by this. Do you see other areas 
coming on stream, even though they may not be under your 
authority, that are also going to be impacted in a like manner?
    Mr. Baker. Not really. We have the authority in other areas 
already. We do not have the authority in poultry. That is a 
limiting factor.
    Ms. Kaptur. But in fruits and vegetables, you do not see 
the same----
    Mr. Baker. I see grains and fruits and vegetables and all 
being more of a concentrated effort, grown under contract. I 
think we will see----
    Ms. Kaptur. Dairy?
    Mr. Baker. I doubt that the dairy will follow as fast as 
the grains because the grain industry is shifting to the source 
of the GMOs, and they are going to want to control that, the 
GMO. So there is going to be more contract farming in the 
grains. But it presents a problem when you are dealing with 
contracts versus open market, and a tremendous problem in 
regulating it when you have got a contract versus open market 
bidders.
    It is difficult for us, but what we are really interested 
in right now is the poultry authority because we have it in the 
livestock, cattle, pork, and sheep areas.
    Ms. Kaptur. You reminded me of something. Ohio is now the 
largest egg producer in the country because of Buckeye Foods. 
It used to be called, I think, AgriGeneral, a company out of 
Germany. What has happened in Ohio, and I am sure this is 
happening in other places, Kroger, which is one of our largest 
retail chain supermarkets, used to buy eggs and chicken from 
many of our local producers. Now what has happened is, all 
those locals have disappeared off the shelves and you are 
seeing the very large, industrial firms, like Buckeye Foods, 
supply the majority of eggs on the shelves in communities like 
ours.
    If you think about marketing, Dr. Figueroa, and some of the 
other initiatives that you are involved in, I hope you will 
give a serious talk to some of the retail chains and find a way 
to help some of our smaller producers find their way to market. 
Because truly, they are not on the shelves any more.
    Mr. Dunn. Congresswoman, Secretary Glickman has asked us to 
put together an agency-wide task force to look at the 
concentration of various issues. And it is all the way from 
transportation issues to concerns that Mr. Baker had 
articulated.
    What we are finding is that there are some things within 
our jurisdiction and some things that are not within our 
jurisdiction. For instance, on the Cargill proposed takeover 
for Continental on the grain industry, that was one that maybe 
FTC or Justice should have authority over. So we had spent a 
great deal of time talking to those two agencies about what we 
have spotted out there, to share the information with them.
    When you get into the retail sector, this is an area which 
FTC has jurisdiction over. So we can take it up through perhaps 
the wholesale side, but when we get into the retail side then 
we lose jurisdiction over that. But certainly, there are a lot 
of concerns that we hear from many people about slotting fees, 
et cetera, that they have to pay in order to shelf space. And 
if you do not have the shelf space, you cannot sell.
    Ms. Kaptur. All right. I thank you very much and I 
appreciate your advice there. I also appreciate the indulgence 
of my colleagues.
    Mr. Skeen. Mr. Boyd.

                          International Trade

    Mr. Boyd. Thank you, Mr. Chairman. Just a couple of quick 
questions. First, I want to follow up on the line of 
questioning and the comments by my friend from Ohio regarding 
the import versus export balance, the trade balance, the 
agricultural balance, which traditionally in this country has 
been the major industry that has softened the deficit in our 
trade balance. I recently read a summary of Secretary 
Glickman's speech that he gave sometime in the last week where 
he was predicting that that trade balance in agriculture would 
be narrowing.
    In other words, the surplus in that balance would be 
getting smaller. Does anybody care to address that, maybe Mr. 
Dunn or----
    Mr. Dunn. That was, I believe, Congressman Boyd, the 
Secretary's speech at the Outlook conference that took place a 
week ago. And he talked about what has happened here as some of 
our trade partners, primarily the Asian market we have seen a 
tremendous collapse. Two years ago we had about $60 billion of 
international trade. This year we may be down below $50 billion 
in international trade, and that gives us a great deal of 
concern.
    There is also a weakening of some of our trade partners in 
South America that will not be able to purchase some of the 
commodities that we had sold to them in the past. That is of a 
great deal of concern to the Secretary, and something that he 
is asking us to take a hard look at and see if we can get back 
on track.
    Now I think there are some silver linings in there. I was 
over to Asia not too long ago, the beginning of the year, and 
what I was told was that our share of the market there has 
grown, but the overall market has shrunk. The pie has not 
gotten bigger, but our slice of the pie has gotten bigger. So 
hopefully when that Asian economy comes back we will be in 
place to be able to get back to where we were before.
    But there is really a very--I do not want to say 
pessimistic, but it is going to take us a while to get back to 
where we were a short two years ago.
    Mr. Boyd. Pessimistic, I agree with that. What we all fail 
to talk about is our exports, that the export side--and this 
is, I think, the point Ms. Kaptur was trying to make. The 
imports continue to grow, our exports do not, and that creates 
significant problems for our producers. Not only economic 
problems, but problems for some of your activities too.

                               screwworm

    Now Mr. Bonilla asked a question earlier that I really did 
not catch the whole gist of. But as a person who maybe, besides 
Chairman Skeen, the only person in this room that ever treated 
screwworms in livestock. I want you to clarify: We are not at 
any risk in our livestock industry of this pest now, are we?
    Dr. Reed. We are always maintaining vigilance for it. We do 
not have screwworm here. We had a find in the one goat that we 
eliminated very quickly. We know there are screwworms in 
Central America. We have a program there to eliminate the past 
and keep moving its presence southward so it is not an 
immediate threat for U.S. producers.
    Mr. Dunn. Mr. Boyd, we are at risk. We have also had a 
screwworm find in a dog brought back from Panama. We also had 
an individual that had visited Brazil and had a screwworm 
imbedded in his scalp. So we are at risk. We cannot afford to 
drop our guard.
    We need to finish the eradication program going to Panama 
in the next two years to build a sterile rearing facility there 
so that we can have the barrier at the isthmus of Panama. I 
would hope that our friends on the subcontinent would also take 
a look at what they can do to get that out of our hemisphere 
altogether.
    Mr. Boyd. Thank you. As the chairman I am sure can attest, 
the screwworm an ugly, ugly pest. For everyone involved, since 
we eradicated it--35 years ago, there has been all kinds of 
pluses. Not only for the livestock industry, but for the 
wildlife industry. We have a resurgence of wildlife population, 
I know at least in the southeast and I am sure all over this 
country, particularly among the deer population that has 
created a whole new industry in itself. So this thing is 
broader than just cows, and sheep, and goats, and hogs. I just 
wanted to make sure that everybody understood that.

                             hog production

    One final question, and maybe Mr. Baker you can answer 
this, or either Dr. Figueroa. Regarding Hog production in this 
country, are we quickly going to the same production model that 
exists now in poultry where it is going to be integrated and 
all controlled by--just a few large companies. They are all 
produced for--and I do not want to name names, but we know who 
they are, three or four large poultry guys. I mean, do we have 
numbers? Do you all have statistics that show that we are 
moving in that direction with our hog production also?
    Mr. Baker. The statistics will show that it is getting to 
be more contract growing of hogs in this country, yes. Contract 
growing similar to what the poultry industry is doing where a 
supplier furnishes you with a product, your management and 
facilities are at risk.
    Mr. Boyd. Has the Department taken any position about the 
development of that concept and whether it is good, bad, or 
indifferent? I know, again, it is a private sector matter, but 
nevertheless, it is--I mean, this Government has a history of 
maintaining or making sure that we maintain a strong economy. 
Do you have any thoughts on that, or does the Department have 
any thoughts on it or any position?
    Mr. Dunn. I think, Mr. Boyd, that is of grave concern to us 
of who is going to be out there and who is producing. A few 
years ago people used to say, we keep this way we are going to 
end up with only one farmer out there and one processor, and 
they did it very jokingly. But if you look at the situation 
with Murphy Farms, if there were 18 Murphy Farms out there, 
they would cover that whole commodity, and that is all you 
would need.
    So it is something of a great deal of concern. It is 
something the Secretary has asked us to look at, and it is one 
of the reasons why we think we need the additional funding for 
packers and stockyards so that we have the economists and the 
statisticians there to enter into this next millennium with the 
resources that we need to find out what is happening before it 
happens.
    Mr. Boyd. Mr. Chairman, you know the way it is in my area 
of the country where we used to have small hog producers all 
over the countryside, for many of them, that is their sole 
income, and others, supplements their income. It just does not 
exist any more. I want you to know, Mr. Chairman, and members 
of the panel, that I am somewhat concerned about that trend in 
our pork production.
    Thank you.
    Ms. Kaptur. Will the gentleman yield? I did not quite 
understand your point, Secretary Dunn, on the 18 to one ratio. 
Could you clarify that?
    Mr. Dunn. What I said is that if there were 18 Murphy Farms 
out there, they would be able to supply our entire need for 
that commodity. When we used to have 2 million farmers out 
there--in my part of the country in Iowa where we used to have 
what they called the mortgage burners, the hog operations out 
there. What used to be a large operation, any more is a small 
operation. And what used to be considered a mega-operation is 
now a family-size farm. So there is a definite trend.
    Mr. Skeen. Mr. Farr.
    Mr. Farr. Thank you very much, Mr. Chairman. I know it is 
getting late and I appreciate your indulgence. There is an 
interesting theme that is developing here and I want to comment 
on it and ask some questions. Jim Walsh started it and Ms. 
Kaptur picked up on it.

                            export promotion

    It seems what we are doing in America is providing a lot of 
resources to regulate agriculture in this country, to regulate 
the management and restriction of herbicides and pesticides, to 
inspect etc. Yet we allow countries to import goods that do not 
face the level of regulation that domestic goods face. If we 
keep going this way we are going to end up not growing any food 
in this country, we are just going to import it all, because 
the cost of doing business is going to be too great in America.
    One of the things that I am really concerned about is 
health and safety. We all support the idea that we ought to be 
better informed and use smarter and safer products and support 
the registration process. But at the same time, we give the 
determining authority to another agency, EPA. I have often 
found that they do not have any deadlines. They can do more and 
more studies while avoiding the need to come to a conclusion.
    When I was in California what we did is we put limits of 
time, saying that if you did not do something within a 
reasonable amount of time--then it was deemed approved. And 
that really started moving things.
    I think that your department needs to come back and suggest 
to this committee that we may need to have some of those 
timelines in the extra-regulatory agencies whodo not really 
have to make it a high priority within their budget process to get 
these things done.
    In order for us to get our product abroad and market our 
product, obviously we have got to sell--we only have 3 percent 
of the world population and we grow most of the world's food. 
We cannot consume it all. We have got to export.
    We lend money through the export promotion to do 
advertising. But we need more than that. We need technical 
hustlers. Ms. Kaptur talked about the idea of getting farmers 
more access to market information. I think that we could do 
that on computer.
    I know the California World Trade Commission has given 
California farmers essentially a laptop software marketing 
strategy. So if you grow strawberries and you want to wake up 
in the morning and say, who in the world wants to buy my 
strawberries today, you can look up every country in the world 
that buys them and what the protocol is for getting them to 
market. And then find what the price is and make your decision 
of whether you want to sell domestically or to foreign buyers 
that day. We need to do more of that in America to give our 
farmers access.

                   sanitary phyto sanitary standards

    What proportion of the APHIS budget is allocated to working 
on projects where U.S. industries are asking APHIS for 
assisting in working with foreign governments to open up new 
export markets?
    Dr. Reed. I will have to get those numbers for you, 
Congressman.
    [The information follows:]

    Almost 4 percent or about $16 million is spend directly on 
export--related SPS issues. This includes issuance and review 
of export certifications, bilateral negotiations with trading 
partners, risk assessments, and participation in international 
trade and SPS standard-setting organizations.

    Mr. Farr. How do you allocate staff resources to this?
    Dr. Reed. On the import sides, we have a number of 
countries that petition to ship us products. Of course, we will 
examine these products to determine their eligiblity for 
import. There is some staff time that goes to determine pest or 
disease risks.
    On export, we do the same thing. We work on behalf of a 
commodity producer or an exporter. When there is an interest in 
a foreign market and there is a technical issue, a sanitary or 
phytosanitary issue, then APHIS ensures that we can meet SPS 
needs of the importing country. So there is effort both ways.
    It depends on the product to be exported. APHIS does not 
promote exporting products that people do not have an interest 
in exporting. By the same token, when a producer asks for help, 
we assist in resolving any SPS issues.
    Mr. Dunn. Mr. Farr, In the past, a GAO report indicated 
that we do not do enough coordination of sanitary, 
phytosanitary issues between the Department of Agriculture, 
USTR, and other entities.
    So we met with USTR and developed thresholds to determine 
our involvement in sanitary and phytosanitary issues. USTR 
published a list of these thresholds about two or three months 
ago. The whole world knows our involvement regarding SPS 
managment issues.
    But one of the primary drivers is that is the industries' 
requests.
    Mr. Farr. How many export projects are currently in the 
pipeline?
    Dr. Reed. There are about 56.
    Mr. Farr. Is the time allocated to assisting U.S. 
industries more or less or equal to the amount of time that is 
devoted to assisting foreign governments who wish to import, or 
wish to export to us?
    Dr. Reed. I do not have a good answer for you on that one. 
But what I would submit would be that if there is producer 
interest, whether it takes a little time or a lot of time, we 
are going to support that producer request to move product into 
a foreign market.
    [Subsequent to the hearing, the agency provided the 
following:]

    I estimate the time we spend on export work is four times 
greater than the time we spent on import work.

    Mr. Farr. What do you do when you have got to determine 
where to put these resources? Do you put resources into making 
sure that we are not losing export markets? For example, when 
there has been an infestation of flies or other pests 
identified in the United States, how do you calculate the 
resources assigned to work with foreign governments so that 
they understand the nature of the problem in the U.S. and do 
not overreact to such a pest problem?
    Dr. Reed. We have two mechanisms. If we have a reportable 
pest, we must notify the country receiving our product about 
the pest discovery. And, many times, we can also tell them that 
we have quarantined and delimited an area and that only certain 
products will come out of that area so we can keep that expert 
market open.
    Mr. Farr. Do you dedicate staff to making sure that market 
share is not lost, that a niche is not lost?
    Dr. Reed. Oh, yes. We will get you the numbers on that.
    [The Information follows:]

    We have over 200 staff years devoted to risk assessments 
and bilateral negotiations with trading partners to maintain 
markets.

    Mr. Dunn. Mr. Farr, the Karnal bunt that we talked about 
earlier is probably a good example of maintaining wheat 
exports.
    Mr. Farr. That is a good example because it is a huge 
export market.
    Mr. Dunn. It is a huge export market. In the case of Karnal 
bunt APHIS' International Services employees stationed 
worldwide began talking to scientists and technicians in other 
countries so that they understood our situation. Using our 
protocols, we established quarantines and conducted a 
nationwide survey to ensure that bunted kernels did not get 
into shipments that went outside the United States.
    Then we also used our Foreign Agricultural Service 
employees located in all of the embassies to ensure that the 
ambassadors and their staffs were well aware of what actions we 
were taking, so that it was a dual approach. We went to the 
scientists, we went to the technicians, and then we went to the 
policy people as well.
    Mr. Skeen. Could I ask the gentleman to----
    Mr. Farr. Yes, this is concluding.
    Mr. Skeen. Thank you.
    Mr. Farr. Wheat is huge. I understand APHIS sent a letter 
to the minister of agriculture in Japan almost a year ago 
concerning the phytosanitary standards for lettuce and 
requesting changes to the restrictions. Has there been any 
response to your letter?
    That is a year ago. This is why I am asking about 
dedication of personnel to follow through with these things.
    Dr. Reed. We are continuing to follow that issue closely. 
We are engaging in bilateral talks on that commodity.
    Mr. Farr. It takes over a year on one commodity just to 
answer some questions?
    Dr. Reed. Sometimes it takes many years.
    Mr. Farr. Are you going to more forward on any action in 
the WTO if they do not respond?
    Mr. Dunn. That is one of those decisions above our pay 
grade, unfortunately. I was over in Japan early last spring and 
we talked about this very issue; this as well as tomatoes, 
various varieties of tomatoes. At that time, the Japanese did 
not have enough time, enough personnel to work on lettuce 
because they were fighting us on varietal issues on apples that 
were going in there.
    We are now seeing Japan going back to the table and sitting 
down and talking to us about the phytosanitary issues on 
scientist to scientist, technician to technician basis. But 
again, they lack resources, both human and fiscal, the same as 
we might.
    Mr. Farr. Yes or no answer. Do you support origin labeling?
    Mr. Dunn. Me personally?
    Mr. Farr. The Secretary.
    Mr. Dunn. There are a number of issues involved with that. 
If it comes down to a consumer's right to know, I personally 
would support it.
    Mr. Farr. Thank you.

                              karnal bunt

    Mr. Skeen. Thank the gentleman. I think that it is time to 
wrap this up and I would just like to ask one question. Has the 
Karnal bunt moratorium on planting wheat in the quarantine 
zones in southern New Mexico been lifted as of March 1, Dr. 
Reed?
    Dr. Reed. It is not going to be entirely lifted. We are 
going to have to go field by field.
    Mr. Skeen. I understand that you are going to do the 
inspection. Thank you very much.
    I want to thank all of you for your responses, and thank 
you for the time and all of the effort. If you want to worry 
about the flies we used to have so much trouble with, you will 
never eat rice pudding again. [Laughter.]
    With that wonderful thought, I will leave it to you. Thank 
you all very much. We have questions we would like to give you, 
Mr. Dewhurst, to respond for the record. Thank all of you very 
much.
    [The following questions were submitted to be answered for 
the record:]


[Pages 567-987 -- The official Committee Record contains additional 
    material here]



                           W I T N E S S E S

                              ----------                              
                                                                   Page
Baker, J. R......................................................   359
Dewhurst, S. B...................................................   359
Dubey, A. M......................................................     1
Dunn, M. V.......................................................   359
Figueroa, Enrique................................................   359
Kaplan, Dennis...................................................     1
Lyons, J. R......................................................     1
Reed, C. A.......................................................   359
Reed, P. S.......................................................     1
Sells, D. R......................................................     1


                               I N D E X

                              ----------                              5--
--------

                 Natural Resources Conservation Service

                                                                   Page
Additional Assistance............................................    45
Administrative Service Estimates.................................   160
Administrative Tasks Minimization................................   142
Adopted Ordinances of Best-Use Practices.........................    55
Ag Drainage Wells:
    Capping of Ag Drainage Well in Clean Water Action Plan (CWAP)    69
    CWAP and Ag Drainage Wells...................................    69
    Drainage Wells in Iowa......................................67, 183
Agency Priorities................................................    70
Aging Watershed Structures.................................44, 173, 189
Air Quality Compliance...........................................   157
American Heritage Rivers Initiative:
    Funding for FY 1998 and FY 1999..............................   121
    Initiative...................................................    59
Animal Agriculture and Production Concern........................   122
Animal Feeding Operations:
    Economic Analysis............................................    49
    EPA Budget Request...........................................    62
    Listening Sessions...........................................    50
    Release of Strategy..........................................    57
    Responsibilities.............................................    69
    Status of Joint Strategy (with EPA)........................180, 189
    Strategy.....................................................    48
    Technical Assistance.........................................   135
    Workload.....................................................    45
Biographies:
    Undersecretary Jim Lyons.....................................    38
    Chief Pearlie S. Reed........................................    39
    Associate Chief Danny D. Sells...............................    40
Backyard Conservation Program...................................44, 139
Buffer Strips Initiative:
    Enrollments..................................................    57
Carbon Sequestration...........................................175, 184
Common Computing Environment Purchases...........................   116
Competitive Partnership Grants...................................   131
Concern for the Family Farm versus Conservation..................   176
Conservation Compliance and Conservation Operations..............    87
Conservation Farm Option (CFO) Program:
    Funding......................................................   116
    Participating States.........................................   111
Conservation on Private Lands....................................   167
Conservation Philosophy of Mr. Reed..............................    41
Conservation Reserve Enhancement Program (CREP)..................    57
Conservation Reserve Program (CRP):
    Additional Funding...........................................   164
    Caps.........................................................   164
    CCC Reimbursement............................................   125
    Cover crops..................................................    78
    Demand.......................................................   164
    Enrollment.................................................135, 164
    Environmental Benefits Index (EBI)...........................   124
    Technical Assistance.........................................   134
Debt For Nature..................................................    70
Demonstration Project Language...................................   142
Digital Soils Database...........................................   118
Earth Team Volunteers............................................   111
Emergency Watershed Protection Program (EWP):
    Commitments versus Obligations...............................   157
    Flood Plain Easements........................................   157
    History of Appropriations....................................   100
    Unobligated Emergency Supplemental Balances..................   153
Endangered Species...............................................   136
Environmental Monitoring and Research............................   131
Environmental Quality Incentives Program (EQIP):
    Allocations for FY 1998......................................   123
    Allocations for FY 1999......................................   112
    Change in allocation process (FY 1998 versus FY 1999)........   122
    Eligible Acreage versus allocation...........................   123
    Funding of the Colorado River Salinity Control Program.......    58
    Funding Priority Areas in FY 1998............................   120
    Funding Needs for Clear Water Action Plan (CWAP).............    58
    Legitimacy of EQIP Contracts.................................   181
    Listening Sessions.....................................74, 165, 178
    Priority Areas...............................................   182
    Program Level for FY 2000....................................   112
Erosion Rates....................................................   132
Explanatory Notes................................................   192
Farmland Protection Program (FPP):
    Acres Propsoed for Conversion................................   163
    Demand.......................................................   160
    Efforts......................................................    55
    Loss of Prime Farmland.......................................   133
    Requests.....................................................    56
Federal and Non-Federal Obligations Sources......................   103
Field Conservationists Needs.....................................   175
Fiscal Year 2000 Budget History Table...........................47, 110
Fiscal Year 2000 Compliance......................................   117
Flood Plain Easements............................................    97
Forestry Incentives Program (FIP):
    FIP and SIP Appropriations Comparison........................   111
    FIP Allocation Release in Florida............................    66
    Supplemental Funding Allocation for FY 1999..................   138
Global Climate Change:
    Economic Analysis............................................    54
    Impact.......................................................    50
    Kyoto Protocol...............................................    51
    Kyoto Global Climate Change Treaty Economic Impact Assessment   181
    Research.....................................................   162
Grazing Lands:
    Earmark Allocations for FY 1999..............................   121
    Funding for FY 1998 and FY 1999..............................   140
    Grazing Lands Assistance.....................................   108
    Grazing Lands Conservation Initiative (GLCI).................   108
    Grazing Lands Specialists....................................   108
    National Grazing Lands Technology Institute..................   109
    Training In Grazing Science..................................   109
Hydrologic Unit Areas..........................................105, 158
Kyoto Protocol...................................................    51
Improving Accountability of NRCS Funds...........................   159
International Activities.......................................107, 116
Land Legacy Initiative...........................................    73
Learning More About NRCS.........................................    79
Loss of Prime Farmland...........................................   133
Loss of Arable Lands.............................................    42
Mitigation Banking...............................................    85
National Resources Inventory.....................................   116
National Soil Information System.................................    91
New Funding Areas................................................    63
Non-Federal Watershed and Rangeland Coordinators.................   103
Non-Profit and Community Action Cooperatives.....................   117
Northwest Salmon Recovery Initiative.............................   120
Object Class Breakouts...........................................   144
Opening Remarks:
    Undersecretary Lyons.........................................     1
    Mr. Reed.....................................................     7
Passenger Motor Vehicles.........................................   125
Plant Materials Centers:
    Alderson, West Virginia's Plant Materials Center.............    96
    Funding......................................................   119
    New Plant Releases...........................................    93
    Operating Costs..............................................    93
    Royalty Collections for New Plant Releases...................    96
Private Lands Enrolled in Conservation Programs..................   138
Program Evaluation Studies.......................................    97
Questions Submitted for the Record:
    Chairman Skeen...............................................    85
    Ms. Kaptur...................................................   162
    Mr. Walsh....................................................   164
    Mr. Bonilla..................................................   178
    Mr. Latham...................................................   183
    Ms. DeLauro..................................................   184
Reimbursements:
    Non-Federal Reimbursements...................................   126
    Other Federal Reimbursements.................................   125
Resource Conservation and Development (RC&D) Program:
    Authorizations for FY 1999...................................   120
    Federal and Non-Federal Assistance...........................   102
    Outstanding RC&D Loan Borrowers..............................   104
    Projects Planned, Adopted, and Completed.....................   103
Regional Offices.................................................    61
Rural Abandoned Mine Program.....................................   158
Section 11 Cap:
    Impact on CRP................................................   177
    Section 11 Cap..............................................72, 134
Soil Surveys:
    Digitizing and Orthophotography Cost Contributions...........    91
    Digital Soils Database.......................................   118
    National Soil Information system.............................    91
    Funding and Staffing Levels..................................   118
    Reimbursements...............................................    91
    Soil Surveys Published.......................................    91
Staffing:
    Conservation Technical Assistance Staffing Levels............   113
    Headquarter versus Field.....................................    88
    Proposed Reductions..........................................   159
    Reductions...................................................41, 88
    Reductions in the Field......................................    48
    Staff Year Summary (FY 1995-1999)............................   111
State and Local Contributions....................................    90
Technical Service Centers and Regional Offices and Institutes....    89
Technical Assistance:
    For All Conservation Programs................................    90
    For Conservation Reserve Program.............................   134
    For Wetlands Reserve Program.................................   134
    Technical Assistance versus Enforcement......................    64
Total Cost and Accountability System.............................   142
Transfer of Watershed Accounts to Conservation Operations........   133
Unified Watershed Assessment.....................................   126
Urban Conservation...............................................   141
Urban Resources Partnership (URP) Program:
    Cumulative Support through 1998..............................   114
    Funding for FY 1998 and FY 1999..............................   120
    Update of Activities.........................................   113
Watershed Planning Activities:
    Program Evaluations..........................................    97
    State and Local Funding......................................    96
Watershed and Flood Prevention Operations (WFPO):
    Description..................................................    98
    Funding Proposal versus Aging Watershed Structures...........   141
    Recreational Projects........................................   100
    Small Watershed Projects.....................................   101
    Status of Authorized P.L. 534 Projects.......................    97
    Watershed Project Status Review..............................   102
Watershed Restoration Strategies.................................   131
Water Quality Incentives:
    Demonstration Projects.......................................   106
    Funding for the Presidential Water Quality Initiative........   105
    Hydrologic Unit Areas......................................105, 158
    Hypoxia in the Gulf of Mexico................................   107
    Regional Project Allocations.................................   105
    Regional Projects............................................   106
    Water Quality Incentives.....................................   104
Wetland Delineations.............................................    86
Wetland Determinations...............................118, 140, 173, 189
Wetland Policy.............................................78, 167, 184
Wetlands Reserve Program:
    Additional Funding...........................................   164
    Applications and Enrollments................................85, 141
    Current Unobligated Balance..................................    87
    Enrollment Caps..............................................   164
    Enrollmemt Status............................................   164
    Demand.......................................................   164
    Salary and Total Costs.......................................    86
    Staff Years and Costs for FY 1998............................    86
    Technical Assistance.......................................134, 159
    Technical Assistance Reimbursements..........................    87
Wildlife Habitat Incentives Program:
    Funding Allocations..........................................   114
    Geographic Breakdowns........................................   115
    Update.......................................................   114
Workload:
    Analysis.....................................................    73
    Increasing Workload..........................................   139
Written Testimony:
    Statement of James R. Lyons..................................     8
    Statement of Pearlie S. Reed.................................    33

                   Marketing and Regulatory Programs

Opening Statement, Under Secretary, Michael V. Dunn..............   359
Biography, Under Secretary, Michael V. Dunn......................   450
FY 2000 Budget Request...........................................   361
Strategic Goals..................................................   535
Written Statement, Under Secretary, Michael V. Dunn..............   364

               Animal and Plant Health Inspection Service

Agricultural Quarantine Inspection:
    Agricultural Quarantine Inspection..........514, 653, 659, 666, 667
    Fee Schedule by Activity.....................................   591
    Funding and FTE's by Airport.................................   589
    Number of Staff Years Funded.................................   588
Animal Care:
    Animal Care, general.......................................569, 573
    Animal Welfare.............................................520, 567
    Doris Day Animal League Petition...........................653, 664
    Breeders of Cats and Dogs, Regulatory Change(s)..............   673
    Stolen Dogs..................................................   569
Animal Health Emergency Management...............................   663
Animal Import Centers..........................................627, 655
Animal and Plant Health Regulatory Enforcement.................645, 662
Aquaculture......................................................   611
Argentine Citrus...............................................518, 668
Asian gypsy moth/European gypsy moth.............................   613
Asian Longhorned Beetle.........................470, 526, 611, 663, 678
Australian Cattle................................................   509
Automated Cargo System...........................................   592
Automatic Targeting System.......................................   592
Aviation Safety................................................454, 675
Biography, Administrator, Craig A. Reed..........................   452
Biotechnology:
    International Harmonization..................................   666
    Staffing and Funding.........................................   632
    User Fees....................................................   665
Bioterrorism.....................................................   678
Boll Weevil..........................................511, 583, 654, 664
Bovine Spongiform Encephalopathy--BSE............................   612
Brown Citrus Aphid...............................................   642
Brown Tree Snake.................................................   610
Brucellosis..........................................513, 574, 575, 664
Brucellosis Quarantine Facility..................................   655
Budget Request, History..........................................   636
Buildings and Facilities.........................................   603
Carryover Funds..................................................   651
Cattle Tick Program............................................509, 594
Centers of Excellence............................................   633
Citrus Canker..................................................515, 612
Contingency Fund...............................................626, 653
Country-of-Origin Marking Requirements...........................   509
Detector Dog Training............................................   667
Doris Day Animal League Petition...............................653, 664
Electronic Poultry Certification.................................   647
Emergency Funding..............................................611, 616
Equine Infectious Anemia Program.................................   643
Exotic Newcastle Disease.........................................   527
Explanatory Notes................................................   855
Farm Animal Identification and Records Program...................   534
Federal/Non-Federal Dollars......................................   623
Fish-eating Birds................................................   518
Foot-and-Mouth Disease...........................................   576
Foreign Pests....................................................   513
Frogs............................................................   530
Fruit Fly Exclusion and Detection................................   660
General Accounting Office Reports/OIG Audits.....................   637
Genetically Engineered Products..................................   665
Golden Nematode..................................................   647
Gypsy Moth.......................................................   613
Harry S Truman Animal Import Center..............................   669
Horse Protection...............................................520, 665
Horse Study, NAHMS...............................................   603
Import/Export..................................................527, 661
Import/Export Veterinary Diagnostic User Fees....................   629
Imported Fire Ant..............................................608, 652
Infestation, definition..........................................   669
Integrated Systems Acquisition Project (ISAP)....................   586
International Cooperation in Animal Biologics....................   649
International Cooperative Administrative Support System..........   631
International Programs.........................................635, 645
International Trade..............................................   560
Invasive Alien Species...........................................   524
Johne's Disease..................................................   662
Karnal Bunt................................455, 536, 565, 601, 613, 679
Kudzu............................................................   654
Livestock Protection Collar......................................   600
``Living with Wildlife'' Campaign................................   598
Mediterranean Fruit Fly........................................577, 614
Mexican Fruit Fly................................................   614
National Animal Health Monitoring System.........................   602
National Center for Import/Export................................   655
National Monitoring and Residue Analysis Laboratory..............   645
National Germplasm Quarantine Center.............................   606
National Poultry Improvement Plan................................   647
National Wildlife Research Center................................   605
Noxious Weeds..................................................581, 583
Object Class Data................................................   660
Oriental Fruit Fly...............................................   614
Overseas Locations...............................................   621
Overtime, AQI Program............................................   659
Pine Shoot Beetle..............................................644, 647
Pink Bollworm....................................................   625
Pink Hibiscus Mealybug.........................................614, 655
Plant Methods Development Activities.............................   632
Plum Island Animal Disease Center Modernization................606, 654
Poultry Inspections..............................................   530
Predator Control Program.........................................   656
Pseudorabies..............................................578, 659, 677
Quarantine Fumigations.........................................670, 682
Questions Submitted for the Record:
    Chairman Skeen...............................................   567
    Mr. Kingston.................................................   682
    Mr. Bonilla..................................................   675
    Mr. Latham...................................................   677
    Mr. Pastor...................................................   679
Rabies...............................................529, 532, 644, 675
Regulatory Enforcement and Animal Care...........................   571
Saltcedar Tree.................................................651, 669
Sanitary and Phytosanitary Standards Management......536, 537, 563, 661
Scrapie..........................................................   655
Screwworm Eradication................................510, 561, 576, 658
Shared Administrative Costs......................................   660
Silverleaf Whitefly............................................628, 654
Stolen Dogs......................................................   569
``Swim with the Dolphins'' Program...............................   669
Swine Brucellosis................................................   575
TCK Smut.........................................................   515
Texas Oral Rabies Vaccination Program............................   675
Transportation of Animals Through Airports.......................   659
Trap Testing.....................................................   657
Trichinae Pilot Certification Project............................   643
Tropical Bont Tick...............................................   620
Tuberculosis, Bovine.............................................   585
Tuberculosis in Cervidae.........................................   615
User Fees:
    AQI User Fees..............................................591, 666
    Import-Export User Fees......................................   629
    Veterinary Diagnostics User Fees.............................   629
Vesicular Stomatitis.............................................   615
Veterinary Diagnostics User Fees.................................   629
Wild Horses......................................................   529
Wildlife Services:
    General...............................................454, 509, 594
    Aerial Safety..............................................454, 675
    Aircraft Operations..........................................   652
    Budget Proposal..............................................   671
    Employee and Property Safety.................................   670
    Methods Development........................................518, 666
    Texas Oral Rabies Vaccination Program........................   675
Witchweed........................................................   581
Wolf Damage Control..............................................   615
Written Statement, Administrator, Craig A. Reed..................   402

                     Agricultural Marketing Service

Administrative Expenses Limitation...............................   711
ADP Purchases....................................................   715
AMS Homepage.....................................................   716
Biography, Administrator, Enrique Figueroa.......................   451
Business Process Reengineering...................................   692
Certifying Agriculture Processing Equipment......................   752
Class I Pricing..................................................   716
Direct Marketing:
    Farmers Direct Marketing Action Plan.........................   541
    Program Information..........................................   539
Export Promotion.................................................   562
Explanatory Notes................................................   786
Federal Seed Act.................................................   698
Federal-State Marketing Improvement Program:
    Payments to States and Possessions--1998 Grants............699, 719
    Payments to States and Possessions--1998 Locations...........   701
Food Quality Protection Act Implementation.......................   744
Free Trade with Mexico...........................................   698
Grading:
    Cotton and Tobacco Reimbursement.............................   715
    Grading Activity Employee Totals.............................   691
    Grading Fees.................................................   691
    Qualified Through Verification Program.......................   720
International Trade Price and Volume Reporting...................   741
Marketing News:
    Budget Request...............................................   684
    Mandatory Price Reporting....................................   523
    Market Transparency..........................................   757
    Reporting on Organically-Grown Fruits & Vegetables...........   734
    Reports Status...............................................   692
    Object Class--Market News....................................   734
    Object Class--Organically-Grown Fruits and Vegetables........   735
Marketing Agreements and Orders:
    Federal Milk Marketing Order Reform Final Decision...........   459
    Northeast Interstate Dairy Compact...........................   716
    Peanut Non-Signer Program....................................   714
    Pistachio Marketing Order....................................   716
Marketing Services Object Class 2500 Breakout....................   715
Microbiological Data Program:
    Budget Request.............................................686, 755
    Object Classes...............................................   750
National Laboratory Accreditation Program........................   694
Organic Certification:
    Budget Request Breakout......................................   689
    Definition...................................................   735
    Final Rule Publication.......................................   684
    Implementation...............................................   455
    National Organic Standards Final Rule........................   740
    Nutrient Management Program..................................   736
    Program Information--Spending and Staff Years................   718
    Program Table................................................   687
Perishable Agricultural Commodities Act..........................   709
Pesticide Data Program:
    Adherence to Committee Guidelines............................   749
    Alar Residues................................................   517
    Budget Request for PDP.......................................   712
    Consumer's Union Report......................................   741
    Coordination with EPA........................................   759
    Crop Protection Products.....................................   749
    EPA Coordination.............................................   753
    Federal Funds................................................   718
    Funding Table................................................   753
    Integrated Pest Management and Related Programs..............   743
    Microbiological Initiative...................................   686
    Participating States--Pesticide Data Program.................   533
    Program Information..........................................   717
    Rapid Response...............................................   741
    Registration and EPA.........................................   712
    Reimbursement to GIPSA.......................................   718
    USDA and EPA Relationship....................................   750
    Requirements of Food Quality Protection Act................532, 759
Pesticide Recordkeeping Program..................................   730
Pesticide Use--Spending..........................................   742
Plant Variety Protection Act.....................................   716
President's Year 2000 Working Group..............................   740
Questions Submitted for the Record:
    Chairman Skeen...............................................   567
    Mr. Latham...................................................   757
Reports:
    OIG Report Findings..........................................   722
    Status of OIG and GAO Reports................................   729
Research and Promotion:
    Assistance to Pork Producers.................................   736
    Funding Received from FAS....................................   697
    New Programs.................................................   732
    OGC Legal Services...........................................   696
    Mandated Agriculture Promotion Programs......................   758
    Referendum Schedule..........................................   698
Research Cooperative Agreements..................................   732
Screwworm Facility--Mexico.......................................   472
Section 32:
    Commodity Purchases..........................................   705
    Surplus Removal..............................................   708
    Disaster Relief..............................................   703
    Emergency Surplus Removal....................................   703
    Export Purchases.............................................   704
    Table--Financing.............................................   708
Standardization Program..........................................   689
Tobacco Funding..................................................   690
Transportation Services:
    Missouri River Project.......................................   733
    Regulatory Actions...........................................   713
    River Infrastructure.........................................   758
    Surface Transportation Board.................................   730
Vertical Integration.............................................   757
Wholesale Market Development:
    Budget Request--Small Farms..................................   751
    Projects Status..............................................   694
Written Statement, Administrator, Enrique Figueroa...............   386
Y2K Emergency Funding............................................   732

        Grain Inspection, Packers and Stockyards Administration

ADP Hardware/Software Purchases..................................   776
Aflatoxin Inspections............................................   764
Anticompetitive Practices........................................   780
Auction Market Failures..........................................   766
Biography of Administrator, James R. Baker.......................   453
Commodity Contracting Guidelines.................................   782
Complaints From Livestock Producers..............................   761
Concentration.............................................472, 559, 757
Contract Poultry Growers.........................................   521
Custodial Account Compliance Audits..............................   769
Dealer Failures..................................................   772
Dealer/Order Buyer Financial Failures............................   765
Economic/Statistical Analysis--Investigations....................   771
Emerging Grain Testing Needs Increase............................   777
Explanatory Notes................................................   951
Exported Grain Complaints........................................   763
Four Firm Concentration..........................................   765
Funds Spent on Competition, Fair Trade Practices, Financial 
  Protection.....................................................   769
FY 2000 Budget Request...........................................   770
Generic Sample-Lot Inspection Certificate........................   769
GIPSA Electronic Network.........................................   775
Grain Dust Explosions............................................   763
Grain Facilities.................................................   761
Grain Inspected and/or Weighed...................................   762
Grain Transportation Issue.......................................   783
Heavy Metal Testing..............................................   764
Hot Production...................................................   561
International Monitoring Program.................................   773
Livestock Procurement Investigations.............................   774
Livestock Slaughter..............................................   767
New User Fees....................................................   781
Oat Standards....................................................   772
Other Services...................................................   770
Packers & Stockyards Reorganization............................771, 781
Packer Concentration...........................................538, 784
Packer Competition and Industry Structure........................   779
Pesticide Data Program...........................................   773
Poultry Compliance...............................................   780
Poultry Compliance Complaints....................................   764
Poultry Compliance Investigations................................   780
Poultry Concentration............................................   522
Poultry Grower Complaints........................................   780
Proposed Regulations--Grower Contracts...........................   774
Proposed Rule--Feed Weighing.....................................   782
Questions Submitted for the Record:
    Chairman Skeen...............................................   761
    Mr. Latham...................................................   784
Select Elements in Grains772.....................................
Slaughters/Processors Subject to the P & S Act...................   768
Specific Grain Variety Testing...................................   778
Streamlining.....................................................   779
Unrecovered Losses...............................................   772
U.S. Standards for Rye...........................................   777
Vertical Integration.............................................   784
Violation Cases--Grain...........................................   773
Violation Reports................................................   764
Western Cornbelt Hog Procurement Investigation Report............   475
Written Testimony of Administrator, James R. Baker...............   429
Y2K Compliance...................................................   776

                                
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