[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           MARCY KAPTUR, Ohio
 JAY DICKEY, Arkansas               ROSA L. DeLAURO, Connecticut
 JACK KINGSTON, Georgia             MAURICE D. HINCHEY, New York
 GEORGE R. NETHERCUTT, Jr.,         SAM FARR, California
Washington                          ALLEN BOYD, Florida
 HENRY BONILLA, Texas
 TOM LATHAM, Iowa
 JO ANN EMERSON, Missouri           

 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 4

               RESEARCH, EDUCATION, AND ECONOMICS PROGRAMS

 Research, Education, and Economics

       Agricultural Research Service
       Cooperative State Research, Education, and

         Extension Service
       Economic Research Service
       National Agricultural Statistics Service

                              

                                ________
         Printed for the use of the Committee on Appropriations
                                ________
                     U.S. GOVERNMENT PRINTING OFFICE
 56-317                     WASHINGTON : 1999




                       COMMITTEE ON APPROPRIATIONS

                   C. W. BILL YOUNG, Florida, Chairman

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

                 James W. Dyer, Clerk and Staff Director

                                  (ii)


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

                              ----------                              

                                            Tuesday, March 2, 1999.

                   RESEARCH, EDUCATION AND ECONOMICS

                               WITNESSES

I. MILEY GONZALEZ, UNDER SECRETARY, RESEARCH, EDUCATION, AND ECONOMICS
EILEEN KENNEDY, DEPUTY UNDER SECRETARY, RESEARCH, EDUCATION, AND 
    ECONOMICS
FLOYD P. HORN, ADMINISTRATOR, AGRICULTURAL RESEARCH SERVICE
SUSAN OFFUTT, ADMINISTRATOR, ECONOMIC RESEARCH SERVICE
COLIEN HEFFERAN, ACTING ADMINISTRATOR, COOPERATIVE STATE RESEARCH, 
    EDUCATION, AND EXTENSION SERVICE
DONALD BAY, ADMINISTRATOR, NATIONAL AGRICULTURAL STATISTICS SERVICE
STEPHEN B. DEWHURST, BUDGET OFFICER
    Mr. Skeen.  The Subcommittee will come to order.
    We are glad to have the Department of Agriculture, 
Research, Education, and Economics; the Agricultural Research 
Service; the Cooperative State Research, Education, and 
Extension Service; and the National Agricultural Statistics 
Service here today.
    Dr. Gonzalez, all of these activities report to you. Miley, 
we are glad to have you with us today. We welcome you and all 
of your colleagues. There are two things that strike me when I 
look at your budget for the fiscal year 2000.
    First, I agree with the statement that our Country Research 
and Extension network is the envy of the world. It is a great 
system. It has served us very well for many years.
    Second, the budget, once again, proposes to change it a 
great deal. Dr. Gonzalez, we have received your prepared 
testimony and that of the other witnesses. It will appear in 
the record in full.
    You may introduce all of the witnesses and proceed as you 
wish. It is all yours, Miley. We are glad to have you here.
    Dr. Gonzalez.  Thank you, Mr. Chairman.
    It is good to be with you once again. We appreciate the 
opportunity to come and discuss the REE 2000 budget with the 
Subcommittee and to respond to any questions and ideas that you 
may be able to share with us this afternoon.
    Mr. Skeen.  We need to customize ideas and money.

                       Introduction of Witnesses

    Dr. Gonzalez.  Yes, indeed.
    If I may, let me introduce the members at the table who 
accompanied me this afternoon. From the Office of Budget and 
Program Analysis, Mr. Stephen Dewhurst, on my left.
    Mr. Donald Bay, the Administrator for NASS; Dr. Eileen 
Kennedy, the Deputy Under Secretary for REE.
    Mr. Skeen.  It is good to see these folks.
    Dr. Gonzalez.  Dr. Floyd Horn, Administrator for ARS; Dr. 
Colien Hefferan, our Acting Administrator for CSREES; and Dr. 
Susan Offutt, the Administrator for ERS.
    They, too, as you have indicated, have submitted testimony 
for each of the agencies. What I would like to do, with your 
permission, is to discuss in brief some of the testimony that 
we have submitted and then perhaps allow some time for each of 
the Administrators to highlight some of the accomplishments and 
some of the recommendations that we have made in our year 2000 
budget.
    Mr. Skeen.  Yes, sir. You just go ahead and proceed in any 
way that you wish. We will get down to business.
    Dr. Gonzalez.  Thank you very much.
    Mr. Skeen.  Thank you.

                           Opening Statement

    Dr. Gonzalez.  The REE budget that we are discussing here 
this afternoon is the first one that we have submitted since 
the Agricultural Research, Extension, and Education Reform Act 
of 1998 was passed last June.
    We think that it reflects strongly the programs that REE 
has submitted, and the recognition of the contributions that 
the research, education, economics, and statistics programs in 
the mission area can make in solving the pressing challenges 
facing agriculture today, both within our states and across the 
Country.
    Building on the extraordinary possibilities of cutting-edge 
research and biotechnology, REE is more capable than ever of 
delivering on new challenges in production agriculture, food 
safety, and nutrition; mindful of the need to find 
environmentally sound solutions.
    The budget we are discussing begins to meet the spirit of 
the message delivered by the House Committee on Science last 
fall in its report ``Unlocking Our Future.'' To quote the 
report, ``Science must be given the opportunity to thrive, as 
it is the precursor to new and better understanding of both 
products and processes.''
    I believe this budget affords the Nation's agriculture and 
food system, and all who have an interest in its future, the 
opportunity to benefit from such a thriving research and 
education system.
    Overall, the President's budget provides $2.1 billion for 
the four REE agencies; an increase in program level of 7 
percent above the fiscal year 1999 for the conduct of research, 
education, and statistical programs.
    This is the most significant increase in the REE budget 
since the early 1990s and moves REE in the same direction as 
budgets in other major research agencies across the Federal 
Government.
    Meaningful increases are requested for all four agencies to 
support high priority initiatives and programs addressing 
critical issues, such as food safety, human nutrition, emerging 
diseases, pest management, and environmental quality.
    The increase in the overall program level of funding 
depends significantly on the inclusion of the Initiative for 
Future Agriculture and Food Systems under Section 401 of the 
Reform Act.
    The program provides an infusion of $120 million in the 
CSREES budget to competitively award research, education, and 
extension grants focused on high priority issues in the program 
such as farm efficiency and profitability and natural resource 
management. The overall increase in the REE budget reflects the 
strong support that REE is receiving from the Secretaryand from 
the Administration. We have worked diligently with the Secretary to 
explain the benefits of the research investment and to make the results 
and benefits more broadly known to our stakeholders and the general 
public.
    However, I am still concerned that we find ways to balance 
the research portfolio in helping colleges and universities 
enhance their future capacity with base funding so that they 
may strengthen their ability to compete in the new Initiative.
    We want to work with you and the members of this 
Subcommittee in this arena. The minority serving institutions 
find themselves even more disadvantaged in the growing 
competitive environment that we are discussing.
    As we take some satisfaction in the increases in the budget 
and the implied recognition of its value and productiveness, I 
believe that we must acknowledge that new times demand new ways 
of doing business.
    I have talked with our university partners. They share this 
recognition of the need for us to change as we move into the 
21st Century. Multi-disciplinary, regional, multi-state, and 
multi-institutional strategies to facilitate both efficient and 
effective returns on our research, education, and extension 
dollars.
    We must continue to listen to our stakeholders and 
customers and hear their needs. We must tell them in plain 
English just what we plan to do and what difference it will 
make for our farmers, ranchers, food processors, and others in 
the food industry, as well as our customers.
    We must hold ourselves accountable for the investment made 
in our programs and understand that agriculture, research, and 
education issues transcend national borders and global 
competitiveness requires international scientific partnership.
    We believe we are meeting the outreach accountability and 
coordination requirements of recent legislation efficiently and 
effectively. We are confident with our efforts along these 
lines and they will contribute to program effectiveness and 
better equip us and you to defend our budget requests in 
increasingly competitive arenas.
    With that in mind, I looked through this material just 
before we went to the Senate hearing this morning. I think 
addressing the needs of being transparent, if you will, in the 
process and looking at outcomes, our CSREES document that you 
may not have talks about the initiatives, the priority areas, 
and the dollars that we are requesting, but also has on the 
back page some of the impacts that we have seen at the local 
level in many of our states.
    I just share that as an extra point of talking about our 
ability to be accountable to our stakeholders.
    Mr. Skeen.  Could we have that submitted for admission into 
the record?
    Thank you.
    [The information follows:]

[The official Commmittee record contains additional material here.]



    Dr. Gonzalez.  Often, agriculture, research and extension 
hold the keys to effectively addressing acute problems. Our 
recent response to the wheat and barley scab crisis in the 
Northern Planes is an example of how quick action can make a 
difference.
    Similarly, our rapid and effective response to the Asian 
Influenza scare proved to be very valuable in protecting the 
lives and health of many people.
    I believe it is equally important to call on and support 
the research and education system in government, at 
universities, and other research institutions in mounting a 
proactive long-term approach to solving or even avoiding acute 
problems.
    I believe the REE education and information technology 
programs can play a critical role in this endeavor. In our 
knowledge-based society, getting the right information in an 
accessible form to the user is the key to empowering farmers, 
individuals, families, and communities to improve their futures 
and guard against bad times.
    If I may quote again from the report, Unlocking Our Future, 
``Not only must we ensure that we continue to produce world 
class scientists and engineers, we must also provide every 
citizen with an adequate grounding in science and math, if we 
are to give them an opportunity to succeed in a technology-
based world of tomorrow.''
    The results of our research and analysis yield information 
that farmers need to effectively manage the many types of risks 
inherent in operating a farm, including crop selection, 
disease, weather, market volatility, and pest control.
    We have an obligation to ensure that this information gets 
to the farmers and other producers so that they can make 
informed decisions. They need this to have a complete safety 
net.
    I urge you in your deliberations on the REE budgets to take 
full advantage of the potential value of such a long-term 
approach for the new roles and responsibilities of scientific 
investigation and education in agriculture.

                       high priority initiatives

    We must make substantial funding for these areas the 
highest priority, if we are to prepare for the future. I would 
like to take just a moment or two to focus on some of the 
initiatives that are high priority within the year 2000 budget.
    They include: Integrated Pest Management, including 
implementation of our Food Quality Protection Act; Food Safety; 
Agricultural Genomics; Small Farms; Global Change; and 
Community Food Security.
    Effective pest management is a continuing challenge for 
agricultural producers. The public's increasing concern about 
the quality of the environment and the safety of ourfood, 
reflected in such laws as FQPA, heightens the challenge. The REE agency 
budgets include $29 million in increases focused on providing EPA 
information and essential data for science-based implementation of 
FQPA, and on advancing efforts to develop and transfer to producers 
environmentally sound and effective pest management technology.
    The initiative includes increases to support enhanced 
research on biocontrol alternatives to pesticides and new 
control technologies, as well as to support effective transfer 
of the new technologies to producers.
    Both the ARS and CSREES budgets include funding requests to 
expand work with producers to test new technologies and 
practices, and facilitate their adoption.
    Promoting food safety is a second issue in which the 
Administration and the Department have taken a keen interest, 
an interest that the fiscal year 1999 appropriations and the 
Reform Act indicate is shared by Congress.
    A farm-to-table approach to food safety has been adopted in 
which the potential for the introduction, transmission, 
prevention, and/or elimination of contaminants is 
systematically examined at each step along the path to the 
consumer's table.
    The REE component of the Food Safety Initiative in the 
fiscal year 2000 budget provides increases to ARS, CSREES, and 
ERS totaling $26 million, including increased funding through 
the National Research Initiative.
    To enhance the effectiveness of the National food safety 
research effort and the larger Food Safety Initiative, USDA in 
collaboration with the Department of Health and Human Services, 
is providing leadership in establishing a new joint institute 
for food safety research.
    Dr. Eileen Kennedy works with the groups from the other 
Federal Departments and has provided great leadership in this 
food safety arena.
    Created in response to the Presidential Directive, the new 
virtual institute will promote coordinated planning and 
priority setting of food safety research across the government 
and with the private sector using existing funds.
    A third initiative that I would like to highlight is 
agricultural genomics. The promise of biotechnology for 
producers is well-established.
    Higher yields, improved quality, greater resistance to 
disease and pests, and reduced stress due to adverse weather 
conditions are outcomes we can anticipate will help producers 
individually, and as an industry, to be more competitive in the 
global market.
    Mr. Skeen.  Excuse me for interrupting.
    Dr. Gonzalez.  Yes, sir.
    Mr. Skeen.  Dr. Gonzalez, I am going to have to leave for 
awhile. I want to turn this over to Mr. Kingston. He will drive 
the boat now. Thank you.
    Dr. Gonzalez.  Thank you.
    Mr. Skeen.  No offense.
    Dr. Gonzalez.  I will fill you in on the details.
    Mr. Skeen.  Very good.
    Mr. Kingston [presiding]. Thank you, Dr. Gonzalez. Please 
continue.
    Dr. Gonzalez.  Thank you, Mr. Chairman.
    As a leader in the President's Food Genome Initiative, a 
government-wide initiative, the USDA is making a major 
contribution to the larger effort, expanding our knowledge of 
genomics, the genomes of species of importance to food and the 
agricultural sector.
    The REE mission area has chaired the Interagency Working 
Group on Plant Genomics involving the office of Science and 
Technology Policy, the Department of Health and Human Services, 
the Department of Energy, and the National Science Foundation.
    In this role, REE continues to engage commodity group 
representatives and leading scientists in discussion about the 
Plant Genome Research Program. Efforts in the USDA Food 
Genomics Program will initially concentrate on identification 
of economically important traits; traits that increase yield, 
quality, and disease resistance in plants, minimize the need 
for pesticides, and protect the environment.
    The Reform Act indicates that both agriculture genome and 
agriculture biotechnology are high priority areas for the 
purposes of making grants.
    The Small Farm Initiative, the fourth initiative that I 
would like to discuss and highlight, focuses on many of the 
issues and concerns that have been in the media of late. Small 
farmers and ranchers make a valuable contribution to the 
agriculture and to rural America; often filling market niches 
and bringing new life to our rural communities.
    Many have fallen on hard times with the industrialization 
of agriculture and are struggling to find a place in an 
increasingly competitive sector.
    In 1997, Secretary Glickman established the National 
Commission on Small Farms to determine the status of small 
farms in the United States and recommend USDA actions to 
promote their economic viability and therefore their 
contribution to the agriculture sector and to rural America.
    The initiative is responsive to the Commission's report, A 
Time To Act, providing ERS and CSREES funds to better 
understand the market information needs of small farmers and 
the degree to which these needs are being met, and to develop 
programs to help small farmers acquire the critical business 
skills and develop effective marketing strategies that promote 
economically viable farms. Increased funding in the NRI will 
support examination of the economies of small farms and their 
contribution to local economies, as well as increase funding 
for research that is appropriate to that part of our 
agricultural sector.
    Data on small and medium size farms coming from the Census 
of Agriculture, recently completed by NASS, will be valuable in 
helping ARS and other agencies identify and conduct research 
responsive to the needs and priorities of these farms.
    Climate change is a fifth initiative that I would like to 
highlight. In support of the President's Initiative on Global 
Climate Change, the fiscal year 2000 budget includes funds in 
the ARS, CSREES, and ERS budgets to support research to gain a 
better understanding of climate change, its causes, and 
associated consequences for agriculture.
    The funds will also support complementary research on 
possible coping or adjustment mechanisms to minimize the 
adverse affect of climate change on agricultural production.
    Our final initiative is that which highlights community 
food security. Communities across the Nation have been 
confronting an increasing number of food-related problems, 
including unprecedented demand on the charitable food sector, 
the decline of local agriculture systems, andpoor nutrition. 
The CSREES budget includes $15 million for a Food Recovery and Gleaning 
Grant Program as the principal component of the USDA Community Food 
Security Initiative.
    The purpose of the grant program is to improve methods of 
collection, transport, and storage of recovered and gleaned 
food; to enhance the technical assistance and education network 
to empower communities to establish and administer food; 
recovery programs; and to extend understanding of the technical 
issues in food recovery.

                    Highlights of Ree Agency Budgets

    If I may just turn briefly to each of the four agency 
budgets. I would like to ask that each Administrator highlight 
some additional things. I am just going to touch on a couple of 
the items that I think are of principal importance.
    The Agricultural Research Service fiscal year 2000 budget 
request $837 million in ongoing research and information 
programs, or a net increase of $51 million over the fiscal year 
1999 budget.
    The proposed increases will be dedicated to a broad range 
of high priority programs, such as food safety, human 
nutrition, invasive species, and integrated pest management. To 
partially offset these increases, the budget also includes 
redirection of approximately $35 million in current programs to 
fund higher priority initiatives of nationwide interest.
    As the principal intramural, biological, and physical 
science research agency in the Department, ARS continues to 
play a critical role for the Department in the larger 
agricultural community in conducting mission-driven research.
    The budget includes an increase of $20 million in the third 
year of the Human Nutrition Research Initiative. Research 
results continue to confirm the critical role of nutritious 
diets in promoting good health and mitigating diet-related 
disease.
    It is hard to over-estimate the potential payoff for 
individuals and society as a whole from the adoption of healthy 
diets. At the scientific level and the personal level, 
increasing our understanding of the relationship between diet 
and health, and the sources of important nutrients will enhance 
our well-being and reduce our national health care bill.
    The President's fiscal year 2000 budget provides $1.1 
billion for the Cooperative State Research, Education, and 
Extension Service. This includes $948 million in discretionary 
budget; an increase of $24 million over the fiscal year 1999.
    Within this discretionary budget, an increase of $81 
million is provided for the National Research Initiative. The 
NRI increases will focus on several high priority areas, 
including development of Integrated Production Systems, 
Agricultural Genomics, Global Change, and Food Safety. As I 
indicated a few minutes ago, a real focus on our needs of small 
and intermediate producers. In addition increases in the CSREES 
budget provides for a redirection of fiscal year 1999 funding 
for the new Integrated Research, Education, and Extension Grant 
Authority provided by the Reform Act.
    Bringing the research and education components together 
with extension affords the opportunity to integrate programs 
which draw on the strengths of both activities. The research 
agenda is more likely to be informed by extensions connection 
to the consumer and customer.
    Extension is more likely to understand research findings 
coming from the research. In providing critical funding to 
research, education, and extension programs of the Land Grant 
system, and their universities and organizations across the 
country, CSREES continues to play a central role in helping 
generate new knowledge and technology, and in facilitating the 
transfer of that knowledge and technology to those who will use 
it.
    As you will note, the Economic Research Service budget 
decreases from $63 million in the fiscal year 1999 to $56 
million in fiscal year 2000. As the Department's principal 
intramural economics and social science research agency, ERS 
conducts research and analysis on the efficiency, efficacy, and 
equity aspects of issues related to agriculture, food safety, 
nutrition, the environment, and rural development.
    The decreased level of funding is due to the return of food 
program studies to the Food and Nutrition Service. The fiscal 
year 2000 budget supports new or enhanced research of 
approximately $2.9 million.
    The National Agricultural Statistics Service budget 
declines by $3 million to $101 million due to the cyclical 
nature of the Census of Agriculture. The results of the 1997 
Census, the first that NASS has conducted, were released last 
month, 10 months ahead of schedule.
    The agency's budget includes several increases to enhance 
and broaden its statistical program. They include $2.5 million 
to conduct a new fruits and vegetables survey as a part of the 
Food Safety Initiative; $1.6 million to collect pesticide use 
data for horticulture and greenhouse industries to support a 
science-based response to FQPA; and $1.8 million to conduct the 
decennial Agriculture Economics and Land Ownership Survey.
    In summary, I want to reiterate that I believe, given the 
tight budget environment, that our REE agency's budgets reflect 
a strong commitment to investment in agriculture research, 
statistics, education, and extension; one stronger than in the 
past.
    It also reflects and understanding that research and 
education are keys to solving, not only the problems 
agriculture and its producers are facing today, but those of 
tomorrow. With continued strong investment, we will be ready to 
meet those future challenges.
    [The prepared statement and biography of Dr. Gonzalez and 
the biography of Dr. Eileen Kennedy follow:]

[The official Commmittee record contains additional material here.]



    Mr. Kingston.  Thank you very much, Dr. Gonzalez.
    The Ranking Member, Ms. Kaptur from Ohio, has joined us. 
She did not have a chance to make an opening statement. I 
wanted to yield to her.
    Ms. Kaptur.  Thank you, Mr. Chairman, very much.
    I just wanted to welcome Dr. Gonzalez and your many 
colleagues from the Department. These are very important areas 
in which each of you work. I want to allow time for questions 
here of our members, some of whom are on very tight time 
schedules now.
    Without question, the work that you do is really 
fundamental to continuing the primacy of agriculture in this 
economy. Though I must say I worry about it in view of some of 
the severe conditions affecting segments of our marketplace 
today and many of our producers.
    I think that the research that is done in all of the 
various aspects of USDA and the support of the basic 
infrastructure at the Land Grant Colleges across this Country 
are absolutely the basis for the success that we have had in 
this Century.
    I await my opportunity to question, Mr. Chairman.
    Mr. Kingston.  Thank you very much, Ms. Kaptur.
    Dr. Gonzalez, we have lots of committees meeting at the 
same time. So, what I wanted to do is have your colleagues go 
ahead and give their statements as quickly as possible; maybe 
deviating from the text and just saying what you need to say.
    That way, Subcommittee members can go ahead and get into 
the questions, which I know we would all like to do as soon as 
possible.
    So, I guess Dr. Horn is first.
    Dr. Gonzalez.  We can do that.
    Mr. Kingston.  I hate to ask you to hurry. I know you want 
our questions as much as we want to ask them.

                               ars budget

    Mr. Horn.  Thank you very much.
    I am Floyd Horn, Administrator of the Agricultural Research 
Service. First, let me say that this has been a landmark year 
for ARS. We have, in essence, restructured all of our national 
programs. There are now 23.
    They are all up on the Internet for comment. We have in 
fact received over 100,000 comments from stakeholders, and 
customers, and others that have helped us put this agency 
budget together this year.
    It is a very important sequence of events. They are both 
there in summary and in full length articles. So, the staff and 
the members of the Subcommittee are certainly welcome to look 
at those and comment. The ARS fiscal year 2000 budget 
recommends a funding level of $837 million for ARS this year.
    This is an increase of $51 million above the 1999 funding 
level. Actually, there is $76.4 million in new and expanded 
research identified in the budget, and $9.93 million to finance 
anticipated pay costs.
    We have not had a pay cost increase for a number of years. 
That has really caused us some consternation in the past year. 
Also, there is a proposed decrease, as Dr. Gonzalez mentioned, 
of $35 million in ongoing research programs which are all 
important to someone. In this environment they have been deemed 
less important than some others as requested in the 
Departmental and Administration Initiatives. We also have in 
this budget, $44.5 million for facilities modernization and 
construction.
    Most of this is modernization and an effort to meet 
critical standards and the like. Now, in keeping with doing 
this very quickly, let me simply run through a list of proposed 
program initiatives so that you can see how we plan to 
strengthen ARS' intramural program.

                      fy 2000 program initiatives

    Emerging diseases and exotic pests. This is a major need 
because of a number of environmental issues that will be 
limiting or removing some of the existing tools in the 
marketplace. We are also threatened, with an increasing influx 
of problems as a result of new trade agreements. These include 
both diseases and pests of plants and animals.
    The Agricultural Genome Project. Plant genome, animal 
genome, and microbial genome research will be pursued under 
this initiative.
    In the Food Safety Initiative, I will say that in our 
particular case, we will be placing much more emphasis on 
production agriculture; pre-harvest food safety issues trying 
to prevent the occurrence of pathogens in food and food 
products.
    Human nutrition is a major item in this year's budget. The 
human nutrition request is as high as it is because there is a 
Presidential Initiative to try to fully-fund research at the 
six ARS Human Nutrition Research Centers.
    That has fallen behind in years past. This initiative is a 
multi-year $53 million funding request. We anticipate there 
would be no additional funding requested for some time once 
these additional funds are provided.
    The Food Quality Protection Act implementation is an 
obvious need. We are providing a great deal of the food intake 
information that is necessary in order for EPA to calculate the 
appropriate limits.
    The Sustainable Ecosystems Programs are our efforts to make 
agriculture very proactive in terms of enhancing and protecting 
the environment.
    Air quality deals with odors, as well as particulate 
matters; PM-10 and PM-2.5 issues that have become serious 
pollution problems.
    Global climate change as you have heard is a $15.3 million 
increase. That is a sizeable increase requested in order to 
help agriculture deal with the potential for climate change, 
including carbon dioxide enrichment.
    We have an item in this budget for agricultural 
information. It has been thought for some time that our program 
management is not transparent to all. We have taken care of 
that with the restructuring of the National Research Programs 
and with the use of the Internet.
    We still need to get our information out to those who can 
best use it. So, we have requested an increase for that. I 
think I will stop with that, although if there are questions on 
any of those programs that require more detail, or any of the 
construction projects in the ARS budget, we will be glad to 
respond.
    [The prepared statement and biography of Dr. Horn follows:]

[The official Commmittee record contains additional material here.]



    Mr. Kingston.  Thank you very much, Dr. Horn.
    That was very concise and very good. I am going in the 
order that I have it. Dr. Offutt, you are next.
    If I am going out of order, let me know, Dr. Gonzalez.

                     Statement of Dr. Susan Offutt

    Dr. Offutt.  Thank you.
    My name is Susan Offutt. I am the Administrator of the 
Economic Research Service. Let me just briefly tell you one or 
two things about our budget proposal this year.
    The total proposal is for $55.6 million. That envisions 
keeping ERS about the size it is now; about 531 staff years. 
That allows us to maintain our investment in information 
technology, and also cooperative agreements with the Land Grant 
Universities so that we can continue to operate with the right 
labor/capital ratio at our agency.
    I want to mention one of our requests for an increase in 
particular and that concerns our program on commodity market 
analysis and information. As Congresswoman Kaptur already 
suggested, we are in some turbulent times in commodity markets.
    We are simultaneously seeing changes in the world macro 
economy. We are also seeing changes in the structure of the 
domestic market itself. Relationships among producers, 
processors, and retailers are changing.
    So, the nature of the environment is very much different 
than it was 15 or 20 years ago. We think this affects theflow 
of information through the sector, whether it is among private entities 
or from public to private entities.
    A second important change that we all recognize is the 
evolution of information technologies, our ability to deliver 
information quickly and in a format which is more assessable to 
many than it has been in the past.
    That certainly affects not only the way the agricultural 
markets communicate, but it also affects the way we do our 
business at USDA. These information technologies have allowed 
what I believe are very significant productivity increases on 
the part of economists.
    You do not often think about research productivity itself. 
Clearly, we have had major gains in economics because of our 
enhanced ability and computational capacity, as well as word 
processing and the like.
    So, we see changes in the environment and changes in the 
information technology affects both our business at USDA, as 
well as the way markets use information. Also, an important 
related question at USDA is the change in the number and the 
kinds of people we have available to do this work.
    Quite frankly, we are going through a generational change. 
There are many people who worked on commodity markets for 20, 
30 years and who, in their heads, carried a lot of industry-
specific knowledge. Those people are retiring. What do we do to 
build human capital? How do we replace them?
    I think we have to look increasingly to our colleagues in 
the Land Grants where some of the best expertise resides. So, 
all of those developments wrapped together leads us to request 
an additional $854,000 this year to help steer through what we 
think are some significant changes in agriculture and the way 
information flows in this sector.
    We appreciate your support in helping USDA be part of that 
change and not a retardant. That is all I would like to 
highlight out of our request this year.
    Thank you.
    [The prepared statement and biography of Dr. Offutt 
follows:]

[The official Commmittee record contains additional material here.]



    Mr. Kingston.  Thank you very much, Dr. Offutt. Dr. 
Hefferan.

                    Statement of Dr. Colien Hefferan

    Dr. Hefferan.  Thank you.
    I am Colien Hefferan. I am pleased to present the fiscal 
year 2000 budget request for the Cooperative State Research, 
Education, and Extension Service. CSREES works primarily with 
Land Grant Universities and other university partners in 
research, extension, and education to deliver programs that 
enhance the knowledge base for agriculture, rural development, 
and human health.
    Within our plan for fiscal year 2000, I would like to 
highlight three areas of emphasis. As we have requested in our 
budget, we are seeking an increase of $24 million in our 
discretionary funding, which is a 2.6 percent increase in our 
program.
    We would like to target this increase in three particular 
areas. First of all, we are emphasizing high priority research, 
education, and extension issues where there is a substantial 
need for increased investment.
    These include areas such as food safety where, as a part of 
the President's Food Safety Initiative, we are proposing to 
continue and increase our efforts in both research and 
extension related to food safety.
    Secondly, within the targeted program areas, we are seeking 
an increase in funds that support minority serving 
institutions, and increase our capacity in agricultural 
knowledge.
    Similarly, we are looking at specific programs that will 
help producers address a growing complex regulatory and 
international market environment. Particularly, we are seeking 
funds to expand our ability to help producers deal with the 
Food Quality Protection Act and issues such as the loss of 
methyl bromide.
    One of the things that we recognize as we target these 
programs is that there is not always a simple technological 
fix, a scientific fix, issues facing agricultural producers. 
[for all of these things]. What we need to do is to look at the 
knowledge base that we have and develop better education and 
outreach activities.
    I think methyl bromide is a good example of that. So, our 
first areas of emphasis are really high priority targeted 
issues.
    Our second emphasis area is, where appropriate to solving 
problems, to integrate Research, Education, and Extension 
Programs under a new authority included in the Agricultural 
Research, Extension, and Education Reform Act of 1998.
    We are proposing to move several existing programs that are 
currently funded under special grant and Smith-Lever-3D 
authorities, as well as establish several new programs which 
would be competitively awarded and integrateour research, 
education, and extension on some of these high priority issues; the 
ones I have mentioned, as well as water quality, attaining our IPM 
goals, and looking at issues such as the delivery of programs, better 
science, and education for small and medium size producers.
    The third basic area of emphasis within our budget is in 
competitively awarded programs. We are seeking an $81 million 
increase in the National Research Initiative, a well as the 
establishment of competitive programs under new integrated 
activities.
    This poses a challenge to the agency to manage competitive 
programs in a way that generates stability at institutions, and 
addresses broad programmatic kinds of issues.
    We are looking at these new competitive programs as a way 
that we can mount some larger problem-focused programs, both 
through the National Research Initiative and the integrated 
authority.
    Those are the three main areas in our budget request--to 
target our high priority issues, to integrate Research, 
Education, and Extension Programs where it is effective in 
solving problems that require a better knowledge base, and to 
move more of our programs to a competitive basis for award.
    [The prepared statement and biography of Dr. Hefferan 
follows:]

[The official Commmittee record contains additional material here.]



    Mr. Kingston.  Thank you very much, Dr. Hefferan. Mr. Bay.

                          Nass Budget Summary

    Mr. Bay.  Thank you, Mr. Chairman.
    Members of the House Subcommittee, I am very pleased to 
have this opportunity to discuss the budget for the National 
Agricultural Statistics Services with you this afternoon.
    First, I would like to bring you up-to-date on the census 
of agriculture. Since this is the first time we have ever done 
the census in the Department of Agriculture, we felt like it 
was very successful.
    One of the things that we were able to do was use our field 
offices to help speed up the processing. Also, we eliminated 
two of the mailings that we had planned. Those last two 
mailings used to stir up a lot of complaints which came to you 
folks.
    We had a 75 percent reduction in Congressional complaints 
or constituents' complaints this time. In fact, only one out of 
every 100,000 people who received the census questionnaire 
chose to write their Congressman or Senator complaining about 
the census.
    So, I wanted to mention that, because you may have gotten 
one of those letters. I just thought I would point that out 
that we were very pleased with the public's perception of the 
census form and completing it without complaining.
    After we acquired the census, one of the things that we had 
responsibility for was doing the census in what they call the 
outlying areas or U.S. territories, which included Puerto Rico.
    Upon traveling to Puerto Rico, I learned from the Director 
of Agriculture that NASS was the only agency within the U.S. 
Department of Agriculture, with field offices, that does not 
have an office in Puerto Rico.
    So, in working with the Department of Agriculture and doing 
the census, we found that there would be considerable 
advantages in having a cooperative program there, which would 
join the agricultural statistics people and the Department of 
Agriculture in Puerto Rico.
    We would send a few people that we have working on the 
mainland and try to make the two programs more alike so that 
they would fit into our publications and feel more a part of 
the U.S.
    I think this is a very important program. The request is 
for $304,000. We hope that you will look favorably on that.
    A second priority item I might mention is the Agricultural 
Economics and Land Ownership Survey, which is done only every 
10 years. It is the only data that are collected from people 
that only own land, but do not farm it themselves.
    All of our other surveys are with farm operators. This 
survey also collects data from landlords about their economic 
situation and how they are looking at their farm investment.
    The third initiative that we have is an expansion of the 
Pesticide Use Surveys. There are two key points here. One is 
that this is to, for the first time, reach out to the 
horticulture specialty industry which now makes up 11 percent 
of the value of crop production in the United States.
    The second thing is that we hear from the States that they 
are very concerned about the movement to go to mandatory 
reporting of pesticide use. States hope that good solid data on 
pesticide use will help prevent the passage of mandatory 
reporting law.
    A couple of States have already done that. There is a 
feeling among the commissioners, directors, secretaries of 
agriculture that if we could produce good data using voluntary 
cooperation, that would avoid having a mandatory program to put 
in. So, we hope you will support that.
    With that, I just thank you for your support in the past.
    [The prepared statement and biography of Mr. Bay follows:]

[The official Commmittee record contains additional material here.]



    Mr. Kingston.  Thank you very much, Mr. Bay.
    The Chair is going to call on people in the order of their 
arrival, which will save the panel from having to hear from Mr. 
Dickie for a real long time, since he came last.
    With that, I will ask the members to try to hold yourselves 
to 5 minutes, if you can. Do you want to say anything?
    Mr. Dickie.  No.
    Mr. Kingston.  Ms. Kaptur.

                       Reduction in Formula Funds

    Ms. Kaptur.  Thank you, Mr. Chairman.
    I wanted to begin with Dr. Hefferan, if I might.
    As I read the budget submission by the Administration, 
there is about a 10 percent reduction, as I read it, in the 
base formula funds to our Land Grant University system. I am 
curious if my reading is correct and if so, why is this being 
recommended?
    Dr. Hefferan.  The budget proposal does give emphasis to 
competitively awarded programs. First, there is an opportunity 
to involve a broad range of institutions in programs that are 
competitively awarded. This brings as many scientists, 
educators, and outreach individuals to address agricultural 
issues as possible.
    I think one of the things that is important to recognize is 
that the success of agricultural research and extension has 
been based on a verybroad portfolio of funding, including 
Formula Programs to institutions.
    The Administration continues to support that base of 
support through Formula Programs. The growth areas within this 
budget are for competitively awarded activities.
    Ms. Kaptur.  So, what you are saying is that 10 percent 
that would be taken from the Land Grants will be put into your 
Competitive Grants Program?
    Dr. Hefferan.  Well, I am not sure that it is quite that 
simple a redirection. I should also tell you that under the 
competitively awarded programs that we currently operate, the 
National Research Initiative and several other programs, the 
Land Grant Universities are really the primary recipients of 
those funds.
    When we move toward and give emphasis to programs that are 
competitively awarded, that is not moving funds out of the Land 
Grant Institutions. It is changing the way in which those 
institutions receive the funds. The increase in the budget 
would most likely more than offset the declines that there 
would be perceived.
    Ms. Kaptur.  So, they would be eligible for additional 
funding, but through competitively bid research.
    Dr. Hefferan.  That is correct. Land grant universities 
would be eligible and probably highly competitive, the most 
highly competitive. That is where our capacity in agricultural 
research and extension is primarily vested.
    Dr. Gonzalez.  Ms. Kaptur, may I respond to that as well?
    Ms. Kaptur.  Yes. I would appreciate that.
    Dr. Gonzalez.  We continue to have the discussion about 
this balance, if you will, in terms of the portfolio for our 
research, education, and extension investment. We have, again, 
gone through another discussion period.
    We have engaged the universities, both our Land Grant 
community and others, to help us as we identify and define what 
this broader portfolio might be so that we can capitalize on 
the investments that we have made traditionally in this case, 
in our Land Grant system.
    We have our new 1994 Land Grants. A number of those 
institutions with smaller university and college programs need 
to continue to build capacity. So, we are still in this 
discussion internally, as well as with our university 
community, as to how we find other approaches to this funding 
of both the base programs and our competitive grants programs.
    Ms. Kaptur.  So, you are saying that institutions that are 
not currently Land Grant institutions would be able to submit 
proposals for the competitively bid and the Land Grants could 
also.
    Dr. Gonzalez.  That is correct. They all then would have an 
opportunity to vie for those competitive grants.
    Ms. Kaptur.  How has this been received by the Land Grant 
Institutions?
    Dr. Gonzalez.  Well, when we began this discussion a little 
more than a year ago, we continued to work with the leadership 
from not only the Land Grant universities, but state 
universities and colleges.
    As I have indicated to this Subcommittee in the past, and 
as I visit with each of you on an individual basis, there are 
many other educational institutions out there that I think can 
benefit from being partners and collaborators in this process 
of education, research, and extension.
    So, given that we need to talk about how we do this in the 
new environment, given that we have limited resources, I think 
a part of our discussion with the leadership is how do we 
engage in this together?

                         csrees budget request

    Ms. Kaptur.  Does the President's budget reflect your 
agency's budget proposal for Base Formula Funds?
    Dr. Gonzalez.  Well, we went through this process in 
putting our priorities in place. They are different, of course. 
As you go through the internal budget process of establishing 
high priority programs and so on, the results were different 
than what we had traditionally proposed.
    Ms. Kaptur.  Did you want to say something, Dr. Hefferan?
    Dr. Hefferan. Just to reiterate what Dr. Gonzalez has said 
that there is an iterative process in the development of the 
budget. The final budget is not where we began.
    We certainly have spent a great deal of time talking with 
institutions about this particular approach to budgeting. I 
think there is an over-riding shared goal that we grow the 
resources for agricultural, research, extension, and education 
from any and all sources.
    There is a capacity to perform more and better agricultural 
science throughout the country and we need to support that. So, 
there is strong agreement on that. It is clear that some 
institutions would prefer to see funds coming to them in a 
formula base.
    That really challenges us to think about how we administer 
competitive programs in a way that they aren't destabilizing to 
the capacity in agricultural science. We must have longer, 
larger, and different kinds of awards that focus on broad 
programs in agriculture.
    Ms. Kaptur.  Could I ask you, is this the budget that you 
submitted to OMB?
    Dr. Hefferan.  No, it is not.
    Ms. Kaptur.  It is not. How is it different?
    Dr. Hefferan.  We had requested increase levels at somewhat 
higher ranges across a number of programs, including the 
Formula Programs.
    Ms. Kaptur.  I thank you very much. If you could provide 
more detail on your original request for the record, I would 
appreciate it very much.
    Dr. Hefferan.  We shall.
    [The information follows:]

[The official Commmittee record contains additional material here.]



                  public understanding of agriculture

    Ms. Kaptur.  I do not want to go over time here myself, but 
Dr. Gonzalez, I wanted to ask you in your testimony you talk a 
lot about the future, and the importance of research, and 
challenges facing agriculture and the Nation.
    Have you had a chance to go through the Museum of American 
History since we last chatted to see their exhibition on 
agriculture? The question I want to ask you is do you think 
that, that exhibit adequately represents the place of 
agriculture in this economy and the future challenges we face 
as a Nation with technologies related to agriculture?
    Dr. Gonzalez.  I have not visited it. I have had others who 
have and have reported back, so I understand the basis of your 
question. It is a part of the discussion that we have continued 
to engage in with a broader set of players other than those of 
us who come from an educational background and/or from an 
extension background.
    We have expanded our efforts on behalf of the total 
research and education agenda to look at 21st Century 
agriculture and the kind of scientist, the producer, the 
engineer, and the professional that we are going to need.
    If we are going to capture the imagination of young people 
to get them involved in our agricultural system, then working 
together we need to find new ways of attracting their 
attention.
    We are engaged in discussions with the Disney Corporation 
to have a science for kids millennium project at Epcot. We are 
working with the Smithsonian on some potential programs that 
would enhance what we have done to maintain and capitalize on 
the agriculture tradition, but also look at the future and the 
things that we might do to promote agriculture and the 
agriculture sciences.
    We have talked about cutting edge research. One of my 
concerns is that we are not reaching into the K-12 system. We 
need to use the new authority that we have in high school 
agricultural education to create innovative programs that go 
beyond the traditional approach.
    I think that there is ample opportunity to continue the 
discussion on how we, together, facilitate developing this 
scientific, and engineering, and professional cadre that we 
will need in the 21st Century.
    Ms. Kaptur.  I would just like to encourage you to go take 
a couple of hours and stroll through there. Then ask yourself 
if you were a youngster, K-12, going through that exhibit in 
our Nation's Capitol as millions do each year, would you even 
think about agriculture as a career?
    I think a lot of the work that each of you do can have a 
lot to do with changing the image of the vast array of 
opportunities that are available to young people. Certainly, 
you have the science end of it. You understand the education 
piece of it. You have spent your life doing this.
    I would just want to encourage you on in that effort and 
you would find a friend here.
    Dr. Gonzalez.  Thank you.

                                Gleaning

    Ms. Kaptur.  I have one additional question. If you could 
be very brief, then we will let other members question.
    You have talked about this Gleaning Initiative; community 
food security being one of your efforts. I would have to say 
that some of that is a wonderful idea and I support it.
    We have an immediate need in this Country, however, for 
instance in the hog market and in some of the cattle markets 
where we have got problems with people burying animals, farmers 
burying animals.
    I would hope that you might take a look at gleaning, not 
just being plant crops, but perhaps livestock and ask 
yourselves some serious questions, what could be done in this 
fiscal year to move some of that product into our feeding 
kitchens.
    You may already be doing this. I am very troubled by what I 
see happening. We could lose up to one-third of our producers 
in the hog area. I just do no think we should do that as a 
Country; particularly looking at this, which is very revealing.
    Dr. Gonzalez.  We are using a broad-based approach bring 
the Department's agencies together with State Departments of 
Agriculture and community groups to look at all of these issues 
as you have indicated.
    Ms. Kaptur.  All right. Thank you, Mr. Chairman, very much.
    Mr. Kingston.  Mr. Bonilla.
    Mr. Bonilla.  I believe Ms. Emerson was here earlier.
    Mr. Kingston.  I came in after both of you all. So, I was 
not sure, but I stand corrected.

                               Aflatoxin

    Ms. Emerson.  Thank you, Mr. Chairman.
    I thank you all for coming today. My first question goes to 
Dr. Horn and it has to do with aflatoxin. Specifically, what 
type of programs do you have available to farmers to give them 
more information on aflatoxin, particularly as it relates to 
corn?
    My farmers had a horrible time last year, particularly with 
trying to get information about what to do about storing their 
corn, how to keep it away from everything else. They were not 
able to get a whole lot of information.
    We requested information from you all and we got this, as 
well as some other verbal discussions. How do you go about 
marketing this to producers, if you will? Do you do it through 
the Extension Service, or through FSA Offices?
    It seems that with all of the good information you have 
here, my producers have no access to it.
    Dr. Horn.  The research program has been well-underway for 
a number of years. Some of the rules have changed during that 
period. It still is a very serious food safety issue dealing 
with a carcinogenic compound that affects cotton seed corn--and 
tree nuts.
    The South is particularly vulnerable, but it can occur 
anywhere in the U.S. The Food and Drug Administration has 
limited aflatoxin and its derivatives to 20 parts per billion 
in food and most feed to .5 parts per billion in milk, and up 
to 200 parts per billion in feed ingredients in non-lactating 
animals.
    Therein lies the opportunities, if there are any, to work 
with this feed. It is a major trade concern. We cannot export 
corn or other grains that we could not use in the U.S. 
Therefore, there are procedures for diluting this and routing 
it to other uses that are approved.
    It requires a great deal of logistical support that is way 
beyond the reach of our research programs here. The support is 
in fact through the State Departments of Agriculture, through 
the Action and Regulatory Agencies of the USDA, the Agriculture 
Marketing Service in particular, and through the Extension 
Service.
    There should be assistance available all the way down to 
the grain elevators and so forth that allow us to properly deal 
with an excess of 200 parts per billion in the grain supply and 
safely, truly safely, market these products.
    We are well-aware of the issues in this regard because we 
are frequently accused by Mexico and other countries of trying 
to export grain that is too high in aflatoxin. It is a seasonal 
issue. It is highly variable from one year to the other.
    It is a problem that moves around. Therefore, the 
infrastructure that educates people on how to deal with it has 
to be equipped to move around as well. I am not sure why you 
were unable to get the information you needed.
    I think that some of the research is in place. We are, in 
fact, developing new techniques though, competitive exclusion 
techniques, and other things that will help us to eliminate the 
presence of high levels of aflatoxin in grain. In the long-term 
I think this is something we will be able to solve.

                       Food Price Margin Analyses

    Ms. Emerson.  We hope so. The remainder of my questions 
will go to Dr. Offutt.
    First of all, I am reading your written testimony where you 
talk about systematically investigating the factors that affect 
food prices down along the food chain, if you will.
    Who gets what part of the food dollar? There was an 
interesting article in yesterday's Washington Post where 
actually the head of the Virginia Pork Industry Association did 
in fact do that.
    [The information follows:]

[The official Commmittee record contains additional material here.]



    Do you have that information available for us to see how it 
breaks down?
    Dr. Offutt.  Yes. We look at the question of the 
pricetransmission from farm to retail level across agricultural 
sectors, livestock, grain, as well as fruits, and vegetables. So, we 
have these margins calculated by sector.
    That is really a description of how things break down. I 
think the question we all ask is why are the margins the way 
they are and if they are changing, what is causing the change?
    So, we have good, I would say, static snapshots of what the 
margins are. What we are doing now is trying to understand how 
they are determined and the extent to which margins increase 
because food is processed in a way that consumers demand.
    For example, a margin may increase because the convenience 
of a food has increased through packaging. In the fresh fruit 
and vegetable sector, the packaging of baby carrots or sliced 
pineapple adds to the marketing margin because that is a cost.
    So, we want to understand what actually causes changes in 
margins. That is something we have paid particular attention to 
lately in livestock and fresh fruit and vegetables.
    Ms. Emerson.  So, do you have an analysis prepared yet? I 
mean is it completed? It gets back to Ms. Kaptur's question 
with regard to hogs. I would relate it to hogs and grain, quite 
frankly, for my District.
    Dr. Offutt.  Yes. We will provide you with the margin 
estimates themselves which we do. We have some work on what has 
caused them to change historically we can send you. What I 
would say I am less satisfied with right now is our ability to 
explain why they are changing today, but we do have some 
preliminary analysis to send you, yes.
    [The information follows:]

[The official Commmittee record contains additional material here.]



                          carbon sequestration

    Ms. Emerson.  I would appreciate that. We will follow up 
with your office. Also, in your written testimony, on page 8 of 
yours, I guess, in this whole packet. This has to do with the 
Carbon Sequestration Initiative.
    That is your increase of $700,000 in fiscal year 2000 to 
assess the economic potential of using agricultural lands for 
carbon sequestration. You say this will be in accordance with 
U.S. commitments to mitigate greenhouse gas emissions under the 
Kyoto Protocol.
    We do not have any U.S. commitments because we do not have 
a treaty because it is not ratified by the Senate. So, I am a 
little perplexed about increasing that particular line item in 
your budget considering the fact that we do not have a 
commitment, at least a formal commitment that has been 
ratified. Can you answer that?
    Dr. Offutt.  You are correct, certainly.
    As you know, there is not even an agreement about the use 
of carbon sinks generally in Kyoto, let alone a specific 
binding of agreement about quantities or procedures.
    What we are trying to do is understand the extent to which 
agriculture currently acts as a carbon sink. That is an 
important part of understanding the whole cycle of global 
change and warming. Certainly, the interest in understanding 
the role of carbon sinks is also related to the role of set 
asides that we currently do through the Conservation Reserve 
Program. So, we are really trying to understand it in a more 
general context. I certainly take your point about Kyoto.
    Ms. Emerson.  Then following onto that, obviously we have 
asked, and I have asked specifically, different parts of USDA 
about an economic impact analysis on agriculture if we were to 
ratify the Kyoto Protocol.
    Then it would go into effect. I notice that you have got 
some language in here that refers to that kind of economic 
analysis. Have you done it yet?
    Dr. Offutt.  We have supported the Global Change Program 
Office at the Department level with an analysis of the likely 
impacts of different mitigation agreements.
    Ms. Emerson.  Would you be willing to share that with the 
Subcommittee?
    Dr. Offutt.  Yes. I believe it may already have been 
presented to another Subcommittee up here.
    [The information follows:]

    In response to a request from the Senate Agriculture 
Committee, USDA is preparing an analysis of the economic impact 
of the Kyoto Protocol on the U.S. agricultural sector. The 
report is currently in review and we expect to deliver it to 
the Committee in the very near future. The report examines how 
energy price increases, consistent with the Protocol's 
provisions, affect U.S. farm production, prices, and income, 
and examines the economic opportunities associated with carbon 
sequestering activities. Please contact Margot Anderson who is 
the director of USDA's Global Change Program Office should you 
have additional questions. She can be reached at (202) 720-1977 
or through email at [email protected].

              national research initiative--climate change

    Ms. Emerson.  People seem to have conveniently either 
forgotten or pretend not to know that this exists. So, I am 
happy to know that you all have actually done that.
    One other question and then I will let the next person go. 
I notice in the budget, and I do not know, Dr. Gonzalez, if you 
need to answer this one or not. It talks about the National 
Research Initiative line item.
    It is a 68 percent increase. What part of that has to do 
with climate change? Do you have an idea of how much of that 68 
percent increase goes to climate change? Can somebody there 
give me a line item number for that?
    It is just kind of listed here all by itself. National 
Research Initiative goes up to $200 million. I am just curious. 
That is a huge increase.
    Dr. Gonzalez.  Well, it includes a number of programs. 
Again, going back to the discussion earlier we were really 
happy to have the increase in terms of total research dollars. 
It will be divided up in different program areas.
    I am not sure that I can tell you, unless Dr. Hefferan can 
provide the specific amount for climate change.
    Ms. Emerson.  Can you give me that, Dr. Hefferan?
    Dr. Hefferan. $11.5 million of the increase is for 
environment and agricultural systems. A portion of that would 
be spent on the Climate Change Initiative. Our agency's support 
for climate change is also focused on a UVB monitoring network 
which is supported under a different program.
    Ms. Emerson.  So, how much of that $11.5 million would be 
devoted to climate change?
    Dr. Hefferan. Well, that which is incidental to other 
environmental science. We can try to get an estimate based on 
our current work related to climate change through that 
program. I will have to do a calculation. It is not a major 
program.
    Ms. Emerson.  I understand. I would just like to know that. 
I appreciate it very, very much.
    [The information follows:]

 COOPERATIVE STATE RESEARCH, EDUCATION, AND EXTENSION SERVICE, NATIONAL
               RESEARCH INITIATIVE, GLOBAL CHANGE RESEARCH
                                 [$000]
------------------------------------------------------------------------
                                           Fiscal                Fiscal
                                         year 1999    Change   year 2000
                                          estimate              estimate
------------------------------------------------------------------------
National Research Initiative, Global          $8.6      +$6.0      $14.6
 Change Research.......................
------------------------------------------------------------------------

    Ms. Emerson.  I will let the next person go. Thank you.
    Thank you, Mr. Chairman.
    Mr. Kingston.  Thank you, Ms. Emerson.
    I am not sure if it is Mr. Boyd or Mr. Farr who came in 
next. After the last call, I do not want to get in trouble with 
you guys. Was it Mr. Farr? Mr. Farr.

                      methyl bromide alternatives

    Mr. Farr.  Thank you, Mr. Chairman.
    I am curious, since the signing of the Montreal Protocol 
triggered the phase out of methyl bromide. I have been in 
Congress for 6 years and we have appropriated $98 million for 
methyl bromide research alternatives.
    Do you know how many farmers have moved off methyl bromide 
using the alternatives you found with $98 million?
    Mr. Horn.  As long as methyl bromide is available, we do 
not anticipate that too many will move off of methyl bromide. 
What we are seeing is a number of relatively small operators 
try some of the new technologies that are available and 
actually develop economical ways to market those products.
    A good example is in your bag. We have some strawberries 
that certainly could not fulfill the entire market, but they 
are a very high quality product that could be sold at a premium 
that did not make any use of methyl bromide. We have also had a 
number of cultural algae developed and extended to the organic 
farming community and others that, in fact, do not make use of 
methyl bromide and yet are economical. So, it is a slowly 
emerging, we hope.
    Mr. Farr.  So, we spent $98 million and the only thing we 
have to recommend to get off methyl bromide is to go organic?
    Mr. Horn.  No. The answer to that is much more complex. 
What we are trying very hard to do is develop mainstream 
technologies that will be ready----
    Mr. Farr.  Where are you developing these because I happen 
to be in a County that uses more methyl bromide than any other 
county in the United States. Nobody knows about these 
techniques? Is it being done back here in Maryland?
    Mr. Horn.  Almost all of the work is in California and 
Florida.
    Mr. Farr.  Do you have any indication as to how much is 
being done in the field?
    Mr. Horn.  The only thing that I know we have going on in 
the field is a number of partnerships with large farms and 
small size farms. They are up-scaling this technology and 
improving the efficacy of it in the field. In most cases, 
methyl bromide is still more economical.
    Mr. Farr.  Yes, we are coming up on the phase out date and 
everybody is going to panic because they are going to hit a 
wall without a viable alternative. We are appropriating money. 
We are going back to our farmers and saying, do not worry. We 
have put all of this money in for alternative research, which I 
have been doing for 6 years now. I go home and the farmers say, 
well, whatever they are doing they are not telling us.
    Mr. Horn.  I hope no one is saying do not worry. We are 
extremely worried about this. It is probably the most important 
compound in American agriculture in terms of pest control and 
disease control.
    Mr. Farr.  There is still a big difference. We are going to 
look into this. I want to know where all of that money went. I 
know Ms. Kaptur asked for an audit of that last year.
    You have got to start, and we have even put language in 
there saying that you have got to use this money for in the 
field. There is a big disconnect in America between the 
farmers, the scientists, and the researchers.
    Where there is an economic incentive, it seems to me that 
in this area, there ought not to be that disconnect. We have 
got to start using the capacity that we have in this Country.
    I am going to be looking into that. So, you do not need to 
answer any more questions. I am just surprised that we do not 
even have a figure for how many people moved off of it.
    Dr. Gonzalez.  Could we add another contribution?
    Mr. Farr.  Yes. You can defend yourself.
    Dr. Gonzalez.  Dr. Hefferan.

                   methyl bromide transition program

    Dr. Hefferan.  Well, I just wanted to mention that we are 
proposing a program in our 2000 budget that focuses on thevery 
issue of linking the science to the producers.
    Mr. Farr.  Why are you taking so long?
    Dr. Hefferan.  I cannot answer that question. I can say 
that we are aware of this issue that farmers need to have 
alternatives that may include new management practices and 
other activities. We are proposing to do that through the 
integrated authority in our 2000 budget.
    Mr. Kingston.  If the gentleman would yield for 30 seconds. 
The Subcommittee has something it has to dispose of, of an 
urgent nature.
    Since the birthday girl is leaving the room, I just did not 
want her to escape without the Subcommittee saying happy 
birthday, Rosa. We do not have any cake. We are a little 
disappointed. I see these bags back here that Dr. Horn alluded 
to. I thought they were goodie bags.
    Ms. DeLauro.  Thank you.
    Mr. Kingston.  Mr. Farr.

                            Organic Research

    Mr. Farr.  Thank you for yielding.
    In my District, the ARS station in Salinas has interesting 
capacity to do more organic research. I probably have the most 
certified organic farms in the Country in my District.
    What opportunities have you identified so far within the 
ARS system to pursue dedicated organic research? How will you 
put your plans into action? What funding level and number of 
staff will you dedicate to it?
    Mr. Horn.  The Salinas Laboratory has been important for 
many years in many ways. Most of our organic research, however, 
is done in other places. Most of this has to do with high value 
crops.
    The lettuce program in Salinas has made an effort to 
develop disease and pest resistance in vegetable crops. We have 
done mulching research and other things that would allow us to 
minimize the use of chemicals.
    Of course, there is a very well-organized effort to 
incorporate both the breading program and the cultural 
practices into organic products that demand a premium in the 
market.
    Where we have had quite a bit of controversy is whether or 
not we could achieve these levels of pest control and disease 
control without going to transgenic plants. The issue was 
raised. We got more mail on that subject than about anything 
else a year or so ago.
    The decision has been made to try to pursue an organic 
product that is not transgenic in nature. The jury is out as to 
what will be the long-term implications of that as that market 
grows, as the producers become more aggressive.
    Mr. Farr.  What are you going to do this year? What funding 
levels and number of staff are you going to dedicate to it?
    Mr. Horn.  I may have to get back to you. Let me just check 
something here. I may have to get back to you with the total 
number of scientists involved in organic farming systems.

                            Organic Farming

    Mr. Farr.  While you are looking that up, is there any 
dedicated land within the state experiment stations for organic 
research? Have you been considering using Hatch Formula Funds 
as an incentive for dedicating research plots to organic?
    Dr. Hefferan.  The universities have discretion as to how 
they use Hatch Funds. There is no limitation on their using 
those for organic research. We do not track that. I could not 
answer that question without getting more information for you.
    Mr. Farr.  Do you know what the NRI has done in the past to 
meet the needs of organic industry? Do you know what explicit 
dollar allocation to fund NRI organic proposals has been? Do 
you have any of that information?
    Dr. Hefferan.  Well, we fund research that is relevant to 
organic practices across several programs in the NRI. The 
majority of that would be through our Agricultural Systems 
Program, which last year awarded just a little bit more than $2 
million for systems research, including organics, and which we 
anticipate we will have a substantial increase in systems 
research this year; particularly, to address the needs of small 
and medium size farms.
    We certainly could assess the portfolio of work and see 
what is relevant to organics.
    Mr. Farr.  I would appreciate that.
    [The information follows:]

      Cooperative State Research, Education, and Extension Service

                        organic farming research

    The National Research Initiative offers a Biologically 
Based Pest Management Program which supports research aimed at 
understanding, developing, enhancing, and integrating 
biologically based pest management practices into an overall 
pest management system with the goal of reducing dependency on 
synthetic pesticides. This program supports research that 
applies organic farming principles. Areas of research include 
mass production and implementation methods for biological 
control organisms, factors that conserve biological control 
agents, assessment of alternative pest management practices, 
development of disease warning systems, and use of pheromones. 
Funding support for this program was $1.8 million in 1998. 
Other programs within the Pest Biology division support 
biological control research and other research areas that would 
pertain to organic farming. These programs include the 
Entomology and Nematology program, the Plant Pathology Program 
and the Weed Biology and Management Program. It is estimated 
that at least 30 percent or approximately $4.3 million of the 
research supported in these programs supports organic farming. 
The total support in fiscal year 1998 within the Pest Biology 
Division for organic farming is estimated to be $6.1 million.

    AGRICULTURE RESEARCH SERVICE ORGANIC FARMING RESEARCH BY LOCATION
------------------------------------------------------------------------
                                                    Fy 2000    Scientist
                    Location                        (gross)      years
------------------------------------------------------------------------
Booneville, AR..................................     $289,500       0.8
Fresno, CA......................................      209,500       3.7
Salinas, CA.....................................       134,00        .5
Gainesville, FL.................................      120,800        .3
Orlando, FL.....................................      183,500        .6
Athens, GA......................................      137,400        .5
Tifton, GA......................................      107,500        .4
Peoria, IL......................................      101,200        .3
Ames, IA........................................      161,300        .6
Beltsville, MD..................................      866,000       3.1
Morris, MN......................................      178,000        .6
St. Paul, MN....................................       19,100        .1
Stoneville, MS..................................      202,500        .9
Lincoln, NE.....................................       79,400        .4
Ithaca, NY......................................       71,000        .2
Lane, OK........................................       71,300        .3
Stillwater, OK..................................       56,200        .2
Corvallis, OR...................................      166,100        .8
Philadelphia, PA................................      190,100        .8
University Park, PA.............................      115,400       3.4
Brookings, SD...................................       59,100        .2
Weslaco, TX.....................................      239,800        .8
Pullman, WA.....................................      251,200       1.0
Yakima, WA......................................    1,391,000       2.4
Beckley, WV.....................................      365,600       1.3
Madison, WI.....................................       49,100        .1
                                                 -----------------------
    Total.......................................    5,815,600      24.3
------------------------------------------------------------------------

    Mr. Farr. As you know, it is one of the fastest growing 
market niche in the Country; particularly a high demand for 
export. It is not just small farmers any more. We have a lot of 
large farmers into organic. I appreciate knowing what you are 
doing in that.
    Mr. Horn.  Going back to the ARS Program that you made 
mention of, actually what we are showing is about a $3.5 
billion market annually in the U.S. for organically produced 
foods. That is increasing by 20 percent a year.
    So, it has come to our attention over the past several 
years that they have unique researchable problems. In 
particular, we have been communicating with the Organic Farming 
Research Foundation.
    They have requested our assistance in developing organic 
farming techniques. Salinas is one of the places where we are 
interacting with them. We do have dedicated plots already in 
place and have had for a number of years at Beltsville.
    They may or may not be transferrable technology, but we are 
aware of that need. Of course, the overall effort would be to 
integrate that research with some of the things that we have 
related to maintaining the quality and the productivity of the 
soil, biological control systems, integrated pest management, 
weed management with things like mulching and the like, and the 
sustainability of these systems.
    Mr. Farr.  U.C. Davis has just moved their program from 
Davis to U.C. Santa Cruz, which has a sustainable agricultural 
program at that campus. The market demand is out there.
    We need to have a national protocol through regulations. 
When the Secretary was here, we really went after him on 
getting those rules adopted. I do not think they need to take 
another year or two to do that.
    I think we know enough with the NOSB to get those rules 
adopted right now. The Department is going to have to spend a 
lot more attention on the demand in this field and going to 
have to be more user-friendly.
    As the issues were about methyl bromide, we need to have a 
much greater dialogue and connection between the people that 
are doing the work, be given these statistics about all of 
these farms in America, and some of it is pretty tragic.
    If you are trying to be a start-up farmer right now, it is 
going to be very, very difficult. We have an awful lot of 
farmers who are aging. There are very few young new farmers 
coming into the business.
    These new niche markets are where they are going to come 
in. It is not rocket science to understand that. Yet the U.S. 
Department of Agriculture is essentially as traditional as 
anything can be. The complaint always is that bureaucracies do 
not respond to markets.
    We have got to get the Department to be more involved with 
people who are out there trying to make it in farming that are 
on these cutting edge issues, and get your education and 
research working hand-in-hand with them, not doing what they 
tell you to do, but at least being more assessable.
    The farmers have got to know what you are doing. I will be 
looking at ways in which we can make sure that the budget 
language tightens some of that up.
    Mr. Kingston.  Let me go to Mr. Bonilla right now. I am not 
sure when the next vote is. I think we are getting towards 
borrowed time.
    Mr. Farr.  Thank you, Mr. Chairman.
    Mr. Bonilla.  My first question, I believe, is best 
directed to Dr. Offutt. I have a question about, in our 
Appropriations Bill from last year. Dr. Offutt, we had some 
report language requesting a study by ERS of the economic 
impact on the sheep and goat industry, by the termination of 
the Wool Act.
    The results of the report, were requested by February 15th, 
and we are a few days past that. So, my question is are we 
close to getting that report?
    Dr. Offutt.  Yes, you are.
    Mr. Bonilla.  It may seem obvious as to the effect of 
eliminating the Wool Act, but we need that to document what we 
may need to do for them in the future. They are an industry 
that probably has more than one foot in the grave already. Some 
of these areas are also dealing with an issue that is not in 
your jurisdiction, but the falling oil prices in West Texas are 
also giving them a double whammy at this time.
    So, fairly soon then?
    Dr. Offutt.  Yes.

                    Secondary Agricultural Education

    Mr. Bonilla.  Dr. Hefferan, I have a question now that I 
believe I should direct to you. In fiscal year 1999, our bill 
included $500,000 for competitive grants for secondary 
agriculture education.
    This is a competitive grant that teachers can apply for 
locally, and it is up to them whether they want to apply or use 
any of this money long-term. The Administration has stated that 
education is a national priority.
    In the fiscal year 2000 budget, there is not a dime for 
this project for these competitive grants, as far as we know. 
My question is, why is agriculture education not considered a 
national priority because education is education, after all?
    Dr. Hefferan.  I think it is considered a very high 
priority and it is reflected in a number of the programs that 
we are seeking funding for. So, while it is not included in the 
discretionary budget, the Department is very committed to 
advancing agricultural knowledge, and particularly agricultural 
science and agribusiness through a variety of different 
mechanisms.
    Mr. Bonilla.  Will there be any availability at all for 
these high school instructors then to participate in this 
program? This is a very ripe age that you can grab the interest 
of young people.
    If they are not receiving any kind of assistance like this, 
it makes it a little more difficult for them; would you not 
say?
    Dr. Hefferan.  Certainly. I think Dr. Gonzalez is also 
concerned on that.
    Dr. Gonzalez.  It is very much a part of our discussion. I 
am glad that you raised the question. When we talk about the 
long-term strategy beyond the immediate things that we have 
been able to do, I continue to be concerned about the 
discussion internally. It may be that some folks disconnect 
agricultural education from the total education package.
    I think they have to be part and parcel. We will continue 
to discuss it. From my discussions with the Secretary and with 
the Deputy in the last year and a half, the sense that I have 
is that we have raised the awareness of a lot of others of our 
Departmental team to the importance of research, education, and 
extension. So, it isa part of the dialogue.
    It is continuing. I have not given up yet in terms of 
coming up with some additional ways of viewing it. Also we have 
re-established a relationship with the Department of Education.
    We are looking at some things in the Department of Labor 
that tie-in, such as the farm market community and the 
education needs that they have. So, it is not only in 
agriculture that we need to look for the funding.
    I think we need to look for the team approach to how we 
address educational needs across the variety of departments. 
So, that is a part of the discussion that is going on.
    Mr. Bonilla.  That leads into my next question. I am sure 
that if you had a line item reinstated for these grants, they 
would go to good use; would they not?
    Dr. Gonzalez.  Absolutely.
    Mr. Bonilla.  In tieing in, Dr. Gonzalez, to what you were 
just talking about working with the Department of Education, in 
the last Appropriations Bill we also requested a report on 
USDA's activities and efforts to collaborate and cooperate with 
the Department of Education in providing both technical and 
teaching support for school-based agriculture education.
    My question is when can we expect this report? Would you 
comment on these activities as they exist today.
    Dr. Gonzalez.  We have gone through a process with the new 
authorization and the appropriations that we have in fiscal 
year 1999 to establish the grant program to make the funds 
available to local education agencies on a competitive basis. 
That is still an ongoing process. We are not there yet.
    Mr. Bonilla.  When can we expect the report?
    Dr. Gonzalez.  We hope to have something by mid-April, mid-
April to early May in terms of where we are in that discussion.
    [Clerk's note.--Subsequent to the hearing, the agency 
changed the report release date to Summer.]

                       designing food for health

    Mr. Bonilla.  Okay. When reviewing the new food safety and 
nutrition research projects described under the CSREES budget 
on pages 10 to 37--it sounds very similar to Designing Foods 
For Health Project that was funded in the fiscal year 1999 
budget.
    I am asking if you would please describe any differences 
and why the Designing Foods For Health Project was not included 
in the fiscal year 2000 budget? I am concerned that this is a 
duplication of research projects.
    Why not work with the research that has been ongoing for 
several years in that area? There is a lot of work, for 
example, going on at Texas A&M, and to build on such progress 
that has already been made in this area, rather than creating a 
new line item for something that we are not sure how it is 
going to wind up would be better.
    Dr. Hefferan.  Well, I think the basic answer to that 
question is that the Designing Foods For Health was a large 
program where funding was requested by an institution last 
year, but was not funded.
    The request in the fiscal year 2000 does have some elements 
that relate to designing foods so that they have attributes 
that contribute to health. That is an important part of that 
program.
    I think the reference you are making is a very specific 
project that was proposed by one institution. That project 
could certainly be funded under what is requested in the 2000 
budget. That is a separate and distinct activity from what is 
proposed here.
    Mr. Bonilla.  The project I was referring to specifically 
at Texas A&M is where they have developed a carrot that has 
more beta carotene than a regular carrot. It is known to be a 
cancer preventative.
    Dr. Hefferan.  Yes.
    Mr. Bonilla.  What could be more productive than that?
    Dr. Hefferan.  Well, Texas A&M has shared their overall 
project proposal with us. As we currently operate within the 
programs that we have, the proposal that they have is far 
larger than any of the programs that we currently support, 
could support.
    Certainly elements of what they are proposing at the center 
could be funded through the increased program initiative that 
we have under Designing Foods For Health.
    Mr. Bonilla.  They will be pleased to hear that then.
    Dr. Hefferan.  They are highly competitive.
    Mr. Bonilla.  They do a lot of good work there.
    Dr. Hefferan.  Yes. It is a highly competitive institution.

                             plant research

    Mr. Bonilla.  I have only one last question. I am concerned 
that the budget does not include funding for many ongoing basic 
plant research initiatives. This is approximately a $12 million 
decrease.
    At the same time, the budget includes approximately $15 
million for global climate change research. Are you not 
concerned that some of these very important research areas may 
suffer or be lost all together?
    This is consistent with some of the questions we have been 
asking recently at hearings about priorities and what the USDA, 
and other agencies as well at other hearings, should be 
prioritizing.
    It just boggles my mind sometimes that a lot of new 
initiatives that are unproven and, quite frankly, are in some 
cases being suggested for political reasons, are taking 
precedence over some basic research that we need to do.
    Dr. Hefferan.  Well, I can just let you know that withinthe 
CSREES budget, there is a request for $28 million in increased funding 
through the National Research Initiative Competitive Grants Program for 
plant science research, which would both continue a number of the 
initiatives that we have started across the broad spectrum of programs, 
as well as enhance our activities on plant genomics.
    That is separate and distinct from increases that we have 
sought in other areas that might relate to global climate 
change, for example. This is a very high priority for us, as 
reflected in our request.
    Mr. Bonilla.  Again, I think that sometimes getting down to 
fundamentals--you are not going to get to higher levels of 
accomplishment if you do not pay attention to basic 
fundamentals.
    In academics, it is reading, writing, and arithmetic. In 
football, it is blocking and tackling. If you do not pay 
attention to fundamentals, you are not going to be there at the 
end of the game. That is my point. I appreciate your time 
today.
    Mr. Kingston.  Thank you, Mr. Bonilla. Mr. Boyd.
    Mr. Boyd.  Thank you, Mr. Chairman.
    Dr. Gonzalez and members of the panel, I want to take a 
little bit different attack from my friend from California and 
my friend from Texas. I will tell you, first of all, having 
spent all of my professional life in agriculture, I have come 
to the conclusions that one of the major reasons that this is 
the greatest agricultural producing nation in the world is 
because of our research and education arm; the money that we 
spend in those fields, not only developing, but using wisely 
the best fertilizers, the best pesticides, our water, our soil, 
our crop rotation techniques, our equipment technology.
    All of those things I think really makes us the very best 
in the world. So, I really want to direct my question to Mr. 
Bay sitting on the other end who is not in the research and 
education arm, but in the information gathering section, I 
guess you would call yourself.
    In this era information technology changes on a daily 
basis. How do we convince our farmers, our constituents that 
your shop is staying up-to-date and continues to serve a useful 
purpose in this era where information on almost anything you 
want to know about is available almost at the finger tip? Could 
you elaborate on that a little bit? Sell me.

                            nass statistics

    Mr. Bay.  I really have not been asked that question 
before, I will have to admit. It seems like that the basic 
statistical information that we come out with, which is the 
basic crop and livestock supply numbers is not available 
anywhere else. I think the industry still looks to our numbers 
as being the official numbers when it comes to the crop and 
livestock statistics. I think the same thing can be said for 
the economic data.
    We are the only ones that are able to do a thorough survey 
in cooperation with ERS to really cover enough farms to be able 
to look at the different segments of agriculture economically.
    So, I think the relevancy is still there. Sometimes, we are 
the messenger of bad news. Sometimes it is good news. Right 
now, there has been more bad news lately than good news. We are 
just the messenger that provides the numbers.
    I still think the numbers are very important to have an 
efficient marketing system. As we get more and more into the 
export markets, we hear more from the companies that are 
involved in exports that they need numbers to be able to sell 
their products around the world.
    Mr. Boyd.  So, you still consider your major role that of 
providing numbers on livestock inventories, crop data, acres, 
yields, so on and so forth.
    Mr. Bay.  Yes. In recent times, some of the newest things 
that we have been asked to do is more in the environmental area 
on pesticide use and agricultural practices.
    Mr. Boyd.  I noticed that. I guess that was one of the 
reasons I was asking the question.
    Mr. Bay.  So, we have responded in that area. I think we 
have established a reputation with those that use the numbers 
as having very credible numbers. So, I think we will probably 
continue to have a demand for more and more information in the 
environmental area.

                         small farms initiative

    Mr. Boyd.  Mr. Chairman, I will have one more quick 
question. I want to use one of the numbers that I found in your 
fax. That one is really disturbing. Like you say, you are just 
the deliverer of the news.
    From 1997, the under 35 age group and percent of farm 
operators dropped from 11 to 8. That is almost a little over a 
25 percent increase, I guess. Really my question then would go 
to Dr. Hefferan because I noticed in your testimony on page 5 
you talked about a Small Farms Initiative spending $4 million.
    We have lots of those initiatives around currently. What is 
it that your shop is proposing to do differently that maybe can 
help us turn this statistic around?
    Dr. Hefferan.  Well, one of the attributes of that program 
is to provide information for emerging farmers, people who are 
entering into farming to both establish their skills and to 
maintain their skills; particularly on small operations.
    What that program is really about is taking the knowledge 
that we have collected and developed for years and years and 
making it useful, regardless of the scale of your operation. So 
that the techniques and the science that we have that has 
generally been applied primarily on large scale operations can 
be adjusted, revised to make it useful if you have an operation 
that is a mixed operation, an operation that is not focusing on 
just one particular crop, or maybe looking at a wide range of 
issues related to marketing where you know how to grow a crop, 
but you do not know how to sell it.
    So, that program is designed to essentially take the 
knowledge that we have and make it useful to people who want to 
remain in farming and operate small and medium operations to do 
so.
    Mr. Boyd.  You will be doing this through your State 
Cooperative Extension Service?
    Dr. Hefferan.  That would be a primary source of delivery. 
There are other organizations that also have an interest in 
helping small and medium size farmers. It is also related to 
some of the work that we do through our Sustainable Agriculture 
Program.
    There are a lot of interconnections among those programs. 
One attribute is to help people who want to enter farming, have 
the information they need to be successful.
    Mr. Boyd.  Thank you very much, Mr. Chairman.
    Mr. Skeen [presiding]. Mr. Nethercutt.
    Mr. Nethercutt.  Thank you, Mr. Chairman.
    Welcome ladies and gentlemen. I want to compliment youon 
part of your budget that have been submitted this year. For the first 
time, I think, since I have been here, you did not cut the Prosser 
Research Station in Prosser, Washington and the Mandan Station.
    So, we kept putting it in and you kept cutting it. So, I am 
glad someone got the message that this is what the Subcommittee 
wants. These research stations do good work. I compliment you 
on that.
    I also appreciate the fact that there is an 8 percent 
increase in agriculture research this year, as opposed to I 
think an $81 million reduction last fiscal year. The good and 
the bad about that is it is good that the numbers are increased 
for research because I think it is so vital for production 
agriculture across this Country.
    It looks like much of the increase is devoted to the global 
warming and that sort of environmental side of agriculture, as 
opposed to the research on the ground that the farmers, I 
think, so desperately need in order to produce food and fiber 
in this Country.
    I also take it that the budget does not reflect priorities 
of your agencies as opposed to the priorities of the 
Administration/Office of Management and Budget. Am I correct on 
that?

                          research priorities

    Dr. Gonzalez.  That is correct.
    Mr. Nethercutt.  I understand the way that happens. I am 
not here to beat up on you necessarily, but to make the point 
that I think it is ill-advised in the way it has come out with 
respect to the priorities that are set forth in the budget.
    What bothers me about the budget that you have presented is 
the reduction, the decreases in special projects for ARS and 
CSREES. I see in your statement that there is a reference to 
the justification for the decrease to finance higher priority 
agriculture research in the President's budget.
    Again, we can differ about which is higher priority, but I 
assume you mean higher priority research relating to carbon 
sequestration and global warming. Am I correct on that or is 
there other higher priority agriculture research in the 
President's budget?
    Dr. Gonzalez.  They probably include the broader category 
of research priorities, as we work through the discussion 
internally. I will not speak for the Administrators, but I 
think they could tell you with more specificity what that means 
for ARS and CSREES in our research.
    Mr. Nethercutt.  Could we do that for the record since I am 
very short on time? We have a vote. I do not want to 
inconvenience my colleagues here or do you wish to say 
something?

                         production agriculture

    Dr. Horn.  One of the things that I think we should point 
out is that a lot of the food safety issues, for instance, are 
of extreme importance to production agriculture.
    Cattlemen have told us that E-Coli 0157H7 is their number 
one problem and solid waste management is a close second. So, 
there are things in the initiatives presented as Departmental 
or Administration initiatives that are in fact extremely 
important to production agriculture.
    Mr. Nethercutt.  I think in today's farmer world, we have 
to have a quick response to problems that exist in the field. 
That would help the farmer more than anything.
    I do not think the private funds or the State Agriculture 
funds are adequate to compete with the Federal funds. In other 
words, the Formula Funds have been cut by around 10 percent 
this year, I think, and the special research grants are cut by 
$51 million.
    The farmers need this assurance that there is going to be 
somebody in the ARS Office in the way of researchers. I heard 
testimony earlier about the number of people who are retiring 
and getting new people in.
    If you are going to plan for a long-term research problem, 
you have got to have the infrastructure and the facilities in 
order to do the research. That means sustainable Formula Funds 
that go to our Land Grant Universities, as Ms. Kaptur mentioned 
and others.
    I just think it is critical. I think that is the wrong 
place to cut. We had a researcher at my alma mater, Washington 
State University, Dr. Rolly Line, who is the only ARS scientist 
in the country who studies the control of rust on wheat and 
barley; the only one.
    Rust research is a continuing necessity because of the 
constant mutations that go on. We need to have somebody now and 
in place, rather than through a competitive grant process.
    I am going to fight hard on this Subcommittee for 
increasing the Formula Funds and on maintaining fewer 
competitive grants and more Formula Fund monies.
    Also, I want to make sure the special grants are there to 
address, as need be, the problems that face the farmer. I will 
stop there, Mr. Chairman. Thank you.
    Mr. Skeen.  The Subcommittee will be in recess to vote. 
Thank you.
    [Recess]
    Mr. Skeen.  The Subcommittee will come to order. Your 
program's problem is because we have been careful to be certain 
that work was going toward the real world. These were priority 
problems. The budget proposes to redirect the money from 
special research projects to competitive efforts.
    The following statement appears many times in your budget 
justification material. ``The Administration strongly believes 
the most effective use of the taxpayer dollars is through 
competitively awarded grants.''
    In many cases, this is the only reason given for proposing 
big cuts in programs that have served us so well for so many 
years. Dr. Gonzalez, this reminds me of programs like our War 
on Cancer.
    We spent an awful lot of money there. We have made 
progress, but we have not won the battle. Help the Subcommittee 
understand the Administration's belief that promoting 
competitive grants should be at the expense of other programs. 
If this has been covered before, we will go to something else.

                           budget initiatives

    Dr. Gonzalez.  Thank you, Mr. Chairman.
    The question has sort of been asked a couple of different 
times in different ways with regard to the initiatives.
    Mr. Skeen.  See how versatile you are.
    Dr. Gonzalez.  I think a part of the answer is in looking 
at the set of initiatives that are a part of the administrative 
component, and then looking at ours.
    I would like to ask Dr. Kennedy to respond, since she has 
been involved in many of the discussions at the White Houseand 
with our other Federal partners in the general discussion of research 
and education.
    When we took the few minutes for the vote, she and I talked 
about a couple of things that I think are important to point 
out to the Subcommittee in terms of our deliberations and the 
things that we believe, talking internally within the REE 
mission area, as we have talk with other mission areas in the 
Department, and in our ongoing discussions with the Office of 
Science and Technology Counsel.
    So, if I may, will turn to her for a few remarks.
    Mr. Skeen.  Sure.
    Dr. Kennedy.  Thank you.
    As I have been listening to the discussion, I am sorry Mr. 
Nethercutt is not here because his last question was really 
went to this.
    In the process we use for arriving at our priorities for 
agriculture research, we had a very lively and dynamic 
interaction with a whole range of stakeholders. I would like to 
add that a lot of those interactions were not in Washington, 
but actually in the field. Last spring and throughout the 
summer, as they say, I was on the road and on the road to 
places like Park City, Utah; Sacramento, California; Orlando; 
Kansas City.
    The purpose of those trips really was to find out from the 
point of view of the end-point users of our research--the 
producers, the commodity groups and others--what were the high 
priority issues that they identified.
    I really do see that as our starting point. I think the 
flavor both in building up to passage of the Agriculture 
Research Bill and since its implementation, that the definition 
of what the research agenda should be, should not emerge simply 
or even as a first stop from the Department, nor necessarily 
from the Administration.
    We keep using the rhetoric over and over again that we want 
to have a dynamic responsive agenda. These series of 
stakeholder meetings were really key in helping us craft what 
our agenda was.
    Example. As we look at some new labels or line items in our 
research which may look like Mr. Bonilla's comment, maybe some 
non-traditional ways of looking at research, they really are 
meant to be responsive to what we were hearing as we traveled 
around and had open meetings which were very well-attended. 
What we were hearing from our producer community is they want 
investments in agriculture research that lead to production 
gains in plants sooner. They want disease resistance in plants, 
pest resistance, so on and so forth. Hence, looking at where 
our investment should be.
    Now, the question of why competitively award it? Having 
first established with our stakeholders what the priorities 
should be for agriculture research, we then look at the second 
step, what was the most effective way of getting there.
    Dr. Gonzalez has mentioned very substantive interactions 
with the National Science and Technology Council and the Office 
of Science and Technology Policy where very clearly there is a 
belief that the best quality science emerges from competitively 
awarded funds.
    That is not the only vehicle we are using, but a very 
important vehicle for achieving our goals. The emphasis on 
competitively awarded grant programs only emerged after the 
discussion with our stakeholders, with our partners, only 
emerged after we had a definition of what the priorities really 
were for our research, education, and extension agenda.
    Mr. Skeen.  When you have these competitive thrusts or the 
operation of some kind of research, do you do an evaluation?
    Dr. Kennedy.  Absolutely.
    Mr. Skeen.  That is what I was getting at.
    Dr. Kennedy.  Not only do we do an evaluation on the 
individual grant or project that is awarded, but what we find 
invaluable is where we have defined a particular area of 
research, food safety, community food security, whatever.
    What also is very valuable is building up of the lessons 
learned from the individual activities, individual projects in 
way analysis. So that in fact it is the lessons learned.
    So that after the Government is out of the game of funding 
some of these activities, where is the sustainability? How do 
we build on the information that has come out of the body of 
research and translate it to other communities?
    Mr. Skeen.  So, we are not just doing research for research 
sake? We are really resolving a problem and you are doing 
quantitative and qualitative work along with it.
    Dr. Kennedy.  Absolutely.

                    food assistance program studies

    Mr. Skeen.  On the evaluation of the domestic feeding 
programs, Dr. Gonzalez, your work serves to inform key people 
who make policy and program decisions like Congress, the USDA 
officials, and many others.
    Last year, Congress decided that evaluations of Food Stamp, 
Child Nutrition, and WIC Programs should be carried out in your 
area of responsibility. Specifically, under the Economic 
Research Service.
    Now, the budget proposes to move it back under the Food and 
Nutrition Service. Who made this decision and why?
    Dr. Gonzalez.  Well, the discussions have continued since 
we did this a year ago. We have interacted and tried to provide 
the very best response to the request for doing the research 
and making sure that we have the science base for the way that 
those programs are operated.
    So, it has gone back and forth. We have had the internal 
discussions. We have certainly visited with the Secretary. Dr. 
Offutt and the staff at the ERS have done a tremendous job.
    The mechanism is in place for us to continue that. I would 
ask for her to make any comments along those lines. I think, 
again, there has been discussion internally because it has been 
traditionally within the other mission area and there is still 
that sense that it fits within the broader umbrella.
    Of course, we continue to work on identifying those areas 
that we do well and those done very well by the other mission 
area.
    Mr. Skeen.  Did OMB have anything to do with this decision 
and the action?
    Dr. Gonzalez.  As we go through the proposal of identifying 
those dollars, it was really done centrally in terms of the 
recommendations that went to the Office of Management and 
Budget and the recommendations we got back.
    Mr. Skeen.  So, centralized adjudication and justification.
    Dr. Gonzalez.  Yes.
    I do not know if Dr. Offutt has any other comment that 
could clarify anything else with regard to the question.
    Mr. Skeen.  Dr. Offutt.
    Dr. Offutt.  I do not think so.
    Mr. Skeen.  I have a question for Dr. Offutt, while we are 
warmed up here.
    The ERS has had two successive years in identifying and 
prioritizing the research needs for the Child Nutrition, WIC, 
and the Food Stamp Programs. Would you tell me and the 
Subcommittee what improvements were made to the research 
program? What are the long-term affects of the improvements?
    Dr. Offutt.  Well, I can tell you about the approach we 
have taken in running the program these past 2 years. I will 
leave it to others to decide if it is an improvement.
    We have run the program by our lights as a research agency, 
which means that we have first consulted broadly among the user 
community, as Dr. Kennedy earlier indicated, about what is 
useful.
    We have program managers we have to serve. We have decision 
makers on the Hill; people who have to make decisions about 
programs in the states, as well as those in the non-profit 
community who also serve these populations. So, we have tried 
to be open and transparent in setting priorities and then in 
deciding how to do the work.
    We have tried to cast the net wide. We have looked for the 
best expertise, whether it is at the universities, the non-
profit sector, or the for profit sector.
    We have also made a point to engage other parts of the 
Federal Government. The Food Assistance Program is just part of 
a Government-wide safety net. We think it is important to 
coordinate, for example, with our colleagues at HHS in 
determining whether they are running a survey that we can piggy 
back on to get more bang for the buck.
    So, I think the broad consultation among stakeholders about 
what would be useful is something that, as a principle, we have 
adhered to.
    The broad participation of the research community, whether 
it is land grants or minority serving institutions, as well as 
contractors, as well as non-profits has been another important 
principle that we have operated by.
    We judge the success of all of those efforts by whether or 
not they produce information which is relevant for policy. Are 
we directing our research to the areas that really address the 
concerns that people have, both those who administer the 
programs and those who care more broadly about how they 
function as nutrition assistance, as well as part of the safety 
net.
    Mr. Skeen.  So, it is a justification of what you are doing 
and also an analysis of what kind of quality solutions that you 
come up with. Is it kind of an oversight role?
    Dr. Offutt.  Well, we set the terms on which the research 
is done; whether it is performed internally within the Federal 
Government, or by a university, or a contractor. We are also 
the judges of quality. We have both roles.
    Mr. Skeen.  That is a pretty tough assignment; very 
demanding. Thank you very much. Mr. Latham.

                             formula funds

    Mr. Latham.  Thank you very much, Mr. Chairman.
    I welcome the panel; in particular Dr. Gonzalez, who is 
also an Iowa farmer. Paulina, Iowa is much better off for your 
presence there.
    I was curious, I guess. I think we all understand that the 
requests you are making here today are not really yours. They 
are from OMB. I am just curious. What did you actually request 
as far as Formula Funds, not what OMB recommends? What did you 
actually request?
    Dr. Gonzalez.  I do not remember the specific number. They 
are in the early work that we did. I will ask Dr. Hefferan if 
she would share those with us.
    Dr. Hefferan.  Our request to OMB for Formula Funds for 
research-based programs, including the Hatch Act, McIntire-
Stennis, Evans-Allen, and Animal Health and Disease was 
$225,821,000 for fiscal year 2000.
    For the Extension Formula programs which include the Smith-
Lever-Band Formulas and the 1890 Institutions, our request for 
Band were $272,582,000. For the 1890 Institutions, $25,472,000.

                           competitive grants

    Mr. Latham.  I found it interesting your response about 
doing grants that are for research that is currently done under 
the Formulas, to now do it under competitive grants. I just 
wonder if this is a real wise use of resources.
    I mean, do you not have to start over from square one at a 
new university; set up a new program. You have ongoing programs 
already in place. Then to maybe move it to, on a competitive 
basis, to a university or a college that has never done it 
before?
    Dr. Hefferan.  If I could just say a couple of things about 
the question of competitiveness. First of all, the basic 
capacity in agricultural science, education, and extension is 
vested with the Land Grant Universities and is likely to be 
primarily there. Many of our competitive programs really expand 
the scope of research by pairing Land Grant Universities with 
other institutions that have related capacity that might not be 
on campus. As I mentioned before, most of our competitive 
programs are awarded to Land Grant Institutions.
    Those which are not, are awarded often times to 
institutions that partner or collaborate with Land Grant 
Institutions, including sometimes institutions where we need to 
extend the knowledge base, such as community colleges that are 
training future producers and so forth.
    I think the real issue with the competitive programs in 
addition to those which Dr. Gonzalez and Dr. Kennedy have 
raised is that they allow a focus on high priority problems. 
The question has been raised about whether or not we are really 
able to deliver information relevant to the agriculture 
community.
    When you look at the focus of the competitive programs, for 
example, the integrated authority, it is on issues that we have 
been repeatedly told people are concerned about; water quality 
issues and compliance with a whole array of environmental 
requirements, helping farmers have the tools they need to meet 
the demands of the Food Quality Protection Act, achieving goals 
in integrated pest management which increases both the 
efficiency and minimize the environmental consequences of 
agriculture.
    So, much of this has to do with finding ways to assure that 
Federal dollars are addressing the highest priority national 
issues. We are not proposing that we get rid of the Formula-
based programs. Those are essential to achieving the goals of 
the system. It is really a question of what mix would be most 
effective for Federal support for agricultural knowledge.
    Mr. Latham.  I guess you make my point in that changing the 
people who already have the networks already setup, and 
programs in place, and moving that to another university would 
dissolve that program. You would have to start over.
    You talked about priorities. Obviously, there is a huge 
shift in priorities away from farmer-based research into global 
warming type priorities and things like that which obviously 
are some concern.
    You also have to remember being an appropriator here, we 
are appropriating a lot of money in other committees here for 
that problem also. It simply is, I agree, a matter of 
priorities.
    I do not think from the budget that the priorities coming 
from OMB represent what, like Mr. Farr talked about, the 
connection between farmers and research. That is my real 
concern.
    I would like to associate myself with everything Mr. Farr 
said earlier. There is beginning to be a real disconnect. That 
gap, according to the President's budget, certainly gets much 
wider. Under the proposal, the NRI receives about an $80 
million increase.

                          nri carryover funds

    In the justification, there is about a $39 million carry 
over, unobligated funds. How can you justify such a large 
increase and you have a $39 million carry over?
    Dr. Hefferan.  Well, that $39 million carry over is really 
an artifact of the fact that there is no year authority for the 
program. The $39 million is not our current carry over balance.
    That is the final processing of awards that were decided on 
the 1998 base of funds. I believe we currently have about $1.9 
million still unobligated. There is not that much carry over in 
that program.
    All of those programs were fully reviewed and recommended 
for funding by the end of the fiscal year 1998. What you see in 
the document represents the flow of funds out of the agency for 
those awards. Let us say there is less than $2 million 
unobligated as of today.
    I can add, in that regard, the increase in the NRI is 
really focused on a lot of what you are identifying. That we 
need to have more programmatic, larger sustained programs that 
really address concerns of farmers.
    One of the things that the increase request allows us to do 
is to make larger awards to multiple institutions to really 
address complex problem solving, and not simply make awards for 
individual investigator initiated work. I am not suggesting 
that, that kind of work is not important. The growth in the NRI 
is to really focus on those large problem areas that need a 
more sustained and complex effort.

                               oig audit

    Mr. Latham.  Last year, the OIG recommended that the CSREES 
make some changes to the Competitive Grants Program's process 
in an effort to ensure fairness. According to them, from 1993 
to 1996, 25 award recipients received 25 percent of the awarded 
funds and were represented on more than 52 percent of the 
review panels.
    Have you done anything to change that?
    Dr. Hefferan.  We have.
    Mr. Latham.  Basically, you are having people sitting on 
the board rewarding themselves.
    Dr. Hefferan.  We do have conflict of interest practices 
that we have had in place for a long time that avoid the 
problem of individuals specifically making awards to 
themselves, or to their institutions, or those with whom they 
work.
    Mr. Latham.  How long have they been in place?
    Dr. Hefferan.  Since the initiation of our Competitive 
Grants Program 21 years ago.
    Mr. Latham.  These figures are from 1993 to 1996.
    Dr. Hefferan.  Right. What they are really referring to, it 
in fact goes back to the issue that you raised earlier, is that 
our capacity in agricultural science is primarily vested with 
our Land Grant Institutions.
    I should first say that we have made changes in the way we 
manage the NRI in a number of ways. We are currently undergoing 
a review by the National Research Council of the management of 
the NRI and the long-term practices related to it.
    We have expanded our panels to include a broader range of 
scientists to ensure that we are not simply having scientists 
make decisions about a small cadre's work of which they are a 
member.
    Mr. Latham.  When were those expanded?
    Dr. Hefferan.  When?
    Mr. Latham.  When did that happen?
    Dr. Hefferan.  This year's panels, which are just beginning 
to meet, include a broad range of scientists. Again, the 
capacity in agricultural science is concentrated in the Land 
Grant Institutions and in a program that is driven by experts, 
many of them come from that same set of institutions that 
ultimately receive awards. Seventy-five percent of our NRI 
awards last year were made to Land Grant Institutions.
    The capacity and the science in that area is at those 
institutions. So, we ask those people to serve on review 
panels. There is an inevitable relationship between those who 
review the work and those who receive the grants. We also have 
reviewers from outside the universities from ARS. ARS also 
receives grants from the NRI; private organizations and non-
Land Grant Universities as well.
    Dr. Horn.  Could I add something to this discussion?
    The original premise was that the Administration has 
favored competitive grants. Generally speaking, that is true. 
But they have also proposed increases in the Merit Review, Peer 
Review Programs of the ARS.
    We tend to use these terms synonymously, but they are not. 
In fact, what we really are after is a relevant project that 
will solve some problem for production agriculture or some 
other aspect of the national need.
    It has to be excellent in scientific terms. There are a 
number of ways to get at that. We are competitive in the 
competitive grants arena where we are deciding whether or not 
the work will be done.
    For instance, in the Intramural Program, the first job we 
really have is to address the needs of the actions of 
regulatory agencies of the Department. Often times, those are 
not conducive to competitive grants.
    For one thing, we often times have to react very quickly. 
We have to have someone there tomorrow to do something and help 
solve a problem.
    So, it is an entirely different environment. We do peer 
review on every single one of our projects in the intramural 
program with the same kind of qualified talent that deals with 
the Competitive Grants Programs.
    The real strength in the portfolio that we have in USDA is 
the combination of competitive grants where we can issue 
athought provoking request for proposals and let scientists do their 
best to compete, plus the in-house talent that we have to address the 
short-term needs of either the industry or the action and regulatory 
agencies.
    That is our real strength. I think collectively what we 
have been trying to do for several years is point out that the 
problem is not which pot this money goes into, but the size of 
the pot.
    We still only get \2/10\ of one percent of the Federal 
Research and Development Budget in Agriculture That is a--if 
you compare it with impact that we have on life in America.
    Mr. Latham.  I would agree with you 100 percent.
    The little bit we have, we have to spend wisely and with 
the best people. I am not sure we are going to be able to keep 
the best people if they know that their projects are up for 
grabs every year.
    Without any long-term commitment, the best people are not 
going to stick around. There is a lot of outside competitive 
research in the private sector that is there today. If these 
folks think that there is any question that they are going to 
get whacked the next year, they are going to be gone this year.
    Dr. Hefferan.  That is the challenge for us is to manage 
competitive programs so that they are not destabilizing. One of 
the things we have spent a lot of time doing is looking at 
long-term awards, awards that are integrative across 
institutions larger in size so that one can really establish a 
program and have it fully-supported through the capacity that 
we have, rather than solely using a model that breaks up the 
funds into small pieces.
    Mr. Latham.  Is that why you de-fund soy bean research 
every year. You know, it is stuff like that.
    Dr. Hefferan.  Well, that is why our supplemental RFP for 
the NRI was very different than what we had with our base of 
support. We are anticipating supporting projects at the million 
dollar level, rather than the $120,000 level with that 
supplemental funding.

                        agricultural projections

    Mr. Latham.  I need to maybe move on a little bit.
    The global economy obviously has had a huge impact on our 
exports and the whole agricultural economy. Dr. Offutt, I 
guess, would be the one.
    Has the ERS any long-term analysis of the global economy in 
relationship with American agriculture? What do you see?
    Dr. Offutt.  Yes, and we will send you our latest 
projections which we released last week at the Outlook 
Conference.
    [The information follows:]

[The official Commmittee record contains additional material here.]



    Dr. Offutt.  What we anticipate over the next 2 to 8 years 
is a gradual improvement in the world macro economy. Say, 4 or 
5 years out, there are appreciable increases in prices for 
grains, in particular.
    Earlier than that, I think you see a little bit of a 
rebound in livestock. We do still believe that the fundamentals 
of the world market are good for American agriculture, that 
rising incomes overseas and increases in population add up to 
an increase in demand over time for exported goods from the 
U.S. in particular.
    Mr. Latham.  So, you are a long-term optimist then.
    Dr. Offutt.  Yes. We believe the fundamentals are there. 
There is no doubt that there is turbulence imposed on them.

                           agriculture census

    Mr. Latham.  I have not really looked at the census in 
agriculture, but I did my own census where I live on a farm in 
Alexander in Iowa. It is a town of 158 people. I live in the 
suburbs.
    About 3 weeks ago, I sat down just to see for myself what 
was happening. In the four townships around mine and three 
others, I looked back and I could find no one in the last 10 
years who had moved back there.
    I could only find two people who, in the last 20 years, had 
moved back there to farm. These are sections of the highest 
producing land in the world that, even when I was a kid, 
supported the four family farms in each section. There is a 
long-term, obviously, problem in agriculture.
    When you look at the average age of farmers and farm owners 
today, can someone here tell me what we can do?
    Dr. Offutt.  There are two issues. We see since World War 
II that there is not much change in the amount of land under 
cultivation.
    Mr. Latham.  Right.
    Dr. Offutt.  So, preserving productive capacity I think is 
not an issue. It is certainly not a food security issue. It is 
not an issue of competitiveness.
    The question is what the size distribution of farms looks 
like. As you said, the census provides the information. We are 
paying more attention to what these changes mean. Clearly, 
there is a category of farms who are neither very large nor 
very small, who experience stress and exit at rates higher than 
other categories.
    It is also the case that we see family farm corporations 
that may be multi-generational that do quite well. It is 
important not to treat, is important not to treat agriculture 
as sort of a monolithic entity.
    You find great variation across the Country in the way 
farms look and the way people choose to run their farms, 
depending on, for example, where there are off-farm job 
opportunities. We will continue to consider this question of 
exit and entry.
    In some areas of the Country it is also accompanied by de-
population, generally in rural areas. These are long-term 
demographic changes. Recently, there have been reversals in 
rural migration patterns, particularly into areas with natural 
amenities. Whether or not your County in Iowa qualifies, I 
could not say.
    Mr. Latham.  It is a real concern. It definitely changes 
the whole quality of life, health care, and everything else. We 
have the highest percentage of people over 85 in the Country in 
my District.
    Over 65, I think, we are the third highest. Our 
reimbursements, say, on Medicare and things like that, we are 
the lowest in the Country. When you move back to Paulina, we 
want to take care of you.
    Dr. Gonzalez.  Recently, I visited a small farm, 300 acres, 
that I think is an example of farms of the future.
    The young man who was operating the farm has an MBA. It is 
sort of a family operation. The sister has the IT, information 
technology background. The brother is a microbiologist handling 
the processing side of that agenda. The dad supervises all of 
this. I think when you look at the structure of future farm, in 
terms of what small business or business in general has done, 
that is you capitalize on the talent of a number of people in 
the sense of a team to operate that enterprise.
    I think some of our challenge for getting young people 
involved in production agriculture in whatever that new format 
is, is to explain that we need all of that talent in its 
various components to be able to keep this enterprise alive and 
well.
    Mr. Latham.  There are a lot of parts to it. You have to 
have availability and capital. You cannot get in today on a 
small farm and survive. The other statistics I hear about the 
old people, the fact of the matter is, too, that we have the 
highest percentage of both spouses working in the Country.
    Dr. Gonzalez.  We are going to have a couple of those old 
people from Paulina come visit you week after next.
    Mr. Latham.  Good. Thank you very much. I look forward to 
that.
    Thank you, Mr. Chairman.
    Mr. Skeen.  I will just make one observation. You know what 
makes agriculture such a tough way of making your livelihood? 
It is that everything you buy, you buy retail and everything 
you sell, you sell wholesale.
    We are in the wrong kind of business. We need to get folks 
to come out to the farms. Ms. Kaptur, I have run out of all of 
my wise sayings.
    Ms. Kaptur.  Mr. Chairman, you can come up with that every 
time. I mean you just have a lot to teach all of us.
    Mr. Skeen.  Well, you have got a lot of class. We want it 
reflected on us.
    Ms. Kaptur.  I am going to try real hard to meet that 
demand. Overall, I have enjoyed Tom's discussion about what is 
happening to rural America and to our farm families.
    As I look at your Research, Education, Economic, and 
Strategic Plan the word that is missing in the five major goals 
is ``farmer.'' That troubles me because there are a lot of 
other interesting words that are in there, such as 
``agricultural system.''
    That is such a faceless creature. It is sort of like the 
word ``corporation.'' It is a place where you do not have to 
build community. Where you do not have to take responsibility.
    Words like ``highly competitive.'' If I look at what is 
happening in Ohio, the agricultural system for egg production 
is now the primary one in our Country, with the addition of 
industrialized egg production.
    So, we can have an operation that has a million laying hens 
and about to get two million, and it can wipe out all of the 
farmers in our State who produce eggs because Kroeger then 
chooses to buy only from BuckEye Foods, which used to have a 
different name. It is a German company that moved into Ohio. We 
can have an agricultural system that is competitive on the 
global economy, but we are going to have very, very few 
farmers.
    I guess what I would like to see USDA grapple with is how 
do we have a more diversified system of production? When I look 
at this wonderful piece of information that Mr. Bay helped to 
produce and I look at the distribution of farms by sales, you 
see the percent of farms, the largest obviously being people 
who are able to eke-out under $10,000 in income.
    There are some who might say, ``well let us get rid of 
those. I mean those people, obviously, they are no good because 
they only produce 2 percent of the sales in the Country.'' They 
are the most of them. But for some reason, they are not making 
it.
    I bet you if you surveyed those people and you asked them 
if you could manage to remain in agriculture and give up your 
city job, would you? I would bet the majority would say yes.
    That we have had to do these other things in order to try 
to prop up our own farm economy. So, I guess I am very worried 
in looking at that chart that we, as a Country, seem to be 
falling into a pattern of saying, well gosh, if 42 percent of 
sales come from the farms that have $1 million or more in 
sales, it seems like the whole system is just going that way 
and there is not a lot of ingenious work being done in areas 
like what our Chairman talked about which is why do we not have 
systems that help people to buy wholesale as well as sell 
wholesale, rather than just buy retail and sell wholesale?
    The very structure, the economic structure, Dr. Offutt, is 
what needs more attention from USDA, in my opinion. As I sit 
here today as a non-farmer who greatly respects those that 
produce in the agricultural and manufacturing sectors of this 
Country, not service.
    The majority of people in my District have service jobs. 
The production people in agriculture or in industry, what is 
really happening is that their value to this society is being 
under-valued and minimized.
    So, as I sit here today, there are hog farmers, pork 
producers in my District who are burying animals. I will tell 
you, I feel in the position of a beggar because I say to the 
Secretary of Agriculture, you know, Mr. Secretary, I have got 
all of these people, and I do not have the only State with this 
problem.
    We have got feeding kitchens with no food. I have farmers 
in my District burying animals, come on. There has got to be an 
answer, not 5 years from now, but now to help these people 
survive. They talk about long-term credit extension, you know. 
They have got to survive this year.
    It just seems to me that we are too complacent in thinking 
anew about how to create the structures to help these people 
fight in a system that is global and highly competitive.
    I really view what we have done, as a Country, under both 
Republican and Democratic Administrations in recent history, is 
just caving in, just caving into the way the system is.
    It is very disturbing to me. I have letters in my folder 
here from farmers in my District who are suffering now; people 
who have been productive people who have no way to get product 
to market, except through the very narrow eye of one or two 
processors over in Indiana.
    We do not have any slaughter facilities left. Yet, we have 
all of these people, these researchers around the Country and 
all of these highly paid people, including myself, we do not 
have a solution for them.
    They are going out of business. I think if I have a message 
for you, it is be creative and innovative in your work. Do not 
forget the word ``farmer'' in the major goals of the REE 
strategic plan.

                            farm definition

    I take offense at that being missing. I really do. I was 
going to ask Mr. Bay, I wonder if you ever have any 
intellectual crisis in your own mind, any conflicts, when you 
try to figure out who is a farmer and what is a farm?
    Here, there seems to be an acreage prejudice. But if I 
raise mushrooms in a cave in Pennsylvania, and I have to havemy 
product approved by the Pennsylvania Department of Agriculture, am I a 
farmer, if I actually do not farm?
    Mr. Bay.  Yes.
    Ms. Kaptur.  I farm in a cave, you know, I do not really 
have a big spread. Am I a farmer?
    Mr. Bay.  If you raise mushrooms, you are a farmer.
    Ms. Kaptur.  I am a farmer. What if I have apples and I 
make applesauce. I have some dehydrators and I dry that 
applesauce out. I had one woman say I even add jello to it, and 
boy you put that in plastic and that is the best dried apricot, 
dried apple, and dried fruit product you could have.
    I do that in my kitchen, I do not have a big farm. I do not 
raise my own apples. Am I a farmer?
    Mr. Bay.  Do you sell it?
    Ms. Kaptur.  You sell it. Yes, you sell it on a farmer's 
market.
    Mr. Bay.  Do you sell about $1,000 a year?
    Ms. Kaptur.  They sell about $1,000 a year.
    Mr. Bay.  Yes.
    Ms. Kaptur.  So, they would be a farmer.
    Mr. Bay.  We would count them as a farm.
    Ms. Kaptur.  What about a hydroponic greenhouse grower or 
those strawberries that we got in our bag there? Those people 
would be farmers under your definition?
    Mr. Bay.  If they are producing a farm product and selling 
it for a market, yes.
    Ms. Kaptur.  Now, when I go to an operation like BuckEye 
Foods with one million laying hens, are they a farmer or are 
they an industry?
    Mr. Bay.  Well, we still consider them a farmer if they are 
producing a farm product.
    Ms. Kaptur.  Well, this is where I want to get to you 
because this is something where I have an intellectual problem 
on thinking about that. When I think about the poultry people 
in my District that might have three barns, three coops and 
they raise maybe 16,000 hens.
    Then they have to compete against two million laying hens 
three counties away, it is a long stretch for me, even though 
the industrialized agricultural company produces a lot more for 
the market.
    It is hard for me to see them as a farmer. So, I would be 
real interested if you could provide for the record some of the 
intellectual meandering you might have as you try to define 
what is a farmer and what is a farm. I think it would help me 
in my legislative work here.
    [The information follows:]

                          Definition of a Farm

    A farm is defined as any establishment from which $1,000 or 
more of agricultural products were sold or would normally be 
sold during the year. Government payments are included in 
sales, and places with all acreage enrolled in the Conservation 
Reserve or other government programs are considered farms. 
Institutional farms, experimental and research farms, and 
Indian Reservations are included as farms. To be considered a 
farm, the place must be operating during the year. NASS does 
not maintain a definition for determining what a farmer is.

    Mr. Bay.  One of the things we try to do with the census is 
break it down by size, by many different sizes; not in that 
brochure, but in the detailed information that we have so that 
you can look at the different sized farms all together.
    It is hard to exclude somebody just because they are large 
or just because they are small. We have pressure to leave in 
the small ones. We have pressure to also count the big ones.
    Ms. Kaptur.  I think you raised a good point there. I think 
from the economist standpoint, when you talk about a system 
that is highly competitive, for a system to be highly 
competitive, you have to have a lot of producers.
    You have to have equal access to credit. You have to have 
access to processing in market. If you do not have equal access 
to all of those, you are not going to be able to be as 
competitive.
    So, I look at people who produce cattle, raise cattle, in 
my District. When they do not have a slaughter facility, and 
they do not, they really cannot compete. They become a new form 
of rented work for IBP, with all due respect to IBP.
    They do the hard work out on the field, and in the barns, 
and they have to transport those animals. But they do not have 
the economic mechanisms to let them really pool their market 
power with other producers like themselves.
    So, they end up being enveloped by the largest players in 
this system. I question, you know, in the research that you do, 
how much work do you really do on cooperatives? There are new 
forms of cooperatives in this day and age; the new forms of 
credit for small producers that aim at this majority of people, 
but minority of sales.
    Dr. Offutt.  If I could distinguish. The census data that 
you are looking at are traditionally collected according to 
sales class. That is one way of putting farms in different 
categories.
    In conjunction with NASS, we also do a survey of farm 
businesses and farm households. We have a different 
classification, which I will send to you so you can look at it 
more fully. It is in our Family Farm Report to the Congress 
this fall.
    [The information follows:]



[The official Commmittee record contains additional material here.]


    Dr. Offutt.  It divides farms according to their household 
goal. Size may be a factor, but we find, for example, that 55 
percent of the 2.2 million, or 80 farms in the U.S. are 
operated by households whose main occupation is not farming.
    They are retired or they are professional people who run 
some cattle, but by choice work in an urban area. That is 55 
percent of that 2 million. We also have a small category which 
is not farm households but are very large corporations. They 
are primarily found, for example, in California in the fruit 
and vegetable industry. We also have further categories that 
identify limited resource households.
    Some of these people may not even be making poverty level 
income from farming or any other source. Then, we have a group 
of people for whom farming is the significant, if not major 
source of household income, but they also have off-farm sources 
of income, which are important to them.
    So, I want to show you that we do look at the diversity in 
agriculture in a way that allows us to understand whether or 
not people are meeting the goals that they set for themselves; 
whether that is commercial farming or whether it is 
participating in agriculture in only a part-time way, which 
many people choose to do.
    That is a paradigm that allows us to ask questionsabout 
changes in structure and allows us to understand the role of different 
size operations in, as you say, an industrializing sector.
    We would be happy to send up some of the work that we are 
doing on structure and that looks at the richness and the 
diversity in the farm sector in a way that I think is more 
reassuring than looking at it simply by sales class.
    We can identify, even within a group of farms with sales of 
$50 to $250,000, many people who are very successful. I think 
the key in our mission area is to learn from the people who are 
successful, no matter what size they are.
    There are successful small farms and we should understand 
their success in terms of their own characteristics, not by 
comparing them to large farmers. There are people who do very 
well.
    We are trying to understand what it is they do well so that 
we can explain to other people who might be able to use some of 
those same things, whether it is a marketing technique or a way 
of making production decisions.
    I think there are some positive coping mechanisms that come 
out of the kind of research that we do. I think it is the goal 
of this mission area to see that information gets disseminated.
    Ms. Kaptur.  Well, I think I have made my point. I 
appreciate some of the related research that you are doing. But 
what I do not see in most of the testimony that is coming up 
here is any really strong set of initiatives that are different 
from what we have done in the past to address some of the fall-
out we are experiencing in the agricultural sector.
    I do not sense a passion on the part of any of our 
witnesses, to-date. It is not that you do not do a good job at 
what you do. But there is just a kind of drivenness to deal 
with what is a huge fall-out in the farm sector. That really 
troubles me.

                           genetic technology

    It may be that this room is hot and this is not the place 
to talk about that, but I just put that on the record. Along 
these lines, I wanted to ask about an article that was in the 
February 1st issue of Time Magazine dealing with what is called 
``Terminator Technology'' and a Mississippi-based seed company 
called Delta and Pine Land.
    In conjunction with the U.S. Department of Agriculture, 
announced they received a patent on new genetic technology that 
renders farm saved seed sterile. Obviously, you know we have 
heard from a lot of farmers on this.
    I think there have been over 6,000 letters of protest that 
were sent to USDA. My question is why is the Agricultural 
Research Service using scarce research dollars on developing 
technology that will prevent farmers, again a word that is 
missing from the goals that were stated to us, from saving seed 
from their harvest and forcing them into the commercial 
marketplace every year?
    Dr. Gonzalez.  Let me just respond with a general statement 
that we have received the letters. We have had the discussion. 
We have engaged with a number of our research scientists, not 
only internally, but with private sector partners, our 
university community to address these things, and also to talk 
about the policy implications for the entire area of 
biotechnology.
    We know the science and the excellence of the science. But 
there are questions that relate to the implications, whether 
intentional or not, with regard to economic and social 
consequences.
    So, I will ask Dr. Horn to answer more specifically, but we 
have been engaged in this discussion for quite some time.
    Dr. Horn.  This is obviously a very tough, and in many 
quarters, an emotional issue. It should be evaluated on the 
basis of science. But in fact, it has been evaluated on a 
number of other bases.
    This technology was the product of some very excellent 
biotechnology research. ARS worked on this under a Cooperative 
Research and Development Agreement.
    The objective was to find a way to get companies to invest 
their cutting edge technologies in seed production in such a 
way that they could get a return on investment. They could not 
if they were in fact not able to sell seed on a regular basis.
    We entered into this agreement with Delta and Pine Land, 
but there were several other major companies around the world 
involved in very similar lines of investigation.
    One of those I will mention again in a second, is Novartis. 
Low and behold, one of our scientists working with Delta and 
Pine Land found out how to do this and the F-1 Generation does 
not sprout when this is done in a laboratory model system, in 
tobacco; and more recently, we have been able to do this in 
cotton under experimental conditions. The role we play in this 
though is in fact going to be a very positive role.
    If ARS were not co-owners of this patent, then Delta and 
Pine Land, and presumably Monsanto, would own this lock, stock, 
and barrel. They would not have to license or sub-license this 
to anyone else. Our role in this is to make sure that this is 
licensed and sub-licensed to any seed company of any size that 
wants to make use of it. Now, the next important thing to 
understand is that it does not have to be used. It is in none 
of the germplasm that we have released, we have always been in 
favor of the free exchange and use of germplasm.
    None of the things that we release will have this gene in 
it. None of the things that come out of the International 
Research Centers are likely to have this gene included. But 
this is a tool that the seed companies will have access to and, 
as far as we can determine, all of them will consider in order 
to protect their out-of-pocket investment.
    Now, Novartis was following a similar line of 
investigation. They have since the Delta and Pine Land product 
emerged. They have also found a way to do this. So, it was 
close on the heels of this discovery.
    They own that entirely. Novartis is the subsidiary of a 
foreign-owned company. So, that might be just that much worse. 
We have received about 6,000 or 7,000 e-mails. In fact, very 
few organizations have organized this activity. As far as we 
can tell, about 20 percent of the messages are not repeats, but 
a lot of people are truly concerned.
    Many are very emotional messages suggesting that we are in 
fact doing something to the earth, changing the capacity ofthe 
hungry world to feed itself, and so forth. So, we have got a problem. 
Interestingly, there are major programs around the world like the 
Carter Center-driven Sassakowa Africa Association Global 2000 Program 
to feed Africa by providing improved seeds to subsistence farmers to 
enhance food production in developing countries. The idea is to put all 
of the science in the seed so that once you plant the seed, production 
is simplified. The improved seed would be resistent to disease, 
resistent to pests, and by word of mouth, in a developing country you 
can teach people to grow enough to become independent. For this 
scenario to work, it would require use of cutting edge biotechnology 
like this gene system. So, it is not clear that we are doing damage to 
the developing world as well.
    What we have learned though is that biotechnology is going 
to have to be discussed in a far more open forum. We are going 
to have to get societal input.
    In the meantime, we have other programs like using genes 
for appomixis, which is a-sexual reproduction of plants. It is 
in fact natural cloning. We can put a gene into a plant now and 
make it appromictic. We have decided not to enter into external 
agreements with the private sector on the development of this 
technology, but rather to keep it entirely in the public domain 
to make sure that public misunderstanding does not happen 
again, and we can educate people as to our intentions, receive, 
digest, and perhaps incorporate the input of those who are 
worried about these technologies.
    Ms. Kaptur.  Dr. Horn, I appreciate that information.
    In thinking about this issue as to who really owns the 
seed. I was thinking back to our discussion with Mr. Bay about 
what is a farm? Where do you start? How far does it go? How do 
you distinguish different points along a continuum if in fact 
it is a continuum?
    On this one, even though a given company, in conjunction 
with USDA, may discover some way of manipulating a code, a 
genetic code. That company did not invent that genetic code. 
So, the patented portion, for me as a non-scientist and 
somebody not sitting over in the Patent Office, I know I ask 
myself the question, who really owns what in this chain of 
life?
    Dr. Horn.  So do we. This is a very, very difficult legal 
interpretation. It has been of considerable concern to us for a 
long time that varieties of any crop developed at public 
expense can actually come under the complete control of a 
private sector company when they insert a single gene.
    That has happened. Yet, the market drives these events. The 
farmer does not have to buy the seeds with that gene system in 
it because there are many choices and we have a public sector 
source of supply that would allow them not to.
    Mr. Latham.  Would the gentle lady yield for just a second?
    Ms. Kaptur.  I would be happy to yield.
    Mr. Latham.  Could you tell us the percentage of the market 
Delta has? You are talking about being in a competitive 
situation. Do you know what the percentage of the market is 
that they have?
    Dr. Horn.  I am sorry. I do not know.
    Mr. Latham.  Would you be surprised to learn it is well-
over 90 percent of the market. So, there is not a competitive 
factor involved.
    Dr. Horn.  No. I am not surprised. If you are talking about 
Monsanto and biotechnological or transgenic plants, that is a 
typical number. I am not surprised at all. They are getting 
bigger all of the time because of these laws that give them 
ownership of genes.
    Mr. Latham.  This is not just in the genetically altered, 
this is the market share of the seed company; all of the seed 
that is sold.
    Dr. Horn.  I understand that full well.
    Ms. Kaptur.  I thank the gentleman for asking that 
question. I did not know what that number was, but this just 
feeds my own concern even more as to what is going on here and 
who owns the productive flesh, really, of life in food 
production in this Country and elsewhere.
    I appreciate, Dr. Horn, that you are sensitive to the 
public interest issues involved here. Could I ask you, what 
other committees have you testified before in this Congress on 
this issue?
    Dr. Horn.  We have not testified before other Committees on 
this issue.
    Ms. Kaptur.  Is that not amazing.
    Dr. Horn.  The answer would be exactly the same. We are all 
very worried about this. The concentration of the seed market 
is a very serious issue. The legal ramifications of being able 
to patent a gene are that much more serious.
    Ms. Kaptur.  If there is any information that you can 
provide to the record related to this issue, any internal 
working documents, or research regimens, or whatever you have, 
I would be very interested in that.
    Dr. Horn.  We have a good bit of material that has been 
generated in support of trying to analyze the implications of 
this issue. I should say we also have thought about how, if at 
all, we could develop an exit strategy from this.
    Our sense, at the moment, is still that we are very 
important to the public good as co-owners of this patent. If we 
were not there, there would be no need for the big company to 
sub-license this widely.
    So, that is the issue that we are going to have to resolve 
because science does march on. If we do not do it here, someone 
is going to do it somewhere else. If it is privately owned, 
then the farmer is at a disadvantage. I should say though this 
is not totally different from hybrid seed corn. It has not been 
received anything like hybrid seed corn. But with hybrid corn 
you do not get any benefits in the second year either when 
replanting the crop.
    So, there are similarities. But you do not get any yield at 
all in this case. So, there is a difference too. Hybrid corn 
has obviously brought a lot of research investment for quality 
improvements and pest resistance that farmers would never have 
had--and all of the improved germplasm is generated by the 
Department of Agriculture or nearly all of it.
    We provided corn germplasm to everyone to do with as they 
will. All of the seed companies have this material to 
incorporate into their hybrid seed.
    Ms. Kaptur.  Thank you very much. I look forward to any 
other clarification or enlightenment you can give us on that.
    [The information follows:]


[The official Commmittee record contains additional material here.]




    Mr. Horn.  We will do our best.

               International Competitive Grants Programs

    Ms. Kaptur.  All right. Mr. Chairman, I have one final 
question. Relating to the necessity of educating our people to 
the global context in which we work, certainly in agriculture, 
and there is a greater sensitivity to that across our country 
in many fields, hopefully in agriculture.
    My concern is why there was no support recommended in at 
least the budget submission we received from you from the 
Administration for the newly authorized CSREES as International 
Competitive Grants Program for the upcoming 2000 year budget? 
Was that one of the programs OMB eliminated? I really need to 
know this.
    Dr. Gonzalez.  While Dr. Hefferan is looking, I do want to 
tell you that we began this discussion a little over a year ago 
in terms of the global marketplace that we are in.
    We have had the discussions with USAID, with any number of 
the international development banks to take a look at some of 
the goals and objectives of the programs in development, in 
research and education that they are involved with.
    We have assigned some of our staff to work with them in 
developing a plan. We have an Interagency Working Group. Our 
initial recommendation was for some funding in this area, both 
as it relates to the Competitive Grants Program and some 
additional dollars in each of the agencies of this mission area 
to get started on this. It started out as a food security 
discussion. The areas that emerged as important to food 
security were research, education, and extension.
    So, we thought we should be a part of the general 
discussion and certainly proposed some funding to help us get 
started in that.
    I will ask Dr. Hefferan to add other comments.
    Dr. Hefferan.  It took a moment to find it. The agency 
requested $5 million to initiate the program authorized in the 
1998 bill. In addition, we sought to increase the Institution 
Challenge Grants Program, which is the higher education 
program, to give more emphasis on preparing under graduates for 
the growing international nature of the jobs that they will be 
entering. We requested that program be grown to $64 million.
    Ms. Kaptur.  I thank you very much. You have the support of 
this member on that program, even though whatever happened at 
OMB happened, which you cannot talk about.
    I just wanted to end with this comment, Mr. Chairman. I 
really appreciate all of these witnesses. You are the best our 
Country can offer in the public interest to people across our 
Nation in the field of agriculture. We value your service.
    Do not take some of my hard questioning as not appreciating 
you, but an overall concern of how agriculture is getting the 
fast shuffle around this Country. Just hang in there and do not 
forget the farmers in your documents.
    One of the points I wanted to just raise with you here is 
that on another Subcommittee of Appropriations, Foreign 
Operations, I had something to do with some language that was 
inserted there dealing with agriculture in the Newly 
Independent States, and with an entire change in the way that 
USAID will now approach agricultural development there.
    In my own mind, CSREES is the perfect, perfect vehicle 
through which to meet the ground in many of those other 
countries. I would encourage you, with a total rewrite that AID 
has done on its approach, to not shirk from that task.
    I get some indications from some of the people around the 
Country, oh, AID is changing everything. Therefore, we are odd 
man out. No, you might be the right man and woman in.
    So, you should go meet with those AID people. You have the 
kind of comprehensive approach understanding infrastructure 
development at the local farm level that nobody else in this 
Country has.
    So, I just wanted to encourage you the funds available for 
agricultural development are significant. They are not a 
reduction over last year. Do not view AID's change as not being 
welcoming toward you. They were responding to a disappointment 
in this Congress that we have not been able to create a system 
in these other places that can really deal with us to buy our 
fertilizers, buy our input, buy our equipment, and that we have 
some infrastructure development work to do.
    Dr. Gonzalez.  Thank you. And we are well-aware of that 
discussion. We have been engaged in a number of meetings to 
address those issues. I guess to sort of pat the backs of the 
agencies that are represented here, when it comes to the 
Research, Education, and Extension component as it looks at 
international involvement, this is where the talent is. I think 
we said that to them. We are engaged in those deliberations.
    Ms. Kaptur.  Thank you.
    Thank you, Mr. Chairman, very much.
    Mr. Skeen.  Thank you, Ms. Kaptur.
    We thank all of you very much for what you do and how well 
you do it. We appreciate that. I hate to see Ms. Kaptur really 
get mad.
    Dr. Gonzalez.  We like her like she is now.
    Mr. Skeen.  I will tell you one thing, when she says she is 
going to get to the bottom of this thing, she will. Of course, 
I think we ought to drag the IRS in here. I had a friend who 
passed away. His widow was running the farm.
    It is a very small farm. The IRS would not allow her to 
take any of the losses because it is a hobby. Well, we are not 
in the business for it being a hobby. You folks are doing a 
great job of keeping it from being something like a hobby.
    We appreciate this. If we have any further questions for 
the record, we will let you know.
    Mr. Latham.  Mr. Chairman?
    Mr. Skeen.  I beg your pardon. I yield to you. It has to be 
laudatory though. This is wind-up.
    Mr. Latham.  Yes, sir.

                    Public Perception of Agriculture

    We have a very urban Body here in the House. We have a very 
difficult time convincing some of our urban friends what the 
importance of a family farm is. I have a question and you can 
submit it. Give me an answer sometime.
    How do we go to our urban friends here and tell them--I 
come from an area with a concentration of livestock; hogs 
primarily.
    How can we make the point to our urban friends that it 
makes a difference, or does it not make a difference, whether 
that ham that they get or that beef steak comes from a family 
farm or it comes from a large corporate farm?
    What is our argument?
    [The information follows:]

    The American consumers, most of whom are urban, have been 
extremely well served by the family farm system that 
constitutes the vast majority of the farms in the United 
States. Over 98 percent of U.S. farms are family farms. The 
percentage of disposable income that the average American 
spends on food continues to decline and is now below 11 percent 
and is the lowest in the world. We also know that our consumers 
have an incomparable variety and quality of food. This enviable 
situation has been achieved through a family farm system where 
a large number of individual family farmers have dedicated 
themselves to producing food and fiber. As individual 
entrepreneurs they have strong incentives to seek out and adopt 
the latest technologies and continually refine their management 
practices.
    Farming is a diverse enterprise in which individual farmers 
in all 50 States take into account variable natural resource 
and climatic conditions to produce hundreds of different 
commodities to meet ever changing demands of domestic and 
export markets. The Nation stands to lose quality, variety, and 
efficiency if we do not recognize the unique contribution of 
the family farm system to our health and quality of life.

    Mr. Latham.  I think one reason the percentage of the total 
research dollars is so much is that it does not make any 
difference, because food is available on the shelf in 
Manhattan. It does not matter where it comes from. It comes 
from the grocery store.
    Dr. Gonzalez.  I think you have hit on a part of the 
dilemma. The issues are complex. Thinking back to the word 
``farm'', what does it communicate to the community that we 
represent.
    Yet that other 98 percent of the audience that could 
support the things that are important to this food system, what 
do they think? Working together, we need to look for those 
words that communicate; that talk about the importance; that 
bring the passion.
    Perhaps we have not done that here this afternoon, 
describing why the 2 percent of America that produces our food 
is so important to the other 98 percent. We want to come back 
and visit with you about that.
    Mr. Latham.  You will submit the answer?
    Dr. Gonzalez.  Yes, I will.
    Mr. Latham.  Thank you very much.
    Thank you, Mr. Chairman.
    Mr. Skeen.  Well, we have kept you here long enough.
    Thank you so much.
    Dr. Gonzalez.  Mr. Chairman, thank you.
    Mr. Skeen.  We are here to help you.
    Dr. Gonzalez.  And we want your help. Is that the other 
part of the answer?
    Mr. Skeen.  You want the funding; do you not?
    Dr. Gonzalez.  Yes, indeed.
    Mr. Skeen.  Help is on the way.
    Thank you all very much. It has been a real pleasure 
working with you.
    The hearing is adjourned.

[The official Commmittee record contains additional material here.]





                               I N D E X

                              ----------                              

                     Research, Education, Economics

                                                                   Page
Biography of I. Miley Gonzales...................................    33
FY 2000 President's Budget.......................................     5
    High Priority Initiatives....................................    11
    REE Agency Budget Highlights.................................    14
    Synthesis..................................................977-1008
Gleaning.........................................................   110
Global Climate Change. President's Report to Congress...........920-976
Public Understanding of Agriculture............................109, 562
Statements of Dr. I. Miley Gonzales, Under Secretary, REE........ 2, 16
Witnesses........................................................     2

                     Agricultural Research Service

Aflatoxin......................................................110, 603
Africanized Bees.................................................   640
Agricultural Research Service....................................   752
Alcohol Consumption..............................................   637
Animal Health Research...........................................   618
Anti-Drug Research.............................................707, 793
Aquaculture Research.............................................   604
ARS Profile 1998.................................................   763
ARS-Owned Aircraft...............................................   694
Asian Longhorned Beetle..........................................   636
Avian Influenza..................................................   620
Biodegradable Plastic............................................   608
Biography of Floyd P. Horn.......................................    55
Bionetic Corporation OIG Audit...................................   787
Biotechnology Research and Development Corporation...............   609
Budget:
    Fiscal Year 1999 Highlights..................................   752
    Fiscal Year 2000 Appropriation History.......................   576
    Fiscal Year 2000 Extramural Terminations.....................   574
    FY 2000 National Program Initiatives........................37, 215
    Proposal Linkages............................................   786
    Proposed Project Terminations History........................   756
    Request.....................................................36, 567
    Research Projects Contained in Budget Presentation...........   784
    Research Priorities..........................................   214
Canola Research..................................................   713
Centers of Excellence............................................   594
Citrus Root Weevil...............................................   621
Citrus Tristeza Virus............................................   622
Contingency Research Fund......................................700, 710
Cooperative Agreements...........................................   578
Cooperative Research and Development Agreements (CRADA's)........   595
Customers/Clients/Stakeholders...................................   715
Emerging Diseases and Exotic Pests...............................   783
Ergot Disease....................................................   638
Explanatory Notes................................................  1008
Federal Pay Raise................................................   783
Food Safety......................................................   630
    Food Safety Initiative Research--ARS.........................   787
    Postharvest Pathogen Reduction Research......................   583
    Preharvest Food Safety Research..............................   582
Fruit and Nut Research...........................................   612
Fungal Phytase...................................................   639
Genetic Technology...............................................   491
Germplasm--Plant and Animal......................................   622
Global Change..................................................202, 634
Grape Phylloxera.................................................   625
Grape Virology Research..........................................   626
Grasshopper and Mormon Cricket...................................   627
Guayule..........................................................   638
Hog Cholera and Foot and Mouth Disease...........................   607
Honey Bee........................................................   643
Hops Research....................................................   639
Human Nutrition Research..................................584, 631, 708
    Children's Food Pyramid......................................   792
    Phytoestrogen Research.......................................   661
    University Human Nutrition Research..........................   592
Integrated Pest Management.......................................   628
IR-4 Research....................................................   644
Jointed Goat Grass Control Research..............................   645
Kenaf............................................................   646
Lapsed Salaries..................................................   582
Late Blight Potato Research......................................   665
Linkages Between Program and Facilities Requests.................   715
Listeria Research................................................   796
Locoweed Research................................................   646
Low-Input Sustainable Agriculture................................   647
Lyme Disease Research..........................................648, 796
Management Costs.................................................   564
Methyl Bromide Alternatives......................................   204
Methyl Bromide Research..........................................   651
Mushroom Research................................................   654
Narcotics Control Research.......................................   654
National Agricultural Library....................................   709
    Centers......................................................   703
    Leflar School of Law Agricultural Library....................   703
    Library Fees.................................................   701
    Library Object Class Table...................................   702
    NAL Document Delivery Service Activity and Cost..............   702
    NAL Repair and Maintenance...................................   706
National Arboretum.............................................656, 713
New Crops........................................................   657
Object Class Table...............................................   578
Office of Pest Management........................................   566
Organic Farming..................................................   205
Patents..........................................................   597
Peanut Research..................................................   658
Peas, Lentils, and Legumes.......................................   659
Pecan Research...................................................   660
Pfiesteria Research..............................................   633
Phytoestrogen Research...........................................   661
Plant Gene Expression Center.....................................   662
Plum Island Lighthouse...........................................   714
Potato Research..................................................   663
Production Agriculture...........................................   214
Proposed Project Terminations: History...........................   756
Questions Submitted for the Record:
    Chairman Skeen...............................................   564
    Ms. DeLauro..................................................   796
    Mr. Farr.....................................................   798
Research Facilities:
    Backlog of Facility Replacement..............................   697
    Buildings and Facilities...................................714, 755
    Facilities Requirements......................................   696
    New Research Facilities......................................   693
    Repair and Maintenance.......................................   700
    Staffing.....................................................   689
Research Overlap.................................................   673
Research Projects Contained in the Budget Presentation...........   784
Soil and Water Research..........................................   666
Soybean Research.................................................   675
Soybean-Based Ink................................................   677
Staffing of Research Facilities..................................   689
Statement of Dr. Floyd P. Horn, Administrator, ARS...............   784
STEEP II Research................................................   678
Sweet Potato Whitefly............................................   680
Swine Research...................................................   593
Tabular Displays.................................................   747
Taxol Research...................................................   682
Technology Transfer..............................................   682
Tropical/Subtropical Research....................................   684
Urban Pest Control Research......................................   684
Utilization Centers..............................................   686
Viticulture Research.............................................   798
Weslaco, Texas...................................................   696
Wheat Disease....................................................   688

      Cooperative State Research, Education, and Extension Service

1890 Payments....................................................  1289
1890 Facilities Program..........................................  1790
1890 Institutions and Tuskegee University........................  1636
4-H Enrollment...................................................  1786
Aflatoxin Research, IL...........................................  1307
Audits:
    Agency.......................................................  1293
    OIG.......................................................220, 1753
Ag-Based Industrial Lubricants, IA...............................  1309
Ag in the Classroom..............................................  1706
Agrability.......................................................  1778
Agricultural Development in the American Pacific.................  1672
Agricultural Diversification and Specialty Crops, HI.............  1314
Agricultural Diversity/Red River, MN and ND......................  1311
Agricultural Waste Utilization, WV...............................  1674
Agriculture Water Usage, GA......................................  1316
Alliance for Food Protection, NE and GA..........................  1318
Alternative Crops, AR, GA, KS, MT, ND, IL........................  1646
    Canola.......................................................  1647
    Hesperaloe (AZ)..............................................  1648
    North Dakota.................................................  1320
Alternative Crops for Arid Lands, TX.............................  1322
Alternative Marine and Fresh Water Species, MS...................  1324
Alternative Salmon Products, AK..................................  1326
Animal Genome Mapping............................................  1302
Animal Health and Disease Research...............................  1639
Animal Science Food Safety Consortium............................  1328
Animal Waste Management, OK......................................  1676
Apple Fire Blight, MI and NY.....................................  1331
Application/Review/Award Process.................................  1804
Aquaculture Centers..............................................  1644
Aquaculture Product and Market Development, WV...................  1339
Aquaculture research:
    Louisiana....................................................  1333
    Mississippi..................................................  1335
    Virginia.....................................................  1337
Babcock Institute for International Dairy Res. & Development 
  (BARD).........................................................  1341
Beef Improvement, AR.............................................  1709
Binational Agricultural Research and Development Program.....1281, 1346
Biodiesel Research, MO...........................................  1344
Biographical Sketch: Colien Hefferan.............................    83
Biotechnology Risk Assessment....................................  1296
Brucellosis Vaccine, MT..........................................  1349
Budget Request History...........................................  1290
Buildings and Facilities.........................................  1748
Capacity Building Grants Program.............................1636, 1662
Center for:
    Agriculture and Rural Development, IA........................  1678
    Animal Health and Productivity, PA...........................  1351
    Innovative Food Technology, OH...............................  1353
    North American Studies, TX...................................  1680
    Rural Studies, VT............................................  1355
Chesapeake Bay:
    Agroecology, MD..............................................  1357
    Aquaculture, MD..............................................  1359
Citrus Tristeza..................................................  1361
Competitiveness of Agricultural Products, WA.....................  1363
Competitive Grants......................................219, 1632, 1802
    Application Review Award Process.............................  1803
    Directed Research............................................  1803
    Funding for Agricultural Research............................  1805
    International................................................   561
Contagious Equine Metritis, KY...................................  1366
Cool Season Legume Research......................................  1368
Cotton Research, TX..............................................  1370
Cranberry and Blueberry, MA......................................  1372
Cranberry/Blueberry Disease and Breeding, NJ.....................  1374
Critical Agricultural Materials..................................  1642
Critical Issues Grant............................................  1376
Dairy and Meat Goat Research, TX.................................  1379
Data Information System..........................................  1682
Delta Rural Revitalization, MS...................................  1381
Delta Teachers Academy...........................................  1712
Designing Food for Health........................................   210
    Texas........................................................  1383
Diabetes Detection and Prevention, WA and HI.....................  1716
Drought Mitigation, NE...........................................  1385
Ecosystems, AL...................................................  1388
Environmental Research, NY.......................................  1390
Environmental Risk Factors, NY...................................  1393
Expanded Food and Nutrition Education Program (EFNEP)..1756, 1782, 1800
Expanded Wheat Pasture, OK.......................................  1395
Expert IPM Decision Support System...............................  1397
Explanatory Notes................................................  1097
Extension Activities.............................................  1773
Extension Indian reservation Program.............................  1812
Extension Specialist:
    Arkansas.....................................................  1718
    Mississippi..................................................  1720
Fair Act.........................................................  1790
Farm and Rural Business Finance, IL and AR.......................  1400
Federal Administration:
    Classification by Objects....................................  1670
    Peer Panels..................................................  1671
    Grants Summary Table.........................................  1743
Feed Barley for Rangeland Cattle, MT.............................  1403
Fiscal Year 2000 Budget Request............................5, 101, 1290
    Base Formula Funding.......................................101, 218
    History Table.............................................103, 1290
Floriculture, HI.................................................  1405
Food Animal Residue Avoidance Databank (FARAD)...................  1813
Food and Agricultural Policy Institute, IA and MO................  1407
Food Irradiation, IA.............................................  1410
Food Marketing Policy Center, CT.................................  1412
Food Processing Center, NE.......................................  1415
Food Quality, AK.................................................  1417
Food Safety Initiative.................................1419, 1779, 1801
Food Safety, Alabama.............................................  1421
Food Systems Reseach Group, WI...................................  1423
Forestry Research, AR............................................  1425
Fruit and Vegetable Market Analysis, AZ and MO...................  1428
Generic Commodity Promotion, NY..................................  1430
Geographic Information System....................................  1688
Global Change....................................................  1432
Global Change Research Program National Assessment...............  1809
Global Marketing Support Services, AR............................  1435
Grain Sorghum, KS................................................  1437
Grants Awarded in 1998...........................................  1754
Grass Seed Cropping Systems/Sustainable Argic., ID, OR, WA.......  1439
Gulf Coast Shrimp Aquaculture, HI, MS, AZ, SC....................  1691
Hatch Act........................................................  1283
Higher Education Programs........................................  1663
Hispanic Education Partnerships Grant Program....................  1661
Human Nutrition:
    Iowa.........................................................  1441
    Louisiana....................................................  1443
    New York.....................................................  1445
Hydroponic Tomato Production, OH.................................  1448
Illinois-Missouri Alliance for Biotechnology.....................  1450
Improved Dairy Management Practices, PA..........................  1452
Improved Fruit Practices, MI.....................................  1454
Improved Pest Control............................................  1666
Income Enhancement Demonstration, OH.............................  1722
Infectious Disease Research, CO..................................  1456
Institute for Food Science and Engineering, AR...................  1458
Integrated Cow/Calf Management, IA...............................  1724
Integrated Pest Management...................................1461, 1775
Integrated Production Systems, OK................................  1463
Integrated Research, Education, and Extension Activities.........  1766
    Food Quality.................................................  1768
    Methyl Bromide...............................................  1769
    Gleaning..................................................110, 1770
International Agricultural Market Structures and Institutions, KY  1465
International Arid Lands Consortium..............................  1467
International Programs.......................................1788, 1810
Iowa Biotechnology Consortium....................................  1469
IR-4:
    Program and Pesticide Clearance..............................  1303
    Minor Crop Pest Management...................................  1472
Jointed Goatgrass................................................  1476
Livestock and Dairy Policy, NY and TX............................  1479
Lowbush Blueberry Research, ME...................................  1481
Maple Research, VT...............................................  1483
Mariculture, NC..................................................  1694
McIntire-Stennis Forestry Grants.................................  1286
Meadowfoam, OR...................................................  1485
Methyl Bromide Transition Program................................   205
Michigan Biotechnology Consortium................................  1487
Midwest Advanced Food Manufacturing Alliance, NE.................  1490
Midwest Agricultural Products, IA................................  1492
Milk Safety, PA..................................................  1494
Minor Use Animal Drugs.......................................1305, 1496
Mississippi Valley State University..............................  1696
Molluscan Shellfish, OR..........................................  1499
Multi-commodity Research, OR.....................................  1501
Multi-cropping Strategies for Aquaculture, HI....................  1503
Multicultural Scholars Program...................................  1787
National Alternative Fuels Laboratory, ND........................  1699
National Biological Impact Assessment Program....................  1505
National Center for Peanut Competitiveness, GA...................  1701
National Council for Agriculture Education.......................  1808
National Education Center for Agricultural Safety, IA............  1727
National Research Initiative.....................................  1758
    Climate Change...............................................   202
    Carryover Funds..............................................   220
Native American Institutions Endowment Fund......................  1659
Nematode Resistance Genetic Engineering, NM......................  1507
Nonfood Agricultural Products, NE................................  1509
Oil Resources from Desert Plants, NM.............................  1511
Organic Farming..................................................   206
Organic Waste Utilization, NM....................................  1513
Pasture and Forage Research, UT..................................  1515
Peach Tree Short Life, SC........................................  1517
Pest Control Alternatives, SC....................................  1519
Pesticide Applicator Training....................................  1777
Pesticide Impact Assessment Program..............1521, 1664, 1777, 1789
Pest Management Alternatives.....................................  1524
Phytophthora Root Rot, NM........................................  1527
Pilot Technology Project, WI.....................................  1729
Plant, Drought, and Disease Resistance Gene Cataloging, NM.......  1529
Plant Genome Mapping.............................................  1299
Plant Research...................................................   211
PM-10 Study, CA and WA...........................................  1703
Postharvest Rice Straw, CA.......................................  1531
Potato Research..................................................  1533
Precision Agriculture:
    Kentucky.....................................................  1535
    Mississippi..................................................  1537
Preharvest Food Safety, KS.......................................  1539
Preservation and Processing Research, OK.........................  1541
Questions Submitted for the Record:
    Mr. Skeen....................................................  1281
    Mr. Bonilla..................................................  1808
    Ms. DeLauro..................................................  1810
    Mr. Dickey...................................................  1806
    Mrs. Emerson.................................................  1809
    Mr. Farr.....................................................  1811
    Ms. Kaptur...................................................  1810
Rangeland Ecosystems, NM.........................................  1543
Range Policy Development, NM.....................................  1731
Reduction in Congressional Earmarks..............................  1763
Reduction in Formula Funds.......................................   100
Regional Barley Gene Mapping Project.............................  1545
Regionalized Implications of Farm Programs, TX and MO............  1547
Rice Modeling, AR and MO.........................................  1549
Rural Development:
    Centers............................................1551, 1648, 1785
    Oklahoma.....................................................  1733
Rural Economic Development Through Tourism, NM...................  1735
Rural Rehabilitation, GA.........................................  1737
Rural Policies Institute, MO, NE, IA.............................  1555
Russian Wheat Aphid, CO..........................................  1557
Seafood Harvesting, Processing, and Marketing, MS................  1560
Secondary Agricultural Education.................................   209
Small Business Innovation Research Program.......................  1658
Small Farmers....................................................  1810
Small Farms Initiative...........................................   212
Small Fruit Research, OR, WA, ID.................................  1562
Southwest Consortium for Plant Genetics and Water Resources, AZ, 
  CA, NM, TX.....................................................  1565
Soybean Cyst Nematode, MO........................................  1567
Special Research Grants Table....................................  1617
Statement of Colien Hefferan.....................................    71
STEEP III--Water Quality in Pacific Northwest....................  1575
Sustainable Agriculture:
    Michigan.....................................................  1569
    Nebraska.....................................................  1571
    Pennsylvania.................................................  1573
    SARE Program.............................................1649, 1780
Sustainable Beef Supply, MT......................................  1578
Sustainable Pest Management for Dryland Wheat, MT................  1580
Swine Waste Management, NC.......................................  1582
Technology Transfer Projects, OK and MS..........................  1740
Tillage, Silviculture, and Waste Management, LA..................  1584
Tobacco Research.................................................  1296
Tomato Wilt Virus, GA............................................  1586
Tropical and Subtropical Research................................  1588
Turkey Coronavirus, IN...........................................  1591
Urban Pests, GA..................................................  1593
Vidalia Onions, GA...............................................  1595
Viticulture Consortium, NY and CA................................  1597
Viticulture Research.............................................  1811
Youth-At-Risk Program............................................  1781
Water Conservation, KS...........................................  1599
Water Quality....................................................  1602
Weed Control, ND.................................................  1605
Wetland Plants, LA...............................................  1608
Wheat Genetics, KS...............................................  1610
Wood Biomass, NY.................................................  1742
Wood Utilization Research, OR, MS, MI, NC, ME, TN, ID............  1612
Wool Research, TX, MT, WY........................................  1615

                       Economic Research Service

Agricultural:
    Baseline Projections...................................222, 224-354
    Census.......................................................   355
Asian Financial Crisis...........................................   832
Basic, Applied, and Development Research (Public and Private)...835-836
Biography of Susan Offutt........................................    70
Biotechnology: Value Enhanced Crops.............................495-560
Budget Request, History Table....................................   815
Budget and Staff Years...........................................   834
    Geographic Breakdown.........................................   840
    Needs for Small Farm Analysis................................   849
Carbon Sequestration.......................................202, 842-848
    Inventory...................................................843-847
Commodity Market Analyses......................................841, 863
    Electronic Dissemination.....................................   841
    Food Price Margin Analyses..................................111-201
Conservation Program Analysis....................................   214
Data Purchases...................................................   813
Domestic Policy Reforms..........................................   831
    Effects on Commodity Price and Farm Income Viability........817-830
Electric Utility Deregulation Funding Request....................   850
Elimination Plans:
    Reports......................................................   837
    Services.....................................................   837
Energy Related Issues...........................................850-851
Equipment........................................................   808
Explanatory Notes................................................ 1,216
Farmers:
    Family Farm Report...........................................   836
    Household Income............................................809-810
    Structural and Financial Characteristics....................361-489
Food Assistance Research..........................217, 851-852, 860-861
Food and Nutrition Assistance Research............799-808, 852-859, 862
Food Safety:
    Benefits.....................................................   839
    Risk Assessment.............................................848-849
Food Waste.......................................................   840
Foreign Ownership of U.S. Land..................................816-817
Global Climate Change..........................................833, 848
    Carbon Sequestration...................................202, 842-848
    Kyoto Agreement Related Research............................833-834
    National Research Initiative.................................   202
    Treaty Implementation........................................   848
    ERS Research Costs...........................................   848
National Agricultural Pesticide Impact Assessment Program........   812
National Resource Inventory:
    Coordination.................................................   812
    Data.........................................................   812
Nonfarm Earnings and Jobs.......................................815-816
NRC Report on ERS................................................   817
Nutrition Education Initiative..................................813-814
Office of Chief Economist......................................808, 838
Pest Management:
    Data........................................................813-832
    Practices....................................................   811
Questions Submitted for the Record:
    Chairman Skeen...............................................   799
Situation and Outlook reporting..................................   840
Staffing:
    Buyout Authority Use.........................................   838
    Commodity Analyst Employment Changes........................863-864
    Early Out Authority Use......................................   837
    Streamlining Strategy........................................   837
    Support for Office of Chief Economist......................808, 838
Trade:
    NAFTA Report.................................................   815
    Regional Agreements..........................................   841
    Technical Barriers..........................................834-835
Unfunded Mandates and Regulations................................   838
User Fees.......................................................812-813
WIC Cost Containment.............................................   201
Witness Statement of Dr. Susan Offutt, Administrator, ERS........    58

            National Agricultural Statistics Service (NASS)

Agricultural Economics and Land Ownership Survey (AELOS):
    Object Classes...............................................   914
    Obligations..................................................   915
    Use of Data...........................................915-916, 1003
Appropriation Language...........................................  1256
Aquaculture Census...............................................  1265
Available Funds and Staff Years...............................1250-1252
Biography of Mr. Donald Bay, Administrator.......................    99
Budget Requests.................................................885-886
Budget Summary................................................... 84-85
Census of Agriculture (1997):
    Cycle Costs.................................................866-867
    Funding Decrease.............................................  1265
    Response Rates...............................................   868
    Staff Years..................................................   900
    Toll-free Number.............................................   866
Classification by Objects........................................  1254
Cooperative Agreements..........................................874-882
Cooperative Research............................................872-873
Data Collection Costs:
    Horticulture/Greenhouse Pesticide Data......................913-914
    Pesticide Data...............................................   912
Enumerators (NASDA).............................................869-870
Estimates and Reports On-Line...................................891-893
Explanatory Notes.............................................1248-1280
Farms:
    Definition..................................................358-359
    Number of and Land in Farms.................................887-888
Food Quality Protection Act:
    Effects......................................................   917
    Data Requirements............................................   918
Fruits and Vegetables Pilot Survey....................910-912, 979, 991
Geographic Breakdown of Obligations and Staff-Years...........1266-1267
Horticulture/Greenhouse Pesticide Data and Use.............913-914, 917
International Technical Assistance..............................868-869
Justification of Increases and Decreases......................1260-1265
Mann Library.....................................................   891
Mid Atlantic Pilot Project.....................................912, 999
Migrant Workers.................................................888-889
Milk Production.................................................889-890
NASDA Agreement Amount and Employees............................869-870
NASS Budget Summary.............................................. 84-85
NASS Statistics..................................................   212
National Resources Inventory.....................................   868
Number of Farms, Land in Farms..................................887-888
Object Classes:
    Agricultural Economics and Land Ownership Survey (AELOS).....   914
    Fruits and Vegetables Survey.................................   909
    Horticulture/Greenhouse Survey...............................   913
    Mid-Atlantic Pilot Project...................................   912
    Object Class Schedule........................................  1254
    Puerto Rico Office..........................................908-909
Ongoing Services.................................................   872
Passenger Motor Vehicles.........................................  1255
Permanent Positions by Grade and Staff-Year Summary..............  1253
Pesticide Data Collection Costs..................................   912
Pesticide Information............................................   865
Project Statement.............................................1258-1259
Purpose Statement.............................................1248-1249
Puerto Rico Office.........................................908-909, 982
Question Redundancy.............................................918-919
Questions Submitted for the Record: Chairman Skeen...............   865
Reimbursable Surveys............................................883-884
Reports on-line..................................................   891
Salaries and Expenses............................................  1267
Sample Unit Costs................................................   900
Special Surveys.................................................894-897
Staff Year Costs--Puerto Rico Office.............................   909
State Office Funding.............................................   871
Status of Program.............................................1268-1280
Strategic Plan..................................................898-900
Summary of Increases and Decreases...............................  1257
Witness Statement of Administrator, NASS (Donald Bay)............ 86-98
Whole Farm Pesticide Use Data....................................   865
Y2K:
    Computerize System Readiness Report.........................901-907
    Problem......................................................   908

                                
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