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



 
                  AGRICULTURE, RURAL DEVELOPMENT, FOOD
                  AND DRUG ADMINISTRATION, AND RELATED
                    AGENCIES APPROPRIATIONS FOR 2001

_______________________________________________________________________

                                HEARINGS

                                BEFORE A

                           SUBCOMMITTEE OF THE

                       COMMITTEE ON APPROPRIATIONS

                         HOUSE OF REPRESENTATIVES

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND 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 3

                    MARKETING AND REGULATORY PROGRAMS
                        AND CONSERVATION PROGRAMS
                                                                   Page
 Natural Resources Conservation Service...........................    1
 Marketing and Regulatory Programs................................  461
   Animal and Plant Health Inspection Service

   Agricultural Marketing Service

   Grain Inspection, Packers and Stockyards

   Administration

                              

                                ________

         Printed for the use of the Committee on Appropriations
                                ________

                     U.S. GOVERNMENT PRINTING OFFICE
 63-747                     WASHINGTON : 2000



                        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                MICHEAL P. FORBES, New York
 RODNEY P. FRELINGHUYSEN, New Jersey   CHET EDWARDS, Texas
 ROGER F. WICKER, Mississippi          ROBERT E. ``BUD'' CRAMER, Jr.,
 GEORGE R. NETHERCUTT, Jr.,              Alabama
   Washington                          MAURICE D. HINCHEY, New York
 RANDY ``DUKE'' CUNNINGHAM,            LUCILLE ROYBAL-ALLARD, California
   California                          SAM FARR, California
 TODD TIAHRT, Kansas                   JESSE L. JACKSON, Jr., Illinois
 ZACH WAMP, Tennessee                  CAROLYN C. KILPATRICK, Michigan
 TOM LATHAM, Iowa                      ALLEN BOYD, Florida
 ANNE M. NORTHUP, Kentucky
 ROBERT B. ADERHOLT, Alabama
 JO ANN EMERSON, Missouri
 JOHN E. SUNUNU, New Hampshire
 KAY GRANGER, Texas
 JOHN E. PETERSON, Pennsylvania
 VIRGIL H. GOODE, Jr., Virginia

                 James W. Dyer, Clerk and Staff Director

                                  (ii)



   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
                RELATED AGENCIES APPROPRIATIONS FOR 2001

                              ----------                              

                                           Thursday, March 2, 2000.

                 NATURAL RESOURCES CONSERVATION SERVICE

                               WITNESSES

JAMES R. LYONS, UNDER SECRETARY, NATURAL RESOURCES AND ENVIRONMENT
PEARLIE S. REED, CHIEF, NATURAL RESOURCES CONSERVATION SERVICE
DANNY R. SELLS, ASSOCIATE CHIEF, NATURAL RESOURCES CONSERVATION SERVICE
DANA YORK, ACTING DIRECTOR, BUDGET PLANNING AND ANALYSIS DIVISION, 
    NATURAL RESOURCES CONSERVATION SERVICE
STEPHEN DEWHURST, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE
    Mr. Skeen. Well, thank you and good morning. Appreciate all 
of you being here. It's so quiet it is almost like being in 
church.
    Today we want to welcome Mr. Jim Lyons, the Under Secretary 
for Natural Resources and the Environment, and Mr. Pearlie 
Reed, the Chief of the Natural Resources Conservation Service. 
Welcome, gentlemen.
    Mr. Lyons, based on our conversation yesterday, this will 
be the last time that you will be testifying before this 
subcommittee, and we would just like to thank you for your 
service during your time as Under Secretary. Maybe that is a 
faint way of giving you a little endorsement, but we do 
appreciate the work that you have done.
    The NRCS budget request includes an increase of $86.4 
million for conservation operations and increases totaling 
nearly $1 billion in mandatory programs that will have to go 
through the authorizing committee when the administration sends 
up that legislation. It sounds like an ambitious agenda, and we 
would like to hear your thoughts on this.
    But before I recognize you, I would like to turn to Miss 
Kaptur for any welcoming remarks she may have. And I want to 
thank you, Marcy. I understand that you have sacrificed a trip 
back to your district today to be here with us, and I 
appreciate this. This puts us about at the halfway mark on 
these hearings. Thank you.
    Miss Kaptur. Thank you, Mr. Chairman. We couldn't miss the 
hearing of the Natural Resources and Conservation Service. I 
also want to thank Mr. Lyons for his service to our country and 
for your
appearance here today; all of those that you have brought with 
you, Mr. Reed, who has been such a pleasure to work with; Ms. 
York; Mr. Sells; and of course Mr. Dewhurst is here for all of 
our hearings.
    I also want to acknowledge in the audience my former chief 
of staff Bobbi Jeanquart, who now works with the Resource 
Conservation Development Councils around the country. We are 
just so proud of her and the work that she did for our country 
and now working in the volunteer and private sector. I love the 
photos you have given us here.


                              urban sprawl


    Miss Kaptur. This looks like it will be a very good hearing 
this morning. And thank you for everything that you do to help 
to strengthen the ecosystem that we are blessed with in this 
country.
    We recently did a poll in our district, Mr. Chairman, it is 
very interesting, asking citizens about the countryside, about 
urban sprawl, and whether they thought we as a Nation should be 
doing more in order to preserve our heritage and to conserve 
it, and 80 percent said yes. Now, I thought maybe it might be 
40 or 50, and it was just interesting to look at how those 
number came back. So you are part of the most important effort 
in our country to do that, and we welcome you here today. Thank 
you.
    Mr. Skeen. I also want to thank you for the pictures, 
particularly, that one on the front, the sheep look real good 
up against those cattle. They do commingle.
    Mr. Lyons, we will let you have your beginning remarks.

                Opening Remarks by Undersecretary Lyons

    Mr. Lyons. Thank you, Mr. Chairman I appreciate the 
opportunity to be here with you this morning. And, Miss Kaptur 
and Mr. Farr, since we didn't have a chance to meet before the 
hearing, I want to assure you my comments to Mr. Skeen about my 
decision to move on after this year and explore other 
opportunities to contribute in the natural resource field is by 
no means a prediction about the election, it is simply a 
personal decision to move on and hopefully find other ways in 
which I can help.
    I do want to depart radically from my testimony this 
morning, Mr. Chairman, and simply ask that that be made a part 
of the record, if I may.
    Mr. Skeen. We don't have too many radicals in here, but you 
want to be one, go ahead.


                american conservation in the new century


    Mr. Lyons. I am showing my true colors, I guess. But I want 
to focus on three things this morning of concern to the 
committee, I think, as Miss Kaptur noted in her opening 
remarks, of concern to the citizens in the United States, I 
know, from conversations with Mr. Farr, brief conversations 
with Mr. Bonilla, concerns that stretch from coast to coast, 
and that is the way America and Americans view the future of 
conservation in the United States as we face the threshold of 
really what is our second century of American conservation.
    The conservation movement, of course, began in the early 
1900s. Pioneers like Teddy Roosevelt helped to bring the issues 
and concerns of conservation into focus for all Americans. For 
nearly 100 years we have dealt with many challenges in the 
conservation arena. One of, I think, the proud successes is the 
work we have done in addressing the concerns that arose out of 
the dirty 1930s, with soil and water conservation and the 
excesses of erosion. But from my experiences, Mr. Chairman, we 
spend a tremendous amount of time debating the issues 
associated with public land management, and in your role on the 
Interior subcommittee, you and I have had a chance to discuss 
those issues as well by virtue of oversight to the Forest 
Service's management responsibilities.


                   land stewardship on private lands


    I would suggest to you and the other members of the 
committee that in the second century of American conservation 
we are going to change our focus. We have to if we are really 
going to get at the issues that are affecting the Nation's 
environmental quality. We will have to refocus on opportunities 
that come with better land stewardship on private lands. Since 
private lands represent two-thirds of the American landscape, 
they are really going to tell the story of whether or not we 
are successful in making further progress in the arenas of 
clean air, and clean water and wildlife habitat improvement. 
That is where we need to focus our attention. I think the 
country is poised and prepared to do so. I think American land 
owners, farmers, and ranchers and forestland owners are 
prepared and anxious to take up that challenge.


                        conservation challenges


    What I want to do is highlight three things, some of what 
we found in the work we have done over the past year in talking 
to constituencies and experts in the arena of conservation as 
to what they think the ills are that we need to address and the 
means we have to do so. Some of that comes from the work we 
recently did in analyzing the findings of the 1997 Natural 
Resources Inventory, which I will highlight just briefly. 
Secondly, I want to talk about how that led to our decision to 
put before you what we think is a bold initiative, a $1.3 
billion conservation initiative which is part of our 2001 
proposal which would make critical investments in the tools and 
the technology, and there I think what I mean is the people 
that make conservation work across the American landscape in 
partnership with private landowners.
    Finally, I want to touch base on another issue, and that is 
that EPA's efforts to formulate new rules for TMDLs, total 
maximum daily loads, which has been quite controversial in the 
agricultural community. I want to make clear where USDA stands 
on that issue, and then I will close.
    With regard to our conservation challenges this past fall, 
we held five regional forums on conservation I discussed with 
you yesterday, Mr. Chairman. They were interesting forums. We 
met with landowners, with interest groups, with the public, 
with individuals with expertise in conservation and 
environmental issues from across the spectrum of interests 
throughout the United States. We learned many interesting 
things, but I think most exciting was to learn that there are 
many success stories across the country of working partnerships 
at the ground level to try and make conservation work based on 
what we have learned over a half century of investing in 
private land stewardship.
    We pulled our information together, and Secretary Glickman 
convened a national summit on conservation in Ames, Iowa, on 
December 7th this past year. At that time we released new 
information from our Natural Resources Inventory and updated 
the information that we periodically accumulate. We found some 
rather surprising, startling things. I shared a packet of this 
information with you yesterday, left one for you, Miss Kaptur, 
with Roger, and also left with you a video that I hope you will 
have a chance to view. Mr. Bonilla and Mr. Farr, make sure you 
get this information as well. In 7 minutes I think the video 
describes the challenges we face in clear and unequivocal 
terms.


                  loss of agricultural and forestland


    Let me point out some key findings. The conversion of land, 
agricultural and forestland, to development is accelerating at 
a rapid rate. In fact, in the period from 1992 to 1997, the 
average annual rate of conversion was more than double of that 
the previous 10 years. So we are losing valuable land, valuable 
for producing the goods and services that America expects of 
their lands, and also land that is valuable in preserving what 
is the quality of life of rural and more and more suburban 
America.


                          soil erosion status


    Another interesting and startling finding was the fact that 
despite tremendous progress in tackling the issues of soil 
erosion, going back to 1982, since 1995, during the period of 
1995 to 1997, the progress we have made in tackling soil 
erosion has stalled. In 1995, we calculated 1.9 billion tons of 
soil was being eroded into the Nation's waterways a year. That 
is the same figure that we calculated in 1997. So our progress 
has stalled. We are trying to determine why that is.
    By our own assessment, at least preliminarily, we see two 
things that come into play. One is by design, strategically. We 
decided--and I was a part of this as the staff on the House 
Agriculture Committee, some of you were involved in this--to 
target our resources on what we consider the most critical 
conservation, highly erodible lands. There we have made 
tremendous progress. Tools like the Conservation Reserve 
Program have made a big difference in curbing soil erosion. But 
as we did that and failed to make needed additional investments 
in conservation because of budget constraints, other 
priorities, other needs, we have been forced to pull back in 
the conservation work that we have done in other parts of the 
Nation. So those non-highly erodible acres are now eroding at a 
higher rate, or we believe they are. As a result the progress 
that we are making in tackling the erosion is being offset by 
increased erosion in other places. So we are literally losing 
ground in our battle over erosion, a significant concern.
    I don't know that I have--here we go. I would share this 
with you. It is difficult to see.
    I think even more disconcerting than that--we have copies 
of this material for all of you that is being handed out now--
you will see that where the erosion is occurring and is 
excessive is reflected by the red here. You will see that it is 
in regions of the country where we can least afford to lose 
progress. It is in the Chesapeake Bay region in the Eastern 
United States. It is in the Great Lakes region, Miss Kaptur, 
affecting water quality in that part of the world. It is in 
parts of Texas, which is certainly impacting land productivity, 
and combined with the excessive erosion in the Upper 
Mississippi waterway, leading to hypoxia in the Gulf of Mexico. 
And it is in eastern Oregon, Washington and northern Idaho, 
where at the same time we are undertaking a significant effort 
to try and protect salmon habitat and reduce the impacts of 
change there on the quality of waters. We can't afford to lose 
progress there. We are working against ourselves in that 
regard.


                         net losses of wetlands


    Finally, I would also comment that we discovered that while 
net losses of wetlands is showing progress, that is we are 
further reducing the annual loss of wetlands and agriculture, 
we are not yet to the commitment that President Bush made a 
decade ago now. In fact, what we are finding is if it weren't 
for programs like the WRP, we would not be as successful as we 
have been in trying to curb the loss of wetlands and 
agriculture lands. Part of the loss there, by the way, is 
because of increased development where we are losing those 
lands not because of any agricultural conversion, but, in fact, 
we are losing those lands in total.


                      national conservation forum


    We took this information, presented it to the group 
assembled at this December 7th conference, and I would 
emphasize it was a wide spectrum of interests representatives 
in the Natural Resources Defense Council, from the Cattleman's 
Association, from academia, from a wide range of interests and 
expertise. And there seem to be unanimity of opinion about how 
to deal with these issues. The answer is actually a very simple 
one. We simply need to invest in the conservation tools and 
programs we know work, the voluntary assistance programs, 
conservation programs that help land owners determine how to 
help themselves, how to work together as communities, how to 
work through the RC&Ds or through watershed councils or 
conservation districts.
    You all know this because you see this on the landscape day 
in and day out. It works. Unfortunately very few people outside 
of the agriculture community understand that. You know we are 
silently effective in our silence, or our anonymity works 
against us in terms of making clear this is a national issue 
and requires additional investment.


                      2001 conservation initiative


    We took that information and came back to Washington and 
decided we finally needed to do something about it. So we 
constructed a $1.3 billion initiative which is in the 2001 
budget. We literally constructed that in the last month of 
putting together our budget, reflecting what we learned from 
our regional conferences in this national forum. And you will 
see in that package significant investments in those places 
that we think are critical to addressing these national 
conservation needs. That is, we propose to increase funding for 
the Wetland Reserve Program, for CRP particularly; additional 
monies for incentives to enroll producers in conservation 
buffers; additional resources for the EQIP program, which is 
going to be critically important for addressing the working 
landscape, but in particular for dealing with the AFO/CAFO 
issue, which is of national significance; additional resources 
for the Wildlife Habitat Improvement Program, because there we 
have exhausted our authority; additional resources for the 
Farmland Protection Program to start to tackle the issue of 
accelerated agricultural land loss; and most importantly, 
additional resources for technical assistance, because a tool 
kit is no good unless you have, to use an analogy, the 
carpenters to put it in use. And conservation is something that 
requires that hands-on application. You can't do conservation 
on the Internet. You can't do conservation unless you have 
people on the ground working hand in glove with farmers, 
ranchers, and forestland owners.
    The program also includes a unique wrinkle, if you will, 
and that is a proposal for $600 million for conservation 
security payments. That $600 million is intended to provide 
additional incentives and support to producers who don't 
currently have the financial wherewithal to put conservation 
practices in place. So we will compensate them for that.
    In essence, we will finally start to pay producers for 
producing those nontraditional commodities that are so critical 
to the well-being of America. We are going to pay them to 
produce clean water. We are going to pay them to improve 
wildlife habitat. And we will also give them cost share 
assistance to put practices in place. I think that is a novel 
approach to doing business and reflects some of our thinking 
with the potential changes in farm policy in the context of the 
2002 farm bill, because there, at least theoretically, as 
certainly Mr. Farr knows from his work on the Agriculture 
Committee, there at least has been a philosophical decision to 
do away with farm programs. We will see if that actually comes 
to pass. But here is another way to tackle these issues.


                   clean water rules and agriculture


    Let me shift gears and talk a little bit about TMDLs, 
because that issue has gotten a lot of attention. We have been 
working with the Environmental Protection Agency through the 
Clean Water Action Plan to try and deal with a whole host of 
issues as they relate to clean water. The Environmental 
Protection Agency put out a proposed rule for changing the way 
in which they implement the total maximum daily load provisions 
of the Clean Water Act. They put out a very controversial rule, 
one that would grant them new regulatory authorities.
    We have strong exception to some of what EPA proposed, and 
a very strong letter was sent out under my signature to that 
regard. Unfortunately the letter didn't go through clearance, 
it didn't go through the Secretary's office. I didn't do my job 
as much as I should have to make sure it, in fact, had. The 
Secretary has said since he didn't sign off on the letter, it 
doesn't represent official Department views, but nevertheless 
we stand by the substantive issues in that letter.
    As a result of that shot across the bow, so to speak, we 
have set up a working group with staff at EPA, and we are 
working on a daily basis to try and address the concerns that 
we raised, address the concerns of agriculture, place emphasis 
on the use of technologies we know work, voluntary assistance 
programs to get the job done. The key to making sure we can 
follow through on those commitments is funding those programs 
and having the resources to do what we do know works best.
    So we are committed to making sure that we make progress in 
clean water. We are committed to making sure it is done in a 
way that makes sense, that is not a threat to agriculture, but 
rather viewed as an opportunity. And most importantly, Mr. 
Chairman, we are committed to making sure that agriculture 
continues to make the valuable contribution it can make to 
protecting and restoring America's wonderful landscapes.
    Mr. Chairman, I want to tell you that I personally 
appreciate the extent to which you have always been open to me 
and to the Department to listen to these issues to try and help 
us work through the difficult times and try to make the 
investments we need to make in conservation. I know you feel it 
in your heart and your soul. I know, Miss Kaptur, as well, from 
conversations we have, of your strong commitment to make sure 
that we continue to make those critical investments. I look 
forward to working with you on the Great Lakes conference, in 
fact, and having a chance to focus on that particular part of 
the country and the opportunities there.
    It has been a pleasure to work with you, Mr. Chairman. I 
look forward to doing so the rest of this year.
    Mr. Skeen. Thank you, Mr. Lyons. We certainly appreciate 
your feelings. I think you have given us a great summary.
    [The prepared statements and biographies of Mr. James R. 
Lyons and Mr. Pearlie S. Reed, and the biographies of Mr. Danny 
Sells and Ms. Dana York follow:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Mr. Skeen. I would like you, Mr. Reed, to have a chance for 
you to have your comments. If you would like to have some time, 
you are on stage.
    Mr. Reed. Thank you, Mr. Chairman.
    Members of the committee, thank you for the opportunity to 
appear here before you today. I will keep my comments brief. 
With your permission I would like to submit my written 
testimony for the record.
    Mr. Skeen. It will be done.
    Mr. Reed. But I have two points I would like to make. 
First, in the great halls of the Capitol, there is a quotation 
from Theodore Roosevelt, 1910, and it reads, ``The Nation 
behaves well if it treats the natural resources as assets which 
it must turn over to the next generation, increased and not 
impaired in value.''.
    And this is what I believe the NCRS is all about with our 
cooperating organizations throughout the country. I believe 
that as this committee goes about making decisions on the 
investment that we should make in conservation, that that is 
what this committee is all about. And I think working together 
we can be successful in turning over to this next generation 
increased natural resources assets that will be better for the 
next generation and the generation following that.
    I would be happy along with Mr. Lyons to respond to any 
questions you might have.
    Mr. Skeen. We thank you.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                         current year staffing

    Mr. Skeen. And we will begin--let's take care of the 
current fiscal year before we talk about the budget request. 
And I think Mr. Lyons gave us a good overview of this 
situation. We share the same feeling. The technicians and the 
technical people that you have had on the ground have been 
sorely missed to some degree because we have just not had the 
force that we had at one time and the technical advice that you 
had. That is a large employment problem, very difficult to find 
people, because a lot of people don't have any technical tie to 
the ground and the environment that we had at one time. Do you 
have adequate financial resources to ensure that NRCS will not 
have to use reduction in force and layoffs or furloughs in the 
fiscal year 2000?
    Mr. Reed. Yes, sir. We do. But we have done that at the 
expense of cutting back to the point where we are doing things 
like not maintaining our fleet at an acceptable level. We have 
eliminated virtually all of our temporary employment, and we 
have done these things with the anticipation that as we move 
through this fiscal year into next fiscal year, we will be in a 
much better financial position. But we cannot continue to 
operate into fiscal year 2001 at the level of cutbacks we have 
made in the basic support structure in 2000.

                    Technical Assistance For FY 2001

    Mr. Skeen. In our meeting yesterday we talked about the 
funding priorities in this bill, and I just want to let you 
know that I appreciated your candor on the subject. But we just 
want to make sure that the financial resources that we do have 
are being managed in the best way possible. Your budget request 
in conservation operations includes an increase of $86 million. 
How much of that increase would go to on-the-ground technical 
assistance, and how much of that increase would be passed 
through the NRCS?
    Mr. Reed. All of the proposed increase will ultimately end 
up in the provision of technical assistance at the field 
office.
    Mr. Skeen. The field-office level.
    Mr. Reed. The field-office level. With the exception of, I 
think, there is a proposal for a $10 million or so grant 
program to be passed on to watershed sponsors, local 
conservation districts, to hire non-Federal coordinators.

                            Staffing Change

    Mr. Skeen. Last year the President's budget proposed an 
almost 1,000-person decrease in NRCS staffing. And this year 
the budget proposal increased the funding that will be result 
in over 1,800 staff year increase. Why the change in the 
philosophy?
    Mr. Reed. The 1,800 staff year increase, of course, 
reflects what Mr. Lyons talked about earlier. The 1,000--I 
think it was 1,055, to be precise--decrease that we thought we 
were facing last year at this time was a real figure at that 
time, but because of the direction that we got in the 
appropriations, and because of some of the things I mentioned 
earlier relative to us cutting back, we were able to manage, we 
believe, through this fiscal year without making that kind of 
reduction. We are going to have approximately 350 or so staff 
year reduction this year, and we think we can manage that with 
attrition.

                 FY 2001 Technical Assistance Priority

    Mr. Skeen. Within the $86 million increase, please identify 
the top priorities.
    Mr. Reed. The top priorities for the administration, of 
course, would be the provision of conservation technical 
assistance, to beef up our AFO/CAFO-type work.
    Mr. Skeen. On-the-ground personnel.
    Mr. Reed. On-the-ground work to work with farmers and 
ranchers, to deal with the challenges associated with 
comprehensive nutrient management planning, those kinds of 
issues.
    Mr. Skeen. I think that covers it pretty well. And we are 
in agreement on that.
    Miss Kaptur.

                         CCC Funding Shortfall

    Miss Kaptur. Thank you, Mr. Chairman.
    First of all I wanted to thank Mr. Lyons and Mr. Reed and 
all those others who have come from the Department for some of 
the excellent information that you are preparing that help the 
Congress and help the country get their arms around these 
questions of resource conservation. I am sitting here listening 
to you, and I am looking at these pictures of orchards, and I 
am looking at land converted to development here, and I am 
thinking, hmm, this is where I live. This makes sense to me.
    I have some questions on your budget, and following on what 
the Chairman has asked, for this fiscal year it is my 
understanding that the NRCS may not have sufficient funds 
available through the CCC to carry out your technical 
assistance programs. I am wondering if you do have sufficient 
funds to maintain current level of services this year, and if 
not, how many positions are you going to have to reduce by the 
end of this fiscal year if you do not have sufficient funds?
    Mr. Reed. Okay. Where we have a big shortfall is in our 
ability to service what we believe now will be the program 
level for the Conservation Reserve Program, and that is about 
$35 million shortfall. And we believe that on or about the 30th 
or so of July, we will have exhausted the resources that have 
been made available to service that program. We have pretty 
much eliminated our temporary employment. We have cut back on 
just about every so-called nonfixed item of expense to try and 
ensure that we can maintain our permanent full-time work force. 
And we will be able to do that, but we won't be able, based on 
what we think is going to happen with the Conservation Reserve 
Program, to service that program in August and September.

                 Supplemental for Technical Assistance

    Miss Kaptur. Mr. Reed, I don't know this, but has the 
administration included that additional need in its 
supplemental request to the Congress?
    Mr. Reed. I will have to ask Mr. Lyons or Mr. Dewhurst to 
respond to that.
    Mr. Lyons. I think that is one for you, Steve.
    Mr. Dewhurst. Well the answer is not yet. We are working 
with OMB. We are looking at the fiscal 2000 issue. The 
administration's proposal for 2001 would raise this legislative 
cap so that there is sufficient money beginning in 2001 to make 
the servicing available. But the issue this year we are still 
looking at with our folks at OMB.

                             Section 11 Cap

    Miss Kaptur. What is the reason for the shortfall? 
Underfunding last year, or just something that was 
unanticipated?
    Mr. Reed. A combination of both. The reason for the 
shortfall is basically the section 11 cap, the CCC section 11 
cap, which provides for only x amount of dollars to be spent, 
and there is not enough money within that cap to provide for 
the reimbursement for the technical services of NRCS to service 
CCC programs.
    Miss Kaptur. Does that have any relationship to the fact 
that we quadrupled shipments through the CCC last year 
internationally, and some of those funds were drawn for other 
purposes?
    Mr. Reed. I don't believe so, but, again, I would have to 
defer to Mr. Dewhurst.

              Technical Assistance for Farm Bill Programs

    Mr. Dewhurst. Not directly. When the Congress enacted the 
farm bill in 1996, the Congress also authorized a series of 
conservation programs. The Congress also in the farm bill 
limited the amount of money the Commodity Credit Corporation 
can pay to other Federal agencies for services to the 1995 
level.
    The conservation programs that were created in the 1996 
farm bill were not in existence in 1995, so there has never 
been sufficient money within this legislative cap to provide 
sufficient funds to the NRCS to service the programs. We have 
sort of struggled along the last 3 or 4 years. We found a few 
dollars here and there that were legally available, but, 
frankly, we have sort of exhausted all those resources now. So 
we don't have a lot of places to go unless the law is changed 
and this cap is eliminated or increased.
    Miss Kaptur. Yes, Mr. Lyons.
    Mr. Lyons. Miss Kaptur, I would just say that the section 
11 cap has been a source of debate for quite some time, 
particularly as demand has grown for conservation programs, as 
Steve has alluded to. I would implore you and all the members 
of the subcommittee, who I think understand this issue very 
well, to talk to your colleagues on the authorizing committee 
about this particular issue, because I think the assumptions 
that were made in establishing the section 11 cap don't fit 
today.
    The belief was we should limit the number of bureaucrats we 
hire while we expand programs. It misses the mark in 
understanding that you need conservationists, you need the 
people who could provide the technical assistance to provide 
the additional services that come as those programs and demands 
have grown. And I think we need to correct that misperception. 
This isn't simply about more FTEs, it is about service to your 
constituents, it is about service to the people we serve 
directly. That section 11 cap has become a tremendous problem 
for us to make sure we have the resources we need, not simply 
to grow the size of the agency. That is not the intent, but to 
make sure that we can actually provide adequate and appropriate 
service to the people who need it.

               Source of Technical Assistance in FY 2001

    Miss Kaptur. I know that I am out of time here. I don't 
expect the authorizing committee is going to move anything this 
year, but I know they are doing hearings. But in talking to 
some of the Members, they don't expect that there is going to 
be any authorizing legislation passed relative to farm 
legislation. So where does that leave us?
    Mr. Lyons. Well, not that I am a proponent of legislating 
on appropriations bills, but there is a place to fix it.
    Miss Kaptur. I will have several additional questions in 
succeeding rounds. Thank you very much.
    Mr. Skeen. Mrs. Emerson.

            Voluntary and Regulatory Rules for Conservation

    Mrs. Emerson. Thank you, Mr. Chairman. I want to welcome 
you all here and state for record that I really appreciate the 
great people that you all have working on the State and on the 
local level, particularly Roger Hanson, who is our State 
conservationist, and Ron Darden, who is one of our district 
conservationists. They and the field staff do a tremendous job, 
and I can't compliment them enough for their hard work.
    Before I get into some specific questions, let me just say 
that I am a little bit confused, because on the one hand, Mr. 
Lyons, you talk about voluntary and incentive-based programs 
that promote best land management practices, a partnership 
effort, and then on the other hand suddenly we have TMDL regs, 
we have animal feeding operation strategies, we have roadless 
initiatives, we have got Forest Service management plans, and 
there is a lot of heavy-handed regulation here. These 
regulations are not voluntary. Consequently I guess I am 
somewhat confused by your statement that the administration 
committed to voluntary programs, because I get the feeling at 
times that there is a misunderstanding on the part of the 
administration that, quite frankly, our farmers know that if 
they don't take care of the land, the land is not going to take 
care of them. And I think that I am a little bit put off by the 
heavy-handedness. I just state that for the record.

             Regulation of Total Maximum Daily Loads by EPA

    And let me go ahead and ask you, do you really feel like 
your involvement with the TMDL regs represents a partnership 
effort? I mean, these regulations are not voluntary.
    Mr. Lyons. I don't know if you heard my comments earlier 
about a letter that was sent.
    Mrs. Emerson. I did indeed.
    Mr. Lyons. I would submit to you that we are not going to 
get anything done unless we work in partnership with farmers 
and ranchers and that USDA representing the interests of 
agriculture and forestry works with EPA to make sure that 
whatever rules they promulgate make sense, that they achieve 
the goal we all share, which is improving water quality and 
maintaining the productive capacity of the land and the 
capability of producers to farm, to stay in business.
    We are working with EPA to try and address those concerns, 
and I respectfully request that you hold fire until you see 
what comes of that dialogue and what comes out of the rules. 
The rules are not done yet.

          Administration's Position on Voluntary Conservation

    With regard to your comment, though, I know you didn't ask 
me to respond, but I couldn't help but respond to your comment 
about heavy-handedness. You know, I would suggest to you that 
public land issues are certainly different than the private 
land issues, but in none of those instances are we in the 
administration proposing, at least not from the USDA 
standpoint, any new or significant regulations. AFO/CAFO is a 
good example. It is largely a voluntary strategy. Ninety 
percent of all AFOs and CAFOs would not be affected in any 
regulatory way. The discretion exists to deal with those 
remaining 5 percent which EPA would administer. That is not a 
role that USDA would play. Demands that will be placed on NRCS 
and agriculture will come providing additional technical 
assistance and support. We pushed hard to make sure that that 
was the way to do business because we don't think a regulatory 
strategy will work in addressing these issues. We have proof to 
the contrary in terms of what we have succeeded with, as you 
commented in your opening remarks.
    So I don't think there is any inconsistency here. The right 
tool for the right issue. When it comes to conservation issues, 
when it comes to dealing with clean water and private lands, et 
cetera, we need to stick with these voluntary approaches. We 
need to invest in them. We need to help land owners help 
themselves.

                     Regulation and Property Rights

    Mrs. Emerson. I certainly don't think the TMDL is anything 
that is voluntary and does, in fact, deal with private 
property. Speaking of which, have you all done--and I 
understand you were asked this by Senator Lugar last week a 
cost benefit analysis on the TMDL regs. If not, are there plans 
in place for doing that before final regs are issued?
    Mr. Lyons. We are in the process of assessing the workload 
that it would create for USDA doing a cost analysis there.

                    USDA Support for Property Owners

    Mrs. Emerson. How about for the property owners and farmers 
and ranchers?
    Mr. Lyons. The EPA has an obligation in promulgating their 
own rule to assess what the costs are going to be. They have to 
do that in clearance and under SBREFA, as you understand. So we 
are in the process of assessing what we think the costs of 
implementation will be. That is a part of the ongoing dialogue. 
And we have some questions about the adequacy of the analysis 
they did, and we are pushing back hard to try and make sure we 
get the right information.
    Mrs. Emerson. I would appreciate your pushing even harder 
because it remains to be seen that any of their analyses are 
balanced.
    So you can't tell me right now what role you see USDA 
playing in the implementation process of the TMDL regs, or can 
you?
    Mr. Lyons. Well, I can tell you that we don't have a role 
in implementing the regs. The EPA regs, that is EPA 
responsibility. We certainly have a role in dealing with non-
point source pollution and water quality issues. We will 
continue to play that role aggressively spending upon the 
resources that this committee gives us.
    Mrs. Emerson. But you won't actually be working in EPA in 
making sure that----
    Mr. Lyons. Not at all. Not in any way, shape or form.
    Mrs. Emerson. I have other questions. I will wait for the 
next round.
    Mr. Skeen. Mr. Farr.

                              Urban Sprawl

    Mr. Farr. Thank you, Mr. Chairman.
    You know, I fly across in country every week from here to 
California, and I am convinced just flying across the United 
States that the American landscape is more in the hands of USDA 
than it is in Interior, and that these programs we are talking 
about are really the key essence of the landscape. As you said, 
it is the mostly in private ownership.
    First of all, I would like to thank you Mr. Sells and Mr. 
Reed for releasing the money and meeting with my constituents 
on this on the Salinas Valley water project. I appreciate your 
leadership on that.

                   Agricultural Issues in California

    Secondly, I would like to tell you that I think that the 
attitude that we have in California is a little bit different 
than Missouri. Land owners in California have 33 million 
people. Urban sprawl is the number one political issue in the 
State. Farmers are getting much more progressive. They are 
realizing it is all about land use.
    I think the frustration I have in looking at all these 
Federal programs is that it is not interrelated with local land 
use. I think you give away too much. I mean, most land owners 
in our area would be willing to give up the land that is 
necessary for habitat management and streambed riparian 
protection without being paid for it as long as the rest of the 
land they could manage without a lot of regulation.

                        Water Quality Protection

    So the couple of things that are going on, we have the Farm 
Bureau and all of the ag interests signed into a program in 
Monterey Bay, which is a huge three-county region, the 
watershed goes into the national marine sanctuary which is one 
Federal policy. So what we are looking at is a water quality 
protection program for the whole watershed. I think this is the 
first time in the United States that it is going to be so 
comprehensive. It is a consortium of 25 government and private 
groups. It will be a partnership to enhance and protect the 
physical, chemical and biological conditions of the 
sanctuaries, the wetlands, into the sanctuary and the adjacent 
watersheds. The project will cover 5,000 square miles of marine 
water and 11 major watersheds covering 7,000 square miles; 
includes the regional monitoring, data sharing, urban and 
agricultural runoff, the marinas, the boating, the wetland, the 
riparian issues, point source pollution. And the focus of the 
program is to effectively integrate the large number of 
existing programs, State, Federal and local, and projects 
related to these issues, and to eliminate the gaps, redundancy, 
and pool resources to address the problem.
    This will all be done by cooperative agreement, which has 
been signed. What I am asking NRCS to do is to help with some 
technical and financial assistance. And I really want you to 
look into this program and help us with this financial 
assistance. Your people on the ground are very keen on it. And 
we can talk more about that.

                               Easements

    I am trying to figure out all these CSP and conservation 
reserve programs--you indicated that under the Conservation 
Security Program we give annual payments to farmers. And if we 
didn't do it, they would just abandon these conservation 
measures because they don't have the necessary financial 
resources. And the purpose of giving it to them is to reduce 
erosion, to improve wildlife habitat and sustainable soil.
    Why don't we get back more? I mean, why don't we just have 
permanent covenants on that land? You are paying them for it. 
Why don't we buy an easement--rather than just make these 
annual payments? Relating to Mrs. Kaptur's comment, how much of 
this million acres per year that has been converted have we put 
Federal dollars there to try to keep that land in its proper 
natural state, and then the land owner gives up and says, well, 
I am not doing this anymore, we are going to sell it for 
housing.
    We have already put a lot of dough in there to try to do 
the opposite. If, indeed, we are going to have preservation of 
ag land, and it is really complicated in California. You know 
what it is worth, $35,000 an acre. You got to make a living. If 
you buy ag land, you got to still make--payments on it, you got 
to make a killing. We grow things like strawberries and high 
value-added products. But we are in a new era where land owners 
who are serious about being in agriculture realize that they 
are going to have to manage their land properly. They are 
willing to put their own money into it to do it and to stay 
permanently in agriculture.

                      Federal Return for Payments

    I can't understand why we don't as a Federal Government get 
more permanency from the money that we put in and the aid that 
we give them so that when they do, if they do sell it, all the 
stuff that we have tried to do is for naught.
    Mr. Lyons. I will attempt to address that, Mr. Farr. I 
think in part your question reflects the extent to which 
California is different from the rest of the world in that I 
think there is or has been stronger interest in California in 
designing programs that would provide more permanency. But 
those aren't going to fly in Missouri or other parts of the 
world that the folks on the other side of the dais, I think, 
represent.
    When we worked with the Congress in 1996 in putting 
together the farm bill programs, we tried to design programs, 
you know, as the authorizing committee that ultimately put this 
together, that would fit in the different circumstances across 
the landscape. So we do have provisions and programs that 
provide for permanent easements. But, for example, in the WRP 
program, the Wetland Reserve Program, we have provisions that 
wetland owners choose whether they want short-term or permanent 
easements. We have tools that provide for a range of 
circumstances in response to the needs of different land 
owners.
    Mr. Farr. In that short term what happens if they give up 
and they abandon it? What have we gotten out of it?
    Mr. Lyons. Well, we have gotten some conservation over the 
periods of time. Hopefully, through their experience, land 
owners are going to stick with it. We haven't had enough 
experience under this incremental easement program to know what 
the permanency will be. But the critical thing--
    Mr. Farr. Do they have to pay back anything?

                        conservation incentives

    Mr. Lyons. They would if they were to break the terms of 
the contract during its tenure, but not after the fact, as I 
recall.
    I think an important point is, you know, in 1985, 1990, the 
original concepts for CRP, et cetera, were designed with a 
philosophy that what we got back was as producers participated 
in farm programs, they had to put conservation programs in 
place. They couldn't sod-bust, they couldn't swamp-bust. And 
they had to have conservation plans under conservation 
compliance in place. So what we, quote, got back was a 
commitment to conservation where term producers got farm 
program payments.
    Now, the question is in 2002 if farm programs does appear, 
what are we going to have? So we are redesigning the system. 
The conservation security payments you referenced are a 
proposal to come up with a different system of investing in 
conservation, providing incentives, not threatening land 
owners, but saying we are going to compensate you for those 
commodities you can't capture in the marketplace; for the work 
you do to generate clean water, we are going to pay you for 
that. It is a public good. For the work you do to improve 
wildlife habitat which you can't capture unless you lease hunt 
your farm, we are going to pay you for that.
    Mr. Farr. Don't you have to extract some permanency? Here 
is what happens is the better you take care of the land, in the 
long run the more valuable that land is going to be. So you 
have had the government essentially assist you in upgrading the 
quality of your land. Then you go and sell it for development, 
and you get a big price because the land is in better 
condition, and it is more attractive for building homes on, and 
the government gets nothing back.
    I mean, let's take out an equity interest so when the 
development goes, at least we can share in the value of the 
development. I think we need to use more business sense here.
    Mr. Lyons. Some of our programs provide for permanent 
easements. Farmland protection would. Forest legacy, which is 
actually a forest program, would. That is a philosophical 
debate that you all have to have, because ultimately you will 
write the laws that we have to implement in that context. That 
is how we came out in 1996.
    Mr. Skeen. Mr. Bonilla.

                USDA's Position on EPA Clean water Rule

    Mr. Bonilla. Thank you, Mr. Chairman.
    Mr. Lyons, I will be very frank this morning because I 
think I speak for a lot of farmers and ranchers out there. We 
were so proud of the USDA's initial letter on the TMDL 
situation that came out of the EPA initially, that some of us 
in a bipartisan way, and including the Ranking Members on the 
authorizing committee as well, and the Chairman and key members 
of this subcommittee, again bipartisan, said, in essence, thank 
you.
    I want to submit that letter for the record, if I could, 
Chairman.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Mr. Bonilla. We wrote to Ms. Browner saying thank you to 
USDA for standing up for the farmers and ranchers of this 
country and, quite frankly, standing up to some of the radical, 
extreme efforts by the EPA on TMDL. And we were disappointed 
that in the end you guys wimped out on the farmers and 
ranchers.
    You are the U.S. Department of Agriculture. You don't have 
to carry the water for the EPA. You need to stand up for this 
Nation's agricultural industry. That is, after all, what this 
agency was set up for in the beginning, to look after those 
interests, and not some other agenda that might be out there 
that, quite frankly, is in contrast and adverse to what a lot 
of our farmers and ranchers are trying to accomplish out there.
    At a recent hearing on TMDL before the Transportation 
Committee, you stated you were trying to work out concerns you 
have over the proposed regulations. I would just appreciate 
it--you don't have to get into it now if you don't want because 
this subject has been brought up a couple of times already--if 
you provide the committee with a list of those concerns and how 
USDA would like to see them resolved and the progress made on 
each one, because if the USDA does not take a strong stand in 
this area, the EPA is going to roll anything, any concerns that 
you might have.
    [The information follows:]

                        Total Maximum Daily Load

    The main concerns of USDA are as follows. First, we want 
the EPA rules to show support for and recognition of the key 
role USDA conservation programs play in achieving water quality 
improvements. The USDA has forged many significant partnerships 
implementing Best Management Practices (BMPs). Farmers put in 
streamside buffers and idle environmentally sensitive lands to 
improve water quality. The Wetlands Reserve Program, the 
Environmental Quality Incentive Program (EQIP) and one of its 
predecessors the Water Quality Incentive Program have benefited 
thousands of farmers and ranchers and helped them to improve 
the productivity of their operations through improved 
conservation. The Conservation Reserve Enhancement Program 
(CREP) is playing an important role in protecting the waters of 
the Chesapeake Bay, salmon habitat in Oregon and Washington, 
and drinking water supplies for New York City. We want these 
voluntary partnerships to be given due credit. These on-the-
ground actions need to be includes in what EPA considers 
``reasonable assurance'' a Total Maximum Daily Load (TMDL) will 
be implemented. Second, we are discussing with EPA when and if 
silvicultural activities should be subject to National 
Pollutant Discharge Elimination System (NPDES) storm water 
permits. Implementation of BMPs can often alleviate water 
quality problems and EPA should utilize BMPs to the greatest 
extent possible. Third, we want the best-available science to 
be used by the EPA, States, and Tribes in setting and 
implementing TMDLs. Theoretical models sometimes have high 
levels of uncertainty and there are often gaps in the data 
regarding what is natural background pollution versus what is 
caused by human actions. When data or analytical techniques are 
lacking, that uncertainty needs to be recognized by the TMDL. 
Fourth, we want to work with EPA in developing comprehensive 
cost projections of the proposed TMDL rule. Finally, we want to 
establish good communication between USDA and the EPA, as well 
as our state and local partners. USDA has formed an interagency 
group with EPA to work through our concerns. That group has 
been meeting regulatory and while progress is being made, this 
is a technical area involving a great deal of complexity. The 
work of the interagency group is ongoing so it is difficult to 
provide specific conclusions at this time about the progress we 
have achieved.

        Representing Agriculture's Position on Clean Water Rules

    Mr. Bonilla. So I hope that the concerns of farmers and 
ranchers, agriculture, are addressed in this area. So if you 
would like to comment briefly, fine; otherwise I would ask in 
essence to submit this for the record.
    Mr. Lyons. I appreciate the opportunity to comment, Mr. 
Bonilla. I would assure you that we are not wimping out, to use 
your term.
    Mr. Bonilla. You can see how a lot of people perceive that.
    Mr. Lyons. I understand that. But what I have to worry 
about in the end is where we end up.
    Mr. Bonilla. For agriculture.
    Mr. Lyons. Where we end up for agriculture, and the Nation 
as a whole.
    Mr. Bonilla. No, agriculture, U.S. Department of 
Agriculture.
    Mr. Lyons. I understand that, Mr. Bonilla. I understand 
that perfectly well. I know what I need to do in my job to make 
sure that Agriculture's interests are represented, and we do a 
good job of ensuring we address clean water in a way that 
represents, reflects and is responsive to Agriculture's needs. 
I understand that perfectly well. But the way that letter was 
drafted unfortunately addressed legal issues that I don't have 
the authority nor the expertise to address, but a lot of legal 
opinions with whether or not EPA has the legal authority to do 
what they are doing. I will not engage----
    Mr. Bonilla. It was your letter.
    Mr. Lyons. Yeah, it was my letter. It had my signature 
block on it. I made that point before, Mr. Bonilla. I don't 
back down from that in any way, shape or form.
    Mr. Bonilla. It sounds like you are.
    Mr. Lyons. I am not. I am trying to make this clear, and if 
you let me finish, I will.
    In addition, I don't think the way you fix a problem is 
getting in the face of the person that you have to work with to 
resolve this. And so we have taken a little different tack on 
this. We made our point, and now we are trying to work this 
out. The letter is great legal fodder for the litigation that 
may follow whatever rulemaking ends up with, but that was not 
my goal. My goal was to make clear we have some serious 
problems with the rule, how it has been drafted. We have worked 
as partners before. We need to get back to the table and work 
as partners again. That was my intent. I can assure you that is 
my goal.
    We would be glad to give you a list of the issues that we 
are attempting to address here as well as describe for you the 
nature of the dialogue and what we hope that accomplishes.

               Urban Resources Partnership Program Audit

    Mr. Bonilla. I appreciate that.
    I would like to move to a different area. Last year Mr. 
Reed testified that the NRCS was being spread too thin. He 
outlined some concerns he has today as well that he has dealt 
with recently. Fleet maintenance is one thing you addressed. 
This question relates directly to a budgeting and prioritizing 
of funds. Once again, the budget this year is full of new 
initiatives and programs; however, at this time I would like to 
focus on a program that was started in fiscal year 1994 by Mr. 
Lyons. It was not authorized by Congress. The Urban Resources 
Partnership Program.
    Recently the OIG audit identified approximately $21 million 
in misappropriated funds, funds that could have been used for 
fleet maintenance and personnel issues and office equipment and 
things that Mr. Reed was talking about earlier. This includes 
money spent to pay for Sierra Club outings, wall murals, and 
money used to fund civil lawsuits. But even more disturbing is 
your reluctance to accept the responsibility for programs 
placed under your leadership and created by you.
    Under what authority did you expend these funds, and could 
you please provide the committee a detailed list for each of 
the fiscal years the program has been run by your Department, 
the exact money spent for each fiscal year, and from what 
accounts the money was taken?
    Mr. Lyons. Be glad to provide that to you Mr. Bonilla.
    [The information follows:]

               Urban Resources Partnership Authorization

    The authorizing legislation used by Natural Resources 
Conservation Services to support the Urban Resources 
Partnership is the Soil Conservation and Domestic Allotment 
Act, Public Law 74-46, 49 Stat. 163, 16 U.S.C. 590a-f.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                      USDA's Response to URP Audit

    Mr. Lyons. If I could have 2 minutes to respond, I 
appreciate it.
    Mr. Bonilla. I am out of time, but I am sure the Chairman 
will permit.
    Mr. Skeen. Go ahead.
    Mr. Lyons. Let me state at the outset that I have strong 
exception to Mr. Viadero's study and review. What Mr. Viadero 
didn't have the benefit of, or at least didn't communicate to 
the committee, I don't believe, was a response memo that I 
prepared to his study. I would like to submit copies of that 
for the record, Mr. Chairman, if I could.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                        Authority to Conduct URP

    Mr. Lyons. This memo, I think, highlights some important 
problems with Mr. Viadero's analysis. Basically his analysis is 
focused on a presumption that NRCS does not have the authority 
to do what we sought to do, but as is pointed out in a 
subsequent OGC review that I requested, a review of their 
initial position, OGC pointed out a very important oversight in 
their initial analysis which was the basis for Roger's 
commentary. The OGC stated, quote, our prior opinion on this 
subject did not take into consideration the conservation 
operations appropriations language and its relevance for 
understanding the breadth of the 1935 act. And it goes on to 
explain that the Secretary's authority is quite broad.
    In addition, I would point out that we have had extensive 
conversations regarding this program with the committee in the 
past, and the Chairman and I did have a chance to visit on this 
yesterday. I appreciated that.
    Mr. Bonilla. Your response, by the way, I am told, and I 
have a copy here, was included in the OIG's report.
    Mr. Lyons. No, it was it was not included in the initial 
report, I can tell you that. In addition----
    Mr. Bonilla. I have a copy here.
    Mr. Lyons. What is the date of my memorandum? I don't have 
any follow-up report to Mr. Viadero. Well, then, I encourage 
you to read that, because I think it provides important 
information that perhaps Roger has not looked at closely.
    In addition, I would point out in dialogue with the 
committee we discussed this issue, provided additional 
information for the committee with regard to funding for this 
program. And I would also like to submit for the record a 
letter that Chairman Skeen had sent to Mr. Glickman regarding 
this issue in which he pointed out at least in 1998 that he 
didn't have any objection to the allocation of funds related to 
this program. So we have been open about the dialogue.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    [Clerk's note.--The subsequent House report 105-588 
accompanying the fiscal year 1999 appropriations act continued 
language that funds were not available for the American 
Heritage Rivers Initiative, the Urban Resources Partnership and 
the Northwest Salmon Recovery Initiative until justification 
and reprogramming requests were approved.]
    Mr. Bonilla. Are you pleased with the way the money was 
distributed to the groups that I mentioned briefly?
    Mr. Lyons. Let me suggest two things, if I could, 
Congressman. I think the one thing I would point out is that 
you know we designed this program to try and address the large 
portion of the American population that doesn't understand 
conservation, doesn't understand agriculture, has no idea where 
their food comes from, and needs to learn a little bit more 
about their connections to the land. We are serving 
disadvantaged communities, we are serving African communities, 
Latino communities, Asian Pacific communities in ways in which 
they have never gotten assistance.
    We designed the program, though, so there would be no 
overhead. This is one of those programs where all the money 
went to the ground. We designed the program so that the 
guidance would come from local steering committees of agency 
officials. It was multiagency. We took the NRCS money and we 
multiplied the benefit in working with Forest Service, with the 
Fish and Wildlife Service, the Park Service, with HUD and other 
entities.
    Mr. Bonilla. Thank you for extending my time.
    I just have a final comment. I think some of these 
expenditures are way over the line, but we can get into this at 
another time. Thank you, Mr. Lyons.
    Mr. Lyons. I would be glad to visit with you at any time 
about that, Mr. Bonilla.

              additional local level technical assistance

    Mr. Skeen. Mr. Boyd.
    Mr. Boyd. Thank you, Mr. Chairman. Secretary Lyons, Mr. 
Reed and others, thank you for coming. I know you have a tough 
job and certainly want you, Secretary Lyons, to take a deep 
breath.
    Mr. Lyons. It is getting me excited now.
    Mr. Boyd. I don't know really where to start, Secretary 
Lyons. I know you probably have heard me say this before, Mr. 
Reed, when I was growing up as a young man, the Soil 
Conservation Service was a technical assistance agency which 
helped the farmers through some really severe erosion problems 
in this country. And Congress put in place this mechanism by 
which we could continue to conserve our soil, and Soil 
Conservation Service is an integral part of that.
    I remember growing up as a young man that we had a local 
director, that stayed there for 30 years and we considered him 
as a part of our family. We loved him, and he helped us do all 
kinds of things to conserve our soil and make sure that erosion 
was minimized.
    I think the general consensus among my constituents now who 
are in the farming business, is that NRCS, has transformed 
itself over the last few years from a technical assistance 
agency to a compliance enforcement agency. And I know you have 
probably heard me say that before. I have had this discussion 
with Mr. Glasgow at the State office. The State people have a 
tough job. I am proud of those folks. I work with them 
regularly. Your county folks, they really do have a tough job, 
also. My questions are going to be along those lines because I 
really would like to see NRCS be a technical assistance agency 
again.
    You talk about that in your budget. You have asked for a 
considerable amount of additional money to provide technical 
assistance or beef up your technical assistance issues. And I 
simply would ask you if you did receive the $28 million in 
funding increase that you requested for field-based technical 
assistance, what improvements would my constituents see as 
customers to your local district conservation office?
    Mr. Reed. Thank you, Mr. Boyd. What you would see in your 
congressional district would be a reflection of what that--
whatever percentage of that $28 million would be as it relates 
to what has been identified in Florida as the needs on the 
ground for technical assistance to provide to land owners. An 
estimate of what that could be I could provide for you later 
for the record, but every penny of that would be targeted for 
the local field office operations.
    [The information follows:]

                      Florida Staff Year Increase

    If the Natural Resources Conservation Service received an 
additional $28 million in technical assistance, I would ensure 
the entire amount would be allocated to our field offices, with 
nothing going to our National Headquarters offices. It is 
difficult to determine Florida's exact share of the $28 million 
without knowing which resource concerns the additonal funding 
will address. However, by comparing the workload analysis 
staffing need for Florida and the total national staffing need, 
we can determine Florida would get six to eight new field 
employees.

              improving the focus of technical assistance

    Mr. Boyd. Well, I just want to say that I think the problem 
is just a little bit larger than throwing a few bucks at it. I 
think what happened is the focus of Agriculture has changed on 
the technical assistance side. It is not the fault of the 
people on the ground, because I don't think some of them are 
properly trained in technical assistance or have the 
background.
    We have had this discussion before that you are having 
trouble hiring people at that level with the expertise to know 
how to solve some of these problems. I think the focus of the 
agency has shifted to compliance and some other conservation 
issues on a nationwide basis. But I wanted to make that point, 
and I appreciate your answer.

              forest service access and road construction

    Mr. Secretary, I want to go to another issue. Congress 
clearly states its policy with regard to access and road 
construction in United States Code 16, section 532, and I 
quote, ``The Congress hereby finds and declares that the 
construction and maintenance of an adequate system of roads and 
trails within and near the National Forest and other lands 
administered by the Forest Service is essential if increasing 
demands for timber, recreation and other uses of such lands are 
to be met, and that such a system is essential to enable the 
Secretary to provide for intensive use, protection, development 
and management of these lands under the principles of multiple 
use and sustained yields of products and services.''.
    I don't know how much clearer the congressional policy for 
this issue, road maintenance in our National Forest, could be. 
How is it that the Forest Service can justify its dismissal of 
such plainly stated congressional will?
    Mr. Lyons. We haven't, sir. I don't think we are in 
disagreement with you at all. Could you point to where we have?
    Mr. Boyd. Well, only that I go to your budget summary, 
budget request, and you are asking for $13 million additional 
money for road maintenance, but on the other, the road 
construction side, you have bypassed any additional funding 
request, and that temporary suspension is in effect. And I 
quote from this: ``Temporary suspension is in effect until the 
development of a revised transportation policy and new 
analytical tools or 18 months, whichever is sooner. A proposed 
transportation policy rule is expected in 2000.''
    Mr. Lyons. So you are talking about the temporary road 
construction to roadless areas, Mr. Boyd. Just to clarify, let 
me explain why we did so, and, of course, this relates to why 
we are studying the roadless area issue. I don't want to take 
the agriculture subcommittee's time to too large a degree, but 
let me explain.
    As I think you are aware, we have over 300,000 miles of 
roads in the National Forest System. We have 55 percent of all 
roads on all public lands. That includes Park Service, Fish and 
Wildlife Service, Bureau of Land Management, et cetera. We have 
such a huge system, we can't maintain it. We have an $8.4 
billion backlog in road maintenance on the National Forest. 
Every year we only get 20 percent of the opportunities we need 
to maintain a small percentage of the system, the system, the 
major part of the system that is used. We can't keep up, so the 
backlog grows every year.
    I think you would agree that the best way to get out of a 
hole is to, first of all, stop digging. And so we elected to 
place a moratorium on building new roads until we could get a 
handle on how to maintain the critical system that exists, just 
as the law directed us to maintain the system which is 
essential as a part of the infrastructure of rural America. 
That is what we are attempting to do.
    Just this morning Secretary Glickman is announcing a 
proposed policy for how we are going to manage and maintain 
that existing road system. As you are well aware, this past 
fall the President directed us to look at issues associated 
with the management and use of roadless areas as well.
    We are trying to get a handle on this huge problem. I agree 
with you completely. I want to be clear, we did get additional 
road maintenance funds, which I dearly wanted. I wanted 
additional money for construction and reconstruction not 
necessarily in roadless areas, but to maintain that system 
again and to fix problems that exist with the system as it is 
currently laid out. OMB simply did not provide us the funds. 
That is evidence to the fact in, my mind, that we have to fix 
this roadless issue.
    As you recall, just 3 or 4 years ago, the Forest Service 
almost lost its entire road budget on the floor of the House. 
We missed by one vote. I don't know how the members on this 
committee voted on this issue. I think you are on different 
sides of this issue. Mr. Hinchey is very familiar with this 
from their experiences on the Interior appropriations 
committee. That was a clear signal to me that we had to get on 
this issue, battle over road construction funding for the--to 
the roadless areas. That is why we are asking the American 
public to tell us how they want us to use their roadless area 
in the future. At the same time we are trying to get the 
resources to manage the existing infrastructure.
    Mr. Boyd. Thank you, Mr. Chairman. I see my time is up. I 
know we will have another round.
    Mr. Skeen. Mr. Latham.

          usda's position on epa proposed water quality rules

    Mr. Latham. Thank you, Mr. Chairman, and welcome. I guess 
I--on the proposed rules from EPA, I really want to make it 
very clear I have to go back and talk to people at home and let 
them know what your position is, for sure, and the real concern 
there is waffling on the your opposition. Could you state 
clearly, you know, what is your position? Do you oppose the 
proposed regulations? And also I would like your opinion 
whether or not you believe, and the position of the Department, 
is that the proposal is not legitimate or does not--it 
conflicts with current law.
    Mr. Lyons. Let me try and address that, Mr. Latham. I think 
the best way to do this is I will send you copies of my 
testimony and Secretary Glickman's testimony recently before 
the relevant committees and subcommittees. As Secretary 
Glickman stated, the letter does not represent official USDA 
policy. At the same time, we have grave concerns with a number 
of elements, provisions of the proposals put forward by EPA. We 
were never sitting down face to face with them, representing 
Agriculture's interests, representing a common concern for 
addressing the water quality concerns of a Nation to the extent 
that pollution remains a concern and seeking to fix those 
issues.
    On the matter of legal authority, we will not express a 
position on legal authority, because EPA has responsibility for 
implementing their legal authorities. We don't ask them to 
comment on ours, and it is not appropriate for us to comment on 
theirs.

                         proposed crp expansion

    Mr. Latham. In your budget proposal, you want to go to 40 
million acres in the CRP program. First of all, how many acres 
are currently in CRP? Authorized 36.4 million; how many are 
actually in?
    Mr. Lyons. We will give you the exact number in one second.
    Miss Kaptur. Would the gentleman yield on that point? I 
wanted to ask from the testimony that has been submitted, it 
says 40 million acres. How much is that? Is that Massachusetts? 
Is that a corner of Ohio? How much is 40 million acres? It 
would be helpful to express it in terms of something the rest 
of the country can understand.
    Mr. Reed. Forty million acres would be about four-tenths 
the size of California.
    Miss Kaptur. Oh, all right. Well that is better then.
    Mr. Latham. It is all in Mr. Farr's district on a permanent 
basis.
    Mr. Lyons. We are at about 31.5 million acres, I believe.
    Mr. Latham. And I guess begging the question here, why do 
you want to go to 40 million if you are not using the acres you 
currently have authority for?
    Mr. Lyons. I think there are two answers for that. One is 
we have heard overwhelmingly from producers and from others who 
see value in the CRP that they want to have the option and the 
opportunity to enroll. They like that. Number two is we think 
that offers us a tremendous opportunity to deal with water 
quality concerns through continued sign-up of CRP acres in 
riparian buffers. We want to have the flexibility to address 
what----

                      potential for crp enrollment

    Mr. Latham. I could take care of half a million of those 
acres tomorrow in Iowa. But the acres are sitting there with 
the authority to use them. We have producers who would love--
land that should never have come out of CRP, but because of the 
way it was administered previously were not allowed to be put 
back in. I can show you a lot of very highly erodible land in 
my district that could not meet the standards, and it is very 
frustrating knowing that there is that many acres sitting there 
unused, 5 million acres that is authorized and you are not 
using it. And now--I mean, I want a bill to go to 45 million 
acres.
    Mr. Lyons. Okay.
    Mr. Latham. Yeah, fine, except if you are not going to use 
it, what is the use?
    Mr. Lyons. I agree with you, Congressman, that we have had 
some problems in the administration in the past. We are trying 
it. Actually NRCS doesn't have the management responsibility. 
We don't administer CRP. We work in concert with FSA. But we 
know that we can do a better job of letting land owners know of 
this option of enrollment of lands in the riparian buffer 
initiative. We are making progress in that regard. I know 
Governor Vilsack has launched an initiative to deal with water 
quality in Iowa. We think CRP could be a tool. So that is why 
we are trying to provide more flexibility.
    Mr. Latham. I guess my time is up, Mr. Chairman.
    Mr. Skeen. Mr. Hinchey.

                       excessive cropland erosion

    Mr. Hinchey. Thank you, Mr. Chairman.
    Mr. Lyons, thank you for your testimony. I am sorry I was 
late, but we have subcommittees meeting at the same time in 
this building, so it is, as you know, impossible to be two 
places at the same time. But I am glad I was here for some part 
of your presentation and to have the opportunity to ask you 
some questions.
    I am fascinated by the chart you have provided us here, the 
map entitled Excessive Erosion on Crop Land, dated 1997. Is 
that something that you have given us?
    Mr. Lyons. Yes.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                         preserving arable land

    Mr. Hinchey. It is really very impressive, and truly 
worrisome because we continue to lose millions and millions of 
acreage of arable land in the agricultural heartland of the 
country. This information shows that we have an awful lot of 
work to do if we are going to reverse that trend, or at least 
stop it at some point and preserve the arable land that we 
have. So this is something that we need to pay more attention 
to than we have in the past and even than we are paying at the 
moment.

                     conservation security program

    With regard to the budget, your request for $600 million 
for a new Conservation Security Program looks very, very good. 
I am speaking from a parochial point of view because I am quite 
secure in the statement that this kind of program is very good 
for the farmers who live in New York State and the Northeast--I 
would guess Pennsylvania and other parts of the Northeast, 
probably the Midwest, and I certainly hope it is true of New 
Mexico as well, which I suspect it is.
    Mr. Skeen. Anything is possible.
    Mr. Lyons. You could be assured New Mexico is a part of it.
    Mr. Hinchey. I believe it is a program that looks very good 
from the point of view of farmers in New York. So I am looking 
forward to seeing more programs which work directly with the 
farmers to curb erosion and protect water supplies from 
pesticide and other kinds of dangerous runoff. So I hope that 
you are very successful in that movement.

                          farmland protection

    You also proposed a program for farmland protection which I 
think is very important. You are asking for $65 million to 
reauthorize this program, which seems to me like a very small 
amount of money to do the job; nevertheless, it is something 
that must be done. So I just congratulate you on having that in 
there.

               increase conservation technical assistance

    You have asked for an $86 million increase for conservation 
technical assistance, which is also, I think, something that is 
very important to farmers and very important to the communities 
in which farmers operate.
    The trouble that I see, frankly, in the budget is not in 
the programs. I think these programs are very, very good. What 
I have found in my experience working with your staff in New 
York is that the programs are good, but you don't have the 
people to carry them out adequately. NRCS, for example, lost 22 
positions during the past few years in New York State. And we 
understand that at least 20 full-time positions are necessary 
to satisfy the current demand for technical assistance, not to 
mention any increase in demand. So the programs are good, but 
they are not going to be effective unless we have the people on 
the ground to implement them.
    I know this is all part of a plan to reinvent government, 
which is good in its concept and good also in its 
implementation up to a point. But I fear that in some areas we 
may have gone too far. And I suppose that I would pause now to 
just hear your comments on that.
    Mr. Lyons. You won't hear me disagreeing, Congressman, on 
that subject. We have tried to pare back and cut back, but I 
think we have found that we have hurt ourselves in the impact 
it has had on our delivery system. And you mentioned ceilings 
and positions in New York, those are in reference to the 
erosion chart. You will see that erosion is also excessive in 
the Delaware River Basin and in parts of your country as well 
as it affects the New York City watershed, which, as you know, 
we are doing a great deal of work to try address pollutants, to 
try and address water quality at the source. The fiscal year 
2001 request would provide for additional ceilings and 
additional personnel to try and correct that trend and get 
people on the ground who could then put those conservation 
tools to work and working with land owners.
    Mr. Hinchey. Well, I would like it if you could tell me not 
now necessarily, but how much additional funding would be 
required to fill key positions in the States across the 
country, because this kind of activity is very important from 
the point of view of the farmers.
    You mentioned the New York City watershed. The difficulties 
that we are experiencing in New York are going to be 
experienced by a lot of other places across the country as 
population density increases in those other areas. It is 
important from the point of view of agriculture to keep the 
land in place, prevent it from eroding and running off, and 
particularly carrying with it the agricultural inputs that are 
necessary in many areas to grow productive crops. At the same 
time when you prevent that runoff, you are preventing the 
deterioration of important water supplies and watersheds.
    In the case of New York you have a watershed that provides 
water for about 10 million people. With the water supply coming 
from an agricultural area, there is a real danger that the 
runoff from the agricultural area is going to pollute the water 
supply for 10 million people, probably in the future 15 million 
people. So it is a real concern.
    So I applaud you in some of the initiatives that you are 
taking, but I know from experience that these programs are not 
going to work unless we have people to operate them.
    My time has expired, but I----
    Mr. Reed. Mr. Hinchey, I would like to respond to that. In 
doing so, I think I will also respond to a question Mr. Skeen 
asked earlier as well as a comment Mr. Boyd made in trying to 
be responsive to one of the directions we received from this 
committee, and that is to develop an accountability system so 
that we can provide factual information on the workload and 
what the true needs are. We are to a point where we have some 
pretty good data on that. I think we can provide for you real 
good information about what we actually need at a minimum level 
in order to maintain this great conservation infrastructure 
that we have throughout the countryside, the Nation, in 
partnership with conservation districts and State conservation 
agencies to have people, like Mr. Boyd mentioned earlier, at 
the county level working with the farmers and ranchers across 
America.
    Mr. Hinchey. I appreciate that.
    Thank you, Mr. Chairman.
    Mr. Skeen. Miss Kaptur.

    resources and policy to address farm-suburban-urban conservation

    Miss Kaptur. Thank you, Mr. Chairman.
    I was just looking at what your FTE level is, trying to get 
the numbers straight in my mind as to what is additionally 
needed this year. We talked about the $35 million shortfall and 
how many persons that translates into for fiscal year 2000. 
Perhaps you could find that information while I ask my next 
question.
    I was very impressed, Mr. Lyons, with your comments about 
America being in the second century of conservation. And 
thinking about our ecosystem, we know that the ecosystem 
doesn't stop at the farm's edge. In fact, many times 
agriculture itself interrupts the natural ecosystem that has 
produced the bounty of the natural landscape in this country. I 
will share some experiences I have had in Ohio with 
constituents and others. And I guess my fundamental question to 
you is in the way these programs operate. Where do you have 
good examples of where USDA works at the local level in trying 
to implement conservation programs that go beyond the farm's 
edge?
    That is really the basic question, but, for example, I was 
going through an area in our community which is just 
incredible. They call it an oak-hickory-beach system--it is a 
B-E-A-C-H, not beech tree--but east coast beach system. When 
the glaciers withdrew, they left this unusual system that 
really shouldn't exist in our part of the country where we have 
oak forests and we have a lot of sand and many park systems, 
many wetlands that may not necessarily be on agricultural land. 
And one of the questions I was asked by one of the local people 
working for the Nature Conservancy is why are your regulations 
so narrow? You don't allow wetlands to be designated on private 
property if it isn't farmed. So we have this really holey 
system where maybe the farmers protect a wetland and get a 
payment, but then you have got private property next door. Then 
you have got the metro parks next door to that. Then you have 
Nature Conservancy. It is very interesting to take a look at 
that.
    And somehow our Federal programs are rather restrictive. 
They don't necessarily allow a community to have an umbrella 
organization that naturally pulls all these interests together 
and does what is best in terms of restoring the ecosystem.
    In the urban context, you, as a department, developed the 
Backyard Conservation Program, which interested me because 
though I represent many farmers, not too many ranchers, I live 
in the urban area myself. And, of course, the urban area is a 
huge impediment to the ecosystem functioning, and you have to 
restore a lot of plants and water systems that have been 
disrupted by the development of this past century. We have 
major highways come through the most productive land in Ohio, 
yet the USDA presence in the region doesn't necessarily work 
with the Federal and State highway people to find a way to use 
the hundreds of millions of dollars that are going to come in 
to deal with traffic to also begin looking at easements and how 
one purchases easements or limited access along that route in 
order to protect agricultural interests.
    And so what I find at the local level, we have all these 
high, lofty goals at the Federal level, and they are worthy 
ones, but at the local level the mechanisms for people to even 
use these programs are so very weak. And Ohio didn't apply for 
a dime of farmland protection money. I am embarrassed for my 
State. They all of a sudden discovered maybe it is something 
important. But if you were to poll in our State, just like Sam 
was talking about in the Salinas Valley area, there is no more 
important issue in rural Ohio than sprawl, because we have more 
urban areas than any other State in the country. So we are 
pressed at every single corner and place in our State, but 
something isn't happening at the local level.

                 conservation for the entire landscape

    So could you discuss a bit how perhaps you have discovered 
around the country places where some of these disparate 
interests can be pulled together in the interests of the 
ecosystem in a more holistic manner?
    Mr. Lyons. I would be glad to, Miss Kaptur. I suggest to 
you in the packet of information left for you last night--and, 
again, we will make sure it is available to all the members of 
the subcommittee--some examples of success stories in every 
State in terms of our conservation efforts.
    I want to address the rural-suburban-urban connections and 
systems. As you know, and we have discussed before, you know, 
these systems know no boundaries. Watersheds may start in a 
rural area, but they run right down to the mouth of the river, 
oftentimes through metropolitan areas.
    Miss Kaptur. May I say that in our community I have been 
exceedingly frustrated because we are the recipient from 
watersheds in Michigan and Indiana, and we are sitting in the 
bowl of that, but the USDA says to us, well, we only deal with 
watersheds in rural areas. Even though the urban area is 
completely flooded because of what is happening with the 
watershed in the rural region, there is no connection. And so 
do you know the solution in our community? Our mayor of the 
largest city is saying the answer to runoff, in Toledo, Ohio, 
we are going to tax every urban home owner on the basis of how 
much square footage is on their roof and the asphalt on their 
driveway. That is the answer to runoff in our area, which is 
not the answer. But what I am saying, there is discretion at 
the local level.

                working together on conservation issues

    Mr. Lyons. Well, we are trying to build those connections. 
I don't want to belabor the discussion on urban programs, but 
that is one place where we can make a difference. We do a lot 
of work in urban-suburban communities in trying to build 
conservation connections and show that we can work throughout 
that entire landscape. Part of that is educating communities to 
the role they can play, while addressing the issues of 
livability and sprawl; is to make where people live a pleasant 
place to live, and protecting open space, reducing erosion, 
restoring vegetation, and at the same time using tools like 
farmland protection to try and keep those open spaces outside 
the city limits as they are. So we are trying to build those 
connections.
    Our investment in urban areas is less than 1 percent of our 
total budget, yet--of course, 80 percent of all Americans live 
in those environments. I think there is a philosophical 
difference that exists in the Congress on what role we should 
play there.
    I admit to my bias. I grew up in urban New Jersey not far 
from Mr. Hinchey's district. You know, I went out in the 
Catskills and the Adirondacks into rural areas to play. That is 
why I developed my love for nature.
    I think it is unfortunate that the residents in urban 
environments can't contribute to protecting their environment, 
their waters, and have a greater appreciation for the 
connections to those rural landscapes.
    Miss Kaptur. I want to say the way in which one organizes 
to deal with this at the local level is exceedingly complex, 
and many times the Federal programs don't create the incentive 
for people to work together beyond the boundaries of the farm's 
edge. You sent us this picture which reminds me of McQueen's 
Orchards in Lucas County, probably our largest orchard. And 2 
years ago the farmer and his family who helped develop this 
incredible set of orchards said, Marcy, come with me. We walked 
across his back lands. What is coming at him is what is on 
this, and he said I am going to be overwhelmed. I want to 
remain in farming. How am I going to do that here? There is 
nobody to help him.
    So I was very interested in the language in your submittal, 
producers in conservation buffers, trying to help producers in 
some way with buffers around the edge. I kept thinking, well, 
maybe that is an initiative that might help a farmer like this. 
Thank you.
    Mr. Skeen. Mrs. Emerson.

                       concern about regulations

    Mrs. Emerson. Mr. Lyons, I apologize. I am still a little 
hung up on this volunteer business. Do you think if you asked 
farmers and producers around the country if they believed the 
TMDL and the AFO/CAFO programs are voluntary, do you think they 
would honestly agree with you? Give me your objective opinion 
about that.
    Mr. Lyons. Well, I don't know how to answer that. They have 
the means, they have the opportunity to deal with these issues 
as they would like currently. And I think you know we certainly 
provide them all the tools and the technology to do so. They 
are not by anything we have done required to do anything under 
TMDLs, and we have had that discussion.
    Under AFO/CAFO we have tried to design a strategy to deal 
with what is a public concern in a way that is going to 
minimize impact on producers. It would address the larger 
operations greater than 1,000 head or more as well as those who 
fail to come into compliance.
    You know, I think--I am saying we still have as a 
foundation a voluntary system for dealing with these issues. I 
think, as Miss Kaptur may note, as the orchardist who sees a 
threat coming, I would suggest to you for American agriculture, 
concerns about environmental quality represent a threat out 
there, and I think we are trying to help producers make sure 
that, you know, they can do what they want to do, stay in 
production, and so in a way that is going to protect the 
productivity of their land as best we can.
    Mrs. Emerson. You know, I would have to say that there 
isn't one producer in my area, and I have a very overwhelming 
agriculture district, who doesn't understand the need to 
conserve the land and take care of it. And so consequently, the 
heavy-handedness of regulation is somewhat problematic because 
I can tell you that even if these programs really are so 
voluntary, it just kind of seems funny that all of the 
``volunteers'', my producers and ranchers, oppose them. It is 
kind of bizarre.

                national conservation forums and summit

    Let me ask you something you just mentioned earlier on in 
your remarks about these five regional forums and then the 
national summit on conservation. Can you provide to my office a 
list not only of the invitees to all of those summits, but 
actually those who were in attendance? I would appreciate 
having that.
    Mr. Lyons. We can do that.

                    small watershed program backlog

    Mrs. Emerson. Let me just ask a couple of questions, if I 
could, on Public Law 566, the Small Watershed Program. Could 
you tell me what the backlog of unfunded projects is in the 
program and what your agency is doing to complete these 
projects in a reasonable time frame?
    Mr. Reed. The unfunded backlog is approximately $1.4 
billion. We are doing everything that we can to encourage the 
funding of these projects from other sources because the level 
of funding for Public Law 566 has been flat and declining for 
the last 2 or 3 years.
    Mrs. Emerson. Can I get you all to provide for the hearing 
record a list of the backlog projects? Could we get a list of 
those projects? That would be terrific.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                 deauthorized small watershed projects

    Mrs. Emerson. Also, let me reference something that was in 
the budget summary, in your all's budget summary, that I think 
is real important. On page 70 it says, ``NRCS will continue to 
reduce the backlog of unfunded work by examining approved 
watershed plans in order to deactivate or revise those that 
have become infeasible or where local sponsor interest is no 
longer strong.''
    Now, I recognize you have to go back and update those 
plans, but that underscores the inadequacy of funds in the 
program. Can you tell me how many projects are taken off the 
list in a given year under this procedure and what percentage 
that is of the total number of projects on the backlog list?
    Mr. Reed. I would have to provide that for you for the 
record.
    Mrs. Emerson. I would be very happy to get that.
    [The information follows:]

       WATERSHED PROJECTS MODIFIED OR DELETED DURING FY 1999-2000
------------------------------------------------------------------------
  State          Project name          Date              Status
------------------------------------------------------------------------
MS.......  Box Creek..............      99/08  Deauthorized.
MS.......  Houlka Creek...........      99/08  Deauthorized.
MS.......  Mantachie; Bogue Fala        99/08  Deauthorized.
            and Bogue Eucuba.
MS.......  Browns Creeks..........      99/08  Inactive.
AR.......  Cedar-Piney Creeks.....      99/08  Installation Complete.
KS.......  Middle Walnut..........      99/04  Installation Complete.
MN.......  Burnham Creek..........      99/07  Installation Complete.
NJ.......  Furnace Brook..........      99/08  Installation Complete.
VA.......  Upper Appomattox River.      99/08  Installation Complete.
AR.......  Caney Bayou............      99/04  Project Life Over.
AR.......  Fleschman's Bayou......      99/04  Project Life Over.
LA.......  Baker Canal............      99/05  Project Life Over.
LA.......  Cocodrie-Grand Louis...      98/12  Project Life Over.
LA.......  North Tensas...........      99/05  Project Life Over.
AZ.......  New Magma..............      99/10  Supplemented.
CA.......  Indian Creek...........      99/12  Supplemented.
CA.......  Upper Stony Creek......      99/12  Supplemented.
MO.......  McKenzie Creek.........      99/08  Supplemented.
MS.......  Tallahaga Creek........      99/11  Supplemented.
PA.......  Red-White Clay Creek...      99/02  Supplemented.
PA.......  Yellow Creek...........      99/08  Supplemented.
------------------------------------------------------------------------

                  Reduced Funding for Small Watersheds

    Mrs. Emerson. But then let me ask you with that big backlog 
why you have reduced the funding for that program from 90.8 
million to 74.4 million?
    Mr. Lyons. Maybe I could address that. I take it you are a 
supporter of Public Law 566 and the watershed program.
    Mrs. Emerson. There are some things I support, yes.
    Mr. Lyons. I know there is a lot you support. I was just 
referring to that program. I would suggest to you, Mrs. 
Emerson, that the same problem that exists with Public Law 566 
and perceptions in that program is the problem that exists with 
the other programs you referenced as regulatory programs.
    There are some who will perceive that the Public Law 566 
program is simply a construction program, and it is going to 
provide for investments and watershed projects that are either 
outdated and/or inappropriate and will cause environmental 
harm. I want to point out that Pearlie and I don't share that 
view. We see the value of many of these projects. We have not 
been able to secure funding for these projects. And I think we 
have an education job to do; you to help us communicate to 
people that these are valuable programs, and I guess obviously 
Pearlie and I to help you understand that we are not forwarding 
or advocating regulatory strategies to deal with the pollution.
    Mrs. Emerson. Can you tell me if the 74 million is your 
number, or is that the number OMB gave you all? What did you 
submit in your budget, and what were you given back by OMB? 
That is a better way of putting it.
    Mr. Reed. What I asked Mr. Lyons for was substantially more 
than that.
    Mr. Lyons. And we didn't get it.
    Mrs. Emerson. But then, Mr. Lyons, can you tell me whether 
you cut it, or did OMB cut it?
    Mr. Lyons. I don't think I cut it.
    Mrs. Emerson. Okay.
    Mr. Lyons. Scout's honor.

                        Forest Management Plans

    Mrs. Emerson. Well, I will take your word for it on this 
one. But if you could give me the information, that would be 
helpful.
    Let me ask you, since I still actually have some time here, 
even though obviously our subcommittee doesn't fund the Forest 
Service, you have responsibility for that agency, and I really 
can't resist asking you a question or two about it, 
particularly about the proposed rule on forest management 
plans, which obviously you can imagine troubles me deeply. I 
think that the proposed rule takes us from a multiple use to a 
single use or a no use.
    And perhaps I often use the expression that some in the 
administration would only like us to go meditate and not use 
wise management of our natural resources, but timber sales, are 
already dramatically down from 5, 10 years ago. And last year--
the appropriated level provided for a total volume offered of 
just 3.62 billion board feet. Do you have an idea of or an 
estimate as to what that rule's impact is going to be on timber 
sales?
    Mr. Lyons. I don't know if I can give you a specific 
answer. I would suggest to you that our view is that the rule 
is certainly not in any way an effort to walk away from the 
concepts of multiple use. In fact, what the rule states is--as 
proposed anyway--is that maintaining the health of the land--
use the term ecological sustainability, and actually that 
termed by a committee of scientists that provided us guidance 
in reviewing the law and recommending changes in the rule--
maintaining ecological sustainability is key to maintaining 
social and economic sustainability. So our goal simply is that 
Multiple Use Sustained Yield Act directs us to do--to maintain 
a sustainable flow of the goods and services that come from the 
National Forest without impairment of the productivity of the 
land. That is the critical phrase.
    So I don't see that as impacting the timber sale program in 
any way. In fact, to the contrary, we have hopes that we can 
increase the use of timbering as a civil cultural tool to 
achieve multiple objectives in addition to producing timber.
    Mrs. Emerson. Considering the monies that you all have 
asked to appropriate is a much lower number of board feet, I 
mean, I am not quite sure that that jibes, but I would ask if 
you all could provide--I assume you have done an economic 
impact or evaluated the economic impact on the forest products 
industry and our rural communities near national forests of 
lowering the volume that is going to be offered. Have you 
determined how much it is going to cost our communities and the 
industry by substantially decreasing the amount of board feet?
    Mr. Lyons. I would suggest to you that our proposal for 
2001 is not a substantial decrease from where we were in 2000. 
What was appropriated by the Congress for timber sales in 
fiscal year 2000, there is a slight decline. We certainly can 
provide the information we have that was the analysis for 
preparing that budget if you would like.
    Mrs. Emerson. I would, in fact, like to do that.
    [The information follows:]

    Your concerns focus on two main issues: multiple use and impacts on 
timber sales and community economics. The answer below addresses each 
of these issues.
                              multiple use
    Regarding the multiple use concern. I can assure you that the 
proposed planning rule builds upon, and will foster, the entirety of 
the agency's legal foundations that encompass the direction given in 
the Multiple-Use, Sustained-Yield Act (MUBY). Inherent in the proposed 
rule's three-part goal of sustainability is the promotion of a wide 
variety of uses, values, products and services through a collaborative 
process that enhances society's capability to make sustainable choices 
across the landscapes they care about.
    The goal of ecological sustainability is consistent with the 
multiple use mission of the National Forest System to develop and 
administer renewable resources for multiple use and sustained yield of 
the several products and services obtained. It is consistent with the 
MUSY direction to provide for harmonious and coordinated management of 
the various resources.
    Further, if meets the NFMA requirement to provide for diversity of 
plant and animal communities based on suitability and capacity of 
specific land areas for meeting multiple use objectives (16 U.S.C. 
1604(G)(3)(B).
                      Timber and economic impacts
    A rule, as a regulatory document (in this case, land management 
planning, has neither economic or timber impacts on any constituent 
group or local community. However implementation of actions done under 
that Rule may have impacts. Thus, we consider and evaluate these 
potential impacts as part of the NEPA process when proposing to revise 
a forest or grassland plan for proposing project-level actions More 
specifically, when the currently proposed planning rule is finalized, 
any proposed plan revisions or subsequent project level proposals will 
be subject to full consideration of economic impacts on potentially 
affected groups, including forest industries and local communities. The 
CEQ Regulations (40 CFR 1508.23) clearly define the point at which a 
proposal exists for meaningfully evaluating effects.

                     Forest Planning Rule Comments

    Mrs. Emerson. The comment--well, I ran out of time, didn't 
I? I am sorry, Mr. Chairman.
    Mr. Skeen. Go ahead with your last question.
    Mrs. Emerson. I know that the comment period on the 
proposed rule closed on the 3rd of February. Can you give me a 
general sense and where the comments are in the time line?
    Mr. Lyons. I am sorry, for the proposed forest planning 
rule?
    Mrs. Emerson. Yes.
    Mr. Lyons. We actually extended the comment period several 
times. In fact, the last time we extended it 11 days to 
accommodate the Chairman of the Senate Energy and Natural 
Resources Committee. We received, I think, 11,000 comments 
during that time frame. We are reviewing those comments and 
meeting with Chief Dombeck and with the Forest Service 
leadership last week to go through comments and all the 
feedback we had received on the rule and have given 
instructions to the rule-writing team to respond to the issues 
raised, the concerns expressed by the public. Comments were 
heard from congressional sources to make rewrites, in some 
cases substantial rewrites, of the rule.
    Mrs. Emerson. So time line?
    Mr. Lyons. We hope to get it finished up later this spring.
    Mrs. Emerson. For the summer sometime.
    Mr. Lyons. Hopefully, yes.
    Mr. Skeen. Mr. Farr.

                      Timber Sales on Federal Land

    Mr. Farr. Just a curious follow-up on Mrs. Emerson's 
question. What is the total percentage of timber sales in 
America that comes off Federal lands?
    Mr. Lyons. I believe our supply--the quantity that we 
supply right now of soft woods, I would be taking a guess right 
now, it is certainly less than 10 percent.
    Mr. Farr. So the rest of the 90 percent of the market is 
controlled outside.
    Mr. Lyons. Most timber produced in the United States comes 
from private sources. A great deal actually is imported from 
Canadian sources in terms of domestic use. We export as well.

                   Legal Liability of NRCS Operations

    Mr. Farr. Of your NRCS jurisdiction, is there anything in 
your services that is not voluntary? You provide technical and 
financial assistance, but people have to ask them, right?
    Mr. Lyons. That is correct.
    Mr. Farr. So let me just suggest, the committee ought to 
consider what I see happening in our area where we are in a 
litigious society, and a lot of the decisions that affect 
policy are made outside the legislative branch. They are made 
in the judicial branch. In a tort era what is happening in 
farming, if you don't learn best management practices, you are 
going to be sued as the results of your less than best 
management practice are going to have a downstream effect on 
somebody's life and property, and they are going to go to 
court.

                      USDA Conservation Leadership

    So I want to just, first of all, compliment you because I 
do think we need some leadership in this country to provide 
upgrading of skills, and where I have seen it is in any area 
that we have cattle ranchers now who through learning better 
skills have totally changed their cattle ranching operation. 
They are into what they call holistic grazing. They graze 
cattle, sheep, and cows and horses together and shepherd them 
from one field to another because they have open ranges. What 
they are finding is that the fields are coming back. This is on 
their own private land they are coming back much stronger and 
much healthier, and yet they are able to also go to the market 
because they are working with nature rather than against 
nature, and they are learning from the technical expertise.
    So I think we need to continue this, as I call it, 
upgrading America's skills on land use, whether it is in our 
forests or ag lands, wherever it may be, because if we don't, 
the consequences are going to be that it is just going to fall 
apart and can't be used for agriculture because there is just 
too many problems that we can't overcome. So we got to sell it 
for urban sprawl.
    So farming is the best defense against urban sprawl. Look 
at California, number one ag State, the number one population 
State, and yet in areas like the Salinas Valley, which I hope 
our committee can see sometime where our land is worth $35,000 
an acre, farmers are still doing best management practices and 
able to say, I would rather be in farming.
    Mrs. Emerson. Would the gentleman yield?
    Mr. Farr. Yeah.

                 Private Sector Conservation Leadership

    Mrs. Emerson. Let me comment that my farmers and ranchers 
are doing the same thing, but they are doing it voluntarily. 
They are not having the heavy hand of government come down and 
tell them they have to do it, because they know if they don't 
do it, they will not be successful.

                  Farmland Protection Program Funding

    Mr. Farr. We are not in disagreement, because it is all 
voluntary in California, only you have many other pressures. 
You have local and State laws that are so much tougher than 
anything the Federal Government has ever thought of, and yet 
they are making it.
    The point I would like to get down to here, is your budget 
request for farmland protection? I mean, we don't have any 
money in that program. Miss Kaptur just talked about the fact 
that people need it, we need to do it. We have $35 million. It 
was authorized, and it was spent in 1998. What is the 
Department going to do to send this new authorization language 
up to the Hill for the $65 million in the budget request? When 
are you going to do it?
    Mr. Lyons. I know we are working on it, Congressman. I 
think that one is fairly simple. It is simply a change in the 
authorized cap. So we could get that--Steve has to clear all 
these things.
    Mr. Farr. Do you have $35 million authorization now, so if 
this committee put $35 million into that program, you are 
authorized to spend it?
    Mr. Lyons. We spent the authorization, so we need an 
increase in the authorization.
    Mr. Farr. And then where would the money come from for the 
program?
    Mr. Lyons. CCC. It would be increased funding out of CCC.
    Mr. Farr. You are not going to the land and water 
conservation fund, I hope.
    Mr. Lyons. That is not what we have proposed.
    Mr. Farr. It was proposed last year. It didn't work. It was 
outside our jurisdiction.

            Environmental Quality Incentives Program Funding

    Your request for EQIP program is $125 million above the 
authorized level?
    Mr. Lyons. It is about $300 million.
    Mr. Farr. When are you going to ask for the authorization 
language?
    Mr. Dewhurst. All of these proposals will be part of the 
administration's safety net program for farmers which will be 
submitted. I am not in a position to give you an exact date, 
but certainly within the next couple of weeks. And all the 
financing for the conservation initiatives in that package 
comes from the Commodity Credit Corporation.

                         Air Quality Task Force

    Mr. Farr. Okay. Lastly, just let me--time has run out.
    Mr. Reed, you served as chairperson of the Ambient Air 
Quality Task Force. I understand that recently the task force 
has made recommendations on two major issues of extreme 
importance to agriculture. The issues are burning of 
agricultural residue and a proposal to develop voluntary 
incentives based on the Air Quality Compliance Program. Could 
you let me know perhaps--I don't want to take the Chairman's 
time--what the status of those recommendations are?
    Mr. Reed. Mr. Lyons signed off this week.
    Mr. Farr. Okay. Thank you. You are doing a good job on that 
program. You are to be commended.

          URP Heritage Rivers, and Pacific Salmon Expenditures

    Mr. Skeen. Mr. Lyons, you submitted a letter for the record 
that I signed on January the 28th, 1998, regarding the 
expenditure of funds for Urban Resources Heritage Rivers and 
salmon recovery initiatives. And I will submit for the record 
the House report language that accompanied the fiscal year 1999 
appropriations bill. The report language directs the agency 
that the funds are not available until reprogramming requests 
are approved.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                          Reprogramming Funds

    Mr. Skeen. I would point out that the USDA has never 
submitted nor did we ever approve reprogramming the use of 
those funds.
    Mr. Lyons. Well I appreciate that, Mr. Chairman. We would 
like to work with you on that. If we have to submit that, I 
suppose we will. I think one of the issues of debate, and you 
are the boss, was that we felt that under conservation 
operations, we had the authority, which is what led to the OGC 
reviews that we asked for. We want to work with you, Mr. 
Chairman, on that and make sure that what we are doing comports 
with what your wishes are.
    Mr. Skeen. Thank you.
    And Mr. Nethercutt.

                 CRP Technical Assistance Availability

    Mr. Nethercutt. Thank you, Mr. Chairman.
    Welcome to the witnesses.
    Last year there was testimony here regarding the financial 
needs of the agency, and also there was a question about 
continuing funding for technical services for producers who 
were establishing CRP cover crops. I am wondering what happened 
with respect to those particular funds.
    Apparently during the process of establishing cover crops, 
the agency suspended its service because of a shortage of 
funding, and producers were caught with programs partially 
completed. In many parts of the West, we have timing 
requirements to make sure that, due to weather patterns, we get 
our cover crops planted, and that there is going to be a 
succession that the termination of service seriously 
jeopardized that important phase of CRP. Congress eventually 
supplied, I think it was $28 million in fiscal year 1999 
emergency supplemental appropriation bill. I am wondering if 
there are ample funds this year in the budget to allow the 
program, the Technical Services Program, to continue.
    Mr. Reed. No, sir. We have approximately $33, $35 million 
shortfall.
    Mr. Nethercutt. How much, sir?
    Mr. Reed. About a $33 to $35 million shortfall.
    Mr. Nethercutt. How do you plan to get around this very 
serious problem?
    Mr. Reed. We talked about that a little bit earlier. I will 
defer to Mr. Dewhurst to give the same response.
    Mr. Nethercutt. See if he gives the same response.
    Mr. Dewhurst. We are working with OMB. You know, the 
problem is the cap in the farm bill and how much money the 
Commodity Credit Corporation can provide for technical 
assistance. The solution to the problem not just in 2000, but 
in the future lies in either eliminating or raising that cap.
    The appropriation you provided was kind of a stop-gap last 
year. Frankly, we would hope there was a better way to solve 
the problem this year, but it is just a matter that we are 
having to look at with folks across town.

                         Conservation Easements

    Mr. Nethercutt. Well, it is a problem. And if we want to 
accomplish the good things CRP has in mind, we've got to make 
sure that the farmer isn't left wanting.
    During the 18th sign-up of CRP, bids were accepted in some 
instances in our State--in my district actually--were twice as 
high as the average cash rent for croplands. We are seeing 
whole farms go in to CRP, and, you know, CRP removes that land 
from the rural infrastructure and the support remaining as well 
as necessary for those remaining farmers. We are finding an 
incentive to put whole farms into CRP at the cost and expense 
of those who want to keep farming, the young guys who are out 
there trying to make a living and need land to farm. I know 
that this is an FSA responsibility, but I am wondering to what 
extent you all are coordinating with FSA to address that very 
real differential.
    Mr. Reed. We really aren't from an NRCS standpoint.
    Mr. Nethercutt. Should you?
    Mr. Reed. We should be. And we are in a continuous dialogue 
on these issues, but when it comes to those issues relative to 
those programs that FSA administers and how that plays with 
respect to these 25 percent limits and things like that, we 
defer to them.
    Mr. Nethercutt. It is real, and it does cause those young 
farmers who want to continue farming--and it really makes sure 
the maintenance of the infrastructure of the rural counties and 
communities is there. It is a very real problem, and so I would 
appreciate your thinking about it. Maybe we can further figure 
out ways to address it.
    Mr. Reed. I would like to add, Mr. Nethercutt, we are 
having a similar kind of problem as it relates to WRP with the 
tax situation and the impact that it is having on local 
communities.

             Resolving Clean Water and Clean Air Challenges

    Mr. Nethercutt. Mr. Lyons, I know the earlier discussion--I 
am informed and apologize for not being able to be here. I had 
another hearing in Interior, and so I am sorry I missed your 
comments, but I understand there was a focus on clean water 
issues, not necessarily clean air issues. The farmer is caught 
in between, especially the blue grass production industry in my 
State. Blue glass production has literally been removed because 
of air quality problems and challenges that have been raised. 
At a time when the farmer is trying to control residue, using 
burning to meet residue requirements for clean water, the 
farmer is finding him or herself in the middle of clean air 
versus clean water. And again, it is a challenge to try and 
stay in business. I am wondering to what extent you are trying 
to address these clean air and clean water challenges 
simultaneously.
    Mr. Lyons. Congressman, I don't know that we have done an 
adequate job to try to deal with the nexus between clean air 
and water. I think we have an obligation to do that for your 
producers and across the country. We have some serious 
challenges in your part of the world. I don't know if you had a 
chance to see this map, but that red blob is your district.
    Mr. Nethercutt. I know. You say that respectfully.
    Mr. Lyons. I do. I do, sir, and we have talked about the 
challenges. I think we have a joint obligation to help 
producers stay in business, and erosion is not just an erosion 
of land for your producers, it is an erosion of profits, and 
therefore it is critically important we figure out ways to do 
that. We are trying to do that.
    Mr. Nethercutt. It is a State issue relative to the air 
quality and blue grass, but Federal by the EPA, I believe. We 
are seeing all the blue grass production now go over to Idaho, 
which then as--we look at the wind patterns, a lot of that 
smoke comes back into eastern Washington, and the people get 
upset. In the meantime we have lost a lot of blue grass 
producers, and that has had a negative impact on our economic 
structure in eastern Washington. So, it is a tough job, but, it 
sure needs some coordination and some common sense with the 
respect to the ability to burn crop residue.
    Mr. Lyons. We will try and do a better job with it.
    Mr. Skeen. Mr. Boyd.

                    Voluntary and Mandatory Programs

    Mr. Boyd. Thank you, Mr. Chairman. And I want to follow up 
on an issue that Mr. Farr addressed. I think he asked Mr. Reed 
the question about the administration of programs, voluntary as 
opposed to mandatory. But it is my understanding that there are 
some mandatory programs. I know it is mandatory that if you are 
going to farm, that you have a conservation plan in place that 
you have to follow and implement. And I want to make sure that 
our record didn't reflect that you only administer voluntary 
programs.
    Mr. Reed. There are compliance requirements.
    Mr. Boyd. We have addressed that earlier. There are 
compliance requirements.
    Mr. Lyons. But, Mr. Boyd, don't lose sight of the fact that 
if a producer elects to be part of the program----
    Mr. Boyd. I understand that. If you are going to farm, you 
must comply.
    Mr. Lyons. If you are going to farm in the programs.
    Mr. Boyd. I say, again, if you are going to farm, you must 
comply because you won't farm long if you don't farm in the 
programs, at least not in my part of the world.
    We have had a discussion here today about the technical 
assistance plus-ups that you want, and we have had an extensive 
discussion about the lack of adequate personnel, resources, 
training, those kinds of things at the county level, and that 
is working against us. Everybody has, I think, here has beat 
that around a little bit.

                 Conservation Security Program Request

    My first reaction when I see the budget request for new 
programs, and I refer to the Conservation Security Program, is, 
you know, we can't even administer and implement the ones that 
we have in place now. So my first reaction is why do we want to 
further use our resources in trying to implement a program 
which in this case is probably duplicating? I think we got 
plenty of programs in place. So that is my first gut reaction 
based on your summary of the program.
    I would like to ask Mr. Reed or Mr. Lyons, or some of your 
folks to come in and talk to us about the details of this new 
program and how are we going to mesh it in with the whole farm 
security net issue. And I don't want to take up the committee's 
time now because I have another area that I want to go into, 
but I would like to have that if we could do that.
    Mr. Lyons. We submit to do that, Mr. Boyd, I want to say 
one thing. That is we did meet with staff yesterday and 
discussed the fact that we intend to put some proposals 
together, but we want to sit down with you. We know we have a 
short legislative year. We want to sit down and work these 
things through. I think Secretary Glickman met with a number of 
members with the Agriculture Committee yesterday and discussed 
some efforts.

                      Stopping Farmland Conversion

    Mr. Boyd. In that vein, I know you handed out some charts 
earlier. You referred to them, one earlier which doesn't give 
us a benchmark to go against, but the others do. One is a total 
erosion of cropland, and you see between 1982 and 1995 you 
refer to the fact that probably the major cause of this 
significant decrease in cropland use is the CRP program, which 
I concur with and I am a great advocate of.
    I would submit to you and to the other Members that the 
real problem is what Miss Kaptur referred to earlier, and that 
is acreage or farmland conversion to development. And I would 
submit to you that maybe our major focus should be figuring out 
how to stop that. And I know Mr. Farr and others have referred 
to the Farmland Protection Program, which I know the States are 
doing much in areas into conservation, development rights and 
those kind of things.
    Now, I want to ask your indulgence, Mr. Chairman, and the 
indulgence of the committee to go back and address the forest 
issue, because this is the only opportunity we have to address 
Mr. Lyons in this setting. And I know it is not our area of 
purview, but I would ask your indulgence to do that.
    Mr. Skeen. We are indulged.

         National Forest System Payments to States and Counties

    Mr. Boyd. Mr. Lyons, are you familiar with H.R. 2389?
    Mr. Lyons. If you tell me the title of it, I bet I am.
    Mr. Boyd. It is the Secure Rural Schools & Communities, 
Self Determination Act.
    Mr. Lyons. Yes, very much, sir.
    Mr. Boyd. We had a great discussion and debate about that 
last year. Now, I heard today that some people in your 
Department have gone to the Senate and said they want to sit 
down and write a bill in the Senate. Now, Mr. Lyons, we had a 
discussion earlier about forest policies, management practices, 
and you know what we tried to do with H.R. 2389 is set those 
controversial issues aside. We are not going to resolve those 
here. Those are in court, many of them being decided in the 
judicial system, based on interpretation of current law, and 
that is an issue that will not be resolved immediately.
    But there is a consequence to the changed timber management 
practices, and that is that our local schools in these forest 
communities, are being devastated. And what we tried to do when 
we wrote H.R. 2389 was to solve that specific problem, not 
solve the issue or the debate about harvest management 
policies, but simply our goal was to set that aside and solve 
the issue of school funding.
    Now, Mr. Lyons, I attempted on several occasions to have 
discussions with your staff and get your constructive input so 
we could come to an agreement. But, unfortunately, the 
administration continues to oppose this piece of legislation 
which simply tries to address the school functioning issue. It 
doesn't address management practices at all. I don't understand 
why the administration continues to oppose solving the problem 
in funding our local school districts. In the communities where 
the government owns the land and has taken it off the tax 
roles, they have destroyed the economic base because of their 
timber management practice changes. So I hope you will address 
that.
    Mr. Lyons. If I could, Mr. Chairman, I would be glad to. 
You are right, Congressman. We continue to oppose the House-
passed bill. We are engaged in a discussion with the Senate 
staff. Senator Wyden, Senator Craig requested that we begin 
that dialogue. We are working on the language there. I think it 
is important to importantly characterize the bill there because 
it doesn't simply deal with school funding. We were pleased to 
deal with that issue, and I made that commitment many times 
before.
    Your bill does a little bit more than that, though. It 
creates a very complicated structure that would introduce a new 
concept, and that is it will require the communities to commit 
20 percent of the funds they get under that bill to developing 
community-based and driven projects on the ground. It would 
create an imbalance in the committees, would provide guidance 
to that. And furthermore, it provides no mechanism to fund this 
program. We have a tremendous fear that that will then result 
in appropriations being taken away from the Forest Service to 
implement the basic programs we need to implement.
    We remain committed to try and address the school funding 
issue. I agree completely this should not be about forest 
policy, it should be about education in rural communities. So 
we are working with Senators Wyden and Craig at their request 
to try and work through our differences over the legislation, 
see if we can't come up with something that the administration 
can support. I agree completely with you about the need to come 
up with a reliable, sustainable and certain source of funding 
to deal with rural education needs which have been impacted by 
changes in Federal forest policy, reduced revenues to those 
communities. We do need to address that. We are anxious to 
figure out a way to do that.
    Mr. Boyd. Mr. Lyons, first of all, Mr. Chairman, if I might 
conclude this--number one, the mechanism to fund, as you know 
we changed the language in the House at your request because 
you opposed the old language. And so that made it such that we 
had to find the funding, and we are asking the administration 
to help us identify potential sources. I personally had a 
discussion with the Vice President about that, and he agreed at 
the time we had a discussion to help.
    Mr. Lyons. We do want to do that, sir.
    Mr. Boyd. The other is you opposed the community project 
language. Earlier today in a statement you made, you said, I 
will paraphrase, ``the way to solve problems is not getting in 
the face of those who happen to have a different view and those 
you have to work with.'' And the community project is designed 
to do just what you described earlier in your answer, and that 
is to have people who have opposing views about management 
practices to come together to decide how to resolve, or what 
projects those would be.
    Now, it doesn't take away any authority of yours. Every 
regulation, policy rule and law of the Forest Service still has 
to be followed. And for the life of me I don't understand why 
you oppose this legislation on that basis, because it doesn't 
undermine the authority you have under existing law. It simply 
puts people who are on opposite sides of this fence for a long 
time in the same room and requires them to agree before 
anything is done, and I think that is good policy and will move 
us a giant step forward in helping resolve this whole timber 
management practice issue. So I hope you would rethink that.
    Mr. Lyons. Well, it is appropriate for you to have the last 
word, Congressman, so I will leave it at that. So I look 
forward to sitting down and talking with you over the 
differences we still have over the bill.
    Mr. Skeen. Mr. Latham.

                   voluntary preservation of farmland

    Mr. Latham. Thank you, Mr. Chairman.
    A lot of this discussion about, you know farmers, Mrs. 
Emerson brought up about what farmers are doing as far as soil 
conservation, and just as a statement I personally take offense 
to anyone who implies that farmers voluntarily are not going to 
do everything they can to preserve what is their number one 
asset, their land, and I will--as someone who lives on a farm 
myself and who drinks out of a well, that my family, my kids--
the idea that somehow farmers are not the number one front line 
people as far as soil conservation is concerned, as far as a 
clean environment is concerned is very offensive to me.

                  federal regulations for agriculture

    And I will tell you also the biggest threat, we talked 
about it last year, to our water supply in upper Iowa, in the 
aquifer, is four Federal agencies today. Somehow people think 
in agriculture you are only regulated by USDA, I mean, which is 
insane if you have to deal with EPA, with Fish and Wildlife, 
with the Army Corps of Engineers, plus EPA to try and fix a 
problem which is going to have a tremendous negative impact on 
water quality in that aquifer, because four Federal agencies 
can't agree on anything. And just the idea that somehow--I wish 
we could just deal with you. But, I mean, there is a feeling 
somehow in urban areas that the only thing farmers have to deal 
with is just the USDA, which is--if you come to my district, I 
will show you how totally outrageous that is. And it is one 
reason why we are extraordinarily sensitive to EPA coming in 
and getting additional authority in our area, because they 
can't manage what they are doing now in a logical, commonsense 
way.
    And I guess that is the point I think needs to be made. I 
think maybe some of our urban friends--that we are not out here 
trying to be the big polluter. We are trying to fix the 
problem. We can't do it because of four Federal agencies that 
won't talk to each other, all claiming jurisdiction. I am 
sorry, but it really is frustrating.

                         other budget proposals

    And my question goes somewhat in the same vein. In your 
testimony there is this livability initiative and the budget 
proposals to provide $5 million for a community Federal 
information partnership and $5 million to help farmers plan and 
develop and implement biomass systems. If you could describe a 
little bit more about this initiative, and also what is your 
agency's role as far as biomass?
    And also I would really like to have you comment, too. We 
have this huge--I was out in Seattle, and the issue of the 
genetically-modified organisms--which anyone who looks at it 
from an environmental point of view should believe that using 
less fertilizer, using less chemicals, having much less 
opportunity even for spills or for runoff, buffer zones, 
filtration, which everyone wants to have, but if you are using 
less chemicals and fertilizers because of these products, I 
mean, to me it makes sense that the environmental community 
should be 100 percent behind these things. I question why they 
are not.
    But I have asked about four questions there. If you would 
respond.
    Mr. Reed. Jim, do you want me to do this one?
    Mr. Latham. Come on, Pearlie. Come on, buddy.

                      biomass products initiative

    Mr. Reed. Okay. On the biomass activity, it is primarily to 
fund about 11--the equivalent of 11 FTE to help with the USDA's 
part of carrying out the President's executive order dealing 
with this particular issue as it relates to a lot of other 
things. The details on it I can't give you, but I could provide 
that for the record.
    [The information follows:]

                                Biomass

    The biomass initiative is based on the President's 
Executive Order 13134 concerning developing biobased energy and 
other products. It seeks to achieve greater use of renewable 
resources and reduce dependency on imported and domestic energy 
sources like oil or fossil fuels. The President's budget 
requests $5,000,000 for NRCS to fund 11 staff years of 
assistance during FY 2001 and provide funds for competitive 
grants. NRCS has stressed two priorities: (1) expansion of 
feedstock production for biobased products or bioenergy should 
occur commensurate with protection of natural resource values; 
and (2) local communities should be key for organizing biobased 
energy projects and enterprises that are environmentally, 
economically, and socially sustainable.
    With this funding, NRCS would use $1,000,000 to develop 
technical standards and provide training to field staffs so 
that they can provide direct technical assistance to producers 
and local communities interested in biomass enterprises. The 
remaining $4,000,000 would be used to provide competitive 
start-up grants for community projects on biomass energy.

               community/federal information partnership

    Mr. Latham. So you didn't ask for this funding?
    Mr. Reed. No, I didn't.
    Mr. Latham. You are a great American.
    Mr. Reed. But that doesn't mean I don't support it.
    Mr. Latham. I know. In your position you probably have to.
    Mr. Lyons. You see why Pearlie is Chief.
    Mr. Reed. On the community, slash, Federal information 
partnership, of course that would be funds made available for 
the NRCS to participate appropriately along with all the other 
USDA agencies in some of this Federal geographical data 
committee-type activities. And this is another one that did not 
come from the bottom up, but it is something that we certainly 
should do and is needed in order for us to be a part of the 
larger community and pick up the efficiencies that are needed 
dealing with this particular issue. And those were the two that 
I picked up.
    But you said you asked four questions.

           using sound science to assess agriculture changes

    Mr. Latham. Well, about the--I guess I question, you know, 
your agency's role as far as biomass. And does the Department 
have a position as far as GMOs and how positive it would be for 
the environment or negative?
    Mr. Lyons. Mr. Latham, all I can tell you on that subject 
is that the Secretary has spoken a number of times on the issue 
of GMOs.
    Mr. Latham. If I could, as it relates to the initiatives as 
far as your jurisdiction.
    Mr. Lyons. I don't know that we have made any formal 
statement in that regard. I would share this is another area 
where perceptions contrary to scientific fact seem to be 
driving the debate. I mean, you are aware of the Frito-Lay 
decision with regard to corn, genetically modified corn, I 
think, which baffled many in the industry and many in the 
agriculture community. But it seems to be one of those 
decisions that is driven by public perceptions or concerns 
about the impacts on their ability to market genetically-
modified products. The science doesn't support the health risk 
concerns that apparently are there.
    In fact, what we can do with regard to reducing 
environmental inputs, nutrients, pesticides, et cetera, would 
seem to me to make a solid argument for the utility of this 
technology. But nevertheless, there is this huge public issue 
that has to be dealt with. I know the Secretary is trying to 
capitalize on opportunities to get that debate out in the 
public forum so we can have an honest discussion about what we 
know is scientifically sound and the technology that is 
available and how we deal these.
    Mr. Latham. I would just apologize, Mr. Chairman, just for 
one statement. I guess I think you could play a key role by 
using sound science to take a position, a positive or negative. 
But I think there is a huge environmental impact here, and I 
think a case could be made that this, maybe, is one of the most 
positive things. We are talking about maybe not using any 
pesticides. We are talking about limiting use of fertilizer to 
fractions of what current level usage is. I mean, I would think 
you would have a position somewhere.
    Thank you, Mr. Chairman.
    Mr. Skeen. Thank you.
    Mr. Hinchey.

           long range view of agriculture and the environment

    Mr. Hinchey. Thank you, Mr. Chairman.
    I just want to say that I think it is obviously very 
important with regard to this particular subject to take the 
longest-range point of view. I know that that is what you seek 
to do in your responsibilities, and by so doing, you are 
providing a great service to the country. The protection and 
preservation of these natural resources and the use of them in 
the most appropriate way is invaluable, not so much to us, 
perhaps, as it will be to future generations. That is the most 
important thing that we have to keep our eye on here. I want to 
congratulate you for the efforts that you are taking in that 
regard.
    Also, with regard to the efforts that you are proposing in 
this budget to rationalize conflicts between agriculture and 
the environment, I know that is an ongoing thing, and it is an 
issue that I think is very important. I see it in a very 
practical way with regard to the New York City watershed that I 
was talking about before. I would just ask you if you would, 
not necessarily this moment, but at some point have a 
discussion with us with regard to the environmental quality 
incentives and the conservation reserve as well as the new 
Conservation Security Program and ways in which they can be 
used specifically to deal with the issue of agriculture in a 
watershed. I would be very grateful to you for that.

                staff needed for program implementation

    At the risk of being unnecessarily repetitive, let me just 
underline once more the problem that I see with regard to the 
implementation of these programs, given a shortage of staff. It 
is a very practical problem that the services just cannot get 
out to the needed recipients unless you have the human beings 
to deliver them. No matter how you cut it, there is no way to 
get around that. I know this is something you know, but I think 
it has to be said from this side of the table as well. So I 
want to express that to you and thank you very much for your 
efforts.
    Mr. Lyons. Appreciate that very much, Congressman.
    Mr. Reed. Thank you.

                        timber supply correction

    Mr. Lyons. Mr. Chairman, if I could correct the record. I 
did get--one thing I just wanted to answer the question on 
timber supply that was raised to me earlier. The national 
forests contribute 5 percent of the total national demand for 
wood in the United States. Of that, 5 percent comes from 
roadless areas. So we contribute 5 percent to the total wood 
basket of the United States; 5 percent of what we produce comes 
from roadless areas.
    Mr. Skeen. You have done a very good job. Thank you very 
much for your patience and the answers.
    Mr. Farr. Great job, Mr. Chairman.
    Mr. Skeen. Thank you. Thank you all for being here. We have 
worn out a whole bunch of the day, but I think we have done a 
good job, and the pertinent information is there. We wish you 
the very best. Come by and see us once in a while.
    Mr. Lyons. Will do.
    Mr. Skeen. Thank you all. We are adjourned.
    [The following questions were submitted to be answered for 
the record:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                         Wednesday, March 15, 2000.

                   MARKETING AND REGULATORY PROGRAMS

                               WITNESSES

MICHAEL V. DUNN, UNDER SECRETARY, MARKETING AND REGULATORY PROGRAMS
CRAIG A. REED, ADMINISTRATOR, ANIMAL AND PLANT HEALTH INSPECTION 
    SERVICE
KATHLEEN MERRIGAN, ADMINISTRATOR, AGRICULTURAL MARKETING SERVICE, 
    ACCOMPANIED BY KEN CLAYTON, ASSOCIATE ADMINISTRATOR
JAMES R. BAKER, ADMINISTRATOR, GRAIN INSPECTION, PACKERS AND STOCKYARDS 
    ADMINISTRATION
DENNIS KAPLAN, BUDGET OFFICE, DEPARTMENT OF AGRICULTURE

                            Opening Remarks

    Mr. Skeen. The committee will come to order and we will go 
on the record.
    Today we have with us Mike Dunn, the Under Secretary for 
Marketing and Regulatory Programs. Mr. Dunn is responsible for 
the Agricultural Marketing Service, the Grain Inspection, 
Packers and Stockyards Administration and the Animal and Plant 
Health Inspection Service. That is a pretty good plateful. Mr. 
Dunn's team has one new member who has not been before this 
subcommittee, and that is Ms. Kathleen Merrigan, who was 
appointed Administrator of the Agricultural Marketing Service 
last year. We welcome her here today.
    Glad to have you here.
    Ms. Merrigan. Thank you.
    Mr. Skeen. The Under Secretary and his Administrators 
manage a wide range of issues very important to the committee. 
This is a busy day with a lot of subcommittee hearings. I ask 
for cooperation from everyone so that Members can make maximum 
use of their time while we are here.
    Before I ask Mr. Dunn for his statement, I would ask the 
distinguished gentlewoman from Ohio, Miss Kaptur, if she has 
any opening remarks.
    Miss Kaptur. Thank you, Mr. Chairman, very much. I 
apologize for being late. There were three things going on at 
once, including a competing subcommittee hearing. Someday when 
I become Chair of Appropriations, 50 years from now, I am going 
to computerize all meetings. So that they don't occur at the 
same time.
    Mr. Skeen. No apology necessary. We appreciate your time.
    Miss Kaptur. I want to welcome the Under Secretary and all 
of those very capable individuals that have come over this 
morning from USDA.
    I just wanted to say that the world is a brighter place 
today, Mr. Chairman, because the staff director of this 
committee, Hank Moore is a new grandfather. We congratulate him 
and his family. His first grandchild. I think we ought to give 
that family some applause.
    Mr. Skeen. Just wait till you get a houseful of them.
    Mr. Dunn, we will recognize you for your statement.
    Mr. Dunn. Thank you, Mr. Chairman and members of the 
committee. I am indeed pleased to be here before you today to 
discuss the activities of the Marketing and Regulatory 
Programs. I have with me, besides the folks here at the table, 
Dr. Enrique Figueroa, who is Deputy Under Secretary for 
Marketing and Regulatory Programs, in the audience; Mr. Jim 
Baker, who is the Administrator, Grain Inspection, Packers and 
Stockyards; Dr. Craig Reed, who is the Administrator of Animal 
and Plant Health Inspection Services.
    You have already introduced Ms. Kathleen Merrigan, who is 
the new Administrator for the Agricultural Marketing Service. 
Then we have Dennis Kaplan with OBPA, who is here with us to 
round out the members at the table.
    Mr. Chairman, I hope we are able to present our prepared 
statements for both myself and the administrators as part of 
the record.
    Mr. Skeen. Yes, we will do that.
    Mr. Dunn. I would like to give the committee an overview of 
what we are facing in the programs today and the current 
situation in agriculture as we see it. Certainly agriculture, 
the agricultural economy, is in a state of change.
    Concentration and consolidation is taking place in an 
unprecedented amount. That has increased the demand for 
marketing regulatory programs to have more oversight to ensure 
a level playing field for producers. It has increased the 
demand for more information that is transparent in price 
reporting. It has increased the demand for more knowledge about 
how large entities operate vis-a-vis small producers and 
family-size operators.
    Methods of sales are changing very rapidly, moving away 
from the spot market towards contracting and vertical 
integrations. There are more alliances; more cooperatives and 
direct marketing alternatives are being explored by producers. 
New markets, such as organic and sustainable, are niches that 
we see for family farm operations to get into to remain viable.
    Genetically Modified Organisms (GMOs) have raised concerns 
by consumers, environmentalists and by our foreign trade 
partners, which has had an effect on producers, handlers and 
processors. There is concern over our regulatory regime and how 
we regulate GMOs. There is demand for identity preserved and 
segregation of product in shipment. There is demand for 
validation of those who are certifying the content of a 
shipment to be either GMO or GMO-free.
    Increased international trade and travel have also 
increased the demands on marketing and regulatory programs. 
Greater requirements for international information on price-
setting of common standards have been requested.
    The WTO and NAFTA have increased the need to provide 
technical knowledge transfer and foreign capacity building to 
convince our trading partners that our marketing and regulatory 
standards are an efficient and effective means of assuring the 
quality and quantity of delivered products, and that the animal 
and plant health of our trading partners are assured.
    Over 80 million passengers visited us last year. The volume 
of trade coming into this country is doubling every 6 years. 
This volume is producing a tremendous strain on our ability to 
protect our animal and plant resources.
    On the plant side, in 1998, we detected 250 new plant pest 
infestations, and in 1999 that grew to 334 new finds, an 
increase of 84 in just 1 year. On the animal side, the National 
Veterinary Service Lab received and tested over 37,000 
diagnostic submissions. They helped us to confirm the presence 
of West Nile virus. They assured us that Bovine Spongiform 
Encephalopathy and Classic Swine Fever was not yet on our 
shores. However, recent disturbing finds, such as horses being 
shipped into the United States that have been infested with 
screwworm, reminds us that we are only one slip-up away from 
having a disaster on the animal side. Outbreaks of Citrus 
Canker, Plum Pox Virus and Pierce's Disease are costly 
testimony to our need for early detection and new efficient and 
effective tools to protect our agricultural economy from such 
threats.
    Ongoing eradication and prevention programs are striking 
successes, and they prove that we can reverse infestations when 
we demonstrate that we have the resolve to do so. However, the 
100 million acres lost to invasive species, which is increasing 
at an alarming rate of 3 million acres a year, cry out for us 
to do more.
    Citizens are very concerned about the administration of the 
Animal Welfare Act and the Horse Protection Act and this has 
been on the rise, a concern of citizens. Not a day goes by that 
I don't receive information in my office about alleged 
violations of the Act, stories of mistreatment, maiming and 
death of exhibit animals are all too frequent headlines in the 
nightly news and in the newspapers. And when an animal causes a 
human death, sometimes an unsuspecting spectator, I receive 
volumes of correspondence asking who's in charge and how could 
this happen.
    The animal care unit of APHIS has done a tremendous job of 
reinvention, and in doing more with less by targeting resources 
at worst offenders. I have received thousands of congratulatory 
letters on their successes, but it is now time for us to catch 
up and provide the fiscal and human resources they need to do 
the job that I demand and that you have legislated them to do. 
To address these problems, Mr. Chairman, Marketing and 
Regulatory activities are funded both by taxpayers and 
beneficiaries of program services.

                          2001 budget request

    On the appropriations side, APHIS is requesting $512 
million for salaries and expenses, $5 million for building and 
facilities; Agricultural Marketing Service is requesting $92 
million for salaries and expenses, and Grain Inspection, 
Packers and Stockyards is requesting $33.5 million for salaries 
and expenses. Authorizing legislation was submitted in the 
first session of the 106th Congress that if it was enacted 
would recover $30 million more in user fees for fiscal 2001. 
GIPSA's budget request for 2001 is $33.5 million, salaries and 
expenses, and $42.6 million to be spent from industry user fees 
in our revolving fund for Grain Inspection. The appropriated 
request for Packers and Stockyards is $19.3 million, an 
increase of $4 million. This includes $1.2 million to develop 
models which could be used to verify the existence of 
anticompetitive behavior, $1.3 million to expand the rapid 
response teams, $800,000 to examine the competitive structure 
of the poultry industry and $400,000 to establish a swine 
contract library to implement the Livestock Mandatory Reporting 
Act.
    The request for Grain Inspection is $14.2 million, an 
increase of $2.1 million. Nearly $2 million requested for 
developing new biotechnology testing methods, analytical tests 
and greater quality assurance procedures in grain. This will 
enable the agency to begin the process of addressing the 
changes occurring due to biotechnology. Grain Inspection also 
requests $150,000 be used to address the emerging sanitary and 
phytosanitary standards required under the WTO and NAFTA.
    A request of $100,000 to enhance GIPSA's civil rights 
commitment and a request of $350,000 for an information staff 
to improve communications with the livestock, meat, poultry and 
grain industries is included. Legislation has been proposed 
that, if enacted, would authorize the collection of $23.1 
million in new license fees for administering the Packers and 
Stockyards programs and increasing Grain Inspection user fees 
to cover the cost of maintaining grain standards.
    APHIS proposes $512 million for salaries and expenses, a 
$74.3 million increase above the fiscal year 2000 estimate. 
This large increase for 2001 largely reflects the decision to 
fund through appropriations several emergency programs that 
have been started with funds transferred from the Commodity 
Credit Corporation. There is also an increase of $8.8 million 
for the new Invasive Species Initiative. A $3.9 million 
increase for the AQI appropriated program would lower the 
threat of exotic agricultural pests and diseases entering the 
United States.
    A $2 million increase for the international programs would 
help USDA officials and trading partners resolve pest and 
disease problems and sanitary/phytosanitary-related issues.
    Our second line of defense is animal and plant monitoring 
whose ongoing emergency programs will identify small outbreaks 
before they have a chance to become major infestations. An 
increase of $9.3 million would provide a strong foundation for 
these efforts in monitoring plant and animal health. $5.2 
million of the increase would allow APHIS to address several 
vulnerable areas in the emergency management program and will 
enable us to improve our response to animal disease threats.
    Emerging plant pests remain a significant management issue 
for APHIS. An increase of $25 million would provide $20.5 
million for an ongoing Citrus Canker eradication program in 
Florida and $4.6 million to ongoing Asian Long-Horned Beetle 
programs in Illinois and New York.
    The Animal Welfare budget request is seeking $15.2 million, 
an increase of $5 million over the fiscal 2000 level. These 
funds would maintain the current activities, increase the 
number of inspections and improve follow-up to verify 
corrections of violations found during these inspections.
    $5 million is proposed for general maintenance to the 
support and modernization of Plum Island Animal Disease Center 
facilities for 2001. In addition, APHIS is in collaboration 
with Ag Research Service in requesting $9 million to begin the 
modernization of the National Veterinary Service Lab in Ames, 
Iowa.
    The Agricultural Marketing Service budget includes an 
increase of $18 million. A total of $92 million is requested 
and appropriated in Section 32 funding to support a number of 
activities that support our strategic goals. Additional 
fundings would be used to continue the Mandatory Price 
Reporting for livestock program begun in 2000. That request is 
for $5.9 million. We would ask $400,000 to expand voluntary 
market news reporting to include more data on international 
markets.
    To implement the National Organic Standards program, we are 
requesting $703,000 for start-up costs, $600,000 to expand the 
market news program to include organic news, and $1 million in 
research on the impact that market orders have on organic 
producers.
    To expand the data collection capacity of the Pesticide 
Data Program to accurately reflect the level of pesticide 
residue in drinking water, we are requesting an additional $1.1 
million.
    To conduct microbiological testing in fruits and 
vegetables, to support the Food Safety Initiative, we are 
requesting $6.2 million.
    To develop small farm, export and sustainable agriculture 
activities that will assist small farmers to increase their 
marketing opportunities, $300,000 is requested for an increase 
in the Federal and State Marketing and Improvement Program.
    And to improve the information system to support commodity 
purchase programs, we are requesting $1 million.
    Mr. Chairman, that highlights the additional requests that 
we have in our budget. I and the administrators are willing to 
accept any questions that you might have.
    [The prepared statement and biographies of Michael V. Dunn, 
Dr. Craig A. Reed, Kathleen Merrigan, James R. Baker, Enrique 
E. Figueroa, and Kenneth C. Clayton follow:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                          user fee legislation

    Mr. Skeen. Thank you, Mr. Dunn. Let's start the 
questioning.
    If you would, in your testimony, you urge Congress to enact 
the proposed user fee legislation. Has that legislation been 
submitted yet?
    Mr. Dunn. I would defer to Mr. Kaplan on that.
    Mr. Kaplan. The legislation was actually submitted last 
year. It is the same legislation. So it is up here on the Hill.
    Mr. Skeen. No retread?
    Mr. Kaplan. No retread, no, sir.
    Mr. Skeen. Thank you.

                        asian long-horned beetle

    Mr. Dunn, the administration has made a strong case for 
increased trade with China. You mentioned in your testimony the 
situation with the Asian Long-Horned Beetle which came into the 
United States in wooden packing crates from China. This insect 
is costing Federal and local government millions of dollars in 
damage to trees in New York and Illinois.
    Are the Chinese doing all they can to eliminate this 
problem? What is the status?
    Mr. Dunn. Mr. Chairman, I am very, very pleased to report 
that China has been a model trade partner in this instance on 
Asian Long-Horned Beetle and packing crates. We went to them 
with our emergency program when we introduced it because of the 
infestation that we were getting from the packing crates.
    They have exceeded 97 percent in compliance with what we 
have asked them to do. That is remarkable that they were able 
to mobilize and to be able to be so responsive to our 
regulations in such a short time.

                               screwworm

    Mr. Skeen. That is very interesting. You mentioned, too, 
the reinfestation with Screwworm.
    Mr. Dunn. Mr. Chairman, I am very sad to report that just 
recently, within the last month, we have had a number of finds 
of Screwworm in horses that are being brought into the United 
States. At our center in Miami we have found that a number of 
the horses have been infested with Screwworms. Unfortunately, 
one shipment had gone out. We are in the process of doing 
trace-back on that to ensure that there has been no 
infestation.
    We are gearing up to ensure that if we have to, we would be 
able to release sterile flies in the United States if we found 
the need to do so. But it illustrates, Mr. Chairman, the need 
to finish up our program and to talk with South America about 
them beginning, initiating a program for eradication of 
Screwworm as well.
    Mr. Skeen. I was around the headquarters in Texas when we 
started that program. It was tremendously successful. We used 
to spend most of our time in the summertime clearing up 
Screwworm problems. Surely we don't want to see it start in 
again. We are trying to move the laboratory down to Panama, so 
they can control it in both Hemispheres. I have great interest 
in keeping that exercise going for us, because it has been very 
well done.
    I was surprised that we had some infestation coming across 
the border on horses.
    Mr. Dunn. It demonstrates, Mr. Chairman, that we have to 
keep our vigilance up, that we need to find a way to finance 
that facility in Panama as well.
    Mr. Skeen. We are working on it.
    Mr. Dunn. Yes, sir.
    Mr. Skeen. Miss Kaptur.
    Miss Kaptur. Thank you, Mr. Chairman.

                          international trade

    Mr. Dunn, in your excellent testimony, you talked about the 
rising level of imports into our country and you used, what was 
the figure you used, every 6 years the volume doubles coming 
in?
    Mr. Dunn. Every 6 years, the volume of what we inspect 
doubles.
    Miss Kaptur. You are talking about agricultural imports?
    Mr. Dunn. This would be all imports that are coming in that 
our inspectors handle--the shipments that come into our 
airports and our seaports, that volume is doubling every 6 
years. We are supposed to inspect everything.
    Miss Kaptur. What percent do we actually inspect?
    Mr. Dunn. Our goal is to inspect 2 percent. Unfortunately, 
we fall short of that.
    What we are in the process of doing is conducting an 
individual risk assessment of each port to determine what the 
pathways are in that port and where pest and disease may be 
coming in. Instead of treating them as ``one size fits all,'' 
we are trying to target our resources at those particular 
ports. It is something that the Secretary and I have talked at 
great length about in recent times, and he has a great deal of 
concern about this, as do I.

                       exotic pests and diseases

    Miss Kaptur. What is the total amount that the Asian Long-
Horned Beetle has now cost the people of this country, counting 
the funds that are in your budget, the funds that the State of 
New York and the cities of New York and Chicago, et cetera--I 
am interested in looking at that.
    I am looking at Citrus Canker. You are asking for an 
increase in the budget you submitted to us. What we tend to do 
is we look at this in terms of individual outbreaks, problems. 
Can you provide for the record the total cost to the people of 
the United States for all of these various invasive species 
that are coming in here and pests that are coming in on 
imported products or animals?
    I have never seen that figure submitted by anybody at USDA. 
Are you able to put that together for us?
    Mr. Dunn. We will do that for the record, Miss Kaptur. I 
could not do it from the hip here.
    Miss Kaptur. Right. You have some numbers there perhaps on 
the cost of the Asian Long-Horned Beetle increasing?
    Mr. Dunn. The amount that we have put in, Federal side, is 
$7.3 million in fiscal 1999 and $13.6 million for fiscal 2000.
    Miss Kaptur. So it is rising?
    Mr. Dunn. Yes, ma'am.
    Miss Kaptur. What is happening with Citrus Canker? Has that 
not also been rising as I recall? That wasn't even in the 
budget a couple of years ago. Now we have that problem.
    Your budget this year proposes over $20 million, $20 to $30 
million?
    Mr. Dunn. Yes, Miss Kaptur. We are requesting $20 million 
in Citrus Canker. Two years ago, the Director of Agriculture 
for Florida, Bob Crawford, and I sat down with the industry to 
try to get our arms around the problem of Citrus Canker. We 
asked our staffs to put together a multiyear plan to address 
this particular problem that we had. They came up with a 
multiyear plan to address Citrus Canker problem.
    What we found is that that plan was not adequate, that we 
didn't have enough buffer zone around trees that were actually 
infected, and it has been exacerbated by hurricanes and other 
weather-related situations.
    So what has happened is, the State of Florida has come back 
to us and asked that we join them in doing a single year, all-
out attack on Citrus Canker to try to eradicate this. This 
unfortunately is a situation where we simply--the only tool we 
have in our tool box to address this is to remove the trees. 
This is very, very costly. Our proposal for just simply 
eradication and surveying, operating that program is $175 
million for completion. We have already spent about $44 million 
on the eradication program.
    Miss Kaptur. This counts both State and Federal money?
    Mr. Dunn. Yes, ma'am, that would be both State and Federal.
    Miss Kaptur. That is significant money. I know Congressman 
Boyd has been a leader on this subcommittee in trying to 
address that situation. I have very little time in this first 
round, or any round, but I wanted to just really urge you for 
the record, step back from any one infestation, one can list 
them. I would like to know as these imports double every 6 
years, if those are the correct numbers, what this is costing 
us inside our economy to correct the mistakes, to correct the 
problems, and we haven't even talked about some of the other 
costs that I am sure are hidden in your various budgets for 
various outbreaks that we are experiencing.
    I would really like to know what the cost, Federal cost, is 
for international trade in your budget. You probably can't 
speak to some of the other agencies, and I know it is growing 
and I don't want to get off into some sidetrack on just one 
infestation. I would like you to provide us with a summary of 
that.
    Mr. Dunn. We certainly wouldn't hide anything in our 
budget. I will get you that.
    [The information follows:]

    APHIS spent $42.1 million to combat emergency outbreaks of 
various invasive species in FY 1999, as follows (dollars in 
thousands):
        Pest/Disease:                                       Amount Spent
Asian gypsy moth..............................................      $128
Asian long horned beetle......................................     5,104
Brown tree snake..............................................       265
Citrus canker.................................................    19,710
Classical swine fever.........................................       982
European gypsy moth...........................................       490
Karnal bunt...................................................     2,433
Medfly........................................................    12,425
Olive fruit fly...............................................       429
Pink hibiscus mealybug........................................       137
                    --------------------------------------------------------------
                    ____________________________________________________

      Total, FY 1999..........................................    42,103

                            invasive species

    Mr. Dunn. There is an economist that has projected what 
invasive species cost the United States, and it is somewhere in 
the neighborhood of $123 billion annually. I will get that 
report and send it to you, because that would include forest 
and streams and everything else over and above what we do in 
Animal and Plant Health Inspection Service.
    Miss Kaptur. I know my time is up. Mr. Chairman, I would 
also ask the Under Secretary if he would be able in his reply 
to my question to also suggest other mechanisms that we might 
have available legally to place some of this cost on those who 
have actually created the difficulty, and how one might go 
about doing that--not only in this subcommittee, perhaps in 
other places in this Congress. But it seems to me that the 
importer has a lot of responsibility here, and I am very 
interested in looking upstream, how this actually got here and 
how we might move some of these costs to the perpetrators.
    Mr. Dunn. There is legislation in front of Congress, the 
Plant Protection Act, which would increase the fines for us on 
folks that we find that have smuggled in or brought in 
purposely products that pose a threat to us. I think that is 
one of the steps that we ought to take. But we will get you 
that additional information.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Miss Kaptur. Thank you very much. Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Nethercutt.

                            trade with china

    Mr. Nethercutt. Thank you, Mr. Chairman. Welcome to you 
all.
    Mr. Secretary, we now know that China is willing to buy 
about 50,000 metric tons of U.S. wheat, about 30,000 metric 
tons from my district, soft white wheat from eastern 
Washington. You and I have had conversations before about the 
T.C.K. Smut issue. We are delighted that this barrier, that I 
think is clearly a nontariff barrier, really a pretext by China 
not buying our wheat is perhaps behind us.
    Do you attribute that breakthrough to China's desire to be 
in the WTO and get permanent normal trading relations, or do 
you attribute it to the activity that your agency has 
undertaken to try to convince China that T.C.K. Smut is not a 
serious threat?
    Mr. Dunn. I think realistically, Mr. Nethercutt, I would 
have to say both. We signed--I signed an agreement--April of 
last year with the Chinese on sanitary/phytosanitary issues. We 
did not have a Chinese translation of that until we were in 
Seattle for the WTO meeting. That was signed at that time; that 
appeared to open the doors.
    There was a lot of very hard work. I give credit to our 
international service APHIS employee, Dale Mackey, who is in 
China working very closely with the Chinese to convince them of 
the concerns; and in the Grain Inspection, Packers and 
Stockyards, Mr. Baker's folks worked extremely hard on this. 
But I think there is also a desire for China to prove that they 
are going to be a responsible trading partner.
    Mr. Nethercutt. I hope they are, because it is a great 
market potentially for us in America at a time when prices are 
low and we are trying to get exports moving and move product to 
other countries. I thank you for the work that has been done, 
and all those on your staff who I know have labored on this 
over the years on this issue.

                          wolf reintroduction

    Dr. Reed, I see in your written testimony that APHIS, in 
cooperation with the Department of the Interior Fish and 
Wildlife Service is assisting livestock producers and farmers 
by managing damage caused by increased wolf activity in Wyoming 
and Idaho and Montana. Has the U.S. Department of Agriculture 
assisted the Interior Department in reintroducing wolves into 
these areas?
    Mr. Reed. We had a minor role in the actual reintroduction, 
but as they are reintroduced, we play a part in making sure 
that the predator damage is managed; and we also work with the 
Fish and Wildlife Service to track the wolves and make sure 
that they are not posing a continual threat to producers.
    Mr. Nethercutt. I am on the Interior Subcommittee, as well 
as this one. On this subcommittee, I think I speak for all of 
us on both sides of the political aisle that we are protective 
of the research dollars and the ag funds that go to help the 
agriculture economy across the country.
    Is the Department of the Interior funding its share, fair 
share, of the wolf problem; or having now reintroduced wolves 
to these areas, is USDA now stuck with the consequences and the 
cost consequences of that reintroduction?
    Mr. Reed. I don't think the Department of the Interior has 
abandoned this, but certainly we know our work is increasing. 
The wolf numbers are increasing both in the Northwest and in 
the Upper Great Lakes, and so there are more problems there 
because there are a lot of wolf pups being born every spring.
    Mr. Nethercutt. I understand that. But my question is, who 
is paying the bill by virtue of the reintroduction? Is it now 
switching over to you folks having to pay the consequences and 
the costs of this reintroduction, or is Interior funding any of 
it?
    Mr. Reed. No, both Departments share the costs.
    Mr. Nethercutt. What are the numbers?
    Mr. Reed. I will get those for you.
    Mr. Dunn. Mr. Nethercutt, we do have annually transferred 
from the Department of the Interior's budget $100,000 to our 
Wildlife Services for their share in paying for our work with 
them on predator control of the wolves.
    Mr. Nethercutt. Is that adequate? Does that cover your 
costs?
    Mr. Dunn. I would have to get back to you on what the 
actual costs are.
    Mr. Nethercutt. I would appreciate that.
    [The information follows:]

    In FY 2000, APHIS projects spending $250,000 and the FWS 
will provide $100,000 for wolf introduction work in Montana, 
Idaho, and Wyoming and $109,000 in Arizona and New Mexico. In 
FY 1999, APHIS spent $175,000 and FWS provided $100,000 for 
wolf work in Montana, Idaho and Wyoming and $109,000 in Arizona 
and New Mexico. While APHIS and FWS share in the costs, APHIS 
estimates an additional need of $1,000,000 for Montana, Idaho, 
and Wyoming and an additional need of $140,000 for Arizona and 
New Mexico for aerial support and personnel to address 
complaints.

                             pesticide data

    Mr. Nethercutt. The Pesticide Data Program is important, I 
think, to American agriculture with the implementation of the 
Food Quality Protection Act. It is unfortunate, in my mind, 
that we are using limited agriculture funds to finance a 
program that really is under the auspices of the EPA. I am just 
wanting to be sure EPA is funding its share and agriculture is 
funding its share.
    Are you satisfied with that breakdown or not?
    Ms. Merrigan. The Pesticide Data Program, as you say, sir, 
has been critical to EPA and their decision-making under the 
Food Quality Protection Act. We began this program in 1993. 
When it was first started, it wasn't necessarily seen as a 
linchpin for EPA decision-making. It has become that and it is 
one of those few programs where we have everyone from A to Z 
supporting it. We are in consultation with EPA in terms of what 
data needs they may have, but it really is a stand-alone 
program within AMS.
    Mr. Nethercutt. I would just close by saying, I am glad you 
are there to bring some reason to the models that are 
promulgated by EPA as it relates to farmers. I will close 
because my time is completed, and I thank you for your work.
    Mr. Dunn. Mr. Nethercutt, I would hasten to add that this 
information that the Agricultural Marketing Service provides on 
the Pesticide Data Program when reregistration of a pesticide 
comes up and the data is used by both sides. So it is a good, 
impartial entity that gathers that information, that everyone 
looks at.
    Mr. Nethercutt. Thank you.
    Mr. Skeen. Mr. Boyd.
    Mr. Boyd. Thank you very much, Mr. Chairman.
    Mr. Dunn and other members of the Department of Agriculture 
staff, I wanted to follow up on a statement that the chairman 
made and that is on the Screwworm issue. I was not aware of the 
information you brought us about the horses coming into Miami, 
maybe a shipment going out into the country someplace. That is 
a critical and scary thought. I know I spent a good bit of my 
youth treating calves with screwworms, summer and winter, Mr. 
Chairman. Not only has the benefit of that program been seen in 
the beef industry and other livestock--the commercial livestock 
industry, but in the South we have a more abundant population 
of wildlife, particularly deer, now than we have at any time in 
the last 50 to 100 years probably, certainly during my 
lifetime.
    A great deal of that reason is because of the eradication 
of the Screwworm. So it is imperative that we stay on top of 
that.
    But I want to shift back to an issue, a subject that Miss 
Kaptur opened, and that is Citrus Canker. It probably won't 
surprise you. I have ``licked that calf'' several times in this 
room, Mr. Dunn; with your indulgence, I would like to ``lick 
that calf'' again, as they say back home. Just to remind you 
and for the record that we first discovered Citrus Canker in 
Miami in 1995. Now today here we are almost 5 years later, 4\1/
2\ years later, and we have Citrus Canker identified and 
subsequently causing the destruction of half of our lime 
industry, which is 3,000 acres and over 3,400 acres of our 
citrus industry. And the scary part about it is, it is 
scattered throughout the State. It is in Dade and Broward, it 
is over in Collier and Hendry, and it is all the way up the 
coast to Hillsborough, and it is moving north, and I think we 
had a find in the last few days in Palm Beach County. So it is 
moving toward the Indian River area. This is a very scary 
situation for our $8.5 billion citrus industry.
    I was interested in your comments about the meeting 2 years 
ago, not 4 years ago, with Commissioner Crawford about 
developing a plan that now seems not to have worked. I 
certainly don't want to go back and rehash all that; that is 
not productive. What we have to do is go forward from where we 
are now.
    But we have had hurricanes in this country, we have them in 
Florida every year. Those things have to be taken into account. 
My question is basically, you have identified $25 million in 
your budget for Citrus Canker. But I think you said in your 
remarks that the plan that you put in place, the latest plan 
with the State and APHIS now says it is a $175 million project.
    How do we reconcile the $25 million request or $20 million 
request with a $175 million project? Are we throwing the citrus 
industry to the wolves or what are we doing here?
    Mr. Dunn. No, Mr. Boyd, what we are doing on the $175 
million is taking that plan that we put together 2 years ago 
and collapsing it from multiyears to a single year.
    But one of the things that we have recognized is that our 
overall surveillance of the State, we didn't throw a large 
enough net the first time around, and that is why as we began 
to find these moving north and south. And I think to a large 
part, in my mind, this is an emergency situation because it is 
a result of hurricanes and other natural disasters that spread 
this.
    Mr. Boyd. So are you saying that the $25 million, you have 
appropriated separately, but you still presume that you would 
use the CCC for the balance of the needed $175 million?
    Mr. Dunn. We would need--we are saying to the State, now, 
this is a draft plan, the $175 million plan. What we are saying 
to the State is, we assume that this will be a 50-50 match with 
the State, and this is what we need in addition to those moneys 
that we have appropriated this year.
    Mr. Boyd. And the Fed share would be $87.5 million of $175 
million. So we ask for $25 million in a separate budget request 
and you would secure the additional $60-plus million through 
CCC? Is that what you are saying? Because otherwise it doesn't 
reconcile.
    Mr. Dunn. It is over and above that request, Mr. Boyd. The 
actual $87.5 million.
    Mr. Boyd. We are not assuming here that we are substituting 
the budget request process for the CCC emergency procedure that 
we have used in the past; is that correct?
    Mr. Dunn. That is correct, sir.
    Mr. Boyd. Mr. Chairman, if I could continue this.
    Mr. Skeen. Go ahead. We will indulge you.
    Mr. Boyd. I really want to complete the loop here.
    Mr. Dunn, last year, last fall when we did the 2000 budget, 
we put language in there, in section 204 of Title II which says 
that notwithstanding any other provision of law, the Secretary 
shall use not more than $9 million of CCC funds for a 
cooperative program to replace commercial trees removed to 
control Citrus Canker.
    Now, we put that language in there at the request of the 
Department because the Department told us if we put the 
language that way, then we would not have to go through the 
rule-making process, and you could expedite the disbursement of 
those funds; and certainly that would have a positive effect on 
our whole eradication program, because part of the problem here 
becomes a political issue with taking farmers and homeowners' 
trees out of their yards and out of their fields, out of their 
groves.
    But here we are, 6 months down the road, and now we are 
having this discussion about who is going to do it, we have to 
wait 60, 90, 120 days for a rule-making. Can we expedite that 
in some way? Because we put that language in there at the 
request of your folks so that we could expedite the 
disbursement of this.
    It is not a complicated issue. FSA and APHIS, I think, know 
exactly which trees have been removed. FSA has a process by 
which we can get that done.
    Mr. Dunn. Mr. Boyd, what those--the language that you are 
referring to I believe was to provide for the Shade Dade 
Program.
    Mr. Boyd. No, sir, that is a separate deal. That was the $7 
million which has already been disbursed to the State and the 
State is taking care of that. This is the $9 million for the 
commercial grower replacement, tree replacement.
    Mr. Dunn. I believe, then--the rule-making process that we 
have in place right now because what we have changed is the 
perimeter from 125 feet to 1,900 feet which includes more, and 
then for the lime groves findings.
    Mr. Boyd. My question is, we put that language in there 
that way at the request of the Department so we could expedite 
the rule-making process, and now you are telling us that we 
can't do that and it is really going to cause us a problem in 
our whole eradication process because the longer you delay 
those disbursements, the more of a problem you have with the 
growers and homeowners.
    Mr. Dunn. That money that you are referring to, we did get 
that through apportionment last week from OMB. Money for 
homeowners will be transferred to the State to pay for the 
homeowners. There is still some concern about the actual 
valuation of the commercial value of the trees, and that is one 
of the things we are looking at at this time.
    Mr. Boyd. Mr. Chairman, what I would like to do, if 
possible, I would like to end this line of questioning now, but 
on the second round come back to this issue. I know there are 
some folks sitting behind Mr. Dunn and others that have a 
little more knowledge about this, but I would like to have 
answered the issue about the rule-making on the commercial 
grower tree replacement.
    The issue is, we were told last year when we put this 
language in here that this language would expedite the 
disbursement, it would require us not to have a rule; and that 
is the question I would like to have answered on the next 
round.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mrs. Emerson.

                          poultry legislation

    Mrs. Emerson. Thank you, Mr. Chairman. My first question or 
line of questioning, will go to Mr. Baker.
    It has to do with a subject we talked about last year, 
poultry and my deep concern about the increasing concentration 
and consolidation not only in poultry, which I think is the 
worst, but in all agricultural markets right now.
    In my particular district, we really have only one 
processor present, and it obviously happens across the board, 
but quite frankly this raises a lot of questions in my mind 
about fairness and fair competition in the marketplace. My 
producers have now formed their own trade association, if you 
will, called the Heartland Poultry Growers Association, simply 
so they can get together and speak with one louder voice than 
individual ones. They face a lot of challenges which I am most 
concerned about.
    Let me ask you, it is my understanding that the 
administration has endorsed Miss Kaptur's legislation, H.R. 
2829, of which I am an original cosponsor. If that is the case, 
can you all just provide to us a letter stating that the 
administration does endorse this legislation?
    Mr. Baker. I will certainly try. I don't see any reason why 
we shouldn't. We are on record as endorsing it.
    Mrs. Emerson. I believed you were, but if you could 
actually give it to us in black and white, I would feel a lot 
better about it. Could you do me a favor and explain to the 
subcommittee how this legislation does not create special 
privileges for poultry growers or the poultry industry, but it 
merely provides you all at USDA with the very same authority 
you already have over the beef and pork industries?
    Mr. Baker. We presently have administrative authority in 
the beef and poultry industry. We do not have administrative 
authority over the poultry companies.
    Mrs. Emerson. You mean beef and pork, but you don't over 
poultry?
    Mr. Baker. That's right. Any formal action that we have to 
take against a poultry company, we have to refer that action to 
the Department of Justice, which takes that action. We have the 
responsibility to investigate and try to resolve issues with 
poultry companies, but no authority, no heavy authority. It was 
never given to USDA; we have asked for it.
    Mrs. Emerson. So it would be correct to say, then, the 
poultry growers are currently today at a disadvantage relative 
to beef and pork producers; is that correct?
    Mr. Baker. That is correct.
    Mrs. Emerson. Tell me what kind of concerns y'all hear from 
poultry growers, and do you think that Miss Kaptur's and my 
bill would, in fact, help you address those concerns that you 
are hearing?
    Mr. Baker. The last question first: Yes, it would help us 
address them.
    Just recently, in the last month, we sent eight people into 
a poultry company in Mississippi; and five to interview 
growers, and three to interview management for 4 days. The 
management had canceled the contracts with 130 growers, taken 
out the fuel allowance that they had had for years, and reduced 
the value of the contract. We asked a tremendous amount of 
questions, got all the records we could from the company. When 
we left on the fourth day, this company had the best contract 
in Mississippi.
    But again, our authority was not there. Our presence was. 
And the growers were greatly, greatly appreciated that we 
responded with that magnitude to address their concerns.
    Mrs. Emerson. So obviously if you could have the same 
authority that you do with the beef and pork industry, that 
would even help the situation further?
    Mr. Baker. It is kind of like an offduty policeman. In 
other words, he is there, but you really don't know it. That 
just happened with the poultry companies. We are there, they 
don't have to recognize us. They do, and we have since 
developed a better response from the companies. Any formal 
action still has to be taken with Justice.
    Mrs. Emerson. Last year y'all requested an increase of 
$750,000 for poultry compliance activities which we approved, 
and this year you are asking for $800,000 to examine the 
competitive structure of the poultry industry. Can you tell us 
in a little bit more detail what you did with last year's funds 
and what you would do with the proposed increase this year?
    Mr. Baker. Yes. Last year we had beefed up our 
investigative response out in the districts, consolidated 
poultry activities in the Atlanta region, but did not have the 
money to staff up for the poultry work. We used that money 
basically last year to increase the staff.
    This year, most of the complaints that we hear from the 
poultry industry are complaints tied to the contracts; the 
contracts are just not adequate enough to make cash flow. Is 
there competition in the contracts? So we think we need to 
focus on the competitiveness of the contracts, and see if they 
do provide cash flow for people to make a return on their 
investment.
    We want to get into the details of the contracting with the 
people that we were able to hire last year.
    Mrs. Emerson. Mr. Chairman, let me just ask one more quick 
question then.
    If, in fact, we were to pass Miss Kaptur's and my 
legislation granting you the same authority that you have with 
beef and pork, would that require even more than the additional 
$800,000?
    Mr. Baker. We do not think so.
    Mrs. Emerson. Thank you very much.
    Mr. Baker. We do not think so. The money that we have would 
be adequate. The authority is what we need.
    Mrs. Emerson. Thank you very much.

                       mandatory price reporting

    Mr. Skeen. While we are at this stage, let me address this 
to Administrator Merrigan. I understand that the proposed rule 
on mandatory price reporting is scheduled to be published in 
the Federal Register on March 17. And it is now available on 
your website. I want to commend you for the rate at which you 
were able to put the rule together.
    How long is the comment period open and when do you expect 
to publish a final rule?
    Ms. Merrigan. The comment period, as stipulated by the 
statute, would be 30 days long. When we go to a final rule and 
actually implement will be sometime this summer. The statute, 
as you know, sir, had a very aggressive timetable for AMS to 
follow to get this program up and running. By my estimate, we 
are about 6 weeks behind.
    Mr. Skeen. It is aggressive.
    Ms. Merrigan. We are really struggling to meet the 
deadlines. We will have a program up and running. I know people 
are anxious for it. It will be up this summer.
    Mr. Skeen. You have done it very well, especially in the 
time you have had to get acquainted and put it into use. We 
appreciate it.
    Ms. Merrigan. Thank you.
    Mr. Skeen. Miss Kaptur.

                         local producer outlets

    Miss Kaptur. Mr. Chairman, I wanted to ask several of our 
guests this morning, in northwest Ohio, where I live, the only 
place you can buy poultry raised by local growers, retail, is 
at the local farmers market in a little poultry shed which is 
inspected by our city; and I buy my chicken there. At any other 
store in our region--and there are several chains that 
operate--you cannot purchase locally grown chicken. This is 
troubling to me.
    The same is true with eggs. The only place you can now buy 
eggs in our region produced by local growers is at a few of the 
independently owned vegetable markets that operate in our area.
    About 2 years ago, when our hog producers were getting 
about 9 cents a pound for pork, I went to the store and I 
looked at the prices and they hadn't gone down in the retail 
chain. If we have price elasticity in food production, why 
wasn't it reflected on the shelf?
    The question I have to all of you or any one of you would 
be, what is happening in our country?
    Secretary Dunn, you talked about concentration and 
consolidation, that our local producers can't get on the shelf, 
and that in fact whoever is controlling price in this country 
in food purchases at the local retail store doesn't respond to 
the marketplace. But in fact when the price of something like 
pork goes down to the producer, it doesn't go down in the 
store.
    What is happening?
    Mr. Dunn. The question on inspection of the local processor 
is something that food safety inspection service would handle 
which is under Under Secretary Woteki's jurisdiction. We have 
been asked to look at the retail side, especially since last 
year, last December, when pork prices had dropped to $8 a 
hundredweight, and many people did not see prices come down on 
the retail side. That is something we have talked to Economic 
Research Service ERS about.
    Miss Kaptur. Do you have the funds to do that now? Can you 
give us a report on why prices didn't drop in these retail 
stores?
    Mr. Dunn. I do not have anything in Marketing and 
Regulatory Programs that would address the retail sector. That 
would be under the Federal Trade Commission's jurisdiction.
    I might add that I had an opportunity to visit that shop 
that you mentioned. And was very impressed with what they were 
doing.
    Miss Kaptur. I am sure they are inspected by the State, and 
I don't know by how many people. But the point is it is the 
only place you can buy locally grown products from our 
producers. So my question really goes to the heart, if we have 
these producers that are really trying to survive in this 
economy, why can't they get on the local shelf? And I know that 
our community is not the only one where that is happening. Does 
anybody at USDA care about this?
    Ms. Merrigan. Let me, from the Agricultural Marketing 
Service, speak to your question, your concern briefly. I mean, 
there are institutional barriers, as you know. You, along with 
the other committee members, have asked the Agricultural 
Marketing Service and we are working in cooperation with the 
Economic Research Service to look at slotting fees as an 
institutional barrier.
    But one of the other things I find is, a lot of the small 
farmers that I work with are really great on production 
management systems. They are not always so great on marketing.
    One of the things that we try to do at AMS through the 
Federal/State Marketing Improvement Program, through the 
partnership with the SARE program, on small grants for direct 
marketing for farmers that the committee provided to us, and 
through our wholesale market development program, is to find 
ways to get that farmer into the market, to get his or her 
product to local markets.
    The other thing I will tell you about is, we really need to 
think more about the consumer end. You clearly are a consumer 
who cares about buying locally. Where I am from in western 
Massachusetts, they have a whole campaign called ``Be a Local 
Hero.'' The local supermarkets are actually behind it. They are 
stocking more locally grown items. They have T-shirts and 
campaigns, and it really is starting to work the consumer-
demand side that we don't see across the country.
    One of the things we are trying to do in AMS is look at 
these little experiments, where these things are happening, and 
try to replicate them and share that intelligence from farmer 
to farmer.
    Miss Kaptur. Mr. Chairman, I just want to say with what is 
going on in rural America today--and maybe I just haven't read 
this testimony from all the witnesses this morning completely, 
I don't sense an urgency of USDA, trying to meet the real 
crisis that is out there, in the budget proposals that have 
come before us to try to help these farmers. I am talking about 
small and independent farmers. How, medium-size producers gain 
a foothold in this marketplace. There is too much of a 
business-as-usual attitude.
    Maybe I am not reading your budget submission completely, 
maybe I am misunderstanding something, but I would like to see 
more focus on how this year there is nothing in the 
supplemental. We are just providing AMTA payments to hold the 
whole structure up right now. But in terms of really dealing 
with the small and medium-size farmers that are out there, I 
don't see in this budget efforts to--you think that it is a 
good idea in western Massachusetts--then to expand it to many 
other places, to really work to move product to farmers 
markets, if that is the only option we have got left in the 
country in many places.
    I just don't sense the urgency in where the pressure really 
is, on helping the small and medium-size producer, because the 
big folks are doing okay with the AMTA payments. But it is the 
small and medium-size producers, that aren't row crop, that are 
really having trouble; and I am really troubled by what I see 
as a lack of commitment by USDA and what it has presented to us 
thus far.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Bonilla.
    Mr. Bonilla. Thank you, Mr. Chairman. I would like to start 
with the request, the budget request, for the Boll Weevil 
Eradication Program. There was a request in my understanding of 
2.8 million and that would eliminate any cost share for the 8.5 
million acres either currently in the program or about to enter 
the program.
    This being an especially tough time economically for a lot 
of our producers out there, it seems that this would, in 
essence, be pulling the rug out from under a very successful 
program. I hope that the Department sees fit to change its 
position.
    How do you see this?
    Mr. Dunn. Mr. Bonilla, the last couple of years what the 
Department has done is look at the Boll Weevil Eradication 
Program, and it is very I successful, and it is one that the 
Department does support. However, given the limited budget 
authorities that we do have at USDA, we have worked with the 
farm service agencies to ensure that they have the authority to 
provide loans for producers to take part and provide a buy-in 
by the producers for the Boll Weevil Eradication Program. That 
has been part of the budget submission.
    Mr. Bonilla. Is that, in essence, going to replace what the 
Boll Weevil line item would have provided if it had more money?
    Mr. Dunn. Historically, Congressman, what has happened is 
that the committee, in its wisdom, has found some way to 
replace the funds that we have said would be loans.
    Mr. Bonilla. I am sorry, I don't quite understand.
    Mr. Dunn. Traditionally, what has happened the last couple 
of years is that where we have proposed that this be a loan 
program through the Farm Service Agency, the committee has 
found a way to actually find funds to fund it 100 percent.

                               FERAL HOGS

    Mr. Bonilla. This is something that a lot of us on this 
committee are concerned about, so we are going to keep trying 
to address this problem because we see it as very--again, as 
you agreed, successful program that we want to make sure that 
our producers can take advantage of.
    I want to move now to a question about something that may 
be unique to our part of the country down in the Southwest, 
along the Texas-Mexico border, and that is the feral hog 
problem in Texas. It is amazing the growth of the hog 
population down there that is now threatening--it is expected 
to pass the white tail deer population--and all of the farmers 
and ranchers down there see them as a--they are kind of fun for 
hunters to chase once in a while, but they are--also, the 
overriding factor is a concern for property destruction. They 
are just creating havoc on a lot of the farms and ranches down 
there.
    Is there any plan to help some of these producers down 
there with this invasion of feral hogs?
    Mr. Reed. We are working with the State of Texas on the 
feral hog population. Unfortunately, hog populations are 
increasing in the wild, just like they are in captivity, and we 
don't see a slowdown in their numbers. But we are helping the 
State of Texas.
    We know they cause considerable damage. Even with hunts and 
the hunt clubs killing some animals, we have got growing 
numbers of hogs, not just in Texas, but Louisiana, Florida, 
Tennessee, and Alabama, too.
    Mr. Bonilla. There has been, if anything, an acceleration 
in the number of hogs that we have down there. We would be 
interested in working with you all on that. Some of the farmers 
and ranchers down there just don't know what to do anymore. 
They are just flooding the place.

              wildlife services operation budget reduction

    I will move now to a question about imported lamb. Last 
year the President signed a trade agreement that said--set 
limits on imported lamb. It was a very appropriate decision 
that we were glad that he saw the need to make. But on the 
other side, for the sheep and goat producers down there, they 
are concerned because the budget request this year recommends a 
$2.7 million reduction to the Wildlife Services Program. I 
understand Wildlife Services isn't directly connected to trade. 
However, on one end we are helping them and on the other end we 
are hurting them on a program in a reduction that is very 
significant to their ability to meet the needs of these 
difficult markets right now.
    Can you tell us what the thinking is there, helping on one 
end and hurting on the other?
    Mr. Reed. Let me talk about the Wildlife Services side of 
it rather than the trade side.
    We know that there was a reduction in Wildlife Services 
budget request for FY 2001. We haven't had to make reductions 
yet, but we are looking down the road this year to the 
operational budget being reduced, probably across the board. We 
see that as serious.
    We also had a rescission in the Wildlife Services budget in 
FY 2000. We were directed to make the reduction. It puts us in 
a box.
    Mr. Bonilla. So you would agree that this is not enough, 
this $2.7 million? I mean, the reduction does not provide 
enough of what we really need out there for Wildlife Services?
    Mr. Reed. We wouldn't have asked for it if we didn't need 
it.
    Mr. Bonilla. Again, this is an area that we hope to provide 
a higher number on, because I think we are in agreement that 
the line item request now is inadequate.
    Do I have remaining time, Mr. Chairman, or am I out of 
time?
    Mr. Skeen. We will indulge you for about a minute.
    Mr. Bonilla. Thank you.

                             pork checkoff

    I want to move now--the Secretary recently announced that 
the USDA will hold a referendum on the pork checkoff program. I 
was wondering what the plan is to pay for this, especially in 
light of the fact that the Secretary said the Department did 
not have the money needed to pay for implementation of 
mandatory price reporting.
    Ms. Merrigan. The cost in the first year of mandatory price 
reporting, our estimate is $4.7 million, which the committee 
was very kind to provide to the Ag Marketing Service. Our 
estimate of what it will cost to conduct a referendum in the 
pork checkoff--it is not a final estimate yet because we are 
going to have a proposed rule on the referendum procedure; 
which will have a 60-day comment period, hopefully that will be 
published sometime soon--but our expectation is that that will 
be about $125,000. I have checked with the Office of General 
Counsel, and they have indicated to me that we would be able to 
take that money from section 32 administrative funds, that 
there is that flexibility there.

                              cattle ticks

    Mr. Bonilla. Very good. And the last question I have on a 
different subject, covering a lot of territory here this 
morning, is the Cattle Tick Program, which a lot of my 
colleagues probably don't even know what is involved, because 
it is unique to our area, or primarily to my area down there.
    Tick fever costs about $5 billion a year in death losses. 
During the past year the first case of tick fever in 24 years 
was detected in Zapata County. Last year the program received a 
very small increase in funding. It is a program that I have 
been talking about for a couple of years now.
    Can you tell us how this money has been spent?
    Mr. Reed. We went down and visited with the tick riders in 
Laredo this past year with your staff. We are doing a number of 
things. We were able to provide pay increases rather than fill 
vacancies. The tick program is one of the most effective ways 
to control cattle ticks coming across the border; it is not 
getting any cheaper to do it but it is still effective. Ticks 
in Texas and Arizona on cattle are not the only problems we 
have. Ticks on other species are equally as important. We like 
the tick program, have supported it, and are trying to find 
ways to help the inspectors improve their grade status. We are 
behind it.
    Mr. Bonilla. Just a final comment, Doctor--not a question, 
Mr. Chairman, but I want to thank you for the attention you 
have given to this program down there. It is very important. I 
know you have worked very closely with my staff on it; I hope 
you keep doing that. Thank you very much.
    Thank you.
    Mr. Skeen. Mr. Farr.

                             animal welfare

    Mr. Farr. Thank you very much, Mr. Chairman. I have several 
questions, and I will try to get through them.
    The first is related to Animal Care. Can you tell me how 
the Department's enforcement of the Animal Welfare Act has been 
affected by the budget shortfalls in the Animal Care Division 
over the past decade? Just briefly outline for us what the 
problem has been.
    Mr. Reed. Yes, Congressman, I can give you a pretty direct 
response to that.
    We have had basically a flat budget for animal care 
activities since 1991. Back then we were performing about 
17,000 inspections a year of licensed dealers and exhibitors. 
With that flat budget, we have had both an attrition of staff 
and an inability to perform the travel required so we are down 
to less than 10,000 inspections a year. The increased money 
that is in the budget will help to get us closer to the '91-'92 
inspection levels.
    Mr. Farr. I am glad to see--what was it a $5 million 
increase this year by the President?
    Mr. Reed. Yes.
    Mr. Farr. What improvements in the inspection program do 
you think will be possible with the $5 million? Will you get 
back to the 17,000?
    Mr. Reed. We will not get back to 17,000 initially, but we 
will be able to conduct much-needed training of our inspectors 
in the field, so they apply regulations more uniformly.
    The inspection business is more complicated today than it 
was in 1992, especially when you consider the new technology in 
biomedical research and the complexity of the research 
regulations.
    We will be able to hire a number of new inspectors. We will 
acquire equipment, cars, and have gas so they can perform 
necessary inspections.
    Mr. Farr. Has this shortfall affected the Department's 
ability to serve what is called the needs of the ``regulated 
community,'' the community such as zoos and laboratories, 
airlines?
    Mr. Reed. They support the increase and have aligned 
themselves with animal groups to support the increase. They 
want better service.
    Mr. Farr. Is it effective? Have you cut down on your 
service to the regulated community?
    Mr. Reed. We prioritize our inspections and go to the 
places where we think there are the biggest problems. We have 
performed fewer inspections. Those inspections include research 
facility requested inspections to establish their compliance 
status.
    Mr. Farr. So with the increased budget amount, you are 
going to be able to improve those services?
    Mr. Reed. Yes.

                            pierce's disease

    Mr. Farr. The committee reported a supplemental 
appropriations that contained $7.14 million for Pierce's 
Disease. I wanted to thank you for that.
    I am concerned about the way evaporation occurs in this 
funding. What I mean is, by the time the funding would reach 
the field level, the dollar amount could be anywhere from 15 to 
25 percent lower than what has been appropriated. I wondered 
what the agency's level of overhead amount will be, taken out 
of the $7.14 million that was appropriated, what the program 
level overhead amount will be taken out of these funds; and 
when the funds reach the regional office, is more taken out to 
support the regional office?
    What is your estimate of the $7.14 million funding level 
that will actually reach the field?
    Mr. Reed. I would have to get the exact breakdown for you. 
There is going to be a reduction for overhead. We have risk 
assessors, experts that are world-renowned people on Pierce's 
Disease. These folks have to be supported with a portion of 
that money.
    Mr. Farr. I think the frustration is when we get some 
research money appropriated to a crisis like that, just by 
trickle-down effect is the very problem you are trying to 
solve, everybody has put in their administrative claim on it 
and very little money hits the ground.
    What is the use of appropriating it if that is going to 
happen?
    Mr. Reed. We know that at least 85 percent reaches the 
field. We build support costs into the request. We know ahead 
of time that support activities become involved with these 
activities so must be included in the estimate.
    Mr. Farr. So you are claiming that of the $7.14 million, 85 
percent of that money, only 15 percent overhead for all levels 
of government that are involved with that?
    Mr. Reed. Yes.
    Mr. Farr. Total, not 15 percent each?
    Mr. Reed. No, it is not additive along the way.
    Mr. Farr. I will come back to that. Thank you.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Latham.
    Mr. Latham. Thank you, Mr. Chairman.

                       mandatory price reporting

    Welcome, everyone. Last year I made sure the price 
reporting was part of our appropriations bill and last year 
requested $6 million. I guess I have several questions.
    You are assuring us that that funding level is adequate. I 
would like to know how you arrived at the number. And because 
the responsibilities are broken up between the Food Safety 
Inspection Service and the Economic Research Service and the 
FAS, can you tell us where the breakdown is on those dollars, 
what agency, how much they get?
    Ms. Merrigan. The budget request for AMS of $5.9 million 
only covers the responsibilities that the Ag Marketing Service 
has. So as you point out, there are many agencies within USDA 
that have pieces of responsibility under the statute, the 
lion's share, though, being AMS. Of the $5.9 million--and we 
will provide you a detailed breakdown--a little over $3 million 
of that is staff.
    We have to hire a lot of auditors to run this program, to 
double-check that the information that we are receiving is 
accurate. We also have to purchase some hardware, some 
software. There is some travel in it.
    But we have a detailed breakdown on the $5.9 million. We 
feel very confident that that is a good figure.
    Mr. Latham. So the other agencies, then, will have it come 
out of their regular budget? Are there provisions? The budget 
will be adequate?
    Mr. Dunn. Mr. Latham, you will notice in the GIPSA request, 
there was $400,000 in there for their portion of the swine 
contract library in there. It would be my assumption that each 
of those agencies that are responsible for a portion of that 
would make similar requests, and I would have to defer to Mr. 
Kaplan as to what the other entities have done at USDA.
    Mr. Kaplan. There is an additional $500,000 in the NAAS 
budget for this item. For FAS and the other agencies you 
mentioned, this comes out of their base. There are no specific 
increases in their budgets.
    Mr. Latham. I just want to make sure that we don't come 
back and say, oops, we ran out of money and we can't do it. I 
am not sure my producers would appreciate that.

                              pseudorabies

    Dr. Reed, your agency is working to eliminate pseudorabies. 
I have a major problem in several of my counties, very large 
outbreaks. It concerns me a great deal to see you reducing the 
budget, the funding by, what, $524,000.
    First of all, give us an update on how you are doing in 
this very serious problem, and how you can justify a budget 
decrease with the huge problem we have.
    Mr. Reed. We have shifted $500,000 from the pseudorabies 
program to the monitoring program to look at herds in counties 
to determine disease status. You have to know the disease 
status in all herds in an area to make sure that you are 
eliminating all of the disease.
    Second, we have made considerable progress on pseudorabies 
eradication. We started with over 1,100 infected herds a couple 
of years ago and now we are down to 400 herds. During this 
effort, we had a significant outbreak both in your State and in 
Minnesota that we addressed along the way. So we would have had 
a lot more problems without all of that.
    We can get you specific numbers on herds, dollars, et 
cetera, if that is what you would like.
    Mr. Latham. You are reducing monitoring. It would almost 
seem like, if you reduce that, you are saying, well, we are not 
going to find out about as many cases, so we don't have as big 
a problem. I don't quite understand.
    Mr. Reed. The monitoring is part of the pseudorabies 
effort. There were millions of dollars in direct payments that 
went to producers, but we have to keep monitoring the States to 
determine disease status.
    Mr. Latham. So what you are doing is taking money out of 
that; if I understood your answer, you are decreasing $524,000. 
But you said you are moving money out of monitoring; is that 
correct?
    Mr. Reed. The $500,000 has shifted from the pseudorabies 
program to the monitoring program. I may have misspoken 
earlier.
    Mr. Dunn. Mr. Latham, if I might, 2 years ago we did get 
$80 million for our pseudorabies program and another $40 
million last year to do that. We thought that we were well on 
the road to eradication. I think in Iowa, in particular, which 
is also my home State, the exceedingly warm weather has really 
exacerbated the problem. The fact of the matter is that we had 
not planned for this additional outbreak when we had prepared 
the budget, so we will take another look at this as you are 
suggesting.
    Mr. Latham. I would just, in closing--Go, Cyclones, this 
week at the NCAAs.
    Thank you, Mr. Chairman.
    Mr. Skeen. You are always wishing.
    Mr. Latham. Come on. We are there, man.
    Mr. Skeen. Mr. Boyd.
    Mr. Boyd. Thank you, Mr. Chairman.
    Secretary Dunn, I wanted to say, first of all, that you and 
your people have been very helpful and cooperative as we have 
tried to work through this crisis. I sensed an uneasiness about 
maybe the tone of my question, and I want to make sure that 
that wasn't mistaken.
    If there is an urgency in my tone, it is because, in 
Florida, we are deathly afraid of losing our $8.5 billion 
industry. Unlike the 1980s, when we contained the Citrus Canker 
to the nurseries, this has now spread into producing groves all 
over the State. That is the reason for the urgency in my tone, 
I guess. I just wanted to say that to you, Secretary Dunn.
    Do we have an answer about the commercial tree replacement 
at this time, or is it something you need to get back with me 
on, the rule-making and why we have to do that, given the 
language?
    Mr. Dunn. I have been given an answer, Mr. Boyd, but I 
think we might muddy the waters more than we would clear them, 
so if you would allow us to get back to you in writing on that, 
I would appreciate that.
    Mr. Boyd. The last thing we want to do at this hearing is 
muddy the water more.
    I want you to know that this whole issue of invasive pests 
is one that we all realize is a product of increased trade, 
increased tourism. I think you have cited the numbers yourself. 
There are many of us who support the efforts; I am a sponsor of 
the Canady legislation which will give you more tools to do 
your job, and you have allies on this committee who would help 
you get more resources to do your job. We want you to know 
that, because it is a little bit disappointing when we cite the 
problem annually, year after year, we don't ask for resources 
to deal with the problem.
    I know these are not necessarily your decisions, but I want 
you to know that you do have allies here to help fight this. We 
recognize what your burdens are there.
    I think the only other thing I want to say, if you are 
going to get back with me on the question, is the issue of the 
use of CCC funds; and there are some members of this committee 
that feel like there might be an attempt from somewhere up 
above, OMB or somebody, to replace the authority we have to 
deal with emergencies out of CCC by cracking into this 
committee's discretionary budget. I think I have your 
assurance--I know I certainly have the assurance of the 
Secretary--that that is not the case; and I think that is what 
you told me earlier, that you only asked for $20.5 million to 
deal with this issue, but you know that CCC is available if we 
have to go beyond that.
    Mr. Dunn. Yes, sir, we fully intend to go to CCC for 
funding of this new, combined, 1-year program.
    Mr. Boyd. Thank you very much. I look forward to the answer 
on the $9 million commercial tree replacement program.
    [The information follows:]

    In the case of the Shade Dade program for noncommercial 
trees, the State already had a voucher program in place that 
can provide a basis for distributing the $7 million provided in 
the supplemental. However, in the case of the $9 million 
provided in the supplemental for commercial trees, neither the 
State nor APHIS have a program in place to pay tree replacement 
costs, so it is incumbent upon us to develop a formula for 
determining who should receive compensation and how much they 
should receive. Beause there are many potential recipients of 
the money and many potential formulas for setting the amount we 
might pay, we must go through the rulemaking process to ensure 
that interested parties have a chance to comment and that we 
make the payments on a consistent and fair basis.
    We understand your concern with the delay in getting 
payments to farmers who have suffered losses. Although we must 
use rulemaking, we will expedite the process and give this rule 
our highest priority.

    Mr. Skeen. Mrs. Emerson.
    Mrs. Emerson. Mr. Under Secretary, or any of you all who 
want to answer this question, or everyone. This has to do with 
invasive species.
    The fact is that I am hearing almost as much as I have 
about telephone taxes from my farmers and ranchers about the 
President's executive order on invasive species and what you 
all are doing to support that. A lot of my producers believe 
that that executive order would limit their ability to use 
longstanding and legitimate agricultural products, and 
specifically--some of my livestock producers have said that 
some of the grasses they use for forage could be considered 
alien under the conditions that the executive order may 
establish.
    We have another problem that kind of relates to this, and 
that has to do with the whole issue of reintroduction of elk by 
our Missouri Department of Conservation, because they are 
considered a native species, if you will, and we are going to 
perhaps have, as a result of that, a lot of damage to crops and 
other livestock. The combination of these two things has got so 
many of my people absolutely up in arms.
    Obviously, while I applaud the general idea of the 
executive order, I am a little bit troubled that some of these 
same situations could occur once it is totally promulgated. 
Tell me what y'all are doing to address those concerns, if you 
will.
    Mr. Dunn. Mrs. Emerson, first of all, let me commend you on 
your efforts at reinstituting the Rural Caucus. That is 
something that we in the Department look forward to, and I 
think is going to be a tremendous help for us in rural America 
as well.
    Mrs. Emerson. Thank you. I hope so.
    Mr. Dunn. The Secretary chairs, along with the Secretary of 
Commerce and the Secretary of Interior, the effort on the 
executive order for invasive species. Animal and Plant Health 
Inspection Service has been asked to take the lead as far as 
the Department of Agriculture in this arena. What we are trying 
to do is to combine the efforts of eight different departments, 
over 22 different agencies, to ensure that we are all focusing 
in the same way to identify the problems as early as possible, 
to take the steps that we need to eradicate those problems or 
reverse what we are doing now.
    With the loss already of 100 million acres and another 3 
million acres a year, there is a great deal of concern. Two 
weeks ago, I chaired a panel in which we had members from the 
National Cattlemen Beef Association, from the seed association 
along with the garden club and the national conservation groups 
and the Secretary of Agriculture from California. I anticipated 
that there would be a lot of upheaval, that these folks would 
disagree on things.
    What I found was that they agreed on more things than they 
disagreed. I think that is the spirit that we have got to go 
forward in implementing this executive order. We simply cannot 
use up 3 million acres a year of our countryside.
    Once we--there are a lot of concerns about developing lists 
and who should be on the advisory committee; we expanded that 
advisory committee from 25 members to 32 members to ensure that 
we had all the voices on there. I am guardedly optimistic that 
what we come up with will be positive and good for all sectors.
    Mrs. Emerson. Do you suppose that in developing the list of 
those species which are--you have a look on your face, but, 
anyway.
    Mr. Dunn. There is a lot of concern about developing the 
list. I don't know that anybody is going to go out and say, all 
right, here is the list, because one person's poison is 
another's cocktail.
    Mrs. Emerson. I guess if you don't develop some sort of 
criteria, if you will, for what is alien and what is native, 
then how in fact will this executive order work?
    Mr. Dunn. What we are looking at are things--kudzu, for 
instance, that everybody can agree is a problem, no matter 
where you sit. Those are the types of things that we need to 
attack, that we need to be able to muster all the resources, 
not just the Federal Government, but State and local government 
and Indian reservations as well.
    So we are not in there without partners. We have a lot of 
partners in there and everybody is going to be heard.
    Mrs. Emerson. So that my producers can feel good about the 
fact, I can go back and tell them that they have a seat at the 
table, and that perhaps something as economically indispensable 
as fescue may not be considered alien?
    Mr. Dunn. That would be my hope.
    Mrs. Emerson. And mine, too. Thank you.
    Mr. Skeen. Mr. Farr.
    Mr. Farr. Thank you, Mr. Chairman. Mr. Reed, so in 
continuing that discussion on the Pierce's appropriation of 
$7.14 million, how much of that will reach California?
    Mr. Reed. I didn't do the math.
    Mr. Farr. You said only 15 percent would be taken off by 
all the administrative agencies, so that would be $6.069. So we 
can quote you?
    Mr. Reed. Yes.

                              organic rule

    Mr. Farr. Let me move to another issue, organic rule. I 
authored the first legislation in the Nation when I was a state 
legislator in California, creating the California Organic Act 
which was the model for the Federal act in 1990.
    Under our act in the State of California, we have a label 
that you can put on, saying ``certified organic,'' and then it 
quotes the law, the ``certified organic'' by the 1990 organic 
act, California Organic Act.
    In the rules you have adopted, is it going to allow the 
States to continue to have--their requirements are tougher than 
the Federal requirements; and I understand in the rule you have 
just adopted, you kind of changed it. You added that States' 
requirements only be to unique environmental conditions with 
specific production or handling practices particular to the 
State or portion of the State.
    Does that interpretation mean that California cannot 
continue to use the ``certified organic'' label?
    Mr. Reed. I need to pass this to Kathleen.
    Ms. Merrigan. Let me just say that Secretary Glickman was 
sorry you were unable to join him at the press conference.
    Mr. Farr. So was I.
    Ms. Merrigan. We had to accelerate our schedule.
    Mr. Farr. He scheduled it on election day in California.
    Ms. Merrigan. We realize that was unfortunate. It was 
because the press broke the story before we broke the story.
    In terms of what a State is allowed to do under this 
proposed rule, it is pretty much guided by the statute that 
Congress passed in 1990. That is, a State can have standards 
beyond the Federal standards, but they may not discriminate on 
products coming in from other States, and they cannot assert 
that their organic product is greater or better than another 
State's product, and for that program that the State would 
have, those organic standards would have to be approved by the 
Secretary of Agriculture.
    The proposed rule, as you say, sets out certain criteria 
that a State program would assert as a reason to have an 
additional standard beyond the Federal standard. An example I 
always use is, if you have a sensitive aquifer that needs 
protection beyond which would make sense at a Federal level, 
that really is needed in a State or a region of a State, 
additional standards might be proposed for that.
    Mr. Farr. So you will be able to have products on the 
shelves that say ``organic,'' but they are not certified State 
organic, so you are going to have a competition in labeling 
here between Federal labels and State labels?
    Ms. Merrigan. No.
    Basically, the main job of USDA, when this program goes 
into place, is to accredit certifying agents, the existing body 
of private and State certifying agents that are out there, who 
will still be able to use their own seals. So, for example, in 
your own State, CCOF, which has a seal, will be able to 
continue to use that seal if they are the certifying agent.
    Mr. Farr. Right now, they are the only ones on the shelves 
in California?
    Ms. Merrigan. No. You have product in California certified 
by a lot of different certifying agents--Oregon Till, OCIA--
there are no restrictions that I am aware of of product coming 
into your State that is certified by other States.
    Mr. Farr. The bottom line of the new rule is that it is not 
going to affect the existing labeling practices in California?
    Ms. Merrigan. My understanding of the proposed rule is that 
it meets at least all of the requirements that are currently in 
place in California. So there should not be any major 
difference felt in the State of California other than that 
certification will become mandatory.
    Now it is optional. It will become mandatory.
    Mr. Farr. I like that.

                       glassy-winged sharpshooter

    Lastly, the Glassy-Winged Sharpshooter is a huge problem in 
California. You know that. The question is, I am hearing more 
about this than any other exotic pest I have ever heard of, but 
I am also hearing that there is a concern that APHIS isn't 
really treating this much differently from any other pest and 
that there is some concern that since this is not of 
international origin, that we don't pay as much attention to it 
and that, therefore, because it is not of international--not of 
foreign origin, it doesn't get the attention because it is not 
a Federal action pest. Is that true?
    Mr. Dunn. I think that because the Glassy-Winged 
Sharpshooter is a vector for Pierce's Disease, we are treating 
this very, very seriously. In fact, I went out to Riverside and 
gave them $360,000 to help, which I thought was fantastic. I 
observed the city, the county and the State all pitching in to 
fight this problem, because they realize what an impact that 
would have on the local economy. It is something that is 
indigenous to the southeastern part of the United States; it is 
not something that has been indigenous to California.
    We are going to treat this as a serious pest, yes, sir.
    Mr. Farr. You don't treat it differently because it is a 
domestic pest rather than a foreign pest?
    Mr. Dunn. When you look at our regionalization standards, 
there are things that are in some regions of the United States 
that are not in other regions of the United States. What we try 
to do is ensure where we have something that is not indigenous 
to an area, we don't let it get in there. That is, of course, 
why California has all of their folks at the border stopping to 
check, to make sure that produce doesn't come in from other 
parts of the nation.
    Mr. Farr. Is that compensated by the Federal Government or 
is that all State-paid-for?
    Mr. Dunn. It is all-State, that program is a State program, 
but we have a similar program of keeping other things out 
nationwide. We have quarantines that we provide.
    Mr. Farr. That is what I am trying to get to, Mr. Chairman. 
We all--on this subcommittee, we all have sort of our own 
problems, pests that are in our areas, in our districts or our 
States that are not in other districts or States. Yet there is 
the same problem that Mr. Boyd talked about, the same reasons 
for transporting these pests that you don't want to be in your 
State.
    I think that there is a growing concern, and perhaps we 
just need a better education on what the Department does to try 
to contain these problems within the area where they occur so 
that they won't be spread either internally in the United 
States or into this country from outside. Perhaps we just need 
a better briefing on, if there is any difference between the 
two, between foreign and domestic, then what the program is to 
contain them within their region.

                         regulatory activities

    Mr. Reed. We have Federal and State quarantines to prevent 
movement in and out of certain States. We look at the 
Sharpshooter problem in California as an invasive problem, even 
though it didn't come from another country, we are working with 
the States on these problems. If we need to set up a 
quarantine, we will.
    Somebody asked earlier about progress on the Boll Weevil; 
we may get to the point where we need to establish a national 
quarantine on boll weevil. If we do that, it is going to cost 
money to enforce it. You can't just have it and just walk away. 
We consider it serious. That is why the National Plant Board 
and all of us work together with State departments of 
agriculture to make sure if a State has got a reason to keep 
product out of another State, we are going to help make sure 
that it works.
    Mr. Dunn. Mr. Farr, let me make another point, because 
there are some similarities here of the other diseases that we 
have talked about.
    This disease, Pierce's Disease, that the Glassy-Winged 
Sharpshooter is a vector for Plum Pox Virus that we have in 
Pennsylvania, Citrus Canker that we have in Florida; all these 
are viruses that right now we don't have any tool in our bag to 
fight. What we need is a Manhattan Project approach, to going 
in and looking at these viruses. Can we come up with an 
inoculation; is there something that we can do short of 
removing the trees and incinerating them. That's where we are.
    Frankly, we and ARS and others have been doing these things 
piecemeal. What the Secretary and I have been talking about is 
bringing all of this together and taking a look at what it is, 
and going after it with all of our resources, to come up with 
answers that address these problems. We have got to start 
thinking outside of the box that we are in right now.
    Mr. Farr. In closing, the State of California and 
Chancellor Orbach at Riverside has proposed to the State that 
they build a center for exotic disease--for exotic pests 
research, the Manhattan Project that you are talking about. 
They are asking for some Federal support, and the members of 
this committee are supporting that. I hope you are aware of 
that effort in southern California.
    Mr. Skeen. Miss Kaptur.
    Miss Kaptur. Thank you, Mr. Chairman.
    In my final round of questioning, whenever that comes, I am 
going to ask each of you to tell me for the record what steps 
you are taking administratively this year, or incorporated in 
this budget proposal for next year's budget, that are directly 
aimed at small and medium-size farmers and the crisis that they 
are facing across this country. But I will let you think about 
that for a minute.

                       chiapas screwworm facility

    Dr. Reed, you talked in your testimony about the 
effectiveness of the Screwworm Eradication Program. Last year 
when you all were before this committee, I asked the question I 
have asked of the Secretary and of others in the Department 
about the Screwworm facility that exists in Chiapas. We talked 
last year about how that might be converted, working with other 
parts of USDA to a facility that would employ people in 
agriculture down there producing something that would be 
appropriate to that environment. I remember Mr. Figueroa had 
talked about pineapples, coffee, tropical fruits that wouldn't 
necessarily conflict with something we grow in this country.
    Could you tell me, has anything been done inside the 
Department to try to reposition agricultural activity out 
there? I know that many hundreds of people are unemployed now 
who had worked in that particular facility.
    Mr. Reed. We have a meeting with the Mexicans the week of 
March 26 to discuss how we can help. The reason it was delayed 
to the week of March 26, 2000, instead of March 26, 1999, is 
because we don't have financing for the plant in Panama, so 
construction has not started. We know it is a little ways off, 
but we feel the need to have a meaningful conversation with the 
folks in Chiapas to decide on the future use of that facility. 
We are open to everything.
    Of course, whether it is agriculture or whether it is 
nonagriculture, the Mexicans, in great part, will decide how it 
will be used. We will be there the week of March 26, and will 
give you a report of that meeting.
    [The information follows:]

    On March 30, 2000, the US-Mexico Commission scheduled a 
meeting to discuss alternative uses for the screwworm 
facilities in Chiapa De Corzo, Chiapas, Mexico. We will report 
meeting discussions and future action plans when they are 
available to the committee.

    Mr. Dunn. Miss Kaptur, I traveled down to Chiapas to meet 
with the Governor and State Director of Agriculture 3 months 
ago, 4 months ago, to tour the facility that we have there and 
see how we are coming in the phasing-out there and what can be 
done.
    There are some immediate problems that we have in Chiapas. 
One is that there is a Medfly infestation there. I have talked 
with the Governor and the Secretary of Agriculture there. They 
have convinced other states in Mexico that they need to join 
Chiapas in fighting their Medfly problem, to eradicate Medfly. 
I think that is an important step. That is one way that that 
facility could possibly be used.
    But I was very impressed by the diversity of agriculture 
that they had in this state. I had prawns one night that were 
this big. They had a Thai restaurant at this little town in 
Mexico. I said, ``Why do you have this Thai restaurant? Because 
we raise these prawns here.''
    They are doing a phenomenal job of diversity down there 
because they realize they have a real problem with the citizens 
of that State and they have got to provide jobs. It is 
something that I am very cognizant of because you have made it 
indelible in my mind that we have to do something down there 
and not just run away and leave the situation.

                   exotic pest and disease outbreaks

    Miss Kaptur. I thank you for listening to our conversation 
last year, Mr. Secretary. I know we have talked with Gus 
Shumacher at the Department and others. We shouldn't leave this 
up to only AID, which knows almost nothing about agriculture. 
We ought to work directly with USDA to try to reposition; you 
have some friends up here in Congress who would want to help 
you do that. We thank you for being open to it.
    Dr. Reed, I wanted to go back to the issue of APHIS. You 
have such an important job.
    We have always had problems; anytime you cultivate plants, 
you have pests. That is just the nature of living things. But 
it seems to me that we have an unusually large number of 
serious developing problems that are different than in past 
years.
    Could you give us some background and put the number of 
outbreaks and the size of those outbreaks in context for us, 
based on what you have found; and also submit for the record 
the numbers of outbreaks in the various categories that I know 
you have, some of the scientists in your area have? Could you 
just talk to us more generally about what is happening in our 
country as a result of trade with the outbreaks that we are 
experiencing and how does that differ from the past?
    Mr. Reed. I guess we could weave that into part of what we 
are going to submit from the Department on the increase in 
trade and the doubling and all of that.
    We were surprised by the Asian Long-Horned Beetle. We were 
looking for agricultural pests on agricultural products, and it 
was coming in on the pallets. The pallets may have barbells, 
heavy equipment, or other items, and we were focusing on cut 
flowers and agricultural commodities instead of the packaging 
materials. So we have to look at pathways that we hadn't 
considered before.
    We know that there are complicated and multiple pathways 
out of the Caribbean into Florida.
    There are innumerable things that threaten the United 
States. Hog cholera is 90 miles away. If hog cholera gets here, 
we can expect a $2 billion bill the first month and we can 
forget about trading any pork in international markets.
    The greatest impact, to give you the short answer, is we 
have already eradicated a number of things that used to be 
really important to us. When I first got out of veterinary 
school, we were at the tail end of hog cholera eradication; it 
has been gone for 25 years. If it comes back, between the size 
of the farms and the way product moves in this country, it is 
going to spread faster. The demographics of farms have changed.

          countries posing the greatest pest and disease risk

    Miss Kaptur. Are there certain countries that pose the 
greatest risks to us and, if so, what are the top five?
    Mr. Reed. It is kind of a matrix between the problem and 
the country. For plant problems, we look to Asia and South 
America as contributing to the United States' plant problems. 
For animal problems, we look at South America and Europe as 
having animal problems that we don't want to have here, either. 
So it is kind of a matrix, but I will be glad to take a stab 
and get you a list and a matrix of that.
    Miss Kaptur. Have the number of pests increased, the number 
of viruses, the number of living creatures?
    Mr. Reed. Absolutely. We know things now that we didn't 
know 15 years ago. BSE, first identified back in about 1985 is 
a perfect example. BSE is a big problem. We don't want it. We 
are aware of plant viruses and bacteria that we now know can 
cause a problem for us. As Mr. Dunn said, we don't have any 
tools in the tool box to get rid of these. We don't have a 
treatment like we do for bacteria in humans or animals to treat 
these diseases. We have more and more of these diseases coming 
into the U.S. Plum Pox Virus, which is in Pennsylvania, has 
been introduced into the United States for the first time.
    Miss Kaptur. Where did that come from?
    Mr. Reed. We know that it probably came from Europe and the 
Mideast. How does it arrive here? It may be totally 
unintentional. Citrus Canker, for example, can be carried on 
workers' shoes, on equipment, on trucks that are moving back 
and forth. It is microscopic.
    We are into a very different ball game now than we were 5, 
10, 25, 50 years ago. Plus the trade, just the sheer magnitude; 
600 flights a day have been added to all the airlines. A lot of 
those are cargo, a lot of those are international. That is in 
addition to what is already here.
    The airline industry is expanding. You go to San Francisco 
and the terminal has doubled in size. Go to Dulles, it has 
doubled in size from 2 years ago. All these places are bringing 
incredible numbers of people and lots of products. That makes 
the risk grow exponentially.

                          risk insurance fund

    Miss Kaptur. Could I ask, at the WTO on the phytosanitary 
standards and so forth, has there been any discussion of some 
sort of a risk insurance fund that deals with bailing out 
places that may be impacted by trade and assessing fees 
associated with that trade? Have you ever gotten into that 
discussion as opposed to just setting standards?
    Mr. Reed. We have. Within Marketing and Regulatory 
Programs, we have talked about the possibility of insurance 
plans for producers against certain problems. One of the ones 
that is near and dear to my heart is classical Swine Fever, Hog 
Cholera; it would be nice if we had an insurance plan to 
protect us from that disease.
    We do talk about those issues and try to find alternate 
ways to protect our agricultural producers. The user fee that 
we have for Agricultural Quarantine Inspection is helpful. We 
are adding a number of new people to keep the pest and disease 
problems out of the U.S.
    It is not enough just to be able to treat a problem when it 
is here, but to keep it out of the U.S. That is why we are 
focusing on ways to get our preclearance programs in other 
countries so that people and products are free of agricultural 
pests and diseases when they leave another port, before they 
get here, and not just checked once they get here.
    Miss Kaptur. Thank you.
    Mr. Skeen. Thank you. I think we are getting close to 
ordering the end of this hearing. Let's have Mr. Boyd. I know 
that you had something.
    Mr. Boyd. Thank you, Mr. Chairman. I will be brief.
    Just to follow up on that line of questioning, I think the 
State of Florida has currently identified between 35 and 40 
separate pests that we are fighting now and that are having an 
economic impact on our agricultural industry. That is just one 
State. Many of those are indigenous to just our State. It is a 
very serious problem.

                          commodity purchases

    Ms. Merrigan, I have a copy of a letter here--I am not sure 
whether you have seen it or not; it is dated March 8--to the 
Secretary on the issue of the use of the Department's Bonus 
Commodity Program in the purchase of commodities. It is our 
belief that the current situation with fresh market tomatoes, 
we have had an ongoing issue here with Mexico, that maybe that 
program could be used to remove some of the fresh tomatoes, 
keep them from being dumped, destroyed.
    Have you seen that and what are your thoughts on it?
    [The letter follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Ms. Merrigan. I have seen the letter. I have talked to 
staff as recently as yesterday about where this request is. As 
you know, the tomato, because it is such a perishable 
commodity, has additional challenges that we don't face in some 
other procurement situations. But the staff has been directed 
to work on this as expeditiously as possible and to think 
creatively as to ways we might be able to use the Florida 
tomatoes.
    Mr. Boyd. Thank you.
    Thank you very much. Mr. Chairman, that is all that I have.
    Mr. Skeen. Mr. Farr.
    Mr. Farr. I have one short question. Thank you, Mr. 
Chairman.
    Mr. Skeen. How tall?
    Mr. Farr. Within your time frame.

                       pest and disease pathways

    Mr. Reed, I am really interested in this discussion we are 
having on control of exotics. Have you ever considered perhaps 
bringing in the scientists from these producing countries to 
sit down with our scientists to figure out how these things are 
transported and what we might do to prevent the importation? It 
is in both interests.
    When we learn about these exotics in this country, we get 
mad at the host country. Is there a better, using our--it is 
probably not rocket science; people can figure these things 
out. Have you ever convened an international group of 
scientists to make recommendations as to how we might better 
manage these issues?
    Mr. Reed. Yes, our sister agency, the Agricultural Research 
Service and us--and you may know Dr. Dunkel comes from the 
Agricultural Research Service and heads up our Plant Protection 
and Quarantine Programs--work with international counterparts 
to establish international standards. We go to international 
meetings, international plant protection conventions, the North 
American Plant Protection Organization, NAPPO, to participate 
in international standard setting issues.
    We have numerous bilaterals with countries that want to 
move products in here and we want to move products there. So 
there is a lot of international discussion.
    Before the end of this year, we plan on having a specific 
session to determine pathways for each port. As Mr. Dunn has 
said, one size doesn't fit all. Different products from 
different areas come into different places in the country. We 
need to focus our efforts on what is going to give us the best 
shot at finding what we are looking for, whether it is in New 
York City, Detroit, or San Francisco. We will have some 
specific pathway analysis done this year, and it will be done 
with our friends at ARS.
    Within the next few weeks, we will be convening with the 
International Plant Protection Convention. We meet with them 
yearly. These are the kinds of issues we discuss. It is 
incredibly important to work these issues out with the 
international scientists so we know about potential pest and 
disease entry points.
    Mr. Farr. Is there any explanation of your kind of war on 
bugs that we could use as a primer?
    Mr. Dunn. We can get you some things, Mr. Farr. We have 
just put out a Safeguarding American Agriculture on our plant 
side with 300 recommendations of things that we need to do. 
This was something that was sponsored by APHIS. We had members 
of academia and members of the industry to work on these 300 
recommendations.
    Dr. Dunkel is in the process of prioritizing those and 
costing them out, so you will probably see them next year in 
budget requests, because it becomes imperative that we do that. 
Dr. Dunkel is the Chair of the North American Plant Protection 
Organization. He will be hosting the meeting in San Diego, 
upcoming meeting of the NAPPO, to look at this.
    On the animal side, Dr. Torres, who is our chief veterinary 
officer, meets with the Office of Epizoics, International 
Office of Epizoics, and they do a similar type of thing. I have 
asked him to prepare a similar type of--safeguarding-things 
recommendations for us on the animal side. This is becoming a 
larger and larger issue, and something that I feel it is urgent 
that we begin getting our arms around.
    Mr. Farr. I agree. Thank you.
    Mr. Skeen. Miss Kaptur.

                            bonus purchases

    Miss Kaptur. Yes, Mr. Chairman, I wanted to ask 
Administrator Merrigan, you have section 32 funds that you can 
use for commodity purchases. There is about $400 million a 
year, as I am looking at this budget that provides for regular 
commodity purchases for use in school lunch programs; but you 
can use authority up to $300 million a year for bonus buys.
    According to the budget justification that came up to us, 
you are asking, USDA plans to use only $115 million of its $300 
million in bonus authority both this year and next year. Are 
those figures correct? And if they are, why wouldn't the 
Department want to use the full $300 million in view of the 
surpluses overhanging our markets?
    Ms. Merrigan. My understanding is that those numbers vary 
because of different marketing conditions. With your 
permission, I would defer to our Associate Administrator, Ken 
Clayton, who really follows that program on a day-to-day basis.
    Miss Kaptur. I thank you for that.
    Mr. Clayton. Miss Kaptur, I will just lean over here.
    As Ms. Merrigan was indicating, the Bonus Reserve, as it is 
often referred to, is a fund which we use really depending on 
market conditions. So the numbers you see in the budget were 
sort of a best guess at the time the budget was formulated and 
sent forward, certainly subject to revision as you work through 
the process.
    I know committee staff and Department staff work to 
communicate on current status. By definition, it will change 
over time because it absolutely does depend on market 
conditions faced by producers and where we are called upon to 
utilize the funds. That will vary as we move through time.
    Miss Kaptur. Again, I just want to say with the surpluses 
in our marketplace, I really think we ought to look at those 
numbers and see if we can't use those full authorities this 
year and probably next year.
    We have left Mr. Baker kind of off the hook here today. He 
has been kind of quiet. We always like to hear from him. He 
does such an excellent job.
    Mr. Skeen. That is against his nature, too.
    Miss Kaptur. He has had a tough morning here.
    Mr. Skeen. He is a survivor.

                       anticompetitive monitoring

    Miss Kaptur. I wanted to ask GIPSA's responsibilities on--
anticompetitive monitoring of the marketplace and so forth 
involving all types of livestock, poultry. Could you describe 
for the committee some of the examples of the more onerous 
practices that you have found in the last few years in your 
responsibilities, please?
    Mr. Baker. You are probably referring to things like 
collusion, turn-taking in the marketplace.
    Just last year, we saw a major packer retaliate against a 
small feed yard operator. We will take that packer to task this 
year. When they retaliated, the packer pulled their buyers out 
of the feed yard. That will go to court. But the small and 
medium-size producers in this country are really in fear of 
losing market access. We have shifted a major part of our focus 
in Packers and Stockyards into making sure that that market 
access is there for the small and medium-size producers.
    There are numerous actions that we have taken. Many deal 
with producers who are harmed in some fashion--whether it is in 
the financial area, they fail to get paid; whether it is just 
by fraudulent or unfair trade practices.
    You had indicated earlier in your question, you would like 
to know how much of your budget is for the small and medium-
size producers. I would have to sit here before you and say 90-
something percent of ours is directed at that area.
    The biggest challenge we see in the industry today is 
structural change in the industry. The runaway train in the 
industry that has already left the station is this structural 
change. It is contracting and people trying to gain market 
access--maybe through a form of contracting or an alliance. 
This is where our people are gearing up to meet these 
structural changes in the industry.
    Electronic sales, it is unreal how many Internet sales are 
already out there. By and large, most of the people that are 
running the Internet sales have no concept of livestock 
marketing in this country. They have no concept of the Packers 
and Stockyards rules that they have to comply with. When we 
discover one, it is not like you just write them a letter and 
tell them about the rules. You have to actually go and make 
sure that they are following the provisions of the Packers and 
Stockyards Act.
    But this structural change is dynamic. It is changing the 
face of agriculture. If you talk about the grain side a little 
bit, there is the biotech issue. Also under the biotech, what 
we are trying to do is to focus in on the testing procedures 
and the equipment that is being used to make sure that the 
farmers that grow the biotech crops know the value of those 
crops, that there is a standardized process of measuring and 
valuing those crops instead of just the word-of-mouth 
assessment. We are trying to put some standardization to it. 
That is what we have asked for. Regarding your original 
question, we consider 90 percent of our budget is for the small 
and medium-size producers.
    Miss Kaptur. I hope in the written record you will 
elaborate a bit on how in the processing side you are working 
to keep access open to farmers, as you have stated here, 
because I know that is quite a challenge in many places around 
this country. Perhaps, Mr. Chairman, the remaining witnesses 
could discuss in terms of small and medium-size farmers 
administratively, or in this budget submission, what are they 
doing particularly to help them survive in this marketplace.
    Ms. Merrigan. I just jotted a quick list of things down 
which I will go through.
    I do want to concur with your assessment that we do need to 
do more. I want to take that message home to the troops and 
very seriously do an inventory of AMS programs to see where we 
might do better.
    Miss Kaptur. Thank you.
    Ms. Merrigan. Let me start. In our budget proposal we have 
a number of items for organic agriculture. We have found that 
87 percent of organic farmers are small or moderate-size 
farmers, mostly family farmers. Anything we can do to help 
support this industry, I think is important for small farmers. 
In particular, we have a budget item of $639,000 to pay for the 
first rounds of accreditation that USDA will do for the 
certifying agents. I think if we were able to find appropriated 
funds for that, we will go a long way in making sure that 
farmers out there, small farmers, won't suffer onerous fees.
    The FSMIP program--we have a budget increase request for 
$300,000 for this program. I think this is a win-win program. 
We do work with State departments of agriculture and, more 
recently, with community-based organizations to fund small 
amounts of money, on cutting-edge marketing, alternative 
strategies, mostly dedicated to small farmers and sustainable 
agriculture. It is a very small program with a very big bang to 
it.
    Procurement policies--we are the home of procurement for 
the school lunch program. I think we need to think more 
creatively in that avenue. We did a very exciting project this 
last year in the State of Florida, where we worked with some 
farmers to sell directly to schools; looking at that as a model 
and perhaps doing more of that is something that I am very 
interested in.
    Mandatory price reporting--we have a budget item in that. A 
lot of the producers, farmers that I deal with, say that they 
need more market information. One of the challenges we are 
going to face in implementing this program--I know Under 
Secretary Dunn talks about this all the time--is making sure 
that the information that comes from that program is actually 
usable and that small and moderate-size farmers really can make 
sense of the marketing environment that they are in. Once this 
program is in place, it will let us move forward.
    Farmers markets--I take your challenge very seriously. I 
think we need to do more and think more about how farmers 
markets can help be a haven for small and moderate-size 
farmers.
    Direct marketing on the Web--we have some work going on. It 
is at, I would say, the incubator stage in our direct marketing 
team, but we really are looking to do farmer-to-farmer sales 
and interesting marketing arrangements on the Internet, which 
is a growing market for everybody, I guess.
    SARE partnership--the amount of money that you provided 
last year, in the appropriations budget, to allow AMS to 
partner with the SARE, the Sustainable Ag Research and 
Education Program under RE&E, to provide grants to small 
farmers to do direct marketing research projects on their 
farms, is very important.
    Contracting--we have a proposed rule out currently--the 
comment period closes tomorrow--on forward contracting in 
dairy, where Congress directed us to do a pilot study. What we 
are proposing is that when farmers engage in forward contracts 
in dairy under this pilot program that there be a 3-day right 
of rescission, that farmers have a 3-day cooling off period, if 
you will, so they can check with their tax attorneys or lawyers 
to make sure that the contract is really what they want to 
engage in; and that they be given a disclosure sheet of what 
those contracts really mean to them.
    Those kinds of protections, to level the playing field in 
contracting, in the contracting environment that we are in, I 
think are very important; that, I think, is the beginning of 
what AMS should be doing.
    Regarding outreach, we have a very important meeting coming 
up in Memphis, Tennessee, in April. It is our Small Farmer 
Outreach Conference. We did one last year; we are going to do 
two this year, one in Memphis and one in California, where we 
bring in farmers from surrounding States, we actually provide 
them scholarships so it is a no-cost situation for small 
resource constrained farmers. We have a program of all the 
different things that USDA can do to help them.
    In this upcoming meeting in Memphis, we actually have a war 
room set up where we have people from AMS and FSA and all the 
various agencies, NRCS, and farmers can go in and talk about 
their individual problems. I think we need to do more of that, 
bring our programs out to the field.
    Finally, I do have a person in my immediate office who has 
been one of the key staffers in putting together and 
facilitating the Small Farm Commission that the Secretary 
recently appointed. We plan on continuing that partnership. I 
am hoping that body will continue to bring expertise and 
creative ideas to the Department.
    That is a short list. It is, again, something that with the 
accelerating loss of small and moderate-size farmers in this 
country, while I think it is a very impressive list, when we 
look at the statistics, we know we need to do more; and we are 
committed to that.
    Miss Kaptur. Thank you. I couldn't let this moment go by, 
when you mentioned contracting, without acknowledging Mr. 
Baker's tremendous work in trying to get information out that 
farmers can use--on contracting in the poultry industry, for 
example, as well as the price reporting that he has worked so 
very hard on. I just think he has done a tremendous job there.

                             small farmers

    Mr. Reed. Congresswoman, if I could address your question 
on small farmers.
    Miss Kaptur. I would appreciate that.
    Mr. Reed. You will find that APHIS programs probably deal 
less with big industry and more with small farmers than most 
programs. Pests and diseases hit these small producers and 
farmers, whether they have wheat fields, citrus groves, hog 
farms, or are trying to raise tomatoes. APHIS is working with 
States at the producer level.
    I was in Michigan last week. I talked to two dairymen; they 
are milking 68 head. They are worried about tuberculosis 
getting into their herds from native wild deer. So APHIS--both 
Veterinary Services and Plant Protection and Quarantine work to 
protect plants and animals, but there is a public health 
component addressed by Wildlife Services, too.
    You know of our efforts in Ohio. You know the value we have 
placed on preventing the spread of rabies. This is not only a 
small producer, but a public health problem that we need to get 
a handle on before we have to come back and ask for a control 
measure that is 35 miles wide and 1,500 miles long to keep 
rabies from getting into mid-America. It is on Ohio's eastern 
border right now.
    Miss Kaptur. It has spread west from Pennsylvania, then?
    Mr. Reed. Yes, and West Virginia. We know it is coming 
across the mountains. Our services not only benefit just 
producers, but the general public.
    All of us are committed to making sure that the small 
farmers, who are least able to deal with big disease problems, 
are compensated fairly and promptly. Last year when we started 
making payments on pseudorabies, instead of letting these guys 
sit for a month or 6 weeks, like normal, we were able to pay 
them in 48 hours. I guarantee you that as a former farmer 
myself, having the check after your barns have been cleaned out 
and you don't have any way to produce anything, it is pretty 
nice to have that check in 2 days as opposed to waiting a 
couple of months. We push hard for that.
    Mr. Dunn. Miss Kaptur, I really appreciate this question, 
because I think it really gets to the heart of why we are even 
here, all of us. It is to help those family-size operators. 
They are the ones that need help the most.
    I think--you talk about passion. When I listen to Secretary 
Glickman talk about what we are supposed to be doing, I don't 
know of anybody that gets more passionate about targeting our 
resources to those family-size operators and saying we have got 
to do more, we have to reduce this tide of losing family 
farmers out there.
    He put together the Small Farms Advisory Group. He had 
asked Deputy Secretary Rominger to head that up, and we have a 
number of initiatives that are department-wide that we are 
going on there. What I would suggest is, this is now in Under 
Secretary Gonzalez's shop, where coordination of small farm 
operations resides, but it is not his alone. We all have a part 
in that, and we all have an obligation to fund it and go 
forward.
    What I would suggest to Mr. Kaplan is that we put together 
a crosscut on the small farms budget and bring it up here to 
show you where the Department as a whole has in fact zeroed in 
on that need.
    Mr. Baker did not talk about the things that we are doing. 
We are meeting with State departments of agriculture and State 
attorneys general, as well as our general counsel, along with 
the Department of Justice, to talk about compensation and fair 
trade practices, to talk about contracting that Kathleen had 
talked about, in talking about mandatory price reporting 
because many of the States are going forward with that. The 
bottom line is, is that really helping the farmer?
    During our Outlook Conference, I had a farmer get up there 
at noontime and say, I am drowning in data and I am starving 
for information. So what we have to do is make sure that the 
information we are providing gets to that person and is in a 
usable form so that they can be successful in their operation. 
That is the challenge for us.
    I appreciate you all asking that question because I think 
that is what we should all be about.
    Miss Kaptur. I thank you for that, Mr. Under Secretary, 
very much. I know we all went over the time, but the subject is 
important. They deserve that on the record here in our Nation's 
Capital. I am glad you are all thinking that way.
    I think it would be very interesting to take a look at a 
cross-cutting budget across that Department, trying to position 
the small and medium-size farmers in this economy, because if 
you look at the distribution of the AMTA payments last year and 
the emergency assistance, it certainly didn't go there. I think 
the Secretary recognizes that in the testimony he provided us 
this year, to see the change administratively and budgetwise, 
as we approach the new fiscal year, would be most helpful to 
us. We thank you very much for that.
    That will be my last round of questioning, but I believe 
Mr. Boyd has a question.
    Mr. Skeen. Mr. Boyd.
    Mr. Boyd. I will be very brief, Mr. Chairman. I just want 
to follow up on the theme that Miss Kaptur has pursued here.
    Dr. Reed, I will give you an example. In answering a 
question earlier, you talked about the Asian foreign beetle 
which came in in wood products. My question really has to do 
with what is it that we can do--I mean, what should this 
Congress do statutorily to help you better do your job fighting 
invasive pests? You may have touched on it earlier. There has 
been some mention about the Canady bill, but I wasn't sure of 
your feelings about that. I am throwing you a little softball 
here now, to tell us what you think we can do as a group to 
help you better do your job.
    Mr. Reed. We need the Plant Protection Act passed.
    Mr. Boyd. The Canady legislation?
    Mr. Reed. Yes.
    Mr. Boyd. Thank you, Mr. Chairman.
    Mr. Skeen. Was that your telling blow?
    Mr. Boyd. That's it.
    Mr. Skeen. I just want to say thank you to you folks. This 
morning's topic is tremendously important, having come from an 
agricultural background of my own. Right off the bat, it is the 
only business I know of that when you buy, everything you buy 
is retail and when you sell, everything you sell you sell 
wholesale. As merchandisers will tell you, that ain't the way 
to go.
    You folks have a tough, tough job, and you do it well. We 
appreciate the kind of expertise that you provide, the ordeal 
that you go through, plus coming up with the necessary funding. 
Together we have a good system in the United States. We can 
argue about it, how best to serve it, but it works. You folks 
do that. Thank you very much. The questions from the panel were 
great today.
    I want to say, too, about the Screwworm thing. I was 
involved at the very beginning of that program. I will tell you 
one thing, you lose your appetite for rice pudding. I will say 
no more.
    I hope that we do get the station installed in Panama so 
that we can control that insect from the Southern and Northern 
Hemisphere as well.
    Thank you all very much. Have a good day.
    [The following questions were submitted to be answered for 
the record:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



                           W I T N E S S E S

                              ----------                              
                                                                   Page
Baker, J.R.......................................................   461
Dewhurst, Stephen................................................     1
Dunn, M.V........................................................   461
Kaplan, Dennis...................................................   461
Lyons, J.R.......................................................     1
Merrigan, Kathleen...............................................   461
Reed, C.A........................................................   461
Reed, P.S........................................................     1
Sells, D.R.......................................................     1
York, Dana.......................................................     1


                               I N D E X

                              ----------                              

                 Natural Resources Conservation Service

                                                                   Page
Accountability...................................................   201
Accountability Systems...........................................   243
Administration's Position on Voluntary Conservation..............    50
Agricultural Issues in California................................    51
Air Quality Task Forces..........................................   134
Alternate Sources of Assistance..................................   282
American Conservation in the New Century.........................     2
American Heritage Rivers Initiative............................184, 275
Animal Agriculture...............................................   186
Animal Feeding Operations......................................238, 298
Animal Feeding Operations Technical Assistance...................   190
Animal Waste and Water Quality Management Issues.................   248
Aquaculture in New England.......................................   301
Backyard Conservation............................................   191
Biomass Products Initiative......................................   143
Biographies:
    Undersecretary Lyons.........................................    21
    Chief Reed...................................................    43
    Associate Chief Sells........................................    44
    Dana D. York, Acting Budget Director, NRCS...................    45
Budget Request Breakdown.........................................   173
CCC Funding Shortfall............................................    47
Centers and Institutes...........................................   152
Clean Water Action Plan..........................................   207
Clean Water Rules and Agriculture................................     6
Common Computing Environment.....................................   287
Community/Federal Information Partnership......................144, 286
Concern About Regulations........................................   115
Conservation Challenges..........................................     3
Conservation Compliance and Conservation Operations..............   149
Conservation Easements...........................................   138
Conservation for the Entire Landscape............................   114
Conservation Incentives..........................................    53
Conservation Program Activities..................................   153
Conservation Reserve Program (CRP):
    Conservation Reserve Program.................................   275
    Expansion..................................................104, 207
    Suspension...................................................   251
    CRP Technical Assistance Availability........................   137
    Potential for CRP Enrollment.................................   105
    Proposed CRP Expansion.......................................   104
Conservation Security Program:
    Conservation Security Program vs. Conservation Farm Option...   246
    Request...............................................111, 139, 203
    Staffing.....................................................   207
Customer Base....................................................   281
Development of Farmland vs. Non-Farmland.........................   205
Earth Team Volunteers............................................   177
Easements........................................................    52
Environmental Quality Incentives Program (EQIP):
    Distribution of EQIP Funds...................................   187
    Environmental Quality Incentives Program Funding.............   134
    EQIP Allocations.............................................   178
    EQIP Expansion...............................................   209
    EQIP Priority Areas..........................................   183
Excessive Cropland Erosion.......................................   105
Explanatory Notes................................................   303
Farmland Loss....................................................   190
Farmland Protection..............................................   111
Farmland Protection Program (FPP):
    Farmland Protection Program..................................   283
    Farmland Protection Program Funding..........................   133
    FPP Expansion................................................   209
Federal Regulations for Agriculture..............................   142
Federal Reimbursements...........................................   202
Federal Return for Payments......................................    52
Florida Staff Year Increase......................................   102
Flood Plain Easements............................................   201
Forest Management Plans........................................130, 262
Forest Planning Rule Comments....................................   131
Forestry Incentives Program (FIP):
    Comparison of FIP/SIP Appropriations.........................   177
    Forestry Incentives Program Emergency Funds..................   190
Forest Service Access and Road Construction......................   102
Global Climate Change............................................   298
Grazing Lands....................................................   249
Grazing Land Conservation Initiative:
    Accomplishments for GLCI.....................................   185
    Grazing Land Conservation Initiative.........................   174
History Table for FY 2001........................................   176
Increase in Federal Regulations..................................   259
International Assignments........................................   181
International Relations..........................................   289
Irrigation/Pond Construction Assistance..........................   258
Land Stewardship on Private Lands................................     3
Legal Liability of NRCS Operations...............................   132
Limiting Urban Expansion.........................................   280
Local Government Conservation Programs...........................   279
Long Range View of Agriculture and the Environment...............   145
Loss of Agricultural and Forestland..............................     4
National Conservation Forum......................................     5
National Conservation Forum and Summit...........................   116
National Forest System Payments to States and Counties...........   140
National Resources Inventory...................................189, 299
National Soil Information System.................................   155
National Summit on Private Lands Conservation....................   277
Net Losses of Wetlands...........................................     5
Object Class Breakouts.........................................193, 203
Opening Remarks by Undersecretary Lyons..........................     2
Other Budget Proposals...........................................   143
Personnel Actions................................................   206
Plant Materials Centers:
    Fiscal Year 1999 Plant Releases..............................   157
    Plant Materials Centers......................................   155
    Plant Materials Centers Operating Costs......................   156
    Plant Materials Centers Operated by Cooperating Agencies.....   156
Preserving Arable Land...........................................   111
Private Sector Conservation Leadership...........................   133
Proposed Language Changes........................................   205
Questions Submitted for the Record:
    Mr. Farr.....................................................   302
    Mr. Kingston.................................................   258
    Mr. Skeen....................................................   147
    Ms. DeLauro..................................................   301
    Ms. Emerson..................................................   259
    Ms. Kaptur...................................................   277
Regional Offices and Technical Institutes........................   239
Regional Project Allocations.....................................   172
Regulation and Property Rights...................................    50
Regulation of Total Maximum Daily Loads by EPA...................    49
Representing Agriculture's Position on Clean Water Rules.........    58
Reprogramming Funds..............................................   137
Resolving Clean Water and Clean Air Challenges...................   138
Resource Conservation and Development Program (RC&D):
    Applications...............................................183, 240
    Applicant Areas..............................................   294
    Loan Status..................................................   170
    Resource Conservation and Development......................167, 302
    RC&D Federal and Non-Federal Assistance......................   167
    RC&D Measures Adopted, Planned, and Completed................   168
Resources and Policy to Address Farm-Suburban-Urban Conservation.   113
Section 11 Cap..................................................48, 209
Service Center Modernization Plan................................   294
Soil Erosion Status..............................................     4
Soil Surveys:
    Funding and Staffing of Soil Surveys.........................   181
    Soil Surveys...............................................154, 181
    Soil Surveys Reimbursements..................................   155
Stopping Farmland Conversion.....................................   140
Staffing:
    Current Year Staffing........................................    46
    Hiring.......................................................   248
    Staffing.....................................................   149
    Staffing Change..............................................    46
    Staff Needed for Program Implementation......................   145
    Staff Reductions.............................................   281
    Staff Year Summary...........................................   177
    Staff Year Table.............................................   150
State and Local Contributions....................................   152
Supplemental for Technical Assistance............................    47
Technical Assistance:
    Additional Local Level Technical Assistance..................   101
    All Conservation Programs....................................   153
    CCC Funded Technical Assistance..............................   296
    Farm Bill Programs...........................................    48
    Fiscal Year 2001 Technical Assistance Priority...............    47
    FY 2001......................................................    46
    Improving the Focus of Technical Assistance..................   102
    Increase Conservation Technical Assistance...................   111
    Shortfall....................................................   202
    Source of Technical Assistance in FY 2001....................    49
Technical Service Centers and Regional Offices and Institutes..151, 152
Timber Sales on Federal Land.....................................   132
Timber Supply Correction.........................................   145
Total Maximum Daily Load........................................58, 259
2001 Conservation Initiative.....................................     5
Urban Conservation...............................................   191
Urban Resources Partnership (URP):
    Authorization................................................    60
    Authority to Conduct URP.....................................    99
    Funding History..............................................   179
    Program Audit................................................    59
    Urban Resources Partnership...........................183, 201, 210
    URP, Heritage Rivers, and Pacific Salmon Expenditures........   134
    USDA's Response to URP Audit.................................    89
Urban Sprawl..................................................... 2, 51
USDA Conservation Leadership.....................................   132
USDA's Position on EPA Clean Water Rule..........................    54
USDA's Position on Proposed Water Quality Rules..................   104
USDA Support for Property Owners.................................    50
Using Sound Science to Assess Agriculture Changes................   144
Voluntary and Mandatory Programs.................................   139
Voluntary and Regulatory Rules for Conservation..................    49
Voluntary Preservation of Farmland...............................   142
Water Quality Incentives.........................................   171
Water Quality Protection.........................................    51
Water Resources Responsibilities.................................   282
Watersheds:
    Current Status of P.L. 534 Projects..........................   162
    Deaauthorized Small Watershed Projects.......................   129
    Emergency Watershed Protection Program.......................   164
    New Watershed Construction Projects Started in FY 1998-2000..   164
    Restoration Strategies.......................................   189
    Pilot Rehabilitation.........................................   252
    P.L. 566 Small Watershed Program.............................   263
    Reduced Funding for Small Watersheds.........................   129
    Rehabilitation of Watershed Structures.......................   290
    Small Watershed Program Backlog..............................   116
    State and Local Funding of Watershed Planning Activities...161, 192
    Watershed and Flood Prevention Operations Unobligated 
      Balanced...................................................   163
    Watershed and Flood Prevention Operations Loans..............   239
    Watershed and Flood Prevention Operations Loans Program......   293
    Watershed and Flood Prevention Operations Reimbursements.....   166
    Watershed Restoration Strategies.............................   189
Wetland Determinations...........................................   181
Wetlands Reserve Program (WRP):
    Wetlands Reserve Program.....................................   147
    Wetlands Reserve Program Expansion...........................   208
Wildlife Habitat Incentives Progam (WHIP) Expansion..............   209
Working Together on Conservation Issues..........................   114
Written Testimony:
    Statement of James R. Lyons..................................     8
    Statement of Pearlie S. Reed.................................    23

                   Marketing and Regulatory Programs

Biography, Under Secretary Michael V. Dunn.......................   497
FY 2001 Budget Request...........................................   463
Opening Remarks..................................................   461
User Fee Legislation.............................................   561
Witness Statement, Under Secretary Michael V. Dunn...............   466

               Animal and Plant Health Inspection Service

Agricultural Quarantine Inspection:
    Agricultural Quarantine Inspection, General...........676, 679, 685
    Fee Schedule by Activity.....................................   637
    Funding and FTE's by Airport.................................   635
    Number of Staff Years Funded.................................   634
    User Fees....................................................   685
Animal and Plant Health Regulatory Enforcement...................   671
Animal Care:
    Animal Care, General.........................................   624
    Animal Welfare........................................596, 620, 704
    Doris Day Annual League......................................   676
    Residential Breeders of Cats and Dogs........................   694
Animal Health Emergency Management...............................   680
Animal Import Centers..........................................664, 677
Argentine Citrus.................................................   683
Asian Longhorned Beetle........................................561, 680
Biography, Administrator, Craig A. Reed..........................   525
Biotechnology....................................................   666
Boll Weevil:
    Boll Weevil, General..................................687, 710, 712
    Funding......................................................   630
Brown Citrus Aphid...............................................   669
Brucellosis...............................................625, 677, 681
Carryover Funds..................................................   674
Cattle Ticks...................................................596, 638
Citrus Canker..................................................689, 698
Compensation Losses..............................................   695
Contingency Funds................................................   663
Countries Posting the Greatest Pest and Disease Risk.............   607
Emergency Authority..............................................   654
Emergency Funding................................................   701
Emergency Management Operations Center...........................   687
Emergency Management System......................................   703
Explanatory Notes................................................   960
Equine Infectious Anemia Program.................................   670
Exotic Pests and Diseases........................................   562
Exotic Pest and Disease Outbreaks................................   606
Federal/Non-Federal Dollars......................................   661
Feral Hogs.......................................................   593
Foot-and-Mouth Disease...........................................   626
Foreign Animal Disease Awareness.................................   672
Foreign Animal Disease Outbreaks.................................   696
Foreign Pests and Diseases.......................................   697
Fumigation.......................................................   683
Glassy-winged Sharpshooter.......................................   603
Grasshopper/Mormon Cricket.......................................   690
History of Budget Request........................................   668
Illegal Importations.............................................   686
Illegal Importation of Plant and Wood Products...................   700
Import/Export and Veterinary Diagnostics User Fees...............   666
Imported Fire Ant..............................................646, 675
Institute for International Cooperation in Animal Biologics......   672
Institute for Wildlife Damage Economics..........................   696
Integrated Systems Acquisition Project...........................   632
International Programs...........................................   667
International Trade..............................................   562
Invasive Species.................................................   564
Johne's Disease..................................................   680
Karnal Bunt......................................................   643
Kudzu............................................................   677
Mediterranean Fruit Fly........................................626, 685
Narrowband Radios................................................   708
National Animal Health Monitoring and Surveillance...............   644
National Center for Import-Export................................   677
National Germplasm Quarantine Center.............................   645
National Monitoring and Residue Analysis Laboratory..............   671
National Poultry Improvement Plan................................   672
National Rabies Management Plan..................................   670
Noxious Weeds....................................................   629
Outbreaks of Pests and Diseases..................................   647
Overseas Locations...............................................   659
Pest and Disease Control.........................................   695
Pest and Disease Pathways........................................   612
Pierce's Disease.................................................   597
Pine Shoot Beetle................................................   671
Pink Bollworm..................................................663, 688
Pseudorabies..............................................598, 627, 680
Regulatory Activities............................................   604
Regulatory Enforcement and Animal Care...........................   623
Risk Analysis and Safeguarding...................................   696
Risk Insurance Fund..............................................   608
Questions Submitted for the Record:
    Mr. Bonilla..................................................   707
    Mr. Dickey...................................................   705
    Mr. Skeen....................................................   620
    Mrs. Emerson.................................................   712
    Ms. Kaptur...................................................   695
Saltcedar Tree...................................................   674
Scrapie........................................................688, 693
Screwworm............................................561, 605, 626, 691
Shared Administrative Costs......................................   680
Silverleaf Whitefly............................................665, 676
Small Farmers....................................................   616
Swine Brucellosis................................................   625
Trichinae Pilot Certification....................................   669
Tropical Bont Tick...............................................   658
Trust Fund Agreements............................................   682
Tuberculosis.....................................................   631
Veterinarian Shortage............................................   704
User Fee Legislation.............................................   561
Wildlife Services:
    Aerial Operations Safety.....................................   708
    Aircraft Operations..........................................   675
    Brown Tree Snake.............................................   647
    Budget.....................................................689, 691
    Cormorants...................................................   705
    Leadership Excellence Program................................   707
    National Environmental Policy Act............................   705
    Nonlethal Methods............................................   679
    Predator Control Program.....................................   677
    Rabies Control.............................................690, 698
    Rabies Wildlife Management Plan..............................   709
    Reduction.............................................595, 707, 709
    Trap Testing.................................................   677
    Wildlife Services, General.................................638, 687
    Wolf Control.................................................   692
    Wolf Reintroduction..........................................   585
Written Statement, Administrator, Craig A. Reed..................   498

                     Agricultural Marketing Service

ADP Purchases....................................................   806
AMS Website......................................................   830
Biography, Administrator, Kathleen Merrigan......................   537
Business Process Reengineering...................................   786
Checkoff Programs................................................   833
Class III Pricing................................................   831
Cotton Programs..................................................   833
Explanatory Notes................................................   891
Farmer-Owned Cooperatives........................................   829
Farmers Markets..................................................   836
Federal Register.................................................   794
Federal Seed Act.................................................   794
Federal-State Marketing Improvement Program:
    Payments to States and Possessions--1999 Grants..............   776
    Payments to States and Possessions--1999 Locations...........   794
    Payments to States and Possessions--1999 State-by-State......   775
Free Trade with Mexico...........................................   794
Grading:
    Cotton and Tobacco Reimbursement.............................   805
    Grading Activity Employee Totals.............................   785
    Grading Fees.................................................   785
    Hunts Point..................................................   830
    Qualified Through Verification Program.......................   807
Inspection and Certification of Equipment........................   827
International Trade Prices and Volume............................   824
Limitation on Administrative Expenses............................   801
Local Producers Outlets..........................................   591
Market News:
    Breakout by Program and Increase Area........................   779
    Foreign Market Reporting Expenditures........................   779
    International Market Coverage................................   780
    Market News Consolidation or Elimination.....................   786
    Report Status................................................   780
    Object Class--Organic Grown Fruits and Vegetables............   720
    Organic Products.............................................   719
Mandatory Price Reporting:
    Budget Breakout..............................................   727
    Computer System..............................................   731
    Cost Object Class Breakout...................................   732
    Explanatory Notes............................................   728
    Overview of Spending.........................................   725
    Participation With Other Agencies............................   731
    Price Reporting..............................................   598
    Program Increase Object Class Breakout.......................   720
    Proposed Rule................................................   591
    Proposed Rule Publication....................................   733
    Staff Years..................................................   732
Marketing Agreements and Orders:
    Peanut Non-Signer Program....................................   805
    Pistachio Marketing Order....................................   806
Market Protection and Promotion..................................   828
Microbiological Data Program:
    Initiative...................................................   714
    Budget Request...............................................   840
    Object Classes...............................................   715
    Pilot Program................................................   714
Organic Certification:
    Final Rule Publication.......................................   720
    Implementation...............................................   718
    Proposed Rule Update.........................................   716
    Object Class Table...........................................   719
    Organic Rule.................................................   602
    Organic Seafood Standards....................................   828
    Program Information--Spending................................   717
Perishable Agricultural Commodities Act..........................   800
    Small Growers................................................   831
Pesticide Data Program:
    Accomplishments..............................................   721
    Budget Request...............................................   781
    EPA Involvement..............................................   586
    Federal Funds................................................   716
    Funding Table................................................   722
    Object Class Breakout........................................   724
    Rapid Response...............................................   824
    Registration and EPA.........................................   803
    Resource Table--Cost and Staff Years.........................   724
    Spending by Agency...........................................   825
    Water Testing................................................   782
Pesticide Data Programs Testing:
    Pesticide Data Program Breakout..............................   803
    Microbiological Data Program.................................   804
    Pesticide Data Program--Water Testing........................   804
Pesticide Recordkeeping Program..................................   804
Plant Variety Protection Act.....................................   806
Questions Submitted for the Record:
    Mr. Skeen....................................................   714
    Mr. Bonilla..................................................   833
    Ms. Kaptur...................................................   835
Reports:
    GAO Report Findings..........................................   815
    OIG Report Findings..........................................   808
    Status of OIG and GAO Reports................................   816
Research and Promotion:
    Assistance to Pork Producers.................................   818
    Milk Products Report.........................................   831
    Funding Received from FAS....................................   793
    OGC Legal Services...........................................   792
    New Research and Promotion Programs..........................   817
    Pork Checkoff................................................   595
    Pork Producers Referendum....................................   839
    Referendum Schedule..........................................   793
Research Cooperative Agreements..................................   817
Section 32:
    Bonus Purchases..............................................   613
    Commodity Purchases..........................................   608
    Commodity Purchases Increase Request.........................   837
    Surplus Removal..............................................   797
    Disaster Relief..............................................   796
    Emergency Surplus Removal....................................   796
    Export Purchases.............................................   797
    Table........................................................   798
Shell Eggs.......................................................   829
Slotting Fees....................................................   828
Small Farms......................................................   825
    Marketing....................................................   835
Standardization Program..........................................   783
Tobacco Funding..................................................   784
Transportation Services:
    Regulatory Actions...........................................   805
Wholesale Market Development:
    Budget Request--Projects.....................................   790
    Projects Status..............................................   787
    Santa Fe Area Farmers Market.................................   788
Witness Statement--AMS...........................................   488

        Grain Inspection, Packers and Stockyards Administration

ADP Hardware/Software Purchases.................................862-863
Aflatoxin Inspections............................................   851
Anticompetitive Behavior.........................................   871
Anticompetitive Monitoring......................................614-615
Auction Market Failures.........................................853-854
Biography of Administrator Baker.................................   558
Biotechnology....................................................   868
Biotechnology and Genetically Modified Foods....................884-885
Biotechnology Reference Facility.................................   869
Budget Increase..................................................   870
Civil Rights....................................................865-866
Competition, Fair Trade Practices, Financial Protection..........   857
Competitive Structures in Livestock and Poultry Industries.......   881
Competitive Structure of the Poultry Industry.....871-872, 886, 889-890
Complaints From Livestock Producers..............................   842
Cooperative Research Agreements.................................879-880
Custodial Account Compliance Audits..............................   857
Dealer Failures.................................................858-859
Dealer/Buyer Financial Failures..................................   852
Econometric Models..............................................869-870
Economic/Statistical Analysis....................................   858
Equipment........................................................   865
Explanatory Notes.............................................1065-1106
Export Cargo Sampling Project....................................   863
Exported Grain Complaints.......................................847-850
Final Rule......................................................878-879
Four Firm Concentration.........................................852-853
FY 2001 Budget Request...........................................   858
Genetically Modified Foods......................................876-878
GIPSA Certificates...............................................   857
Grain Dust Explosions............................................   847
Grain Facilities................................................842-843
Grain Inspected and/or Weighted.................................843-846
H.R. 2829..............................................881-882, 887-889
IBP Case.........................................................   862
Information Staff................................................   867
International Monitoring Program................................860-862
Livestock Slaughter.............................................854-855
Methods Development..............................................   867
New User Fees....................................................   875
Oat Standards....................................................   772
Other Services..................................................864-865
Pesticide Data Program..........................................859-860
Poultry Complaints..............................................882-883
Poultry Compliance Complaints....................................   851
Poultry Investigation Work......................................883-884
Poultry Legislation.............................................589-591
Production and Marketing Contracts...............................   870
Proposed Regulations--Feed Weighting............................863-864
Questions Submitted for the Record:
    Mr. Skeen...................................................842-875
    Mrs. Emerson................................................887-890
    Ms. Kaptur..................................................876-886
Rapid Response Teams...................................872-874, 885-886
Select Elements in Grains........................................   859
Slaughters/Processors Subject to the P & S Act..................855-856
Sufficient Authority.............................................   881
Swine Contract Library..........................................874-875
Texas Panhandle Investigation....................................   864
Unrecovered Losses...............................................   859
U.S.-China Agreement............................................866-867
Value-Added Traits...............................................   868
Violation Cases--Grain...........................................   860
Violation Reports................................................   851
Written Testimony of Administrator Baker........................538-557

                                
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