[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 5

                 FARM AND FOREIGN AGRICULTURAL SERVICES

                    PROGRAMS AND FOOD SAFETY PROGRAMS
                                                                   Page
 Farm and Foreign Agricultural Services...........................    1
     Farm Service Agency
     Foreign Agricultural Service
     Risk Management Agency
     U.S. Agency for International Development--
         Public Law 480
 Food Safety......................................................  857
     Food Safety and Inspection Service
                                ________

         Printed for the use of the Committee on Appropriations
                                ________

                     U.S. GOVERNMENT PRINTING OFFICE
 64-001                     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 9, 2000.

                 FARM AND FOREIGN AGRICULTURAL SERVICES

                               WITNESSES

AUGUST SCHUMACHER, JR., UNDER SECRETARY, FARM AND FOREIGN AGRICULTURAL 
    SERVICES
KENNETH D. ACKERMAN, ADMINISTRATOR, RISK MANAGEMENT AGENCY
KEITH KELLY, ADMINISTRATOR, FARM SERVICE AGENCY
TIMOTHY GALVIN, ADMINISTRATOR, FOREIGN AGRICULTURAL SERVICE
PARKS SHACKELFORD, ASSOCIATE ADMINISTRATOR FOR PROGRAMS, FARM SERVICE 
    AGENCY
RICHARD FRITZ, GENERAL SALES MANAGER
HUGH PARMER, ASSISTANT ADMINISTRATOR FOR HUMANITARIAN RESPONSE, AGENCY 
    FOR INTERNATIONAL DEVELOPMENT
STEPHEN B. DEWHURST, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE

                       Introduction of Witnesses

    Mr. Skeen. Glad to have you here this morning. We have the 
membership representation. We are in session. Good morning. 
Today we have with us Gus Schumacher, the Under Secretary for 
Farm and Foreign Agricultural Services. He is the boss of the 
Risk Management Agency, the Farm Service Agency, Foreign 
Agricultural Service, and the General Sales Manager. Boy, that 
is a long list. You have some great folks here.
    We also have Mr. Hugh Parmer, the Assistant Administrator 
for Humanitarian Response of the Agency for International 
Development. Among Mr. Parmer's responsibilities is managing 
about $850 million in food aid provided by this subcommittee 
for titles 2 and 3 of Public Law 480. This is a very important 
hearing. Unfortunately we are moving into the full committee 
markup of the supplemental in a while so I would appreciate 
everyone's cooperation and patience in getting the most out of 
this hearing while we can. I would ask Mr. Schumacher and then 
Mr. Parmer to make their statements. Before that we will just 
let you, Mr. Boyd, serve as Ms. Kaptur.
    Mr. Boyd. I am not sure that I can stand up to that order--
--
    Mr. Skeen. You are a very bright guy.
    Mr. Boyd [continuing]. Mr. Chairman, but in her stead I 
will say just welcome to Mr. Schumacher and to your team, Mr. 
Parmer, and Mr. Dewhurst and others. I know that you have a 
very difficult job and look forward to your testimony and 
having a dialogue with you this morning.
    Mr. Skeen. Thank you. Mr. Schumacher, it is all yours.

                  Under Secretary's Opening Statement

    Mr. Schumacher. Thank you, Mr. Chairman. I am delighted to 
be here. I think this is my seventh time, my seventh year, that 
I have been here before this committee. I may be here next 
year, who knows in future, but I have always looked forward to 
my time here. I look forward to testifying on behalf of my 
mission area. I have always been treated very well by this 
committee. I want to thank you for the many years that I have 
been coming before this committee.
    Mr. Skeen. It is a mutual appreciation.
    Mr. Schumacher. I have actually counted those sheep--there 
are 26 sheep in the picture behind you. I used to raise sheep.
    Mr. Skeen. Since we got rid of the coyotes, we have not 
lost any of their flock.
    Mr. Schumacher. I used to actually name my sheep. I haven't 
put names on those sheep behind you, sir.
    Mr. Skeen. Those of us who know anything about sheep have a 
lot of patience. Thank you, sir.
    Mr. Schumacher. I am honored to be here because I 
particularly wanted to thank my 18,000 employees in my three 
agencies who worked so hard in the last 3 or 4 years under very 
tough times getting the programs that you have appropriated out 
to family farmers. We have put out a great deal of support for 
them and I think that farmers are very appreciative of the 
programs that you have appropriated and that we have 
implemented in getting them through 2 or 3 years of very 
difficult times.
    With this new format, I am going to ask your permission--I 
will be very brief, Mr. Skeen. I have brought a few charts to 
make my testimony go a little faster, some of which I have put 
before you. Accompanying me are Mr. Kelly from the Farm Service 
Agency, Mr. Ken Ackerman from the Risk Management Agency, and 
Mr. Galvin from the Foreign Agricultural Service. With your 
permission, during the question period, I may ask them to join 
me at the table.
    Mr. Skeen. You certainly may.
    Mr. Schumacher. I am delighted Mr. Parmer is here. He has 
done extraordinary work over the years on the humanitarian 
side. I think he has a very good statement. And Mr. Dewhurst 
has counseled me for many years on budget issues.
    Mr. Skeen. He has been counsel to all of us.
    Mr. Schumacher. He has done a terrific job. Very briefly, 
we have had some tough times in American agriculture in the 
last 3 years, very tough times. The declining prices we are all 
aware of. It is not just in major commodity crops. What we are 
also finding is the specialty crops have really suffered. 
Apples, in Washington State, many other States, New England, 
New York, have had a very tough time. The crop that was always 
a big mortgage lifter in my State, cranberries, has gone from 
$80 to $20.
    So right across the board, except perhaps for feeder cattle 
and now pigs, which have come up a little bit, most of 
agriculture is in dire straits and doesn't look to get any 
better. We would like to work with you to see if we can't work 
through some of these issues and get some support. The 
President's budget that we sent up includes some creative and 
innovative approaches in four areas: In a counter-cyclical 
income support program; some additional work for crop 
insurance, which worked quite well in the last years with your 
additional funding; conservation programs; and on the trade 
agenda as well. We have also hit some marketing initiatives in 
there. We are asking this committee to consider $11 billion 
over the next couple of years, but for this year an additional 
$6 billion.
    Unlike some of the previous ad hoc work we have done, this 
is not lurching from emergency bill to emergency bill. This is 
on budget, fully offset, paid for in the context of a balanced 
budget. It is presented as part of the President's budget, part 
of our regular budgetary process so that Congress can look at 
it earlier in the year and allow farmers--and particularly 
their creditors, Mr. Chairman--to plan ahead. When I am 
visiting many parts of the country, what we are finding is that 
farmers will say to their lenders that Congress will enact some 
emergency programs and you should build that into the cash flow 
projections because prices are so low and it affects the 
farmer's cash flow. They are asking their bankers to have faith 
in Congress that you will provide some emergency funds. The 
bankers are saying, well, they might, but we are not certain. 
What we are asking is to create some more certainty so that 
when farmers go in with their farm plans to get credit this 
spring they will have more certainty over the next couple of 
years when farm prices are expected to be low. We are hoping 
this will go forward. We will certainly take all of your 
questions, in particular looking to this proposal in the 
President's budget to provide a bridge to the consideration of 
the next farm bill.
    Let me talk briefly about it. One, a counter-cyclical 
supplementary income assistance program. That is the key 
component. It is triggered when revenue is projected to fall 
below 92 percent of its 5-year average. Importantly, these 
payments would be in addition to the core AMTA payment, what 
you call the production flexibility contract payment. We think 
it is fair. For example, I met with some Alabama farmers the 
other day, about 300 of them were up. They were very concerned 
about the impactof the double AMTA payment because they said 
that landlords were raising the prices. As full-time farmers, not just 
one or two, a half a dozen came up to me afterwards and said, if you 
are there testifying please tell them about the Alabama farmers who are 
finding their land rents going up because the landlords are really 
pressing them for higher rents because of the double AMTA payments. It 
was quite emotional. They were very concerned, they wanted the payments 
to go to the farmers who actually produced the crop, not to the 
landlords who are beginning to get quite a bit of benefit, and that is 
because land rents continue to go up in a number of areas when farm 
prices are falling.
    On the marketing side, we are very concerned and we are 
putting out some new regulations for on-farm storage. They 
should be up very shortly. We are also proposing in our budget 
for your consideration $130 million for a capitalization fund 
to help livestock and other cooperatives construct processing 
facilities to create some competition, because increasing 
concentration is taking place in agri-processing and agri-
marketing. We also have some proposals here on crop insurance, 
particularly on additional money for buy-up coverage. That has 
worked very well.
    We have also added, very important for specialty crop 
producers, $110 million for the removal of the area trigger for 
the non-insured assistance program. When I am in California I 
get--not accosted but certainly criticized, when a freeze or a 
storm affects some farms but does not generate a 35-percent 
loss in that county, because then those specialty growers are 
not eligible for the NAP program. In the East the same issue 
occurs. We are asking for the removal of the area trigger to 
help the specialty crop growers as well.
    We have a number on crop insurance, but because of the 30-
percent buydown and the great work that Ken Ackerman and his 
team have done, we have increased coverage in crops from $14 
billion to $30 billion up to about 190 million acres on crop 
insurance. We are looking forward to your answers on that.
    Conservation is the third area--very, very important. In 
particular we have a Conservation Security Program we put in 
the budget that will be administered, if it passes, by Mr. 
Lyons and his group. This gives $600 million to help producers 
who carry out existing practices and new practices for 
environmental mitigation, conservation, and livestock. So we 
hope you would consider that favorably.
    And then on the trade side, as you know our exports totaled 
about $60 billion when I was testifying here in 1995-1996. That 
has dropped. I wished it had stayed there. It has dropped back 
to $50 billion and that has caused some heartburn in the 
countryside. So we are asking for additional flexibility to use 
unexpended EEP balances to help trade promotion for all crops 
and also for additional food aid when we need it, an important 
initiative.
    Finally, the Commodity Credit Corporation. Our net outlays 
increased to $10 billion in 1998, $19 billion in 1999, and 
Steve tells me that we are projected to increase to a new 
record high of about $27 billion in fiscal year 2000.
    So this is important. You have raised the cap on 
reimbursement for losses, and we welcome that. The 2000 
appropriation for reimbursement of CCC's net realized losses 
was a current, indefinite appropriation. This allowed CCC to 
request funds as needed from the Treasury up to the actual 
losses recorded for the most recent actual year. This was 
crucial, Mr. Chairman, for ensuring during these tough times 
that the CCC had sufficient borrowing authority to provide 
timely assistance to the producers this year.
    We met with Mr. Boyd and others yesterday on some of these 
important CCC issues as they affect the specialty crops in 
Florida. CCC is so critical to some of this work. So our 
request again provides for a current, indefinite appropriation 
to reimburse the Corporation for actual net realized losses 
even if incurred during the current fiscal year. This will give 
us additional flexibility and ensure sufficient funds flexibly 
to meet current program requirements.
    I will touch briefly on farm loans and conclude then with 
the key issue of staffing. The Farm Service Agency is a real 
buffer to farmers in these tough times. We have a 14-percent 
increase in our direct farm operating loans this year and a 24-
percent increase which we are providing to socially 
disadvantaged farmers this year to help minority farmers and 
socially disadvantaged farmers get some assistance in tough 
times.
    Our 2001 budget includes funding for about $1 billion in 
direct loans and $3.5 billion in guarantees. It does not 
reflect any change in policy; we continue to support providing 
sufficient credit for those farmers that need it when times are 
tough. Our request is $1.5 billion above this year's regular 
appropriations. The budget also includes direct loans of $100 
million for boll weevil eradication and $2 million for Native 
Americans for land acquisition.
    Let me turn, Mr. Chairman, with your permission, to our 
staffing issues. As we indicated--if we could show that other 
chart on the Farm Service Agency--you could see going back to 
1998 there were three disaster programs that we administered. 
Then in 1999 you provided us eight additional programs in 
addition to the core Freedom to Farm bill in 1996. Last year 
you asked us to administer basically 20. We added a couple 
ourselves.
    So we have major programs that have come up, with an 
enormous amount of work to get the regulations out and get 
these funds out to farmers. I am very pleased that we have 
about 82 percent of the money you provided, of the $8.7 
billion, out. We have some more to do and I will take questions 
on those additional programs. But I am very pleased that we 
have been able to get that money out, but our staffing is 
strained--they have worked very hard. There is a lot of stress 
across the mission area. It has been very difficult. We are 
going to have more--on the oilseeds alone we will probably 
have, I think, something on the order of 800,000 farmers 
visiting our offices over the next couple of months to sign up 
for that program. An extraordinary amount of work.
    We have work to do and I will take your questions on the 
staffing. We have proposed supplemental funding for some 
additional staffing needs and we hope that you will be helpful 
with that in your markup.
    We have talked about the Farm Service Agency, we have 
talked about the staffing on the Risk Management Agency. Just 
put that one chart up, Alex, that one in the front there. You 
can see that the amount of liability has really increased yet 
we have been pretty flat on the RMA budget. As we get more and 
more into covering crop insurance under our safety net, we do 
need a staffing increase--I want to bring that to your 
attention. We are pretty straight-lined on the RMA given the 
enormous increase in liability that we are administering.
    Then finally on the Foreign Agricultural Service. We have 
worked very hard, particularly on the food aid side and the 
credit side and on trade promotion in the Foreign Agricultural 
Service. Hugh can talk more about that issue as well. As some 
of the charts on food aid that I have in the front show, we 
have really gone up--you can see the enormous food aid, Mr. 
Chairman, that we have been doing, particularly with Hugh 
Parmer's assistance at AID. That has benefited nearly 40 
million people who had difficulties in the last couple of years 
in nearly 60 countries. I am very proud of what we have done 
together to help these people overseas. We programmed nearly 
9.6 million tons of food assistance last year. In this current 
year we will be looking at about 8 million metric tons of 
assistance, and Mr. Parmer and I can talk about that as well.
    We are working very hard. We have increasedour GSM programs 
as well and we are asking to use unexpended balances on EEP for the 
food aid and trade promotion. We have seen also a rekindled interest in 
food aid for development purposes to help very poor people in many 
parts of the country. We are providing food aid, it gets monetized and 
in some cases we have been able to use that to help very poor people. 
For example, in the Dominican Republic, we used some of our USDA 
monetized food aid to open up a farmers' market. We are going to do 10 
more. I was down there a couple weeks ago and observed these people, 
mostly women, selling in 50 stalls. They were so successful they went 
back 3 times to replenish their stalls and they were telling us how 
important it was to their household income. They hadn't had one of 
those before. We were able to help those poor women participate in the 
growing economy by targeting some of the monetized food aid proceeds.
    I want to conclude now because I wanted just to summarize 
my statement. We have full statements from myself and my three 
administrators, which I would like to enter for the record to 
save time, with your permission, sir.
    Mr. Skeen. Certainly.
    Mr. Schumacher. I am looking forward to working with you on 
another very important budget that we are proposing for you 
that has these four key elements: a counter-cyclical income 
support proposal to help the farmers and not the landlords; a 
trade initiative; a crop insurance initiative; and a very 
important conservation initiative to help all of the farmers 
throughout the country. I thank you, sir, for being here today.
    [The prepared statements and biographies of August 
Schumaker, Keith Kelly, Timothy Galvin, and Kenneth Ackerman 
follow:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Mr. Skeen. Thank you for the testimony. And of course you 
are dealing with a problem in agriculture that you don't find 
in many other businesses because everything they sell they sell 
wholesale and everything they buy they buy retail. So it is a 
very tough balancing act. You have done a good job with it.
    Mr. Parmer.

                     mr. parmer's opening statement

    Mr. Parmer. Thank you very much, Mr. Chairman, members of 
the Committee. I want to thank this committee on behalf of the 
United States Agency for International Development and the 
Bureau for Humanitarian Response, which I head, but more 
particularly on behalf of the 3 million chronically hungry 
children in the world. It is because of the historic broad 
bipartisan support that international food aid has enjoyed that 
we were able to last year assist 45 million people who 
otherwise would have gone hungry.
    I am just going to excerpt a very few things from my 
prepared testimony because as some of you know I like to put a 
human face on food aid so that we can understand that we are 
not talking just about numbers and about volumes of commodities 
but we are talking about people around the world who are in 
danger of suffering from malnutrition and hunger.
    In essence, this year the administration is proposing $837 
million in new budgetary authority for P.L. 480, title II. That 
compares to $837 million in fiscal year 1999, which does not 
include the $149 million which Congress provided in Kosovo 
supplemental funding and it compares to $800 million in fiscal 
year 2000. The relative constancy of the request for food aid 
from the Food for Peace Program is a reflection of the help 
that we have been able to get from you and from our friends at 
USDA and the availability of 416(b) commodities to deal with 
many of these humanitarian crises.
    Just to give you a scope of what the United States has 
provided in assistance, we provided 3.9 million metric tons of 
assistance through P.L. 480 valued at approximately $1.4 
billion to 60 developing nations around the world. We at USAID 
were able to handle and manage 960 million to 1.9 million 
metric tons of U.S. commodities reaching, as I said, 45 million 
beneficiaries. But what I think, as we sit here today and we 
watch and see in the news media the crisis that is going on in 
Mozambique as a result of the terrible flooding down there, you 
should know as we sit here today, $7.3 million of United States 
Food for Peace food aid is being loaded on ships in Texas and 
Louisiana and it will arrive in mid-April to assist the flood 
devastated peoples of Mozambique. There are 600,000 people 
there who have been displaced from their homes and maybe as 
many as a million. It is difficult to estimate because it is 
difficult to get around there still. My bureau has at this 
point 30 people in Mozambique. But one thing that is clear is 
there is going to be an interim need for emergency food 
assistance for these people in the displacement centers in 
which many of them have been located.

                            hurricane mitch

    It reminds me a lot of Hurricane Mitch, which we talked 
about the last time I was here. The United States, as you may 
recall, launched through Food for Peace a humanitarian food 
airlift into Tegucigalpa, Honduras, and into Managua, Nicaragua 
at the height of that crisis and again we were able to provide 
immediate food help. I had an opportunity during the Mitch 
relief effort to go down and to fly with the United States 
soldiers who were delivering United States food aid to people 
in isolated villages. I will always remember flying over a pass 
in between two mountains with a bridge at each end. Both 
bridges were out and there were roaring torrents of water. And 
seeing people run out of small villages and waving at the 
helicopter and motioning us down, our party was on board two 
Blackhawk helicopters with large bags of Food for Peace flour 
on board. We were only able to put down one helicopter, the one 
that I was on, into the corn field which was the only landing 
zone. We landed in this corn field and there was initially no 
one there. And then it was almost a mysterious kind of thing as 
people began coming out from the woods and through the stalks 
of corn to congregate around the helicopter. Finally--I am sure 
everyone in the village because there was at least 250 
peoplethere. They formed a chain, a human chain keeping low below the 
blades of the helicopter and we off-loaded all of the flour that was on 
board the helicopter. In my not really great Spanish--I am glad to see 
my fellow Texan, Mr. Bonilla, is not here, he would tell you how bad my 
Spanish really can be. I asked who is here to help you? Who has been 
here----
    Mr. Skeen. Chemo, sabe.
    Mr. Parmer. They said you are the first. This was 6 days 
after the flooding. So the faces of those children, the faces 
of the people is something that I will keep with me forever.

                          assistance to kosovo

    The story I really wanted to tell you, because of the 
outstanding thing that Congress did in providing us with 
assistance, were the people of Kosovo. My last trip to Kosovo 
was about 60 days ago. I went with a member of the United 
States House of Representatives, not a member of this 
committee. And he and I traveled with a very small party. We 
overnighted in several different cities in Kosovo. One day we 
were being shown some areas in which there had been people--
they said these little villages have not been reached. Well, we 
got to a farmhouse where there clearly had been a tremendous 
fire fight. The buildings were all down and it looked like the 
Alamo, if you will forgive me. The shell holes in the walls. 
There was a gentleman there, a man and his family there. They 
had a UNHCR tent, a United Nations sort of a summer tent. It 
was cold, it was raining. And we began to talk to this man. I 
said to him, you have your family here and you have this tent, 
maybe I could find you a place in Djakovica, which was the 
nearby town with a family you could stay with. Through my 
translator he said, no, I can't go to Djakovica, I have to stay 
here. I said, why, it is cold and wet? He said, well, you gave 
me this stuff. And he took me in his tent and there it was, 
food aid from the United States, from the people of the United 
States. And he said, besides I have my animals that I have to 
take care of. He said, don't worry about us, we have made it 
through last winter, the war; my family is all alive and we are 
safe.
    I didn't think at all. I just spontaneously said, and you 
are free. And then he cried. And then I cried. And I have to 
tell you there were tears in the eyes of one of your Members of 
Congress that was with me, too. That is what the United States 
humanitarian assistance means around the world. And the bulk, 
the majority of that assistance is food assistance. It is this 
remarkable productivity of the American farmer and the 
political will to use that productivity to help people around 
the world exhibited by you that makes those kinds of stories 
possible.
    Now, one thing I would like to tell you because it is a 
story that doesn't get told very often. And that is this is 
not--the humanitarian relief and response business is not an 
easy business. This year a World Food Program worker was 
assassinated in Burundi while trying to check on the need for 
food in resettlement camps. Twenty-four humanitarian workers 
were killed in Kosovo when a World Food Program plane crashed. 
CARE employees were jailed in Serbia and accused of spying. You 
cannot measure the personal sacrifices that people who are 
willing to do this work make every day.
    I am proud to see our military forces in Kosovo. It warms 
my heart, as it does everyone else, to see that American flag 
and those American symbols, but let me tell you, the staff of 
the Food for Peace and the staff of the USAID, put their life 
on the line every day somewhere around the world to help 
people. It is a story that needs to be told more frequently. 
But it is a mission that we could not carry out without the 
assistance of this committee and the Congress and the broad 
bipartisan support that these humanitarian programs have 
enjoyed. It was in fact of course President Reagan who coined 
the phrase that we use so frequently, a hungry child has no 
politics.
    I will be glad to answer any questions.
    [The prepared statement and biography of Hugh Parmer 
follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Mr. Skeen. That was an excellent trailer of just how 
important food is as a commodity worldwide and we take it so 
much for granted. I think you have done an outstanding job with 
the materials and things that we have--we just don't know 
whether we can keep up with all of it to feed everybody. We 
would like to do that.
    Mr. Parmer. I understand. Thank you, sir.
    Mr. Skeen. You certainly made the program more appreciated.
    Mr. Parmer. Thank you, sir.
    Mr. Skeen. Ms. Kaptur.

               meeting increased food aid workload demand

    Ms. Kaptur. Thank you, Mr. Chairman. We would like to 
welcome Secretary Schumacher and Mr. Parmer and certainly Mr. 
Dewhurst and all of your capable staff who are with us today. I 
sit here and I look at quadrupling food aid last year. In any 
business that would be a monumental reach. I am sitting here 
asking myself the question how did you do it.
    Mr. Schumacher. The staff did it, Ms. Kaptur. It was the 
extraordinary extra effort that the staff put in. We were 
straight-lined. In fact, the Foreign Agricultural Service 
budget was cut. And the staff felt so strongly both in my 
agency and Mr. Parmer's agency, they went the extra mile to get 
this food aid out to hungry people. Forty million people were 
fed because of the generosity of this Congress and the American 
family farmer. We are proud of that.
    Ms. Kaptur. I just returned from Rome. I met with 
representatives of the World Food Program. This is probably 
known to you but I would venture to say that most Americans 
don't realize that half of the food aid that is sent around the 
world comes from one country, the United States of America. We 
obviously aren't the largest country, but the significance of 
what you do and what our people do I think is apparent in those 
numbers.
    I think, Mr. Parmer, what you said about the danger in 
which many of those who are on the ground work I don't think is 
broadly understood. So we just officially want to thank all of 
those in both your departments and those private organizations 
on the ground who have managed to deliver this food. I just 
find it absolutely incredible--I am not pleased with this 
Congress for having cut back your budget at a time when we are 
trying to help the American farmer and move product and then 
cut your staff. I honestly don't see how you did it. I hope for 
the record you can provide some indication to us of how you 
were able to quadruple food shipments.
    Frankly, I would like to quadruple them again based on what 
we have in silos and storage facilities in our communityand 
help prices in our country and help feed hungry people around the 
world. I would hope that members of this committee would seriously look 
at these budgets this year and you would give us an indication of how 
were you able to accomplish this incredible increase in food deliveries 
with the staffing levels that you were forced to strain and what 
happened in other countries where these food commodities and 
monetization efforts occurred. I would hope that you would clarify for 
the record how in Heaven's name you were able to do this with reduced 
staffing levels.
    Mr. Schumacher. I will ask Mr. Galvin later on to do this 
or we could do it now. One of the things we also looked at was 
using the Internet a bit more efficiently. For example, the 
Farm Service Agency staff in Kansas City really did an 
extraordinary job of procurement on a competitive basis. More 
and more we are using the Internet for competitiveness. That 
has been helpful for us, using some of the new technologies. We 
can get a note up to you for the record on what we are doing in 
the Farm Service Agency, in the Foreign Agricultural Service 
and the Risk Management Agency to use some of these new 
techniques to assist in this as well. Some efficiency there, 
mostly it was the hard work and overtime of the staff.
    Ms. Kaptur. I don't know how we can thank them enough. I am 
sure the lives that they saved, there is no way those people 
will ever fully say thank you, either.
    I wanted to ask you to discuss the relationship between 
USDA and AID on these various agriculture programs. When Brian 
Atwood was before our committee 2 years ago I asked what 
percent or number of the 10,000 people who were directly for 
AID on contract, how many of them actually were specialized in 
agriculture. Several months later they came back to me with a 
number of 80. 80 out of 10,000. And I have looked at these USDA 
and AID programs relative to rural development around the 
world. I have to tell you that I am not completely comfortable. 
Recently I was in Lebanon walking through the countryside and 
finding all of these former hashish fields which the United 
States was successful in cutting back and eliminating but no 
replacement crops have been put there. The Hezbollah was 
gaining in those villages where people were absolutely 
impoverished. I said how could this happen, how could we do 
half the job but not the other half in creating replacement 
crops?
    This morning there is an article in the newspapers about 
Afghanistan called ``the paradox of the poppy.'' People don't 
want to raise poppy. They are being encouraged to raise some 
other products. There are wheat seeds and apricot seedlings, I 
guess, but they are not a fit inside that economy. And so the 
question I ask myself is what do we need to do institutionally 
to make these programs function better? Should one agency 
really be in charge? And I would like to get a sense from each 
of you as to this working relationship which on the ground 
sometimes gets disconnected, especially in terms of relating to 
the needs of these various countries.

                   inter-agency coordination overseas

    Mr. Parmer. It is interesting to hear you say that because 
I think our view at USAID and our Food for Peace is of all of 
our friends in the executive branch of the government, we work 
the best and most cooperatively with the Department of 
Agriculture. And so what you may be letting me know is that 
while we have that kind of close warm relationship here in 
Washington it may not necessarily always penetrate down to the 
fields. I appreciate you bringing that to my attention.
    We are just extraordinarily grateful to these people. We 
managed approximately the same amount of food last year. All of 
this increase in productivity that you are talking about was in 
Gus' shop. Not to say that we are not productive and we 
certainly helped and assisted them in doing that, but another 
prime example they do all of our purchasing of commodities for 
us. They work with us in terms of U.S. representation before 
the World Food Program, where I generally sit as the United 
States representative on the executive board. When I am not in 
the chair a representative of USDA is there. At the macro-level 
our cooperation is very good.
    USAID has in an effort to become more efficient, we have 
sort of a bifurcated system, Ms. Kaptur, in which Food for 
Peace manages the money and the commodities from Washington, 
but the actual geographic missions like the mission in Ukraine 
or the mission in Russia or the mission in Lebanon, they 
actually manage the food programs on the ground. So we have 
development food which you have given us responsibility for 
managing the money, but when that food goes in country for 
development food, it is managed by one of the regional bureaus 
of USAID.
    I will tell you this, the title II commodities by law and 
by policy are supposed to be directed toward countries 
exhibiting food insecurity. So, for example, in Lebanon I think 
there was some 416(b) commodities in Lebanon last year, but 
there is no Food for Peace in Lebanon because it doesn't fit 
the mandate that we have been given. Let me ask Gus to comment 
on the interrelationship at the local level if I could.
    Mr. Skeen. We have a vote on but go ahead.

                       use of monetized proceeds

    Mr. Schumacher. I think one of the things that we have been 
working very hard with AID on is the monetized use of proceeds 
to help not only in directly feeding people but also help them 
get more income. I will give you three very brief examples that 
Hugh's people and I have worked on together. I have laid out 
our tremendous program in the Dominican Republic. We are 
feeding children in schools in Ecuador to try and get them into 
school lunch programs using our monetized proceeds--Hugh has 
been helping with that. And in Yemen, a very difficult country, 
a lot of the refugees were building clinics and small stores 
for very poor people in refugee camps. Just three examples 
where AID and the United States are working closely together to 
use the monetized proceeds to help people.
    Ms. Kaptur. Mr. Chairman, I realize our time is up and we 
have a vote but I would just ask Mr. Parmer and Mr. Schumacher 
for the benefit of the members of this committee this 
relationship on the ground globally sometimes doesn't work. We 
have got to explore staff-wise why. I am going to submit for 
the record this article about what has happening in 
Afghanistan. I will submit additional information about the 
Lebanese situation, but I think it is really important to 
figure out how we get into the administrative situation we are 
today with this bifurcated responsibility between USDA and 
USAID and ask ourselves the questions for the sake of our 
agricultural infrastructure here at home and the needs abroad, 
how best can we help them meet at the ground level. And we 
would really appreciate the benefit of your joint experience on 
this as we look at staffing levels and our colleagues perhaps 
from some of the other committees.
    So I thank the chairman for allowing me to go over here a 
bit and we appreciate your testimony.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Mr. Skeen. Mrs. Emerson, do you have a quick one?
    Mrs. Emerson. I bet we can do it in 5 minutes.
    Mr. Skeen. Fine.
    Mrs. Emerson. Mr. Secretary, rice is the only remaining 
major farm commodity that our government generally refuses to 
make available to potential customers in the unprocessed form 
under P.L. 480 and other food aid programs. We provide for 
requests not only for the export of flour but of wheat, soy 
beans, soy bean meal, soy bean oil. Except for one shipment to 
Jamaica, rice for about the last 50 years has been limited to 
just shipments of either milled or brown rice, but no rough 
rice. Now, that sounds to me like it reserves exclusive access 
to P.L. 480 to the rice millers at the expense of the rice 
producers of my district. I am just curious as to why that 
policy exists.

                         exports of rough rice

    Mr. Schumacher. Very briefly, about 30 percent of our rice 
that is commercially exported is rough rice. We are doing very 
well on rough rice in Mexico and some of the Caribbean and 
Central American countries. We are also providing Market Access 
Program funding for the association that promotes rough rice 
commercial exports. But our policy has been to keep the added 
value on our publicly funded programs in rice here in the 
country. Traditionally we have exported milled rice for food 
aid programs, P.L. 480 and other programs. We have had a number 
of comments from the rough rice producers and they would like 
us to change that policy. We are looking at it but that policy 
still continues to promote on a publicly funded basis the 
milled rice industry.
    Mrs. Emerson. Except for the fact that with soybeans, 
soybean meal, and soybean oil we are in fact under P.L. 480 and 
416(b) donating shipments of unprocessed goods and commodities 
and we are not doing the same with rice. I know that Jamaica 
apparently has requested that we send another shipment of rough 
rice to them. I know you are in the decision-making process and 
actually were supposed to make a decision a couple of weeks 
ago. But in our committee report last year we had asked for 
fair treatment for the producers as well as what the millers 
are already getting, and the Senate report said that too. Can 
you give me any indication of what your decision is going to 
be? Are we going to allow that shipment to go to Jamaica and 
are we in fact going to ensure fair treatment for our rice 
producers?
    Mr. Schumacher. We are going to make that decision very 
shortly on Jamaica. I will call you prior to that decision 
being announced. We will certainly review and take your counsel 
on the rough rice versus milled rice but until now our policy 
has been to provide in publicly funded----
    Mrs. Emerson. I understand.
    Mr. Schumacher. Our policy has been continuing and we will 
bear your comments in mind on that.
    Mrs. Emerson. I think we are discriminating against rice as 
opposed to the other commodities, particularly when we send our 
other commodities in unprocessed forms to countries. And 
certainly I would hope that you will come down on the side of 
fairness in this.
    Mr. Schumacher. We will certainly bear that in mind.
    Mrs. Emerson. I will stop now, Mr. Chairman, and wait for 
the next round.
    Mr. Skeen. Excuse us while we go vote. We will return after 
saving the Nation one more time.
    [Recess.]
    Mr. Skeen. We will go back on the record. Mr. Boyd.
    Mr. Boyd. Thank you, Mr. Chairman. Welcome, Mr. Parmer, Mr. 
Schumacher, Mr. Dewhurst, Mr. Kelly, and others. First of all, 
I want to say to Mr. Parmer--I had a chance to read your 
testimony and it was excellent. It was very well done and your 
remarks this morning were all very interesting. I think all of 
us are interested in your program and understand the hardships 
that you encounter when we ask you to do more and give you less 
to do it with. So I am not sure that we need to explore that 
any further, but I just wanted to thank you for the work that 
you and your people do.
    Mr. Parmer. Thank you very much.

                   citrus canker eradication funding

    Mr. Boyd. Mr. Schumacher, I want to thank you for all of 
the work and cooperation you have given me and my office and 
the citrus groves of Florida on the extreme difficulty we have 
had in fighting the canker. Again, I will say as a matter of 
record, Mr. Chairman, that canker is an extreme emergency that 
threatens our entire industry, an $8 and a half billion 
industry in Florida. Mr. Schumacher and I and others met with 
the Secretary and Chairman Young yesterday to try to lay out a 
plan to get it under control. After 4 years we find that the 
canker continues to spread throughout Florida. If we don't do 
something quickly, there will not be a citrus tree left in the 
State of Florida.
    I want to thank you for your cooperation.
    Mr. Schumacher. If I could respond, that meeting 
yesterday--may I put on the record some information on the way 
that we use CCC? Could you permit me to do that?
    Mr. Dewhurst and I revisited that issue this morning, Mr. 
Boyd, on the use of CCC authorities where there is an emergency 
declared to provide assistance to APHIS for the eradication, 
for example, of citrus canker. Mr. Dewhurst assisted me in 
describing exactly how that works. But I just wanted to put on 
the record how we use CCC authorities to assist when, for 
example, the apple industry or the citrus industry or others 
experience major crises and how the CCC authority is working. 
With your permission----
    Mr. Boyd. Certainly.
    Mr. Dewhurst. Mr. Boyd, under the law, which is contained 
both in our appropriations act as well as in substantive law, 
the Secretary has the authority to use any funds available to 
the Department to arrest and eradicate diseases and pests that 
constitute a threat to American agriculture. Historically we 
have used that authority to gain access to Commodity Credit 
Corporation funds because the use of CCC funds does not force 
us to reduce any other program in order to meet the emergency.
    When the Animal and Plant Health Inspection Service 
believes they have such an emergency that would qualify for 
that kind of treatment, they prepare two sets of documents. One 
set of documents is called an apportionment request. That is a 
fancy term that simply is their request for money which they 
send to the Department and we subsequently send to the Office 
of Management and Budget. They are required to lay out what 
they think the need is, why they think they have the need, and 
what the emergency is. The second set of papers they prepare is 
an emergency declaration. Once the funding is approved and the 
Secretary designates it as an emergency, we proceed to try to 
eradicate the disease. Historically the process between the 
Department and OMB takes about 2 weeks' time. We have had 
fairly good experience in terms of feedback. In the last month 
or so we have had more of these than we have ever had before. 
We are carrying six emergencies this year. We carried nine last 
year. In my history we would have one or two a year.
    So the system is a bit overwhelmed. So far this year there 
has been approval to use over $124 million in Commodity Credit 
Corporation funds to deal with the six emergencies that we have 
on the books, and obviously we are looking at future needs in a 
lot of these areas so we will be needing to do some more work.
    Mr. Schumacher. Mr. Chairman, we would be very pleased to 
work with your committee and the committee staff to make sure 
this gets done on a prompt and timely basis using the 
authorities of the CCC, which I am the president of. This is 
such a serious issue not just in Florida but also in California 
and elsewhere. We have real problems and it would be very 
timely to work with OMB and your committee on this issue.
    Mr. Skeen. We appreciate that.
    Mr. Schumacher. I didn't want to take Mr. Boyd's time, but 
I just wanted to get it on the record because it is so 
important.
    Mr. Skeen. Mr. Latham.
    Mr. Nethercutt. He is yielding to me, Mr. Chairman, if that 
is all right.
    Mr. Skeen. You two have got a game going. Go ahead, Mr. 
Nethercutt.

                            export sanctions

    Mr. Nethercutt. Thank you, Mr. Chairman. Welcome, 
gentlemen. I think the key to agriculture success in my part of 
the country as well as the rest of the country is open markets. 
We have introduced legislation that would lift sanctions on 
food and medicine, H.R. 3140. We sent a letter to the Speaker 
of the House with 220 names on it, Democrats and Republicans, 
saying let's take this up this year, Mr. Speaker. Our hope is 
we can do that.
    What is your position on the issue of lifting sanctions of 
currently imposed sanctions on food and medicine so we can open 
markets around the word for our farmers?
    Mr. Schumacher. I am going to ask Mr. Galvin to join us, 
but the key is we have taken a very aggressive position in the 
Administration. I think the President has stepped out very 
smartly on getting rid of most of the sanctions by executive 
order. We have very, very few left and most of those are--in 
fact all of those are congressionally mandated. Tim, do you 
want to join us and walk him through the sanctions? Because I 
think this is an issue that people are confused about in other 
parts of the country. There are very few sanctions on food and 
medicine and those are congressionally mandated. Tim.
    Mr. Galvin. Yes, Mr. Nethercutt. I don't believe that we 
have taken a position, the Administration, on the legislation 
that you have proposed but we would be happy to take your 
request back to the folks in the interagency process and see if 
we could get a response for you.
    [The information follows:]

                               H.R. 3140

    The State Department's Sanctions Policy Office indicated 
that although it has reviewed similar legislation including 
H.R. 212, H.R. 17 and H.R. 817, it has not reviewed H.R. 3140. 
The Committee's interest in H.R. 3140 was expressed to the 
State Department personnel by the Foreign Agricultural Service 
as well as the need to expedite implementation of the 
interagency review process on legislation.

    Mr. Nethercutt. I would appreciate it. I think if nothing 
else it sends a signal to agriculture exporters. My State 
exports 90 percent of its wheat overseas. It would send a 
signal and would have a price impact benefit on the current low 
prices that we are seeing today. I would appreciate it if you 
would do that.
    The other comment that I want to make is for the last 7 
years of this Administration I think there has been an 
opportunity that has been lost. That opportunity is to 
reconfigure USDA and the foreign marketing functions within 
USDA and the State Department and Treasury to try to adopt some 
kind of a single desk mentality that allows us to compete in a 
world market. Whether we like it or not, it is a world market. 
We are being beaten out by Australia in the last two sales to 
Pakistan. That is about $400 million, if I am not mistaken, of 
income that is going to go from that country to Australia; that 
is, Pakistan to Australia, instead of the United States. I know 
there is transportation differentials that impact on our 
ability to secure a sale, but my hope is that the next 
President and the next Administration will look very seriously 
at this idea that we better start coordinating our resources in 
our government, the foreign policy making apparatus as well as 
the USDA mission of trying to open markets around the world or 
else we are going to lose sale after sale after sale to these 
more saggressive Canadian and Australian governments as we try 
to compete in world marks.
    What happens in my judgment, Gus, is we can't compete in 
Iran, we can't compete in Iraq for sales of wheat but Australia 
can. We can't compete in Cuba on our peas and lentils and other 
commodities but Canada can. So they will jack up price in those 
markets that we are not competitive in and they will get sales. 
And we will try to go into Pakistan, for example, and compete 
and we will lose. They will undercut us whether it is 
transportation costs or others. It is frustrating to farmers. 
To the person, young farmers in my district and old farmers, 
are saying lift sanctions, pursue the USDA to try to get more 
aggressive on the marketing side and the credit granting side 
and not let the State Department frustrate the process, or the 
Treasury Department. I am maybe speaking to the choir a little 
bit here, but to get around to my question, I wish that you all 
had done something over the last 7 years of this Administration 
to really aggressively move in that direction. I haven't seen 
it happen.
    So I will give you a chance to comment and give us your 
best advice as we try to formulate policies as best we can 
through the budget process, even though we are not supposed to 
do that, but I think is advisable that we do.

                     need for additional resources

    Mr. Schumacher. I appreciate those comments, Mr. 
Nethercutt. We have put up a very strong budget. Hopefully when 
you pass China NTR we are going to need additional funds to 
promote our products into that extraordinary market in the 
future, particularly in wheat. They bought 50,000 tons of 
wheat. Hopefully they will buy citrus and some poultry but it 
is a big, diverse market. We have put a budget up that is 
aggressive. And frankly to be quite honest, Congress has cut 
the Foreign Agricultural Service budget. We need to work 
together to get our budget back in shape on the foreign 
agriculture side, not just to help on the food aid but on the 
trade promotion. We have some proposals that I have submitted 
in the President's budget to get us back in shape.
    I believe you and Senator Murray have some legislation 
pending that will assist in that. Hopefully that will pass and 
we can get this back in shape. When I was commissioner in 
Massachusetts we had $200 million in the Market Access Program. 
That was very helpful.

                   coordination of marketing efforts

    Mr. Nethercutt. How soon could that be? That is not my 
point. My point is this coordination between the agencies of 
government that frustrate a quick response to the marketplace. 
Canada does it, Australia does it. They sit in a room and the 
State Department guy is here and the Treasury guy is there and 
they say let's go get this market. I don't see that happening 
in our government in our USDA and so I basically say let's try 
to work in that direction. That is what I am looking for.
    Mr. Schumacher. Let's take Australia. They are coming in to 
see me this afternoon. They are pretty grouchy about this food 
aid that we have got over there. They are flying all of the way 
from Canberra to grouch at me this afternoon on food aid.
    Mr. Nethercutt. They have a desk here and they are buying 
our wheat. Talk about aggressive, they are in here looking at 
the markets. They have an office here in our country.
    Mr. Schumacher. When we used GSM to help Korea get through 
a food crisis they called me an avaricious looter. That is 
pretty aggressive.
    Mr. Nethercutt. God bless you. Go get them.
    Mr. Schumacher. I will come and visit you to discuss how 
the three agencies are getting better organized 
administratively. We sent a very strong letter to the State 
Department on the barley issue. The State Department has been 
terrific in supporting some of our initiatives. I would like to 
visit with you a bit more on your ideas.
    Mr. Skeen. Mr. Hinchey.

               improving disaster assistance to producers

    Mr. Hinchey. Thank you, Mr. Chairman, and good morning, 
gentlemen, and thank you for your testimony. Thanks for the job 
that you are doing. I think that in many ways the actions that 
you take represent the best of the United States to foreigners 
and foreign countries around the world. You show the kind of 
benevolent attitudes that we have and the generosity of the 
American people in a palpable way, a way that means something 
to people at the most fundamental level. And so I want to 
express my appreciation to you for the jobs that you do in that 
regard. I think the American people are very proud of the work 
that is going on there.
    You noted in your testimony, Mr. Schumacher, that cash farm 
income is projected to be at its lowest level since 1986, and 
that the Administration's focus during the past 2 years has 
been to provide some $15 billion in emergency support for 
farmers who have suffered price and production losses. Much of 
that is necessary. But you also note that this assistance is 
not well targeted and those producers who need it most often do 
not get the aid that they need. In other words, the most money 
went to the farmers who needed it least. Small farmers who are 
working on very thin margins, very thin incomes, often are left 
behind. I am wondering what you think we ought to be doing 
about that to help get the effort where it is most needed?
    Mr. Schumacher. First of all, this budget, with the 
Conservation Security Program and some other initiatives on 
cooperatives and market support is a different budget than we 
have presented or the Congress has passed before. We feel that 
we can't lurch from disaster to disaster. We need to give some 
advance notice and some security to farmers that they can have 
in hand when they visit with their bankers. We also need a 
national policy.
    I think that there is desperation in the heartland. There 
is also desperation in California, New York, New England, and 
Florida as well among the horticulture industry. I mentioned 
about the apples and cranberries--they are in terrible shape--
and Mr. Boyd's orange industry in Florida. I think the 
Secretary is pushing in this budget with the President's 
tremendous support a more national program to help all growers, 
including small farms. We just announced the organic standards 
and we are working with crop insurance. We have a much wider 
coverage now on crop insurance--140 crops. It doesn't work as 
well as we would all like it to. Ken and I are working very 
hard to make sure it works for all farmers and we hope that our 
crop insurance proposals will pass as well.

                       specialty crop assistance

    Mr. Hinchey. I very much appreciate that. I know that other 
members of this committee do as well. There are a number of us 
who represent agricultural districts where the primary crops 
are so-called specialty crops, vegetables, fruits, even things like 
nuts, berries, silviculture, flowers even and things of that nature, 
vines. Very little, actually, of the aid that comes from the government 
goes to those kinds of farmers. I am going to be offering an amendment 
when the Appropriations Committee meets later today, that will provide 
$150 million in supplemental disaster assistance for specialty crop 
growers. It is a modest amount of money. I am doing this because these 
people are not getting the aid that they need. If you have a problem in 
Washington State with apples, the apple farmer doesn't get the help 
that he needs. The same is true in New York and other places. I wonder 
what the attitude of the Administration or the attitude of the 
Department might be with regard to an initiative like that.
    Mr. Schumacher. Certainly, I think the Secretary has made a 
number of speeches indicating that we need a more national 
policy. We met with Mr. Boyd and Mr. Young on the citrus 
canker. I have been in California. I have gotten e-mails from 
Washington State on apples. It is not in our budget but 
clearly, as I testified, things are not good, not just in the 
heartland crops, in soybeans and rice, cotton in the Southeast 
and throughout the country, but in the specialty crops as well. 
Clearly if you wish to put in some money we would administer it 
expeditiously. It is not in the budget, but given the 
Secretary's keenness to move to help all of agriculture I am 
sure we would move that very quickly if that were to be 
included.
    Mr. Hinchey. Is it an idea that you would support, just the 
idea of providing money for specialty crop disaster assistance?
    Mr. Schumacher. Yes, sir. Because we saw last year in the 
disaster program that in the terrible drought in the mid-
Atlantic States, the Hurricane Floyd impact in North Carolina, 
and the worst drought in 100 years in some of the States like 
New York, Pennsylvania, Connecticut and New Jersey, farmers 
felt that their specialty crops did not get adequate support. 
There were 200,000 farmers in that area from North Carolina to 
Maine, Ohio to Maryland, and they feel they would like to 
participate in some of these programs as well, and perhaps your 
amendment would be helpful to them.
    Mr. Hinchey. So the idea of providing assistance to farmers 
in those kind of situations is an idea that would be well 
received within the Department?
    Mr. Schumacher. I certainly would administer it very 
expeditiously. We would like to look at it a little bit and we 
could work with your staff a bit on some of the technicalities 
so we make sure it gets to the right people, but given the 
importance of specialty crop agriculture throughout the country 
and the crisis staring at us for a variety of reasons, whether 
it is pests, drought, flood, or low prices, we would certainly 
look at that very carefully.
    Mr. Skeen. Very good.
    Mr. Hinchey. Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Dickey.
    Mr. Dickey. Mr. Secretary Schumacher, how are you? I want 
to ask you a question and Mr. Kelly and Mr. Galvin. Is Mr. 
Galvin here?
    Mr. Schumacher. He is indeed.
    Mr. Dickey. Then I am going to have to leave. I have to be 
somewhere at 11:30 and I apologize for that. But I get pushed 
back so much because I am an inferior member of this committee.
    Mr. Skeen. Superior.

              status of discrimination lawsuit settlement

    Mr. Dickey. Superior, I mean, excuse me, okay. The first is 
about the lawsuit and the black farmers' lawsuit. At your 
request I went over and talked to the employees who you have 
pulled together to work on the filing of the claims. Their 
dedication and effort were certainly obvious. I want to ask you 
to please state for the record what the status of these claims 
are and maybe what the picketing was about that just recently 
took place and whether or not we are still on track as we 
discussed. I am not going to be able to listen to your answer, 
so if you would hold that if you will.
    Mr. Kelly, the pulling of all of these people together has 
cost the USDA money and I would like you to outline, if you can 
when your turn comes, as to what expense it is and where it has 
come from and how much--what the total is and what the 
breakdown is, if you know.

                            emergency loans

    Also, Mr. Kelly, I would like to ask you about the gap that 
we have in trying to get the benefits to the owners of the 
chicken houses in my district. We have done a lot of things as 
far as burying the animals, the dead birds and removing the 
debris. Now we have the problems with the loans, the emergency 
loans. If we need to do something in emergency supplemental, I 
would like to have you comment on that as well.

                               embargoes

    Mr. Galvin, I would like to ask you about the embargoes and 
what your opinion is on the embargoes and whether or not we 
should--whether or not it is your recommendation or the USDA's 
recommendation to remove some of the embargoes, particularly in 
Cuba.
    Thank you. I apologize for having to leave.
    Mr. Schumacher. We will get the answers to you very quickly 
for the record.
    [The information follows:]

                  Settlement of Discrimination Lawsuit

    Individuals can settle their claims via one of two 
distinctly different routes, which we refer to as Tracks A and 
B. On Track A, the decisions on the claims are made by the 
adjudicator. Claimants who prevail on this track receive 
$50,000 cash, debt relief on loans identified by the 
adjudicator, and priority consideration for 5 years for one 
operating loan, one farm ownership loan, and one inventory 
property. On Track B, decisions are made by an arbitrator after 
an oral hearing lasting no more than 8 hours, during which both 
the class member and USDA can present evidence. There is no 
limit to how much a claimant who prevails on this track can 
receive.
    As of March 1, 19,373 Track A claims have been received. Of 
these claims, 16,831 have been sent to the adjudicator for a 
decision. The remaining 2,542 Track A claims will be forwarded 
to the adjudicator by mid-April. The adjudicator has decided 
10,540 of these cases, with 60 percent of the decisions being 
in favor of the claimant. In terms of payments made under Track 
A, 1,840 checks have been paid that total $92 million.
    As of March 1, 144 Track B claims have been received. We do 
not know the number of claims presented to the arbitrator; 
these are handled by the Department of Justice. One payment has 
been made in the amount of $600,000.
    In addition to the above claims received, USDA is awaiting 
information on the status of approximately 2,300 additional 
claims. Some of these claims were sent to the facilitator with 
incomplete information. Some claims are late but are being 
reviewed by the arbitrator for possible inclusion pursuant to 
the limited exception described in the consent decree.

                   Administrative Costs of Settlement

    Estimated FY 2000 Farm Service Agency (FSA) administrative 
costs for Consent Decree activities related to the Pigford vs. 
USDA lawsuit are $19.4 million, excluding contractor costs. 
This consists of both field level (primarily State and county) 
staff-year costs, as well as the associated travel and per diem 
costs. We estimate that the full-time equivalent (FTE) of 
almost 240 field level staff-years will be used during FY 2000, 
at a cost of approximately $14.3 million. About 80 percent of 
this estimated staff-year usage will have been expended by the 
end of March. This is not an out-of-pocket cost because we are 
using existing agency field level employees to do the work at 
Headquarters and in the field. However, this activity has 
necessarily diverted them from their normal duties of loan 
making, loan servicing, and other ongoing FSA workload. In 
addition, FSA estimates the amount of travel and per diem costs 
of FSA employees to assemble and document claims at 
Headquarters to be approximately $5.1 million. This excludes 
associated overtime.
    It should be noted that these are FSA employee-related 
costs. FSA is also funding unbudgeted adjudication, litigation 
support, and independent monitoring costs--all of which are 
classified as contractor costs--of approximately $12.9 million 
this fiscal year.

                            Emergency Loans

    Family farmers who have suffered damage to their chicken 
houses may be eligible to receive low-interest emergency loans 
for the cost of repairing or replacing the affected property. 
The size of the emergency loan is the amount required to repair 
or replace the structure with a building of like size and 
standards that meets all applicable code requirements. The 
statutory loan limit for emergency loans is $500.000.
    Inquiries have been received regarding the eligibility of 
producers who did not have hazard insurance on chicken houses 
which were damaged by the storm. The statute prohibits making 
emergency loans to producers for repair and replacement of 
chicken houses unless the property was covered by general 
hazard insurance at the time of the disaster. It has been FSA's 
policy to provide assistance to producers who had no insurance 
on buildings if they can demonstrate such insurance was not 
available.
    Adequate funding is available for emergency loans in fiscal 
year 2000.

                               Embargoes

    Under President Clinton's April 28, 1999 announcement of an 
economic sanctions reform policy, American farmers and ranchers 
are now able to sell their agricultural commodities to Iran, 
Libya and Sudan, despite sanctions that continue to forbid 
trade in other goods and services to these nation. Each 
proposed sale is examined on a case-by-case basis. If certain 
criteria are met, they are allowed to go through.
    This change is guided by the Clinton Administration's 
general belief that food and other human essentials should not 
be used as instruments of foreign policy. When it comes to 
monitoring rogue nations and combating international terrorism, 
we will continue to be as vigilant as ever. But we have found 
too often that sanctions on food and medicine have no influence 
on the behavior of governing regimes. Instead, they victimize 
vulnerable, citizens, who are denied basic tools of survival.
    In the case of Cuba, prior to the President's April 28 
announcement, the United States modified its long standing 
prohibition on trade with Cuba to allow for exports of food and 
medicine to private enterprises, subject to U.S. licensing 
procedures. However, since Cuban trade is largely conducted by 
government organizations, the level of U.S. agricultural 
exports is quite limited.

    Mr. Skeen. Mr. Farr.

                     assistance for specialty crops

    Mr. Farr. Thank you, Mr. Chairman. I want to echo the 
concerns by Mr. Hinchey, those of us who represent specialty 
crops. And I think my main question will be in your four-point 
program that you outlined to the committee; how do you envision 
specialty crops benefitting from market access from the credit 
lending program and so on? These are relatively group layers in 
the field but when it is fresh to market and their access they 
are really catching on. They have never really used the help of 
the Federal Government before. They are very concerned or 
interested in how they can get access. In fact, if you could 
even have the Department print up something, kind of a short 
bulletin or newsletter or just a memo for us to circulate, it 
would be very helpful.
    Mr. Schumacher. I will do that, sir. First of all, I 
appreciate Mr. Hinchey and his enthusiasm for getting a more 
balanced program in. I think across the board we are seeing 
specialty crop producers wanting further access. If you were to 
pass the $600 million Conservation Security Program in our 
budget, all the specialty growers around the country who 
already practice integrated pest management or provide buffers 
or reduce their chemicals and practice organic agriculture 
would get a payment for undertaking those without cost share--
very important.
    The farmland protection program in the budget at $65 
million would be very helpful particularly in your district and 
Mr. Hinchey's district where farmers are paying far too much 
for land rent.
    I visited Michael Barbosa with you some years ago, and I 
kept in touch. He was telling me that 25 percent of his 
strawberries go to Japan but he is paying an extraordinary 
amount of rent. If he had protected farmland we could pull the 
development rights off and get that rent down to where he could 
make a decent living.
    Mr. Farr. In the Salinas valley agricultural lands now run 
for $35,000 an acre. They say you can't buy it, you can only 
inherit or marry it.
    Mr. Schumacher. I think you indicated in your report the 
other day something like 240 crops----
    Mr. Farr. 85 crops.
    Mr. Schumacher. They misspeak a lot.
    Mr. Farr. $2.4 billion in sales?
    Mr. Schumacher. It is very large. The Market Access 
Program, if you were to pass our proposal to use unexpended 
balances for market promotion and for food aid, particularly 
market promotion, we could continue to help the Michael 
Barbosas get their strawberries into Osaka. Tomatoes, we made a 
major breakthrough and are now shipping 600,000 cases of 
tomatoes through L.A. Airport by air to the sandwich makers in 
Japan, a whole new market. Mr. Seng has done a wonderful job of 
providing MAP for that. We need more trade promotion money, we 
need to get the farmland protection program passed. We are 
working much more on crop insurance. For example, on organic 
agriculture there are two types of crop insurance we are 
working on--full farm, which would be very helpful, and also 
some organic riders that will help your producers as well. We 
would love to work with you more to find what else we can do to 
help specialty growers.
    Mr. Farr. Time is limited. Perhaps what would be best--we 
will support you on your financial requests. I am committing to 
that because I think they are wise investments. But it would be 
very helpful for us and the whole committee if you could just 
outline what these programs are and how people who have never 
before had access to them could apply for them.
    Mr. Schumacher. We would be very pleased to put out a 
bulletin----
    Mr. Farr. Kind of an outreach piece to say these are 
available, if you are interested this is how you would do it. 
To make it available to committee members I think it would be 
very helpful rather than just testifying on it.
    [The information follows:]

            Obtaining Information on U.S. Agricultural Trade

    The Foreign Agricultural Service (FAS) produces a vast 
array of trade information, virtually all of which is available 
from its homepage on the worldwide web: http://
www.fas.usda.gov. The FAS homepage includes the latest 
publications, trade data, attache reports and information on 
USDA export programs, food aid and technical assistance 
activities. The homepage also includes information about 
available exporter counseling services, trade shows, trade 
leads and foreign buyer lists. Also included on the homepage is 
information on exporting specific commodities to specific 
countries with a searchable import and export trade database. 
Finally, the latest information on FAS trade policy activities 
can be found on the homepage. This includes resource material 
on international trade agreements and links to current import 
regulations and staff schedules.

    Mr. Schumacher. One other issue that would be helpful is 
farmers markets such as those in the Dominican Republic, but 
which are also rapidly expanding in this country--about 3,000 
now. We have these little coupons that go out. Also for the 
small farmers coming in with limited resources, that is a good 
way of getting started. We are trying to push both domestically 
and internationally help for the specialty growers.
    Mr. Farr. It was brought to our attention this week in the 
School Lunch Program now that the certified organic ruling has 
been made that these commodities are now available, can be 
purchased by the purchasing programs. We have given--for food 
safety we have given legitimacy to that whole standing of 
specialty produce.
    So I think you are going to see a whole new--we have a lot 
of traditional growers that are growing organic now because 
there is such a big market for it. I think that market is going 
to be expanding. Certainly with this new rule it offers 
opportunity for export, opportunities for commodity purchasing 
and you are going to see a lot of people moving in that 
direction.
    Thank you very much. On time.
    Mr. Skeen. On time. Mr. Latham.

                          staffing reductions

    Mr. Latham. Thank you, Mr. Chairman, and welcome, Mr. 
Secretary, and everyone else. I guess I have some concerns 
about the statement about cutting funding. In your budget request last 
year you cut staff all the way through and basically we complied, I 
think, with your request to reduce staff. So you said, ``Congress cut 
that.'' It was per your request.
    Mr. Schumacher. You did cut a bit more FAS and RMA than we 
requested.
    Mr. Latham. I don't think on staff. Your request cut staff.
    Mr. Schumacher. We share the pain on both sides.

                               ldp rates

    Mr. Latham. That is fine. We are good at sharing pain 
around here. I guess one question I have and I asked about it 
last year, there was considerable talk about making adjustments 
to the LDP rates and to resolve the disparities in Iowa 
compared to other States and other discussions still continuing 
and why haven't any changes been made?
    Mr. Schumacher. May I ask Mr. Shackelford if he could 
address that question.
    Mr. Shackelford. I think that we found last year we had 
much fewer disparities between the different LDP rates. There 
continues to be a problem that loan rates have not been 
adjusted in certain commodities between State and county lines. 
We have done a much better job of at least matching the market 
prices. The Secretary will again consider the loan rates this 
year. However, among the concerns he felt last year, one of the 
serious problems was that if he were to adjust loan rates, loan 
rates would go down in wheat, for example, in 67 percent of the 
counties. There was a proposal for a uniform national LDP rate. 
However, there was a significant cost in that. There were 
concerns about the uncertainty of that. I am sure it will be 
considered again. It was certainly not adopted last year.
    Mr. Latham. As you are aware, my district borders with 
three States and it cost Iowa farmers about $183 million last 
year. Just because they are in Iowa and not in one of the other 
three States, there is a real equity question here. I would 
hope that we could address that just ridiculous inequity.
    I guess a question that is of great concern to a lot of us 
in the Midwest is with corn and soybeans and the GMO situation. 
It appears that we have kind of lost the battle in Europe and I 
am very concerned about what is happening in the U.S. We are 
seeing a trend to some market discrimination I think within the 
U.S. I just wondered if you are doing anything as far as 
stemming the disinformation with this situation that is going 
to have real consequences for us?

                       international gmo concerns

    Mr. Schumacher. The Secretary has taken great leadership. I 
have been visiting Europe. The Secretary is right now in Europe 
talking to Mr. Fischler on this issue as we speak. It has been 
very difficult in Europe. Not only are there activists but 
there are also supermarkets who have somehow stepped in front 
of this.
    If I may just take 30 seconds more, it does concern me as I 
have seen the extraordinary environmental benefit of some of 
these technologies on cotton. They have gone from 12 sprays to 
one spray. In soybeans, you know in your own State in your own 
operations the extraordinary environmental benefit. One little 
example. A friend of mine just visited northern Italy where 
they are doing two and three plowings and applying enormous 
amounts of chemicals on their oilseeds. The amount of 
environmental degradation that must be taking place in the Po 
Valley by not using no till, by not using these new techniques, 
I think our European friends have to wake up that this is a 
technology that is going to extraordinarily improve the 
environment of their countryside. They can't spray and spray. 
They should use some of these new techniques and learn from 
your farmers and some of these new technologies. Developing 
countries, they have got to use that if they are going to feed 
the world.
    We have spoken about Mr. Borlaug, a Nobel prize winner, and 
Gordon Conway. It is time for us to continue to step up and 
educate consumers and producers that this is not only good for 
the environment, but it is safe and it is going to be good for 
the future of our children, the European children and the 
children that desperately need the food overseas.
    Mr. Latham. I couldn't agree with you more. We have got to 
somehow convince--it is not the mainstream environmental 
community, but there are some extremists out there and I will 
never understand their justification. Because, if you want to 
talk about preserving the environment and using less 
pesticides, using less fertilizers, having clean water, 
providing abundant food for the starving world, a great portion 
of the world, it just makes no sense.
    I guess my time is up, Mr. Chairman. Thank you.
    Mr. Skeen. Ms. Kaptur, we are being summoned across the 
hall. Would you mind taking over the chairman's position?
    Ms. Kaptur [presiding]. All right, Mr. Chairman.
    Mr. Skeen. If you don't hear from us in a day or two, 
well--thank you.
    Mr. Farr. May I have a follow-up on the comment on the GMO 
issue? I have been meeting with a lot of people and we need 
more transparency. We are not going to gain any consumer 
confidence and what is going to happen is they are going to 
start regulating this at the local level like they regulate 
pesticides. It is going to really foul it up. People don't 
trust anything in these boxes. Academia people have got to get 
involved. And we can't do it, you are absolutely right. There 
is a real concern out there and we ought not to dismiss it as a 
bunch of people off the wall on it because they are gaining 
consumer confidence and that is because we are not transparent.

                     equity in emergency assistance

    Ms. Kaptur. Mr. Schumacher, I believe I am next in 
questioning. I wanted to reiterate something on page 1 of your 
testimony where you talk about all of the emergency assistance 
that has been made available to farmers across our country. It 
has been quite expensive and not well targeted. I couldn't 
agree more with that. And I am hoping that the combination of 
initiatives that the Administration is seeking this fiscal year 
will emphasize not just efficiency but equity. That I believe 
has been a major problem. Mr. Hinchey, and I know Mr. Farr and 
Mr. Boyd, have talked about the lopsided nature of assistance 
that has gone out, many segments of agriculture not being 
covered. It is really amazing to look at the statistics from 
last year. Five congressional districts received 20 percent of 
the emergency assistance and many farmers were getting well 
over $100,000 when some that have gone under got like $1,000. 
Both in their formal presentation and on that chart, you talk 
about ad hoc assistance for farmers. One of the areas in our 
region, for example, that has been really hard hit is hog 
production. The most any one of those farmers got out of any 
program was $1,000.
    I just really wanted to urge you to take a look at the vast 
array of production across this country and look at the equity 
issue. I know that you are trying to do that. That is really a 
statement for the record. I don't have a question there. I am very 
concerned about the formulas and about who is being helped and who is 
not being helped, particularly small and medium sized operators who are 
going under at record rates. This is on our watch.

                          increasing food aid

    I wanted to say relative to farm prices, our silos are full 
all over the country. We talked before about the tremendous 
efforts that have been made to quadruple our shipments of food 
abroad to clear markets here at home. Why can't that be 
quintupled? Why can't that be sextupled? Why are we frozen at 
the quintupling or the quadrupling rate this year compared to 
past years? Why haven't you asked for additional authority this 
year?
    Mr. Schumacher. We have some carryover from last year on 
P.L. 480 because we were so aggressive with the 416(b) program. 
That does give us quite a bit of flexibility on food aid 
because a significant part of the food aid that we show you on 
the chart did come from the presidential initiative on wheat 
and of course on the Russian initiative we did last year. If we 
were to quintuple food, that would take it from 9 million to 45 
million tons. That would probably really displace an awful lot 
of commercial sales. We want to be very careful to look at 
where the real emergency humanitarian needs are in many parts 
of the country, as Mr. Parmer has indicated in his 
extraordinary work with hungry people. But I think we are 
satisfying, where there is real need, most of the humanitarian 
needs but also looking where we can monetize proceeds to help 
on these small projects that assist the poor women in different 
countries.
    Going to quintuple I think would be difficult. It would 
displace commercial sales. If you think our Australian friends 
are nervous now, wait until they are asking us to quintuple 
wheat exports. I am not too concerned about my Australian 
friends. I am concerned about feeding hungry people where they 
really need it.
    Ms. Kaptur. When I was at the World Food Program, I talked 
with Ambassador George McGovern. Subsequent to that there is an 
article that appeared in the Post here about taking our 
framework for school lunch programs and adapting that globally. 
And I guess I am asking you to think about ways to move product 
from here at home still feeding hungry people, not disrupting 
internal markets. I think you did a fantastic job of that 
around the world last year, but there has to be a way to move 
more of this product. It is a little--I have a lack of clarity 
and understanding in order to do that whether you need more 
staff, whether you need more authority. You talk about rollover 
that is available this year. This committee wants to help rural 
America and we want to help the world. How do we do that?

                              world hunger

    Mr. Parmer. I saw the article that Ambassador McGovern 
wrote. In fact I have it right in front of me, ``Two hungry 
children, time for lunch.'' I talked with him when I was in 
Rome the last time around. This is a recommendation that I 
think we should take under consideration in places, targeted 
places around the world.
    I am not an agricultural economist, as you know, so I am 
not really as qualified as Gus and his people are to talk about 
the disruption effect that a huge increase in food aid might 
create in our markets. I know as well as you the theory that 
you also have to encourage these countries to develop their own 
agricultural production. You don't want to put so much food aid 
that they become dependent and it discourages them from 
developing their own capacity to take care of themselves and 
their own food security. But is this suggestion of a worldwide 
or targeted humanitarian School Lunch Program something that we 
should look at and review? Yes, I think it is and we are going 
to do that.
    Ms. Kaptur. My time is up and we will move to Mr. Hinchey, 
but I really would encourage you to look at the volume of 
product that we have available in this country. And I know in 
many places we are very short abroad in agricultural staff on 
the ground to identify where we would not disrupt internal 
markets but where we could move product. That goes back to my 
original line of questioning earlier today about who is really 
out there and who isn't out there in the agricultural arena.
    I would like to submit this article by Ambassador McGovern 
for the record.
    [The information follows:]

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    Ms. Kaptur. Why don't you come forward in this cycle with a 
proposal to try this on a demonstration basis? It has already 
been tried in several places, another way to move product and 
to help people desperately in need and to clear markets here at 
home. This committee would very much want to be supportive in 
that. So I am not just saying the traditional programs that we 
have used, but reconfiguring them in other ways as well.

                            budget resources

    Mr. Schumacher. We are using food aid for school lunch 
programs in Indonesia and in Ecuador. But to do the kind of 
things to expand this a bit more, we are very short of the 
resources. Honestly, the Congress did cut the FAS budget the 
last couple of years. I said to Mr. Latham we share the pain. 
But if we are to do this very important work both Mr. Parmer 
and I would both need a few more resources to carry out this 
labor intensive effort.
    For example, I forgot to mention this to the chairman, but 
in New Mexico, Pam Roy in Santa Fe is the godmother of this 
market in San Francisco and Dominican Republic. We are linking 
this backwards and forwards. That requires a bit more 
resources.
    Ms. Kaptur. You have talked about staffing for that 
purpose. What number would you point to, $10 million, $20 
million? What would help in the field?
    Mr. Schumacher. Mr. Dewhurst is going to step on my instep 
if I get too fired up----
    Ms. Kaptur. Just give us a range, give us a sense of what 
we are talking about. There are billions and billions worth of 
food commodities.
    Mr. Schumacher. We need additional resources to do these 
kinds of programs. I leave it to Steve--we need additional 
resources to do this.
    Mr. Parmer. Let me comment from the Food for Peace 
perspective, Ms. Kaptur. We managed 2 billion tons of food last 
year with 24 U.S. direct hire people. Now, I am not going to 
quibble certainly with my agency in regards----
    Ms. Kaptur. Mr. Parmer, what was the total staffing value 
of those individuals, how is that reflected?

                      personal service contractors

    Mr. Parmer. Dollarwise, I would have to get that for you. I 
don't have that in front of me. But one thing that could be 
helpful because I certainly wouldn't want to put myself in the 
posture of complaining about internal agency decisions which 
have already been made, but one thing that could be helpful 
that I think you would like to know is in my foreign disaster 
office, the Office of Foreign Disaster Assistance, we have the 
authority to hire personal service contractors in Washington. 
So we have the ability on the nonfood side of our humanitarian 
relief operation to supplement our staff when needed, when 
there are crises by hiring people on a contract basis. That 
authority--if that authority were granted on the food side on 
Food for Peace it would be very useful to us when we hit these 
peak time periods.
    Ms. Kaptur. Thank you very much. Mr. Schumacher, I know you 
don't want to give a number but I am going to force you to. 
Would $20 million double your operation? Would it be a 10 
percent increase?
    Mr. Schumacher. $20 million would be very helpful.
    Ms. Kaptur. Thank you. I believe Mr. Boyd is next.

                          safety net proposals

    Mr. Boyd. Thank you, Ms. Kaptur. Maybe I should ask you to 
submit answers in writing. Mr. Schumacher, I don't believe that 
the farm program in '96 is working. Across all sectors of 
agriculture we hear complaints and problems and we have got 
market problems, prices, flooded markets. We are in a mess. I 
personally I think--unlike some members of this committee--
don't believe that we are going to export our way out of this 
problem before we lose a lot of our farm production capacity. I 
firmly believe that. And I know that you all are trying to chip 
around the edges here about the farm policy with your budget 
requests.
    I am not going to ask you to answer this for me now, but 
every time that I see reference to your farm safety net 
proposal, the Supplemental Income Assistance Program, whatever 
you want to call it, the most I see on it is one paragraph. You 
have one paragraph here. What I would like to do is if you have 
this, if the Administration has this, specific proposals about 
how that would work because it is my belief that for the 
Congress and this country to buy into something like this we 
are going to have to expand beyond the traditional crops that 
we have had in the past.
    Most of these members sitting around this table have an 
interest in specialty crops. They have talked about it today. 
You have livestock issues that have not been addressed. I would 
like to see some specific proposals and would like to work with 
you on that. Some other members would too. I am going to ask 
you to do that in writing if you have anything, specific 
proposals.
    Mr. Schumacher. We will do that.
    [The information follows:]

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            disaster assistance for ornamental nursery crops

    Mr. Boyd. Now, earlier I praised you for your help in the 
canker and I do appreciate that. When the Secretary was here 
earlier, a week or two ago, I asked him about the January 10 
letter that the Florida delegation, signed by Chairman Young 
and others, Senator Mack and Senator Gramm and some others sent 
to him. There has been no response to the letter as of this 
date. It relates to the emergency appropriations provided for 
nurseries and the crop year designation for nurseries. The 
disaster causing the problem occurred on October 16 instead of 
September 30, so the crop year designation makes it ineligible.
    Could we get an answer to that? I will ask one more time. I 
asked the Secretary and we haven't yet gotten the answer. I 
would like to ask again in a very kind way for that answer.
    Mr. Schumacher. I will ask Keith or Parks to come in----
    Mr. Boyd. I need to know the date we are going to get a 
response to it. We need to keep this dialogue going and right 
now it has become a monologue.
    Mr. Schumacher. This is on the timing of nursery crops, 
correct?
    Mr. Boyd. Yes, sir, I think is your definition of why you 
rejected the congressional directive.
    Mr. Kelly. Congressman, the answer is that we have reviewed 
this with the lawyers and we cannot legally do this with 
regards to the crop that happened after October 1.
    Mr. Boyd. Can you just speak to when we will get a written 
answer to the written letter?
    Mr. Kelly. We will work quickly to get you a written answer 
to that particular letter.
    Mr. Schumacher. Two weeks.
    Mr. Boyd. Thank you very much. If you would put it in 
writing I think it would great. Thank you very much.
    [The information follows:]

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                         administrative support

    Mr. Boyd. Mr. Kelly, you have a tough job. I am glad you 
are at the desk because the next question has to do with your 
shop. The last three appropriations bills that have been done, 
this Congress has funded over $130 million in temporary help 
for the Farm Service Agency. And now we have a request for--I 
am not sure exactly, I know the total request is $77 million. 
Maybe $26 million of it is for temporary help for FSA?
    Mr. Kelly. That is correct.
    Mr. Boyd. We have funded what your request has been in the 
regular cycles. I know we are trying to gear down, but this 
emergency supplemental deal of funding $130 million in the last 
one and a half budget cycles really is not the best way to go. 
I know that we are dealing with all kinds of issues with farm 
crisis and prices and everything and supplemental assistance 
bills, but I would just implore you to make those requests 
meaningful in the regular appropriations bill. You may want to 
comment on it.
    Mr. Kelly. Yes, Congressman. If you are referring to the 
chart that is over there, the $130 million is tied to $6 
billion of emergency programs, 8 programs a year ago and now 
over 20 programs this last year, another $8.7 billion. In 
addition, in the farm loan program we have seen tremendous 
growth, I think a 48 percent increase in the total of all of 
the farm loan program categories. To get those programs out in 
a timely fashion our agency needs a corresponding increase in 
administrative resources. We have suffered through it. When 
some of these things are passed--we can't predict what kind of 
emergency legislation may be passed or what kind of disasters 
may occur before the year is out. It does create one tremendous 
challenge for us to operate. We don't like to come up to ask 
for supplementals but operating with these kinds of one-year 
programs certainly has been a challenge.
    Mr. Boyd. Well, Madam Chairman, I will wrap up. Mr. Kelly 
and Secretary Schumacher, I think your FSA people do a great 
job. We have downsized offices and closed offices and combined 
counties in such a way that now we are about as lean and mean 
as we can get. We are actually down to the bone, if you will. 
It is creating a hardship. I submit to you that as long as we 
have the current '96 Farm Program in place that we will 
continue to have these disaster assistance programs unless real 
markets jump up, and I don't think that is going to happen. 
Your economists say it is not going to happen for the next 4 or 
5 years anyway. So you might as well just plan for it. I think 
you will see it happening. So we have got to either go fix the 
program or figure out that we just want to submit these 
disaster assistance--ad hoc disaster assistance budgets as we 
go.
    Mr. Schumacher. That is why, Mr. Boyd, our present 
proposals in those four themes are trying to plan a little more 
security for your farmers in Florida and throughout the 
country. They can't lurch from crisis to crisis because their 
bankers are not going to allow credit without sufficient 
assurance of government assistance. We need to give a little 
more security on budget to get them through until we can 
rewrite this farm bill.
    Mr. Boyd. Thank you. Thank you, Madam Chairman.
    Ms. Kaptur. Thank you, Mr. Boyd. Mr. Hinchey.

                     assistance for specialty crops

    Mr. Hinchey. Thank you, Madam Chairman. I was listening 
carefully to Mr. Boyd's comments. I couldn't agree with him 
more. I think he makes some very good points. In the last 
several years, a number of disasters have been visited upon 
American agriculture, some of them natural and others imposed 
upon them by the provisions of the '96 farm bill, which has 
been very injurious to agriculture in a variety of ways. 
Response to these disasters requires a lot more flexibility on 
your part, but we in Congress need to make some changes as 
well.
    I want to just return to the issue of disaster assistance 
because I know the Administration's focus during the last 2 
years has been to provide some $15 billion for emergency 
support to farmers who have suffered production and price 
losses. I note that in the census of agriculture specialty 
crops account for 30 percent of the value of crop production 
nationwide. So they are almost a third of the value of what is 
being produced by American farmers today. I am wondering if you 
can tell me how much of the $15 billion in emergency assistance 
we appropriated during the past 2 years was paid for losses in 
nonprogram crops?
    Mr. Schumacher. I will ask Mr. Parks Shackelford to come 
forward. I think it is very small but we may not have that data 
with us----
    Mr. Shackelford. I can't tell you specifically. We can look 
at the disaster assistance. One thing to keep in mind is that 
of that $15 billion a very large portion, close to $8 billion, 
was income assistance and not disaster assistance. But we can 
get for the record the number that has gone to specialty crops 
by your definition.
    Mr. Schumacher. It is pretty modest, I would think.
    [The information follows:]

                Disaster Assistance for Specialty Crops

    For 1998 Crops Loss Disaster Assistance, about $460 million 
out of $1.34 billion was paid for nonprogram crops. All crops 
were included except price support crops. For 1999 Crop Loss 
Disaster Assistance, about $515 million out of $1.29 billion 
went to nonprogram crops.

    Mr. Hinchey. The need for income assistance comes about as 
a result of material factors in the marketplace. It doesn't 
just appear out of thin air. I am saying that some losses were 
because of natural disasters, but some of the provisions of the 
so-called freedom to farm legislation contributed to or brought 
about those conditions that required that financial assistance.
    Mr. Shackelford. That is correct. And unfortunately those 
additional payments don't necessarily go to the producers who 
are suffering the low prices, which is the income assistance 
side.
    Mr. Hinchey. Yes, sir. That is an important point that has 
been made here several times today. So you don't have a number 
today, I didn't expect that you might, but if you could provide 
that number I would appreciate it. And also perhaps tell us how 
much of the $15 billion specialty crop farmers, were eligible 
to receive or may have been eligible to receive. If you could 
do that, I would appreciate it. We know that their losses are 
just as real as those of program crop growers, but I think you 
made the point yourself, Mr. Schumacher, in your testimony and 
I appreciate it, that these people are not getting the 
appropriate level of assistance that they deserve. They are a 
major part of the American agricultural community. Specialty 
crop farmers are making a major contribution to the food and 
fiber that Americans require. Agood portion of their produce is 
going overseas to assist in these feeding programs as well. But the 
farmers are left behind. When it comes to providing help to these 
people--and they don't want very much help, but when it comes to 
providing help for those people in those particular circumstances they 
are left behind.
    I think this is something that we have to change. It is a 
condition that affects agriculture not just in one region of 
the country but all across the country, on the East Coast, on 
the West Coast, and a number of places in between.
    So once again I am just pleading through you for some 
initiatives that may be taken by the Administration that will 
take into mind the fact that you have 30 percent of the value 
of American agriculture coming from these specialty crops and 
they need some attention. We of course here in the Congress 
have to make some changes as well. If we could work together I 
am sure that we could provide the help that these people need 
and deserve.
    Mr. Schumacher. If your amendment passes, we would be keen 
to expedite that on a national basis.
    Mr. Hinchey. Thank you very much.
    Ms. Kaptur. Mr. Farr.
    Mr. Farr. I am going to skip because we have a vote on.
    Ms. Kaptur. You don't want to take the last 3 minutes?
    Mr. Farr. No. Mr. Schumacher is going to give me all of his 
stuff in writing. If I don't take a question now I can take one 
in the future.
    Ms. Kaptur. There are so many more questions but the 
schedule is really erratic this morning. We have a caucus 
across the hall and then at 12:30 the other side of the aisle 
will caucus because we have a supplemental coming up at 1:30. I 
believe I have just been given an indication by the chair we 
will complete the hearing now even though several of us have 
many more rounds of questions.
    We want to thank you, Mr. Secretary, very much for being 
here. Mr. Parmer, thank you so very much. We look forward to 
hearing from you in the days ahead here as we move towards the 
2001 appropriation. You could tell by the members' questioning 
that they are deeply concerned about the condition of rural 
America and a deep concern that your budget may not reflect all 
of the needs that are really out there and that we need further 
consultation in order to decide what is best to do for this 
country and the interests of this country. We thank you very 
much for the submission that you have made to date. I will 
guess that some of us feels it incomplete and we very much look 
forward to working with you in the weeks ahead.
    So again thank you so very much on behalf of the full 
committee. I don't have the gavel in my hand but this committee 
meeting is adjourned.

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                                           Tuesday, March 21, 2000.

                   FOOD SAFETY AND INSPECTION SERVICE

                               WITNESSES

CATHERINE E. WOTEKI, UNDER SECRETARY FOR FOOD SAFETY
CAREN A. WILCOX, DEPUTY UNDER SECRETARY FOR FOOD SAFETY
MARGARET O'K. GLAVIN, ASSOCIATE ADMINISTRATOR, FOOD SAFETY AND 
    INSPECTION SERVICE
STEPHEN B. DEWHURST, BUDGET OFFICER, DEPARTMENT OF AGRICULTURE

                            Opening Remarks

    Mr. Skeen. The committee will come to order. Good morning. 
I wish we had this much rain in New Mexico, but without the 
traffic.
    Today the subcommittee takes up the very serious issue of 
food safety and the administration's fiscal year 2001 request 
for the Food Safety and Inspection Service. The principal 
witness today is Dr. Catherine Woteki, the Under Secretary for 
Food Safety at the USDA.
    Dr. Woteki, I understand that the White House was still 
revising the testimony late yesterday, so I hope that you can 
let the subcommittee know what was changed and why without 
incurring the wrath of the Office of Management and Budget.
    Before I ask you for introductions and your statement, I 
will turn to my friend and colleague, the distinguished 
gentlelady from Ohio Ms. Kaptur, for any opening remarks that 
she may have. I hope that she wasn't driving this morning.
    Ms. Kaptur. It was terrible. Yes, I agree with you, Mr. 
Chairman.
    I want to welcome the Under Secretary for Food Safety, 
Catherine Woteki, and her able colleagues to our subcommittee 
this morning, and we thank her for her service to our country, 
as well as all of the other witnesses as well, and we look 
forward to your testimony.
    I think that your responsibilities are indeed weighty ones. 
We still have the safest food supply in the United States here 
of any country in the world, but we can certainly even do a 
better job, and we are looking forward to the initiatives that 
you discuss with us this morning and detailing a little bit 
about the progress that we have made as a country and where we 
are headed in this important area of food safety.
    Thank you, Mr. Chairman.
    Mr. Skeen. Dr. Woteki, it is all yours.
    Ms. Woteki. Thank you, Mr. Chairman. It is a pleasure to be 
here to testify before this subcommittee this morning. 
Accompanying me are Deputy Under Secretary Caren Wilcox; Mrs. 
Margaret Glavin, who is the Associate Administrator of the Food 
Safety and Inspection Service; and Mr. Steve Dewhurst, who I 
know does not need an introduction to this subcommittee, the 
head of our Office of Budget and Program Analysis.
    Mrs. Glavin and I have submitted written testimony for the 
record, and, as you indicated, Mr. Chairman, we amended that 
testimony and submitted this morning amended testimony. I offer 
to you and to the subcommittee my apologies for this late 
submission of amended testimony, and in my oral statement I 
will indicate to you the nature of the changes that were made 
to the original testimony.
    Before I start, though, I would like to say that the 
administration thanks this subcommittee for its past support of 
our office and to the Food Safety and Inspection Service, 
particularly since 1993, when we committed to reforms to 
improve the safety of meat and poultry here in the United 
States.

                          haccp implementation

    Since I joined the Office of Food Safety in this position 
in 1997, the major priority for us has been implementation of a 
new science-based inspection system. It goes by the acronym of 
HACCP, which I know is familiar to you. That has been our major 
focus and our major emphasis over the last several years. We 
are now seeing the results of that investment, and I would like 
to turn your attention to a chart that Neil Omansky is going to 
be putting up right know.
    Just 2 months ago, January 25, 2000, we reached a major 
milestone in HACCP implementation. January 25 marked the third 
and final phase of pathogen reduction and HACCP rule 
implementation. On this date 3,159 Federal and approximately 
2,300 State-inspected, very small meat and poultry plants 
implemented HACCP. We are pleased to report to you today a 
successful implementation following also on the record of 
implementation of the large and the small plants.
    This chart shows the number of plants that successfully 
implemented HACCP over this 3-year period of time and the very 
small number of plants in which any regulatory or enforcement 
actions were necessary. If you look at this chart, the first 
set of bars on the left indicate the number of large plants 
that began implementation in 1998. The gray bars are those that 
were completely successful in implementation. The black bars 
are those for which there were enforcement actions necessary. 
The second set of bars represents the number of small plants 
that implemented HACCP in 1999. Again, the gray bars show those 
that were successful, in this case well over 2,000, and those 
in which enforcement actions were taken, a very small number, 
13. And the last two sets of bars represent the very small 
plants, those that employ fewer than 10 employees, who 
implemented HACCP just 2 months ago.
    As you can see, the number of plants involved is far 
greater than in the 2 previous years, over 3,000 Federally-
inspected plants and over 2,000 State-inspected plants. You can 
also see the remarkable success of that implementation.

                       salmonella testing results

    A second major result of HACCP has been the reduction in 
the prevalence of Salmonella in raw meat and poultry products. 
Today

we are releasing data from 2 years of Salmonella 
performancestandard testing in the large and small plants. We 
have two sets of tables that I would like to draw your 
attention to. First of all, we are going to be focusing on the 
set of tables on the right that show the prevalence of 
Salmonella in large meat and poultry plants. The table that is 
at the top of that chart shows the four classes of product: 
broilers, swine, ground beef, and ground turkey; the pre-HACCP 
baseline prevalence of Salmonella in those products; and the 
post-HACCP implementation prevalence of Salmonella.
    In the 300 large plants shown on the right there are 2 
years of data represented. And in all of these product classes, 
ground beef, broiler, swine and ground turkey, there are major 
declines as compared to the national baseline established 
before these plants implemented HACCP.
    The bottom panel of this chart on the right shows the 
percentage of complete data sets in large plants meeting the 
Salmonella performance standards. Let me draw your attention to 
the bottom line there, which is the total, and that shows that 
90 percent of large plants meet or exceed the Salmonella 
performance standard.
    Now, the data that are shown on the right are from 1 year 
of Salmonella performance testing in small plants. It indicates 
that the plants have made very substantial progress in lowering 
the prevalence of Salmonella in broilers, ground beef, and on 
cow/bull carcasses. The one exception, however, is the trend 
with swine carcasses where the baseline prevalence was 8.7 
percent. After the first year of HACCP implementation, 
unfortunately, the prevalence of Salmonella is 18.2 percent. 
Now, we expect these data are going to motivate the very small 
number of small swine plants to evaluate their operations and 
implement more effective Salmonella reduction efforts.
    The bottom panel on this chart on the left-hand side; again 
I draw your attention to the bottom line there, the total, 
shows that 84 percent of small plants are meeting or exceeding 
the Salmonella performance standard despite the poor 
performance in the swine plants.
    The third major result that we are seeing from HACCP 
implementation is a reduction in the overall incidence of food-
borne diseases. Just last week the Centers for Disease Control 
released data from their FoodNet active surveillance system in 
their weekly Morbidity and Mortality Weekly Report (MMWR). You 
may have seen the article in the Washington Post on Friday that 
attributed part of the decline in food-borne illnesses to the 
implementation of HACCP in meat and poultry plants. We are also 
seeing through data that the Department of Health and Human 
Services collects under its Healthy People 2000 program that we 
have achieved the objectives for reducing illnesses 
attributable to Campylobacter, Salmonella, E. coli O157:H7, and 
Listeria monocytogenes. As a result of being successful in 
meeting those reductions, we have now set even more ambitious 
goals for the year 2010 under Healthy People 2000.

                          inspection staffing

    Lastly I would also like to note our appreciation forthis 
year's appropriation which provided for an increase in in-plant 
staffing to fill vacant positions.
    There is one more chart that I would like Neil to put up 
for you----
    Mr. Skeen. He is getting his exercise today.
    Ms. Woteki. He sure is. Then he will be able to sit down.
    This is a much easier picture to look at. This shows that 
the staffing levels will increase--these are the in-plant 
staffing--from 7,440 to 7,610. To reach the target of 7,610 
permanent full-time in-plant inspectors, FSIS plans to hire 470 
new inspectors to achieve that increase and also recover the 
losses for attrition as people retire or move on to other jobs. 
As the committee requested, FSIS submitted its first quarterly 
report last month reporting on our status on hiring inplant 
personnel, and that report shows that hiring is proceeding 
ahead of schedule, which is the dotted line that is on this 
chart. Therefore in our first quarter report to you, we are 
ahead of where we had projected to be in the first quarter.

                  fy 2001 fsis appropriations request

    I would now like to turn to our request for fiscal year 
2001, which really is the topic of today's hearing. As for the 
last 3 years, the budget request contains the President's Food 
Safety Initiative. Under that initiative USDA agencies are 
requesting a total of $163.6 million, which is an increase over 
this year of $27.4 million, to support work in several very 
important areas. One is research to eliminate, reduce, or 
suppress pathogens in commodities associated with food-borne 
illnesses, and also to do research on how to control the 
development of resistance to antimicrobial agents.
    A second major emphasis of this initiative is risk 
assessment, particularly risk assessments that support FSIS's 
implementation of HACCP.
    A third major part of the initiative is outreach to State 
and local food safety programs, including the adoption of 
national uniform laboratory standards. We increasingly rely on 
the States as very important partners in improving food safety, 
and these funds represent an important part of improving that 
partnership.
    The last major initiative inside this year's President's 
Food Safety Initiative is implementation of the Egg Safety 
Action Plan, which we can probably refer to later and answer 
any questions that you might have with that action plan.
    The FSIS request is for $687.4 million, which is a current 
increase of $38.3 million. Now, of that $38.3 million increase, 
$11.2 million is for program improvements including $1 million 
to support the U.S. Codex office. The majority, the remainder 
of the increase, approximately two-thirds, is for mandatory 
expenditures. These are funds to cover pay raises, retirement 
and health insurance, and also to support the Federal share of 
State inspection programs.
    Lastly, I would like to emphasize that there are several 
assumptions that are underlying the additional requests for 
program improvements. Mr. Chairman, in response to your initial 
question at the beginning of the hearing about the nature of 
the changes that were made in our testimony, this next point is 
the nature of the change. After consulting with Members of the 
Committee in our courtesy visits that lead up to this hearing, 
as well as meeting with consumer organizations, we felt it was 
necessary to take an opportunity to clarify with the committee 
two very important aspects of our budget request. The first is 
that FSIS will not proceed in implementing the HACCP-based 
Inspection Models Project until the proper evaluations are 
conducted. The second is that FSIS will not proceed in 
implementing changes that involve random inspection of 
processing plants until the proper evaluations are conducted. 
FSIS will not make any permanent changes in inspection until 
the new HACCP slaughter inspection system has been demonstrated 
to be effective and a new rule is presented for public comment.
    Concerning randomized processing inspection, FSIS 
understands that it will have to establish criteria for the 
assignment of randomized inspection schedules and perform a 
risk-based analysis to demonstrate this policy change is 
effective in protecting public health. FSIS is committed to a 
full and complete public dialogue on these policy changes and 
will not move forward unless the risk analysis validates the 
proposed change. Essentially that policy clarification is the 
amendment that was made to my testimony and also to Mrs. 
Glavin's testimony.
    There are three other assumptions that underlie this 
budget. I, in many of the meetings that I had with members of 
the Subcommittee, indicated that we look at this budget request 
for 2001 as being a transition year. HACCP is now implemented, 
and the directions for the future evolvement of HACCP programs 
under FSIS's purview are laid out in this budget.
    This budget request by FSIS assumes passage of S. 1988, the 
New Markets for State-Inspected Meat Act of 1999, that will 
allow for the interstate shipment of meat and poultry products 
produced at State-inspected plants. The fiscal year 2001 budget 
request includes funding for reviews of State programs to 
assure compliance with the Federal program prior to 
implementation of that new program.
    Another assumption is that FSIS has no budget flexibility 
to cover unexpected costs associated with food safety 
emergencies such as product recalls or outbreaks of food-borne 
illness. The fiscal year 2001 budget includes language to 
provide the Secretary with the flexibility to transfer to FSIS 
funds from other accounts necessary for the Agency to address 
unexpected food safety emergencies.
    This budget request also includes user fees. During the 
last session of Congress, the administration submitted a 
legislative proposal to provide the authority to recover 
through user fees the full cost of providing Federal meat, 
poultry and egg products inspection services. Should this 
proposal be enacted, FSIS will cover a total of $534 million in 
fiscal year 2001. This proposal is intended to assure that 
resources are available now and in the future to provide the 
level of inspection necessary to meet demand.
    Mr. Chairman, with that I will conclude my oral statement, 
and my colleagues and I look forward to responding to whatever 
questions you may have.
    Mr. Skeen. Thank you very much, and I think you had a very 
inclusive presentation.
    [The statements of Catherine E. Woteki and Margaret O'K. 
Glavin follow:]

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                       single food safety agency

    Mr. Skeen. Dr. Woteki, you mentioned the 5-year 
comprehensive plan that is being developed by the Food and 
Safety Council. Will there be any discussion or planning for a 
single agency for all U.S. food safety activities?
    Ms. Woteki. The President's Food Safety Council is looking 
at the full range of organizational options. You may be aware, 
Mr. Chairman, that at the request of the Appropriations 
Committee a couple of years ago, the National Academy of 
Sciences undertook a study of the adequacy of our Federal food 
safety efforts, and made recommendations about alternative ways 
in which the Federal agencies could be organized in order to 
improve our performance. These alternatives include 
establishing a council, such as the President's Council now in 
existence, to improve coordination between food safety 
agencies. A second option was assigning a lead agency 
responsibility for food safety throughout the Federal 
Government. A third option was nesting the responsibilities for 
food safety in an existing department reporting to one 
Secretary, and the last option was creating a single food 
safety agency.
    The President's Council is examining that range of options, 
and we will be reporting back to the President in July with a 
thorough analysis of what the implications are of each 
alternative.

                 haccp-based inspection models project

    Mr. Skeen. That is very interesting. There is one aspect of 
this thing that worries me even more. You are doing a great job 
with the people who handle the food and who are preparing it 
for sale and so forth. But once it leaves the store, you have a 
real problem with the way people handle food when it goes to 
the home. I know this is beyond the route of normal inspections 
that you are doing so very well. It is important to get to the 
people in general the understanding that you just can't 
mishandle food.
    But let me ask this: Earlier this year there was a news 
article that was criticizing the food safety practices of some 
of the Federally-inspected plants that provide the poultry 
products to the school lunch program, and some of your own 
inspectors were quoted as saying that they had ``no control'' 
to stop diseased poultry products from leaving these plants. 
Can you explain what actions FSIS has taken to ensure that the 
food products produced at these plants are safe?
    Ms. Woteki. I will give a brief response, and then I would 
also like to ask Mrs. Glavin to comment on that article.
    I believe that the article you are referring to is one in 
which there were criticisms made of an experimental program 
that is now under way that is referred to as the HACCP 
Inspection Models Project. We were deeply troubled by the 
article to which you refer because we don't believe that it was 
an accurate reflection of the nature of that project or of our 
inspectors' responsibilities and the nature of the authorities 
that they have and continue to have under both HACCP and the 
HACCP Based Inspection Models Project. So I would like to ask 
Mrs. Glavin if she could also comment further on this.
    Mr. Skeen. I would be very interested in hearing that, 
because I want to know how you educate news reporters and 
people who write news articles.
    Mrs. Glavin. I am afraid that I don't know how to do that.
    Mr. Skeen. I said it so you don't have to take 
responsibility for it.
    Mrs. Glavin. We do have great concern about that particular 
article because it did confuse and not accurately compare our 
existing inspection system with the new HACCP Based Inspection 
Models Project that we are testing in a number of plants. That 
new project is an attempt to move forward and continue our 
modernization of how we inspect, particularly in slaughter 
plants. Under this project we set standards for food safety and 
other consumer protection concerns, and through inspection we 
verify that plants are meeting those standards. Under this 
project we are able to focus our resources more heavily on food 
safety so that, for example, we do four times the number of 
checks for fecal contamination that we are able to do under 
normal slaughter inspection.
    In addition to the misrepresentations and confusions about 
this project that the article promulgated, we feel the 
allegations are an insult to our inspectors. Our inspectors are 
a work force dedicated to food safety and protecting the 
American public. Our inspectors have the authority to take 
action to ensure that adulterated products don't leave the 
plant. In fact, they are required to take that kind of action.
    As Dr. Woteki said in her oral statement, we are firmly 
committed to a full evaluation of the HACCP Based Inspection 
Models Project and making sure that the data that our 
contractor collects gives us the ability to move forward. We 
won't move forward without the assurance that, in fact, this 
project is going to improve food safety and move us forward by 
giving us more flexibility in how we use our work force. We 
know that change is hard, and many people resist change, 
including in some cases our own employees, but we believe that 
proceeding with this project is the right thing to do.
    Mr. Skeen. Thank you.
    Miss Kaptur.
    Ms. Kaptur. Thank you, Mr. Chairman.

                          inspection staffing

    Ms. Kaptur. I would like to ask, Dr. Woteki, we have heard 
from a number of representatives from industry that there 
appears to be a problem or shortage of inspectors in the 
plants, and I am wondering if this is a problem of funding, or 
is it a problem of recruiting, training, and placing people who 
are capable in those positions?
    Ms. Woteki. Well, it certainly is true that some areas of 
the country have experienced shortages of inspectors. With the 
increased appropriation this year, as I had indicated earlier, 
we will be able to increase the number of permanent in-plant 
inspectors from 7,440 up to 7,610, and are making very good 
progress in that hiring initiative.
    The one thing that we are facing is that it is a very 
competitive job market, and we are experiencing the same 
problems in attracting people into those positions as many 
private sector companies and other government agencies. At 
least the first quarter in hiring was very heartening, and we 
are on track as far as meeting our goal of increasing the 
numbers of in-plant inspectors.

                      data on food-borne illnesses

    Ms. Kaptur. Could I ask you, your testimony states that 
annually in our country the CDC says that 76 million people get 
sick, 325,000 are hospitalized, and 5,000 die from food-borne 
illnesses each year. Do you have confidence in the system that 
CDC uses to present us with those numbers?
    Ms. Woteki. Actually, yes, I do. Much of my career I have 
worked as an epidemiologist, and the techniques that CDC is now 
using to develop those estimates on food-borne diseases are 
very substantially improved because ofthe investment that has 
been made in the FoodNet system. The active disease surveillance system 
is enabling CDC to get a far better handle on the actual incidence of 
food-borne diseases. These estimates are very much improved estimates.
    Ms. Kaptur. One of our colleagues from Pennsylvania got 
deathly sick last week, and we narrowed it down to crab cakes 
or gooey chocolate cake. And he was the only one in the group 
that got ill. This was at a restaurant, not at home. Can you 
tell us a little bit more about those numbers of people who are 
hospitalized? How many of these are due to eating out, how many 
at home? What do we know about what is going on here? What do 
these numbers tell us?
    Ms. Woteki. Among the work that CDC has under way right now 
is further work to better understand those estimates and the 
different types of food products that are contributing to these 
illnesses. The alternative to that is to look at the numbers 
and the sources of different outbreaks. The CDC as well as some 
of the advocacy organizations, CSPI, have done that type of 
analysis. It is very difficult with that data set to which you 
are referring to attribute those illnesses to specific 
products, but that work is under way within CDC now.
    Ms. Kaptur. Is that going to be broken down by geographic 
region, by State? Is there anything other than these gross 
numbers that people can present us with that will give us more 
detail about what these numbers are actually telling us?
    Ms. Woteki. There is quite a bit of work under way in 
FoodNet, such as case control studies, to get a better 
understanding of the food sources of illnesses. There are a 
number of smaller studies that CDC is conducting that are 
helping to provide information about the food sources of these 
illnesses, and also to get a better handle as well on the food 
preparation practices that may be causing illnesses.
    A good example is ground beef and the studies that CDC as 
well as FSIS have done that have attributed previous outbreaks 
of O157:H7 to undercooked ground beef, and more recently that 
have indicated that hamburgers that are purchased outside of 
the home are no longer a major source of food-borne illnesses. 
It leads one to conclude that it is home food preparation 
problems, storage problems, and abuse of products that are 
contributing to O157:H7 outbreaks in hamburgers.
    Ms. Kaptur. Does Mrs. Wilcox have additional information 
that is available there in further response to that question?
    Ms. Woteki. Actually what she has are the data that CDC 
published just last week in the MMWR indicating the different 
organisms that are causing food-borne illnesses, and how those 
have changed since that system was put in place in 1996. We 
would be happy to submit this information for the record.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Ms. Kaptur. Just take 15 seconds, Mr. Chairman. What 
summary information can you give us just based on what you are 
looking at there?
    Ms. Wilcox. I think it is important that there have been 
measurable declines in certain food-borne illnesses as reported 
by CDC last week, particularly in Campylobacter and, also I 
believe, in E. coli; and Shigella. The Salmonella numbers have 
remained a somewhat constant from 1996. They went down for a 
little while, and they went up a tiny bit, and, of course, we 
are looking at those. Those outbreaks were attributed, I 
understand, to certain fresh products that apparently had some 
Salmonella.
    Ms. Woteki. Produce products, not meat and poultry.
    Ms. Kaptur. So we can assume that, based on the charts that 
you gave us and the numbers I have just given you, that the 
rate of illnesses, people who are becoming ill or dying, is 
going down?
    Ms. Woteki. From the active disease surveillance system 
from 1996 to 1999, there is a decrease in the rate from 51 to 
40, so, yes, that is correct.
    Ms. Kaptur. Thank you very much.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mrs. Emerson.

                       country of origin labeling

    Mrs. Emerson. Dr. Woteki, good to see you again. Thanks for 
being here. I am going to bring up the issue of country of 
origin labeling. We have talked about that before, but I want 
to say, first of all, that I have read the report now that you 
have given to me, and before I even start on the question 
period, let me just say that I feel really very confused by 
your report. I don't know that there is anyone here in this 
room--maybe there is, but I don't know that there would be--
anyone here who would disagree that our producers, our ranchers 
produce the safest, most abundant and nutritious and highest 
quality of meat from anywhere in the world. Quite frankly, I 
would personally rather eat meat that was raised right here at 
home because I know that our ranchers do know their business, 
and I have seen surveys that say that 91 percent of consumers 
here in the United States feel the same way. But as I read your 
report that you released in January of this year, it really 
said little about the benefits of the initiative to consumers 
and producers, and actually to some extent very energetically 
and vigorously highlighted the drawbacks.
    So I took that, having read that part of it, to say that 
the FSIS and the administration don't support country of origin 
labeling, but then when I went to the conclusions and 
recommendations portion, you really stopped short of outright 
opposition. So I am confused, and I would like to ask if you 
would try to clear up that confusion and advise thesubcommittee 
of where precisely FSIS does stand on the issue. Do you or do you not 
support country of origin labeling?
    Ms. Woteki. We had an opportunity to have a discussion, as 
you have indicated. I had told you that the report does 
indicate that it is difficult to quantify the benefits, and 
there are some costs that are associated with country of origin 
labeling. You are absolutely correct in the statement of the 
conclusion that we reach.
    The report makes the point that under the current rules, 
processors can voluntarily label a product as a product of USA. 
That is an option that is already available.
    One of the issues brought out in the report is that there 
does not seem to be any indication that there is a food safety 
benefit to consumers from country of origin labeling at 
present. Under Secretary Wilcox has actually been the person 
within my office that has had the primary responsibility for 
oversight of this issue, and she has testified before on this 
subject.
    Would you like to add to that, Caren?
    Ms. Wilcox. Well, Representative Emerson, I believe that 
you are correct in your reading of the report. What the Agency 
did when it was assigned to look at the report was try to make 
a very careful review and also to consult with our economists 
in the Department to look at the pros and cons of country of 
origin labeling, the benefits to consumers, the implications in 
international trade, and the current program that exists under 
AMS for voluntary labeling.
    As you know, certain countries when they export retail 
product to the United States already label their country of 
origin. We believe they do that because they feel they get some 
kind of a marketing benefit. All product that is imported into 
the United States initially is labeled as to country of origin, 
but if it is then further processed the label does not carry 
through to the retail level. The AMS program that was evaluated 
does offer an opportunity for the U.S. industry to label U.S. 
product, and we would like to see that program utilized more.
    Mrs. Emerson. So I take it that you all don't want to take 
a position on this?
    Ms. Wilcox. The Food Safety and Inspection Service's 
primary business is to evaluate whether there would be a food 
safety benefit to country of origin labeling. There is no 
evidence that product with country of origin labeling is any 
less safe than product without labels.
    Mrs. Emerson. Well, I have got several more questions that 
I want to follow up with you not dealing with this just as a 
safety issue. So I will wait my turn, Mr. Chairman, thanks.
    Mr. Skeen. Ms. DeLauro.

                      foodnet surveillance system

    Ms. DeLauro. Thank you, Mr. Chairman, and welcome, Dr. 
Woteki, Mrs. Wilcox, and Mr. Dewhurst. I am glad to be here 
with you today. Connecticut is one of nine States that is 
included in the FSIS's successful FoodNet initiative. We 
believe it to be a successful initiative. Tell me about what 
the program would gain from expanding to more than nine States.
    Ms. Woteki. FSIS has supported CDC's development of the 
FoodNet active surveillance system. At present, with the nine 
areas of the country that are participants FoodNet covers about 
28 million people, roughly about 10 percent of the population. 
Clearly the accuracy of estimates coming out of FoodNet in the 
future will be improved as more people are included in the 
catchment areas. But currently FoodNet at this size is actually 
doing a very good job. This is also a rather technical area to 
which I think my colleagues at CDC might also wish to respond 
to.

                           fight bac campaign

    Ms. DeLauro. We will do that just to see if there is a 
better way of trying to deal with the statistics it covers 10 
percent of the population, but what could we do if we were able 
to deal with a greater, more substantial portion of the 
population?
    You mentioned in your testimony the Fight BAC campaign, 
which is focusing on educating subgroups most vulnerable to 
food-borne illnesses, pregnant women, children, and the 
elderly. How does this work? How do you tailor these campaigns 
and get the message to reach people?
    Ms. Woteki. I think the Fight BAC campaign did a really 
good job in initially developing a research-based set of 
messages for consumers and then in subsequent years focusing 
those messages on specific groups. The initial year of the 
campaign was a general public education campaign. More recently 
the partnership has developed a kit of educational materials 
for elementary-school-aged children that teachers can use in 
the classroom, or that can be used by Girl or Boy Scout troops 
or other appropriately aged children. The partnership has now 
focused activities on school-aged children.
    In addition, many extension educators across the country 
have been using Fight BAC materials and tailoring them to their 
specific communities' needs. I think by having developed this 
research-based set of messages, focusing on specific population 
groups, we have been able to educate underserved communities in 
food safety as never before.
    Ms. DeLauro. How do they distribute the material to the 
public? Do they contact directly or distribute it to schools?
    Ms. Woteki. All of the above. There is a food safety Web 
site at which these materials can also be obtained. They have 
been made available through the extension service. The FSIS 
office of education has duplicated many of these food safety 
education materials and made them widely available to the 
general public.

                           listeria outbreaks

    Ms. DeLauro. I want to put two questions together that have 
to do with Listeria. There was a January 16 Washington Post 
Magazine article that was critical of USDA for taking too long 
to issue the recall notice to Sara Lee where we saw 100 people 
ill and 21 people died. I highlighted this outbreak in last 
year's subcommittee hearing. I would like to know why the 
decision to close a plant infested with a pathogen as dangerous 
as Listeria is a voluntary one? What factors went into deciding 
that it was not in the best interests of public safety to make 
shutting down such plants mandatory? Does USDA need additional 
authorities to speed recall and increased consumer protection 
from contaminated meat?
    Now, hold that for one second. We also have consumer groups 
who have criticized USDA for failing to require the testing of 
ready-to-eat meat products and plants for Listeria. USDA, as I 
understand it, recommends such testing, but it has not issued 
regulations to mandate testing for all processors. And would 
that mandatory testing provideimproved public health 
protections and level the playing field in the industry?
    Ms. Woteki. Actually let me start with your last question 
first.
    After that particular outbreak FSIS undertook a number of 
steps to address Listeria monocytogenes. That large outbreak 
really had a profound effect not only on the public, but also 
on the Agency. Among the first things that we did was to 
develop both a short-term action plan and a long-term plan. In 
the short term the Agency immediately contacted plants that are 
producing ready-to-eat product and were under HACCP. These 
plants were told to reevaluate their HACCP plans because 
Listeria, in the Agency's view, was likely to occur in ready-
to-eat products. The Agency is now following through by doing 
in-depth reviews on Listeria. The plant where this outbreak 
occurred was the first to undergo that type of in-depth review.
    The Agency also--and I personally--wrote to the major 
medical associations as well as the dietetic association and 
asked them to train and educate their members in food safety so 
that this message is transmitted to vulnerable populations, 
women who are pregnant, elderly, the young children, and those 
who are medically compromised. This education would be part of 
the regular care that they would get and part of the irregular 
visits to physicians.
    We also implemented some longer-term activities to develop 
tests that can be used and be far more accurate, as well as to 
understand the shelf life of ready-to-eat products and how this 
organism can grow under refrigeration conditions. ARS recently 
announced, it is beginning some of these major studies. There 
were a number of very positive steps that we are undertaking 
both long term and short term.
    With respect to and the need for legislation, clearly the 
administration believes that FSIS and the Secretary of 
Agriculture require additional legal and enforcement authority. 
This includes the ability to level civil penalties, 
particularly when there are repeat occurrences or violations; 
mandatory recall authority; and also a requirement contained in 
legislation that the administration proposed, H.R. 983, 
requiring individuals who have knowledge of a food safety 
problem to report that knowledge. We definitely believe that 
the Secretary and this agency do require those additional 
authorities.
    You also asked about FSIS's authority to essentially shut 
down a plant when problems are identified.

                        ENFORCEMENT AUTHORITIES

    Ms. DeLauro. Mandatory shutdown.
    Ms. Woteki. The agency, in fact, does have those 
authorities, and I would like to ask Mrs. Glavin if she could 
review for you the conditions and the situations under which we 
do have those authorities.
    Ms. DeLauro. Could I just get this answered, and then I 
apologize to any colleagues.
    Mr. Skeen. No apologies necessary.
    Mrs. Glavin. We have the authority to withhold the marks of 
inspection whenever an inspector in the plant is not able to 
determine that the product is not adulterated. Our inspector 
has to make a positive finding that the product is not 
adulterated. When he or she is not able to do that, he will not 
allow the mark of inspection to be put on the product. That has 
the result of causing the plant to stop production.
    We can also suspend inspection when there are ongoing 
problems that are not being corrected or there is a pattern of 
problems not being corrected. FSIS can ultimately seek to 
withdraw inspection permanently through an administrative 
hearing.
    There are also situations where if one of our employees is 
threatened or in any way in danger, that we will immediately in 
those situations suspend and seek to withdraw inspection.
    Ms. DeLauro. I don't want to prolong this, but I will 
submit, given what you said about the ability to do what, in 
the case of the Bil-Mar why we don't take the initiative when 
we have such a dangerous set of circumstances; why don't we 
just shut it off? I will put that in writing.
    [The information follows:]

    Under current law, FSIS cannot mandate a product recall; it 
can only request one. The Agency does not ask for a recall 
unless it has reason to believe product is adulterated or 
misbranded and can move to detain product and pursue a seizure 
through the courts. In the absence of a positive sample from an 
intact product, the strength of epidemiological evidence must 
be determined by scientists on a case-by-case basis.
    At the time Sara Lee, the parent company of Bil Mar Foods, 
initiated its December 22, 1998 recall of ready-to-eat 
products, FSIS published a Recall Notification Report (RNR) on 
its website. At this time, however, FSIS had no firm evidence 
of adulterated product attributable to Bil Mar. The company-
issued press release and the RNR were receiving considerable 
attention (news stories ran nationwide on TV and in newspapers) 
and the CDC gave extensive interviews on the illnesses and 
deaths and the symptoms of the illnesses. USDA'S Meat and 
Poultry Hotline, the telephone number for which was included on 
the RNR, received hundreds of calls from consumers and prepared 
a recorded message for people calling after hours. 
Consequently, the public did receive information about the 
recall and the outbreak prior to the January 28, 1999 issuance 
of the agency's recall press release. The CDC also regularly 
issued Morbidity and Mortality Weekly Reports (MMWRs) with 
updated figures and information on illnesses. On January 20, 
1999, Sara Lee published full-page ads in 60 newspapers 
(according to news accounts) reminding consumers not to eat and 
to return any products in question to the point of purchase.
    To improve USDA's ability to respond to food safety 
emergencies as quickly and effectively as possible, the 
Administration believes that FSIS requires additional legal 
authorities. These include the ability to order mandatory 
product recalls; levy civil penalties against repeat violators 
of the meat, poultry, and egg acts; and require individuals 
with knowledge of food safety problems to report that 
knowledge. In this regard, the Administration supports the 
``Safe And Fair Enforcement and Recall (SAFER) for Meat and 
Poultry Act'' introduced as S. 18 in the Senate by Senator Tom 
Harkin and in the House as H. 983 by Congressman John Baldacci.

    Ms. Woteki. We would be happy to answer in writing, but if 
I might just very briefly address that?
    Mr. Skeen. Yes, go ahead.
    Ms. Woteki. In this particular instance the Agency 
collected samples of product from this company and, if my 
memory is correct, tested over 400 samples, all of which came 
up negative for this organism. Without that evidence, the 
Agency really did not have the authority to go ahead and 
request that the plant shut down or require that the plant shut 
down. So the product needs to be adulterated in order to do 
that.
    Ms. DeLauro. Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Bonilla.
    Mr. Bonilla. Thank you, Mr. Chairman.

                    FSIS ANTI-DEFICIENCY VIOLATIONS

    Dr. Woteki, I would like to start with the testimony that 
was given recently by Secretary Glickman and Mr. Dewhurst about 
new administrative procedures that have been put in place to 
prevent a repeat of the cost overruns of fiscal year 1997 and 
1998. Has there been an outside third-party audit of the 
procedures to ensure that they are working, and do you feel 
confident to guarantee that there will not be a repeat of those 
cost overruns?
    Ms. Woteki. The Agency has done two things. One is to 
implement as of October 1 of this fiscal year a new financial 
accounting system. It goes by the initials FFIS, Foundation 
Financial Information System. That system, I think, is going to 
go a great distance towards improving our oversight of the 
expenditure of funds.
    Secondly, and directly answering your question, the Agency 
is entering into a contract with an outside organization to 
review its financial and accounting systems.
    Mr. Bonilla. Is it an audit? You said review, and that is 
different.
    Ms. Woteki. Yes. It is not, to my knowledge, an audit. It 
is a contract with a financial firm that is going to provide 
advice to the Agency on how to better control its funds. Also 
the Agency has been consulting very closely with USDA's chief 
financial officer as it has undertaken both the implementation 
of this new financial management system and this contract. The 
CFO is involved in these discussions and decisions.
    Mr. Bonilla. So are you confident that this problem will be 
eliminated?
    Ms. Woteki. I am confident that we are doing everything 
that we possibly can to ensure that there is not a recurrence.
    Mr. Bonilla. The private sector, and I know that this is 
different, there would probably be a requirement that it be 
eliminated or certain people would be eliminated for not having 
the responsibility of guaranteeing that. So that is why I am 
asking this kind of question. I think the taxpayers, frankly, 
would want that kind of guarantee as well, because this would 
not be tolerated anywhere else except in a government agency to 
be recurring.
    For example, oftentimes in the private sector, audits are 
used to find out exactly where every dollar is, and standards 
and guidelines are used such as those of the American Society 
for Quality. That is just to assure that it is a fair and 
objective outcome. So do you have specific guidelines when you 
conduct this kind of audits? And they are also tied into audits 
of meat and poultry plants specifically? Do you have any 
specific guidelines that you have? Are they definite or finite, 
or are they something that you can just look at? These are 
numbers, so you should be able to look at a bottom line.
    Ms. Woteki. Mr. Bonilla, I agree with you that we need to 
be accountable for our funds. As I indicated, we are doing 
everything possible within the constraints that we have to 
address them. Yes, it is true that being in a Federal agency is 
a somewhat different situation. There are also some 
inflexibilities that we have to deal with that perhaps are not 
encountered in the private sector as well.
    Mr. Bonilla. I understand that, and I tried to distinguish 
that there are mandates and different requirements. I 
understand that.
    And to follow up, what guidelines does FSIS follow to 
conduct audits of meat and poultry plants, for example?
    Mrs. Glavin. We do not do financial audits of meat and 
poultry plants.
    Mr. Bonilla. It seems like, again, getting back to the 
fundamental question of whether there should be an audit, this 
is something that some of us are going to be looking very 
seriously at. We are looking for--these are numbers. These are 
not abstract goals. There should be so much money in certain 
accounts, and that is all can you spend by law. It ought to be 
adhered to.

                              BIOTERRORISM

    Let me ask another question here. The fiscal year 2000 
budget contains a fair amount of funding of several different 
agencies to deal with bioterrorism and the need to be prepared 
to respond to such an event. Beyond funding, this is also going 
to require working closely with law enforcement, such as the 
FBI as well as local and possibly international authorities. 
How are you prepared to do this? Who within your Agency would 
take the lead role in such a situation, and how have you 
addressed any similar incidents in the past?
    Ms. Woteki. We have been actively engaged in the 
Department's efforts in counterterrorism activities. I might 
just briefly indicate to you that my office has been assigned 
the responsibilities for leading the Department's continuity of 
operations planning, and also we are active participants in the 
continuity of government activities.
    With respect to the issues of bioterrorism, at the 
Secretary's request we have established a counterterrorism 
council that the Deputy chairs and for which I am the Vice 
Chair. That council is coordinating the Department's efforts 
across all of the agencies as well as the budget development 
processes in particular with respect to FSIS. The main issue is 
that we need to have a strong inspection work force, and we 
need to have a very strong working relationship with the 
Centers for Disease Control and the Food and Drug 
Administration as part of our day-to-day operations to detect 
outbreaks and to respond to them. With that strong 
infrastructure, we would then be better prepared to respond if 
there is a bioterrorist event.
    On top of that infrastructure, we are working with ARS as 
well as other research agencies in defense and other places to 
develop better detection techniques and to equip our field 
offices with kits that would be used in the event of such 
emergencies.
    Mr. Bonilla. So there is no link yet with Federal law 
enforcement outside of USDA?
    Ms. Woteki. We are linked with the FBI and the other law 
enforcement and defense agencies throughthe National Security 
Council and have been working closely together in one event 
characterized by the FBI as a bioterrorist threat that occurred a 
little bit over a year ago. We have been actively engaged with these 
Agencies as well as our inspector general's office.
    Mr. Bonilla. Thank you very much for your testimony today. 
We appreciate it. Thank you.
    Mr. Skeen. Mr. Farr.

                           single food agency

    Mr. Farr. Thank you, Mr. Chairman.
    Following up with Mr. Bonilla, I knew that APHIS was 
worried about the attack of the killer tomato. I didn't know 
that we were worried about the attack of the killer chicken.
    I would just like to hear your idea of this single food 
agency. When I look at the food and safety inspection, we have 
about 9,000 employees, about $600 million to do meat, poultry, 
and egg products. APHIS, we understand from testimony, has 
about 6,500 employees and $535 million budget to do inspecting 
of fruit and all of the border issues that we hear about. We 
have Food and Drug, which has about $300 million just to do the 
food side, and then the Centers for Disease Control.
    As I sit on this committee, I get more and more confused 
each year about how this whole system is accountable. It seems 
like we built a really awkward administrative health safety 
division.
    Ms. Woteki. Well, like a lot of complicated issues in which 
government has a role, the development and the assignment of 
food safety research, inspection and regulation 
responsibilities has evolved over a long time; about 100 years.
    Mr. Farr. Is there really a concentrated effort to pull 
together?
    Ms. Woteki. There is a concentrated effort within the 
President's Food Safety Council to develop a strategic plan. We 
will be delivering that plan through the Council in July.
    Mr. Farr. Of this year?
    Ms. Woteki. Of this year. The plan is going to address the 
options for reorganization.
    Mr. Farr. I would be very interested. I can tell you just 
sitting on this committee I get confused. I think everybody 
does a good job, but when you are out in the field--tell me, in 
your development of your rules, does EPA get involved like they 
do with APHIS?
    Ms. Woteki. To a lesser extent. EPA and FSIS do have some 
cooperative undertakings. For example the determination of the 
levels of pesticide residues in meat and poultry products is a 
collaborative effort with EPA. FSIS also in its residue testing 
programs, does test products for EPA-established tolerances. 
There is a working relationship with EPA on that side as well.

                     forced molting of laying hens

    Mr. Farr. On that issue I have a lot of SPCA contributors, 
members of my district. One of the questions they were 
interested in and wanted me to ask is the issue on laying hens, 
about Salmonella enteritidis, that they believe there is a 
problem because the birds are so severely stressed that it 
causes this to be passed on to consumers in shell/eggs, and I 
guess the question is forced molting was made illegal in Great 
Britain. Is this something that this country has considered?
    Ms. Woteki. The issue of forced molting has come up 
repeatedly over the last few years, as has the more general 
issue of animals under stress and the association of higher 
pathogen levels and the shedding of pathogens in those animals 
that are under stress. It is certainly an area that we are very 
much concerned about in our farm-to-table food safety approach.

                              antibiotics

    Mr. Farr. Are you also considering the use of antibiotics? 
A lot of us here represent a lot of vegetable areas, and we are 
all moving into organic farming as we move along, and the 
President has just released the rules for comment. In your 
industry, obviously the complaints are that we overmedicate--
medicate is not the word, but we use a lot of antibiotics which 
then get passed on to the consumer. Is there--could you just 
explain quickly what is moving in that arena right now in your 
jurisdiction?
    Ms. Woteki. We have been working closely with the Food and 
Drug Administration, the National Institutes of Health and the 
Centers for Disease Control in developing an action plan to 
combat the development of resistance to antimicrobials. It is 
called the Antimicrobial Action Plan. The Action Plan focuses 
both on the human use of antibiotics, a very important 
contributor to the development of an antibiotic resistance, as 
well as to the subtherapeutic and the therapeutic uses of 
antibiotics in animals. We look at this as being an important 
problem and one in which the Department's research as well as 
the regulatory agencies have a role to play. The Antimicrobial 
Action Plan is going to be made public in the near future. I 
can't remember exactly what the date is going to be.
    Mr. Farr. This year also?
    Ms. Woteki. Yes, this year.
    Mr. Farr. So both of these plans will be available to this 
committee in the next couple of months?
    Ms. Woteki. Between now and July, yes.
    Mr. Farr. Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Latham.

                         egg safety action plan

    Mr. Latham. Thank you, Mr. Chairman, and welcome everyone.
    The administration unveiled its new Egg Safety Action Plan 
last year. There is concern in Iowa that the approach seems to 
heavily emphasize testing without providing any specifics of 
procedures or requirements or cost. And my question would be 
what can the farmers in my district expect to see from your 
Agency that will allow them to adequately prepare for a coming 
regulation?
    Ms. Woteki. FSIS is holding public meetings to get input 
from the general public on some of these issues. One of them is 
being held later this month in Columbus, Ohio, and the second 
is at the beginning of April in Sacramento.
    The Egg Safety Action Plan has two different Salmonella 
enteritidis reduction strategies upon which it is premised. One 
encompasses environmental testing and the diversion of eggs on 
the farm, while the second strategy includes a kill step, a 
lethal treatment at the packer/processor level. Each of these 
strategies is based on the farm-to-table approach upon which 
all of our pathogen reduction activities are premised.
    As I had indicated, there are public meetings being planned 
at which the details of these two strategies will be discussed. 
Also I might indicate that before that plan goes into place, 
there is rule-making that is required, and that during rule-
making cost estimates will be developed. There will also be 
ample opportunity for public comment during the rule making 
stage on the content of the rules.
    Mr. Latham. I am aware that there is a proposed warning 
label for egg cartons. Could you tell us what role the Food 
Safety Inspection Services will have in deciding what the label 
will say, and will it be educational or border on being 
alarming or scary to the consumers? What do you see?
    Ms. Woteki. That is an FDA requirement.
    Mr. Latham. You are going to have a role in it, apparently?
    Ms. Woteki. We have coordinated with FDA, yes, on the 
development of that. I haven't actually personally seen that 
label, but we could certainly provide copies of it to you.
    Mr. Latham. Would you know what is going to----
    Mrs. Glavin. I believe it talks about how to handle the 
product, how to cook it, how to refrigerate it. I think there 
are three or four pieces of information on there having to do 
with those kinds of handling issues.
    Mr. Latham. I am just concerned that it was going to be 
scary to the consumer and not really beneficial.
    Ms. Woteki. That has not been the case with the meat and 
poultry safety labeling. In fact, consumers find it beneficial. 
So I am assuming that the response will be similar.
    Mr. Latham. As far as handling, fine, but if it is a big 
warning sign that your eggs are----
    Ms. Woteki. No, it is in the nature of safe handling 
instructions.

                              irradiation

    Mr. Latham. As you are aware there is an electronic 
pasteurization facility located in Sioux City. There has been 
some debate on what packaging will be allowed to run through 
the machine. Will we continue to see the rise in the use of 
noncobalt irradiation or electronic beam irradiation in the 
coming years, and will you be keeping track of these 
facilities, and do you feel they positively contribute to our 
food safety efforts and our regulatory issues, such as those 
with packaging, slowing down the use of the technology? A lot 
of questions.
    Mrs. Glavin. We are delighted to have another tool in the 
food safety arsenal, and irradiation is certainly that, another 
tool.
    With respect to the packaging, we requested of FDA and 
received from them recently a letter permitting the use of 
additional packaging while they continue their review of 
irradiation technology. We have made that known to industry so 
that the packaging won't be an impediment to the use of 
irradiation of meat and poultry products.
    Mr. Latham. Do you have any information or have you done 
any surveys as to public acceptance, whether you say 
``irradiated'' or, say, ``electronically pasteurized''? Do you 
have any information on that?
    Mrs. Glavin. We have done no studies in that area, no, sir.
    Ms. Woteki. There were articles printed just within the 
last year in a professional journal called ``Food Technology'' 
reviewing consumer studies indicating that when an educational 
program about the benefits of irradiation is provided along 
with the product available for sale, that consumer acceptance 
is quite high.
    Mr. Latham. Okay. Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Boyd.
    Mr. Boyd. Thank you, Mr. Chairman.

                         regulatory delayering

    Dr. Woteki and others, welcome. I wanted to tell you that I 
have had the chance in the last several months to tour and 
visit with a couple of processing plants in north Florida and 
found that enlightening and very informative. The latest visit 
was in the last several weeks in which I visited a poultry 
plant, had an opportunity to get a detailed briefing on the 
HACCP regulations, and then went out to the line and talked to 
your inspectors, saw your inspectors that were trying to 
implement your HACCP scheme, and I also saw in-line 
inspectors--I guess that goes back to the layering problem 
which we have talked about. My question is built around that.
    First of all, I know that you have a timetable for 
delayering, and I assume that you will be getting us your 
request to complete that regulatory review so that we can get 
that delayering done as quickly as possible. It appears to me, 
and your testimony backs up the fact, that the HACCP system is 
working very well. Would you speak to, first of all, that 
timetable and also your request to this committee--I think that 
you would find some support on this committee--for having the 
additional resources to complete this review. Let's get the 
HACCP scheme in place and delayer.
    Ms. Woteki. You are absolutely correct that this has been a 
major initiative for FSIS, actually over the last 5 years. The 
Agency began in 1995 a comprehensive review of its regulations, 
policy notices, and policy memoranda. In that same year FSIS 
published an agenda for change identifying what regulations 
needed to be revised, particularly looking forward to full 
HACCP implementation.
    Many of the Agency's regulations were what people have 
characterized as being command and control regulations. They 
were very, very specific. Because of the initiatives that have 
been under way for the last several years, the Agency expects 
this year, fiscal year 2000, to eliminate more than 600,000 
paperwork burden hours. It is a very substantial achievement. 
They have revised or eliminated 40 directives in order to 
provide more consistency under the HACCP program.
    In addition to undertaking that review, the Agency also 
went to the industry and asked what its priorities were for 
regulations that need to be revised as part of HACCP 
implemention. The industry provided a list. The top five 
priorities on that list have all been addressed. In fact, the 
Agency has concluded seven major regulatory reviews; seven 
major regulations have been completed and finalized. There are 
four more that are currently in process, and my expectation is 
that each of these four regulations will be in departmental 
review this year; in the next couple of months, actually. Based 
on public comment, we hope to move forward and get those 
finalized.
    Some of these, though, are fairly substantial rules. They 
required an enormous amount of technical expertise and 
development, and they are going to need careful review and 
thought.
    Mr. Boyd. So the second part of the question was; would 
there be additional resources needed to keep this regulatory 
view? It is my understanding that we don't have that request. 
Can you get it to us within some reasonable, quick time-frame?
    Ms. Woteki. Built into our 2001 budget request are some 
resource requirements and an additional FTE to complete this 
process.
    Mr. Boyd. Thank you, very much.
    Mr. Chairman, I have 13 seconds left and I yield that back 
and will ask my other question on the next turn.
    Mr. Skeen. Well, it will draw interest.
    Mr. Boyd. Please do. I like your way of thinking.
    Mr. Skeen. Mr. Nethercutt.
    Mr. Nethercutt. Mr. Chairman, I yield to Mr. Dickey. I 
think that he has time constraints.
    Mr. Skeen. He has a hot rocket in his pocket.
    Mr. Dickey. He is just recognizing that I ask better 
questions than he does.
    Mr. Nethercutt. Taking back my time then--
    Mr. Skeen. Mr. Dickey.

                          Inspector shortages

    Mr. Dickey. Good morning, you all. Last year I was in touch 
with you all quite regularly because of the shortage of 
available inspectors. You were here then. While I am supportive 
of scientific-based inspection and other initiatives to improve 
efficiency and control costs, I fear that FSIS may have made 
cuts in the wrong areas. Do you believe that your proposed 
increase in inspectors will solve this problem?
    Ms. Woteki. Yes, sir, we do. As we reported to this 
subcommittee earlier this year, we are making verysubstantial 
progress in hiring in-plant inspectors. Before you had come in, I had 
made reference to this chart on a couple of occasions. The 
appropriation for this year provides funds to increase the numbers of 
in-plant permanent full-time inspectors from 7,440 to 7,610, which is 
that solid line. And then the dotted line is an indication of where we 
currently stand with respect to hiring. We are now at 7,467, which puts 
us in the first quarter ahead of where we had projected to be.
    Mr. Dickey. Was this just a problem of money?
    Ms. Woteki. It was a problem of a tight marketplace right 
now. Not only is FSIS experiencing problems in keeping good 
employees and attracting new employees, other government 
agencies as well as the private sector are having a difficult 
time.
    Mr. Dickey. We just had heard all sorts of rumors, and we 
couldn't--it was so persistent that we couldn't understand what 
it was. We have got the problem behind us, do you think?
    Ms. Woteki. I believe we are well on the way to getting it 
behind us. What we need to do is to continue this hiring that 
will bring us up to the 7,610.
    Mr. Dickey. My staff has been given a budget that includes 
a $4 million cut for inspections, and yet you are trying to 
increase the staffing from 7,440 to 7,610. What is the deal?
    Ms. Woteki. Well, sometimes our budget submissions are 
difficult to understand because the numbers as they are laid 
out don't provide you with all of the details. In this case if 
you look at the budget tables, the decrease of 150 is largely 
from overtime that is paid to processing inspectors. Earlier I 
had made a clarification in my oral testimony that indicated 
that the Agency will not move forward in implementing that 
change without first developing criteria as well as a risk-
based approach towards conducting those processing plant 
inspections. So the 150 is, as I said, largely overtime, not 
actual individuals, but overtime that is paid to them that is 
represented by FTEs in the budget.
    Mr. Dickey. But you will have more inspectors?
    Ms. Woteki. We will have more in-plant full-time inspectors 
under this hiring in fiscal year 2000.
    Mr. Dickey. But the $4 million that you have as a cut for 
the inspections is explained in what your testimony just was?
    Ms. Woteki. Correct.
    Mr. Dickey. I will have to figure it out later.
    Ms. Woteki. I will be happy to work with you as well. It 
has taken me a while to get my mind around it.
    Mr. Dickey. If FSIS is able to obtain its requested 
increase in inspectors, how long will it be before we will see 
those inspectors are trained and in the plants?
    Mrs. Glavin. Well, again, we expect to be up to the 7,610 
by the end of this June, and as we bring those people on board, 
we do get them trained. We have this year, since the beginning 
of the fiscal year, brought on board 226 new in-plant 
employees, and we are continuing to actively recruit. They come 
on every week. Every few weeks we are bringing more people on 
board, getting them trained and into the plants so they can hit 
the ground running pretty quickly.
    Mr. Dickey. You understand that as far as I am concerned--
and I am the most important member of this subcommittee--that I 
would like for you to make sure that Arkansas is taken care of 
first. Is that a deal?
    Thank you, Mr. Nethercutt.
    Mr. Skeen. Mr. Hinchey.

                            listeria testing

    Mr. Hinchey. Thank you, Mr. Chairman.
    As one of the least important members of the committee, I 
am happy to have the opportunity given by my Chairman to ask a 
few questions on what is obviously a very important subject. I 
know that you noted in your testimony, and I think accurately 
so, that the U.S. food supply is the safest in the world. 
Nevertheless, in spite of that, we still have 76 million people 
who get sick and 325,000 who are hospitalized and 5,000 people 
who die every year as a result of food-borne illnesses. So in 
spite of our best efforts and the fact that you do a very good 
job, we still have not reached perfection by any means.
    You are finishing the process of implementing a new 
program, a new approach to inspections in slaughterhouses and 
places of that nature. As I understand it, instead of having 
inspectors there looking at every individual product that comes 
along an assembly line or goes through a process, you are 
requiring each facility to develop a plan. You then look at 
that plan and see if it meets certain minimum standards. If it 
does meet standards, you feel comfortable with it and feel that 
it is meeting the safety requirements, and then you inspect to 
see if the plan is being implemented. Do I have that roughly 
correct?
    Ms. Woteki. Roughly correct. On top of that we also do 
performance testing for Salmonella as an indicator of the 
plant's ability to produce safe product.
    Mr. Hinchey. So you do those periodic tests?
    Ms. Woteki. Correct.
    Mr. Hinchey. There was this question of Listeria. Are there 
tests for that as well?
    Ms. Woteki. There are tests for Listeria. There is 
currently no requirement for Listeria testing.
    Mr. Hinchey. Where would that requirement come from? Would 
it come from the Congress, or is that something that you have 
the authority to do now?
    Ms. Woteki. This is something that the Agency has authority 
to do and is actually undertaking quite a bit of work in this 
area. Among the things that the Agency has done is to ask the 
Agricultural Research Service, which does the research that 
supports the Agency's programs, to undertake a study that goes 
by the short name of a shelf life study to determine the levels 
of Listeria monocytogenes in ready-to-eat products and how that 
organism grows out over time on product kept at different 
temperatures. It is a very important piece of work. This is 
also an organism for which some additional new tests are being 
developed. There is also refinements that need to be made. So 
that type of work is under way as well.
    Mr. Hinchey. Dr. Woteki, you have the authority to do that 
work now, to require testing for Listeria. If you discern that 
it is necessary, would you order those tests to take place?
    Ms. Woteki. Yes. And we have the work under way that would 
lead us to information that will allow us to decide whether to 
establish a performance standard for Listeria or other 
requirements for Listeria testing.
    Mr. Hinchey. Those recommendations will come to you at some 
point in the near future, I assume?
    Ms. Woteki. As the work is done.
    Mr. Hinchey. And then make a judgment on that. When do you 
think that would happen?
    Ms. Woteki. The shelf life study that I referred to is just 
getting under way, so that will certainly continue through this 
year.

                       mandatory recall authority

    Mr. Hinchey. Okay. I am interested in it from the same 
perspective as Mr. Dickey, but also from the fact that most of 
the people from my district are consumers rather than the 
processors. We are, I guess, on the other end of the line of 
the end product. That is the concern that I have, and I know 
that is the concern that we all should have.
    There is, however, a lack of regulatory power. We know, for 
example, the government can order a recall if certain products 
are found unsafe. If a toy is unsafe or an automobile is unsafe 
or some kind of a chemical product is unsafe, appropriate 
government agencies have the right to go in and recall that 
product and get it off the market. But with regard to food, 
health officials do not have that authority. This strikes me as 
very ironic. In this particular situation our health officials 
must persuade the company that is producing this unhealthy 
product to recall it. You can't demand that they do so. Is that 
appropriate, or are we missing something here?
    Ms. Woteki. Well, we believe that there is the need for 
additional authorities in this area, and we have worked to 
develop a bill that has been introduced as H.R. 983 that will 
provide authorities to the Secretary of Agriculture to do 
mandatory recalls, to assess civil penalties, as well as would 
require individuals when they were in knowledge or had 
knowledge that there was unsafe food, to make that information 
available to the Secretary. So we would very much like to see 
those additional authorities become law.
    Mr. Hinchey. Thank you very much.
    Thank you, Mr. Chairman.
    Mr. Skeen. Mr. Nethercutt.
    Mr. Nethercutt. Thank you, Mr. Chairman.
    Glad you are all here, and thank you for your testimony. 
Just by way of procedure, it is brought to my attention that 
our office didn't receive the final written statement for your 
testimony today until about 9:00 o'clock last night on e-mail. 
I wondered--if I missed it earlier in the testimony, I am 
sorry, but could you enlighten us as to why that happened and 
what the reason for that is?
    Ms. Woteki. Certainly, I would be happy to, Mr. Nethercutt. 
There were actually two things that happened. One was in the 
courtesy visits that we paid to members of this subcommittee, a 
number of you raised questions about two of the initiatives 
within the budget. In addition, some of the consumer advocacy 
organizations also met with us late last week to also raise 
concerns about these.
    What we decided to do was to take the opportunity to 
clarify the position towards these two initiatives. 
Essentially, very briefly, those two clarifications are that 
FSIS will not proceed in implementing the HACCP-based 
Inspection Models Project until the proper evaluations of that 
project are concluded, and FSIS will not implement random 
inspection of processing plants until proper evaluations are 
conducted. It is essentially in the nature of clarification to 
the testimony.

                       non-tariff trade barriers

    Mr. Nethercutt. It might help us just for future reference 
to give notice that it is going to be late and that there is 
no--there is a good reason, and that might help us in planning.
    I happen to be supportive of the food safety and inspection 
services that our government provides. I think we have the 
safest food supply in the world. We have the best system. It is 
getting better, I believe. And we find ourselves, I think, in a 
position of comparison with other countries. For example, I 
think it is fair to say that the European friends and 
competitors, frankly, look at the process and make judgments 
about safety. We look at products and make judgments about 
safety. I think our model is the better one as we look at what 
is safe on the market as opposed to what process got it to be 
safe, or even in questions that may be uncertain about that 
safety.
    How do you all look at this challenge? We have to make sure 
that--other countries of the world who focus on process, 
biotechnology in particular, miss the point, it seems to me, 
about the need to have safe food on the market, safer human 
consumption, which ought to be our highest authority, rather 
than challenge the process by which that food is grown or 
manufactured. We have had biotechnology in this country forever 
and forever, it seems like, as we have looked on the ground at 
agriculture improvements and other mechanics of growing crops 
that involve gene splicing and so forth. So biotechnology is 
not new.
    I happen to think it is a nontariff trade barrier that 
these countries are engaging in to keep our products out of 
their countries. How do you see it? Do you agree that the 
inspection of the product is more important than any inspection 
and analysis of the process?
    Ms. Woteki. Well, we are actually engaged on two different 
levels in addressing the issues that you have raised. The first 
level is through international organizations in which the U.S. 
Government participates. Probably the one that is most relevant 
is what is called the Codex Alimentarius. That is an 
organization that reports to the Food and Agriculture 
Organization and the World Health Organization of the U.N. It 
does standards-setting for food products on safety and to a 
certain extent quality grounds as well. The manager for the 
Office of U.S. Codex is located within FSIS and also reports to 
my office. So in international negotiations we work with other 
U.S. Government agencies, the industry, the biomedical 
community, the academic community in developing the positions 
that the United States is taking into these international 
organizations.
    And with respect to the safety criteria that are developed, 
Codex is currently considering biotechnology as one case in 
point since you mentioned that. And just this month there has 
been a meeting in Japan that is a task force of the Codex to 
address the safety as well as the criteria of biotechnology 
products.
    FSIS is also engaged in evaluating the programs of 
countries that want to export meat to the United States, as 
well as engaging the countries that we want to export to. The 
direction that we are taking under those types of negotiations 
now is a determination of equivalency of programs. FSIS has 
recently completed equivalency determinations of countries 
wishing to export product to the United States under the HACCP 
rules. So we are essentially focusing on the end product as 
opposed to the process.
    Mr. Nethercutt. I am glad to hear you say that. I think 
that is the critical determination that has to be made; is it 
safe for human consumption as opposed to how do we get through 
the process of dealing with a particular food. So I thank you 
for your testimony.
    Thank you, Mr. Chairman.
    Mr. Skeen. Miss Kaptur.

                         shell egg surveillance

    Ms. Kaptur. Thank you, Mr. Chairman.
    Dr. Woteki, this year your budget request includes the 
elimination of language that has been long-standing in 
appropriation bills. I will quote, and it is relative to the 
Egg Product Inspection Act. It says, ``For shell egg 
surveillance under section 5(d) of the Egg Products Inspection 
Act.''
    I am curious why you would be proposing deletion of this 
language, and what did the current language prohibit you from 
doing that you would like to do?
    Ms. Woteki. I believe that that is the transfer of 
authority from AMS to FSIS in order to engage in shell egg 
inspection activities that the Agency would be undertaking.
    Ms. Kaptur. It is eliminating it from the AMS portion of 
USDA and transferring it to FSIS?
    Mrs. Glavin. Mr. Dewhurst has reminded me that the language 
that you are referring to prohibited us from using our funds 
for shell egg surveillance. Under the Egg Safety Action Plan it 
is our intention to, in fact, engage in shell egg surveillance.
    Ms. Woteki. This would facilitate.

                    salmonella performance standards

    Ms. Kaptur. This would facilitate. All right. Very good.
    I understand there is a court case pending in the State of 
Texas in which a beef processor is challenging the Department's 
regulations limiting the level of Salmonella contamination that 
can be present in meat. I have information that tells me that 
plant has been in violation of Salmonella limits before. Could 
you tell me the current status of that court case, and does it 
limit the ability of FSIS to enforce Salmonella regulations?
    Ms. Woteki. Currently it is not having any effect on the 
Agency's ability to enforce. There is a trial set for May, I 
believe. We believe that HACCP coupled with performance 
standards such as the Salmonella performance standard is 
proving to produce a much safer product, and we are confident 
that HACCP combined with performance standards will remain a 
very important part of our approach towards food safety.

                           import inspection

    Ms. Kaptur. Thank you.
    In the area of imported meat and poultry, your budget for 
import-export inspection is about $11.5 million, less than 2 
percent of the total appropriation that you are requesting. It 
is my sense that the amount of food being imported into this 
country in meat is increasing at record proportions. Could you 
tell us roughly how much FSIS is spending on import safety in 
this fiscal year and how much is proposed for 2001, please?
    Mrs. Glavin. I can certainly get you the exact figures, but 
we have something in excess of 60 inspectors who inspect 
product at our import stations.
    Ms. Kaptur. What percentage of foreign plants do you 
actually cover in a year?
    Mrs. Glavin. First of all, we make a determination that a 
foreign country has a system which is equivalent to our system, 
which produces food safety results equivalent to our system. 
That is the first level of oversight that we have.
    The second level of oversight is we do on-site audits of 
foreign inspection systems approximately every 12 to 15 to 18 
months. We try to get there every year, but sometimes it slips 
a little bit longer than that.
    Ms. Kaptur. One hundred percent of them?
    Ms. Woteki. Of the countries, yes, ma'am.
    Ms. Kaptur. Of the countries, but of the companies?
    Mrs. Glavin. The number of plants we visit in the country 
varies. If there are a very small number of plants, we will go 
to 100 percent of them. If they have a large number of plants, 
we might do a percentage of them. That depends on what kinds of 
things are going on with respect to that country and how 
confident we are when we start our review in that country's 
ability to perform as they have told us they are performing.
    And then the third level of oversight is with our 
inspection of product when it comes into this country. All 
product coming into this country is subject to inspection. The 
product is subject to different kinds of inspection. We might 
do a package inspection or a labeling----
    Ms. Kaptur. What percentage of imported shipments are 
actually inspected?
    Mrs. Glavin. All product coming in is subject to 
inspection. The intensity of the inspection varies according to 
our computer program, which looks at past history from both 
that country and that particular plant in that country.
    Ms. Kaptur. Is your rejection rate increasing or 
decreasing?
    Mrs. Glavin. I don't know the answer to that. I would 
assume that it remains relatively steady over time, over, say, 
a year's period. I can certainly pick particular periods of 
time when we have blips up and down, but over the year I 
believe--we can confirm this for the record--that it is 
relatively steady.
    [The information follows:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    Mrs. Glavin. Then, as I said, we look at the product coming 
in. One of the things we are engaged in this year is a major 
review of how we do import inspection as product comes in and 
how we can improve that system to ensure that we, in fact, are 
taking an appropriate look at product as it comes into the 
country.
    Ms. Kaptur. The $11.5 million in your budget here, is that 
the total amount for import-export inspection, or are there 
other funds in other parts buried in line items to the budget 
relative to imports?
    Mrs. Glavin. That should include the total amount including 
the share of lab resources, et cetera, that go to these 
programs.
    Ms. Kaptur. Have you increased your inspectors over the 
years because of the increasing volume of imports?
    Mrs. Glavin. We have not had an increase recently in the 
number of import inspectors.
    Ms. Kaptur. How could that be possible?
    Mrs. Glavin. Again, because of the threefold look we take 
at these countries. First of all, approving them for ability to 
import into this country and, second of all, the ongoing 
reviews we do of those countries' programs. What the actual 
import inspection does is a final check that all of our 
information--that we have made the right decisions based on all 
of the extensive information that we have about those 
countries' programs and how they are operating.
    Ms. Kaptur. Thank you, Mr. Chairman.
    Ms. Woteki. If I might just footnote, this system that Mrs. 
Glavin has described for meat and poultry products provides a 
high level of assurance to U.S. Consumers that meat and poultry 
products being imported are safe. The Food and Drug 
Administration, which has authorities over other food products 
that are imported, does not have the authority to do this type 
of equivalency determination for countries that are exporting 
other food products to the United States. This is a substantial 
level of safety for U.S. consumers.
    Mr. Skeen. Mr. Boyd.

                       inspector staffing levels

    Mr. Boyd. Thank you, Mr. Chairman.
    Dr. Woteki, I found the question by Mr. Dickey somewhat 
ironic when I thought about the whole issue of the lawsuit that 
you just completed, HACCP, which should reduce the requirement 
for numbers of inspector bodies. I don't know how you exactly 
reconcile all of that, but I did find it somewhat ironic. I 
guess it is a matter of having the right people in the right 
place rather than the total numbers.
    Ms. Woteki. It is a combination of that and growth 
occurring in the industry.
    Mr. Boyd. So the whole issue about inspectors losing their 
jobs, is it just a matter of training to do additional jobs, to 
implement HACCP, for instance?
    Ms. Woteki. We have committed to stabilizing the size of 
the meat and poultry inspection work force as we have moved 
through the implementation of HACCP. Now are beginning the 
experiments that I talked about in my testimony, the HACCP 
Inspection Models Project, in which there will be a redefining 
of roles and responsibilities and a reallocation of inspectors 
to other types of food safety-related activities. Our budget 
request for 2001 is very much a transition budget that has 
indications in it of the future direction of the inspection 
work force.
    Mr. Boyd. Dr. Woteki, as I mentioned earlier, I have toured 
a couple of plants in the last several months. It got me 
thinking. I learned so much, and maybe I was starting from 
ground zero, but it got me to thinking about how beneficial 
that is. Is there a policy in your office that your senior 
managers of both policy and operation managers have to go and 
inspect a plant and see actually what is taking place----
    Ms. Woteki. Well----
    Mr. Boyd [continuing]. And if not, would you consider it?
    Ms. Woteki. We don't have a written policy to that effect, 
but in essence that is what we do. I have found, as you have 
indicated you found, how incredibly instructive it is to visit 
plants, spend some time, see how the work is done both by the 
plant employees and by our inspectors. Each plant is so 
different in the type of processing that is done or the 
equipment that they have there. It is really valuable to see 
with your own eyes and experience the work conditions.
    Everybody in my office, immediate office, has visited 
plants. We continue to visit plants. The senior management 
within FSIS also routinely does visit, and we all find it very 
instructive.

                   president's food safety initiative

    Mr. Boyd. Thank you.
    In follow-up to Congressman Hinchey's question, I find that 
really whether you are on the consumer side or the production 
side, everybody has the same goal. It just does not pay for a 
processor to get any bad press about food safety. And so I find 
that the folks who run these plants obviously want the absolute 
safest product they can coming out.
    I have one other question and it refers to page 7 of your 
testimony. You talked about the budget including funding to, 
number 4, ``expand the use of HACCP principles and other 
proactive preventive programs, including increasing the number 
of inspections to FDA-related products.''
    What does that last part of that sentence mean, 
``increasing the number of inspections of FDA-related 
products''?
    Ms. Woteki. That is in the section of the testimony where 
we talk about the President's Food Safety Initiative. This has 
been a joint undertaking of HHS and USDA. There are multiple 
agencies in both departments that are participants. One of the 
issues that FDA has faced has been that they do not have 
anywhere near the number of inspectors that FSIS does, yet they 
have the responsibilities for safety of all other food products 
other than meat, poultry and egg products. The President's Food 
Safety Initiative budget request for FDA in each of the 4 years 
of the initiative have highlighted funding requests for FDA to 
support inspections, and I believe that Jim Hughes's testimony, 
the FDA Commissioner this year, highlighted the fact that they 
have made some increases in inspections because of funds that 
have come through the initiative to them.
    Mr. Boyd. Thank you.
    Mr. Chairman, I, too, want to piggyback on Mr. Farr's 
question about the number of agencies that have inspection 
service regulatory requirements. It is just an example of how 
sometimes we contradict each other. For instance, the FDA is 
cutting back on its request for educational funding, public 
education, and we have a severe problem, for instance, on the 
education side of the shellfish area. In your budget you have 
requested increased your funding for education, so I commend 
you for that.
    Also, Dr. Woteki, I commend you for the courtesy office 
visits. I know you tried to set one up with me, and it was our 
fault that we had scheduling problems, not yours, and I wanted 
to commend you for that. Thank you for your testimony.
    Mr. Skeen. Mr. Hinchey.
    Mr. Hinchey. Thank you, Mr. Chairman.
    The earlier discussion about eggshell surveillance reminds 
me of a candling process I used to do when I was a kid on my 
grandfather's farm in the summer. It was a rather 
unsophisticated process, but----
    Ms. Woteki. Something similar is still being used.

                       inspector staffing levels

    Mr. Hinchey. Is that right? I guess some things don't 
change or change all that much.
    There are two aspects of your work that have an interesting 
sort of juxtaposition, and I am trying to rationalize them in 
my own mind. One is that you point out the fact that you are 
having difficulty recruiting people for in-plant inspection 
work because of tightness in the labor market. I assume the 
salaries that you are authorized to pay for these particular 
positions also cause some difficulty in finding people to do 
that work. At the same time we have this plan going into effect 
which cuts back on the number of inspectors in plants, and that 
those inspectors, as I understand it, will come by every 24 
hours or make a periodic inspection. Is one driving the other, 
or are they separate and independent?
    Ms. Woteki. They are quite separate issues. The randomized 
inspection is to occur in processing plants as distinct from 
slaughter plants. The hazard inspection models project which we 
have also referred to involves slaughter as well as processing 
plants. So there really are two very different situations.
    I might also indicate that this budget, as I said on a 
couple of occasions already this morning, does mark a 
transition. Among the things that is included in the budget are 
funds that would help to upgrade the level and skills of our 
employees as well as to provide for a job series, for which we 
have submitted a report to the Congress, that would require a 
higher level of training and be a higher-graded position.
    The transition that the Agency is going through, that this 
whole inspection system is going through, means that future 
inspectors are going to have more science background, a better 
understanding of statistics, and will also be higher-graded. 
They are going to have to go into these plants that have 
different processes and plans and be able to evaluate those 
plans as well as the data that are presented from the plant.
    This budget is very much a transition that will provide 
training funds for our current employees. There are upgrades 
with implementation of the models project as well as, looking 
towards the future, approval from Congress to move forward in 
establishing a new series called the Consumer Safety Officer 
Series, which we believe is going to be extremely important to 
future food safety activities in this Agency.
    Mr. Hinchey. Well, thank you very much for that.
    I know that our food distribution system is always 
changing. Food is a lot more processed now that it used to be a 
decade or two ago. There are some good aspects for that, 
obviously. It makes more food available to more people under 
generally safer conditions, but I am sure that it requires you 
to be very flexible and always prepared to change your 
processes as well.
    I think that it is quite clear that with the resources that 
have been provided by this committee and the conscientious work 
that you are doing, that the food supply is safer than it ever 
has been. So I thank you very much.

                          des chemical residue

    Mr. Skeen. Ms. Kaptur, would you like to wind this up?
    Ms. Kaptur. I would, Mr. Chairman. I just have a couple of 
questions remaining.
    Dr. Woteki, last July the Swiss Government notified the 
USDA that it had found indications of the presence of the 
hormone DES in samples of beef that had come from the United 
States. We know that that substance has been banned here for 
two decades. Last month the Department announced that it would 
soon resume testing in our country for DES. Do you have any 
concerns about the way this episode actually developed and was 
handled by FSIS in particular, and also why did it take so long 
for the Department to respond on the DES issue?
    Ms. Woteki. From the beginning when the Swiss Government 
notified FSIS about their finding, the Agency took it really 
seriously and acted very quickly to request further information 
from the Swiss Government. The Swiss Government decided that 
they needed to have a confirmation of their finding--it was a 
positive finding in two samples--and they referred it to 
another European laboratory, which was unable to confirm the 
results. Despite that, FSIS, working with FDA, (which has the 
authority to trace back to the farm to determine if there was 
illegal use of DES) to do a thorough study to determine if 
there had been any illegal use of DES. FDA did not find any 
evidence in its investigation of illegal use of DES.
    I draw a few conclusions from this. One is an inference 
that since the Swiss were unable to get confirmation of their 
original finding, that that original finding may indeed have 
been erroneous. Putting that aside, FSIS and FDA took the 
initial referral from the Swiss Government very seriously and 
did a thorough investigation.
    On the issue of testing, on the reinitiation of testing 
under the residue program that FSIS runs, when DES was declared 
illegal in the United States FSIS continued to test for DES 
for--in meat products for about 10 years. Consistently we found 
no results, negative results. The Agency made the 
determination--this is again about 10 years ago--it would 
rotate DES off of the usual list of residues, and that it would 
revisit it at some point in the future. This is done for a lot 
of different residues for which there is a long period of time 
with no detection in samples.
    Last year the regular review that the Agency does along 
with FDA and EPA made the determination that it would be a good 
idea to begin testing for DES just to make sure that the 
situation had not changed. So that decision was made. All of 
the steps that need to be put into place to reimplement the 
testing in the laboratory were put under way. In about a 
month's period of time, that testing will begin again.
    I have been satisfied that we took this situation very 
seriously, reacted appropriately, and, as I indicated to you, 
the inference is that there may not have been DES in the 
original detection.

    [Clerk's note.--The following information was provided 
after the hearing.]

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                           codex alimentarius

    Ms. Kaptur. Thank you for that very detailed reply.
    My final question relates to the Codex Alimentarius. You 
have included a request for funding in your budget for the 
first time, and there have been some concerns raised that that 
particular code has been adopting standards that are less 
restrictive than we have here in our country. I am going to ask 
you to comment for the record on that, but would you generally 
like to express some concerns regarding that here this morning?
    Ms. Woteki. I think very highly of the work of Codex 
Alimentarius. I think it is extremely important that the United 
States continue its active participation in Codex.
    You are correct, there are a few standards, three or four, 
that are not currently up to our own level of protection. This 
does not present a problem because we have the scientific data 
to justify having a higher level of protection in those areas 
here in the U.S. An example is lead in bottled water. We feel, 
as you know, very strongly that we need to minimize lead 
exposure from all food sources, and working with FDA there has 
been a decreasing lead level in foods over the past 20 years. 
In this case we do feel that we have data that justifies our 
higher level of protection, so that Codex standard does not 
present a problem to us.
    Ms. Kaptur. Thank you.
    I want to thank you and Ms. Wilcox and Mrs. Glavin for your 
participation this morning and for your responsiveness to our 
witnesses on both sides of the aisle. Thank you very much.
    Mr. Skeen. Very good. We want to thank the panel for this 
beautiful morning.
    Ms. Woteki. Remember last year it snowed?
    Mr. Skeen. Could I ask you to have the meeting in New 
Mexico? We will have chili and all of the rest, but we need the 
rain badly.
    Ms. Woteki. I could bring it with me.
    Mr. Skeen. We have a saying that the Indian tribes use in 
New Mexico, and that is if you want a job done well and right, 
get a woman to do it. But remember this, men get the last word, 
and that is, ``Yes, ma'am.''
    We thank you all very much for what you do and how well you 
do it. The presentation this morning was excellent.
    Ms. Woteki. Thank you.
    Mr. Skeen. And, of course, the wind-up was excellent, too. 
I have great associates. We have done it, and I think done it 
right. Thank you.
    We have Mr. Dewhurst over there as a balance wheel. We 
can't have all of these meetings without you.
    Thank you all very much.
    Ms. Woteki. Thank you.
    [Questions submitted for the record follow:]

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                           W I T N E S S E S

                              ----------                              
                                                                   Page
Ackerman, K.D....................................................     1
Dewhurst, S.B....................................................1, 857
Fritz, Richard...................................................     1
Galvin, Timothy..................................................     1
Glavin, M. O'K...................................................   857
Kelly, Keith.....................................................     1
Parmer, Hugh.....................................................     1
Schumacher, August, Jr...........................................     1
Shackelford, Parks...............................................     1
Wilcox, C.A......................................................   857
Woteki, C.E......................................................   857


                               I N D E X

                              ----------                              

                          Farm Service Agency

                                                                   Page
Acquired Property:
    Credit Sales.................................................   262
    Inventory..................................................250, 262
ADP:
    Common Computing Environment.................................   301
    Purchases....................................................   166
    Spending.....................................................   163
Administrative Support...........................................   159
    CRP Signups..................................................   190
    Emergency Programs...........................................   280
    Tobacco Program..............................................   231
Biography:
    Administrator, FSA...........................................    55
    Associate Administrator, FS..................................    56
    Under Secretary, FFAS........................................    26
Boll Weevil Eradication Loans....................................   168
Citrus Canker Eradication........................................   132
Commodity Credit Corporation:
    Borrowing Authority..........................................   224
    Commodity Sales..............................................   305
    Contractual Services.........................................   204
    Donations and Sales..........................................   210
    Export Credit Guarantees.....................................   205
    Inventory....................................................   208
    Operating Expenses...........................................   203
    Payments.....................................................   230
    TEFAP Donations..............................................   212
Commodity Prices.................................................   289
Common Computing Environment.....................................   301
Conservation Programs............................................   173
Conservation Reserve Enhancement Program.........................   301
    Cover........................................................   186
    Enrollment.................................................278, 284
    Estimates..................................................191, 280
    Practices....................................................   287
    Rental Rates.................................................   283
    Signups and Eligibility Criteria.............................   187
    Technical Assistance.......................................190, 191
Cotton Step 2 Payments...........................................   271
County Offices...................................................   182
    Closures.....................................................   184
    Employees.............................................197, 216, 285
    Workload.....................................................   268
Crop Disaster Payments...........................................   271
Dairy Indemnity Program..........................................   193
Discrimination Lawsuit Settlement.........................138, 139, 162
Emergency and Disaster Assistance:
    Equity in....................................................   143
    Improvements.................................................   136
    Nursery Crops................................................   157
    Specialty Crops.......................................136, 139, 160
Emergency Conservation Program:
    Allocations..................................................   194
    Practices....................................................   197
Emergency Disaster Loans.............................138, 139, 257, 279
Explanatory Notes:
    CCC..........................................................   616
    FSA..........................................................   678
Farm Loans.......................................................   300
    Budget Request.............................................235, 281
    Debt Write-Off...............................................   231
    Delinquencies................................................   243
    Economic Assumptions.........................................   231
    Loans to FSA Employees.......................................   264
    Processing...................................................   235
    Rescheduling.................................................   237
    Socially Disadvantaged Producers.............................   259
Farm Operating Loans...........................................237, 254
Farm Ownership Loans.............................................   255
Farm Storage Facility Loan Program...............................   274
Hazardous Waste Management Program...............................   225
Indian Tribe Land Acquisition Loan Program.......................   264
Livestock Reporting Program......................................   271
Loan Deficiency Payments.........................................   142
Loan Service Fees................................................   185
Object Class 25..................................................   268
Object Class 41..................................................   171
Oilseed Payment Program........................................271, 286
Opening Statement, Under Secretary, FFAS.........................     2
Personnel Systems, Federal vs. Non-Federal.......................   199
Questions Submitted for the Record:
    Chairman Skeen...............................................   162
    Mrs. Emerson.................................................   285
    Mr. Latham...................................................   284
    Mr. Nethercutt...............................................   283
    Ms. Kaptur...................................................   289
Safety Net Proposals.................................151, 274, 281, 288
Salaries and Expenses.....................................168, 224, 269
Space............................................................   180
Staffing:
    County Offices.............................................216, 285
    Employees on Detail..........................................   279
    Farm Loan Program Administration.............................   267
    Levels................................................222, 281, 301
    Reductions...................................................   285
    State Offices................................................   220
State Mediation Grant Program....................................   260
Written Testimony:
    FSA Administrator............................................    36
    Under Secretary..............................................     7

                      Foreign Agricultural Service

Administrative Adjustments.......................................   444
Agricultural Trade Between the U.S. and Taiwan...................   444
Agricultural Trade Offices.......................................   307
Agricultural Trade Agreements....................................   505
Agricultural Trade Offices.......................................   388
Appendix 5--Title II Development Programs in FY 99...............   372
Appendix 4--P.L. 480 Title II Emergency Programs in FY 99........   374
Around the World.................................................   465
Arrearage........................................................   328
Arrearage........................................................   361
Bilateral Agreements.............................................   452
Biographies:
    Mr. Galvin...................................................    87
    Mr. Fritz....................................................    88
Budget:
    Budget Resources.............................................   150
    Need for Additional Resources................................   135
CCC Arrearages as of 1/31/00.....................................   362
CCC Export Credit Guarantee Program..............................   347
China WTO Accession..............................................   442
Claims Paid by CCC Under GSM 102/103 1981-1999...................   364
Cochran Fellowship Program.......................................   391
Cochran-Binational Agricultural Research and Development Fund....   392
Cochran Fellows..................................................   498
Commodities Made Available Under Section 416(b) in 1998-2000.....   461
Countries Graduating from Food Aid Programs......................   441
Countries Included Within Regions--GSM 102/103 and SCGP..........   360
Dairy Export Incentive Program...................................   378
Debts Written Off by CCC.........................................   366
DEIP Awards by Country and Commodity for FY 1999.................   380
Embargoes......................................................138, 139
EEP and DEIP.....................................................   335
Emerging Markets Program.........................................   439
European Union Ban...............................................   442
Executive Summary................................................   384
Explanatory Notes................................................   763
Export Sanctions.................................................   133
Exports of Rough Rice............................................   131
Export Incentive Program.........................................   347
Export Enhancement Program.......................................   329
Export Sanctions on Libya and Iran...............................   447
Exporter Ranking by Awards Under the EEP.........................   331
Exports to the Philipines, Canada and Mexico.....................   446
Extension Type Program...........................................   502
External Transportation..........................................   376
Facility Guarantee Program.......................................   448
Farm Prices......................................................   488
FAS Buyouts......................................................   441
FAS Conferences..................................................   390
FAS Management Retreats..........................................   390
FDM Cooperators and MAP Participants.............................   399
FDM Expense by Cost Category for FY 99...........................   433
FDM Program......................................................   443
Food Aid:
    Increasing Food Aid..........................................   144
    Meeting Increased Food Aid Workload Demand...................   125
Food Security Commodity Reserve..................................   449
Food Security Commodity Reserve..................................   441
Food as a Weapon of Good.........................................   462
Foreign Currency Accounts........................................   449
Foreign Market Development Contribution for FY 99................   432
Foreign Market Development Program...............................   396
Foreign Market Development Contribution for FY 98 and FY 99......   435
Foreign Market Development Cooperator Program (FMD)..............   459
Former Soviet Union..............................................   328
FY 2000 Shows....................................................   385
FY 2001 Shows (Planned)..........................................   386
FY 1999 Shows (Completed)........................................   387
FY 99 P.L. 480 Title 1 Signed Agreements and Financial Terms.....   367
Graph--Prices Received, All Beef Cattle, U.S.....................   495
Graph--Prices Received, Soybeans, U.S............................   490
Graph--Prices Received, Cotton, U.S..............................   492
Graph--Prices Received, Hogs, U.S................................   494
Graph--Prices Received, Milk, U.S................................   493
Graph--Prices Received, Wheat, U.S...............................   491
Graph--Prices Received, Corn, U.S................................   489
H.R. 3140........................................................   134
Imports from Latin America.......................................   447
Inter-Agency Coordination Overseas...............................   126
Internal Transportation..........................................   376
International Cooperation and Development Program................   307
International GMO Concerns.......................................   142
International Trade Show.........................................   310
International Food Shows.........................................   384
Joint Commissions................................................   440
LANDSAT Data.....................................................   388
Language Training................................................   390
MAP Brand Companies, 1999........................................   315
MAP Brand Companies and Food Products 1998.......................   336
Maritime Costs for Food Aid Programs.............................   395
Market Access Program................................307, 311, 312, 497
Market Access Compliance.........................................   446
Mexican Trade....................................................   501
Monetization.....................................................   377
Monetization.....................................................   462
Obtaining Information on U.S. Agricultural Trade.................   141
P.L. 480 Title II................................................   371
P.L. 480 Titles I, II and III....................................   377
P.L. 480 Title I Agreements......................................   366
P.L. 480 Title I Ocean Freight Differential......................   371
P.L. 480 Title I--FY 98 Country Allocations......................   369
P.L. 480 Title I Local Currency..................................   443
Passenger Vehicle................................................   439
Personal Service Contractors.....................................   150
Promotion of Tobacco Products....................................   441
Proposed ATO in Southern Africa..................................   443
Questions Submitted for the Record:
    Ms. Emerson..................................................   458
    Ms. Kaptur...................................................   460
    Mr. Hinchey..................................................   505
    Mr. Skeen....................................................   307
    Mr. Latham...................................................   452
Reimbursements to State Department...............................   439
Representation...................................................   390
Residences Overseas..............................................   445
Resources........................................................   504
Restrictions.....................................................   311
Rice--P.L. 480.................................................451, 459
Rough Rice Food Aid to Jamaica...................................   444
Russian Food Aid.................................................   502
Sale of FAS Property by the Department of State..................   503
Sanctions........................................................   464
School Lunch Program.............................................   377
Scientific Cooperation and Research Program......................   448
Section 416(b) Commodities.......................................   382
Section 416(b)...................................................   458
Section 416(b) and Food for Progress Transportation Costs........   378
Short-term Credit Guarantee Program..............................   449
Statement of the Administrator...................................    57
Summary of FY 99 Export Credit Guarantee Program for GSM-103 as 
  of 9/30/99.....................................................   355
Summary of the Deloitte and Touche Evaluation of MAP.............   326
Summary of FY 99 Supplier Credit Guarantee Program Activity as of 
  9/30/99........................................................   357
Summary of FY 99 Export Credit Guarantee Program for GSM-102 as 
  of 9/30/99.....................................................   348
Supplier Credit Guarantee Program Value of Sales FY 97-00........   309
The Paradox of Poppy.............................................   128
Total Quantity of Commodities Sold to the Former Soviet Union 
  Under GSM......................................................   329
Trade With China.................................................   450
Trade Offices....................................................   496
U.S. Agricultural Products.......................................   310
U.S. Market Share................................................   498
Ukrainian Food Banks.............................................   497
USDA's Role in Foreign Food Policy...............................   460
Use of Monetized Proceeds........................................   127
World Hunger.....................................................   144
WTO Annual Budget................................................

               U.S. Agency for International Development

Assistance in Kosovo.............................................   115
Biography, Hugh Parmer...........................................   124
Farmer to Farmer Program.........................................   526
Feeding Programs in Bosnia.......................................   513
Food Aid:
    Comparison, Foreign and Domestic.............................   514
    Levels.......................................................   533
    Meeting Increased Workload Demands...........................   125
    Monetization...............................................508, 534
    North Korea..................................................   507
    USAID Role...................................................   516
Hurricane Mitch..................................................   114
Inter-agency Coordination Overseas...............................   126
Long Term Commitment.............................................   519
Opening Remarks..................................................   114
Personal Service Contracts.......................................   150
Personnel........................................................   522
Prepared Statement, Hugh Parmer..................................   117
Questions Submitted for the Record:
    Mr. Skeen....................................................   506
    Ms. Kaptur...................................................   516
Title II:
    Claims.......................................................   510
    Funds Used by PVO's..........................................   511
    Need in Africa...............................................   506
    Recoveries...................................................   509
World Hunger.....................................................   144
World Food Programme.............................................   512

                         Risk Management Agency

Biographical Sketch of Kenneth D. Ackerman, Administrator........   113
Congressional Affairs............................................   612
Crop Insurance Program:
    Commercial and Assigned Risk Funds...........................   583
    Crop Participation Rates.....................................   601
    Dairy Options Pilot Program..................................   548
    Group Risk Plan..............................................   550
    Insurance Coverage Offered in Ohio...........................   614
    Insured Crops................................................   596
    Nonstandard Classification System............................   581
    Premium Discounts............................................   608
    Program Delivery.............................................   544
    Program Indicators...........................................   608
    Program Participation......................................541, 607
    Revenue Assurance............................................   579
    Revenue Insurance............................................   613
    Specialty Crop Coverage......................................   613
Data Collection..................................................   611
Explanatory Notes, 2001..........................................   831
Hotline Investigations...........................................   612
Information Technology Costs.....................................   543
Legislation:
    Legislative Proposal.........................................   542
    Legislative Proposal--Livestock Insurance....................   611
    Legislative Proposal--Research and Development...............   610
Marketing Expenditures...........................................   596
Object Class 25 (Contractual Services)...........................   542
Opening Remarks:
    Mr. Skeen....................................................     1
    August Schumacher, Jr., Under Secretary for FFAS.............     2
Power Point Presentations:
    Actuarial Soundness Continues...............................33, 103
    And Still More Choices.......................................   110
    Crop Insurance Reform Priorities............................35, 104
    Crops Insured for the 2000 Crop Year.........................   105
    Farmers Are Offered More Choices Than Ever...................    34
    Growth of Insurance Program 1993 to Present.................106-108
    More Products and Choices....................................   109
    Payments to Farmers Increase................................32, 102
    RMA Resources Drop..........................................31, 101
    Washington Apples............................................   112
    Washington Net Acreage Insured--Apples.......................   111
Questions Submitted for the Record:
    Chairman Skeen...............................................   540
    Ms. Kaptur...................................................   613
Reinsured Companies:
    Crop Insurance Industry Annual Meetings......................   591
    Delivery Expenses............................................   590
    Reinsured Companies..........................................   585
    FCIC/Reinsurance Experience..................................   594
    Payments to Companies vs. Producers..........................   540
    Profits and Losses.........................................540, 581
Risk Management Education........................................   610
RMA/FCIC Financial Condition:
    Administrative and Operating Obligations and Fund Activities.   588
    Total Administrative and Operating Costs.....................   586
    Treasury and Commodity Credit Corporation (CCC) Borrowing....   599
    Unobligated Balance--FCIC Fund...............................   607
Staffing Plans...................................................   540
USDA News Release--``The Clinton Administration's Proposal for 
  Improving the Farm Safety Net''--Improve risk management.......   154
Witnesses........................................................     1
Written Testimony:
    Kenneth D. Ackerman, Administrator of RMA....................    89
    August Schumacher, Jr., Under Secretary for FFAS.............     7

                   Food Safety and Inspection Service

2001 Budget Request..................................860, 888, 894, 923
Advisory and Assistance Services.................................  1009
Amenable Species.................................................  1034
Anti-deficiency Violations.....................................929, 945
Antibiotics......................................................   947
Biography:
    Catherine Woteki.............................................   896
    Caren A. Wilcox..............................................   897
    Margaret O'K. Glavin.........................................   931
Bioterrorism.....................................................   946
BSE Risk Assessment..............................................  1006
Codex Alimentarius.................................891, 969, 1007, 1031
Condemned Products...............................................   976
Coordination of Responses to Outbreaks...........................   867
Country of Origin Labeling....................................940, 1035
Current Inspection Activities....................................   899
Diethylstilbestrol (Des) Chemical Residue.....................962, 1010
Disposition Differences Between Meat and Poultry.................   978
Early Retirement.................................................   978
Egg Products:
    Egg Products Inspection......................................  1037
    Egg Products Inspection and Salmonella Enteritidis...........  1001
    Egg Products Inspection Training.............................  1004
    Egg Safety Action Plan....................................948, 1028
    Shell Egg Surveillance.......................................   955
Electronic Export Certificates...................................  1007
Eligible Exporting Countries.....................................   980
Emergency Transfer Authority.....................................  1027
Explanatory Notes................................................  1039
Exporting Countries Equivalence Determination....................   984
Field Automation and Information Management (FAIM)............976, 1003
Food Emergency Rapid Response and Evaluation Team (FERRET).......  1006
Food Safety:
    Animal Production Food Safety Program........................  1001
    Data on Foodborne Illnesses..................................   934
    Education....................................................   867
    Fight BAC Campaign...........................................   942
    International Food Safety....................................  1024
    Origin of Foodborne Illness..................................  1004
    President's Council on Food Safety...........................   869
    President's Food Safety Initiative....................864, 885, 960
    Research.............................................865, 873, 1020
Foodnet..................................................865, 941, 1026
Forced Molting of Laying Hens....................................   947
Foreign Country Equivalency Determinations...................1006, 1007
FSIS Enforcement Activities....................................943, 991
Grants To States..............................................988, 1004
HACCP:
    Compliance...................................................  1022
    HACCP-Based Inspection Models Project (HIMP).........894, 932, 1030
    Implementation...............................................   858
    Pathogen Reduction...........................................   906
    Plants.......................................................  1002
    Success....................................................873, 901
Import Inspection.................................956, 1003, 1008, 1012
Information Technology...........................................   921
Inspection:
    Activities...................................................   899
    Compliance...................................................   867
    Establishments...............................................   973
    Exemptions...................................................   980
    Product Inspected:
        Amount of Poultry Inspected..............................   993
        Number of Livestock Inspected at Slaughter...............   999
        Poultry Carcasses........................................   994
        Volume and Cost of Meat and Poultry Inspection At 
          Slaughter..............................................   989
International Issues...........................................883, 919
Irradiation......................................................   949
Laboratory Accreditations........................................   978
Legislation......................................................   892
Listeria:
    Outbreaks....................................................   942
    Risk Assessments.............................................  1010
    Testing......................................................   952
Mandatory Recall Authority.......................................   953
Meat and Poultry Hotline.........................................  1001
Microbial Testing................................................  1018
Non-tariff Trade Barriers........................................   954
Object Classification Increase...................................  1009
Opening Remarks..................................................   857
Organic Foods Production Act.....................................   995
Pilot Programs...................................................   970
Public Health....................................................   914
Questions Submitted for the Record:
    Chairman Skeen...............................................   970
    Mr. Kingston.................................................  1033
    Ms. Emerson..................................................  1035
    Ms. Kaptur...................................................  1019
    Mr. Nethercutt...............................................  1034
Refrigeration and Labeling Requirements for Shell Eggs...........  1007
Regulatory Delayering............................................   949
Residue Tests (SOS, STOP, CAST, FAST)............................   985
Research Projects................................................   973
Risk Assessment..................................................   866
Safe Handling by Consumers.......................................  1019
Salmonella:
    Performance Standards........................................   956
    Prevalence.................................................876, 904
    Testing Results..............................................   858
Sanitary and Phytosanitary Cooperative Efforts...................   975
Sentinel Sites...................................................  1002
Single Food Safety Agency................................932, 946, 1025
Staffing:
    Attrition for FSIS Inspectors................................  1009
    Inplant Permanent Full-time Employment.......................   881
    Inspection Staffing.......................................933, 1033
    Inspector Shortages..........................................   951
    Inspector Staffing Levels..................................959, 961
    Inspector Vacancies..........................................   970
    Personnel....................................................  1023
    Transition of the Workforce..................................   912
State Equivalency................................................   975
State Inspection of Meats........................................  1022
Transition to Farm-to-Table Risk-Based Strategy..................   911
Traceback of Imported Product....................................  1003
Veterinarians in U.S. Agricultural Schools.......................  1032
Voluntary Inspection.............................................   987
Witnesses........................................................   857
Written Testimony of Catherine E. Woteki, Ph.D., R.D.............   862
Written Testimony of Margaret O'K. Glavin........................   898

                                
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